Federal Circuit Denies En Banc Rehearing of Ariosa v. Sequenom, But Some Judges Urge Supreme Court to Fix Flawed Patent Eligibility Precedent

Today the Federal Circuit issued an order (available here) denying en banc rehearing of Ariosa v. Sequenom, an important patent eligibility decisions discussed in earlier posts.  I filed a brief on behalf of the Biotechnology Industry Organization (BIO) and Pharmaceutical Research and Manufacturers of America (PhRMA) arguing in favor of en banc rehearing, and discussing the negative implications of the decision for patenting in biotechnology, particularly as related to diagnostics and personalized medicine.  The decision to deny rehearing was accompanied by two concurring and one dissenting opinions filed by a total of four judges (Lourie and Moore, Dyk, and Newman), which provide some very interesting insight into their views on the current state of patent eligibility jurisprudence, particularly as it relates to the life sciences.

There was some substantial overlap in the opinions of all four judges.  For example, they all appeared to agree that the decision invalidating Sequenom’s method was both ill-advised as a matter of policy and not compelled by the language of the patent statute.  All of the judges seemed to recognize that Ariosa’s interpretation and application of the Mayo framework threatened the availability of effective patent protection for a broad swath of biotechnological innovation, particularly in the area of diagnostics.  Lourie and Moore, for example, found “some truth” in concerns raised by Sequenom and their amici “that a crisis of patent law and medical innovation may be upon us,” and that a broad range of claims appear to be in serious jeopardy, particularly diagnostic claims.

The judges recognized that the claims might raises concerns regarding overbreadth and/or indefiniteness, but suggested more measured approaches to address these concerns rather than the blunt instrument of the Supreme Court’s new patent eligibility jurisprudence.  Lourie and Moore suggested that “the finer filter of Section 112 [i.e., the enablement and definiteness requirement] might be better suited to treating these [concerns] as questions of patentability, rather than reviewing them under the less-defined eligibility rules.” In contrast, Judge Dyk opined that these other statutory requirements of patentability might not be entirely up to the task, but instead proposed a novel alternative approach to patent eligibility analysis that would have likely salvage some patent protection for a company like Sequenom, albeit at the cost of substantially narrower claim scope.  His suggested approach is discussed in more detail below.

The concurrence by Lourie and Moore found that while the blood fractionation and DNA analysis steps recited in the claims are individually well known, “the innovative aspect of the claims appears to be the improvement in the method of determining fetal genetic characteristics [] consisting of use of the non-cellular fraction of fetal DNA obtained from maternal blood sample.”  The result is a novel, innovative and practical method of diagnosis that constitute a substantial improvement over the highly intrusive means use prior to the invention.

Lourie and Moore went on to find that the claims would not preempt the asserted natural phenomenon, since there exist “other uses for cffDNA and other methods of prenatal diagnostic testing using cffDNA that do not involve the steps recited in the various claims,” and that this “fact should sufficiently address the concern of improperly tying up future use of natural phenomena and laws.”  In other words, these judges appear to support the notion that a claim only raises patent ineligibility concerns if it preempts all applications of a natural phenomenon.  This is in stark contrast to the approach of the panel that decided Ariosa - they treated the question of preemption as essentially irrelevant to the determination of patent eligibility.

Dyk’s concurring opinion largely tracked Lourie and Moore, agreeing that the language of Mayo, while unfortunate, compelled the panel decision in Ariosa.  But Dyk goes on to suggest that in assessing patent eligibility courts should distinguish between a patent eligible concept that is well known and long-standing at the time of invention as opposed to one that is newly discovered.  In his view:

Mayo did not fully take into account the fact that an inventive concept can come not just from creative, unconventional application of a natural law, but also from the creativity and novelty of the discovery of law itself.  This is especially true in the life sciences, or development of useful new diagnostic and therapeutic methods is driven by investigation of complex biological systems.  I worry that method claims that apply newly discovered natural laws and phenomena in some conventional ways are screened out by the Mayo test.  In this regard I think that Mayo may not be entirely consistent with the Supreme Court’s decision in Myriad.

I think Judge Dyk raises a very interesting and insightful point regarding Myriad.  In that case, the Supreme Court found that the genetic sequence of the BRCA genes was a natural phenomenon, but that the corresponding cDNA sequences were nonetheless patent eligible, in spite of the fact that nothing could be more routine and conventional than to synthesize cDNA based on the discovery of a naturally occurring gene.  Judge Dyk inferred that Myriad “recognize[d] that an inventive concept can sometimes come from discovery of an unknown natural phenomenon, not just from unconventional application of the phenomenon.”  He went on to propose a refinement of the Supreme Court’s test for patent eligibility, whereby “the novelty of the discovery [of a natural phenomenon] should be enough to supply the necessary inventive concept.”

Significantly, under Dyk’s proposed approach, an inventor would only be able to claim applications of a newly discovered natural phenomenon that had been “actually reduced practice, not merely ‘constructively” reduced to practice by filing of a patent application replete with prophetic examples.”  According to Dyk, the resulting claims would be narrow in scope and “would allow the inventor to enjoy an exclusive right to what he himself has invented and put into practice, but not to prevent new applications of the natural law by others.”  In other words, the narrow scope of the claims would obviate the preemption concerns underlying the patent eligibility doctrine.

Dyk’s concurrence concludes by suggesting that:

A future case is likely to present a patent claim where the inventive concept resides the newly discovered law of nature or natural phenomenon, but the claims narrowly drawn and actually reduced practice.  That case will, I hope, provide the Supreme Court with an opportunity to revisit the Mayo/Alice framework in this one limited aspect.

The third opinion was a dissent by Judge Newman.  Not surprisingly, she agreed with the other judges that the decision below was wrongly decided, but she did not “share their view that this incorrect decision is required by Supreme Court precedent.”  She found that the facts of Ariosa diverge significantly from those in Mayo and Myriad, and that the patent eligibility of Sequenom’s claims could be upheld without contravening Supreme Court precedent.