Foaming at the Mouth: The Inane Ruling in the Gene Patents Case

There are certain areas of patent law that will immediately cause me to “foam at the mouth.”  One is the doctrine of “inequitable conduct” which has rightly been called a “plague” in patent litigation.  Another is what is “patent-eligible” subject matter under 35 U.S.C. § 101.  For a taste of my “foam” on that subject, see The Bilski Oral Argument Speaks Volume: Start with 35 U.S.C. § 112 where I express my displeasure with the illogical and unworkable “machine or transformation” test currently being reviewed by SCOTUS in Bilski v. Kappos.

A case which has recently drawn my ire is Association for Molecular Pathology v. USPTO which involves various patents obtained by Myriad Genetics (NASDAQ:MYGN) relating the BRCA1 and BRCA2 gene sequences which have been found to be potentially useful in identifying the presence of mutations correlating with a predisposition to breast or ovarian cancer.  The plaintiffs in AMP who want Myriad’s patents invalidated are represented by the ACLU.  The ACLU has put forth (in my opinion) the preposterous and deliberately distorted view that Myriad’s patents cover the BRCA1 and BRCA2 gene themselves.  That is simply not true, as Dale Halling pointed out in his article ACLU Should Be Hit With Rule 11 Sanctions posted on IPWatchdog.  I also agree with Dale (as do others), that the ACLU should be sanctioned under FRCP Rule 11 for this gross and deliberate misrepresentation of what Myriad’s patents cover.

Unfortunately, the ACLU appears to have found an “ally” in Judge Sweet, who is the district court judge handling the AMP case.  In my view, Judge Sweet has either been duped by the ACLU, or is more likely complicit in accepting the ACLU’s warped view of what these patents cover.  That became evident when Judge Sweet denied the motions by Myriad and the USPTO to dismiss this case for lack of subject matter jurisdiction, lack of personal jurisdiction, and failure to state a claim upon which relief can be granted.

In a 152 page opinion (which even includes a lengthy and overdone history on genetics going back to Watson and Crick), Judge Sweet has now added “insult to injury” by declaring all of Myriad’s patents invalid under 35 U.S.C. § 101 as not being patent-eligible subject matter.  At least Judge Sweet had the sense to dismiss ACLU’s even more strained and absurd “constitutional claims” against the USPTO by employing “the constitutional avoidance” doctrine.  Nonetheless, Judge Sweet’s ruling that all of Myriad’s patents are invalid under 35 U.S.C. § 101 is inane (and unsupportable) in the extreme.

[Bio-Pharma]

Why do I say that?  Well, for one, I could be considered more knowledgeable than Judge Sweet on the subject of why purified (or isolated) “products of nature” can be patent-eligible subject matter under 35 U.S.C. § 101, having written on this subject over 30 years ago (just after graduating from law school) when it was a very “hot topic.”  See Guttag, “The Patentability of Microorganisms:  Statutory Subject Matter and Other Living Things,” University of Richmond Law Review, Vol. 13, page 247 (1979).  In other words, I’m very familiar with the SCOTUS (and other court) precedent on the patent-eligibility of “products of nature” cited by Sweet in his opinion (and why this SCOTUS precedent doesn’t support Sweet’s ruling), as well as the CCPA case of In re Bergy which Sweet cites, and more significantly, misrepresents, because the holding in Bergy actually supports the patent-eligibility of Myriad’s BRCA1 and BRCA2 gene sequence technology.  In fact, Judge Sweet would have done himself a favor by reading my article of 30 years past which discusses the holding in Bergy extensively, as well as the CCPA precursor to SCOTUS’ ruling in Diamond v. Chakrabarty (which also, in my opinion, is contrary to Judge Sweet’s position), In re Chakrabarty, instead of opining on an area of patent law he obviously (to me) doesn’t understand.

Judge Sweets ruling that the Myriad’s patents covering the “isolated” (and I do want to emphasize “isolated”) BRCA1 and BRCA2 gene sequences rests primarily on a line of SCOTUS cases often cited (and sometimes even miscited) for the proposition that “products of nature” are patent-ineligible:  the 1874 case of American Wood-Paper Co. v. Fibre Disintegrating Co.; the 1931 case of American Fruit Growers, Inc. v. Brodgex Co.; the 1928 case of General Electric Co. v. De Forest Radio Co.; and the 1948 case of Funk Bros. Seed Co. v. Kalo Innoculant Co. The very age of these cases is troubling for determining the patent-eligibility of Myriad’s BRCA1 and BRCA2 gene sequence technology which occurred long afterward.  Even more troubling is that all of these cases are discussed in my article, and Judge Sweets take on what these cases mean doesn’t convey the whole picture.

First, Judge Sweet’s opinion suggests that these cases have consistently applied the “products of nature” doctrine in determining whether subject matter patent-ineligible.  But as my article points out, that is far from the truth:  “A major difficulty for the courts has not been in stating the [“product of nature”] doctrine, but rather in determining whether there is such a doctrine and how to apply it.”  In this regard, I contrasted the General Electric case (where SCOTUS held a patent on substantially pure tungsten to be invalid for covering a “product of nature”) with Judge Learned Hand’s opinion in the 1912 case of Parke-Davis & Co. v. H.K. Wolford Co. (which upheld the patent on adrenalin extracted from glands of animals and which essentially deemed the “product of nature” doctrine irrelevant to patent-eligibility).  In fact, Judge Sweet’s dismissal of Judge Hand’s ruling in Parke-Davis as being based strictly on “novelty grounds” is astonishing given that Myriad’s “isolated” BRCA1 and BRCA2 gene sequences are also “novel” as they don’t exist in nature.  That Judge Sweet’s suggests that Parke-Davis is “contradicted by subsequent case law” (i.e., Bergy and the 2009 Federal Circuit case of Prometheus Labs. V. Mayo Collaborative Services) also doesn’t “hold soap” in my view.

Second, several of these SCOTUS cases don’t rest primarily on “products of nature” being patent-ineligible.  For example, in the American Wood-Paper case, SCOTUS ruled a patent covering a purer form of cellulose pulp suitable for manufacturing paper invalid in view of cellulose pulp suitable for manufacturing paper already being in existence (i.e., was an attempt to patent an “old compound” and thus not novel).  The holding in Funk Bros. Seed Co. is more properly viewed as an attempt to patent a mixture of non-inhibiting strains of bacteria which was deemed to be unpatentable as being obvious (i.e., under 35 U.S.C. § 103), which Judge Sweet also incorrectly suggests as being based strictly on “patent-eligibility” grounds.

Third, it is questionable whether the “product of nature” cases such as American Fruit Growers are still good law, especially in view of SCOTUS’s ruling in Diamond v. Chakrabarty.  In American Fruit Growers, SCOTUS ruled that fruit impregnated with borax was not a “manufacture.”  As my article pointed out, that ruling appears to be bizarre based even on the definition of “manufacture” used in American Fruit Growers.  In fact, later cases (including Diamond v. Chakrabarty) have cast the decision in American Fruit Growers (rightly so in my opinion) into oblivion.  Accordingly, Judge Sweet’s statement that the “clear line of [SCOTUS] precedent and accompanying lower court authorities, stretching from American Wood-Paper through to [Chakrabarty v. Diamond], establishes that purification of a product of nature, without more, cannot transform it into patentable subject matter” simply won’t stand up under critical scrutiny.

What is most alarming about Judge Sweet’s opinion is his characterization (or more appropriately mischaracterization) of the CCPA’s Bergy case.  Judge Sweet makes numerous quotes from Judge Rich’s opinion in Bergy on how 35 U.S.C. § 101 should be interpreted.  But what Judge Sweet neglects to point out is that Judge Rich ruled in Bergy that a biologically pure culture was deemed to be patent-eligible under 35 U.S.C. § 101.  Why did Judge Sweet neglect to point out this highly relevant fact?  Instead, if the holding in Bergy is considered in appropriate context, it supports Myriad’s “isolated” BRCA1 and BRCA2 gene sequences as being at least patent-eligible under 35 U.S.C. § 101 because they don’t exist in nature and cannot exist without significant human intervention.

What takes Judge Sweet’s opinion from the sublime to the surreal is his ill-advised reliance upon the “machine or transformation” test from Bilski to invalidate Myriad’s method claims using this BRCA1 and BRCA2 gene sequence technology.  In fact, Judge Sweet’s reasoning for distinguishing the Prometheus case makes even more glaring the problems in trying to apply the “machine or transformation” test from Bilski to medical diagnostic technologies such as those encompassed by Myriad’s method claims.  See CAFC: Method for Calibrating Drug Dosage Is Transformative where I point out how “Judge Lourie’s opinion in Prometheus is clear evidence of how tortuous it is to apply the Bilski machine or transformation’ test objectively to drug dosage calibration methods like those in Prometheus.”  That Judge Sweet would even rely so heavily on the Bilski test which is likely to be overturned by SCOTUS (and replaced with who knows what “test”) to invalidate Myriad’s method claims doesn’t seem very wise (or prudent) to me.

In the end, it is my considered opinion that Judge Sweet knew the result he wanted to reach (i.e., invalidate Myriad’s patents), and simply cobbled together a justification for it.  (Treating the claims in Myriad’s patents are a “lawyer’s trick” also doesn’t suggest impartiality.)  If nothing else, there is enough of a dispute about the essential facts needed to reach Judge Sweet’s conclusion to deny the plaintiff’s motion for summary judgment of invalidity based on 35 U.S.C. § 101.  That Judge Sweet needed to spend 152 pages trying to justify his grant of plaintiff’s motion for summary judgment speaks volumes about why this grant was inappropriate.

But then, that’s my opinion.  Even so, I do hope the Federal Circuit thoroughly trounces Judge Sweet’s opinion.  It’s “bad law” based on “badly distorted facts,” as my article of 30 years past shows.  Just the holdings in Bergy and Diamond v. Chakrabarty alone should be enough to overturn this misguided ruling in AMP.

*© 2010 Eric W. Guttag