IP Law Bulletin

In an August 6, 2012 order, Judge Webber of the Eastern District of Missouri confirmed the jury verdict, including the reasonable royalty damage award of $1 billion in Monsanto Co. v. E.I. DuPont de Nemours & Co., Civil Action No. 09-CV-686 (E.D. Missouri August 6, 2012) (Webber, D.J.). The award is the fourth largest jury award in a patent trial in U.S. history, and is especially surprising given that DuPont’s accused product had never been made available to the public.

While some biotechnology patent owners breathed a short sigh of relief on August 16, 2012, as the US Court of Appeals for the Federal Circuit issued the highly anticipated decision Association for Molecular Pathology v. Myriad Genetics, finding that DNA sequences are indeed eligible for patent protection, not all biotech innovators will be happy with the Myriad decision since certain diagnostic method claims were again struck down as ineligible for patent protection. The Federal Circuit’s application of the Mayo case to Myriad’s claims on diagnostic methods provides little guidance on how to draft such diagnostic claims to secure allowance and survive future patentability challenges. While it is clear that the claims must recite something "transformative," what constitutes a transformation in a diagnostic method remains to be elucidated. The final word on this subject may need to come from the Supreme Court.

On August 14, 2012, the U.S. Patent and Trademark Office (USPTO) published its final rules for implementing the Inventor’s Oath or Declaration provisions of the America Invents Act (AIA). The final rules take effect on September 16, 2012, with respect to any application filed on or after this date, regardless of any claim for priority. The final rules provide a great deal of detailed explanation and include the new text of the relevant C.F.R. sections, but below is a brief summary of significant changes implemented by the final rules.

As diagnostics, end-user sophistication, and mobile and web-based technologies grow, so does the likelihood that potential infringement is carried out across multiple users or entities, i.e., divided infringement. Divided infringement scenarios exist where a single entity does not perform every element of a claim, but rather different entities perform the different steps of a claim. This divided infringement scenario occurs frequently as customers begin performing critical steps in implementing technologies – for instance, a doctor performing a collection or diagnostic step or a server user modifying a webpage. The divided infringement defense has grown more popular in recent years, paralleling the rising importance of method claims used to describe cutting edge computer software, business method inventions, and diagnostic and therapeutic inventions in biotech. This is particularly relevant where companies have been able to strategically avoid claims by performing less than all steps of a method claim and having their customers or other entities perform remaining elements of the claim.

This month, on September 16, 2012, post allowance proceedings as defined by the American Invents Act (AIA) begin, including Inter Partes review (IPR), Post Grant Review (PGR), and Business Method PGR. A table comparing these different post allowance proceedings, as well as current Ex parte reexamination proceedings, can be found at the end of this article, following a discussion of the various proceedings.

Patent prosecutors drafting claims that recite open-ended ranges (e.g., at least 10%, greater than 5 units) were again warned of the perils of claiming more than has been disclosed. In a recent decision by the Federal Circuit, MagSil Corp. v. Hitachi Global Storage Tech., Inc., the Court affirmed the trial court’s determination that the asserted claims were invalid as a matter of law for lack of enablement. The Court found that the open-ended range recited in the independent claim was not enabled because the disclosure provided support for only a small portion of the claimed open-ended range, citing to the dual function of enablement for both ensuring there is adequate disclosure to support a claimed invention and preventing claims broader than the disclosed invention. Patent practitioners reciting open-ended ranges should consider taking one or more steps to better ensure validity of their claims, including reciting the structure that enables the recited range in the claim, adding dependent claims that close the open-ended range, and providing examples in the specification that support a wide spectrum of values, and in particular values that fall within the high end of the open-ended range.

In a July 12, 2012 order, Suffolk Superior Court Justice Lauriat dismissed a lawsuit by urologist Dr. Grocela, asserting that his employer’s Intellectual Property (IP) policy as applied to him was an unfair restraint on trade since his employer, Massachusetts General Hospital (MGH), claimed ownership of an invention that was not related to urology. (The order, Grocela v. General Hospital Corp. also dismissed a complaint that MGH had breached Grocela’s right to privacy in violation of M.G.L.A. c. 214 §1B, which is not discussed.) The Court found that, as the IP policy was reasonably limited and Dr. Grocela had voluntarily chosen to avail himself of staff privileges, he must be bound by the terms of the policy.