BIO Joins 261 Business, Research Institutions and Organizations to Urge Caution in Microsoft v. i4i Case*

*UPDATE – 90 more organizations have decided to add their names to the letter sent to the Department of Justice.  Please find the new letter.

Please find attached an open letter to Attorney General Holder and Acting Solicitor General Katyal, signed by 171 businesses, research institutions and organizations of all sizes, representing U.S. innovation in all 50 states and the District of Columbia. The signatories include leading innovators in agriculture, biotechnology, consumer products, electrical, mechanical  and chemical engineering, green energy, manufacturing, pharmaceuticals, semiconductors, software, telecommunication and other sectors.

In signing this letter, BIO calls on the U.S. Department of Justice to proceed cautiously in developing the U.S. Government’s position in the ongoing high-profile patent litigation between Microsoft and i4i, a small software company. This case has recently been accepted for review by the United States Supreme Court and is being closely watched by domestic and foreign businesses from every technology sector, including biotechnology.

 

In this case, the Supreme Court is being asked to reconsider a longstanding rule of patent law, according to which those who challenge a patent before a lay jury or judge must carry a heightened burden of proof.  Under the current law, infringers who seek to overturn a patent must prove the facts of their case to a high degree of probability, by “clear and convincing evidence.” The rule ensures that patents that have been examined and issued by the U.S. Patent and Trademark Office (USPTO), and that have been relied on by patentees and the public, can only be overturned on strong, reliable, and convincing evidence.

In Microsoft v. i4i, the U.S. Supreme Court is now being asked to lower this burden of proof. As now proposed, patents could be invalidated more easily in district court litigation by using evidence that was not noted in the USPTO’s patent examination file. Effectively, patents that are challenged on such evidence would carry only the weakest possible presumption of validity – a “preponderance” standard according to which courts could overturn patents even if the facts of the case are established only to a 51% likelihood. This would be a big change in longstanding law that could make it significantly more difficult to rely on strong patent rights for licensing, partnering, investment, and product development decisions in all industry sectors.

We believe this case to be of critical importance to U.S. innovation policy, and are greatly concerned about its potentially negative consequences for domestic innovation, job growth, and U.S. technological leadership internationally. Because the U.S. Government’s position is likely to be very influential in this Supreme Court case, we ask that the Department of Justice weigh these implications carefully, and arrive at any official position only after consulting a broad range of stakeholders whose perspectives differ from those of a narrow group of big companies who would benefit from such a shift in the law.

A comprehensive collection of documents in this case can be found at http://www.scotusblog.com/case-files/cases/microsoft-v-i4i-limited-partnership/ and http://www.i4ilp.com/papers.php .

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BIO’s Comments on proposed PTO Humanitarian Technologies and Licensing Through the Intellectual Property System

Here are the highlights from BIO’s recent submission on the proposed PTO “Request for Comments on Incentivizing Humanitarian Technologies and Licensing Through the Intellectual Property System.”  

Background:

1.  “BIO’s members also understand that problems with access to medicines and other biotechnology products in the developing world have very little to do with the patent system, and are generally caused by other factors outside the control of individual stakeholders, such as lack of adequate local manufacturing, delivery, public health and sanitation infrastructure, trade and tariff barriers, regulatory obstacles, lack of market incentives, inequitable local distribution and corruption, diversion of products to more lucrative markets, and a chronic underinvestment in public health, education and environmental conservation. In fact, access issues persist even in countries where there are no patents covering humanitarian products and technologies.”

 2.  “While the patent system cannot be a primary policy lever to address these complex questions above, BIO nonetheless believes that innovative businesses from all sectors of the U.S. economy, including the biotechnology industry, can help improve the lives of underprivileged populations in the developing world. Indeed, BIO member companies have long participated in specific access and licensing initiatives that have informed the policy choices of members of the industry.”  (See http://www.globalhealthprogress.org/, http://www.ifpma.org/healthpartnerships, http://www.bvgh.org/LinkClick.aspx?fileticket=867bPGw-kYo%3d&tabid=105, http://www.aatf-africa.org/, and http://www.cimmyt.org/.)

 “Most recently, in May of this year, BIO announced a policy statement containing its Options for Increasing Access to Medicines in the Developing World that it believes should be considered during the development and commercialization of biotechnology products.  Accordingly, BIO commends the USPTO for likewise exploring creative and market-oriented ways to incentivize the development and distribution of humanitarian technologies, a goal that BIO and its members have long shared and are working hard to achieve. In addition, BIO would support efforts to bring together all potential stakeholders to explore various approaches and initiatives.”

Key Points:

1.  Any program should be technology-neutral – “In BIO’s view, such a program should be applicable to innovators from all sectors who engage in the creation and dissemination of technology that has the potential to address the needs of impoverished populations in the developing world.”

 2.  Any proposal should ensure USPTO’s core mission is maintained and adequately resourced.

 3.  Value of any proposed vouchers should be maximized, but will remain limited – “BIO believes that the commercial value of the proposed voucher could be substantial under some situations, but difficult to express in monetary terms at this time.” 

4.  Clarity of standing for voucher use needed – “BIO members are seriously concerned that vouchers could potentially be used by third party requesters, or even unrelated third parties, to accelerate the ex parte reexamination of other party’s patents without the patentee’s consent.”

5.  Policy options for voucher award process require further discussion – “BIO members also raised the question whether the proposed vouchers should be awarded as an entitlement for meeting certain objective criteria, or as a more subjective prize for extraordinary humanitarian licensing efforts.”

Conclusion:

“BIO understands this Federal Register notice to be a first conceptual step in what will be a deliberative process with additional opportunities for public review and comment as more specific details and approaches are proposed. With this understanding, we look forward to engaging further on this effort in partnership with the USPTO and other industries and stakeholders.”

BIO’s Full Comment