Sunday, October 31, 2004

Chicago Maroon on drug patents

from Laura Hamilton in the (University of) Chicago Maroon, October 31, 2004:

This embarrassing failure [note: flu vaccine, 2004], however, highlights the fact that our health-care system is broken. American commercial medicine was founded on capitalist principles: Reward innovation with patents and allow private companies to behave as they please [note: perhaps subject to the FDA], and the market will do the rest. The system worked brilliantly for decades, and America enjoyed health care second to none.

What went wrong?

Like any good conservative, I would at once suggest: Blame Canada. Less enlightened countries with varying degrees of socialism, most notably Canada, have scoffed at the free-market theory. They place price controls on patented American drugs. The Canadians still believe you can “eat your cake and have it too,” as they like to phrase it. Americans pay more for American-made drugs than Canadians do—because Americans trust the market to work. Seventeen [sic] years of high drug prices are the incentive for pharmaceutical research and innovation, and the dollars consumers pay are directly reflected in medical strides forward. Essentially, Americans are subsidizing innovations from which the Canadians benefit disproportionately.

Which leads us to these hare-brained “import drugs from Canada” schemes. If politicians want to adopt price controls, they should at least admit it. So we don’t have to ask Canada for drugs. America should really have more pride than that.

Big-pharmaceuticals, whom we can thank for ampicillin, acetaminophen, and fluoxetine, among others, are understandably disconcerted by this bizarrely engineered flouting of American patent traditions. The obvious conclusion—here I want to make it clear that this is not my conclusion, personally, but rather a conclusion that is obvious in a general sort of way from the situation as I have presented it above—would be for big-pharmaceuticals to stop selling drugs to Canada. The only problem would be that Canada might get a little upset, in the sense that it would be a diplomatic disaster, just below the magnitude of the assassination of Archduke Ferdinand.

--> Of Hamilton's reference to fluoxetine, perhaps Hamilton should check out the Winston & Strawn webstite, especially the words "nearly 27 years":

In one of the most significant patent decisions in many years, the Federal Circuit recently invalidated the key patent for Prozac®, the world's leading antidepressant with annual U.S. sales exceeding a billion dollars. See Eli Lilly & Co. v. Barr Laboratories, Inc., 2000 WL 1114915 (Fed. Cir. 2000).

The dispute focused on several patents for fluoxetine hydrochloride, which is Prozac’s active ingredient. Barr Laboratories, represented by Winston & Strawn, contended that Lilly’s main patent was invalid for double patenting. This patent was not scheduled to expire until December 2003. Barr argued that Lilly had improperly extended its patent protection by obtaining multiple patents on slight variations of the same basic invention. By obtaining multiple patents, Lilly extended its patent monopoly on Prozac to nearly 27 years, almost a decade beyond the term Congress authorized.

Friday, October 29, 2004

Ranbaxy files with FDA over zidovudine (ZDV)

Another patent issue is illustrated by Ranbaxy's application to the FDA for approval for its version of zidovudine [zdv; RETROVIR]. Ranbaxy's application is related to its proposed use of zidovudine OUTSIDE OF the United States, although to be distributed by US-backed agencies. The presence of US patents forecloses this distribution in the United States.


India's Ranbaxy Laboratories Ltd. said on October 29, 2004 it had filed an application with the U.S. Food and Drug Administration for approval of its anti-retroviral drug zidovudine tablets used to treat AIDS. [Zidovudine is the generic name for Retrovir, manufactured by GlaxoSmithKline, which was the first drug approved for the treatment of HIV, in 1987. It is in a category of HIV medications called nucleoside reverse transcriptase inhibitors (NRTIs). Retrovir prevents HIV from altering the genetic material of healthy T-cells. This prevents the cells from producing new virus and decreases the amount of virus in the body.]

The U.S. government has so far refused to buy generic AIDS drugs under its $15 billion emergency AIDS plan, saying that the FDA and not the World Health Organisation (WHO) should assess the quality of medicines.

If it gets approval, Ranbaxy's drugs could be distributed by U.S.-backed agencies in Africa and other poor countries. But they would not be sold in the United States, due to patent protection.

The WHO had removed three Ranbaxy-made generic AIDS drugs from its approved list in August, amid concerns over their safety after finding that the independent laboratory used by Ranbaxy to prove they were equivalent to brand-name drugs did not meet international standards.

Cohn article: increased competitiveness adversely affecting inventors

An article by Meredith Cohn in the Baltimore Sun on October 29, 2004 argues that it is getting harder for individual inventors to sell their ideas. The article observes that the number of patent applications in the United States is at an all time high.

This viewpoint is a different take on things from that of Quillen and Webster. Cohn looks at the number of patent applications and sees increased competitiveness. Quillen/Webster look at the increased patent grants and see lowered quality at the PTO.

Excerpt from Cohn:

-->Inventors then can pitch their products directly to manufacturers, distributors or companies that would license the product. Recently, some big corporations have begun accepting pitches from inventors.

Dial Corp., maker of the household products Dial, Purex and Renuzit, set up a Web site this month through which inventors can submit their patented or patent-pending ideas to complement the soap, laundry detergent and air fresheners already in the company's lineup. Dial is looking for new products and creative packaging and dispensing systems.

But DiForte, 60, knows having a new and appealing product doesn't guarantee success. After a career as an inventor, with some products actually making it to market, he believes his latest life belt invention, called The Survivor, is his best work.

He said he has spent years and much of his savings on the belt, with his first patent won on it in 1992. But never has he encountered such resistance from buyers and investors. They tell him they already offer a full line of personal flotation devices. But he can't let it go.

Thursday, October 28, 2004

Lamellar buckyballs?

US Patent 6,809,046 (issued October 26, 2004) states: Inorganic solid particles having a lamellar fullerene (buckyball) structure are also useful in the present invention.

Gee, isn't carbon of a lamellar structure called "graphite"? Pure buckyballs have a cubic structure. Materials having a lamellar structure can be composed of sheets or plates of atoms in hexagonal array, with strong bonding within the sheet and weak van der Waals bonding between sheets, providing low shear strength between sheets. A nonlimiting example of a lamellar structure is a hexagonal crystal structure, such as P63/mmc of graphite.

The '046 is directed to non-heat cleaned glass fiber fabrics comprising resin compatible coatings that offer higher tensile strengths than corresponding fabrics that have been heat cleaned and silane finished. These fabrics can be used in a wide variety of applications, such as reinforcements for composites such as printed circuit boards.

Haven for plagiarism?

A recent article in expresses concern that Europe might become a haven for plagiarism.

One might have thought Harvard Law School was in the running for that moniker.

-->EICTA, the European IT and communications industry association, a group of some of the world's leading IT and telecommunications companies have warned that Europe could become a "haven for plagiarism" if the European Parliament fails to agree to allow patent protection for inventions implemented by computer.<--

The article also notes

-->The group warns that if members of Parliament (MEPs) insist on some of the amendments they requested when they were first asked their views on the directive, it would "seriously threaten research and development in Europe" and put thousands of highly skilled jobs at risk.<--

Gee, thousands of highly skilled jobs are already at risk to offshoring.

Labcyte's US 6,802,593 on acoustic ejection

from businesswire
SUNNYVALE, Calif.--(BUSINESS WIRE)--Oct. 27, 2004--Labcyte Inc. announced today that it has been granted US patent 6,802,593 for rapidly transferring fluids from a multi-well plate with acoustic energy. This patent describes the use of focused acoustics for the transfer of liquids at speeds greater than one second per well.

Dr. Elaine J. Heron, Chief Executive Officer of Labcyte Inc., said, "This patent covers our enablement of a process that simultaneously meets the speed, accuracy and low volume needs of life science researchers. It describes liquid transfers at rates that keep pace with the other steps in high throughput screening and other industrialized assay processes in all well-plate formats including 96-, 384-, 1536-well micro-plates and other high-density formats. Four major pharmaceutical companies are now using this process in our award-winning Echo 550 compound reformatter to precisely transfer nanoliter volumes." <--

The priority chain for US '593 is as follows:

This is a continuation of U.S. patent application Ser. No. 09/964,212, filed Sep. 25, 2001, which issued on Dec. 23, 2003 as U.S. Pat. No. 6,666,541, which is a continuation-in-part of U.S. patent application Ser. No. 09/727,392, filed Nov. 29, 2000, now abandoned, which is a continuation-in-part of U.S. patent application Ser. No. 09/669,996, filed Sep. 25, 2000, also abandoned. The disclosures of the aforementioned applications are incorporated by reference herein.

The first claim for US '593 recites:

A device for acoustically ejecting a droplet of fluid from each of a plurality of fluid reservoirs, comprising:

a plurality of reservoirs each adapted to contain a fluid, wherein the distance between the centers of any two adjacent reservoirs is less than about 1 centimeter;

an acoustic ejector comprising an acoustic radiation generator for generating acoustic radiation and a focusing means for focusing the acoustic radiation generated; and

a means for positioning the acoustic ejector in acoustic coupling relationship to each of the reservoirs.

** The final element of the claim, including the words
--a means for-- is an example of a means plus function claim (35 USC 112, paragraph 6).

Wednesday, October 27, 2004

US 6,805,663: beyond the swing and peanut butter and jelly to shared erotic experience

US Patent No. 6,805,663, Method of shared erotic experience and facilities for same. The inventors are Vince and Liz Bugliosi of Grand Terrace, CA. The involved law firm is Cislo & Thomas, LLP.

The patent is self-identified as a "business method" patent:

This invention relates generally to a business method for providing a shared erotic experience and to facilities to accomplish that purpose.

The patent solves a problem associated with adult children still living at home with their parents:

-->In big cities in Japan such as Tokyo, young people well into their twenties often still live at home with their parents, but need a private place to go for watching adult entertainment and having sex. Many Japanese Love Hotels have sprung up having small rooms available for a reasonable price including such entertainment, some with interesting decor including following certain themes. While not entirely different in principle than a conventional small hotel, these establishments serve their purposes in Japan.<--

The summary of the invention of the '663 states:

-->A method of sharing erotic experiences includes providing a building with a number of compartments and entertainment viewable from inside the compartments. Participants enter the building and the compartments and the entertainment starts at a prescribed time. Preferably shortly thereafter, a stimulation device for sexual pleasure starts in each of the compartments. Then the facilities are such that sounds from the participants are transmitted between the compartments, such that couples or individuals in one compartment can hear couples or individuals in other compartments.<--


A method of sharing erotic experiences includes
providing a building with a number of compartments,
entertainment viewable from inside the compartments
and surround sound music audible throughout the
building, participants entering the building and go to
the compartments, starting the entertainment at a
proscribed time, and turning on the power from a
central control booth at a proscribed time to a
stimulation device for sexual pleasure found in each
of the compartments. The facilities are such that
sounds from the participants are transferred between
the compartments, such that couples or individuals in
one compartment can hear others in the building also
experiencing intense sexual pleasure. The individual
compartments may further contain a whirlpool tub with
jets starting at a proscribed time. Importantly,
security is provided to maintain order in the
building, and regular cleaning and sanitizing of the
compartments and stimulation device is provided.

There are three indepedent claims (1, 7, 11).

The first claim of the '663 is a method claim and recites:

A method of sharing erotic experiences comprising the steps of:

providing a building with a plurality of compartments and entertainment viewable from inside the compartments;

admitting participants to the building and the compartments;

starting the entertainment viewable from inside the compartments at a prescribed time;

starting a stimulation device for sexual pleasure in each of the compartments at a prescribed time; and,

transferring sounds from the participants between the compartments.

The seventh claim recites:

Facilities for a shared erotic experience comprising:

a building with a high ceiling and having a plurality of walled compartments each without a ceiling; and,

a hot water tub for each compartment,

the compartments containing furniture for reclining thereon and a stimulation device for sexual pleasure,

whereby sounds may be easily transferred between the compartments for entertainment of participants.

a building with a high ceiling and having a plurality of walled compartments each without a ceiling; and,

the compartments containing furniture for reclining thereon and a stimulation device for sexual pleasure,

whereby sounds may be easily transferred between the compartments for entertainment of participants, and

wherein the stimulation devices are coupled to a central control booth.

The 11th claim recites:

Facilities for a shared erotic experience comprising:

a building with a high ceiling and having a plurality of walled compartments each without a ceiling; and,

the compartments containing furniture for reclining thereon and a stimulation device for sexual pleasure,

whereby sounds may be easily transferred between the compartments for entertainment of participants, and

wherein the stimulation devices are coupled to a central control booth.

Injunction against Static Controls lifted in Lexmark copyright/DMCA case

The Sixth Circuit lifted the injunction against Static Controls, but the ultimate merits of the case remain to be decided. Although each of the three judges wrote individual opinions, the court as a whole noted that its opinion concerns only the preliminary injunction that had been issued against Static Controls, and leaves a decision on a permanent injunction in the hands of the district court, to which the case is now remanded.

ZDNet news reported:

-->The court said that "lock-out" codes in software that's designed to control or limit interoperability is not covered by the original-expression intentions of copyright law. Furthermore, said the court, SCC's reverse engineering was not a circumvention of Lexmark's Toner Loader Program but a replacement of it, so even if the code had been covered by copyright, SCC's implementation would have been allowed under the fair-use doctrine. <--

ZDNet also noted:

-->When printer ink costs more than perfume, something smells wrong. So when Gartner recently did a few simple sums and worked out that, at £1,200 a litre, printer ink costs more than Chanel No.5, it's hardly surprising that a few eyebrows were raised. <--


The decision of the three judge panel of the Court of Appeals for the Sixth Circuit was split.

Judge Jeffrey Sutton wrote that "because Lexmark failed to establish a likelihood of success on any of its claims, whether under the general copyright statute or under the DMCA, we vacate the district court's preliminary injunction and remand the case for further proceedings."

Judge Gilbert Merritt wrote a separate concurrence ("We should make clear that in the future companies like Lexmark cannot use the DMCA in conjunction with copyright law to create monopolies of manufactured goods for themselves."), and the panel's third member, U.S. District Judge John Feikens, issued his own opinion, which dissented in part from the ruling.

The economic significance is great. In the past, there were great patent wars, involving among others Hewlett-Packard, concerning the repair/reconstruction issue over the act of re-filling cartridges. Sales of cartridges and other printer supplies are a major part of Lexmark's business, especially because the prices of printers and other computer hardware have fallen in recent years. The average business spends 1 percent to 3 percent of its annual revenue on ink and paper, Lexmark has said. The goal is to capture as much of that market as possible.

Another case wherein an injunction in an IP case was lifted, was that against Barnes & Noble (BN) in the case over the double-click patent. That case settled and the question of the validity of the amazon patent was not decided. In the Lexmark case, it is more likely that the merits of the DMCA claim will be addressed by the district court (in the present remand) and possibly by the Sixth Circuit, on any later appeal. PCWorld reported Merrill Lynch analyst Steven Milunovich says in a research note that he is "somewhat surprised" at the appeals court ruling but does not expect it to significantly affect Lexmark's business.

In the near term, the analysis by Milunovich may be correct, but if the rejection of the concept of using the DMCA to foreclose interoperability remains, Lexmark (and others) may have a problem. The margins on replacement printer cartridges will shrink and this will resemble the generic drug business.

Profits drop at Dr. Reddy's

Not having had a major generic drug release since 2002, Dr. Reddy's reports net profits down 44% in the last quarter.

Dr. Reddy's is India's only New York Stock Exchange-listed drug maker, is India's biggest spender on drug R&D as a percentage of sales (12%), and earns a majority of its revenue -- 60 percent in the quarter ended Sept. 30 -- from outside India.

NanoInk licences patent from University of Illinois

The licensing of US 6,642,129 from the University of Illinois to NanoInk represents another Bayh-Dole case. The first page of US 6,642,129 states: This invention was made with United States Government assistance through Defense Advanced Research Projects Agency (DARPA), Contract No. NW 0650 300 F 245. The Government has certain rights in this invention.

The abstract states:

A microfabricated probe array for nanolithography and process for designing and fabricating the probe array. The probe array consists of individual probes that can be moved independently using thermal bimetallic actuation or electrostatic actuation methods. The probe array can be used to produce traces of diffusively transferred chemicals on the substrate with sub-1 micrometer resolution, and can function as an arrayed scanning probe microscope for subsequent reading and variation of transferred patterns.

The first claim recites:

An apparatus for applying a pattern to a substrate for nanolithography, the apparatus comprising:

at least one patterning compound;

an array of actuated probes, said array of actuated probes being arranged in parallel, wherein each of said actuated probes comprises:

a cantilever;

a tip at an end of said cantilever for applying one of said at least one patterning compound to said substrate; and

an actuator operatively coupled to said cantilever, said actuator being responsive to an applied current or voltage to move said cantilever so as to move said tip relative to said substrate.

from businesswire:

NanoInk, Inc. announces its worldwide, exclusive license of a family of patents from the University of Illinois. The family is entitled "Nanoscale Chemical Surface Patterning Dip Pens" and
includes United States Patent No. 6,642,129 and numerous foreign filings. This license adds to NanoInk's sizable patent portfolio, which already includes over 100 filings.

The technology licensed involves arrays of "active pens" for performing nanoscale lithography, and it resulted from the work of Dr. Chang Liu, NanoInk Scientific Advisory Board member and Associate Professor in the Department of Electrical and Computer Engineering at the University of Illinois - Urbana-Champaign. The arrays are important for improving the flexibility and
speed of the Dip Pen Nanolithography(TM) (DPN(TM)) process for
nanofabrication, and as a result, for its possible industrial applications.

Tuesday, October 26, 2004

Article by John Carey in Business Week

An article by John Carey, Flying High?; Long the innovation leader, the U.S. now has serious competition from abroad. Is America's research lead in danger?, in Business Week (October 11, 2004) is worth a look.

It perhaps does not fully come to grips with the consequences of establishment of research labs by US companies in foreign countries (eg, GE in Bangalore, DuPont in Shanghai, Cummins in Pune). Further, it perhaps does not fully come to grips with the visa issue; there are many U.S.-born scientists who are not being optimally used (remember the comments of Dr. Hale of Hale-Bopp fame?) It is true that US companies need to look globally, but it is also true that the US, as a country, needs to preserve its scientific infrastructure.

Additionally, the comment about leading the world in patents is a close call.


-->With more than 10 million people with degrees in science or engineering, America still leads the world in scientific papers and patents. But other nations are catching up fast. Within a few years, China plans to graduate 350,000 new engineers annually. In contrast, U.S. universities produce less than 100,000 per year. And as many other nations invest heavily in science and technology, the number of papers and patents from researchers in Taiwan, South Korea, Hong Kong, and Singapore is soaring. The world is increasingly populated with innovators. ``We are at a watershed in the global economy,'' says Denis Fred Simon of Rensselaer Polytechnic University.
Overall, this global innovation explosion ``is a good thing. We want a productive world,'' says C. Paul Robinson, president of Sandia National Laboratories. But it presents new challenges for the U.S. Companies increasingly need to scour the world for ideas. In the future, ``the U.S. can only count on making at most one in five inventions,'' predicts Greg E. Blonder, a former Bell Laboratories scientist who is now a venture capitalist. The good news is that U.S. researchers appear to be rising to this challenge by tapping into overseas talent. The Georgia Institute of Technology, for instance, is working with Bangladesh scientists on monsoon forecasting and is also collaborating with universities and companies across Asia and Europe in fields such as microelectronics and advanced sensors. Says provost Jean-Lou Chameau: ``Nowadays it would be very arrogant to think that we have all of the research expertise concentrated in one area or country.''
Collaboration becomes ever more important as the flow of talent to the U.S. slows. Greater opportunities in countries outside the U.S. mean that fewer foreign-born researchers will be studying, working, and staying in the U.S. The number of visas granted to foreign scientists and engineers has been declining since 2001, aggravated by restrictions imposed to fight terrorism. Because of foreign students' visa troubles, ``there has been a precipitous drop in graduate school applications,'' says James S. Langer, vice-president of the National Academy of Sciences. ``It is having a major effect on science and technology in the U.S.
Bush administration officials stress that the visa problem is not easy to solve. ``Imagine the outcry if we let a terrorist in to study biological methods or physics,'' says C. Stewart Verdery Jr., Assistant Secretary for Border and Transportation Security Policy and Planning at the Homeland Security Dept. Still, he says: ``We agree that if we make it unduly difficult for people to come and work in high tech, we will have done serious damage.''
That's why the Administration is taking action. And there may be reason for optimism on the visa front. A Sept. 7 letter to the scientific community from the State Dept. claims that ``98% of all Visa Mantis cases [which involve a security check designed to protect against sensitive technology transfers] are being cleared in less than 30 days.'' While skeptical scientists are waiting for firm proof, ``we have seen a really big improvement in the rate at which cases are being cleared,'' says Wendy D. White, director of the Board on International Scientific Organizations at the National Academy of Sciences.
No such improvement has come in another area of contention -- stem cell research. Scientists charge that the Administration is stifling work that holds the promise of treating a host of diseases. The White House has prohibited federally funded scientists from freely experimenting with all but a small selection of embryonic stem cells because of opposition from anti-abortion advocates. ``In the U.S., you have this absolutely ridiculous position on federal funding. Most of the best researchers [in publicly funded labs] can't touch these cells while private companies can do anything,'' says Austin Smith, director of Edinburgh University's Institute for Stem Cell Research. But that could change. California voters will soon decide whether to sell billions of dollars in bonds to support research in stem cells.
The fears about inadequate research support and slowing immigration are real. But do they strike at the heart of America's technological might, or are they just niggling worries, overshadowed by an innovation engine that still holds awesome power? The complete answer won't be known for years -- and, of course, will depend on everything from future R&D funding to visa policies. But if past history is any guide, it's unlikely that the U.S. is facing any serious threats to its ability to compete in the world.

Nanotech patent wars?

A recent article by Charles Choi detailed a fear that the threat of patent infringement litigation might be deterring innovation in the area of nanotechnology. This theme is not dissimilar from arguments that the threat of patent infringement litigation is deterring innovation in the software field. Furthermore, it is not dissimilar from even earlier claims that the uncertainty in ownership of patent rights over buckyballs was deterring research in C60.

I strongly questioned the claims about patent uncertainty over buckminsterfullerene in an article in Intellectual Property Today. Further, the comments in the Choi article about "lack of diligence" and "flood of patents" don't fit the basic buckyball patent fact pattern, because the basic buckyball patent did NOT ISSUE in the United States. Additionally, the comments about "flood of patents" do bring up the Quillen/Webster/Harvard Law Review "97% grant rate" saga, which hopefully should be put to bed by now.

It is absolutely correct that people should investigate all the fullerene (or quantum dot, etc.) patents out there and formulate business strategy accordingly. If you have a patent lawyer who understands what's going on, you will probably do well. If not, hope you like rolling dice.

from UPI article by Charles Choi:

In talks over the past three months with more than 100 companies, Matthew Nordan, vice president of research for nanotechnology analyst firm Lux Research in New York said he has found a massive dogfight brewing over patents. "The lawsuits could fly like arrows," he said. "In the nightmare scenario, that could stall development for a very long time."

At the root of the problem is patent infringement.

"I'm hearing from (chief executive officers), 'I know of four or five companies infringing on my patents,'" Nordan said. "A number of nanotechnology companies have acquired every patent they can find around a specific nanomaterial, like a quantum dot or carbon nanotube. They growl a lot about their intellectual property position."

"Personally, I think the U.S. Patent and Trademark Office is completely overwhelmed, and a lot of patents make it through without the diligence they used to get," Clint Ballinger, CEO of Evident Technologies in Troy, N.Y., told UPI. "They got a flood of patents in the mid '90s to now, so it's interesting to everybody how many of these patents are really enforceable."

Howard Barnett, CEO of Southwest Nanotechnology, a carbon nanotube company in Norman, Okla., agreed with Nordan, saying it was "absolutely, unequivocally" likely these patent battles were going to happen.

"Nobody's making any money right now, so there's no particular reason to fight the battles yet," Barnett explained. "But a lot of people are coming out with patents, and a lot of claims are certainly overlapping, if not certainly conflicting. The fights are going to be brutal."

"Companies are waiting until somebody hits the $3 million or $4 million sales mark to sue the hell out of them and try to shut them down," Nordan added.

The most likely battles will take place over carbon nanotubes or quantum dots, he said.


The following was of interest.

-->"Let's say you have Lancome or L'Oreal interested in using fullerenes as anti-oxidants -- a huge application for them, as they are far more anti-oxidant than vitamins at smaller volumes. But they will not want to touch fullerenes if they're afraid they'll be at the receiving end of a lawsuit," Nordan said.<--

Recall that recent research has shown buckminsterfullerene (C60) is cytotoxic at 20 parts per billion. It will be a while before you will find it in your cosmetic, and longer still before you find it in a vitamin.

For example, from Health Insurance Week (October 24, 2004):

-->The researchers postulate that cell death in the tests occurred via physical disruption of the cell membrane by oxygen radical species generated by the buckyballs.
Colvin and her colleagues emphasized that the study only fills in part of the puzzle regarding fullerene toxicity. For example, because cytotoxic studies look only at cells in culture, they don't tell scientists what happens inside the body, where cellular repair mechanisms, whole-organ and whole-body processes come into play.
"Cytotoxicity should not be confused with a full-fledged toxicological risk assessment," said Kevin Ausman, CBEN executive director and a coauthor of the paper. "Risk assessments take into account exposure rates, uptake mechanisms, transport within the body and much more. Most often, cytotoxicity studies are used as indicators of whether more extensive toxicological study is needed. Based on our results we think buckyballs should be studied in more detail, and we're already working to arrange additional studies."<--

Polycom drops counterclaims in Avistar case

As noted in previous posts, there are examples of cases wherein a patentee brings an infringement suit, but ends up losing not only the infringement suit but also loses on counterclaims.

In Avistar v. Polycom, the counterclaims were dropped but the original suit remains.

from businesswire:

REDWOOD SHORES, Calif.--(BUSINESS WIRE)--Oct. 26, 2004--Avistar Communications Corporation, a provider of business video collaboration solutions, and Collaboration Properties, Inc. (CPI), its wholly owned subsidiary, today announced that they have reached agreement with Polycom, Inc. wherein Polycom agrees to drop its counterclaim lawsuit against Avistar regarding infringement of U.S. Patent No. 5,767,897. CPI's original infringement lawsuit against Polycom on four Collaboration Properties patents continues. A trial date is currently set for January 24, 2005.

In the original patent lawsuit, CPI alleged that several Polycom videoconferencing products infringe four of its patents: U.S. Patent No. 5,867,654; No. 5,896,500; No. 6,212,547; and No. 6,343,314. The suit was filed in the U.S. District Court for the Northern District of California by the law firm of Simpson Thacher & Bartlett LLP on September 23, 2002. In a response to this lawsuit, Polycom brought countersuit against Avistar on four patents, three of which were previously dropped. This agreement drops the last of the four.

Monday, October 25, 2004

CAFC case on declaratory judgments: Capo v. Dioptics

The factual background of the case depicts a frequent theme in patent law. A patent holder (here, Dioptics) becomes aware that an entity (here, Capo) may be infringing claims of its patents. The patent holder brings up the issue to the possibly infringing entity ("competitor"). The intensity of the dialog escalates. The patent holder talks about patent litigation. At some point, the competitor, fearing that the threats of patent litigation are real and business-threatening, files a declaratory judgment action in federal district court to resolve the issue once and for all. That is, the competitor (here, Capo) files suit in court to obtain a determination that its commercial products do not infringe the claims of the patentee (here, Dioptics). In this particular case, the district court dismissed the declaratory judgment action, but the Court of Appeals for the Federal Circuit determined that the district court was wrong, and that the competitor (Capo) did have a right to obtain a determination of whether or not its products infringed the claims of the patent of Dioptics. Successful declaratory judgment filings give the competitor some advantages, as the competitor gets to make the initial choice of where the action will be (venue) and when it will commence.

In Capo v. Dioptics, the Federal Circuit reviewed (under the abuse of discretion standard, Wilton v. Seven Falls, 515 US 277 (1995)) a district court's decision dismissing a declaratory judgment [DJ] action, and vacated the dismissal. Text within the case gives guidance to patent holders on "what not to do" when seeking to license patents to competitors.

The Federal Circuit cited several cases on DJ actions, including Webb v. Southern, 742 F.2d 1388 (CAFC 1984), Indium v. Semi-Alloys, 781 F.2d 879 (CAFC 1985), and Arrowhead v. Ecolochem, 846 F.2d 741 (CAFC 1988). The Federal Circuit noted that there must be well-founded reasons for declining to entertain a DJ action. Public Affairs v. Rickover, 369 US 111 (1962). On the facts presented in the Capo case, the Federal Circuit did find an abuse of discretion in dismissing the DJ action. [Minnesota Mining v. Norton, 929 F2d 670 (CAFC 1991).]

The Federal Circuit found significant that the patent holder's threats were aimed not a negotiation, but at impeding a competitor's commercial activity. The Federal Circuit also observed that the competitor is not required to verify the extent to which the patent holder has studied the competitor's accused product before the competitor starts a DJ action. That the patent holder declined to file an infringement action (here, based on lack of knowledge of the competitor's product) does not mean that the competitor does not have a reasonable apprehension of suit. To determine whether a DJ action is appropriate, one takes an objective measure of the patentee's words and actions. [citing to BP Chemicals, 4 F.3d at 939; Arrowhead, 846 F.2d at 736.]

Within the decision, the Federal Circuit cited Learned Hand's remark about certain patents functioning as "scarecrows." Bresnick v. U.S. Vitamin, 139 F.2d 239 (CA2 1943). [At some other time, I believe Judge Hand referred to bad patents as derelict ships.]

As a minor point, I note that the disagreement between the two companies started in September 2002 when the presidents of both companies met at a Wal-Mart suppliers meeting. Dioptics is a maker of sunglasses and Capo was buying from Dioptics but decided to become a maker. Of relevance to Knorr-Bremse, the competitor Capo engaged patent counsel to design around the Dioptics product and to furnish a noninfringement opinion. [Note that this behavior is contrary to that discussed by Mark Lemley in "rational ignorance."] The president of the patentee Dioptics cautioned the competitor Capo about "charging down a path here that's going to end up into a multi-million dollar law suit." The president also mentioned not having any choice but to defend the patents against infringement.

Background on Phillips v. AWH, 376 F.3d 1382 (CAFC 2004)

The Phillips case, currently pending before the Federal Circuit, is recognized as a significant case for the future of patent litigation. The Phillips case, once decided, will give some guidance on how the meaing of terms in patent claims will be determined. For example, the first question to be decided is:

Is the public notice function of patent claims better served by referencing primarily to technical and general purpose dictionaries and similar sources to interpret a claim term or by looking primarily to the patentee's use of the term in the specification? If both sources are to be consulted, in what order?

HOWEVER, one judge is skeptical that the Phillips case will yield a final resolution. In dissent, Chief Judge Mayer wrote:

Until the court is willing to reconsider its holdings in Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed. Cir. 1995) (en banc), aff'd on other grounds, 517 U.S. 370, 134 L. Ed. 2d 577, 116 S. Ct. 1384 (1996), and Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448 (Fed. Cir. 1998) (en banc), that claim construction is a pure question of law subject to de novo review in this court, any attempt to refine the process is futile. Nearly a decade of confusion has resulted from the fiction that claim construction is [**7] a matter of law, when it is obvious that it depends on underlying factual determinations which, like all factual questions if disputed, are the province of the trial court, reviewable on appeal for clear error. To pretend otherwise inspires cynicism. Therefore, and because I am convinced that shuffling our current precedent merely continues a charade, I dissent from the en banc order.
[376 F3d at 1384]

With the legal significance in mind, it is useful to contemplate some of the underlying details of what this case is about.

from Daily Camera, October 24, 2004, on the case Phillips v. AWH, 376 F.3d 1382 (CAFC 2004), 2004 US App LEXIS 15065, now pending before an en banc Federal Circuit:

-->The squabble in question dates back to the 1990s.

Phillips, who lives near Estes Park, says AWH infringed on a patent he holds for steel-plate panels used in prison cells after his contract work expired with the company.

The sheet metal products maker sold its own panels to seven prison projects in a six-year span after the contract with Phillips. It then exited that business, citing economic concerns.

Phillips' patent details the use of steel baffles inside his panels. The panels are sturdy, diminish noise, resist fire and deflect projectiles, such as bullets, the patent says.

Phillips says the baffles allow all of those things to happen.

AWH says the patent only suggests the baffles, by connecting to form an intermediate barrier inside the panels, help deflect projectiles. AWH says it only used steel studs inside its panels as a strengthening mechanism, not for deflection.

Phillips hired Boulder attorney Carl Manthei and filed a lawsuit in district court in 1997 seeking damages. AWH hired Mark Fischer, a lawyer with Boulder-based Chrisman, Bynum & Johnson, which has since merged with Faegre & Benson.

Both the trial court and the appeals court favored AWH, although each used slightly different reasons. But the crux of the decisions centered on how terms are defined in the patent.

Manthei says his client's patent uses the word baffle to generally describe all of the features performed by the panel, and a dictionary definition suggests as much.

The Webster's New World Dictionary explains a baffle "as to interfere with; hinder; impede .... an obstructing device, as a wall or screen to hold back or turn aside the flow of liquids, gases."

"Our position is that baffle means what the dictionary says it means," he says.

The trial court, though, said Phillips' panels, as described in his patent, use the baffles specifically for deflection.

The three-judge appeals court favored AWH in a 2-1 decision, the one dissenter saying a dictionary should be used.

****20 to 50%?

Appeals courts often disagree with the way trial courts define terms in patents, an expensive source of frustration for plaintiffs and defendants.

The ABA's Dunner says the problem is significant, adding various observers estimate the issue arises anywhere from 20 percent to 50 percent of the time. <--


Edward H. Phillips has several patents in the area of baffles.

-->US 4,928,468, Filed: December 5, 1988

first claim:
1. A generally rectangular building panel module for defining at least a portion of a building wall, floor, or ceiling when a plurality of modules are assembled, the module comprising:

(a) at least three rectangular metallic plates arranged in parallel to define a hollow, generally rectangular panel module having a pair of spaced, substantially parallel outer faces, at least one of the plates including inwardly extending legs and being symmetrical relative to a longitudinal centerline, at least two of the plates including at least one inwardly extending leg that is joined to an inwardly extending leg of an adjacent plate on the same face of the module to define a longitudinally extending I-beam element having a central web member and a pair of spaced, substantially parallel transverse end members extending outwardly from longitudinally extending edges of the central web member, the end members including an outer end member defining a part of a panel module outer face and an inner end member spaced inwardly from each of the panel module faces, the inner end members each defining first baffle members positioned within the interior of the panel module, the I-beam element providing longitudinal stiffness to the panel module to withstand longitudinally applied compression loads and to provide transverse strength to the panel module to withstand tranversely applied bending loads;

(b) a discontinuous intermediate inner wall positioned between the outer faces, the inner wall defined by respective ones of the first baffle members and by transversely offset second baffle members carried by at least one end leg of each of the plates plates, the first and second baffle members being substantially planar and positioned relative to each other in overlapping relationship and spaced from each other in a transverse direction of the module to prevent direct transmission therebetween of heat and sound and to prevent unimpeded passage through the module of ballistic projectiles that penetrate one face of the module, and thereby provide resistance to passage through the module of ballistic projectiles heat, and sound; and

(c) end cap means extending across respective longitudinally spaced ends of the panel module for interconnecting respective ones of the plates to provide a unitary panel module that can be handled and transported as a unit for assembly with correspondingly-shaped panel modules for defining a portion of a structural, load bearing building surface.

[no claim of priority to other applications. Subsequently cited by four US patents, including 5,228,257]

-->US 4,731,964 This is a continuation-in-part of copending application Ser. No. 852,021, filed Apr. 14, 1986 now U.S. Pat. No. 4,677,798.

first claim:
. A building panel element for forming a part of a building wall surface, said element comprising;

(a) a generally rectangular metallic wall member having an inner wall surface and an outer wall surface, said wall member having a predetermined height and width and including longitudinally extending edges and laterally extending edges;

(b) a pair of laterally spaced baffle members each extending inwardly from respective ones of said longitudinal edges, at least one of said baffle members defining an acute angle with said inner wall surface; and

(c) end flanges carried along longitudinally extending innermost edges of each of said baffle members and extending inwardly toward the inner wall surface of the panel element.

--> US 4,677,798 Filed: April 14, 1986

first claim:

1. Building modules adapted to fit together for construction of fire, sound and impact resistant security barriers and rooms for use in securing records and persons, comprising in combination, an outer shell of substantially parallelepiped shaped with two outer steel plate panel sections of greater surface area serving as inner and outer walls for a structure when a plurality of the modules are fitted together, sealant means spacing the two panel sections from steel to steel contact with each other by a thermal-acoustical barrier material, and further means disposed inside the shell for increasing its load bearing capacity comprising internal steel baffles extending inwardly from the steel shell walls.

[no claim of priority to earlier applications. Subsequently cited by four US patents, including US 5,228,257.]

Spyware epidemic?

Do computer users have a reasonable expectation of privacy against programs implanted on their own computer which transmit data from their computer?


80% of infected PC users unaware – study


A study of home PCs released October 25 found that about 80% had been infected with spyware unbeknown to their users, reports.

The study of 329 home PCs was funded by America Online (AOL) and the US National Cyber Security Alliance. According to AOL chief trust officer Tatiana Gau, users were mostly unprotected from online threats and largely ignorant to the dangers.

"No consumer would walk down the street waving a stack of cash or leave their wallet sitting in a public place, but far too many are doing the exact same thing online. Without basic protections like anti-virus (AV) and firewall software, consumers are leaving their personal and financial information at risk."

Among the other alarming discoveries, nearly three in five users do not know the difference between a firewall and AV software, and two-thirds of users do not have a firewall installed on their computer.

While 85% of PC owners had installed AV software, two-thirds had not updated the software in the last week, and only 20% of users had an active anti-virus on their machines.

Sunday, October 24, 2004

Inherent anticipation. Patent Law day at Michigan State.

A blog ( carries a discussion of "Patent Law Day" at Michigan State University. I don't see too much other discussion of this event (held on Sept. 13, 2004) but do see a notice about that the inaugural issue of the Michigan State Intellectual Property Review contains selected presentations from this conference.

One item of the blog that caught my eye concerned inherent anticipation:

Benjamin Hsing, of Kaye Scholer, discussed inherent anticipation. It is very hard to invalidate a patent by anticipation. Previously, there was a split in case law regarding the standard for anticipation. Both lines of cases said the limitation must be “necessarily present” in the prior art. However, one line of case also required that the limitation be “recognized by a person skilled in the art.” The Shilling case resolved the split, and recognition is not part of the test.
Suppose that a patent covers a drug that produces result Y. Say, drug causes reaction X before producing effect Y. Nobody recognized reaction X. Can you patent a drug that causes reaction X? Or, is it anticipated? The court says: recognition is not part of the test. However, recognition is proof of inherent anticipation. Intent is also important. If you use the patented drug to produce result Z, it does not infringe on the patent.

The case in question is not the "Schilling" case but is Schering v. Geneva concerning Claritin (loratadine) and an attempt in US Patent 4,659,716 to obtain protection to a metabolite of loratidine, desloratadine (DCL) (marketed as Clarinex). The Federal Circuit recited the general rule on inherent anticipation that a prior art reference may anticipate without disclosing a feature of the claimed invention if that missing characteristic is necessarily present, or inherent, in that reference.

It is not clear that there was a split of authority on the point that the limitation be “recognized by a person skilled in the art.” The real issue may have been WHEN the limitation had to be recognized, and Schering makes clear that the limitation did not have to be recognized at the time of filing of the application (here, for the '716 patent). The patent opponent still needs to show that the limitation was inherent at the time of the filing and that this limitation is known to one of ordinary skill at the time of the litigation. [someone had to show that desloratine IS an inevitable product of the metabolism of loratadine]

I had written in Endnote 12 of "There's Always Something There to Remind You," Intellectual Property Today, May 2003:

Note In re Seaborg, 328 F.2d 996 (CCPA 1964). Applicant argued that a small amount of an unknown, unconcentrated isotope would have been undetectable, and the CCPA concurred. However, what result if a new analytical method were subsequently developed which made that small amount detectable? Contemplate text from L. B. Ebert, “Inherent difficulties,” Int. Prop. Today, Nov. 1999: To illustrate one issue in the interpretation of Continental Can, consider the discovery of buckyballs. In 1984, workers at Exxon disclosed the existence of C60, with the formula as determined by mass spectrometric measurement n6 and a way to make said C60. (J. Chem. Phys., 1984, 81, 3322). They did not disclose the correct structure of C60; Professors Smalley and Kroto proposed the structure of C60 to be that of a truncated icosahedron in 1985. This was not known to be correct until after the work of Huffman and Kratschmer in 1990. Now, assuming that the synthesis of Exxon always led to C60 with the icosahedral structure, would a patent claim to C60 in 1990 (with the truncated icosahedral structure) be inherently anticipated by the Exxon work in 1984, even though no one knew the structure in 1984, and in fact could not have proved the structure until 1990? Assuming that one of ordinary skill would recognize the inherent property, albeit at a later date, one might think there would be inherent anticipation. (Of course, a 1990 claim to merely C60 would be explicitly anticipated by the written description and enablement of the 1984 reference.)

From a commercial standpoint, the "big deal" about the Schering case concerned whether or not metabolites could be patented. The Federal Circuit noted generally that this conclusion regarding inherent anticipation does not preclude all patent protection for metabolites of known drugs. However, such metabolites [prodrugs] must be claimed in a way that is both new and non-obvious. Bare compound claims that include within their scope the recited compounds as chemical species in any surroundings, including within the human body, may not be novel under 35 USC 102, even if they have not been recognized. As Schering holds, these broad compound claims are inherently anticipated by a prior art disclosure of a process that causes a drug to metabolize into the claimed compound.

***Also of note

-->Sharon Barner, of Foley & Lardner, considered recent decisions related to the patent disclosure requirements. The Festo decision has created an increase of litigation over the description requirement of section 112.<--

I wasn't sure that the Festo decision, as opposed to perhaps Eli Lilly or Enzo or University of Rochester, was responsible for most 112 "written description" issues.


The Hon. Cohn, Senior District Judge, United States District Court, for the Eastern District of Michigan, began by listing some challenges in American patent litigation. The complexity of patent suits tests the patience and capacity of a District Court judge (this was a joke, but it makes a point). In patent cases, there is a 33% reversal rate on appeal, and very complicated decisions are often committed to unsophisticated jury (or judge). There is a very high degree of uncertainty about outcome of patent suit. However, most action in patent cases is in the pre-trial, because most cases settle. Trials are becoming uncommon in the American legal system, especially for patent cases. <--

COMMENT: At one point, it seemed that legal academics pegged the reversal rate above 33%. A number of 33% has been mentioned for reversal SPECIFICALLY on claim construction issues.

In the April 2002 issue of Intellectual Property Today , Endnote 11 of "Deciding Cases the Old Fashioned Way", recites

--IP Worldwide, p. 30 (March 2002), citing to Kimberly Moore for a true rate of reversal of about 50% (Harvard's Journal of Law and Technology) and to Christian Chu for a rate of 47.3% (Berkeley Technology Law Journal). Also, Cybor Corp. v. FAS Technologies, Inc., 138 F.3d 1441, 1473 (Rader concurring)--

In the November 2002 Bulletin of the IP section of the ABA, Mark Banner reported of Moore's 2001 article: The article reviewed in exhaustive detail the holdings of the Federal Circuit on claim construction issues. It concluded that there was a 33% reversal rate on claim construction issues, and that where district courts were reversed on claim construction, the Federal Circuit either reversed or remanded the decision 81% of the time. Implicit in the analysis was the conclusion that such a reversal rate was too high for the legal and business community to have confidence in the predictability of outcome in patent infringement cases. [“Are District Court Judges Equipped to Resolve Patent Cases?”, 15 Harv. J. L. & Tech. 1 (2001), republished in 12 Fed. Cir. Bar. Journal 1 (2002).]

from footnote 194 of Glynn S. Lunney, Jr, Patent Law, the Federal Circuit, and the Supreme Court: A Quiet Revolution, 11 S. Ct. Econ. Rev. 1 (2004):

Both Christian Chu and Kimberly Moore have documented the high reversal rates involving claim construction. See Christian A. Chu, Empirical Analysis of the Federal Circuit's Claim Construction Trends, 16 Berkeley Tech LJ 1075, 1097-1100 (2001) (noting that despite the changes to the infringement inquiry, "the promises of pre-trial predictability and expedient patent litigation seem to remain a tantalizing dream"); Moore, 15 Harv J L & Tech at 14 (cited in note 192) ("This means that more than one in four appealed patent cases involving claim construction result in overturning the judgment reached by the district court solely for claim construction reasons.").

from footnote 26 of article by Rai, 17 Berkeley Tech. L.J. 877 (2002):

See Christian Chu, Empirical Analysis of the Federal Circuit's Claim Construction Trends, 16 Berkeley Tech. L.J. 1075, 1104 (2001) (giving figure of 44%); Kimberly A. Moore, Are District Court Judges Equipped to Resolve Patent Cases?, 15 Harv. J.L. Tech. 1, 11 (2001) (giving figure of 33%). The discrepancy between the Moore and Chu findings likely emerges from two factors. First, while Moore's study encompasses cases decided between April 1996 and December 2000, Chu's study encompasses cases decided between January 1998 and April 2000. In addition, while Moore's includes within her population of cases Rule 36 summary affirmances, Chu excludes these affirmances. Chu's study also draws interesting conclusions regarding the Federal Circuit's review of patent cases more generally. He determines that, excluding summary affirmances, the overall reversal rate was 47.3%. Id. at 1098. Including summary affirmances, the overall reversal rate was 36.6%. Id. at 1100.

Also, from article by Judge Holderman, 2002 U. Ill. J.L. Tech. & Pol'y 425:

Nationwide, there are about 2,500 patent infringement cases filed in the U.S. District Courts each year. In fact, in the year 2000, there were exactly 2,484 filed, n25 and in 2001, there were 2,520 filed. n26 However, there are over 300,000 other types of cases, both civil and criminal, filed each year. In fact, the nationwide number of total district court filings in 2000 was 322,262 n27 and in 2001 was 313,615. n28 Patent cases are less than 1% of the nationwide caseload of our district judges.


-->Also, Judge Cohn pointed out that two books were recently published about reforming our patent system (Patents in the knowledge based economy & Patent system for the 21’st century). It is suggested that we also look at other studies commissioned by the FTC in 1936, 1943, 1966, 1992. Looking at these 5 reports might suggest the progress we have made in the past century.

Finally, Judge Cohn looked at four of the recommendations made in the books.

1. Post grant review procedure of opposition – suggests this could run into problems due to the 7th amendment right to jury trial.
2. Validity should have a Preponderance of Evidence Standard – This will probably be accomplished by an upcoming Federal Circuit decision.
3. The legal standards for obviousness should be tightened. – This will probably be accomplished by upcoming Federal Circuit decisions.
4. Redefine willfulness to be just actual written notice, or obvious copying. – This probably requires legislation, but will shorten the length of patent trials.

A final practice point: Judge Cohn does not like attorneys trying to hustle the judiciary with fancy PowerPoint presentations.
Of 1., I don't believe I've heard that objection before. If the opposition is part of the PTO administrative process, what jury right attaches?
Of 2., what upcoming Federal Circuit decision will change the evidence standard? Same query for 3.
Of 4., Knorr-Bremse has altered presumptions about willfulness.

Maria C.H. Lin, spoke about China’s patent system. To put China into context, one must remember that China is a socialist state, China had no patent laws just 25 years ago, and China only joined the WTO in 2001. China is different from US patent law in some major ways. For example, there is a 2 year statute of limitations for patent damages. Also, there is a defense of innocent infringement in China. Finally, the feared compulsory licensing provision exists, but has never been used.
The Chinese translation of English patents is controlling, which can cause problems. Chinese patents use Jepson claim format. U.S. practitioners must remember to deposit microorganisms on the filing date to receive a patent in China. China also provides “utility model” patents which are filed without examination and a source of possible danger. The legal profession is still being privatized, and the Chinese culture has some conflicts with patent ownership. Finally, China is influenced by the U.S. Federal Court of Appeals (which can be seen as good or bad).<--

Saturday, October 23, 2004

Pharma article by Malcolm Gladwell

In discussing Angell's book “The Truth About the Drug Companies: How They Deceive Us and What to Do About It” (Random House; $24.95), Gladwell gives a brief history of Prilosec/Nexium (including a discussion of the enantiomer/racemate relationship) and points out certain issues with the application of COX-2 inhibitors (see also "Increasingly Aggressive Efforts at Patent Enforcement," Intellectual Property Today, (June 2000)). He brings up the possibility that PBMs might alleviate some of the inefficient utilizations of drugs (eg, use of higher cost drugs where the incremental cost is not commensurate with the incremental benefit).

This is why increasing numbers of employers have in recent years made use of what are known as Pharmacy Benefit Managers, or P.B.M.s. The P.B.M.s draw up drug formularies—lists of preferred medications. They analyze clinical-trials data to find out which drugs are the most cost-effective. In a category in which there are many equivalent options, they bargain with drug firms, offering to deliver all their business to one company in exchange for a discount. They build incentives into prescription-drug plans to encourage intelligent patient behavior. If someone wants to take a brand-name oral contraceptive and there is a generic equivalent available, for example, a P.B.M. might require her to pay the price difference. In the case of something like heartburn, the P.B.M. might require patients to follow what’s called step therapy—to try the cheaper H2 antagonists first, and only if that fails to move to a proton-pump inhibitor like omeprazole. Employers who used two or more of these strategies last year saw a decrease of almost five per cent in their pharmacy spending.

There is no mention of these successes in “The Truth About the Drug Companies.” Though much of the book is concerned with the problem of such costs, P.B.M.s, the principal tool that private health-care plans use to control rising drug costs, are dismissed in a few paragraphs. Angell’s focus, instead, is on the behavior of the pharmaceutical industry. An entire chapter, for instance, centers on the fact that the majority of drugs produced by the pharmaceutical industry are either minor variations or duplicates of drugs already on the market. Merck pioneered the statin category with Mevacor. Now we have Pfizer’s Lipitor, Bristol-Myers Squibb’s Pravachol, Novartis’s Lescol, AstraZeneca’s Crestor, and Merck’s second entrant, Zocor—all of which do pretty much the same thing. Angell thinks that these “me-too” drugs are a waste of time and money, and that the industry should devote its resources to the development of truly innovative drugs instead. In one sense, she’s right: we need a cure for Alzheimer’s much more than we need a fourth or fifth statin. Yet me-too drugs are what drive prices down. The presence of more than one drug in a given category gives P.B.M.s their leverage when it comes time to bargain with pharmaceutical companies.<--

Another topic covered by Gladwell relates to misinformation:

-->Here is a classic case of the kind of thing that bedevils the American health system—dubious findings that, without careful evaluation, have the potential to drive up costs. But whose fault is it? It’s hard to blame Pravachol’s manufacturer, Bristol-Myers Squibb. The study’s principal objective was to look at Pravachol’s effectiveness in fighting heart attacks; the company was simply using that patient population to make a secondary observation about strokes. In any case, Bristol-Myers didn’t write up the results. A group of cardiologists from New Zealand and Australia did, and they hardly tried to hide Pravachol’s shortcomings in women and older people. All those data are presented in a large chart on the study’s third page. What’s wrong is the context in which the study’s findings are presented. The abstract at the beginning ought to have been rewritten. The conclusion needs a much clearer explanation of how the findings add to our understanding of stroke prevention. There is no accompanying commentary that points out the extreme cost-ineffectiveness of Pravachol as a stroke medication—and all those are faults of the medical journal’s editorial staff. In the end, the fight to keep drug spending under control is principally a matter of information, of proper communication among everyone who prescribes and pays for and ultimately uses drugs about what works and what doesn’t, and what makes economic sense and what doesn’t—and medical journals play a critical role in this process.


A more significant critique of medical journals is the writing of drug reviews by authors with some conflict of interest in the drug being reviewed. Angell, in her previous role as editor at NEJM, was involved in a problem of this kind.

As to Gladwell's issue of "clearer explanation," one might also take a look at the way law reviews are being handled. For example, as noted elsewhere on this blog, the Harvard Law Review published an article asserting a 97% patent grant rate at the USPTO, even though there is no such thing, and never corrected the error. At a minimum, that article needed a "clearer explanation."

**UPDATE. 2 Sept 2005**

Several pieces of legislation, enacted from the Reagan era onwards, have played into the hands of Big Pharma - the collective name for the top 10 drug companies that between them netted $US36 billion in profits in 2002 - more than all the other 490 Fortune 500 companies together.

It sounds like high farce but it is fact: the US Patent and Trademark Office is paid a piece rate according to how many applications it processes, which, naturally, predisposes it to grant patents rather than having to justify rejecting them. Bingo: patents on new dosages, combinations of old drugs, and even on the coatings and colours of pills.

Pity the drug regulator as it wades through the resulting patent mountain to figure out which of these supposed innovations should earn the companies an extension on their lucrative exclusive marketing rights.

Of course, the pharmaceutical industry and free-market pundits decried Angell and her work when the book was published in the US last year.

She was lampooned as a woolly leftie by James Pinkerton, a fellow of the think tank New America Foundation.

"She argues that the same government that has given us the Interstate Commerce Commission, the Federal Communications Commission, the Federal Energy Regulation Commission, the Federal Elections Commission, and a hundred other acronymic agencies, will do a wonderful job of overseeing the pharmaceutical industry," he sniggered. "So if you are sick and tired of capitalism, your ship may be coming in."

Henry Miller, a fellow at the conservative Hoover Institution at Stanford University, got more personal, accusing Angell of a crusade to deny people life-saving innovations. "Dr Angell's analysis of companies' profitability downplays their huge investments in research and development," he wrote. This investment, as a proportion of sales, was about four times as much as the electronics, telecommunications or aerospace sectors.

Nanotech applications

In a basic application, NanoTex Co. has created nanoparticles that attach to cotton fibers and create a barrier that causes liquids and other substances to bead up rather than be absorbed by the cotton. The process is used by many clothing manufacturers, including Gap and Old Navy. The company has developed a coating that will help clothes absorb and neutralize body odors, giving clothes a fresh smell through repeat wearings.

Other products utilizing nanotechnology include:

Sunscreen: The use of microscopic metal oxide particles produces a clear sun-blocking lotion without the “white smear” caused by older technologies.
Cosmetics: L'Oreal, Esteé Lauder and other companies are making skin creams and other products with nanoparticles that penetrate deep into the skin, allowing more effective and longer-lasting delivery of vitamins and other agents.
Paints and coatings: Nanoparticles better protect surfaces from decay, scratches and corrosion, and window coatings reduce glare or provide greater insulation. Inframat, a firm in Farmington, Conn., says its nanotech ceramic coating prevents barnacles from adhering to ship hulls.
Silver antibacterials. [Nano-sized metals, such as gold, behave quite differently than larger sized particles. for example, “Responsible Development of Nanotechnology,” April 2, 2004, available at html/about/TeagueRegNNIConf04.html.]

Quantum dots are used in bio applications because they are small enough to pass through the leaky blood vessels found near cancerous cells and lodge near them. Shuming Nie has further boosted their detection skills by attaching cancer-finding antibodies to them. “Nanoprobes Are Destined for Major New Roles in Medicine,” Drug Week, March 19, 2004, p. 173.

Also: “2003 Nanotech Product Guide,” Nanotech Report, July 2003, p. 1. For a list of early patents in the fullerene area, see LB Ebert, Carbon, 1995, 33, 1010.

**The article by Barnaby J. Feder on nanotech is repeated at

As one point on the patent issue, note that buckyballs were probably synthesized in the 1960's by a group in the United States. Using a technique which we now know would make buckys, they reported an x-ray diffraction pattern distinct from graphite. Under the law set out in the Schering case, we know that for buckyballs to be anticipated by this work, it is not relevant that the workers in the 1960's did not understand that they had made a new form of carbon; it only matters that they did make a new form, which can be proved by experiments done at a later time, like 2004.

Friday, October 22, 2004

Ampex files patent suit against Kodak over digital cameras

To illustrate that patent law is not always the "big guy" suing the "little guy," note that Ampex has filed suit, both at the ITC and in the District of Delaware, against Kodak over digital cameras. Kodak recently was the plaintiff against Sun in a patent suit involving Java issues, and much earlier was the defendant in a suit brought by Polaroid.

-->Ampex Corp. (Redwood City, Calif.) filed a complaint with the International Trade Commission seeking to exclude Eastman Kodak Co. from selling digital cameras in the U.S., alleging the imaging products supplier infringed on its IP.

In addition, Ampex filed suit in the United States District Court for the District of Delaware seeking unspecified damages from Kodak for patent infringement. <--

Magma answers, counterclaims in Synopsys patent suit

from Businesswire: Magma Design Automation Inc., a provider of chip design solutions, announced on Oct. 21, 2004 it has filed an answer and counterclaims in United States District Court for the Northern District of California in response to a lawsuit filed by Synopsys Inc. against Magma for allegedly infringing three patents related to electronic design automation ("EDA") technology. In the filing of October 21, 2004, Magma refutes all allegations that it is infringing a Synopsys patent. Magma also affirms its full ownership of two other patents granted to it by the U.S. Patent & Trademark Office, patents to which Synopsys now claims rights.

Key points in the "Preliminary Statement" of Magma's answer to the Synopsys lawsuit (pages 1-4 of the court filing) include:

-- Synopsys' claim that Magma infringes U.S. Patent No. 6,378,114 ('114) is without merit because Magma's technology is fundamentally different from the invention disclosed in that patent. [Note: this is an assertion of noninfringement.]

-- Magma has full ownership of the two other patents at issue, U.S. Patent No. 6,453,446 ('446) and U.S. Patent No. 6,725,438 ('438), because the inventions disclosed in those patents were developed at Magma. Thus, Synopsys has no right to assert these patents.

-- Synopsys has no standing to bring any infringement action under the '114 Patent because IBM is a joint owner of that patent pursuant to a joint development project with Synopsys. Magma, moreover, holds a license to this patent under a license agreement with IBM. [Note: each assignee of a patent does have a right to license complete patent rights in the absence of an agreement to the contrary.]

-- Even if Synopsys could show that the '446 and '438 patents are not owned entirely by Magma, those patents would also be jointly owned with IBM, and thus Synopsys has no standing to sue Magma for infringement. If owned by Synopsys and IBM, these patents would also be licensed to Magma pursuant to Magma's license agreement with IBM.

-- Synopsys is engaging in efforts to spread false and misleading statements about Magma and its products.

In its filing today, Magma seeks, among other things, dismissal with prejudice of Synopsys' complaint, reaffirmation of Magma's ownership interest in the '446 and '438 Patents and an order enjoining Synopsys' unfair business practices.

The filing is available to the public from the U.S. District Court, Northern District of California, San Francisco, Case No. C04-03923.

Thursday, October 21, 2004

Jury verdict against Genetech upheld in City of Hope case

On October 21, 2004, the California Court of Appeal in Los Angeles upheld a jury verdict ordering Genentech Inc. to pay $500 million to the City of Hope National Medical Center (Duarte, CA) to settle a dispute over a 1976 drug royalties contract. The litigation involved commercial rights to Genentech-funded City of Hope research conducted in the late 1970s that yielded a patented method for using bacteria to produce human proteins invented by City of Hope researchers Arthur Riggs and Keiichi Itakura. Overall, there were 100 patents, and the research led to the creation, among other things, of synthetic insulin, or Humulin®, the world's first biotechnology drug. This litigation is not directed to the license that City of Hope has granted to Genentech for use of its monoclonal antibody technology. This technology is used in the manufacture of the medications Herceptin® and Rituxan® two promising anti-cancer drugs.

The history of this case is complex. City of Hope filed the original contract dispute suit against Genentech in 1999. The first trial resulted in a hung jury, 7-5 in Genentech’s favor, in October 2001. In the retrial, the jury deliberated for 17 days before announcing the verdict on June 10, 2002, which directed Genentech to pay approximately $300 million in additional royalties, including royalties on products for which Genentech itself did not receive royalties. The trial continued three days and the jury deliberated an additional three days before announcing the punitive damages award granted to City of Hope.

Of the decision on appeal, the three-member appellate court said there was "substantial evidence of fraud and malice" by Genentech. It also refused to grant the company a new trial. City of Hope had asserted Genentech concealed licensed sales of protein products, such as hepatitis vaccines, over a 15-year period that were worth about $16.7 billion and that it thereby was owed $457 million in royalties and interest.

Fewer than 25,000 genes in the human genome

As the number of human genes drops downward, it becomes apparent that the key technical, and patent, frontier is at the proteome, not the genome.

from The Scientist:

Still, it is the paucity of genes in the human genome—a figure revised downward to fewer than 25,000—that continues to "blow our socks off," according to Francis Collins. It seems like an awfully short list to account for the biological properties of a human being, he said.

Hal Varian in the New York Times on patents

A problem with economists viewing the patent system is their lack of familiarity with the patent system.

--> Superficial anecdotes are used to substitute for thorough analysis. Thus, one might get the idea that the patents on a method of swinging on a swing or on the sealed crustless sandwich are the rule, rather than the exception, at the Patent Office. Amazon's one-click patent is frequently brought up, but the fact that it sustained a validity attack in district court is rarely mentioned. Fictional anecdotes, such as the idea that the inventors of the transistor foresaw applications only for hearing aids, are presented as if they were fact.

--> Concepts such as "regulatory capture" are imported from other fields, where they might make sense, to the patent system, where there is no evidence that they have any relevance. Although some of the judges come from industry, it's hard to detect a pro-industry bias among the judges. Further, in looking at the scattered positions taken by corporations in the two recent cases on the doctrine of equivalents (Hilton Davis; Festo), it's hard to tell "what is" the corporate position on patent issues.

--> Discrete concepts, such as novelty (35 USC 102) and obviousness (35 USC 103), can be garbled. For example, in the much discussed re-examination involving the Eolas patent, the only issue has been one of obviousness, with no contention that the claims of the Eolas patent are anticipated over the prior art.

--> Broad-brush assertions, such as the presence of "a steady reduction in patent quality," are presented without proper documentation. In the Quillen/Webster studies, there is an assertion that "higher grant rates" directly imply a reduction in patent quality, although this has not been documented. Furthermore, the assumptions underlying the Quillen/Webster studies, which are the primary evidence for "higher grant rates," have been questioned.

from the New York Times, October 21:


Published: October 21, 2004

FEELING hungry? How about a peanut butter and jelly sandwich? But be careful how you make it - you don't want to infringe on United States Patent No. 6,004,596, for a "sealed crustless sandwich."

Well, maybe it is safer just to have some toast. But watch out for Patent No. 6,080,436 on a "bread refreshing method."

Not hungry anymore? Well, maybe you could just play with the cat. But even that's not safe. Patent No. 5,443,036, "Method of Exercising a Cat," protects using a laser pointer to amuse a cat "and any other animals with the chase instinct."

These patents, which might strike some as frivolous, are symptoms of the deeper problems with the nation's patent system discussed in "Innovation and Its Discontents," a recent book by two economics professors, Adam B. Jaffe of Brandeis and Josh Lerner of Harvard.

Most economists, including the authors of this work, accept the need for intellectual property protection. Patents provide necessary incentives for innovation by adding "the fuel of interest to the fire of genius," in the words of Abraham Lincoln, the only American president to hold a patent - for a device to lift boats over shoals.

However, any system of intellectual property protection requires balance. The law must offer enough rights to the inventor to stimulate innovation, while at the same time ensuring that the resulting temporary monopoly on the invention does not impose too onerous a burden on society.

A patent has a length, a width and a height: how long it is valid, how broadly it applies and how novel it is. Mr. Jaffe and Mr. Lerner are most concerned with the last issue.

A patentable invention must be "not obvious to one skilled in the art." This guideline is subject to interpretation, and in recent years it has seemed as if almost anything could be patented.

According to the authors, the deterioration in patent quality started in 1982, when Congress made two seemingly innocuous changes to the system.

First, it created a specialized Court of Appeals for the Federal Circuit. The motivation for this change was well intentioned: the district courts that heard patent appeals before 1982 applied widely varying standards, and the new Court of Appeals was supposed to offer a consistent policy.

Second, Congress tried to make the processing of patents self-sustaining: it was to be supported entirely from fees paid by patent applicants.

These reforms resulted in a tilt toward patent holders. Mr. Jaffe and Mr. Lerner assert that since these changes, a patent applicant is "much more likely to have the patent granted; the patent is much more likely to be held valid if challenged in court; and the party accused of violating the patent is more likely to be found to be an infringer and forced to pay a large monetary award."

The economists explain these changes as an example of what economists call regulatory capture. Regulators - in this case, judges who hear patent cases - are often drawn from the industry they regulate. Even in cases where they come in as outsiders, over time they tend to identify with the concerns of the industry they regulate rather than with the public at large.

The Patent and Trademark Office now views its constituency as patent holders - not surprising, given that they make up the group that provides its financing. As one patent examiner put it: "When I first started here, I was told, 'When in doubt, reject' and to try to reject. Now I am told, 'When in doubt, allow' and try to find a reason to allow."

Patent examiners are underpaid and overworked. Novelty is supposed to be judged relative to "prior art," but it is almost impossible for a single human being to root out all relevant prior art. One result has been a steady reduction in patent quality, with patents of dubious novelty being granted routinely.

The reduction in standards for granting patents has started an arms race among patent holders. The best defense against being sued for patent infringement is to hold a portfolio of patents that can be used to countersue. So every company has to build a "patent thicket": an arsenal of patents that can be used offensively or defensively, as necessary

Wednesday, October 20, 2004

DSS loses dualsand trademark case at CAFC

DSS appealed to the Federal Circuit a decision of the TTAB denying registration of the trademark "dualsand" on the ground it was descriptive. DSS argued that "dualsand" was suggestive.


In the final office action of the examination, the examining attorney cited 13 articles from the internet to conclude that "dual sand" was a term of art. DSS submitted third party registrations to substantiate the suggestiveness argument, but these were not considered because DSS did not provide copies of the registrations to make them of record.

Appeal to the TTAB

On appeal, the TTAB sustained the examining attorney. Of the suggestive/descriptive boundary, the TTAB cited In re Quick Copy Shops, 616 F2d 523 (CCPA 1980).

Appeal to the Federal Circuit (CAFC)

In turn, the CAFC affirmed the TTAB decision, finding substantial evidence sustained its decision. The CAFC quickly disposed of the argument of DSS that the internet citations were not credible. A due process argument about the failure to consider the registrations failed, especially because the TTAB had stated it would have reached the same decision even if the registrations had been considered. [HOWEVER, on this particular point, recall the dissent of Judge Newman in a different due process case [Nelson v. Adams], and recall that the dissent of Judge Newman was largely embraced by the US Supreme Court, which obliquely characterized the CAFC majority view of due process as being like Alice in Wonderland. Thus, the better reasoning is that there was due process, not that its absence did not matter. And remember the infringement defendant in Nelson v. Adams, although winning at the Supreme Court, ended up losing when he got his due process, courtesy of collateral estoppel.]

Vocel markets cell phone application to Verizon

from zdnet:

Verizon Wireless is now selling a $5.75-a-month SAT-tutoring service that automatically e-mails questions to cell phones. The subscriber chooses when he or she wants to receive questions, then the service sends flash card type exercises, queries from previous Scholastic Assessment Test exams and other material.

A devilish feature lets a parent check up on how well a teenager is doing with the service, said Carl Washburn, chief executive of Vocel, the San Diego-based wireless software maker that's supplying the application for Verizon Wireless to sell.

Premium games, ring tones and other cell phone software has developed into a billion-dollar-a-year business in the United States, and it's helping carriers adjust to the steadily declining price of phone calls.

Tutoring represents a new generation of more sophisticated applications, and a patent is pending on some of the technology in use, according to Vocel. Other next-generation cell services include downloadable videos and TV.


VOCEL uses QUALCOMM's BREW solution to incorporate its cutting edge SMS "push" technology into this innovative application. The unique part of this technology is that students can choose their test prep schedule. "My 15 year old son is not yet disciplined enough to study for the SAT on his own," said Carl Washburn, CEO of VOCEL. "This technology is a godsend-SAT practice questions are automatically being sent to his phone throughout the day. The
practice questions are impossible to ignore. Now he is answering SAT practice questions each day without my having to nag him to study," said Carl Washburn, CEO of VOCEL.

Tuesday, October 19, 2004

USPTO creates nanotechnology reference guide

from smalltimes:

The U.S. Patent Office has created a cross-reference digest designed to improve the ability to search and examine nanotech-related patents.

The office said in a written release that the digest seeks to guide the search for prior art, serve as a collection of issued U.S. patents and published pre-grant patent applications, and help develop an expanded cross-reference art collection classification schedule. That schedule, ultimately designed to replace the new digest, will include definitions, sub-classes and search notes.

**There's certainly no shortage of published papers on buckminsterfullerene (aka buckyball), fullerenes, and nanotubes. Further, although there have been allegations that uncertainty over patent ownership of fullerene technology has impeded development, it may be more likely that undertainty over viable applications has been the obstacle.

***The patent office's definition for nanotechnology requires that a least one dimension of the item of an invention be less than 100 nanometers, but small size alone is not enough. The nanoscale element of the product or process must be essential to whatever properties make it novel.

"People looking for venture capital money will call anything small 'nanotechnology,' " said Bruce Kisliuk, director of the section of the patent office that handles biotechnology and pharmaceutical applications, who is coordinating the work on nanotechnology issues. [i.e., the call of "nano, nano."]

The decision to set up Class 977, as the new patent class category will be officially designated, is a recognition that a swarm of nanoscale inventions is headed the patent office's way. Some are already on the market, including fibers for clothing and mattresses that are highly stain resistant and water resistant; particles of titanium dioxide that make sunscreen transparent; and nanocrystals of silver for antimicrobial bandages [see earlier post on Hatch-Waxman work out of Penn State].

Monday, October 18, 2004

The Shelby Amendment: the boogey man never came

Back in 1999, the Shelby amendment was controversial. Many scientists and scientific societies predicted doom and gloom. Five years later in 2004, we see that these predictions were way off the mark and probably represented interest-group mindset rather than objective reasoning.

In 1999, Dick Kirschten reported on Rush Holt's position opposing the amendment:

-->Rep. Rush Holt, D-N.J., a physicist, describes the Shelby amendment as an attempt at "back door regulatory reform." He attributes it to a mind-set holding that "if those regulators are doing things to me that I don't like, then it must be bad science." Holt says all research findings should be open to scrutiny not only by the public but by other scientists who can try to replicate or refute them. But, he adds, "that doesn't mean the scientist should be harassed while doing the research." <--

In "Risk-Aversion and Iatrogenic Events: Not All Patent Claims (or Lawyers) Are Created Equal," (Intellectual Property Today, March 2000), I took issue with Holt's view of the Shelby amendment.


On January 10, 2000, Chemical & Engineering News (CEN) published a guest editorial by Congressman Rush Holt (D-NJ), who has a Ph.D. in physics and was formerly assistant director of Princeton University's Plasma Physics Laboratory. Entitled "Repealing a Bad Law," it was directed to the Shelby amendment of the
Freedom of Information Act (FOIA), although it did not refer to the "Shelby amendment" or Senator Richard Shelby by name. There was an aspect of the editorial pertinent to possible effects of the Shelby amendment on intellectual property (IP) rights created under the Bayh-Dole Act, although the Bayh-Dole Act was not named. This IP-relevant text follows.

As a direct result of this law, university-industry partnerships will be adversely affected because FOIA does not adequately protect scientists from proprietary breaches. Data from privately funded research may be conmingled with data from publicly funded research in ways that may be difficult to separate. This will dampen industry's enthusiasm for academic collaboration and significantly hinder scientific progress, particularly in fast-paced high-tech
industries. According to PhRMA [Pharmaceutical Research & Manufacturers of America], this amendment "could result in the release of commercially sensitive data and thereby undermine the incentives for joint public-private cooperative research." It is vital that this productive environment for research not be
hampered by the issues that will result from these new regulations. n12

n12 R. Holt, Chemical & Engineering News, p. 3 (Jan. 10, 2000). Holt presumably considers the Shelby amendment iatrogenic. Also, L. B. Ebert, C&E News, p. 4 (Jan. 31, 2000). Of the possible issue that disclosure under FOIA to third parties might lead to patents to third parties, one wonders if the public is poorly served if data derived from public grant funds create (additional)
inventions not contemplated by the grantee. The buckyball saga illustrates a related point, wherein it was the SECOND group of researchers to knowingly make C60 (the academic Professors Smalley, Kroto and Curl, who corrected the imperfect FIRST results of the industrial workers) who received the Nobel Prize.

On January 12, 2000, I emailed the following letter to CEN.

Of the guest editorial "Repealing A Bad Law" (C&EN, 10-Jan-00),
Congressman/scientist Holt is somewhat lawyer-like in omitting certain details surrounding the Shelby amendment of Public Law 105-277, which gives the public access to data generated by federally-funded grants under procedures established under the Freedom of Information Act ("FOIA"). Cong. Holt says that the "legislation was introduced hastily in backroom discussions without any public
debate" and that "it was concocted in the dark of night," but fails to mention the factors which caused Senator Shelby to act. These omitted aspects include the following. The National Institutes of Health funded the Harvard School of Public Health to research certain clean air/particulate matter issues. The Environmental Protection Agency used these research findings in justifying
regulations pertaining to sources of small particle emissions ("soot"). The regulated community wanted to see the data. The request was denied. The data resided with Harvard and not the EPA, and were thus immune from a FOIA request. Senator Shelby acted to rectify the problem. In doing so, Senator/ lawyer Shelby was in harmony with a 1985 statement of the National Research Council:
"Scientists have a special responsibility to share data as quickly and as widely as possible where the data are or will become relevant to public policy." Cong. Holt identifies four major problems with the Shelby amendment: confidentiality breach, "infringement of intellectual property", opportunity for harassment and administrative burden. Of the intellectual property issue, 35 USC sections 200 -212 (relevant portions of the Bayh-Dole Act) and 37 CFR 401-414 (implementing rules thereof) impose confidentiality restrictions on the agencies as to release under FOIA. Of the non-profit organization itself, the fact that it is the first entity to generate and to possess the data suggests that it is in the best
position to file for patent protection, with or without the Shelby amendment, with or without conmingled data. The availability of provisional applications (35 USC section 111(b)) allows rapid and inexpensive filing to establish protection. Of harassment, would one prefer partisan lobbyists to make ad hominem attacks (the no-FOIA Holt world) or at least to address issues in the
underlying data (the FOIA Shelby world)? In the context of the Dorn controversy (Science, 29-Oct-99, pp. 883, 885), a lawyer was quoted: "Scientific disputes normally get worked out by a riproaring debate in the literature." The debates most useful to society are those with all available facts on the table. The concerns raised by Cong. Holt must be addressed, but omitting the issues of
Sen. Shelby is not a good way to reach dialog and resolution.

On January 20, CEN said my letter would be published. En route to
publication, the key sentence on the intellectual property issue underwent transmogrification. Thus, "Of the non-profit organization itself, the fact that it is the first entity to generate and to possess the data suggests that it is in the best position to file for patent protection, with or without the Shelby amendment, with or without conmingled data" was changed by CEN to become "Of the nonprofit organization itself, (as considered in the Bayh-Dole Act), since it is the first entity to generate and to possess the data, it is in the best position to file for patent protection, with or without the Shelby amendment or commingled data." I requested substitution of "as considered in the Bayh-Dole Act" by -- e.g., a university -- but CEN, without authorization, published the
key sentence as: "Since Harvard is the first entity to generate and possess the data, it is in the best position to file for patent protection -- with or without the Shelby amendment or conmingled data."

Instead of dealing with the nub of the general issue of the Shelby amendment (opening up grantees (e.g., universities) to FOIA) and the general sub-issue (the interplay of the Shelby amendment with the Bayh-Dole Act), CEN made it appear that the specific Harvard/ NIH/EPA episode concerned patent rights, which it did not.

In the debate about the Shelby amendment, there has been some discussion of the amendment effectively (or essentially) overturning a 1980 Supreme Court decision, Forsham v. Harris, 445 U.S. 169 (1980). This is incorrect. In Forsham, the court noted FOIA (5 USC 552) empowers federal courts to order an "agency" to produce "agency records improperly withheld." (Section 552(a) (4)(B)) but that the data at issue were not "agency records." Forsham, 445 US at
177. Post-Shelby, the data in Forsham still are not agency records. FOIA was amended to allow access to grantee's data. n13 However, comparisons of Forsham to Shelby are interesting. In Forsham, the technical data at issue pertained to the correct treatment regimen for diabetes, and the petitioners (whose ideas were adversely affected by a federal regulation) wanted to see the data and statistical methods. Because the data were not agency records, they didn't get to see the data. Justice Rehnquist (a "conservative") wrote the opinion effectively blocking data access and Justices Brennan and Marshall ("liberals") dissented. About twenty years later, Senator Shelby (a "conservative" and a lawyer) is blocked in his efforts to secure data on behalf of people adversely
affected by a federal regulation. n14 He presents his amendment, effectively opening data access, and Congressman Holt (a "liberal" and a scientist) tries to repeal the amendment and to cut back data access.

n13 For a discussion of the contractee/grantee dichotomy, see letter of Gary D. Bass of OMB Watch in the Washington Post, April 20, 1999.

n14 The regulation tightened standards on particulate emission. The author discloses that he worked as a scientist on soot. L. B. Ebert, J. C. Scanlon and C. A. Clausen "Combustion Tube Soot from a Diesel Fuel/Air Mixture: Issues in Structure and Reactivity," Energy & Fuels, 2, 438 (1988). The impact of the Shelby amendment on the collaboration between Exxon (analyzer of soot) and a
university grantee/ contractee (creator of soot) might be interesting to contemplate. Separately, the work showed that soot consists primarily of polynuclear aromatics (a class including potent carcinogens) rather than benevolent buckyballs, theoretically avoiding an iatrogenic outcome. [Note added in 2004: As is known in 2004, but not known in 2000 when the IPT article was written, buckyballs are toxic at 20 parts per billion, and are thus not benevolent. However, soot, in 2004, in 2000, and at all previous relevant times, has far, far more polynuclear aromatics than buckyballs specifically or fullerenes generally.]

[IPT available LEXIS: March 13, 2000; see also article in National Law Journal on Shelby amendment in 2000.]

**** Later study of the impact of the Shelby amendment did not confirm Holt's fears.

-->In the Spring 2001, the Science, Technology and Law Program of the National Research Council (NRC) held a workshop on the effect of the "Shelby" Amendment on public access to research data. Agencies representatives at that meeting indicated that they had received relatively few FOIA requests under the Shelby Amendment for scientific information (14 from NIH and 7 from EPA). <--

Similar findings were also reported by the Government Accounting Office (GAO) at . The GAO additionally noted:

-->Each of the eight federal agencies we examined relies on university scientists who receive federally funded research grants to make the results available to the public; five of these agencies also disseminate results by posting them on their Web sites. Although university scientists customarily seek to publish their research results in peer-reviewed journals, agencies cannot require such publication as a condition for funding because it is impossible to ensure in advance that the results will be deemed by peer review to be acceptable for publication. Agencies do, however, explicitly encourage funding recipients to make results available to the public, and they consider scientists' publication records in reviewing grant applications. Agriculture, Defense, Energy, EPA, and NASA also disseminate the results of the research they fund by posting researchers' final reports on their Web sites because, according to officials at these agencies, Web sites offer an effective way to share information among scientists, as well as with the public. In contrast, NIH officials told us that they do not post researchers' final reports because, in the biomedical field, the risks associated with posting results that have not been scrutinized and validated by peer review are too great. Similarly, NSF officials said that NSF does not post results, partly because some scientific journals reject manuscripts if the results have already been posted on the Web. Education currently is considering how best to respond to the directive in the Education Sciences Reform Act of 2002 to widely disseminate the findings and results of scientifically valid research in education. We are recommending that Education post the results of the research it has funded on its Web site to facilitate access to and maximize the benefits of its research investment. Education agreed with our recommendation.<--