Utility

1
Utility Section 101

• 101. Whoever invents and new AND USEFUL machine,
  manufacture, . . .

2
Main Trouble Areas

• No known utility (perpetual motion machines)
• Newman v. Quigg, 877 F.2d 1575 11 USPQ2d 1340
  (Fed. Cir. 1989) (claims to a perpetual motion
  machine ruled inoperable)
• Malicious utility
• a "useful" invention is one "which may be applied
  to a beneficial use in society, in
  contradistinction to an invention injurious to
  the morals, health, or good order of society, or
  frivolous and insignificant"

3
Justice Story View

• Appendix, Note on the Patent Laws, 3 Wheat. 13,
  24. See also Justice Story's decisions on circuit
  in Lowell v. Lewis, 15 Fed. Cas. 1018 (No. 8568)
  (C. C. D. Mass.), and Bedford v. Hunt, 3 Fed Cas.
  37 (No. 1217) (C. C. D. Mass.).

4
Brenner v Manson, p 229

• This is not to say that we mean to disparage the
  importance of contributions to the fund of
  scientific information short of the invention of
  something "useful," or that we are blind to the
  prospect that what now seems without "use" may
  tomorrow command the grateful attention of the
  public.

5
Brenner, contd

• But a patent is not a hunting license. It is not
  a reward for the search, but compensation for its
  successful conclusion. "A patent system must be
  related to the world of commerce rather than to
  the realm of philosophy. "

6
In re Brana 34 U.S.P.Q.2d 1436 C.A.Fed.
Decided March 30, 1995
7
Brana, contd
8
R1-R4 Markush groups
N Markush group
9
Brana contd p. 245

• FDA approval, however, is not a prerequisite for
  finding a compound useful within the meaning of
  the patent laws. Usefulness in patent law, and in
  particular in the context of pharmaceutical
  inventions, necessarily includes the expectation
  of further research and development.. Were we to
  require Phase II testing in order to prove
  utility, the associated costs would prevent many
  companies from obtaining patent protection on
  promising new inventions, thereby eliminating an
  incentive to pursue, through research and
  development, potential cures in many crucial
  areas such as the treatment of cancer.
• -- 34 U.S.P.Q.2d 1436, 1443

10
Working Model or Prototype in vivo effectiveness
Promising Experimental Results Brenner v. Manson
Promising Clinical Results, e.g., in vitro In
re Brana
Project Initiation Pure Concept Stage
11
The Oklahoma Land Rush A Good Use of Resources?
12
(No Transcript)
13
Mining Claim Systems Require-ments and Timing
Issues
14
Some quick economics

• Terry L. Anderson Peter J. Hill, The Race for
  Property Rights, 33 J.L. Econ. 177 (1990)
• David D. Haddock, First Possession Versus Optimal
  Timing Limiting the Dissipation of Economic
  Value, 64 Wash. U. L.Q. 775 (1986).
• Dean Lueck, The Rule of First Possession and the
  Design of the Law, 38 J.L. Econ. 393 (1995)

15
Terry L. Anderson Montana State Hoover
Institution
David Haddock, Northwestern Law School
16
(No Transcript)
17
Ex Parte Fischer

• Claim 1
• Substantially purified echoes of Parke-Davis
• Selected from the group consisting of . . .
• What is this claim form?

18
Markush Group

• An article of clothing, selected from the group
  consisting of
• Shirts
• Shoes
• Pants

• A chemical entity selected from the group
  consisting of
• Carbon
• COOH
• CH(6)

19
Expressed Sequence Tags
Most DNA Unknown Function
EST Short Tag
The good stuff DNA that codes for a protein
20
Multiple Biotechnology Patents SNP/EST Example
A Owns SNP_1 (Or EST_1)
B Owns SNP_2/EST_2
C Owns SNP_3/EST_3
21
Fischer

• What utilities are claimed? P. 3
• determining a relationship between a
  polymorphism and a plant trait
• isolating a genetic region . . . Or mapping
• determining protein levels . . .

22
Fischer - holding

• P 22
• Immediate utility is to conduct further
  experiments
• Too attenuated under Brenner and Brana

23
Expressed Sequence Tag Patents

• Bad Idea! Eisenberg Merges opinion letter, 1995
• Patent laws utility requirement bars these
  patents
• Why? Rent Seeking Dominates incentive motive
  Transaction Costs a Major Issue

24
Transaction Costs
B
C
A
Firm E
End Product
25
Transaction Costs II
B
A
C
End Product
End Product
End Product