#14153 - Patent Law - Patent Law

Patent Law Main Outline

Fall 2015

University of Virginia – Prof. John Duffy

POLICY:

• Why do we want to grant any property rights for innovations?

• Why are the property rights that we do permit so heavily restricted (e.g., ending after only 20 years)?

• Incentive to Create Theory: patents allow for an optimal return on investment for R&D

  • Even without patents, innovation occurs (e.g., marijuana) but there may be sub-optimal ROI

• Prospect Theory: investment/R&D can happen after application for or after granting of a patent (Xerox: product in market much after patent granted)

• First Mover Advantage: first to bring to market will get ROI before copies made

• Regulatory Problem: e.g. pollution - absence of regulation = too much polluters

  • Patent system is the opposite (i.e., a Positive Externality): absence of regulation = too little innovation

• Coase: w/ well-defined property rights and zero transaction costs, there would be efficient R&D, thus no patents needed. Externalities make the patent system necessary

• Competition: patents limit short-term price competition but encourage long-term research competition (it “orders” competition, not limits it) - w/o patents we would have the opposite result

• Natural Monopoly Problem: high development costs but low costs of production thereafter

  • Innovation Costs: high initial cost, i.e., a higher first unit cost, with lower marginal cost

  • Possible Solutions from Friedman:

    • (1) State ownership (now “public domain” subsidy)

    • (2) Private monopoly with regulation

    • (3) Unfettered private monopoly: complete private monopoly

  • Partial Property Rights:

    • Canada pharma: price regulation w/ compulsory licenses

    • Temporarily Limited Franchise: like patents today

    • Other limitations: fair use, first sale, libraries

• Patentability: should 101 track trends in technology? See e.g. financial engineering

• Concern for the need for more investigation:

  • See 101 Mayo, Morse

  • See Utility Brenner

  • See Enablement: Edison

Ch. 1: Introduction

• Patent:

  • (1) Qualifying Inventions: new, useful and not obvious

  • (2) Disclosure Required: must disclose information to allow others to practice the invention

  • (3) Rights Conferred: certain exclusive rights precluding anyone from making, using, offering for sale, selling or importing the invention

• Historical Overview of Patent Law: slides 16-19, with lessons on 20

• The Architecture of a Modern Patent

  • Specification/Drawings

  • Claims: Claims must “particularly point[] out and distinctly claim[] the subject matter which the applicant regards as his invention.” 35 U.S.C. § 112

    • Preamble: must start with “I claim” or “we claim”

      • Includes what is not part of your invention because may not count for infringement analysis (e.g., airplane seats for an airplane tray table invention)

    • Transition Words:

      • “Open” Claims: “Comprising”

      • “Closed Claims: “Consisting of”

      • “Consisting Essentially of” = in between

        • Can include additional unclaimed elements IFF they do not make the variant essentially different from the claimed invention

      • “The combination with [elements] of [more details]”

      • DUFFY: if evaluating a claim, too narrow a transition word is considered a problem

    • Body of the claim

      • Claim Definiteness:

        • Must be able to determine the scope of the claim, see definiteness, as well as Written Description and Enablement for what’s in the spec.

        • No words like “should,” but “approximately” is more of a gray area

      • Three Formal Requirements for Claim Drafting

        • (1) Single Sentence

        • (2) No Freestanding Elements: must set forth how each element interacts with at least one other element

        • (3) Antecedent Basis: claim references to previously mentioned elements must be clear

      • Independent & Dependent Claims

        • Independent Claim: may not refer to any other claims (“A windmill comprising…”)

        • Dependent Claim: depends on a prior independent claim (“The window according to claim 1, wherein/further comprising…”)

          • Must narrow the independent claim

          • Insurance against granted but overly broad independent claims

          • Helps expedite patent process to find patentable claim scope

        • Multiple Dependent Claims: may not depend from other multiple dependent claims

        • Combination Claims: “the combination of _(1)_ with _(2)_”

          • Older way of claiming things

          • May run into obviousness issues

      • Means-Plus-Function Elements

        • Cannot have single means claim, you need a combination (i.e., at least two elements) per 35 U.S.C. § 112(6) or 112(f)

        • See Definiteness under Written Description requirement

        • See Equivalents of disclosed structure in Claim Interpretation in Infringement

      • Relation to Written Description Requirement:

        • Unclear terms must be found in the spec

      • Jepson Claims: claiming improvement on works of others (“A __, wherein the improvement comprises __”)

        • Stuff before the improvement is considered prior art or known

      • Negative Limitations

        • Only permitted when there is a proper foundation in the patent specification

        • Sontarus Inc. v. Par Pharmaceutical, Inc. (Fed. Cir. 2012): According to 112(a) written description requirement: negative claim limitations are adequately supported when the specification describes a reason to exclude the relevant limitation

      • Additional information

        • “Wherein” is always attached to an element

      • DUFFY on Claim Scope: when reviewing claims, always think what language/limitations could be taken out (i.e. what narrows it too much?)

• Overview of the Patent System (see slides)

• Globalization and Patent Rights (slide 48, p. 55–67)

  • Late 19th Century: Paris Convention

  • 1970s: Process Consolidation

  • TRIPS: Substantive Harmonization

    • The Patent Term

    • Provisional Applications

    • Eighteen Month Publication of Applications

  • Continuing Evolution

Ch. 2: Patentable Subject Matter - 35 U.S.C. § 101

• 35 U.S.C. § 101: Inventions patentable. Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.

  • Broadly interpreted (includes “anything under the sun that is made by man” Chakrabarty quoting S. Rep.), but subject to two types of exclusions

    • General Exclusions: principles of nature, natural products, physical phenomena, abstract ideas

      • POLICY: these run into problems with other doctrines

        • Novelty: things in nature aren’t new

        • Utility: new law of nature is merely an explanation, not a useful application

        • Abstraction: if it’s too abstract, the legal system may be unable to define property rights

        • Public policy: basic science should be available to all

        • Mental Steps: patents are not meant to cover processes of the human mind

        • Other IP: patents are not supposed to cover that which is covered by copyrights

    • Field Restrictions: specific legislative exclusions from patentability (e.g. some nations exclude surgical methods or business methods)

• Naturally Occurring Things: Living Things & Natural Phenomena

  • Overview:

    • There is no per se rule against patenting living things (Chakrabarty)

    • Current Two Step Process: (From Alice, applied in Ariosa Diagnostics)

      • (1) Are the claims directed to a patent-ineligible subject matter? (but isn’t everything abstract or natural to some degree?)

        • Natural: DNA and blood samples (Ariosa)

        • Natural: Naturally occurring plasmids (Chakrabarty)

        • Natural: Level of compound in blood (Mayo)

        • Natural: Isolated DNA (Myriad)

        • Natural: Non-modified bacteria

        • Y/N Natural: Electrical signals (O’Reilly v. Morse & Telephone Cases)

        • N Natural: Synthetic non-naturally occurring cDNA (Myriad)

      • (2) If yes, do the claims recite additional elements that “transform the nature of the claim” into a patent eligible application (step-by-step, and then as a whole)

        • N: Describe the natural relation (Mayo)

        • N: Simple Application of Discovered Phenom. !patentable (Funk Bros.)

        • N: Isolated natural thing (Myriad)

        • Maybe: Measurement method or actual dosage adjustment (see Mayo)

        • Y/N: Limited to structure beyond overly broad new principle (compare O’Reilly v. Morse to Telephone Cases)

        • Y: Genetic modification (Chakrabarty)

  • Cases:

    • Ariosa Diagnostics, Inc. v. Sequenom, Inc. (Fed. Cir. 2015, supplement) two step process for claims directed to ineligible SM

      • FACTS: diagnostic method claims directed toward isolating plasma from a maternal blood sample, and amplifying/isolating paternally inherited nucleic acid, and detecting the paternally inherited nucleic acid.

      • RULE: two step process (adding to Mayo?)

        • (1) Are the claims directed to a patent-ineligible subject matter?

          • DUFFY: everything can be thought of as an abstract idea/law of nature/etc., so the second prong is really all that matters

        • (2) If yes, do the claims recite additional elements that “transform the nature of the claim” into a patent eligible application

          • Two Parts:

            • (a) Look at each element alone - is it beyond the abstract idea and was it in the prior art?

            • (b) Look at the combination - does it add more over prior art? (Duffy thinks Ariosa missed this step, so came out wrong)

      • HOLDING:

        • (1) Claims were directed toward cffDNA which is naturally occurring

        • (2) Claims start with nucleic acid (naturally occurring) and end with paternal cffDNA (also naturally occurring and known), and the intermediate process of amplification was well-known. Since the only thing “new” was the discovery of paternal cffDNA in maternal blood, so there is not enough to make take this out of the barred category of natural phenomena

          • IMPORTANT: looks at the claim step-by-step, not as a whole (the claim was for a new way of getting paternal cffDNA,...