Intellectual Property: An Industrial Perspective

1. Intellectual Property: An Industrial Perspective Massachusetts Institute of Technology January 18, 2007 Neil Feltham Esq Senior Patent Counsel E. I. DuPont

2. Object • Provide Information On Patents That Will Be Useful In Interaction With Industrial Partners

3. Overview • Patents and Industry – Historical Perspective • Importance of IP to DuPont • Patent Primer • Basics • Patent Pitfalls – How can I lose rights to my invention? • Intellectual Property and the DMA

4. Patent Law – A Brief History • Medieval Times (1100 – 1550) • Monopolies granted by the state • Form of taxation • Mining and textile • Solely for the benefit of the Crown • English Civil War (1624) • Parliament limits power of Crown to grant monopolies • Permits only grants to inventions for 14 years – 2 apprenticeship periods • Inventions needed to be beneficial to society.

5. Brief History • French Law (1791) • Rights of the inventor and personal property ownership emphasized. • “All discoveries are the property of the author..” • Vestiges of this are seen in many EU countries today • Mandatory inventor remuneration • Concept applies in US with respect to Copyright. • Modern Approach • Contract between the inventor and society at large. In exchange for the right to exclude others from practicing the invention the inventor must describe the invention publicly and the invention becomes the property of society after the patent expires.

6. Brief History – US System • Respect for Patents in US has varied • 1790 – 1890 Pro patent climate • “A country without a patent office and good patent laws was just a crab and couldn't travel anyway but sideways or backwards" (Mark Twain) • 1890’s – Fear of Big Business • Sherman Anti-trust • Patents held invalid in majority of decisions • “Everything that can be invented has been invented” Charles Duell, Director of the U.S. Patent Office, 1899 • 1930’s – Viewed as contributing to Depression • "the only patent that is valid is one which this (the Supreme) Court has not yet been able to get its hands on. (Justice Jackson, 1948)

7. Brief History – US Patent System • 1980’s – Revival of Value for Patents • Establishment of the Court of Appeals for the Federal Circuit (1984) • Only Federal Court that hears appeals based on subject matter and not geography • Jurisdiction includes matters involving international trade, government contracts, patents, trademarks, certain money claims against the United States government, federal personnel, and veterans' benefits. • Lent consistency to patent decisions – was generally pro-patent.

8. U.S. Patent Activity (Utility Patents) (Source: USPTO) Biotechnology Organic chemistry and aerospace Air and auto Electrical and telegraph

9. Patents – The Essence • A grant from the Federal government, enforced by Federal Law • Art. I, Sec. 8 of US constitution: Congress is empower to promote the useful arts • The inventor or patent owner is granted the right to exclude others from practicing his/her invention for a limited period of time. • Generally 20 yr from date of filing • Right to exclude is not right to practice - FTO • Patents benefit society in that: • They encourage innovation, by providing incentive improve or design around the invention, • Their teachings are dedicated to the public after the patent expires.

10. US Patent Activity – Value to Industry • Question: Why do patents drive US industry? • Answer: They capture the “knowledge” component of a product and permit value extraction.

11. Product Pentium Processor Viagra Gold Palm Pilot Saving Private Ryan on DVD Mercedes-Benz Sedan Chevrolet Cavalier Sedan Hot-Rolled Steel Price per Pound $ 42,893.00 $ 11,766.00 $ 4,827.20 $ 1,726.92 $ 874.75 $ 18.98 $ 6.76 $ 0.19 Knowledge as Value

12. US Patent Activity – Value to Industry • Individuals and Industry • 1850 – most patents owned by private inventors • Today only about 12% • 85% owned by corporations • US Patent System is Global – Highly Competitive • Only about 50% of US patents are granted to US entities.

13. US Patent Activity – Value to Industry • Top patenting corporations in United States: 2003 • International Business Machines.............. 3 ,415 • Canon....................................................... 1 ,992 • Hitachi....................................................... 1 ,893 • Matsushita Electric Industrial.................... 1 ,774 • Micron Technology.................................... 1 ,707 • Intel Corporation....................................... 1 ,592 • Koninklijke Philips Electronics.................. 1 ,353 • Samsung Electronics................................ 1 ,313 • Sony.......................................................... 1 ,311 • Fujitsu....................................................... 1 ,302 • SOURCE: U.S. Patent and Trademark Office, Office of Electronic • Information Products, Patent Technology Monitoring Division, special • tabulations (November 2004).

14. DuPont • Innovation • Intellectual Property • New Products

15. DuPont - 204 Years of Innovation Maturity Maturity Growth Growth Maturity Chemistry, Biology, Materials Science Birth Growth Birth Chemistry, Energy Birth Explosives 1802 1830 1850 1900 1925 1945 1990 2000 2050 2090

16. DuPont Science & Technology • 4,400 Scientists and Engineers • 25 R&D Centers, Worldwide • $1.4 B R&D Spend • $20 – 25 M in patent costs

17. External Technology Sourcing Faster Product Development Cycles • TechnologyPartner • Biomedical MaterialsDuPont-MIT Alliance • Biorefinery Solutions NREL, MSU, Diversa • NanotechnologyISN, MIT • ICON, Rice University • Printable Electronics NIST, Lucent • Field Emission Displays Lawrence Berkeley National Laboratory/Nanomix • Microbial Biotechnology Microbia Numerous examples in our product development pipelines:

18. Tracking Our Progress DuPont industrial biotechnology process subject of 7 millionth U.S. patent Goals and metrics drive improvement

19. Products Track Patents

20. Discussion of Patent Basics • Patents – What am I looking at? • Patentable Subject matter • Elements of Patentability • Differences between US and Foreign Law

21. Issue Date Pat. No. Title

24. Patentable Subject Matter • Must be: • composition of matter, machine, article of manufacture, plant, design, or process/method. • Cannot be: • An idea (i.e., Scientific principle, law of nature, or pure algorithm), printed matter, naturally occurring substance (i.e., not purified or genetically engineered), mental steps, or something illegal. • Foreign Law • May additionally exclude some biological inventions, methods of treating patients, patenting living things etc..

25. Elements of Patentability - US • Must be Novel (35 USC § 102) • Cannot be known or used by others more than 1 yr before filing • Cannot be on sale or offered for sale more than 1 yr before filing • Cannot be published more than 1 yr prior to the filing of a patent • Cannot be derived from someone else (inventor did not invent)

26. Elements of Patentability - US • Must be non-obvious (35 USC § 103) • Least well defined aspect of patentability – subject of much prosecution – The standard is currently under review by the supreme court • Invention is obvious over a set of references if: • All the elements are disclosed in the references and • The person of skill in the art would be motivated to combine the references to achieve the object of the invention and • In combining the teachings of the invention the skilled person would have a reasonable expectation of success.

27. Elements of Patentability - US • Must be Useful (35 USC § 101) • Must have a “real world” • Old view – Low threshold • Herbicide vs Fertilizer • Current View • Credible = the skilled person would believe it • Specific = has specific function • Substantial = must have “real world” application • A pure research tool may not be considered “real world”

28. US vs Foreign Law • Novelty • US: inventor has 1 yr to file after a publication appears if she has invented prior to the publication. • Foreign: Any disclosure of the invention prior to filing is novelty destroying, including: • Peer review journal • Patent • Talk • Submitting paper for review to journal without formal confidentiality policy

29. US vs Foreign Law • Obviousness • US: obvious if reasonable expectation of success in view of art • Foreign: (inventive step) need to show unexpected result not taught in the art • Utility • US: Credible, substantial, specific i.e “real world” • Foreign: need to solve a technical problem

30. IP Pitfalls – How Can I Lose My Invention? • Novelty • Best Mode • Inventorship • Duty of Candor

31. How Can I Lose My Invention: Novelty • Prior disclosure of the invention will invalidate the patent • Printed publications, talks, journal submissions not under confidentiality. • Using the invention in a public place • Use of new “post it notes” in the office was considered “known or used by others” even though not disclosed outside • Handing a sample of a compound to a colleague in another institution without an agreement. • On sale more than 1 yr before filing • Includes offering for sale • How to prevent ? • File before public disclosure unless under confidentiality

32. How Can I Lose My Invention: Best Mode • Failure to disclose the best mode of the invention will invalidate the patent • 35 USC § 112: The specification shall contain a written description of the invention, and of the manner and process of making and using it, … and shall set forth the best mode contemplated by the inventor of carrying out his invention. • Best Mode is determined by what the inventor thinks – Subjective - at the time of the filing of the application • Does not have to be claimed – but must be disclosed. • Part of the contract with society • How to prevent? Tell all!

33. How Can I Lose My Invention: Inventorship • Having the wrong inventorship can invalidate a patent (intent to deceive) or make it unenforceable until corrected. • Take home: • Inventorship is defined by a legal standard • Inventorship is not authorship • The invention is defined by the claims • The touchstone of inventorship is conception. An inventor must contribute to the conception of at least one element of a claim. • Inventorship cannot properly be determined in the absence of claims. • Inventorship changes • When is an invention complete? • Conception (Inventor Required) and • Reduction to practice

34. How Can I Lose My Invention: Inventorship • Conception • “Conception is the formation in the mind of the inventor, of a definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice.” Hybritech v. Monoclonal Antibodies (CAFC, 1986) • Can be entirely mental. A fully formed idea or vision of the process or composition, including how to practice the process or make the composition. • Conception can be collaborative – Joint inventions – but both must have contributed to the conception (the idea) of the invention • The conception of the invention is not complete unless there is sufficient knowledge to achieve successful reduction-to-practice, i.e., to “enable” it.

35. How Can I Lose My Invention: Inventorship • Reduction to Practice • The physical manifestation of the inventive conception. • Must be tangible or capable of corroboration, for example: • Actual demonstration • Filed patent applications (constructive reduction to practice) • Reduction to practice can be done by someone other than the inventor Therefore: • Reducing the invention to practice does not necessarily make you an inventor.

36. How Can I Lose My Invention: Inventorship • Preventing incorrect inventorship • Provide Atty. with all information regarding people involved with the work. • Inventorship is a legal determination generally determined by an attorney • Don’t apply the ‘authorship’ standard for peer review journals. Contributors may not be inventors.

37. How Can I Lose My Invention: Duty of Candor • Violating the duty of candor to the PTO can invalidate a patent, and all related applications. • What is the duty of candor • 37 CFR 1.56: Each individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the Office, which includes a duty to disclose to the Office all information known to that individual to be material to patentability as defined in this section

38. How Can I Lose My Invention: Duty of Candor • Who has the duty? • Inventor, patent drafter, Atty, anyone who helps put the application together • When does the duty end? • After the patent grants • What do I have to disclose ? • Anything “Material” to patentability • Technical literature, content of talks, product literature, negative experiments • Unless totally irrelevant, disclose • Does intent to deceive matter? • Yes – but it can be inferred by behavior • Consequences • The present patent and all related patents are invalid. • Roche lost it’s PCR patent estate this way

39. True or False?

40. I got a patent, so that means we can start selling my composition! • False! “Getting a patent” just means you can stop others from practicing your invention. Your “freedom to operate” (FTO) depends on whether there is someone that can stop YOU. Example: Someone has a patent on blends containing A and B and you find A + B + C gives unexpected properties.

41. False: If you just carried out a protocol or did routine measurements at the request of someone else, sorry, no. But... I did all the experimental work, so I’m an inventor. True: If you made an independent intellectual contribution to the conception of the invention as claimed, that’s another story.

42. I know what’s out there. What I did is patentable. We don’t need a search. • False! Not a good idea. To ensure validity you will want to know about all the art that will bear on both the novelty as well as the obviousness aspects of what you are claiming. Not knowing what other patents are out there may lead to filing patents on subject matter that is already claimed.

43. I don’t want to give away the details of the best way to make my invention work. It’s OK for me to leave that out. • False! By law, you must disclose in your application the best way (“best mode”) that you know to practice your invention. If you really don’t want to disclose that, consider keeping it a trade secret, don’t apply for a patent, and don’t publish.

44. We accidentally left out one of the inventors when we applied for the patent. But we can still fix it! • True!Inventorship must be accurate for enforcement. But if you didn’t intend to deceive, this can be corrected. Intent to deceive, i.e., fraud, however, is another matter...

45. Intellectual Property and the DMA • Highlights of the DMA agreement • Procedures • Administrative Best Practices

46. Highlights • Scope of Agreement • First agreement (1/1/1999) covered only biomaterials • Renewal of the agreement (1/1/2005) covers bio-materials, chemistry and material science. • Costs • DuPont is funding 25 million over 5 years • Contacts • Shawna Vogel / Bob Cohen - MIT • Bob Kobos / Mark Nelson - DuPont

47. Programs • May be suggested by either MIT or DuPont but must be approved by the Steering Committee • Projects may be wholly funded by DuPont or may receive non-DuPont funds • If not wholly DuPont funded Steering Committee needs to be informed and approve as funding may affect IP rights

48. Publications • MIT has the right to publish. • DuPont has the right to have confidential information removed from any publication. • DuPont has the right to delay any publication to file patents for limited time • “Publication” means, talk, peer review journal or patent filing.

49. Publications • Timing • MIT has an obligation to send DuPont a copy of the publication 60 days prior to publication. • In practice, the sooner the better – has implications for foreign patent rights. • If patentable material is identified in the publication it can be delayed for no more than an additional 90 days from the time of receipt by DuPont to file a patent. • Both parties should have a “reasonable opportunity” to review drafts of patent applications before filing • In everyone's’ best interest to get as much lead time as possible to vet: • Claim scope, written description, best mode and teaching of the prior art.

50. Confidential Information • Confidential Information is any information exchanged between MIT and DuPont pertaining to the Alliance • Must be marked as confidential • Must be necessary to a Program • Can rely on the confidentiality provisions of the Agreement for preliminary discussions around new Programs • Not a blanket NDA – subject matter must be in furtherance of the DMA • Confidential Information will be maintained confidential for 5 years from the expiration of the agreement. • Standard exceptions apply • Already known by receiver • Is in public domain or becomes public legitimately • Independently developed without knowledge