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EXTRATERRITORIALITY OF PROCESS PATENTS MEET OUR NEW PATENT CONGRESS: THE FEDERAL CIRCUIT World-Wide?

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Presentation on theme: "EXTRATERRITORIALITY OF PROCESS PATENTS MEET OUR NEW PATENT CONGRESS: THE FEDERAL CIRCUIT World-Wide?"— Presentation transcript:

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2 EXTRATERRITORIALITY OF PROCESS PATENTS MEET OUR NEW PATENT CONGRESS: THE FEDERAL CIRCUIT World-Wide?

3 SHORT HISTORY 1.In Deep South Packaging Co. v. Laitram, 406 U.S.518 (1972), the Supreme Court felt that none of the patent laws covered components for a shrimp deveining machine, whose components were manufactured in the United States and assembled abroad. 2. This lead to the Congressional enactment of 271(f) in 1984 and (g) in 1987, laws created without which “the public would not benefit from the release of creative genius” citing H.R. 6286, Patent Law Amendments Act of 1984, 130 Cong. Rec. 28069 (Oct. (1984). When signed by President Reagan he stated the stated 271(f) was intended to “[close] a loophole in existing law which permitted copiers to export jobs and avoid liability by arranging for final assembly of patented machines to occur off-shore.” www.presidency.ucsb.edu/ws/print.php?pid=39406 (Nov. 9. 1984). 3.271(f) was enacted specifically in response to the Deep South decision.

4 271(f)(1) (1)Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer. That is, staple articles of commerce.

5 271(f)(2) (2)Whoever without authority supplies or causes to be supplied in or from the United States any component of a patented invention that is especially made or especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use, where such component is uncombined in whole or in part, knowing that such component is so made or adapted and intending that such component will be combined outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.

6 Patented method of producing asphalt. Foreign sale for an apparatus capable of carrying out the method. Finding 271(f) not implicated. STANDARDS HAVENS PRODUCTS INC. v. GENCOR INDUSTRIES, INC., 953 F.2d 1360 (Fed. Cir. 1991)

7 WAYMARK CORP. v. PORTA SYS. CORP., 245 F.3d 1364 (Fed. Cir. 2001) Holdings: 1.There need not be a direct infringement for liability under 271(f)(2) and 2.Components need not be assembled abroad so long as the components are intended to be assembled abroad. The Court’s reasoning: Requiring assembly abroad would “pose the appearance of ‘giving extraterritorial effect to United States patent protection.’ ”

8 PELLIGRINI v. ANALOG DEVICES, 375 F.3d 1113 (Fed. Cir. 2004) Holding: 271(f) does not apply when the United States company supplies instructions to manufacture a patented invention abroad. Further, for 271(f) to apply, components of a patented invention must be physically present in the United States.

9 EOLAS TECH. INC. v. MICROSOFT CORP., 399 F.3d 1325 (Fed. Cir. 2005) Holding: 271(f) applies to the employment of a web browser and a fully interactive environment in Internet Explorer where Microsoft sends a golden master disc exported to be further distributed as source code on computer in foreign countries. Finding of Court: Software qualifies as “components of a patented invention.” The Court’s reasoning: “Interchangeable nature of software and hardware.”

10 AT&T CORP. v. MICROSOFT CORP., 414 F.3d 1366 (Fed. Cir. 2005) The patented technology was speech codes (method and article) alleged to infringe AT&T’s patents. Presently before the Supreme Court for decision, oral argument in February 2006. Holding: 271(f) applies; software can be a component. “Supplying” means “generating a copy” and Microsoft found to send a golden master disc outside the United States which was manufactured abroad by encoding a storage medium with the Windows software. Pellegrini distinguished as Microsoft was distributing “an actual component, i.e., the Windows Operating System.”

11 Federal Circuit AT&T Decision Reversed by Supreme Court April 30, 2007 Supreme Court ruling: General rule – Section 271(f) shall be read narrowly to only encompass situations contemplated when enacted. There is a presumption against extraterritorial effect. Foreign conduct is generally the domain of foreign law. Foreign law embodies different policy judgments on the rights of inventors and the public. Foreign law alone governs the manufacture and sale of components of patented inventions in foreign countries. Any arguable gaps or loopholes in legislation must be determined by Congress and not judicial forecasting. There is no license to attribute to Congress an unstated intention. BREAKING NEWS BREAKING NEWS BREAKING NEWS

12 NTP, Inc. v. RESEARCH IN MOTION, 418 F.3d 1282 (Fed. Cir. 2005) Holding: As to the method claim, 271(f) did not apply to the shipment of Blackberry devices, the court pointing out the difficulty with conceiving “how one might supply or cause to be supplied all or a substantial portion of the steps of a patented method.” No mention ever made of whether a method could never be invoked under 271(f). Incoming Call: OLD BATTLE AXE Incoming Call: OLD BATTLE AXE

13 UNION CARBIDE CHEMS. & PLASTICS TECH. CORP. v. SHELL OIL CO., 425 F.3d 1366 (Fed. Cir. 2005) Petition for certification filed, case settled before petition acted upon. Patent for process for using a silver- containing catalyst. Claim 4 (the only claim at issue) – the process of Claim 1 where the alkaline metal is lithium.

14 UNION CARBIDE CHEMS. & PLASTICS TECH. CORP. v. SHELL OIL CO., 425 F.3d 1366 (Fed. Cir. 2005) (cont’d) Claim 1 – In the continuous process for the production of ethylene oxide by the vapor phase oxidation of ethylene with molecular oxygen provided as an oxygen-containing gas at a temperature of from about 200 C. to 300 C. in the presence of at least about one mole percent of carbon dioxide and an organic chloride in the gaseous feed stream and in the presence of a supported silver-containing catalyst in a fixed bed, tubular reactor used in commercial operations to form ethylene oxide, wherein said supported, silver-containing catalyst contains 2 to 20 weight percent silver deposited on a support which is in a form and size for use in the reactor, wherein (i) the specific reaction conditions of the ethylene oxide process; (ii) the specific catalyst support characteristics and (iii) the specific silver deposition method comprise an ethylene oxide production system, the improvement in which the catalyst comprises silver deposited on an alpha-alumina macroporous support in the first amount having a surface area less than 10 m 2/g and contains a combination of (a) cesium in a second amount and (b) at least one other alkali metal selected from the group consisting of lithium, sodium, potassium and rubidium in a third amount, which combination comprises (a) and (b) in amounts in relation to the amount of silver in the catalyst sufficient to provide an efficiency of ethylene oxide manufacture that is greater than the efficiencies obtainable in the same ethylene oxide production system, including the same conversions, than (i) a second catalyst containing silver in the first amount and cesium in the second amount, and (ii) a third catalyst containing silver in the first amount and the alkali metal in the third amount, wherein the combination of silver, cesium and alkali metal in said catalyst is characterizable by an efficiency equation: [complicated efficiency equation omitted to save space]

15 LIMITATIONS OF CLAIM 4 AS CONSTRUED BY THE DISTRICT COURT (AND AFFIRMED) (1) an EO process operated at specific reaction conditions ; (2) the catalyst used in the EO process comprises silver in a first amount, cesium in a second amount, and lithium in a third amount; (3) the efficiency obtainable from the EO process using the catalyst is greater than the efficiency of a process using (a) a second catalyst containing silver in the first amount and cesium in the second amount (but no lithium) and (b) a third catalyst containing silver in the first amount and lithium in the third amount (but no cesium), when operated in the same EO production system (the “comparison test”); and (4) the combination of silver, cesium and lithium is characterizable by the efficiency equation set forth in claim 1 (the “characterizable test”). Holding: 271(f)(2) violated, citing AT&T v. Microsoft and Eolas v. Microsoft, where the Court compared favorably the exportation of a computer disc with program code to a catalyst in the performance of a patented process or method. Although 271(f)(2) is first cited, the only rationale that follows talks to 271(f) generally.

16 UNION CARBIDE CHEMS. & PLASTICS TECH. CORP. v. SHELL OIL CO., 425 F.3d 1366 (Fed. Cir. 2005) NTP distinguished Court rules Shell supplied catalyst from the United States directly to foreign customers. NTP was the domestic sale of a component being used in part outside of the United States. Holding: Eolas more factually analogous to Shell and earlier in time than NTP. Further holding: 271(f) governs method/process inventions, exportation of catalyst may result in liability in 271(f).

17 PROBLEM: UNLIKE EOLAS AND AT&T, THE CATALYST IN SHELL WAS NOT A PATENTABLE COMPONENT BUT A VERY OLD SILVER CATALYST NOW USED IN A NEW AND IMPROVED PROCESS THAT WAS PATENTABLE It does not appear that the silver catalyst was “especially made or especially adapted for use in the invention.” It does appear as if it is a staple article or commodity of commerce suitable for substantial noninfringing use, such as use of Shell’s process prior to its infringing use.

18 UNION CARBIDE CHEMS. & PLASTICS TECH. CORP. v. SHELL OIL CO. FIRST DECISION – 308 F.3d 1167 (Fed. Cir. 2002) Findings of Court: “It is well known in the field that one can increase reaction efficiency by combining the ethylene and oxygen in the presence of silver catalyst.” 1 243 Union Carbide patent referred to as the synergy patent: a synergistic mixture of silver, cesium and lithium and is “characterized by an efficiency equation.”

19 UNIVERSITY OF ROCHESTER v. G.D. SEARLE & CO., INC. 375 F.2d 1303 (Fed. Cir. 2004) 1.A method for selectively inhibiting PGHS-2 activity in a human host, comprising administering a non-steroidal compound that selectively inhibits activity of the PGHS-2 gene product to a human host in need of such treatment.

20 UNIVERSITY OF ROCHESTER v. G.D. SEARLE & CO., INC. 375 F.2d 1303 (Fed. Cir. 2004) (Cont’d) 6.A method for selectively inhibiting PGHS-2 activity in a human host, comprising administering a non-steroidal compound that selectively inhibits activity of the PGHS-2 gene product in a human host in need of such treatment, wherein the ability of the non-steroidal compound to selectively inhibit the activity of the PGHS-2 gene product is determined by: a) contacting a genetically engineered cell that expresses human PGHS-2, and not human PGHS-1, with the compound for 30 minutes, and exposing the cell to a pre-determined-amount of arachidonic acid; b) contacting a genetically engineered cell that expresses human PGHS-1, and not human PGHS-2, with the compound for 30 minutes, and exposing the cell to a pre-determined amount of arachidonic acid; c) measuring the conversion of arachidonic acid to its prostaglandin metabolite; and d) comparing the amount of the converted arachidonic acid converted by each cell exposed to the compound to the amount of the arachidonic acid converted by control cells that were not exposed to the compound, so that the compounds that inhibit PGHS-2 and not PGHS-1 activity are identified.

21 BIOINFORMATICS If this road to infringement is not closed, there are certain likely/typical results to follow in all fields of technology. The following are some possible examples relating to the approximately 2,000+ bioinformatics patents:

22 U.S. PATENT NO. 7,191,173 MARCH 13, 2007 Method of determining database search path Inventors:Mizunuma; Tadashi (Tokyo, JP), Tago; Shigeru (Tokyo, JP), Yoshii; Junji (Tokyo, JP) Assignee: Hitachi Software Engineering Co., Ltd. (Kanagawa, JP)

23 U.S. PATENT NO. 7,191,173 MARCH 13, 2007 (Cont’d) 1.A method of determining a database search path in a database system, which includes databases each containing records with search keys of related records stored in other databases, for extracting records containing a search key that is entered into the system, in which system a starting record extraction is carried out using a starting search key that is entered into a starting database thereby extracting records from the starting database, and an intervening search key that is contained in the extracted records from the starting database and that is different from the starting search key is entered into the intervening database different from the starting database so as to carry out an intervening record extraction in the intervening database in a chain-reactive manner form the starting database via a plurality of intervening databases to the terminal database using search keys and records to link the starting, intervening, and terminal databases, the extracted records as search results, the method comprising: a first step of classifying the plurality of databases into groups based on the characteristics of data included in individual databases; a second step of creating a correlation network wherein the groups are related with each other based on relevance between the groups; a third step of obtaining inter- group path candidates in the correlation network; and a fourth step of designating a starting database and a terminal database from the plurality of databases and obtaining an inter-database path candidate that exists on one of the inter-group path candidates that exists between the starting and terminal databases.

24 U.S. PATENT NO. 7,191,068 MARCH 13, 2007 Proteomic analysis of biological fluids. Inventors:Rosenfeld; Ron (Los Altos, CA), Nagalla; Sri (Hillsboro, OR), Gravett; Mike (Portland, OR) Assignee: Proteogenix, Inc. (Portland, OR)

25 U.S. PATENT NO. 7,191,068 MARCH 13, 2007 (Cont’d) 30.A method for the diagnosis of intra-amniotic infection, comprising (a) comparing the proteomic profile of a test sample of a biological fluid selected from the group consisting of amniotic fluid, serum and plasma obtained from a pregnant female mammal with the proteomic profile of a normal sample, or a reference proteomic profile comprising at least one unique expression signature characteristic of said condition, wherein said proteomic profiles provide information of the mass of the proteins present in said samples, or the proteolytic fragments thereof; (b) diagnosing said mammal with intra-aniniotic infection if the proteomic profile of the test sample shows a unique expression signature in the 3-5 and/or 10-12 KDa molecular weight range; and (c) wherein said test sample proteomic profile and said normal sample proteomic profile or reference proteomic profile comprise information of the expression of azurocidin, fragments or naturally occurring variants therof that are functional in the diagnosis of intra-amniotic infection. 01001110100010101000

26 U.S. PATENT NO. 7,189,839 MARCH 13, 2007 Isolated polyncleotides encoding a human cytokine receptor human cytokine receptor Inventors:Presnell: Scott R. (Tacoma, WA), Xu; Wenfeng (Mukilteo, WA), Kindsvogel; Wayne (Seattle, WA), Chen; Zhi (Seattle, WA) Assignee: ZymoGenetics, Inc. (Seattle, WA) 15.A method of producing a soluble cytokine receptor polypeptide, the method comprising culturing recombinant host cells that comprise the expression vector of claim 13, and that produce the soluble cytokine receptor polypeptide, and isolating the soluble cytokine receptor polypeptide from the cultured recombinant host cells.

27 U.S. PATENT NO. 7,189,507 MARCH 13, 2007 Methods of diagnosis of ovarian cancer, compositions and methods of screening for modulators of ovarian cancer. Inventors: Mack; David H. (Menlo Park, CA), Gish; Kurt C. (San Francisco, CA) Assignee: PDL BioPharma, Inc. (Fremont, CA) 1.A method of detecting ovarian cancer in a patient, the method comprising: (i) detecting a nucleic acid in a first sample from the patient, wherein the nucleic acid is at least 95% identical to a sequence selected from the group consisting of SEQ ID NOs: 13, 15, 17, 19 and 21, and wherein the nucleic acid encodes a G protein-coupled receptor 64; and (ii) comparing the expression level of the nucleic acid in the first sample to the expression level in a normal sample, wherein an increase in the level of the nucleic acid relative to a normal sample is indicative of ovarian cancer.

28 U.S. PATENT NO. 7,188,032 MARCH 6, 2007 Incremental determination of Teiresias patterns. Inventors: Srinivasa; Deepak M. (Bangalore, IN) Assignee: International Business Machines Corporation (Armonk, NY) 1.A method for determining Teiresias patterns, said method comprising the steps of: providing a set of S’.sub.0 of n sequences denoted as S.sub.1, S.sub.2,... S.sub.n, positive integers L, W, and K, and teiresias patterns P’.sub.0 consisting of all patterns for the set S’.sub.0, each sequence of the n sequences consisting of characters from an alphabet, wherein a sequence index I equals 1; supplying a sequence S.sub.n+1 to form a set S’.sub.i consisting of S’.sub.i-1.orgate.S.sub.n+1, wherein S.sub.n+1 consists of characters from the alphabet; and determining Teiresias patterns P’.sub.i consisting of all patterns for the set S’.sub.i by performing an algorithm that utilizes S’.sub.i-1, L, W, K, P’.sub.i-1, and S.sub,n+i as input.

29 U.S. PATENT NO. 7,179,787 FEBRUARY 20, 2007 Methods of using human Zven proteins Inventors: Sheppard: Paul O. (Granite Falls, WA), Bishop; Paul D. (Fall City, WA) Assignee: ZymoGenetics, Inc. (Seattle, WA)

30 U.S. PATENT NO. 7,179,787 FEBRUARY 20, 2007 (Cont’d) 1.A method of stimulating gastrointestinal contractility in a mammal in need thereof comprising administering to the mammal a polypeptide, wherein the polypeptide comprises the amino acid sequence of amino acid residues 28 to 108 of SEQ ID NO:2 and whereby gastrointestinal contractility is stimulated. 4.A method of stimulating gastric emptying in a mammal in need thereof comprising administering to the mammal a polypeptide, wherein the polypeptide comprises the amino acid sequence of amino acid residues 28 to 108 of SEQ ID NO:2 and whereby gastric emptying is stimulated. 5.The method according to claim 4, wherein the polypeptide is administered in one or more administration. 6.The method according to claim 4, wherein the polypeptide is administered continually for a period of time. PATENT NO. 7,179,787

31 ARGUMENTS BEFORE SUPREME COURT IN AT&T CASE BY FICPI 1.TERRITORIALITY IS DEFINED BY TREATIES; 2.ULTRA VIRES ACTS BY FEDERAL CIRCUIT CANNOT BE CONDONED; 3.INTERNATIONAL LAW PREVENTS AN INFRINGEMENT FINDING; 4.THE PATENTABILITY OF SOFTWARE IS NOT RECOGNIZED OUTSIDE THE UNITED STATES; 5.FEDERAL CIRCUIT DECISIONS UNDERCUT THE ABILITY OF OTHER NATIONS TO ENFORCE PATENT SYSTEMS OF THEIR OWN DESIGN.

32 THE CONSTITUTION OF THE UNITED STATES IS “TO FORM A MORE PERFECT UNION”, TO “ENSURE DOMESTIC TRANQUILITY” IN THE UNITED STATES AND “PROMOTE GENERAL WELFARE” IN THE UNITED STATES. IT NEVER CONSIDERED THE GOVERNING OF ACTIVITIES EXCLUSIVELY WITHIN FOREIGN COUNTRIES. ARTICLE 1, INCLUDING SECTION 8 (PATENTS AND COPYRIGHTS) LISTING THE SPECIFIC POWERS OF CONGRESS ARE LIMITED TO THE “UNITED STATES” OR THE “UNION”.

33 PARIS CONVENTION, ARTICLE 4(1) : “Patents applied for in the various countries of the Union by nationals of countries of the Union shall be independent of patents obtained for the same invention in other countries, whether members of the Union or not.” The “independent” concept is an indication that a United States patent is independent of a patent in any other country and cannot govern acts in other countries. The concept of “territoriality” has been central to international law for over a century. Paris Convention was a treaty made under Article 2, Sec. 2, Para. 2 of the Constitution with the advice and consent of 2/3 of the Senate. 0101001001100

34 Computer programs were specifically not allowed to be patented under European policy. UK High Court of Justice, Chancery Division, Patents Court, 21 July 2005. “International conventions are to be given purposive interpretation”

35 Cont’d. The reasons given were that such patents were: 1.Not really needed; 2.Were too cumbersome (it was felt that searching the prior art would be a big problem and would do more harm than good); 3.The software industry in America developed at an astonishing pace when no patent protection was available; 4.Copyright law protects computer programs against copying; 5.A patent on a computer program would stop others from using it even though there have been no copying at all; 6.There would have to be infringement searches; 7.You cannot have a sensible patent system unless there is a proper body of prior art that can be searched; 8.Not only are most computer programs supplied in binary form, unintelligible to humans, but most of the time, it is actually illegal to convert as a human readable form. A patent system where it is illegal to search most prior art is something of an absurdity (quoting the High Court).

36 INTERNATIONAL LAW The basic structure of an international patent system is territorial. This is recognized by TRIPS dated April 15, 1994. A patent shall confer on its owner the following exclusive rights: Where the subject matter of a patent is a product, to prevent third parties not having the owner’s consent, from the acts of making, using, offering for sale, selling, or importing that product.

37 CONCLUSION The present state of the law of the Federal Circuit is not in accord with Congressional intent and the laws of most foreign countries. Applying extraterritoriality reach offends our treaties and our relationships in foreign commerce. Thank you.


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