IP News

Supreme Court Grants Certiorari in Business Method Patent Case

On Oct. 31, 2005, the U.S. Supreme Court agreed to review a question arising from the decision in Metabolite Labs., Inc. v. Lab. Corp. of America Holdings, 370 F.3d 1354 (Fed. Cir. 2004). (After voting to grant certiorari, Chief Justice John Roberts recused himself from participation in the case. After reconsideration, the Court again granted the petition.) The question presented by this case is:

Whether a method patent setting forth an indefinite, undescribed, and non-enabling step directing a party simply to 'correlat[e]' test results can validly claim a monopoly over a basic scientific relationship used in medical treatment such that any doctor necessarily infringes the patent merely by thinking about the relationship after looking at a test result.

This case involves claim 13 of U.S. Patent 4,940,658 (“the '658 patent”), which recites: “[a] method for detecting a deficiency of cobalamin or folate [B vitamins] in warm-blooded animals comprising the steps of: assaying a body fluid for an elevated level of total homocysteine; and correlating an elevated level of total homocysteine in said body fluid with a deficiency of cobalamin or folate.” Deficiencies in cobalamin and folate can cause illnesses such as vascular disease, cognitive dysfunction, birth defects, and cancer. Once detected, however, a deficiency can be treated with vitamin supplements.

The '658 patent was granted to researchers at University Patents Inc. (“UPI”). UPI's successor, Competitive Technologies Inc., licensed the patent to Metabolite, which in turn sublicensed the patent to Roche Biomedical Laboratories (now Lab. Corp.). Lab. Corp., a laboratory testing company, originally performed homocysteine assays under the sublicense. In 1998, Lab. Corp. switched to a homocysteine assay developed by Abbott Laboratories and discontinued royalty payments to Metabolite for homocysteine assays. As a result, Metabolite sued Lab. Corp. for infringement. The case proceeded to a jury, which found that Lab. Corp. breached its license agreement with Metabolite, that Lab. Corp. willfully infringed the '658 patent, and that the claims at issue are not invalid. The jury assessed damages against Lab. Corp. of $3,652,724.61 for breach of contract and $1,019,365.01 for infringement. After the trial, the district court denied Lab. Corp.'s motion for JMOL on infringement, breach of contract, invalidity, and willful infringement. In light of the finding of willfulness, the district court doubled the jury's infringement award to $2,038,730.02. The district court also permanently enjoined Lab. Corp. from using the homocysteine-only test. Lab. Corp. appealed the district court's claim construction as well as the denial of JMOL.

On appeal, the Federal Circuit affirmed, finding that substantial evidence supported the jury's verdict that doctors directly infringed the '658 patent. The Federal Circuit further found that Lab. Corp. actively induced infringement by publishing Continu-ing Medical Education articles as well as a Directory of Services that states that elevated total homocysteine correlates to cobalamin/folate deficiency, and that this deficiency can be treated with vitamin supplements.

The Supreme Court agreed to review this case even though the U.S. Solicitor General recommended that cert. be denied. Lab. Corp. claimed in its petition that, according to Metabolite's theory, “every one of the thousands of doctors who orders one of the millions of homocysteine tests performed for patients nationwide necessarily infringes [the '658 patent] because the doctor looks at the test result and allegedly thinks that the result might indicate something about the existence or non-existence of a vitamin deficiency” (emphasis in original).

Supreme Court Grants Certiorari in Business Method Patent Case

On Oct. 31, 2005, the U.S. Supreme Court agreed to review a question arising from the decision in Metabolite Labs., Inc. v. Lab. Corp. of America Holdings , 370 F.3d 1354 (Fed. Cir. 2004). (After voting to grant certiorari, Chief Justice John Roberts recused himself from participation in the case. After reconsideration, the Court again granted the petition.) The question presented by this case is:

Whether a method patent setting forth an indefinite, undescribed, and non-enabling step directing a party simply to 'correlat[e]' test results can validly claim a monopoly over a basic scientific relationship used in medical treatment such that any doctor necessarily infringes the patent merely by thinking about the relationship after looking at a test result.

This case involves claim 13 of U.S. Patent 4,940,658 (“the '658 patent”), which recites: “[a] method for detecting a deficiency of cobalamin or folate [B vitamins] in warm-blooded animals comprising the steps of: assaying a body fluid for an elevated level of total homocysteine; and correlating an elevated level of total homocysteine in said body fluid with a deficiency of cobalamin or folate.” Deficiencies in cobalamin and folate can cause illnesses such as vascular disease, cognitive dysfunction, birth defects, and cancer. Once detected, however, a deficiency can be treated with vitamin supplements.

The '658 patent was granted to researchers at University Patents Inc. (“UPI”). UPI's successor, Competitive Technologies Inc., licensed the patent to Metabolite, which in turn sublicensed the patent to Roche Biomedical Laboratories (now Lab. Corp.). Lab. Corp., a laboratory testing company, originally performed homocysteine assays under the sublicense. In 1998, Lab. Corp. switched to a homocysteine assay developed by Abbott Laboratories and discontinued royalty payments to Metabolite for homocysteine assays. As a result, Metabolite sued Lab. Corp. for infringement. The case proceeded to a jury, which found that Lab. Corp. breached its license agreement with Metabolite, that Lab. Corp. willfully infringed the '658 patent, and that the claims at issue are not invalid. The jury assessed damages against Lab. Corp. of $3,652,724.61 for breach of contract and $1,019,365.01 for infringement. After the trial, the district court denied Lab. Corp.'s motion for JMOL on infringement, breach of contract, invalidity, and willful infringement. In light of the finding of willfulness, the district court doubled the jury's infringement award to $2,038,730.02. The district court also permanently enjoined Lab. Corp. from using the homocysteine-only test. Lab. Corp. appealed the district court's claim construction as well as the denial of JMOL.

On appeal, the Federal Circuit affirmed, finding that substantial evidence supported the jury's verdict that doctors directly infringed the '658 patent. The Federal Circuit further found that Lab. Corp. actively induced infringement by publishing Continu-ing Medical Education articles as well as a Directory of Services that states that elevated total homocysteine correlates to cobalamin/folate deficiency, and that this deficiency can be treated with vitamin supplements.

The Supreme Court agreed to review this case even though the U.S. Solicitor General recommended that cert. be denied. Lab. Corp. claimed in its petition that, according to Metabolite's theory, “every one of the thousands of doctors who orders one of the millions of homocysteine tests performed for patients nationwide necessarily infringes [the '658 patent] because the doctor looks at the test result and allegedly thinks that the result might indicate something about the existence or non-existence of a vitamin deficiency” (emphasis in original).