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Federal Circuit Review FEDERAL CIRCUIT REVIEW § 101 PATENTABILITY This issue will focus on the categories of invention that qualify for patent VOLUME TWO | ISSUE FOUR protection, as set forth in 35 U.S.C. § 101. In October 2008, the Federal Circuit issued an en banc decision reversing its prior precedent and holding JANUARY 2010 that a business method is not a patent-eligible “process” under 35 U.S.C. § 101. In re Bilski, 545 F.3d 949 (Fed. Cir. 2008) (en banc), cert. granted (U.S. Jun. 1, 2009) (No. 08-964). The en banc decision set forth a new IN THIS ISSUE: “machine-or-transformation” test to determine whether a claimed method constitutes a patent-eligible “process.” This year, the Supreme Court g The Supreme Court Appeal granted certiorari to consider the Bilski decision. The Court heard oral of In re Bilski argument on November 9, 2009, but has not yet issued a decision. The Bilski Supreme Court appeal has generated substantial interest across many g Federal Circuit Decisions disparate industries, including hardware and software companies, biotech, After Bilski information technology and financial firms, and drug makers. A decision is expected in the spring or summer of 2010, and is expected to modify or g PTO Guidelines replace the machine-or-transformation test. Meanwhile, the Federal Circuit has worked to sharpen and clarify its new machine-or-transformation test. Over the past year, the Federal Circuit has issued three decisions applying the machine-or-transformation test. The Federal Circuit reached opposite patent eligibility determinations in two decisions involving different medical diagnostic method claims. Compare Prometheus Laboratories, Inc. v. Mayo Collaborative Services, 581 F.3d 1336 (Fed. Cir. 2009) with Classen Immunotherapies, Inc. v. Biogen IDEC, 304 Fed. Appx. 866 (Fed. Cir. 2008). Another decision found a method for marketing a product not eligible for patent protection. In re Lewis Ferguson, 558 F.3d 1359 (Fed. Cir. 2009). In addition, the Patent and Trademark Office also issued interim Guidelines regarding the application of the machine-or-transformation test pending the Supreme Court’s decision in Bilski. www.willkie.com FEDERAL CIRCUIT REVIEW THE SUPREME COURT APPEAL OF IN RE BILSKI The Supreme Court granted certiorari in the Bilski case on June 1, 009. Before the Supreme Court are two questions: 1. Whether the Federal Circuit erred by holding that a “process” must be tied to a particular machine or apparatus, or transform a particular article into a different state or thing (“machine- or-transformation” test), to be eligible for patenting under 35 U.S.C. § 101, despite this Court’s precedent declining to limit the broad statutory grant of patent eligibility for “any” new and useful process beyond excluding patents for “laws of nature, physical phenomena, and abstract ideas.” . Whether the Federal Circuit’s “machine-or-transformation” test for patent eligibility, which effectively forecloses meaningful patent protection to many business methods, contradicts the clear Congressional intent that patents protect “method[s] of doing or conducting business.” 35 U.S.C. § 73. The Bilski appeal has drawn intense interest and attention — arguably, more than any other patent case in U.S. history. About 70 amicus briefs on the merits were filed with the Supreme Court. Although views varied widely, many amici criticized the Federal Circuit’s test, answering the first question presented (above) in the affirmative and arguing that the machine-or-transformation test should not be exclusively applied. With regard to the second question, amici differed on whether the Supreme Court should establish patent eligibility criteria that ensure the continued viability of business method patent claims. The Supreme Court heard oral argument on November 9, 009. During oral argument, the Justices criticized positions taken by both sides, but seemed aligned in questioning the patentability of business methods and in broadly considering whether the machine-or-transformation test would appropriately limit the patent eligibility of certain processes without deterring advancements in areas such as software and biomedical arts. The Justices explored both prongs of the machine-or-transformation test, asking how much machine involvement or transformation, respectively, would be required to render a process patent eligible. Based on questions from the Justices at oral argument, it appears likely that Bilski’s particular claims, and other pure business methods, will be found not eligible for patent protection. The fate of the machine-or-transformation test itself is uncertain – in all likelihood, the Court will modify or replace the test. However, during oral argument, the Court struggled with appropriate boundaries for the types of processes deserving patent protection. FEDERAL CIRCUIT DECISIONS AFTER BILSKI Since its en banc decision in Bilski, the Federal Circuit has issued only three decisions applying the machine-or-transformation test to process claims. Prometheus Laboratories, Inc. v. Mayo Collaborative Services, 581 F.3d 1336 (Fed. Cir. 009); Classen Immunotherapies, Inc. v. Biogen IDEC, 304 Fed. Appx. FEDERAL CIRCUIT REVIEW 866 (Fed. Cir. 008); and In re Lewis Ferguson, 558 F.3d 1359 (Fed. Cir. 009). Four cases have been stayed pending the Supreme Court’s decision in Bilski.1 Meanwhile, one case continues to proceed with the appellant’s principal brief due March 1, 010. CLASSEN V. BIOGEN In Classen Immunotherapies Inc. v. Biogen IDEC, 006 U.S. Dist. LEXIS 98106 (D. Md. Aug. 16, 006), the district court granted the defendant’s summary judgment motion to invalidate the asserted claims as “an attempt to patent an unpatentable natural phenomenon.” Id. at *15. Exemplary claim 1 of U.S. Patent No. 5,73,83, recites: A method of determining whether an immunization schedule affects the incidence or severity of a chronic immune-mediated disorder in a treatment group of mammals, relative to a control group of mammals, which comprises immunizing mammals in the treatment group of mammals with one or more doses of one or more immunogens, according to said immunization schedule, and comparing the incidence, prevalence, frequency or severity of said chronic immune-mediated disorder or the level of a marker of such a disorder, in the treatment group, with that in the control group. The district court determined that “[c]learly, the correlation between vaccination schedules and the incidence of immune mediated disorders that Dr. Classen claims to have discovered is a natural phenomenon. The issue, therefore, is whether the Classen patents simply describe this correlation.” Id. at *13. The district court found that “the 283 patent describes only a general inquiry of whether the proposed correlation between an immunization schedule and the incidence of chronic disorders exists. As such, the process is indistinguishable from the idea itself.” Id. at *13-14. The district court further found that claims including “the active step of immunizing patients in accordance with a schedule determined to be low risk” did not render the claims patentable as “‘[i]nsignificant post-solution activity will not transform an unpatentable principle into a patentable process.’” Id. at *15 (internal citing omitted). The Federal Circuit affirmed the district court’s summary judgment that the claims are invalid under § 101 in a short non-precedential opinion. The court held that “Dr. Classen’s claims are neither ‘tied to a particular machine or apparatus’ nor do they ‘transform[] a particular article into a different state or thing.’” Classen Immunotherapies Inc. v. Biogen IDEC, 304 Fed. Appx. 866, 867 (Fed. Cir. 009) (citing Bilski, 545 F.3d at 954). 1 DealerTrack, Inc. v. Huber, No. 06-cv-2335, slip op. (C.D. Cal. Jul. 7, 2009), appeals stayed, No. 2009-1566 and No. 2009-1588 (Fed. Cir. Oct. 27, 2009) (appeal from order granting summary judgment); Every Penny Counts, Inc., v. Bank of America Corp., No. 2:07-cv- 042, slip op. (M.D. Fla. May 27, 2009), appeal stayed, No. 2009-1442 (Fed. Cir. Aug. 31, 2009) (appeal from order granting summary judgment); CyberSource Corp. v. Retail Decisions, Inc., No. 3:04-cv-03268, slip op. (N.D. Cal. Mar. 27, 2009), appeal stayed, No. 2009- 1358 (Fed. Cir. Jul. 30, 2009) (appeal from order granting summary judgment); and Fort Properties, Inc. v. American Master Lease, LLC, No. 8:07-cv-365, slip op. (C.D. Cal. Jan. 22, 2009), appeal stayed, No. 2009-1242 (Fed. Cir. Jun. 11, 2009) (appeal from order granting summary judgment). 2 Research Corporation Technologies, Inc. v. Microsoft Corp., No. 01-cv-658, slip op. (D. Ariz. Jul. 28, 2009), appeal docketed, No. 2010- 1037 (Fed. Cir. Oct. 22, 2009) (appeal from order granting partial summary judgment). 3 FEDERAL CIRCUIT REVIEW PROMETHEUS V. MAYO In Prometheus Laboratories, Inc. v. Mayo Collaborative Services, 581 F.3d 1336 (Fed. Cir. 009), the Federal Circuit reversed a district court’s pre-Bilski summary judgment decision invalidating process claims involving medical diagnostics. The asserted patent claims relate to methods for identifying metabolites of thiopurine, a drug used to treat various gastrointestinal disorders such as Crohn’s disease and ulcerative colitis. Claim 1 of U.S. Patent No. 6,355,63 is representative: A method of optimizing therapeutic efficacy for treatment of an immune mediated gastrointestinal disorder, comprising: (a) administering a drug providing 6-thioguanine to a subject having said immune-mediated gastrointestinal disorder; and (b) determining the level of 6-thioguanine in said subject having said immune-mediated gastrointestinal disorder, wherein the levels of 6-thioguanine less than about 30 pmol per 8x108 red blood cells indicates a need to increase the amount of said drug subsequently administered to said subject and wherein the levels of 6-thioguanine greater than about 400 pmol per 8x108 red blood cells indicates a need to decrease the amount of said drug subsequently administered to said subject. The district court invalidated the patent claims as unpatentable natural phenomena under § 101.
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