[This article deals with patenting issues not GMOs per se.]
Justices Reach Out to Consider Patent Case
By Andrew Pollack
New York Times
March 20, 2006
For the first time in a quarter-century, the Supreme Court will hear on Tuesday a case involving the basic question of what type of discoveries and inventions can be patented.
Both sides say the case, which involves a blood test for a vitamin deficiency, could have a wide-ranging impact on the development of diagnostics, perhaps threatening many of the underlying patents for genetic and other medical tests.
But the array of companies filing supporting briefs - including American Express, Bear Stearns and I.B.M. - indicates that intellectual property in other fields might also be affected.
Some patent specialists say they think the Supreme Court agreed to hear the case, against the advice of the United States solicitor general, to rein in patenting.
"The Supreme Court reached out and grabbed this case," said Edward R. Reines, a patent attorney at Weil, Gotshal & Manges who is not involved in the case. "These circumstances suggest that some members of the court believe there are too many patents in areas where there should be none."
At issue is whether relationships between a substance in the human body and a disease - for example, the familiar association between high cholesterol and a higher risk of heart attacks - can be the basis of a patent, or whether such relationships are unpatentable natural phenomena.
This case, LabCorp v. Metabolite Laboratories, stems from a 1990 patent awarded to scientists at the University of Colorado and Columbia University. They found that a high level in the blood of homocysteine, an amino acid, indicated a deficiency of either vitamin B12 or another B vitamin called folic acid.
Much of the patent describes a specific way to measure homocysteine, and those claims are not at issue. But the 13th claim of the patent is more general: it covers a way of determining vitamin deficiency by first testing blood or urine for homocysteine by any means and then correlating elevated levels with a vitamin deficiency.
The patent is owned by Competitive Technologies, a publicly traded patent management firm in Fairfield, Conn., and licensed to Metabolite Laboratories, a tiny company based at the University of Colorado. LabCorp, one of the biggest clinical testing companies in the nation, with 2005 revenues of $3.3 billion, sublicensed the test from Metabolite.
At first, LabCorp, whose full name is Laboratory Corporation of America Holdings, tested for homocysteine using the specific method described in the patent and paid royalties to Metabolite and Competitive Technologies. But in 1998 it switched to a newer and faster test developed by Abbott Laboratories.
Metabolite and Competitive sued, charging LabCorp with violating Claim 13 of the patent. In 2001 a federal jury in Denver ruled against LabCorp, and the company was eventually ordered to pay $7.8 million in damages and attorneys' fees. The appeals court that handles patent cases affirmed the lower court decision in 2004.
In asking the Supreme Court to overturn the lower court decisions, LabCorp is arguing that Claim 13, because it does not specify how testing is to be done, patents nothing more than the natural relationship between homocysteine and vitamin B deficiencies, blocking other inventors from developing better tests.
"The present-day implications of such a holding are limitless - and dangerous," LabCorp wrote in its brief. "Anyone who discovers a new medical correlation could stifle medical treatment through a 'test plus correlate' claim."
But Metabolite and its allies argue that such correlations are the basis of diagnostics and that not allowing patents would stifle development of new tests. There are tests, for instance, that look at mutations in particular genes to predict a high risk of breast cancer or to predict which AIDS drugs will not work.
"Hundreds, if not thousands, of patents would at once be called into question" if the ruling goes against Metabolite, said a brief jointly submitted by Perlegen Sciences, a company developing genetic tests, and Mohr Davidow Ventures, a venture capital firm that backs diagnostics companies.
Another question in the case is whether doctors could infringe the patent merely by looking at a test result for homocysteine and then thinking about vitamin deficiency. Indeed, the lower courts said LabCorp had not directly infringed but rather had induced doctors to infringe by performing the correlation.
Partly with that in mind, the American Medical Association, the American Heart Association and AARP have submitted briefs in support of LabCorp, arguing, in the words of the heart association, that the patent could have "devastating effects on patient health care."
Millions of homocysteine tests are done each year because high levels of the amino acid are associated with an increased risk of heart attack, stroke, birth defects and other diseases; people often take B vitamins to lower homocysteine and reduce the risk. (Clinical trial results announced last week, however, suggested that taking B vitamins did not prevent heart attacks.)
Court precedents have held that laws of nature, natural phenomena and abstract ideas cannot be patented. "Einstein could not patent his celebrated law that E = mc2; nor could Newton have patented the law of gravity," the Supreme Court wrote in a 1980 decision.
But in a 1981 decision in Diamond v. Diehr - the last time the Supreme Court considered the issue - the court upheld a patent on a method of curing rubber that made use of a well-known equation governing chemical reactions. The court said that the equation was only part of a broader invention.
Glenn K. Beaton, an attorney for Metabolite, said that as in that 1981 case, "it's not the correlation itself that is patented here," but rather "the use of that correlation to determine B12 and folate deficiencies."
In recent years, controversial patents have been granted on software and on business methods, such as ways of managing investment portfolios or of allowing people to order merchandise on Amazon.com with one click of a mouse.
Bear Stearns, Lehman Brothers and the Computer and Communications Industry Association filed briefs urging the court to use the LabCorp case to restrict such business method patents, or at least not expand them. Other companies, including American Express and I.B.M., say the LabCorp case is not relevant to business method patents.
The solicitor general, in urging the court not to hear the case, said there was not enough of a record from the lower courts on the question of patenting natural phenomena. That is because LabCorp did not raise that argument in the lower courts, instead trying to get the claim invalidated on other grounds. If LabCorp wins the case in a way that weakens patents on diagnostic tests, it could be one of the bigger losers. The company, based in Burlington, N.C., is counting on high-priced, patented genetic tests to fuel its growth.
Bradford T. Smith, executive vice president for corporate affairs at LabCorp, disputed that. "We think this case can be decided very narrowly," without undermining other patents, many of which rely on more than just correlations, he said.
New York Times, Editorial
March 22, 2006
Something has gone very wrong with the United States patent system.
Americans think of the granting of patents as a benevolent process that lets inventors enjoy the fruits of their hard work and innovations. But times have changed. The definition of what is patentable has slowly evolved to include business practices and broad ideas. The fact that the Smucker's company went to court over patents on peanut butter and jelly sandwiches might have provoked chuckles. But it became a symbol of a system gone awry.
Technological advances raise new questions with each passing year. Should genes be patentable? What about life forms? The high-tech and pharmaceutical industries find themselves at odds on reform because patents affect their businesses so differently. The understaffed Patent and Trademark Office needs to draw the line between a real innovation and an obvious concept that should be freely available as a building block for future generations of creative thinkers.
Meanwhile, profiteers, including lawyers and hedge funds, have turned the very purpose of patent rights - to encourage people to invent and produce - on its head, using them to tax, blackmail and even shut down productive companies unless they pay high enough ransoms. These so-called patent trolls have emerged as the villains in this intellectual property debate.
The possibility of this sort of abuse is inherent in the concept of patents, which in this country allow no one to produce or sell a patented product for up to 20 years without a license from the patent holder. Our nation's founders considered intellectual property important enough to include in the Constitution, but did not establish the system for the sake of the inventor. It exists for the sake of society, or, as it says in the Constitution, "to promote the progress of science and the useful arts."
Now the pendulum has swung so far in the direction of the patent holder that many experts say we are not only restricting competition, but discouraging research and innovation as well. More patents are slipping through that are not new, like the peanut butter and jelly sandwich, or that should be obvious, like the migration of a simple business practice onto the Internet or a mobile device.
The problem lies not just with the short-staffed patent office, but also with the courts. The ease with which patent holders can get an injunction to shut down a thriving business means that many companies are quietly paying rather than fighting.
The recent threat that BlackBerry service might be shut down by an injunction caught everyone's attention. The patent office found that the three disputed patents should not have been granted in the case of the BlackBerry, a popular wireless communications device. Yet Research in Motion, the company that makes it, settled for a staggering $612.5 million to avoid an injunction.
The Supreme Court now appears ready to weigh in and - we hope - restore some sanity to the system. Yesterday the court heard arguments on whether the patent for a blood test for a vitamin deficiency was so broadly construed that it included a natural process of the human body and the idea of how to interpret it. Such a patent could prevent other inventors from developing new and better tests. The court will also hear arguments next week in a case attacking eBay, the global marketplace.
The court will not be able to solve the problem by itself, no matter how wise its ultimate rulings. The patent office, which handles three times as many applications as it did in 1985, has to be upgraded to meet the 21st century. There is legislation in the House to address that issue, and it needs to be taken up. By giving other people or companies the right to submit documentation before patents are granted and to challenge decisions, patents' quality could be improved and the courthouse avoided.