Split decision from US Federal Circuit on patentable subject matter

For over fifteen years, from In re Alappat, 33 F.3d 1526 (Fed. Cir. 1994) to In re Bilski, 545 F.3d 943 (Fed. Cir. 2008), it seemed that the requirement of patentable subject matter had no bite in the US.  It was at best vestigial.  After Bilski, however, it’s back.  The latest manifestation of it is the split decision in Association for Molecular Pathology v. PTO, No. 10-1406 (Fed. Cir. July 29, 2011).

There were a number of patent claims at issue in Association for Molecular Pathology.  The district court had found them all invalid for lack of patentable subject matter.

One group of claims addressed isolated DNA molecules having the sequence of part or all of the BRCA gene (a gene associated with breast cancer).  With respect to these claims, the three-judge panel split three ways.  Judge Bryson dissented arguing that these claims lack patentable subject matter, while the other two judges (Lourie and Moore) gave differing rationales for finding that they have patentable subject matter.

Judge Lourie based his opinion on Diamond v. Chakrabarty, 447 U.S. 303 (1980).  He read that case to set out the following legal rule:  claims to “compositions that, even if combined or altered in a manner not found in nature, have similar characteristics as in nature” lack patentable subject matter,  whereas “compositions that human intervention has given ‘markedly different,’ or ‘distinctive,’ characteristics” have patentable subject matter.  The inquiry as to whether the characteristics are “markedly different” from those of the natural product is presumably distinct from obviousness, although related.

Judge Lourie’s reasoning for finding markedly different characteristics in the claims at issue was as follows:  “In this case, the claimed isolated DNA molecules do not exist as in nature within a physical mixture to be purified. They have to be chemically cleaved from their chemical combination with other genetic materials. In other words, in nature, isolated DNAs are covalently bonded to such other materials. Thus, when cleaved, an isolated DNA molecule is not  a purified form of a natural material, but a distinct chemical entity. In fact, some forms of isolated DNA require no purification at all, because DNAs can be chemically synthesized directly as isolated molecules.”

Judge Moore also based her opinion on Diamond v. Chakrabarty.  She saw in that decision a further requirement of “potential for significant utility,” not recognized by Judge Lourie, for claims to purified natural products to have patentable subject matter:  “I analyze the isolated DNA claims below, to determine whether they have markedly different characteristics with the potential for significant utility.”

As regards utility, Judge Moore reasoned that “The shorter isolated DNA sequences have a variety of applications and uses in isolation that are new and distinct as compared to the sequence as it occurs in nature. For example, these sequences can be used as primers in a diagnostic screening process to detect gene mutations.”  In contrast, with respect to longer isolated DNA sequences that encompass most of the gene, she takes a much different approach.  “If I were deciding this case on a blank canvas, I might conclude that an isolated DNA sequence that includes most or all of a gene is not patentable subject matter.”  She finds, however, that those claims also have patentable subject matter because the PTO has been issuing patents on them, investments have been made in reliance on those patents, and “[t]he settled expectations of the biotechnology industry—not to mention the thousands of issued patents—cannot be taken lightly and deserve deference.”

Decisions with three-way splits are uncommon at the court of appeals level.  It is possible that subsequent panels will regard Judge Moore’s narrower rationale as being the ratio decidendi of the case.  Alternatively, given the recent grant of cert in Prometheus Laboratories, Inc. v. Mayo Collaborative Services, 628 F.3d 1347 (Fed. Cir. 2010), subsequent panels may see whatever standards the Supreme Court eventually hands down in deciding that case as superseding the statements of both of the judges in the majority here.

A second group of claims included a “method claim to screening potential cancer therapeutics via changes in cell growth rates.”  The panel unanimously found this claim to have patentable subject matter.

A third group of claims was “directed to ‘comparing’ or ‘analyzing’ DNA sequences.”  Those claims were found to lack patentable subject matter.  The panel opinion gave a somewhat varying set of rationales for this conclusion.

At the outset, the panel said that “such claims [a] include no transformative steps and [b] cover only patent-ineligible abstract, mental steps.”  Are both of these things required, or is one enough to find a claim lacking in patentable subject matter?   Further on in the opinion, Judge Lourie seems to say that “mental processes” are patent-ineligible, but cites only a dictum from the old case Gottschalk v. Benson, 409 U.S. 63 (1972), for that proposition.  He then gives as the reason for finding the claims to lack patentable subject matter that they “are directed to patent-ineligible, abstract mental processes, and fail the machine-or-transformation test.”  Would either of these reasons have sufficed by itself?  He then says that the claims at issue lack patentable subject matter “because they claim only abstract mental processes.”  Would “non-abstract mental processes” be patent eligible?

A sample “analyzing” claim held invalid under § 101 was:  “1. A method for detecting a germline alteration in a BRCA1 gene, said alteration selected from the group consisting of the alterations set forth in Tables 12A, 14, 18 or 19 in a human[,] which comprises analyzing a sequence of a BRCA1 gene or BRCA1 RNA from a human sample or analyzing a sequence of BRCA1 cDNA made from mRNA from said human sample with the proviso that said germline alteration is not a deletion of 4 nucleotides corresponding to base numbers 4184-4187 of SEQ ID NO:1.”  This is sort of like saying “a method of detecting the textual variants set out in Table A in a printed text of the Divina Commedia by analyzing the printed text.”  It is a “mental process” in the sense that it can be done mentally; it can also be done (and more usually would be done, I assume) with a computer.  I am not clear why it is an abstract mental process, but the panel found it to be so.  The panel’s reasoning to establish that “abstract mental processes” are being claimed refers repeatedly to the lack of “transformative” steps.

The panel distinguishes the claims held patentable in Prometheus because the “analyze” claims do not expressly recite “the step of ‘determining’ the sequence of BRCA genes by, e.g., isolating the genes from a blood sample and sequencing them, or any other necessarily transformative step.”  Would the panel have found the “analyze” claims to have patentable subject matter if this small addition had been made to them?

Flavio M. Rose, Irell & Manella LLP