Utility

1. Utility Intro to IP – Prof Merges Jan. 19, 2010

2. Utility – Section 101 Whoever invents and new AND USEFUL machine, manufacture, . . .

3. Utility • Two Main sets of Issues • Timing: WHEN in the sequence of events leading up to a product innovation should a patent application be permitted? • WHAT TYPES of invention are so “useless” they do not deserve a patent?

4. Development of Organic Molecules In vitro Testing In vivo Testing animals In vivo Testing humans Number of compounds assessed Traditional Chemical/Pharmaceutical Research

5. Cost of Research Development of Organic Molecules In vitro Testing In vivo Testing animals In vivo Testing humans Reasonable correlation between results and utility High biological activity Structural similarity to useful products New compound Results in animals Results in humans Number of compounds assessed Traditional Chemical/Pharmaceutical Research Satisfies Utility Requirement

6. Brenner v. Manson, 383 U.S. 519 (1966) An adjacent homologue of the steroid yielded by the process has been demonstrated to have tumor-inhibiting effects in mice. • failed to disclose a sufficient likelihood that the steroid yielded by the process would have similar tumor inhibiting characteristics. • high unpredictability of compounds in the field.

7. Brenner v. Manson, 383 U.S. 519 (1966) “The basic quid pro quo contemplated by the Constitution and the Congress for granting a patent monopoly is the benefit derived by the public from an invention of substantial utility. Unless and until a process is refined and developed to this point – where specific benefit exists in currently available form – there is insufficient justification for permitting an applicant to [monopolize] what may prove to be a broad field.”

8. Brenner v. Manson • This is not to say that we mean to disparage the importance of contributions to the fund of scientific information short of the invention of something "useful," or that we are blind to the prospect that what now seems without "use" may tomorrow command the grateful attention of the public.

9. Brenner, cont’d • But a patent is not a hunting license. It is not a reward for the search, but compensation for its successful conclusion. "[A] patent system must be related to the world of commerce rather than to the realm of philosophy. * * *"

10. Harlan dissent To encourage one chemist or research facility to invent and disseminate new processes and products may be vital to progress, although the product or process be without ‘‘utility’’ as the Court defines the term, because that discovery permits someone else to take a further but perhaps less difficult step leading to a commercially useful item.

11. What is missing from the Harlan view? • The idea that patents, and IP generally, are only one factor that affects invention, dissemination, and commercialization • Rewards and norms in the practice of scientific research affect research and disclosure

12. The Contemporary View • Patents may interfere with disclosure as much as they facilitate it • IP rights may “squeeze out” research and disclosure that would occur in their absence

13. Scholarly support • Chris Sprigman and Kal Raustiala, "Where IP Isn’t”, Va. L. Rev. In Brief (2007). • Work by Rebecca Eisenberg

14. Working Model or Prototype; in vivo effectiveness Promising Experimental Results: Brenner v. Manson Promising Clinical Results, e.g., in vitro Project Initiation: Pure Concept Stage

15. The Oklahoma Land Rush – A Good Use of Resources?

18. Mining Claim Systems: Require-ments and Timing Issues

19. Some quick economics Terry L. Anderson & Peter J. Hill, The Race for Property Rights, 33 J.L. & Econ. 177 (1990) David D. Haddock, First Possession Versus Optimal Timing: Limiting the Dissipation of Economic Value, 64 Wash. U. L.Q. 775 (1986). Dean Lueck, The Rule of First Possession and the Design of the Law, 38 J.L. & Econ. 393 (1995)

20. Terry L. Anderson – Montana State; Hoover Institution David Haddock, Northwestern Law School

22. In re Fischer • Claim 1 • “Substantially purified” – echoes of Parke-Davis • “Selected from the group consisting of . . .” • What is this claim form?

23. “An article of clothing, selected from the group consisting of Shirts Shoes Pants” “A chemical entity selected from the group consisting of Carbon COOH CH(6)” Markush Group

24. Expressed Sequence Tags Most DNA: Unknown Function EST: Short “Tag” The good stuff: DNA that codes for a protein

25. Multiple Biotechnology Patents: SNP/EST Example A Owns SNP_1 (Or EST_1) B Owns SNP_2/EST_2 C Owns SNP_3/EST_3

26. Fischer • What utilities are claimed? – P. 3 • “determining a relationship between a polymorphism and a plant trait” • “isolating a genetic region . . . Or mapping” • “determining [protein] levels . . .”

27. Fisher - holding • Immediate utility is to conduct further experiments • Too attenuated under Brenner and Brana

28. “Expressed Sequence Tag” Patents: policy issues • Bad Idea! Eisenberg & Merges opinion letter, 1995 • Patent law’s “utility requirement” bars these patents • Why? “Rent Seeking” Dominates incentive motive;Transaction Costs a Major Issue

29. Main Trouble Areas • No known utility (“perpetual motion machines”) • Newman v. Quigg, 877 F.2d 1575 [ 11 USPQ2d 1340] (Fed. Cir. 1989) (claims to a perpetual motion machine ruled inoperable) • Malicious utility • a "useful" invention is one "which may be applied to a beneficial use in society, in contradistinction to an invention injurious to the morals, health, or good order of society, or frivolous and insignificant"

30. Juicy Whip • You can see these themes in this case • “Beneficial utility”

31. Justice Story View • Appendix, Note on the Patent Laws, 3 Wheat. 13, 24. See also Justice Story's decisions on circuit in Lowell v. Lewis, 15 Fed. Cas. 1018 (No. 8568) (C. C. D. Mass.), and Bedford v. Hunt, 3 Fed Cas. 37 (No. 1217) (C. C. D. Mass.).

32. Cubic zirconium Gold Leaf Beneficial (Moral) Utility “The fact that one product can be altered to make it look like another is in itself a specific benefit sufficient to satisfy the statutory requirement of utility.” Juicy Whip, Inc. v. Orange Bang, Inc., U.S.P.Q.2d 1700 (Fed.Cir. 1999)