Category Archives: Patents

The Supreme Court’s Denial of Patent Protection for Human Genes

By Katie Podein

In a recent unanimous ruling, the U.S. Supreme Court held that human genes are not patentable… or at least not natural human genes.  Although all nine Justices said that naturally occurring, isolated biological material is not patentable, their ruling was still a compromise in that it allowed for the possibility of a patent on the synthetic version of the genetic material.

Back in 2009, a coalition of researchers, genetic counselors, cancer survivors, breast cancer support groups, and scientific associations filed suit against Myriad Genetics, a Utah biotechnology company, challenging the company’s patent of genes BRCA1 and BRCA2.  Myriad discovered and isolated the two genes, BRCA 1 and BRCA 2, which are highly associated with hereditary breast and ovarian cancer. Myriad patented its discovery, allowing the company a monopoly over the use, research, diagnostics and treatment of the genes.  Myriad was also the only company that could perform tests for potential abnormalities.  In April 2013, the Supreme Court began the trial on whether researchers and scientists are able to claim human DNA as their intellectual property.  Specially, the issue focused on whether “products of nature” can be treated the same as “human-made” inventions in order for the individuals and companies who have isolated the specific genes to have the exclusive intellectual property rights to these genes.

The Supreme Court found that Myriad did not create or invent anything for purposes of patent law. “Myriad did not create or alter any of the genetic information encoded in the BRCA1 and BRCA2 genes,” Justice Clarence Thomas said in writing for the Court.  “[Myriad] found an important and useful gene, but separating that gene from its surrounding genetic material is not an act of invention,” Justice Thomas further clarified.  In the ruling, the Supreme Court also supported the Obama administration’s position that although DNA is not patentable by itself, Complementary DNA, or “cDNA” can be.  Complementary DNA is artificially synthesized from the genetic template and engineered to produce gene clones.  Justice Thomas stated that “cDNA does not present the same obstacles to patentability as naturally occurring, isolated DNA segments.”

This compromise ruling does not come as a shock to the public since the Justices have previously expressed their hesitance to allow for patents on human genes and have noted the profound impact it would have on pharmaceuticals and genetically modified crops.  However, one surprise in the ruling was that all but one Justice signed off on the ruling; Justice Anton Scalia wrote a separate opinion agreeing with all parts of the opinion except Part I-A, the paragraph that describes what genes are, what they do and how they’re created.  Scalia wrote, “I am unable to affirm those details on my own knowledge or even my own belief.”

Regardless of Scalia’s understanding or belief of genes, this ruling has already had a major impact on the medical community.  Immediately after the ruling, at least three companies and two university labs said that they would now begin offering genetic testing in the field of breast cancer.  In addition to the expected expansion of companies’ abilities to offer genetic testing, the patient costs of these tests are also expected to fall.  Dr. Harry Ostrer, a professor at Albert Einstein College of Medicine and director of genetic and genomic testing at Montefiore Medical Center in New York said, “I’m thrilled.  We can offer BRCA 1 and 2 testing to low-income women without concerns about how it will be paid for.”   Furthermore, scientists will be able to research the BRCA genes without fear of being sued.

Even Myriad found solace in the ruling. Peter D. Meldrum, president and chief executive officer of Myriad, said the company believed that the court “appropriately upheld our claims on cDNA.”  He also stated that the ruling “underscored the patent eligibility of our method claims, ensuring strong intellectual property protection for our BRACAnalysis test moving forward.”

 

Katie Podein is an associate attorney at Yang & Wang, P.C, practicing Intellectual Property and Business Law.  The firm’s practice includes patent; trademark; trade dress; trade secret; copyright; internet & new media; brand protection; and general corporate, organizational, and business law matters.

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Patent Exhaustion and the Curious Case of Bowman v. Monsanto

by Azita Mirzaian

For months, patent law scholars and biotech companies alike have awaited the U.S. Supreme Court’s decision in Bowman v. Monsanto, a case that arose from a dispute between an Indiana farmer and agribusiness giant Monsanto.  The Bowman decision was expected to addresses a very key question pertaining to patent law: whether or not “patent exhaustion” limits the rights of patent holders by eliminating the right to control or prohibit use of an invention after an authorized sale.  More specifically, the decision was expected to address “patent exhaustion” as it applies to self-replicating technologies such as seeds.

On May 13, 2013 the U.S. Supreme Court finally issued its much-anticipated decision, but ultimately tailored it so narrowly that the Court essentially just re-affirmed the doctrine of patent exhaustion as it currently stands.

The Doctrine of Patent Exhaustion

Patent exhaustion, a long-standing concept in patent law, can serve as a valid defense to patent infringement claims.  Patent exhaustion is the concept that if a patent-holder authorizes a first sale of a patented product or an article that embodies an invention, that authorized sale exhausts the patent-holder’s rights in the article sold.

In 1942, in United States v. Univis Lens Co., the U.S. Supreme Court held that patent exhaustion applies to authorized sales, notwithstanding any post-sale restrictions that the patent-holder wishes to place on end-purchasers.  In the 1992 case Mallinckrodt, Inc. v. Medipart, Inc., the Federal Circuit created a “conditional sale” exception to patent exhaustion, finding that exhaustion applies only to an authorized an unconditional sale – in other words, if a sale or license is expressly conditional, then patent exhaustion does not apply.  The Mallinckrodt case has been viewed by some as a questionable decision that is inconsistent with the U.S. Supreme Court’s precedent regarding patent exhaustion.

Monsanto’s Case against Bowman

In this case, Monsanto developed and patented (via several patents) a certain biotechnology whereby a gene was transferred into seeds in order to make the seeds resistant to an herbicide that Monsanto manufactures called Roundup.  These “Roundup-Ready” seeds can be planted and will produce crops that, when sprayed with the Roundup herbicide, will remain undamaged.  Monsanto authorizes sales of these Roundup-Ready seeds to farmers who agree to Monsanto’s Technology Agreement, which prohibits farmers from, among other things, using the seeds in more than one season, supplying the seeds to others for planting, and saving crops produced from the seeds for replanting.  Monsanto’s restrictions on the uses of the seeds are a direct result of the self-replicating nature of its patented biotechnology; Roundup resistance is not only displayed in the genetically-altered first-generation seeds, but in subsequent generations of seeds produced from the first-generation seeds.

In 2002, Indiana farmer Vernon Bowman purchased some of Monsanto’s Roundup-Ready soybean seeds for his first-crop harvest and signed a Technology Agreement that restricted his use of the seeds.  In accordance with the Technology Agreement that he signed, he did not save seeds from his first-crop harvest.  Around that same time, Bowman also purchased some considerably cheaper “commodity” seeds from a local grain elevator to use for his second-crop soybeans – these commodity seeds were a mixture of seeds from various sources, including Monsanto.  From year to year, Bowman saved seeds harvested from this second-crop harvest and replanted them, noticing that they were Roundup resistant.

Eventually, Monsanto accused Bowman of saving seeds in violation of the Technology Agreement that he had signed.  Bowman argued that he had only saved and replanted the commodity seeds from the grain elevator (an established and common practice among farmers), not the seeds from the first-crop harvest of Roundup-Ready seeds that were covered by the Technology Agreement.  Nonetheless, in 2007, Monsanto sued Bowman, alleging infringement of two of the patents that cover its Roundup-Ready seed technology.

In 2009, the District Court for the Southern District of Indiana granted Monsanto’s motion for summary judgment on patent infringement, stating that, “despite [Mr.] Bowman’s compelling policy arguments addressing the monopolizing effect of the introduction of patented genetic modifications to seed producing plants on an entire crop species, he has not overcome the patent law precedent which breaks in favor of Monsanto[.]”  The District Court awarded damages in the amount of $84,456 to Monsanto.

In 2011, the Court of Appeals for the Federal Circuit affirmed the District Court’s decision. The Court rejected the argument that patent exhaustion permitted Bowman to save and replant commodity seeds, holding that by using the commodity seeds for a natural and foreseeable purpose (planting), he “created a newly infringing article.”  Furthermore, the Court stated that the “fact that a patented technology can replicate itself does not give the purchaser the right to use replicated copies of the technology.”  The Court’s conclusion that farmers have “the right to use commodity seeds… for any other conceivable use, [but] they cannot ‘replicate’ Monsanto’s patented technology by planting it in the ground to create newly infringing” articles, is somewhat curious, given that the most obvious, primary thing to do with a seed is plant it.  The Court of Appeals’ decision was partially based on the “conditional sale” exception to patent exhaustion.

The Supreme Court’s Decision

The applicability of patent exhaustion to self-replicating patented technologies raised a novel question for the U.S. Supreme Court.  The Court’s grant of certiorari caught the attention of patent law scholars and biotech companies alike, who all wondered if the Court could potentially eliminate patent exhaustion as a viable defense to patent infringement claims pertaining to self-replicating technologies.

On May 13, 2013, the Supreme Court issued its decision in the case, which, while unanimous, was narrowly tailored enough that it didn’t have the sweeping effect on patent law that many were expecting.  The Court affirmed the decisions of the District Court and the Court of Appeals, ruling that Bowman infringed on Monsanto’s patents.  It rejected Bowman’s patent exhaustion argument, clarifying that in this case, because Bowman made copies of the patented technology (the seeds), the doctrine of patent exhaustion didn’t protect his actions; the doctrine of patent exhaustion only applies to the article that was lawfully purchased or obtained.

The Court raised the concern that “if the purchaser of [a sold] article could make and sell endless copies, the patent would effectively protect the invention for just a single sale,” thereby drastically reducing the value of patents and dis-incentivizing the research and development of new technologies.

The Court was not swayed by what it referred to as Bowman’s “blame the bean” defense – the argument that because beans self-replicate, a farmer does not control the reproduction of the patented article.   Ultimately, in addressing the self-replicating nature of seeds and the potential implications for other self-replicating technologies, the Court seemed to intentionally avoid making any sweeping decisions, stating, “We recognize that such inventions are becoming ever more prevalent, complex, and diverse.  In another case, the article’s self-replication might occur outside the purchaser’s control.  Or it might be a necessary but incidental step in using the item for another purpose…  We need not address here whether or how the doctrine of patent exhaustion would apply in such circumstances.”

Azita Mirzaian is an attorney at Pierce Law Group LLP, where she practices law with a focus on entertainment law, intellectual property law, and contractual disputes.  Her areas of interest include copyright matters, trademark matters, and right of publicity matters.  She also has a strong interest in food-related law.

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Supreme Court To Decide On The Patentability Of Human Genes

By Katie Podein & Tommy Wang

Should researchers and scientists be able to claim human DNA as their intellectual property? That is the question the U.S. Supreme Court must now decide after recently hearing oral arguments in the case of Association for Molecular Pathology v. Myriad Genetics. Robert Barnes of the Washington Post reported that the Justices expressed trepidation as they listened to the parties’ explanations of patent law and the complexities of biochemistry.  The overriding hesitation by the Supreme Court may be due to the fact that this decision not only has the potential to have profound impact on pharmaceuticals and genetically modified crops, but also has the potential shape the future of medical and genetic research.

In 2009, a coalition of researchers, genetic counselors, cancer survivors, breast cancer support groups, and scientific associations filed suit against Myriad Genetics, a Utah biotechnology company, challenging the company’s patent of genes known as BRCA1 and BRCA2.  Myriad discovered and isolated the two genes, which are highly associated with hereditary breast and ovarian cancer. Myriad patented its discovery and the company now has a twenty-year monopoly over the use, research, diagnostics, and treatment of the genes.

The general rule for registering for a patent with the USPTO is that the discovery or idea cannot be a product of nature or a law of nature. No matter how difficult or costly the discovery, a product of nature is ineligible for patent protection. However, to date, the USPTO has granted patents on at least 4,000 human genes to the companies, universities and researchers who have discovered and decoded them.

Despite the large number of patents for human genes, many in the medical profession do not favor patents on DNA.  The group of researchers and scientists who filed the Myriad Genetics lawsuit claim that Myriad’s patents claim rights to genes, which are a product of nature and therefore are not patentable.  Opponents also contend that patents, such as Myriad’s patents for BRCA1 and BRCA2, improperly put constraints on medical research and diagnostic testing.  They view patents for genes as an attempt to monopolize and block future exploration in the field of genetics and personalized medicine.

Myriad, on the other hand, supports the patents, arguing that the company has isolated these specific genes and thus they are a product of human ingenuity, not nature.  Myriad’s lawyer, Gregory Castanias, claims that without “the incentives offered by a strong and stable intellectual property system,” companies like Myriad may not receive the capital and support necessary to develop new treatments and introduce them to the medical field.

One possible resolution to the debate is to look to see how other countries handle the issue.  Most countries grant patents on genes but with specific exceptions to them, allowing researchers and diagnostic developers to use the genes freely.  Although this seems like a basic and logical solution, the process would be arduous for the Supreme Court, as they would have to enlist the help of Congress to change the current Patent Laws.

The Supreme Court’s decision will also determine the effect of patenting human DNA and generics has on scientific research and its patients.  Even the Justices verbalized the heavy burden of the decision during oral argument. In questioning whether the Court had to immediately decide on this issue, Justice Samuel A. Alito Jr. appropriately framed the question, “Why should we jump in … and decide the broadest question possible?”

 

Katie Podein is an associate attorney at Yang & Wang, P.C, practicing Intellectual Property and Business Law.  The firm’s practice includes patent; trademark; trade dress; trade secret; copyright; internet & new media; brand protection; and general corporate, organizational, and business law matters.

Tommy Wang is a registered patent attorney and partner at Yang & Wang, P.C.  He currently practices Intellectual Property Law, including Patent, Trademark, and Copyright,  and Business Law in Southern California and East Asia.  His patent practice specializes in securing patents in the medical device, biochemical sciences and life sciences field.

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Supreme Court May Put a Stop to the “Hokey-Pokey” Approach to IP Ownership

by Elizabeth Swanson

You put your right foot in, you put your right foot out,

You put your right foot in, and you shake it all about,

You do the Hokey-Pokey and you turn yourself around.

That’s what it’s all about![1]

On June 25, 2012 the U.S. Supreme Court granted YUMS’ Petition for a Writ of Certiorari in Already, LLC dba Yums v. Nike, Inc., No. 11-982.  This grant is important because its result may change federal court  jurisdiction in both patent and trademark infringement declaratory judgment cases.

The “Question Presented,” according to YUMS, is as follows:

“Whether a federal district court is divested of Article III jurisdiction over a party’s challenge to the validity of a federally registered trademark if the registrant promises not to assert its mark against the party’s then-existing commercial activities.”

YUMS explains its logic in its STATEMENT OF THE CASE:

1.     The issue cannot be resolved by litigation because it concerns the constitutional scope of Article III jurisdiction;

2.     Both trademark registrations and issued patents are evidence of the exclusive rights granted to the owners;

3.     Under 15 USC §1119, a person accused of infringement may ask a court to award judgment declaring that the mark is invalid;

4.     When validity is challenged under §1119, the owner may be willing to settle and to include a broad covenant not to sue, as in the YUMS case below;

5.     There may also be an argument that the court is divested of Article III jurisdiction because there are then no more claims of infringement, and this is often used as part of a litigation strategy;

6.     The Ninth Circuit has a pattern of holding that a covenant not to sue does not divest the district court of Ariticle III jurisdiction (Bancroft & Masters, Inc. v. Augusta National Inc., 223 F.3d 1082 (9th Cir. 2000);

7.     The Supreme Court has followed the Ninth Circuit’s reasoning with respect to patent cases including Lear, Inc. v. Adkins, 395 U.S. 653 (1969), MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007), Cardinal Chem. Co. v. Morton Int’l, Inc., 508 U.S. 83 (1993), and Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249 (1945);

8.     The Federal Circuit stated its rule regarding dismissal after settlement in patent cases in Super Sack Mfg. Corp. v. Chase Packaging Corp., 57 F.3d 1054, 1059-60 (Fed. Cir. 1995).  There, the Federal Circuit held  that the patent owner can divest a federal court of Article III jurisdiction over the defendant’s counterclaim for a declaratory judgment of patent invalidity by promising not to sue.  Judge Dyk has argued in a subsequent case against this “Super Sack” rule.  See Benitec Australia, Ltd. v. Nucleonics, Inc., 495 F.3d 1340, 1350-55 (Fed. Cir. 2007) (Dyk, J., dissenting).

9.     When the appeal was brought by YUMS, the Second Circuit stated that it was not persuaded that jurisdiction still exists.  This meant that a plaintiff could file an infringement case and not have to deal with the issue of validity and enforceability of its mark if it covenanted not to sue before a judgment was issued.  This interpretation is inconsistent with those followed by both the Federal Circuit and the Ninth Circuit, and can be viewed as a limitation of the power of federal courts in trademark cases.

If the Supreme Court agrees with YUMS and holds that once you are in court, you are there to the end, not withstanding a covenant not to sue, it may change litigation strategy for both patent and trademark owners;  filing a complaint could become less like dancing the Hokey-Pokey and more like an actual commitment – and attorneys would then need to make full disclosure of that changed risk to their clients.


[1] Written by Roland Lawrence LaPrise, (with Charles Macak and Tafit Baker) 1950 Copyright Acuff-Rose Music, Inc.

Elizabeth Swanson’s Century City practice includes all aspects of patent, trademark and copyright prosecution, trade secret management, and also includes infringement matters and litigation.  Ms. Swanson has been practicing only IP law for over 22 years.

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Supreme Court Provides Patent Litigators with a Retooled Argument in Prometheus

by Elizabeth Swanson

The United States Supreme Court recently provided litigators with a retooled weapon for invalidating patents in its Mayo Medical Labs et al v Prometheus et al (Supreme Court, 20 March 2012) (“Prometheus”) decision.  35 USC § 101 states: “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 therefore, subject to the conditions and requirements of this title.”

Typically, in litigation, patents are invalidated because the claimed matter is not patent-able based on §§ 102 and 103 (anticipation and obviousness, respectively) due to conflicting prior art, not because they are patent-ineligible based on §101.  In fact, §101 is relatively rarely used by courts to invalidate patents.

The patent at issue in Prometheus claimed a patent in a method of finding the optimal level of a drug whose levels varied widely from patient to patient.  The patent claimed the steps of (1) “administering a drug” to a patient and (2) “determining the [resulting metabolite] level”.

The first time that Prometheus was before the Federal Circuit, the Court applied the “machine or transformation test” to the matter and found the patent valid under that test.  The case then went up to the Supreme Court, which determined in June 2010 that the machine or transformation test” was not the sole test available, but that there were other available tests based on the plain language of §101. The case then was remanded to the Federal Circuit, which again found the patent at issue to be valid. When the case arrived before the Supreme Court for a second time in March 2012, the Court issued more language regarding invalidation under §101.

The Supreme Court disagreed with the Federal Circuit:  “The question before us is whether the [patent] claims do significantly more than simply describe these natural relations.  To put the matter more precisely, do the patent claims add enough to their statements of the correlations to allow the processes they describe to qualify as patent-eligible processes that apply natural laws?  We believe that the answer to this question is no.”

After examining each of the Prometheus claims individually, the  Supreme Court summarized: “The upshot is that the three steps simply tell doctors to gather data from which they may draw an inference in light of the correlations.  To put the matter more succinctly, the claims inform a relevant audience about certain laws of nature; any additional steps consist of well understood, routine, conventional activity already engaged in by the scientific community; and those steps, when viewed as a whole, add nothing significant beyond the sum of their parts taken separately.  For these reasons we believe that the steps are not sufficient to transform unpatentable natural correlations into patentable applications of those regularities.”

Since Prometheus, there have been several decisions issued in patent cases that draw on or reference Prometheus The district court in Washington, D.C. followed the Prometheus guidelines step for step and invalidated a method patent that used a computer to guide the selection of therapy for patients.  In contrast, the Northern District of California validated a patent, stating that it did not run afoul of §101 because it did “more than recite an abstract idea and say ‘apply it’” (language quoted directly from the Supreme Court’s second Prometheus opinion).

So, litigators take note:  Even if a method patent can be argued to satisfy the “machine or transformation test,” it still may be found invalid and ineligible for patent protection under §101 if the patent does little more than – in the Court’s opinion – restate a natural law.

Elizabeth Swanson’s Century City practice includes all aspects of patent, trademark and copyright prosecution, trade secret management, and also includes infringement matters and litigation.  Ms. Swanson has been practicing only IP law for over 22 years.


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The Epistemological Shift in Digital Rights: How Einstein Couldn’t Patent “E=MC2,” but Oracle May Soon Copyright a Whole Computer Language

By Jack Fritz

Don’t be fooled by James Cameron’s propaganda – when a ship is sinking, a desperate passenger on board will grasp at anything and stop at nothing for survival.  In the sea of copyright litigation, the Java computer language is this frazzled passenger, and Oracle is the sinking ship.

Oracle has acquired the patents for Java from Sun Microsystems and is now suing Google over them.  Java is a powerful, object-based computer language, so versatile that it can easily be implemented in html code (or its cousin java-script) to create websites and cell phone applications.  Google’s mobile operating system, Android, which is running most cell phones around the world, is allegedly founded on the Java API.

If Java is so popular then why is the Oracle ship sinking?  Initially, Oracle claimed that Google was infringing on seven patents, but before opening arguments could even begin, five of those patents were thrown out.  With regard to the two remaining, allegedly infringing patents, Oracle’s projected line of arguments relies primarily on copyright infringement of the two patent technologies.

Google’s argument is that the Java API is not copyrightable because it is a functional item.  Copyright law only protects tangible mediums of expression, not ideas, mechanisms, or operations.  For example, one notable case held that an accountant’s columnar notebook was not copyrightable despite its originality and its tangible fixation, because it was a functional item that facilitated tabulation.  Similarly, most courts have held that computer code is not copyrightable because of its functionality.  For this reason, the task of software protection has largely been relegated to the realm of patent law.

Oracle’s argument relies on outdated precedent and cases that were decided in an era before iPads and smartphones existed.  Oracle’s first salient argument is that the Java API is a literary work, and therefore a copy of any portion of it is an infringement.  Google did in fact literally cut, paste, and use portions of the Java API in its development of Android.  However, after these actions led to lawsuits, Google wrote brand new code as a work-around and took out all copied code from Android, thereby preventing Oracle from raising any claims in equity.  But clearly, the Java API is not merely text like the words in a novel – it is part of a system of functions that affects how a high-level computer language interacts with hardware on a touch screen interface.  Like E=MC2, Java is a series of equations, capable of receiving a variable or command and producing data.  And if Einstein couldn’t patent E=MC2, Oracle’s patent claims for the general Java API should also be impermissible.  Further, Oracle should be denied copyright protection for the Java API, as Java is a highly functional API and therefore categorically excluded from copyright protection.

Oracle’s second argument is that Google knew that the Java API was copyrighted since there are various emails indicating that Google co-founder Sergey Brin knew or should have known that a license was required in order to use Java.  However, copyright law does not have a state of mind requirement.  The work is a copy or it is not; good faith or bad faith is not a central issue, and prior belief that a work requires a license has no bearing on liability.

If Oracle wins its copyright arguments, there will be a boom and revival in software copyright litigation.  But it’s more likely that Oracle’s arguments will sink or they will settle.

 

To learn more:

http://gigaom.com/2012/04/15/game-time-oracle-google-set-to-face-off-over-android/

http://www.wired.com/wiredenterprise/2012/04/google-oracle/

http://www.wired.com/wiredenterprise/wp-content/uploads//2012/04/20120412-Googles-Copyright-Stance.pdf

http://www.wired.com/wiredenterprise/wp-content/uploads//2012/04/20120412-Oracles-Copyright-Stance.pdf

http://www.theverge.com/2012/4/13/2944440/google-oracle-lawsuit-programming-language-copyright

http://www.washingtonpost.com/business/google-denies-stealing-oracles-technology-to-develop-android/2012/04/17/gIQAruDXOT_story.html

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The New Death of Exclusive Patent Profits

by Jack Fritz

We have come full circle.  We used to analogize to the physical world to understand the digital, but a new ruling may require us to use the copyright wars of the digital realm to understand innovations in patent law in the physical realm.  In the early days of digital copyright law, courts frequently analogized to the physical world in order to better understand infringement.  Copying was thought of as larceny, video games were thought of as compilations of works of art, ping and echo port attacks were thought of as ringing a doorbell, and hot-spot sniffing was thought of as listening to a radio wave.  The legal world had no other tools to understand or language with which to address these issues.

Patents were easier to understand because they dealt with the physical world.  Although patent law had its own complexities that rivaled the merger doctrine or the second bite in copyright, patents were  more understandable.  But today, patent law is finally facing an issue that may be best understood by analogizing to the EFF, MPAA, and RIAA infringement battles that are being waged in the theater of copyright.  For the first time, a pharmaceutical patent is being used much like music is used on a late night talk show – that is, via a compulsory license.

This recent article in the Times of India describes a novel ruling in India, in which a court granted a compulsory license for a U.S. patent in order to provide wider access to a costly, life-saving drug.  The issue raised was whether the exclusive profits ensured by patent innovation outweigh the benefit of saving lives.

I believe that the royalty structure described in the article saves many lives while preserving sufficient profits for innovators, so it seems to be a reasonable (albeit imperfect) compromise in the complex and transnational world of IP.  Still, the economic argument – that some profits from a stream that would not have been tapped is better than no profits – may face ardent opposition from proponents of the capitalist sweat-equity argument that people should reap what they sow.  But often, when it comes to patent law, the absolutist arguments that are raised in copyright law seem a little out of place; while the unauthorized copying of copyrighted movies in China always seems wrong, the copying of life-saving, patented drugs that cure cancer in India seems like a far more complex case.

Original article: “Govt uses special powers to slash cancer drug price by 97%” by Rupali Mukherjee
Jack Fritz, Esq., is a member of the Executive Board of Directors for the IP, Internet, and New Media Section of the Beverly Hills Bar Association.

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