Supreme Court takes up patents

Tomorrow, the Supreme Court takes up the patent case I mentioned last November - a case that may change the US patent system. As the New York Times reports:

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.

The Washington Post put it this way:

At stake, attorneys on both sides of the case say, are 25 years of patent law and literally tens of thousands of patents on drugs, medical devices, computer software and other inventions. If the court reins in what can be patented, they say, it could be among the most important patent law decisions ever made.

It would be easy to dismiss this as media hype. But in this case, the newspapers are right. Scott Weingaertner of the law firm White & Case LLP explains what is at stake:

Although Lab Corp. is a case about a patent on a medical diagnostic method, it has been seen by some as an opportunity to roll back patent protection of "business methods," and to do so through the courts, rather than through legislation. Lab Corp. has become a test case because the patent it involves is directed not at a device, but essentially to the act of observing a correlation - between a protein found in the human blood stream and a certain vitamin deficiency. So, the patent strikes some critics as involving a claim to an abstract idea or scientific principle that should be off-limits under the US patent laws. The Supreme Court can now be expected to probe, and possibly reduce, the boundaries of patentability in the US.
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Whatever the Supreme Court decides - and, again, the outcome is far from clear - it will likely have a significant impact on technology and patent strategy for many industries and for US technology policy in general.
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Certain financial services providers and industry groups, among others, have argued that if the Supreme Court affirms the federal appellate court's decision, and the diagnostic patent remains valid, it will undermine their competitive environment. While Lab Corp. is not a "business method" patent case per se, a ruling on the diagnostic method it involves is believed by some to have the potential either to bless or eliminate patents on what some patent critics call "abstract ideas."

Many other companies and industries have weighed in on the issue. For example, the Computer & Communications Industry Association stated:

"If you can patent an abstract idea, the patent system will encourage free-riders and opportunists, not innovators," said CCIA President and CEO Ed Black. "Patents won't incentivize invention if developers can be sued just for thinking about a patented process."

"The patent system was designed to protect technology," said CCIA Fellow Brian Kahin, who led the drafting of the brief, "but the Federal Circuit has turned it into a land grab for anybody who can show a practical application for any abstract idea." Kahin added: "Remarkably, the Federal Circuit offers no good reason for this, but it claims to have just discovered that Congress intended to open patents up to all areas of human activity when it last codified patent laws in 1952. So it has authorized monopolies o­n useful knowledge and basic business models that preempt technological innovation."

As author Michael Crichton put it his op-ed in the New York Times "This Essay Breaks the Law":

In addition, there is the rather bizarre question of whether simply thinking about a patented fact infringes the patent. The idea smacks of thought control, to say nothing of unenforceability. It seems like something out of a novel by Philip K. Dick - or Kafka. But it highlights the uncomfortable truth that the Patent Office and the courts have in recent decades ruled themselves into a corner from which they must somehow extricate themselves.

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Companies have patented their method of hiring, and real estate agents have patented the way they sell houses. Lawyers now advise athletes to patent their sports moves, and screenwriters to patent their movie plots. (My screenplay for "Jurassic Park" was cited as a good candidate.)

Where does all this lead? It means that if a real estate agent lists a house for sale, he can be sued because an existing patent for selling houses includes item No. 7, "List the house." It means that Kobe Bryant may serve as an inspiration but not a model, because nobody can imitate him without fines. It means nobody can write a dinosaur story because my patent includes 257 items covering all aspects of behavior, like item No. 13, "Dinosaurs attack humans and other dinosaurs."

Such a situation is idiotic, of course. Yet elements of it already exist. And unless we begin to turn this around, there will be worse to come.

On the other side, the US Department of Justice argued that the Federal Circuit court was right in upholding the patent and the infringement case.

As I stated back in November, this would be a major case even if the Supreme Court ruled on the narrow issue of medical testing. It now looks like the case has turned into more than a major case. It looks like the Supreme Court is finally looking at the issue of how broad that government-granted monopoly we call a patent should be. One way or another, this will set the tone for all of our patent policy debates from now on.

FYI - while the courts will hear arguments tomorrow, a decision is not expected for some time.