IPL 24 November 2017

Patent Law
Definitions
Sec. 20 & 21

Restrictions
Sec. 22

Patentability
Subject Matter

DIAMOND VS. CHAKRABARTY, 447 US 303

Brief Fact Summary. Chakrabarty (Plaintiff) sought to patent a live, man-made microorganism.

Synopsis of Rule of Law. A live, man-made microorganism is a non-naturally occurring composition and
therefore may be patented.

Facts.

Chakrabarty (Plaintiff) developed a new species of bacterium capable of metabolizing hydrocarbons in a

manner unknown in naturally occurring organisms using recombinant DNA processes. The
microorganisms exhibited great promise in the treatment of oil spills. Plaintiff applied for a patent, which
was denied by the Patent Office (Defendant) on the basis that the microorganisms were products of
nature and therefore unpatentable. The Board of Appeals affirmed. The Court of Customs and Patent
Appeals reversed, and the United States Supreme Court granted review.

Issue.

May a live, man-made microorganism be patented?

Held.

(Burger, C.J.) Yes. A live, man-made microorganism is a non-naturally occurring composition and
therefore may be patented. Resolution of this issue is, regardless of its philosophical implications, strictly
a matter of statutory construction. The relevant statute here, 35 U.S.C. § 101, defines as patentable any
new and useful “manufacture” or “composition of matter,” among other things. It is a basic rule of
construction that words are given their natural, ordinary meanings. There can be little doubt that
microorganisms produced by recombinant DNA technology may be said to be manufactured and to be
compositions of matter. For purposes of patent law, the fact they are alive is not relevant. Although it is
true that naturally-occurring products may not be patented, a genetically-engineered microorganism is
not naturally occurring. While this Court recognizes that recombinant DNA technology is a controversial
field, it is ill-equipped to balance the competing values and interests manifested therein; this is a task for
Congress. Since the patent laws clearly include materials such as are at issue here within their scope,
and no specific law exists to exclude it, the only appropriate holding is that recombinant DNA-produced
microorganisms are patentable. Affirmed.

Dissent.

(Brennan, J.) Congress, in enacting the Plant Patent Act in 1930 and the Plant Variety Protection Act in
1970, has indicated that bacteria are excluded from patentability. Patent protection must not be
extended further than Congress intended. Congress has not left a legislative vacuum regarding the type
of patent at issue. The Plant Patent Act gives patent protection to developers of certain asexually
reproduced plants. The Plant Variety Protection Act extends protection to certain new plant varieties
capable of sexual reproduction. Therefore, contrary to the majority’s assertion, the patent at issue does
not pose the problem of “unanticipated inventions.” In these two Acts, Congress has addressed the
general problem of patenting animate inventions and has chosen carefully limited language granting
protection to some kinds of discoveries, but specifically excluding others. These Acts show strong
evidence of a congressional limitation that excludes bacteria from patentability. The Acts evidence
Congress’s understanding, at least since 1930, that §101 does not include living organisms. If newly
developed living organisms not naturally occurring had been patentable under §101, the plants included
in the scope of the 1930 and 1970 Acts could have been patented without new legislation. Therefore,
Congress believed that it had to legislate in order to make agricultural “human-made inventions”
patentable, and, because the legislation Congress enacted is limited, it follows that Congress never
intended to make items outside the scope of the legislation patentable.

Discussion.

The general rule is that things occurring naturally in the universe may not be patented. Neither a type of
plant occurring naturally nor a natural principal could be patented. The laws of motion could not have
been patented by Newton. This legal principle appears straightforward, but as demonstrated by this
case, modern science has made it less so.

Novelty
Sec. 23

ROSAIRE VS. NATIONAL LEAD CO., 218 F.2D 72

Brief Fact Summary. National Lead Co. (Defendant) claimed that Rosaire’s (Plaintiff) patents were
invalidated by a prior reduction to practice the same method and therefore Defendant had had not
infringed on Plaintiff’s patents.

Synopsis of Rule of Law. An invention that was known or used by others in this country before the
patentee’s invention is not patentable.

Facts. Rosaire (Plaintiff) claimed to have invented a new method for oil prospecting and held two patents
that National Lead Co. (Defendant) had allegedly infringed. Defendant argued that the patents were
invalidated because Teplitz for Gulf Oil had known and used the alleged inventions extensively before the
date that Plaintiff first conceived the invention. Plaintiff claimed that Teplitz’s work was a failed
experiment that was not published or patented and therefore did not give the public the benefit of the
experimental work. The trial court found that the work by Teplitz was a successful and adequate field
trial of the prospecting method involved and a reduction to practice of that method. The trial court
therefore held that the two patents involved in the litigation were invalid and void and that there had
been no infringement by National Lead (Defendant). Rosaire (Plaintiff) appealed.

Issue. May an invention that was known or used by others in this country before the patentee’s invention
be patentable?

Held. (Tuttle, J.) No. An invention that was known or used by others in this country before the patentee’s
invention is not patentable. The lack of publication of Teplitz’s work did not keep the alleged infringer,
National Lead (Defendant), from claiming prior use as a defense. The work was done openly and in the
ordinary course of the activities of the employer, a large producing company in the oil industry, and
therefore no further affirmative act was required to bring the work public’s attention at large. Affirmed.
Discussion. The non-secret use of a claimed process in the usual course of producing articles for
commercial purposes is considered a public use. “Public” in this case would seem to mean “not secret.”
Those who criticized this expansive view would require that the invention be generally known or used
before creating a statutory bar.

Inventive Step
Sec 26

AGUAS VS. DE LEON, G.R. NO. L-32160, JANUARY 30, 1982

FACTS:

This is a petition for certiorari to review the decision of the Court of Appeals.

On April 14, 1962, respondent Conrado de Leon filed in the CFI of Rizal at Quezon City a
complaint for infringement of patent against petitioner Domiciano Aguas and F.H. Aquino and Sons
alleging among others that being the original first and sole inventor of certain new and useful
improvements in the process of making mosaic pre-cast tiles, and thereafter lawfully acquired from the
Philippine Patent Office, Patent No. 658, the latter infringed the same by making, using and selling tiles
embodying said patent invention. A writ of Preliminary Injuction was subsequently issued.

Petitioner Aguas, in his answer, denied the allegations and instead averred inter alia that
respondent De Leon is neither the original first nor sole inventor of the improvements in the process of
making mosaic pre-cast tiles, the same having been used by several tile-making factories both here and
abroad years before the alleged invention by De Leon; hence, it is not patentable.

The trial court and the Court of Appeals, upon appeal rendered judgment in favor of respondent
de Leon. Thus, this petition.

ISSUE: Whether or not the alleged invention or discovery of respondent is patentable.

HELD: Yea. x x x It should be noted that the private respondent does not claim to be the discoverer or
inventor of the old process of tile-making. He only claims to have introduced an improvement of said
process. In fact, Letters Patent No. 658 was issued by the Philippine Patent Office to the private
respondent Conrado G. De Leon, to protect his rights as the inventor of “ an alleged new and useful
improvement in the process of making pre-cast tiles.” Indeed, section 7, Republic Act No. 165, as
amended provides: “ Any invention of a new and useful machine, manufactured product or substance,
process, or an improvement of the foregoing, shall be patentable.”

Industrial Applicability
Sec. 27

BRENNER VS. MANSON, 383 US 519

Brief Fact Summary. The Patent Office (Defendant) found Manson"s (Plaintiff) process for making certain
steroids unpatentable because it did not disclose a utility for the steroids.

Synopsis of Rule of Law. A process or a product which has no known use or is only useful as an object of
scientific research is not eligible for patent because it is not "useful."
Facts. Plaintiff wanted to patent a process to produce certain known steroids and requested
"interference" be declared to find that his patent application had priority over one filed earlier by Ringold
and Rosenkranz that allegedly covered the process. An "interference" proceeding is used to settle the
priority of patent applications filed close in time on basically the same invention. Plaintiff"s patent
application was rejected for "failure to disclose any utility for" the chemical compound produced by the
process. Plaintiff appealed the decision stating that steroids of a class which included the compound his
product produced were undergoing screening for possibly reducing tumors in mice, and that a homologue
close to his steroid had proven effective in doing so. He also argued that his process would be a useful
step in further research which might develop other useful processes and compounds. The Court of
Customs and Patent Appeals held for Plaintiff.

Issue. Is a process or a product which has no known use or is only useful as an object of scientific
research eligible for patent?

Held. (Fortas, J.) No. A process or a product which has no known use or is only useful as an object of
scientific research is not eligible for patent because it is not "useful." If it was shown that the steroid
produced by this process was likely to reduce tumors in mice it would be sufficient to establish "utility,"
but Defendant determined that was not shown. There for the process was not eligible for patent.
Reversed.

Dissent. (Harlan, J.) In chemistry, one discovery builds upon the next and new processes and products
without "utility," which was too narrowly defined by the majority, may permit someone else to take a
further step leading to a commercially useful item. One job of the patent laws is to encourage this
activity.

Discussion. Before 1950, the question of whether the chemical compound produced by a process which
was the subject of a patent application was "useful" was not addressed. Prior to that time, Defendant
seemed to assume that chemical compounds were necessarily useful and failed to make any specific
inquiries other than determining that the process did indeed produce the designated chemical compound.

BRENNER V. MANSON

Brenner v. Manson, 383 U.S. 519 (1966), was a decision of the United States Supreme Court in which the
Court held that a novel process for making a known steroid did not satisfy the utility requirement because
the patent applicants did not show that the steroid served any practical function. The Court ruled that "a
process patent in the chemical field, which has not been developed and pointed to the degree of specific
utility, creates a monopoly of knowledge which should be granted only if clearly commanded by the
statute."[1] Practical or specific utility, so that a "specific benefit exists in currently available form" is thus
the requirement for a claimed invention to qualify for a patent.[2]

The case is known for the statement "a patent is not a hunting license."[3]

Appellate jurisdiction issue[edit]

The Manson case is the first in which the Court granted a writ of certiorari in an appeal of a patent office
rejection of a patent application. For many years there had been uncertainty whether the United States
Court of Customs and Patent Appeals (CCPA) was an Article III court, and thus one as to which the
Supreme Court had certiorari jurisdiction.[4]

For many years, almost until the eve of the Manson case, the Solicitor General had opposed petitions for
certiorari by disappointed patent applicants on the basis that the CCPA was an Article I court to which the
Supreme Court's certiorari jurisdiction did not extend. In Lurk v. United States,[5] however, the Court
held that judges of the CCPA (as well as those of the Court of Claims) were Article III judges.[6] In the
Manson case the Court expressly held, unanimously, that certiorari was available to review CCPA
decisions.[7]

This paved the way for the US Government to seek review in the Supreme Court of judgments of the
CCPA (and its successor the Federal Circuit) reversing denials of patent applications, which it did
beginning with Manson.

Substantive patent law issue[edit]

Justice Abe Fortas

Justice Abe Fortas delivered the unanimous opinion of the Court on the jurisdictional issue in this case
and the 7-2 opinion of the Court on the issue of utility. Justice John Marshall Harlan II, joined by Justice
William O. Douglas, dissented on the utility issue.

Majority opinion[edit]

The substantive patent law issue in the case was the degree of specific utility a claimed invention must
have in order to qualify for patenting. Andrew Manson applied for a patent on a novel process for making
a form of dihydrotestosterone, a known steroid chemical. A specific use for the product was not known or
disclosed by Manson, although it was hypothesized that it could be screened for possible anti-cancer
utility. Other steroids of similar chemical structure were known to inhibit tumors in mice.[8] The Patent
Office took the position that a process for making a known product could be patented only if the product
had a known utility,[9] while Manson argued, and the Court of Customs and Patent Appeals subsequently
agreed, that it was sufficient for the process to be useful in making the product regardless of whether the
product itself had any particular utility. The Patent Office refused to allow Manson to proceed. He
appealed, and the Court of Customs and Patent Appeals reversed the Patent Office,[10] saying that
"where a claimed process produces a known product, it is not necessary to show utility for the product"
so long as the product "is not alleged to be detrimental to the public interest."[11] The Office then
sought review in the Supreme Court.

The Supreme Court began by considering whether the fact that a closely related chemical had displayed
anti-tumor activity in mice sufficed to satisfy the requirement in 35 U.S.C. § 101 that the subject matter
of a patent must be "useful." The Court said it would not overturn the Office's finding that it did not
follow from the mice data that the claimed process was useful, because whether the steroid product
yielded by Manson's process would have similar tumor-inhibiting characteristics could not be assumed
without proof, given the unpredictability of compounds in the steroid field.[12] Nor was the fact that the
invention was not "harmful to society" sufficient. "There are, after all, many things in this world which
may not be considered "useful" but which, nevertheless are totally without a capacity for harm."[13]

Manson argued that allowing such claims as his would encourage disclosure, discourage secrecy, and
promote efforts to make technological advances. The Court replied that a ’more compelling
consideration" was that the monopoly so granted would discourage inventive activity by others:

[A] process patent in the chemical field, which has not been developed and pointed to the degree of
specific utility, creates a monopoly of knowledge which should be granted only if clearly commanded by
the statute. Until the process claim has been reduced to production of a product shown to be useful, the
metes and bounds of that monopoly are not capable of precise delineation. It may engross a vast,
unknown, and perhaps unknowable area. Such a patent may confer power to block off whole areas of
scientific development, without compensating benefit to the public. 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 with 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 engross what may prove to be a broad field.[14]

Dissent[edit]

In dissent, Justice Harlan argued that the result of the ruling might be to retard chemical progress:

What I find most troubling about the result reached by the Court is the impact it may have on chemical
research. Chemistry is a highly interrelated field, and a tangible benefit for society may be the outcome
of a number of different discoveries, one discovery building upon the next. 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. In my view, our awareness in this age of the importance of achieving and publicizing basic research
should lead this Court to resolve uncertainties in its favor, and uphold the respondent's position in this
case.[15

JUICY WHIP VS. ORANGE BANG, 185 F.3D 1364

Brief Fact Summary. Juicy Whip, Inc. (Plaintiff) sued Orange Bang, Inc. (Defendant), claiming
infringement on its beverage-dispensing patent. Defendant argued the dispenser lacked utility and was
therefore unpatentable.

Synopsis of Rule of Law. The statutory requirement of utility is satisfied if one product can be altered to
resemble another product because that in and of itself is a benefit. An invention does not lack utility for
patent purposes just because it uses imitation to fool the public in a way that is designed to increase
product sales.

Facts. Juice Whip, Inc. (Plaintiff) has a patent for a post-mix beverage dispenser that is intended to look
like a pre-mix beverage dispenser. A post-mix dispenser stores beverage syrup concentrate and water in
separate locations until the beverage is ready to be dispensed. On the other hand, a pre-mix beverage
dispenser pre-mixes the syrup concentrate and water and the beverage is stored in a display reservoir
bowl until it is ready for dispensing. A pre-mix dispenser’s display bowl stimulates impulse buying.
However, this process also creates the need to clean the bowl frequently due to bacteria building up. The
patented dispenser therefore has the appearance of a pre-mix dispenser but functions as a post-mix
dispenser, which decreases maintenance. Plaintiff sued Orange Bang, Inc. (Defendant) alleging it was
infringing on the patent. The district court granted Defendant’s motion for summary judgment and held
the patent invalid due to lack of utility.
Issue. Does the post-mix dispenser that looks like a pre-mix dispenser lack utility?

Held: [Judge not stated in casebook excerpt.] No. The post-mix dispenser does not lack utility. The
Patent Act provides that whoever invents any useful machine may obtain a patent for it. An invention is
useful if it is capable of providing some identifiable benefit. Although inventions that are harmful to the
well-being of society are considered unpatentable, the principle that inventions are invalid if they are
mainly designed to serve immoral purposes has not recently been applied broadly. The district court’s
reliance on the cases of Rickard v. Du Bon, 103 F. 868 (2d Cir. 1900), and Scott & Williams v. Aristo
Hosiery Co., 7 F.2d 1003 (2d Cir. 1925), is therefore misplaced as they fail to represent the correct view
of the doctrine of utility under the Patent Act of 1952. The statutory requirement of utility is satisfied if
one product can be altered to make it resemble another, because that in and of itself is a benefit. It is
common for a product to be designed to appear to viewers to be something that it is not and there are
many patents directed at making one product imitate another. The value of such products is that they
appear to be something that they are not. Here, the post-mix dispenser has utility because it embodies
the features of a post-mix dispenser while imitating the visual appearance of a pre-mix dispenser. Just
because consumers ma believe that they are receiving fluid directly from the display tank does not mean
the invention does not have utility. Even if it was considered deceptive, that does not mean it is
unpatentable. Other agencies, and not the Patent and Trademark Office, are delegated the task of
protecting customers from fraud and deception in the sale of food products. Furthermore, it is the task of
Congress to declare particular types of inventions unpatentable. Reversed and remanded.

Discussion. This case centered on the reasoning that the invention was useful in and of itself because it
was able to create more sales by fooling consumers into believing that it was getting a certain product
when it was really getting something else. The real utility of the product was that it was increasing sales
by providing customers with the appearance of the product without the required cleaning and
maintenance involved in creating the actual product.

Juicy Whip, Inc. v Orange Bang, Inc.

185 F.3d 1364 (Fed. Cir. 1999)

• Juicy Whip obtained a patent on a drink dispenser that made it look like the customer was
getting fresh juice out of a appetizing-looking clear tank on the counter, but in reality they were
getting juice out of a second tank hidden below the counter.
o Juicy Whip claimed that this made it easier to keep the juice free from bacteria and
contaminants and that improved public health.
• Orange Bang began using a similar dispense to attract customers. Juicy Whip sued
for infringement.
o Orange Bang argued that Juicy Whip's patent was invalid because it did not meet the
standard of utility under 35 U.S.C. §101.
! Since the dispenser was "intended to deceive the customer" it didn't meet the
standard for moral utility. (as opposed to practical utility).
• The Trial Court found for Orange Bang and invalidated the patent. Juicy Whip appealed.
o The Trial Court found that the invention lacked utility because its purpose was to
increase sales by deception.
! The Court found that the invention only improved on the prior art by increasing
sales. Therefore it confers no benefit to the public and doesn't deserve patent
protection.
• The Appellate Court reversed.
o The Appellate Court looked to §101 and found that an invention is useful if it is capable
of providing some identifiable benefit.
o The Court found that there are lots of 'useful' products that are imitations of other things
(like cubic zirconium). So the fact that the Juicy Whip invention imitates fresh juice
doesn't mean that it isn't useful.
o The Court found that there was no basis for holding that an invention was unpatentable
for lack of utility simply because it has the capacity to fool some members of the public.
! The Court noted that Juicy Whip's drink machine was perfectly legal, and if
Congress didn't like it, they were free to change the law. However, it was not the
job of the USPTO to displace the police powers of the States and promote the
health, order, peace, and welfare of the community.
• The patent system is not a regulatory body, it only gives you the right to exclude others. It is for
other agencies to determine if the invention can be legally marketed.
o For example, even if you can get a patent on a drug, you can't sell the drug until you get
approval by FDA.

SUMMARY: Juicy Whip, Inc., holder of U.S. Patent No. 5,575,405 (the '405 patent) to a "post-mix"
beverage dispenser, brought suit against Orange Bang, Inc. (Bang) and Unique Beverage Dispensers,
Inc. (Unique) alleging infringement of the claims of the '405 patent. Bang and Unique moved for
summary judgment on the grounds of invalidity. The district court held Juicy Whip's patent invalid for lack
of utility because the patent sought to increase sales through deceptive imitation of another product.

A "pre-mix" dispenser mixes the syrup concentrate and water and stores the prepared beverage in a
reservoir bowl until the beverage is dispensed for a consumer. In contrast, a "post-mix" dispenser stores
the components in separate locations until the beverage is ready to be dispensed. The invention of the
'405 patent contains a transparent display bowl that is filled with a fluid that simulates the dispensed
beverage, yet is resistant to bacterial growth and does not need daily maintenance. In this way, the
dispenser creates the visual impression that beverages are dispensed from the bowl, yet the beverage is
not mixed until immediately before dispensing.

The district court concluded that the invention lacked utility and was thus unpatentable under 35 U.S.C.
� 101. Juicy Whip argued that the invention successfully entices consumers to purchase a beverage and
eliminates the need for retailers to clean display bowls; thus, the invention is useful. The court
acknowledged this argument, yet held the invention did not improve upon the prior art because its only
use was to increase the salability of beverages through deception. Thus, the court concluded the
invention was merely an imitation lacking utility, and therefore unpatentable. Juicy Whip appealed this
decision.

ISSUE & DISPOSITION

Issue(s): Whether a product that improves the prior art by making a product more salable through
deception or imitation has sufficient utility to be patentable under 35 U.S.C. � 101.

Disposition: Yes. A product that increases salability by imitating another satisfies the statutory
requirement for utility. The fact that customers are deceived by the operation of an invention does not
preclude its utility.

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