Yesterday the United States Supreme Court heard oral arguments in Association for Molecular Pathology v. Myriad Genetics, Inc. While the Association for Molecular Pathology (AMP) is the named party in the case, it is really a case brought and forwarded by the American Civil Liberties Union (ACLU).
Myriad Genetics is the patent holder on various innovations relating to isolated DNA comprising an altered BRCA1 DNA and various methods of screening for cancer built upon various observations of the altered BRCA1 DNA. Essentially, AMP and the ACLU, along with researchers, competitors of Myriad Genetics and consumers filed a lawsuit challenging the constitutionality of a number of gene patents owned by Myriad and argued that gene patents should not be granted because patenting a gene is the same as patenting something that exists in nature.
This argument succeeded at the district court, but has twice failed at the Federal Circuit. The Federal Circuit initially reversed the district court, but appeal was made to the Supreme Court by AMP/ACLU. See As Predicted, Federal Circuit Rules Isolated DNA Patentable. In the meantime the Supreme Court issued a decision in Mayo v. Prometheus and remanded this case to the Federal Circuit for further consideration in light of the Court’s decision in Mayo v. Prometheus. The Federal Circuit again sided with Myriad Genetics. See AMP v. USPTO Remand Déjà Vu. Appeal was taken to the Supreme Court, which accepted certiorari. See Supreme Court Grants Cert in Amp v. Myriad. The only issue accepted by the Supreme Court was the broadest issue: are human genes patent eligible?
I have reviewed the transcript of the oral argument and I almost don’t know where to start. Despite accepting the largest question possible about the patentability of all human genes of any kind, shape or form, the Supreme Court seemed to want to focus on the claims. They also seemed in complete unanimity with respect to whether cDNA should be patent eligible. Myriad, the Solicitor General and all of the Justices that spoke seemed to be leaning toward finding that at least cDNA is patent eligible. But will that translate into a pro-patent ruling? That seems far less clear, although if cDNA is patent eligible I don’t know how the Myriad claims could be lost. That, of course supposes the Supreme Court understands patent law and the science involved.
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Ultimately, the United States did not take a position on whether the claims at issue in the dispute between AMP and Myriad are patentable, despite being pushed to do so by Justice Sotomayor. General Verrilli explained: “I am going to invoke my privilege as an amicus in this situation. I think that’s a fight between the parties.” Nevertheless, the U.S. did take the position that cDNA is patent eligible, with Verrilli saying: “We’re just saying as a conceptual matter that we think cDNA is a creation of the lab, it’s an artificial creation; it’s as a general matter patent eligible.”
Indeed, it seemed the Justices were inclined to agree that cDNA is patent eligible. At one point during Mr. Castanias’ argument, while explaining the Myriad invention to Chief Justice Roberts and why it was not a trivial snipping of DNA segments, this exchange ensued:
CASTANIAS: … Myriad inventors first created the cDNA, which we agree at least on that score with the Solicitor General, is indeed eligible for patenting. But then — and by the way, that cDNA was created from hundreds of different patient samples to create what was called a consensus sequence.
CHIEF JUSTICE ROBERTS: Okay. You’ve got the cDNA.
If cDNA is patent eligible subject matter, as it seems likely based on the tone of the oral argument, that should be very good news for Myriad. As Justice Breyer recognized during questioning of Mr. Hansen (representing AMP), the Myriad claim says they want “the isolated DNA of claim 1 wherein said DNA has the nucleotide sequence set forth in SEQ ID No. 1.” If you look at SEQ ID No. 1 clearly states that the molecule type is cDNA, thus cDNA seems to be a part of the claim, not to mention that the cDNA used by Myriad was a consensus sequence made from hundreds of different patients. Thus, if cDNA is patent eligible then the Supreme Court must find that at least some genes are patent eligible and must also find the Myriad claims patent eligible.
Whether the Supreme Court Justices really captured that nuance remains in doubt. It seemed at times that Justices Sotomayor and Kagan were openly arguing the AMP/ACLU case. Sadly, at times it was apparent that the Supreme Court doesn’t understand even the most basic and fundamental patent law concepts.
I spoke at a conference on patent eligibility last Friday at American University Washington College of Law. As a part of the discussion I stated what so many in the industry say in private conversations and believe. The Supreme Court is in over their head on patent cases and should leave well enough alone. The fact that the Supreme Court didn’t understand patents was the very purpose of forming the Federal Circuit in the early 1980s. Congress wanted to take patent cases away, but it was politically infeasible to strip the Supreme Court of jurisdiction, although Constitutionally possible. So a specialized Court of Appeals was created — The United States Court of Appeals for the Federal Circuit. For years thereafter the Supreme Court when they would take a case showed deference to the Federal Circuit, identifying it as a specialty, expert court. But that has changed and the Supreme Court largely ignores the Federal Circuit. More difficult to accept is the reality that they simply don’t understand patent law but make decisions that impact the national technology and innovation economy. It is hard to blame them for not knowing patent law since they only see several cases a year, but it is their own fault that they dip their toe into these difficult legal and scientific waters wholly unprepared, yet they do real mischief.
Of course, it is difficult to read the Supreme Court tea leaves, and any judge can and will ask questions for a variety of reasons, but still some of the exchanges have to make you wonder whether the Supreme Court is up to the challenge of handling an issue as scientifically complex and in an area of law that is layered with nuances. It really seems that they struggle with the basics in a way you might expect a second year law student to struggle. Take for example this exchange between Justices Kennedy and Sotomayor with Mr. Hansen. It is clear that they don’t understand that a patent is not either wholly valid or wholly invalid, but the validity inquiry must go claim by claim. It is black letter patent law that some claims can be valid within a patent while others are declared invalid. That such a basic concept wasted any oral argument time is embarrassing. The exchange went as follows:
JUSTICE KENNEDY: Under our — our law, is a patent ever divisible so that if it’s valid in part but invalid in another part, it can still stand as to the part?
HANSEN: No, it is not permissible under patent law to do essentially a narrowing — narrowing construction of the — of the claim.
JUSTICE KENNEDY: But if you haven’t challenged this, then — then where are we with respect to tagging? I don’t quite understand. Because the — the entire patent which includes tagging would fail under your argument.
HANSEN: Oh, I’m sorry, no. I misunderstood. The claims that we are challenging do not — are not limited to tagging, are not limited to use as probes. There are other claims that we are not challenging that are limited to probes. Those would remain, but the — but the claims that we’re challenging would in fact be struck down, because they’re not so limited. In fact —
JUSTICE SOTOMAYOR: Then — then explain when you said you can’t narrow. You said earlier you can’t narrow.
HANSEN: Yes. If a claim reaches something that is both impermissible and permissible, it — the claim is invalid, period.
JUSTICE SOTOMAYOR: All right, that individual claim is invalid.
HANSEN: That individual claim.
JUSTICE SOTOMAYOR: But the patent with respect to claims that are not invalid would still stand.
HANSEN: That is correct, Your Honor.
Later Justice Kagan didn’t seem to appreciate that there is a utility requirement for all inventions to be patented. When Mr. Castanias was answering a hypothetical about isolated chromosomes he explained that the first isolated chromosomes could be patent eligible under Section 101 if they a use; a new utility. This provoked Justice Kagan to say she believed use patents are different and instead wanted to focus on isolated chromosomes, not a patent for the use of isolated chromosomes, apparently completely oblivious to the utility requirement that is a fundamental, threshold inquiry in every patent application. The exchange went as follows:
JUSTICE KAGAN: … Do you think that the first person who isolated chromosomes could have gotten a patent on that?
CASTANIAS: I think in theory that is possible, but I should say this: Because this case is about Section 101, I’m trying — I’m answering your question as though it’s about 101, patent eligibility.
JUSTICE KAGAN: Yes.
CASTANIAS: Would it be obvious, would it be novel? I’m not sure. Those are different — those are different analytical structures.
JUSTICE KAGAN: Right.
CASTANIAS: But would it — and I think really, the — the statute does the work here. It is a new and useful composition of matter —
JUSTICE KAGAN: But the first —
CASTANIAS: — if it had use. If it had a new utility, then yes.
JUSTICE KAGAN: I’m sorry, because — because — because, like Justice Breyer, I consider uses — patents on uses in a different category. So I’m just asking, could you patent the isolated chromosome?
CASTANIAS: Again, I — I perhaps am not making myself as clear as I should. In Section 101, a patent claim must be shown to be useful; and that — that is a utility that it has to be shown —
Additionally, at times the questions from the Supreme Court seemed nearly incoherent. Perhaps most offending was Justice Breyer. After incorrectly saying that the Supreme Court does not follow the “anything made by man under the sun” legislative history of the 1952 Patent Act, he says something nearly incomprehensible. This is not the only place in the transcript where this occurs, but this is illustrative.
JUSTICE BREYER: Ah. Then — then watch what you’re doing. That’s very, very interesting, because, really, we are reducing, then, 101 to anything under the sun, and — and that, it seems to me, we’ve rejected more often than we’ve followed it.
And particularly with a thing found in nature doctrine, because, of course, it doesn’t just — human kidneys and so forth. Everything is inside something else. Plants, rocks, whatever you want. And so everything will involve your vast taking something out of some other thing where it is, if only the environment. And it’s at that point that I look for some other test than just that it was found within some other thing.
I don’t know how you can respond to some of this.
Then, as Mr. Castanias is wrapping up his argument on what seemed to be a high note, Chief Justice Roberts asks a question that clearly befuddles him. You can almost know what Castanias is thinking. As I read what the Chief Justice says I started shaking my head and saying to myself: “he just doesn’t get it, and he hasn’t been following along with respect to any of the science.”
CASTANIAS: There is no risk of a natural law or a physical phenomenon like energy or electricity, neither of which falls within the statutory categories. There is no risk of anything being preempted other than what the claims properly claim, which are human-made inventions of isolated molecules… It’s important to note that molecules have been patented for a very long time. That’s what drugs are. And drugs are often made by taking one molecule and another molecule, both of which are known, reacting them in a test tube, which is a very common thing, reactions have been around 100 years just like snipping has been, but they make something new and useful and life saving from that.
CHIEF JUSTICE ROBERTS: Well, I don’t understand how this is at all like that, because there you’re obviously claiming things and getting something new. Here you’re just snipping, and you don’t have anything new, you have something that is a part of something that has existed previous to your intervention.
CASTANIAS: Well, again, Mr. Chief Justice, I — I — the discussion we had earlier, the — in — in fact, the sequence that’s claimed in Claim 1 of the ‘282 patent was not created by snipping… Only once it was created can a scientist ever know how and where to make the decision to snip.
You can almost sense the palpable frustration of Castanias. What part of my earlier answers about the consensus segments and the fact that the claims contain reference to cDNA is confusing to you Mr. Chief Justice? Were you not following any of the discussion we had earlier? Obviously, that couldn’t be said, but it is exactly what one would have been said to a subordinate. Chief Justice Roberts simply wasn’t understanding the science and is content to pretend that the creation of the molecule is akin to cutting paper with a pair of scissors.
At least the Supreme Court identified the fact that there is not universal agreement within the Executive Branch on the position of the Solicitor General. Notably, the USPTO disagrees and did not sign onto the brief. Justice Alito brings that to bear with the following exchange:
JUSTICE ALITO: Well, the issue here is a very difficult one. It’s one on which the Government has changed its position; isn’t that correct?
GENERAL VERRILLI: Yes, Your Honor.
JUSTICE ALITO: It seems that there is disagreement within the Executive Branch about it. This case has been structured in an effort to get us to decide this on the broadest possible ground, that there’s no argument, that it’s just about 101, it’s not about any other provision of the Patent Act.
Why — why should we — why should we do that? We have claims that if patent eligibility is denied here it will prevent investments that are necessary for the development of new drugs or it will lead those who develop the new drugs, new diagnostic techniques, to keep those secret, not disclose them to the public. Why — why should we jump in and — and decide the broadest possible question?
Substantively, the biggest issue facing Myriad is the erroneous belief that the Myriad inventors did nothing other then take out a pair of scissors. In addressing a question from Justice Sotomayor very early in his argument, Castanias took issue with the representation that the Myriad inventors really did nothing. He said:
I guess I’ll take issue with the notion that there is nothing additive here. What Myriad inventors created in this circumstance was a new molecule that had never before been known to the world. Now remember, genes are themselves human constructs. And this points up some of the serious analytical problems with the Product of Nature Doctrine as the line-drawing exercise that you’ve asked General Verrilli and Mr. Hansen to engage in has illustrated.”
Justice Sotomayor continued to pepper Castanias, bogging him down with extraordinarily simplistic hypotheticals that seemed particularly unenlightening relating to baking cookies. Castanias, a bit exasperated, stated: “that’s the problem with using the really simplistic analogies, with all due respect, Your Honor…”
To the rescue came Justice Alito, to bring the matter back to something relevant. When Justice Sotomayor side-tracked Castanias he was about to explain why the chemical composition of isolated DNA is different than naturally occurring DNA, which is at the very crux of the matter before the Court, unlike the mind-numbing hypothetical relating to cookies. Frankly it almost seemed as if Justice Sotomayor was trying to run out the clock and prevent Castanias from getting to the critical points of his argument. In any event, this is the exchange between Justice Alito and Castanias, which is immediately followed by a follow-up from Justice Scalia.
JUSTICE ALITO: Why is the chemical composition in the isolated DNA different? You were about to explain that.
CASTANIAS: Yes, thank you, Justice Alito. It — it’s got 5,914 nucleotides. The genome itself has over 3 billion. It’s arranged in the way set forth — as set forth in the SEQ IDs number 1 and 2. Number 2 is the so-called genomic DNA, SEQ ID number 1 is the, as Justice Breyer understood, the cDNA molecule.
When you look at those particular sequences, there was invention in the decision of where to begin the gene and where to end the gene. That was not given by nature. In fact —
JUSTICE SCALIA: Well, well, well, well, this is something I was going to ask you. I — I assume that it’s true that — that those abridged genes, whatever you want to call them, do exist in the body. That they do exist. You — you haven’t created a type of gene that does — does not exist in the body naturally.
CASTANIAS: But we’ve — I’ll — I’ll use my own simplistic analogy which we offered in our brief and which we offered to the lower court. A baseball bat doesn’t exist until it’s isolated from a tree. But that’s still the product of human invention to decide where to begin the bat and where to end the bat.
Later, in an exchange with Justice Kagan, who was questioning whether an uprooted tree from the Amazon could be patented because it was now isolated, the following exchange occurred.
JUSTICE KAGAN: I don’t know what manipulation means. I mean, you have to take the plant and uproot it, all right?
JUSTICE KAGAN: And carry it away and isolate it. Can you now patent the thing itself? You’ve now taken it out of the Amazon forest. Can you now patent it?
CASTANIAS: Well, what I — what I haven’t done is isolated a new thing. All I have done is isolate the plant from the forest. And that’s the distinction I think I’m trying to get across to the Court…
JUSTICE KAGAN: Well, the plant in the forest can’t be used for any purpose either. It only has a use when it’s taken out — you know, when it’s uprooted and taken out of the forest. But it’s still the same thing. And I guess what you haven’t gotten me to understand is how this is different than that. It’s still the same thing, but now that you’ve isolated it, it in fact has lots of great uses.
CASTANIAS: Well, I think there are two ways — two ways to look at that.
First of all, if you want to look at it from the — the perspective of the so-called product of nature doctrine, which I think has some very dangerous consequences if it’s not cabined and understood correctly — but if you look at it strictly from a product of nature doctrine, you could say, well, that’s the same plant and it says in the 1930 legislative history of the Plant Patent Act that plants that are unmanipulated by the hand of man are not eligible for patents, and that’s fine, in terms of their breeding and genetics and that sort of thing.
But the product of nature doctrine is troublesome for this reason… Modern medicine, particularly the area of personalized medicine, is trying to get to a point where what we are administering to individual patients is giving them the opportunity to mimic the actions of the body. And — so actually, the goal of medicine is to get closer to nature, rather than farther away. And anything that takes the product of nature doctrine beyond the simple truism that the product of nature is something that is not human invention, then that’s very dangerous, not just for our case —
Later, Justice Kennedy came back to a point he first raised with Mr. Hansen about what harm might befall the industry if the Court were to either adopt the view of the Solicitor General or rule genes unpatentable altogether. Earlier Justice Kennedy expressed resistance to the argument that sufficient incentive exists for scientist to invent in this space despite patents. While that is ridiculous when you realize that Myriad invested more than $1 billion into this technology, Hansen argued that recognition and possible Nobel Prize winnings was enough of an incentive. Kennedy stated: “the taxpayers will do it, don’t worry, is I think an insufficient answer.” He subsequently said: “I just don’t think we can decide the case on the ground, oh, don’t worry about investment, it’ll come.”
This is significant because it was Justice Kennedy who wrote the Supreme Court’s decision in Bilski and in that decision he was concerned about harming the industry, even recognizing in his opinion that the parade of horribles that could befall many diverse industries with a bad ruling was heard loud and clear by the Court. Thus, Castanias’ back-peddling and soft-selling the critical question about innovation and research was puzzling. This should have been a softball sitting on a tee with Castanias swinging a bat large enough for Paul Bunyan! The exchange went as follows:
JUSTICE KENNEDY: Let me ask you this… if we were to accept the Government’s position that the DNA is not patentable but the cDNA is, would that give the industry sufficient protection for innovation and research? And if not, why not?
CASTANIAS: The — the problem of making that decision now is that so much has happened since these gene patents issued and since the utility guidelines. I can’t tell you for a certainty whether it will hurt the industry as a general matter to not have isolated gene but only have cDNA patents…
And that brings me back to the utility guidelines. This line was drawn. It was drawn by an expert agency that sits at the intersection of law and science, and it has said, without any apparent — other than the declarations and amicus briefs that have been put into this case — without any apparent effect on the explosion in biotechnology and the successful, economically successful, technologically successful, and life-saving industry that is at the heart of these inventions.
That has not — those — that parade of horribles has not happened. And you don’t have to hypothesize at this point because you’ve got all of these years of experience between the time these patents issued and the time that this — this challenge belatedly came along.
We can’t tell whether it will hurt the industry? What about the hundreds and thousands of Biotechnology start-ups that rely on investor capital in order to spend those 8, 10, 12 years working before they have any chance of profitability? How many will see investment without priority rights in the form of patents to protect the fruits of their research and development?
Castanias’ point about the patenting of genes showing no rationale evidence of harming research and development was a good one, but he buried it and walked in backwards. He did repeatedly make the point that tens of thousands of these patents have issued over the past 30+ years and the USPTO 12 years ago set forth the examination guidelines for these types of inventions after consulting with both industry and skeptics. This was a good point. It would have been a better point to tie the two together and point out that where the Government and the challenger to the patents wants to upset the longstanding, reasonable expectations of rights in a property regime they should bear a very heavy burden. Further, if they are claiming harm to research and innovation they should face a similarly heavy burden to prove that. Given the enormous and growing success of the U.S. biotechnology sector reality simply betrays the argument against patenting genes.
What will the Supreme Court do? I have no clue. I suspect cDNA will be patent eligible, so the Supreme Court will say that at least some human genes are patent eligible. I suspect they will not finally decide the case, will remand to the Federal Circuit and the Federal Circuit will find the Myriad claims patent eligible. We will then likely be back to the Supreme Court for another round.
Of course, given the apparent unfamiliarity with even basic patent law principles and failure to comprehend the science and willingness to take evidence on the science never before entered into the district court record but filed in amicus briefs, who knows what they will do?