On Friday, October 29, 2010, practically on the eve of a national election that will in all certainty be an enormous rebuke of the Obama Administration and the Democrats’ agenda in general, the Department of Justice filed an amicus brief at the United States Court of Appeals for the Federal Circuit that would destroy the U.S. biotechnology sector. In an astonishing and irresponsible policy shift that directly contradicts the long-standing policy of the United States federal government and a variety of agencies, the Department of Justice is promoting the dialing back of what is considered patentable subject matter and is urging the Federal Circuit to rule that “isolated but otherwise unaltered genomic DNA is not patent-eligible subject matter under 35 U.S.C. § 101.”
Mr. President, with all due respect, the anti-business policies of your Administration are not only preventing a recovery, but they are costing Americans jobs. Uncertainty is what is causing between $1 trillion to $3 trillion to be sitting on the sidelines doing nothing to facilitate a recovery. Businesses are afraid of what their taxes will be, of the cost of health care, whether there will be some kind of cap and trade regulation through the Environmental Protection Agency and whether there will be slow-down or double-dip recession. The economy wants to charge forward, but that won’t happen until businesses and individuals feel the future offers some sense of stability.
The fear of the unknown is causing a crippling paralysis, and now your Department of Justice is trying to persuade the Federal Circuit to follow its recommendation, which will cost tens of thousands of jobs and hundreds of billions of dollars of corporate value to be erased. Pensions invested in the stock market will be destroyed and a double dip recession will be virtually assured. This is irresponsible and has to be demoralizing to the United States Patent and Trademark Office and other agencies throughout the federal government that have disagreed with this interpretation under BOTH Republican and Democratic Administrations.
In commenting on the troubling decision of the Obama Administration to throw the biotechnology industry under the bus, the Biotechnology Industry Organization (BIO) explained in its press release:
Unfortunately, the Department of Justice’s brief — to the extent it fails to fully support the patentability of such DNA-based inventions — is inconsistent with the position that agencies of the U.S. government, through both Democratic and Republican Administrations, have taken domestically and internationally for more than two decades. If adopted, the Department of Justice’s position would undermine U.S. global leadership and investment in the life sciences, harm U.S. economic growth and competitiveness at home and abroad, and be counterproductive to the Administration’s own initiatives to fight cancer, develop renewable sources of energy, and clean the environment by reducing dependence on fossil fuels such as petroleum.
So the Department of Justice is potentially going to cripple an entire industry, cause the valuation of some companies to asymptotically approach zero, make it more difficult to fight diseases such as cancer and act as a road block to exciting research into alternative fuels. The DOJ position also throws the Patent Office under the bus, as well as NIH and other agencies. Talk about one hand not knowing what the other hand is doing! It is as if there is no one actually in charge, or at the very least there are no controls in place to ensure that agencies within the federal government are pointed in the same direction and aiming to achieve the same goals. Its seems as if the Department of Justice is effectively working against the Department of Commerce, the Department of Health and Human Services and the Department of Energy. Amazing!
In terms of substance, if you actually read the Department of Justice amicus brief it will become clear they know very little about patent law, innovation or the importance of a stable set of laws in general. The DOJ position can best be summarized by the following, taken from its amicus brief:
Methods of identifying, isolating, and using such DNA molecules may be patented, as may any new and useful alteration of those molecules through human intervention. Genomic DNA itself, however, is a product of nature that is ineligible for patent protection, whether or not claimed in “isolated” form.
We acknowledge that this conclusion is contrary to the longstanding practice of the Patent and Trademark Office, as well as the practice of the National Institutes of Health and other government agencies that have in the past sought and obtained patents for isolated genomic DNA. The district court’s judgment in this case, however, prompted the United States to reevaluate the relationship between such patents and the settled principle under Supreme Court precedent that the patent laws do not extend to products of nature. For the reasons below, the United States has concluded that isolated but otherwise unaltered genomic DNA is not patent-eligible subject matter under 35 U.S.C. § 101.
First, let’s clear up one thing right out of the box. Not only is this position urged by the Department of Justice in direct contradiction to the policies of the Department of Commerce (by and through the United States Patent and Trademark Office), but it would also be in direct contradiction to the well settled law of the United States Supreme Court. So the DOJ can talk about their position being “reevaluated” in light of Supreme Court precedent, but that is utterly false and horribly misleading.
In Diamond v. Chakrabarty the United States Supreme Court explained:
The Committee Reports accompanying the 1952 Act inform us that Congress intended statutory subject matter to “include anything under the sun that is made by man.”
The Supreme Court went on to explain:
[Chakrabarty’s] claim is not to a hitherto unknown natural phenomenon, but to a nonnaturally occurring manufacture or composition of matter – a product of human ingenuity having a distinctive name, character and use. The point is underscored dramatically by comparison of the invention here with that in Funk. There, the patentee had discovered that there existed in nature certain species of root-nodule bacteria which did not exert a mutually inhibitive effect on each other. He used that discovery to produce a mixed culture capable of inoculating the seeds of leguminous plants. Concluding that the patentee had discovered “only some of the handiwork of nature,” the Court ruled the product nonpatentable… Here, by contrast, the patentee has produced a new bacterium with markedly different characteristics from any found in nature and one having the potential for significant utility. His discovery is not nature’s handiwork, but his own; accordingly it is patentable subject matter under 101.
Thus, the well established law announced by the Supreme Court clearly and unambiguously states that when there is human intervention to bring about a useful innovation that is different from what naturally occurs, there is patentable subject matter. And that is exactly what we have in the case of isolated genes because despite what the DOJ says, it is a scientific fact that an isolated gene does not occur naturally in nature. It needs to be extracted.
Unfortunately, the lunacy of the Department of Justice position does not stop with re-writing patent laws and infusing tremendous uncertainty to a question as fundamental as patentable subject matter. The DOJ brief actually says: “the isolated DNA segment itself remains, in structure and function, what it was in the human body.” This logical construct is actually rather brilliant because it allows the DOJ to skirt the real issue and ignore the direct and controlling Supreme Court precedent. Notice that the DOJ wants to really say that the isolated DNA segment is the same as what is in the human body, but that is not what they are saying. In order to attempt to make a statement that is not scientifically incorrect they merely say that the structure and function of the isolated DNA is the same as that segment within the human body that is not isolated.
Of course, the great minds at the Department of Justice have no support and provide no citation for the conclusion that the structure and function of isolated DNA that has been extracted is the same as un-isolated DNA still within the human body. (see page 21 of their brief). This creative, but tortured, logical construct completely and totally ignores the fact that in no human body does extracted and isolated segments of DNA exist. You see, this innovation is patentable precisely because the extracted and isolated segment does not exist in the human body.
To support its logically tortured and misleading view that isolated DNA should not be patentable subject matter, the DOJ makes the follow analogy to coal:
Many natural products — coal beneath the earth, cotton fibers mixed with cotton seeds, the stigmas of the saffron flower — must be physically separated, i.e., “isolated,” from their natural environments before becoming useful to mankind, but few would doubt that coal, cotton, and saffron are products of nature and not patent-eligible.
The trouble with this analogy is that coal actually does exist in isolated forms in nature. Coal could be extracted from the ground in isolated form, so the isolation of coal from the ground in a form that requires physical separation does not mean that the isolated form of coal is patentable, although certainly the process for isolating coal, if new and nonobvious, would be patentable.
In nature there is no such thing as an isolated segment of DNA. The segment of DNA is inextricably intertwined with the rest of the DNA, and only though human intervention is the segment of DNA capable of being extracted, thereby resulting in something that affirmatively does not exist in nature; namely an isolated segment of DNA. Thus, pursuant to the controlling precedent in Diamond v. Chakrabarty, isolated segments of DNA are patentable. So while the Department of Justice is undoubtedly proud of themselves for the aforementioned coal analogy, comparing something that exists in nature to something that does not exist in nature shows either a complete failure to understand the fundamental issues or a level of deception in order to achieve an agenda driven goal that is unbecoming of the Department of Justice.
The vast majority of the cases relied upon by the Department of Justice are from the 1920s and the 1930s, except for those that are from the 1880s and a concurring opinion here and there. So the DOJ is acknowledging that they are promoting a view that would require the overturning of well settled law and a return to our un-enlightened view of patentability prior to World War II, a time when genetic innovations like the ones being made today could never have been imagined.
The same liberals responsible for this anti-patent position are also so quick to chide Supreme Court Justice Antonin Scalia for his rather radical desire to interpret the United States Constitution as if we are living in 1790. I have to agree with the chiding of Justice Scalia on this point. I think we need to understand the principles and what the Framers of the Constitution were attempting to accomplish and why, but pretending that it is 1790 and there are no planes, trains and automobiles is silly. Scalia was the only Justice who didn’t sign on to an opinion or dissent in Bilski v. Kappos that acknowledged that at least some software is patentable subject matter. Nevertheless, excuse me for noticing the hypocrisy here. If it is fair game to chide Justice Scalia for how he views the Constitution it is appropriate to point out that those same people want patent laws for the 21st century that harken back to the 19th century and early 20th century? This is ridiculous!