Panelists: Kevin E. Noonan, JD, PhD Partner, McDonnell Boehnen Hulbert & Berghoff LLP Jim Baker, PhD Director of technology and economic development at

Panelists: Kevin E. Noonan, JD, PhD Partner, McDonnell Boehnen Hulbert & Berghoff LLP Jim Baker, PhDDirector of technology and economic development at the Houghton-based Michigan Technological UniversityWesley D. Blakeslee, BS, JD, CLPExecutive director of Johns Hopkins Technology Transfer

Sponsored By:

Technology Transfer Tactics 877-729-0959 www.technologytransfertactics.com

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Overview :

In re Bilski, 545 F.3d 943, 88 U.S.P.Q.2d 1385 (Fed. Cir. 2008), is an en banc decision of the United States Court of Appeals for the Federal Circuit on the patenting of method claims, particularly business methods.

The Federal Circuit court affirmed rejection of patent claims involving a method of hedging risks in commodities trading. The en banc court also adopted the “machine-or-transformation test” as the exclusive test for patent-eligibility of method claims, and renunciated the “useful, concrete, and tangible” test in State Street Bank v. Signature Financial Group.

The Supreme Court of the United States granted certiorari on June 1, 2009 and oral argument on the patent applicants’ appeal was heard on November 9, 2009.

http://en.wikipedia.org/wiki/Case_citation

Technology Transfer Tactics 877-729-0959

www.technologytransfertactics.com3

The Future?

• There is no crystal ball to determine the future. Unfortunately…..

The Supreme Court could affirm or reverse the Federal Circuit Court’s decision

• Speculation of the possibilities and uncertainties


www.technologytransfertactics.com

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What’s Affected?

• The scope extends further than you might think • Question the patentability of all software

• How about other methods such as:- Control technologies- Signal processing algorithms- Manufacturing/production technologies/methods- Financial services industry-Methods of detecting and treating disease

- Classen v. Biogen- Prometheus v. Mayo



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Understanding the Machine-or-Transformation Test

• As clarified in Bilski, the test for a method claim is whether the claimed method is:

(1) tied to a particular machine or apparatus, or

(2) transforms a particular article to a different state or thing.

If Bilski is upheld, claims must be tied to a particular machine or must transform a particular article into a different thing

Machine or transfer elements can’t be added solely to satisfy the test – they must be necessary to the invention and must limit the scope of the claim.

Counterpoint – claim elements can be practiced without the machine (e.g. mentally or manually for computer related inventions).



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Pre-Disclosure: Working with faculty to configure innovations with M&T test in

mind

• What enables the method to be used? (e.g. a microprocessor or physical machine) • What comes out of the method and how is that either made useful or used by the user. For example:

- does it result in the control/adjustment of something - how is output data manipulated on a computer to allow it to be usable (at all and/or more efficiently/effectively)

• How can you describe the method/algorithm in ways that someone couldn’t do it with just their mind or without some sort of machine or computer programmed to do it.• How can you describe the method in a way that does not envelop substantially

all practical applications. • Focus on the other non-patentable, but value-added such as: data sets, know- how, etc.



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Disclosure and Triage/Assessment: How should your investment and patent criteria change post-Bilski?

• “Glass half-full” perspective: A tough case in the expected post-Bilski world was probably a tough case in the pre-Bilski world so it can help substantiate your triage outcomes.

• Review cases for likelihood of passing the M/T test - If not…

- What can be substantively changed so that they do- What complementary elements of value (e.g. know-how or execution diligence) can be added to the portfolio beyond the original idea and any patentable subject matter that it represents

• Can infringement be detected

• How many alternatives are available that don’t require the M/T elements that you will need to incorporate into your claims

• Because the law is constantly changing you want to have a disclosure in the specification that would support claims appropriate under State Street, under Bilski and under Diamond v. Diehr.



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Issues Related to Patent Strategy

• Impact on non-US rights

• Using “do-not-publish” applications during pendency

• Claim construction to match PTO guidance

• Considering reissue applications for issued patents

• Responding to rejections



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Issues Related to Patent Strategy

• Impact on non-US rights

• Using “do-not-publish” applications during pendency

• Claim construction to match PTO guidance

• Considering reissue applications for issued patents

• Responding to rejections



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Alternatives to Patent Protection:

• Trade secrets: - Often better where the activity is actually proprietary - Reverse engineering

• Know-how: - Supporting execution of the business opportunity (reasonably) can be more valuable than the IP in many cases. - Data sets, complex mathematical formuli, etc. not typically published because they aren’t part of the scientific discovery

• Copyrights: - Strong option for software



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Assessing and Minimizing Impact on Existing Licenses

• Communicate with your licensees and maintain a respectful relationship

• If you suspect a licensee to raise questions of the validity of a licensed patent:- Be open to discussion and possibly to negotiation as appropriate but do your own homework/diligence and understand how strong (or weak) your position is.- At the end of the day, value is a function of enforceability which may or may not be compromised by the outcome of Bilski.

• An issued patent is valid until ruled otherwise

• Consider filing continuations or CIPs to keep pending cases open until the final rules are known.

• Even after Bilski- a patent is a patent and a license is a license. That will not change!



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Recalibrating Enforcement Actions

A Bright Side? Impact on Patent “Trolls”

• Less likely to push a bad position? We’ll see….

• What’s the effect on future patent litigation?

• Be realistic about enforceability and its relation to value.

• Look for partners instead of adversaries whenever possible.



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Panelist InformationPanelist Information

Kevin E. Noonan, Ph.D., is a Partner with McDonnell Boehnen Hulbert & Berghoff LLP and has extensive experience in biotechnology and the chemical arts. Dr. Noonan brings more than 10 years of experience as a molecular biologist working on high-technology problems to his legal work. He has wide experience in all aspects of patent prosecution, interference, litigation, and client counseling on validity, infringement, and patenting strategy matters. He represents pharmaceutical and biotechnology companies both large and small, and he is particularly experienced in representing university clients in both patent prosecution and licensing to outside investors.

([email protected])

Wesley D. Blakeslee, BS, JD, CLP, is executive director of Johns Hopkins Technology Transfer. He was formerly an associate general counsel at The Johns Hopkins University, where he practiced intellectual property and complex business law. Wes holds an engineering degree from Penn State University, and a law degree from the University of Maryland School of Law and is a Certified Licensing Professional. He began his professional career as an engineer and systems analyst with NASA, was later a partner in a small regional firm, and in 1983 formed his own practice in Westminster, Maryland, USA. From 1983 to 1989, while in private practice, Wes also served as director of

computer development at the University of Maryland Law School, where he also taught computer law. He is frequently a featured speaker at national, state and local conferences and has been cited as a national authority on intellectual property issues in the Chronicle of Higher Education, and other publications. ([email protected])

Jim Baker, PhD, is currently the Director of Technology and Economic Development at Michigan Technological University. Jim’s current responsibilities include handling University inventions from disclosure, through patenting, and licensing to both established and startup businesses. Within the University, he is also responsible for terms of industrial sponsored research, non-disclosure, and material transfer agreements, as well as other related agreements with private sector partners. In addition to University technology transfer and industrial contracting, Jim directly supports the growth of regional technology companies through a close working relationship with a diverse network of the local and regional economic development partners and service providers including the Michigan Small Business and Technology Development Center supported by the U.S. Small Business Administration. Prior to entering the technology transfer field, Jim served as the Acting Director of the Michigan SmartCel Business Accelerator and has held positions in the engineering and information technology fields including the General Director of ChemAlliance, an online chemical industry regulatory compliance assistance center and Program Manager of the National Center for Clean Industrial and Treatment Technologies. Jim is a registered Patent Agent and holds a Ph.D. in Environmental Engineering from Michigan Technological University. ([email protected])

Documents

Panelists: Kevin E. Noonan, JD, PhD Partner, McDonnell Boehnen Hulbert & Berghoff LLP Jim Baker, PhD Director of technology and economic development at