Archive for December, 2009

You Say Tomato . . . I Say Tah-mah-to . . . Hewlett-Packard Company v. Acceleron LLC

Monday, December 28th, 2009

Authored by Ronald J Schutz of Robins Kaplan Miller & Ciresi LLP

The Federal Circuit says: “declaratory judgment jurisdiction,” even if the patent holder’s notice letter waltzes around

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phrases like “infringement” or “assertion.” In Hewlett-Packard Company v. Acceleron LLC, the patent holder sent a letter that avoided using those phrases while still implying the possibility of litigation. The Federal Circuit said a patent holder cannot escape creating declaratory judgment jurisdiction simply by dodging certain words or phrases. Here, patent holder’s actions were “definite and concrete” enough to create a “substantial controversy.” Accordingly, the Federal Circuit reversed the district court’s determination that it lacked subject matter jurisdiction and remanded the claims for declarations of non-infringement and invalidity for further consideration — making it too late, presumably, for the patent holder to say “Let’s call the whole thing off.”

In Hewlett-Packard, a patent holding company owned the patent at issue. Within three months of acquiring the patent, the patent holder sent Hewlett-Packard a letter identifying certain HP products potentially impacted by its patent rights. The patent holder imposed a two-week deadline for execution of a letter agreeing, among other things, that Hewlett-Packard would not initiate litigation during negotiations. In response, Hewlett-Packard requested that the parties enter into a mutual no-litigation “standstill” agreement for 120 days. The patent holder refused and Hewlett-Packard filed its declaratory judgment action. Weighing the totality of the circumstances, the district court found that “the litigation was too speculative a prospect of support declaratory judgment jurisdiction.”

The Federal Circuit disagreed and specifically relied on MedImmune to reach its decision. While recognizing that the decision lowers the bar for what constitutes a justiciable controversy, the Federal Circuit said MedImmune nonetheless requires that a patent law declaratory judgment plaintiff demonstrate a dispute that is both “definite and concrete” and “real and substantial.” Not every fact pattern will rise to the necessary level of “a substantial controversy” and an objective review of the relevant facts is required. Necessary factors to be reviewed include consideration of whether the patent holder is a holding company or a competitor of the putative infringer, the patent holder’s history of enforcing the patent, the specific language used in any communications including their tone and implication and the status of relevant product lines and product plans. The Federal Circuit focused on the fact that the patent holder here was a patent holding company who, in response to the putative infringer’s answering letter, failed to agree to a confidentiality agreement or a mutual standstill of litigation that would have allowed the parties to engage in negotiations without litigation.

Either (or eye-ther), after Hewlett-Packard, regardless of what patent holders say, they most likely won’t be able to dance their way out of declaratory judgment jurisdiction if the reviewing court discerns an implied threat of litigation. Neither (nye-ther) should patent holders set overly burdensome conditions or precursors to further negotiations lest those demands become the evidence of a real dispute or controversy. Patent holders will also have to evaluate the use of “file, but not serve” rules in order to protect their chosen forum, but still engage in negotiation prior to full scale litigation.

Clearly, patent law declaratory judgment jurisprudence continues to evolve after MedImmune (leaving litigants on both side ample opportunities to argue that their unique facts should control). Still, no matter how you say it, after Hewlett-Packard, effectively initiating patent licensing negotiations while avoiding creating declaratory judgment jurisdiction remains patent law’s current hot potahto.

TOP BIOTECH STORIES OF 2009 – DON'T FORGET STEM CELL RESEARCH

Monday, December 28th, 2009

The lists of the top pharma/biotech stories for 2009 that I have been seeing online focus mostly on the rise of biosimilars, the spate of mergers and the plurality of Hatch-Waxman litigations that have grabbed the headlines almost daily, along with the policies of the new PTO Director and attacks on gene- and business-method patenting.

Let’s not forget one major policy shift that President Obama initiated early in the year that may do more for the health of our citizens than the gut-shot health care reform bill stumbling toward further compromise. On March 9, 2009, President Obama signed Executive Order 13505 that lifted a more than eight-year ban on Federal Funding for research on embryonic stem cells.

Prior to the order, U.S. researchers could conduct research on ESCs with private funds, but this research had to be strictly segregated from any resources made available by the feds. In other words, an instrument bought with private funds could not be set on a lab bench built with federal funds. This problem is not entirely remedied by the Executive Order since Congress continues to attach an amendment to general funding bills that prohibits the use of federal funds to destroy or harm human embryos. In other words, researchers can now use ESCs, but they can’t make them from scientific scratch.

Still, this is an important step forward to enhance the ability of U.S. researchers to contribute and complete in this new and increasingly promising area. In August, the NIH issued guidelines which it will use in deciding if grant applications for stem cell research are fundable, and in approving ESC lines not previously approved for use in research. The stem cells must have been derived from embryos in excess of clinical need for in vitro fertilization, they must be voluntarily donated by the “parents,” and not bought or sold. Also, the human embryos cannot be the result of cloning experiments. See, http://stemcells.nih.gov.

In early December, NIH approved, inter alia, the use of 11 cells produced at Harvard using private funding. This is significant, since there are an estimated 700 ESC lines in the worldwide research community, and research on most of them may well be fundable now. Reports of phase I/II clinical trials using ESCs to treat a wide range of mostly hopeless conditions are frequent already. A very recent news story reported that a Scottish researcher plans to use ESCs in an attempt to treat stroke victims. Let’s hope that executive order 13505 and the NIH regulations open the floodgates for both new business opportunities and, more importantly, new hope for the new year.

Recent EPC rule changes restrict filing of Divisional Applications

Tuesday, December 15th, 2009

Attached is an article by Malcolm Lawrence of HLBBshaw, Epping, UK

1. Background

On 25th March 2009, the Administrative Council of the European Patent Organisation issued decision CA/D 2/09 which introduces stricter requirements regarding the filing of divisional applications. These stricter requirements have apparently been introduced because the EPO considers that some Applicants have abused the divisional system.

To read the entire article see attached Recent EPC Rule Changes.pdf

PTO Launches Pilot Program to Speed Patenting Green Technologies

Monday, December 14th, 2009

On December 8th, the Patent Office implemented a pilot program in which an applicant may have an unexamined application filed before December 8, 2009 made special upon a showing that the putative patent would “materially enhance the quality of the environment by contributing to the restoration or maintenance of the basic life sustaining natural elements.” 74 Fed. Reg. 64666 (Dec. 8, 2009) (a copy is attached at the end of this posting). The petition to make special must state the basis for the special status, but there are a lot of them. The notice lists them by classification, and they fall broadly into alternative energy production, energy conservation, environmentally friendly farming (including all of “plants and plant breeding ” – 800 (!)) and environmental purification, protection or remediation. The subclasses cover everything from swimming pool heating to wind-powered ships. Of course, biotech faves like “biofuel,” “toxic material clean-up,” and “recycling” are included, as well as “using microbes and enzymes [to destroy toxic materials], and “genetically engineered organism” [to produce fuel, I assume]. Somewhat more exotic ones include “emission trading” (a business method?), “drag reduction,” and nuclear power. One area I have worked in but couldn’t quite find was “herbicide alternative” or some such, although “fertilizer alternative” is present. Maybe this would fall within “yield enhancement” but so would quite controversial inventions like Bt corn or glyphosate-resistant soybeans.

Of course there are lots of strings attached. The program has a limit of 3000 petitions, which must be filed before December 8, 2010. The claims must be directed to a single invention and there can only be three independent and twenty total claims (shades of the recently departed rule package?). Both this Green Pilot program and the Abandon to Advance Pilot Program at least exhibit a startling level of creativity for an Office not known for that trait, but I worry that the resources may not be there to expeditiously process all these petitions. If you try it (and I intend to), please let me know if you like it!

74 FR 64666.pdf