Fingers Crossed: Supreme Court to Decide Patentability of Newly Discovered Natural PhenomenaThe Federal Circuit threw down the gauntlet, and we are waiting to see whether the U.S. Supreme Court will take it up. Sequenom’s petition for certiorari was scheduled for conference on June 23rd; the Court’s decision whether to hear the case will likely be announced next week. In the Federal Circuit en banc opinion denying rehearing of Ariosa v. Sequenom, Judge Lourie said “it is unsound to have a rule that takes inventions of this nature out of the realm of patent-eligibility,” and Judge Dyk added: “we are bound by the language of Mayo, and further guidance must come from the Supreme Court, not this court.”

The claims at issue in Sequenom’s patent were directed to methods for detecting paternally inherited cell-free fetal DNA (cffDNA) in maternal blood samples, useful for performing prenatal diagnosis. You can read more about the denial en banc here. In brief, the court was bound by the precedent of Mayo. The presence of paternally inherited cffDNA in maternal blood was a natural phenomenon, falling within a judicial exception to the general subject-matter eligibility of methods under § 101. After the claim elements that related to the natural phenomenon were removed from consideration, the remaining steps of the method were not enough to transform the claim into patentable subject matter under  what the Court described as “routine, conventional” laboratory techniques.

Sequenom’s petition for certiorari asks whether a novel method is patent-eligible where: (1) a researcher is first to discover a natural phenomenon; (2) that unique knowledge motivates him to apply a new combination of known techniques to that discovery; and (3) he thereby achieves a previously impossible result without preempting other uses of the discovery.

If the Court grants certiorari, then it will be partly because the en banc opinion and the 22 amici persuaded the Court that the way that the § 101 analysis is being applied is too broad, preventing the patenting of meritorious discoveries. In the en banc opinion, Judge Dyk explained:

“In my view, Mayo did not fully take into account the fact that an inventive concept can come not just from creative, unconventional application of a natural law, but also from the creativity and novelty of the discovery of the law itself. This is especially true in the life sciences . . . . I worry that method claims that apply newly discovered natural laws and phenomena in somewhat conventional ways are screened out by the Mayo test. In this regard I think that Mayo may not be entirely consistent with the Supreme Court’s decision in Myriad.”

While a complete review of the issues raised by the 22 amici are not discussed here, several themes emerged from a review of the arguments filed.

International Implications

Briefly, the Mayo/Myriad framework conflicts with internationally accepted standards of patent eligibility. The brief submitted by the Institute of Professional Representatives before the European Patent Office points out the Mayo/Myriad framework results in an overbroad application that is at variance with the EPC and the requirements of Art. 27 of the TRIPS treaty. For example, in Genetic Technologies v. Merial, the Federal Circuit recently held the claims invalid, whereas a parallel patent application was granted by the EPO without objection as to eligibility. As it stands, the Federal Circuit is applying a rigid rule in which claims directed to a newly discovered law of nature, natural phenomenon, or an abstract idea cannot rely on the novelty of that discovery for the inventive concept. In contrast, the EPC allows claims directed to a discovery of laws of nature, natural phenomena, and abstract ideas if the discovery is put to practical use.

Mayo/Myriad Overbroad when Applied to Diagnostics

Population Diagnostics et al. and BIO echo the idea that the Mayo/Myriad framework is applied too broadly, explaining that courts and the USPTO, when faced with a claim that contains a judicial exception, reflexively invalidate the claim. “A natural substance being measured is labeled as a ‘natural phenomenon’ and a medical condition is labeled a ‘law of nature.’” Once step one of the Mayo test has been dispensed with, the claim elements are either: “(i) ignored; (ii) examined individually in isolation and found in isolation to be conventional; or (iii) examined as a combination – independent of their combined effect with the judicial exception – and again found to be conventional. In none of this analysis is the claim considered as a whole.”

In the Institute of Professional Representatives brief, this overbroad analysis is applied to something everyone understands: a hypothetical patent application with method claims for making an omelet. Beginning with step one of the Mayo test, the omelet method claims are “directed to” a product of nature. The method begins with eggs, ends with an egg product and is therefore “directed to” eggs. The transformation of the egg to an omelet is overlooked because cooking food in a pan is routine and conventional. Similarly, in Ariosa, the amplification step, the resulting amplified sequences, and the new utility of the amplification product were overlooked, and the claims held as directed to patent ineligible subject matter.

Certainty in Patent Law Drives Innovation

Several amici discuss the unintended consequences of this overbroad application of the Mayo/Myriad. The Amarantus Bioscience Holdings brief relates how potential investors have refused to invest in their promising biotechnology because patents in this area cannot be trusted. Lack of investment capital can kill new companies or prevent them from forming in the first place. Prior to Mayo/Myriad, the PTO issued some 40,000 DNA-related patents, covering about 20 percent of the genes in the human genome, giving investors certainty as to the enforceability of gene patents.

Obviously, the Court did not give much weight to longstanding PTO practice in deciding Mayo/Myriad, radically changing the enforceability of gene patents. However, longstanding PTO practice was used to decide a recent Federal Circuit case. The plaintiff in Immersion v. HTC challenged the longstanding PTO practice of filing a continuation on the same day as the parent application issues a patent (same-day continuation). The Federal Circuit relied on the “longstanding administrative construction” doctrine in upholding the use of same-day continuations: Adopting “HTC’s position would disturb over 50 years of public and agency reliance on the permissibility of same-day continuations . . . and would affect the priority dates of more than ten thousand patents.”

It is puzzling why the U.S. Supreme Court did not use “longstanding administrative construction” to uphold the pre-Myriad/Mayo/Alice interpretation of § 101. That ship has sailed, although the effects are manifold. Since 86 percent of diagnostic patent applications receive § 101 rejections, the validity of issued claims is in jeopardy. Hopefully, the Court will grant certiorari and refine the test so that certainty in patent law will incentivize development and disclosure to the benefit of the public.