The Federal Circuit Declines to Rehear En Banc Cell-Free Fetal DNA Appeal
Posted in Litigation, Patents

Last week the Federal Circuit denied Sequenom’s petition for rehearing en banc to review patent eligibility of their cell-free fetal DNA patent, U.S. Pat. No 6,258,540 (the ’540 Patent).  The District Court found the ’540 Patent invalid under 35 U.S.C. § 101 for being directed to ineligible subject matter under the U.S. Supreme Court precedent in Mayo v. Prometheus Laboratories, 132 S. Ct. 1298 (2012). The Federal Circuit affirmed and Sequenom filed the petition for rehearing en banc.

Judge Lourie (joined by Judge Moore) and Judge Dyk wrote separate concurring opinions, and Judge Newman wrote the sole dissent.  While the concurrences and dissent differ in their interpretations of the Supreme Court’s precedent in Mayo, the underlying conclusion is the same—the Federal Circuit’s decision, if left untouched, will likely have chilling effects on the development of, and investment in, the diagnostic industry.  This central thesis is echoed in the numerous amici briefs filed in support of the petition for rehearing en banc.  For example, as argued by the amicus BioIndustry Association, which is represented by Nutter attorneys, “the unintended consequence of the Sequenom decision may be an exodus of investment and businesses from the US market or the life science industry in general.”

Judge Lourie writes that “it is unsound to have a rule that takes inventions of this nature out of the realm of patent-eligibility on grounds that they only claim a natural phenomenon plus conventional steps, or that they claim abstract concepts.”  Yet, Judge Lourie concludes that the Federal Circuit “panel did not err in its conclusion that under Supreme Court precedent it had no option other than to affirm the district court.”  Echoing those sentiments, Judge Dyk writes that “I share the concerns of some of my colleagues that a too restrictive test for patent eligibility under 35 U.S.C. § 101…may discourage development and disclosure of new diagnostic and therapeutic methods in the life sciences, which are often driven by discovery of new natural laws and phenomena.”  Even so, Judge Dyk finds that the Supreme Court’s decision in Mayo compels denial of Sequenom’s petition.  Both Judges Lourie and Dyk conclude that the claims of the ’540 Patent are not subject matter eligible in view of Mayo; however, the Supreme Court, and not the Federal Circuit, would need to revisit this issue.

Judge Newman, in contrast, opines that the claims of the ’540 Patent should survive scrutiny under 35 U.S.C. § 101, even in view of Mayo.  She argues that the claims in the ’540 Patent are distinguishable from those reviewed in Mayo, stating that “[t]he facts of this case diverge significantly from the facts and rulings in Mayo…”  Judge Newman goes on to say that, “the [Supreme] Court recognized the principle that patent eligibility is not disabled when science is put to practical use, stating that ‘a new way of using an existing drug’ is patent-eligible under Section 101.’” As such, Judge Newman finds that the claims in the ’540 Patent would be subject matter eligible under 35 U.S.C. § 101 as “the inventors are not claiming the scientific fact of the discovery of paternal DNA in the blood of a pregnant woman; they are claiming the discovery and development of a new diagnostic method of using this information.”  Thus, Judge Newman concludes that because the claims in the ’540 Patent are directed to a new and useful method of using the scientific discovery, the claims should be found patent eligible under 35 U.S.C. § 101 and subject to review “for compliance with Sections 102, 103, and 112, and any other relevant provisions of the patent law.”

The Federal Circuit’s denial of the petition for rehearing en banc leaves diagnostics in a state of flux.  Should the Supreme Court deny any petition for certiorari filed by Sequenom, the diagnostic industry field will be left having to navigate a global market where patent protection is a must, but where the law of Mayo puts U.S. patent protection in jeopardy[1].  While Judges Lourie, Moore, Dyk, and Newman have presented various reasons why the claims of the ’540 Patent could survive scrutiny under 35 U.S.C. § 101, it is now up to the Supreme Court to correct the application of the Mayo precedent.

[1] See Brief Of The BioIndustry Association As Amicus Curiae Supporting Petition For Rehearing En Banc, Ariosa Diagnostics, Inc v. Sequenom, Inc., No. 14-1139, -1144 (Fed. Cir. Aug. 27, 2015).

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