There are certain patent infringement cases that changed the course of US Patent Law. Every case with its verdict and decisions had huge impacts on the laws, patentability criterion, and the importance of patents.
These patent infringement cases left their mark on the patent law in some way or the other. Some affected the patentability of genetically modified organisms, while others changed the criteria for the determination of patent eligibility. Also, some cases shed light on the patentability of laws of nature natural phenomenon, abstract ideas, etc.
So what were these patent infringement cases about? It was hard to create a list of top 3, but here they are.
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The Most Famous Patent Infringement Cases
These patent infringement cases have no particular order of importance because it’s hard to quantify the magnitude of every decision. Nonetheless, each decision holds a lot of weight and importance.
Diamond v. Chakrabarty (SCOTUS 1980)
Case Number: 447 U.S. 303
This case focused on GMO’s (Genetically Modified Organism). Ananda Mohan Chakrabarty, a genetic engineer, created a bacterium that was a derivation from the Pseudomonas genus. As on date, it is known as Pseudomonas putida. He created it while working for General Electric, who filed the patent with Chakrabarty as the inventor. The application faced rejection from a patent examiner because, at the time, the patent law didn’t consider living things as patentable subject matter.
However, the United States Court of Customs and Patent Appeals ruled the case in favor of Chakrabarty. Their explanation was as follows:
“The fact that micro-organisms are alive is without legal significance for purposes of the patent law.”
Sidney A. Diamond, Commissioner of Patents and Trademarks appealed to the Supreme Court to overturn the ruling. This case had its argument in SCOTUS on March 17, 1980. It was decided on June 16, 1980.
The Verdict
The final decision was a 5-4 ruling, in favor of Chakrabarty. Thereby, it set a precedent for many patent infringement cases and patent grants to follow. The ruling said:
“A live, human-made micro-organism” is a patentable subject matter under 35 U.S.C. § 101. Respondent’s micro-organism consists of a “manufacture” or “composition of matter” inside that statute.”
Mayo Collaborative Services v. Prometheus Laboratories
Case Number: 132 S. Ct. 1289
The case was a dispute between Mayo Collaborative Services and Prometheus Laboratories about a diagnostic test. This case also comprised of 2 US patents: US6355623B2 and US6680302B2. Both belonged to Hospital Sainte-Justine in Montreal. Also, Prometheus is its exclusive licensee. The patents concerned the use of thiopurine drugs in the action of autoimmune diseases. The issue is that every person would metabolize the drugs differently. Hence, the doctors would have to work with patients to find the right dosage.
Prometheus had a patent for this. The process was measuring metabolites in the patient’s blood, with a recognized threshold for efficacy in mind. Then, they decided whether to amplify or reduce the dosage of the drug.
Prometheus sold diagnostic tests based on the patent, and Mayo bought the tests. In 2004, Mayo decided to use and sell a test kit on its own without buying it from Prometheus. Prometheus sued Mayo for this in the Southern District Court of California.
They gave their decision in 2008 and held the patents as invalid. That is because the first two steps were mere “data gathering” and the third step was an unpatentable mental step. Prometheus appealed to the Federal Circuit, who reversed the decision of the District Court in 2009. According to them, the first two steps were not data gathering, but two physical transformations.
Mayo then appealed this to the Supreme Court and it was argued in December 2011.
The Verdict
Finally, in March 2012, the SCOTUS came with a unanimous and rather elaborate ruling. They basically reiterated the ruling of the District Court and further elucidated it.
“Because methods for making such determinations were well known in the art, this step simply tells doctors to engage in well-understood, routine, conventional activity previously engaged in by scientists in the field. Such activity is normally not sufficient to transform an unpatentable law of nature into a patent-eligible application of such a law.”
To sum it up, a newly discovered law of nature itself is unpatentable and the application of this law is also normally unpatentable. However, that is applicable only if the application simply relies upon elements known in the form of prior art.
This, along with the case we will share below, created a big change in the patent law for all forthcoming patent infringement cases.
Alice v CLS Bank
This decision came in 2014 by the SCOTUS. The case was about the patentable subject matter (patent eligibility). Basically, it was about patents on a computer-implemented, electronic escrow service which was used for assisting financial transactions. The issue was that the claims covered abstract ideas that are ineligible for patent protection. Due to this reason, the patents were held to be invalid. Implementing those claims on a computer was not enough to change that idea into the patentable subject matter.
Alice Corporation held four patents on electronic methods and computer programs. They were used for financial-trading systems. The trades between two parties who are to swap payments are settled by a third party in ways that decrease “settlement risk”. Therefore, the risk that one party will carry out while the other will not. Alice alleged that CLS Bank International and CLS Services Ltd. (collectively “CLS Bank”) infringed their patents in 2002.
CLS Bank filed suit against Alice in 2007, to hold the patents invalid. Alice countersued, alleging infringement. The District Court declared each of Alice’s patent invalid. They gave the ruling that the claims concerned abstract ideas, which are not eligible for patent protection under 35 U.S.C. 101.
A panel of the appeals court reversed the lower court’s decision upon Alice’s appeal. But the members of the Federal Circuit vacated that decision and set the case for reargument en banc
They were to determine whether a computer-implemented invention is a patent-ineligible abstract idea. Unfortunately, there was no agreement on any standards.
The Verdict
Finally, the Supreme Court unanimously decided to invalidate the patent. They gave the following explanation for the same:
“Relying on Mayo v. Prometheus, the court found that an abstract idea could not be patented just because it is implemented on a computer. In Alice, a software implementation of an escrow arrangement is not patent-eligible because it is an implementation of an abstract idea. Escrow is not a patentable invention, and merely using a computer system to manage escrow debts does not rise to the level needed for a patent. Under Alice, the “Mayo framework” should be used in all cases in which the Court has to decide whether a claim is patent-eligible.”
The Mayo case, as we mentioned, was a key factor in this judgment. The Court said that it explained how to address the focal problem of this case. Basically, it was determining whether a patent claimed a patent-ineligible abstract idea or instead of a potentially patentable practical implementation of an idea. This requires using a “two-step” analysis, which has famously become the Alice/Mayo test.
Along with it, these 2 cases set up precedence for a lot of patent infringement cases.
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