[Ip-health] KEI blog: Federal Circuit decision in AMP v. USPTO results in three-way split in reasoning; 2-1 decision finds isolated DNA patentable

Krista Cox krista.cox at keionline.org
Mon Aug 1 12:13:42 PDT 2011

Source URL: http://keionline.org/node/1196

Federal Circuit decision in AMP v. USPTO results in three-way split in
reasoning; 2-1 decision finds isolated DNA patentable

By Krista Cox
Created 29 Jul 2011 - 2:07pm

It has been estimated that 1 out of every 8 women [1] in the United States
will develop invasive breast cancer during her lifetime. Although a
diagnostic test exists to identify mutations on the BRCA1 and BRCA2 human
genes, two genes associated with breast and ovarian cancer, many women are
not afforded the opportunity to have testing done because Myriad Genetics
holds exclusive rights over these genes. The tests are often not covered by
insurance companies and Myriad's monopoly power allows it to price the test
at $4,000 which is cost prohibitive for many women. Even if a woman does
have the BRCA testing done, she cannot seek a second opinion because Myriad
has prohibited other companies from testing for BRCA mutations. This lack of
testing by competitors is especially harmful to women who are minorities;
studies have shown that Myriad's test is flawed and has failed to identify
all mutations, particularly for women of color. The results of the
diagnostic testing is often critical in predicting a woman's susceptibility
to breast cancer (women who have a mutation on one of these two genes are up
to 80% more likely to develop breast cancer) and in determining the most
appropriate course of treatment.

Although the USPTO has granted patents on human genes for the past thirty
years, on March 29, 2010, federal district court judge, Robert Sweet,
rejected the claim that one can patent isolated DNA or cDNA. Judge Sweet
ruled that genes are a product of nature and therefore not patentable under
35 U.S.C. Section 101.

On Friday, July 29, 2011, the Federal Circuit issued its opinion [2]
determining the patentability of the BRCA 1/2 gene claims in American
Molecular Pathology, et. al., v. U.S. Patent and Trademark Office, et. al.,
reversing the District Court's ruling (and rejecting the U.S. Department of
Justice's position [3] which argued against the patent eligibility of
isolated DNA). Oral arguments for this case were previously heard [4] in

With regard to the merits of the case, a three-way split in reasoning
emerged as to the patentability of isolated DNA. Judge Lourie, [5] appointed
to the Federal Circuit by President George H.W. Bush, authored the majority
opinion which found that isolated DNA and cDNA are patent eligible and also
found patentable Myriad's method claim on screening potential cancer
therapeutics by tracking changes in cell growth rates. It did, however,
affirm the lower court ruling with respect to Myriad's method claims which
involved comparing or analyzing DNA sequences. Judge Moore, [6] a President
George W. Bush appointee, concurred in the outcome, agreeing that isolated
DNA is patentable, but came to this conclusion through a different reasoning
(while Judge Lourie's opinion focused only on the structural differences
between isolated DNA and that found in nature, Judge Moore suggested that
the proper test also requires a difference in utility). Judge Bryson [7],
appointed by President Clinton, dissented and argued against the patent
eligibility of isolated DNA (Like Judge Moore, Judge Bryson's decision
examined both the structural differences as well as utilitarian differences,
but ultimately came to a different conclusion).

First, the Federal Circuit necessarily ruled on the threshold standing
issue, affirming jurisdiction over the case because it determined that "at
least one plaintiff, Dr. Harry Ostrer, had standing to challenge" Myriad's
patent claims.

It should be noted that just two days prior to the release of this decision,
the Defendants-Appellants in the case filed a notice with the Federal
Circuit further challenging Dr. Ostrer's standing claim. Dr. Ostrer is
leaving NYU Langone and will be employed by the Department of Genetics at
Albert Einstein College of Medicine; Albert Einstein College of Medicine
does not offer genetic testing and thus, the Defendants-Appellants argue
that standing can no longer be based on a claim by Dr. Ostrer. Because of
the short length in time between the filing of this notice and the
publication of the Federal Circuit opinion, the Federal Circuit did not
consider this claim. A few hours after the opinion was published,
Plaintiffs-Appellees responded to the notice, alleging factual inaccuracies
in Defendants-Appellants claim. The letter states that Dr. Ostrer will be
employed at the Department of Genetics at Albert Einstein College of
Medicine and Montefiore Medical Center. The Montefiore Medical Center, the
letter notes, has the same immediate capacity to engage in genetic testing
and that Dr. Ostrer's standing therefore is not affected.

In ruling on the isolated DNA issue, Judge Lourie--whose opinion was more
broad and more of a blanket approval of patentability for isolated DNA than
the concurring opinion--determined that these claims were patent eligible
based on their "markedly different" characteristics from what exists in
nature. Citing Supreme Court precedent in Chakrabarty, 477 U.S. 303 (1980),
the majority opinion noted that

The distinction . . . between a product of nature and a human-made invention
for purposes of § 101 turns on a change in the claimed composition's
identity compared with what exists in nature.

Lourie begins his analysis in this regard by noting that DNA found in nature
exists in the body as "one of forty-six large, contiguous DNA molecules"
while isolated DNA is a "free-standing portion" that "has been cleaved
(i.e., had covalent bonds in its backbone chemically severed) or synthesized
to consist of just a fraction of a naturally occurring DNA molecule." He
distinguishes the idea of "purified DNA" from "isolated DNA" noting that
isolated DNA involves the breaking of covalent bonds, which, he claims,
alters the makeup of the DNA. This focus on the break in covalent bonds is
unsurprising given Judge Lourie's similar note during oral arguments.

While the district court rejected the patentability of isolated DNA
molecules on the grounds that their genetic function is to transmit
information, Judge Lourie reversed finding instead that patent eligibility
is "not negated because it has similar information properties to a
different, more complex natural material that embodies it." Judge Lourie
focused on the structure of the isolated molecules rather than their

Additionally, the majority opinion cited the "longstanding practice of the
PTO" to grant patents on isolated DNA molecules as support for its decision.
However, as the dissent notes, the PTO's position is undercut by the fact
that the U.S. DOJ filed a brief in the matter arguing against the
patentability of isolated DNA and the Solicitor General personally appeared
at Oral Arguments. Judge Lourie (as well as Judge Moore's concurring
opinion) suggested that it was more appropriate for Congress to address the
matter and reverse this practice of the USPTO to grant patents on isolated
DNA than for the courts. Both the majority opinion and concurring opinion
seemed to give considerable deference to the USPTO and weight to the fact
DNA claims have historically been permitted.

Only one of Myriad's method claims (claim 20 of patent claim '282), that
involving a method for screening of potential cancer therapeutics through
changes in cell growth rate, survived the patent challenges. All three
judges were in agreement holding this one method claim to be patent
eligible. However, all three judges rejected the rest of Myriad's method
claims which all involved merely "comparing" or "analyzing" DNA sequences.
The Federal Circuit held that such claims did not include any transformative
steps (failing the machine-or-transformation test) and involved only
abstract, mental steps which cannot receive patent protection.

Judge Moore joined in the majority opinion with respect to standing, the
method claims, and cDNA, but only concurred in judgment on the isolated DNA
claims. While she also found isolated DNA to be patent eligible, she
rejected Judge Lourie's implications that because an invention does not
exist in nature in the exact state as in its claimed state it is
automatically subject matter eligible for patent protection. Citing the
tests provided for by the Supreme Court in Chakrabarty and Funk Brothers,
333 U.S. 127 (1948), Judge Moore rejects the reasoning used in the majority
opinion stating, "Although the different chemical structure does suggest
that claimed DNA is not a product of nature, I do not think this difference
is alone necessarily makes isolated DNA so 'markedly different.' from
chromosomal DNA so as to be per se patentable subject matter." Instead, in
finding the isolated DNA claims to be patent eligible, Judge Moore relies on
"as precedent instructs . . . whether these differences impart a new utility
which makes the molecules markedly different from nature." She determines
that because the isolated sequences can be used as primers in diagnostic
tests, they have a new utility in its isolated form that is distinct from
its function in nature. Ultimately, Judge Moore determines that

Because the different chemical structure of the isolated DNA, which is a
product of the intervention of man, leads to a different and beneficial
utility, I believe small, isolated DNA fragments are patentable subject

She does, however, caution that her decision may be different were she
deciding the case "on a blank canvas" and might instead find that isolated
DNA sequences "that includes most or all of a gene is not patentable subject
matter" because it does not have a new utility.

Unlike Judges Lourie and Moore, Judge Bryson determined that isolated DNA
claims are not patent eligible. Concurring in judgment with respect to
standing, cDNA (agreeing with the general acceptance of cDNA as patent
eligible, but disagreeing with respect to two specific overly broad cDNA
claims), and the method claims determinations, Judge Bryson found that
Myriad's BRCA gene claims (the isolated DNA claims) were not eligible for
patent protection.

In Judge Bryson's determination, the claims-at-issue are directed to facts
which are not patentable. He notes the distinction between facts and
application of facts, stating:

Of course, Myriad is free to patent applications of its discovery. As the
first party with knowledge of the sequences, Myriad was in an excellent
position to claim applications of that knowledge . . . Yet some of Myriad's
challenged composition claims effectively preempt any attempts to sequence
the BRCA genes, including whole-genome sequencing. In my view, those claims
encompass unpatentable subject matter, and a contrary ruling is likely to
have substantial adverse effects on research and treatment in this important

Like his colleagues, Judge Bryson also relies on the Chakrabarty case, but
in his application of this precedence finds that the isolated DNA claims
"clearly" are not patent eligible because these genes appear in nature and
the "only material change . . . from their naturally state is the change
that is necessarily incidental to the extraction from the genes from the
environment in which they are found in nature." Acknowledging that the
extraction process may be difficult, Judge Bryson argues that the level of
difficulty cannot make a naturally occurring item an invention.

Judge Bryson rejects Judge Lourie's position stating that "there is no magic
to a chemical bond that requires us to recognize a new product when a
chemical bond is created or broken." He cites the fact that isolated DNA
"have the same sequence, they code for the same proteins, and they represent
the same units of heredity" and therefore concludes that isolated DNA is not
markedly different from that which is naturally occurring.

Judge Bryson also disagreed with the deference his colleagues gave to the
USPTO on three grounds. He first noted that the USPTO "lacks substantive
rulemaking authority as to issues such as patentability" and that the court
only owes difference commensurate with the thoroughness and validity of the
USPTO's reasoning. Secondly, Judge Bryson suggested that USPTO's position
was "substantially undermined by the position the government has taken in
this case." Because the DOJ filed a brief advocating for the Federal Circuit
to uphold the District Court's decision with respect to isolated DNA, the
court is

left to guess about the status of any possible continuing interagency
disagreement about the issue, the Department of Justice speaks for the
Executive Branch, and the PTO is part of the Executive Branch, so it is fair
to assume that the Executive Branch has modified its position from the one
taken by the PTO.

Finally, Judge Bryson also pointed out that the Supreme Court in Chakrabarty
did not appear to give deference to the USPTO's position in that case and
instead cited a responsibility under the Constitution to interpret the
language Congress used in defining patentable subject matter under Section
101. By deferring to the USPTO's past practice of granting patents on
isolated DNA, in Judge Bryson's view, Judge Lourie and Judge Moore's
positions gives the USPTO lawmaking power which was never granted to the
agency by Congress. Judge Bryson concludes, "There is no collective right of
adverse possession to intellectual property, and we should not create such a

This case will likely be appealed, either first to an en banc sitting of the
Federal Circuit, or directly to the Supreme Court.

[2] http://www.cafc.uscourts.gov/images/stories/opinions-orders/10-1406.pdf
[4] http://keionline.org/node/1108
[5] http://www.cafc.uscourts.gov/judges/alan-d-lourie-circuit-judge.html
[6] http://www.cafc.uscourts.gov/judges/kimberly-a-moore-circuit-judge.html
[7] http://www.cafc.uscourts.gov/judges/william-c-bryson-circuit-judge.html

Krista Cox
Staff Attorney
Knowledge Ecology International
(202) 332-2670

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