No True Inventor Left Behind: Clarifying Issues of Joint Inventorship After American BioScience, Vanderbilt, and Falana
By Thomas W. Banks, Ian Y. Liu, and Philippe K. Edouard, Finnegan, Henderson, Farabow, Garrett & Dunner
On May 1, Pfizer announced the settlement of a $450 million lawsuit with Brigham Young University over development of the blockbuster painkiller Celebrex. The settlement avoided an eight-week trial after a six-year lawsuit to determine whether Brigham Young Professor Daniel Simmons was an inventor on patents covering Celebrex.
I. Joint Inventorship Law Is Extremely Complex
Despite a long history of precedent, patent inventorship remains one of the most complex areas of patent law. Nearly 150 years ago, the U.S. Supreme Court held in Agawam Woolen Co. v. Jordan that the mere suggestion of ancillary improvements by an alleged inventor, even if valuable in achieving a desired result, is not sufficient to establish joint inventorship. 74 U.S. 583, 606 (1868).
Although patent inventorship law has evolved significantly since then, there remains considerable uncertainty about what makes a person a joint inventor of a patent.
Three recent cases from the Federal Circuit: Board of Education v. American BioScience, Vanderbilt University v. ICOS Corp., and Falana v. Kent State University, highlight the complex nature of joint inventorship law as it pertains to pharmaceutical inventions. These cases reflect the Federal Circuit’s continuing efforts to provide clarity to those engaged in scientific collaborations, especially academic institutes and pharmaceutical companies.
This article examines the current inventorship law as set forth by these cases and provides practical suggestions for dealing with issues that trigger inventorship disputes.
II. Conception Determines Inventorship
The proper inventors on a patent are those who conceive the subject matter claimed in the patent. Burroughs Wellcome Co. v. Barr Laboratories Inc., 40 F.3d 1223, 1228, 32 USPQ2d 1915 (Fed. Cir. 1994). Conception requires one to have a definite and permanent idea of the operative invention, including every feature of the subject matter claimed. Id. An idea is permanent and definite when only ordinary skill would be required to reduce the invention to practice. Id.
The conception analysis often raises unique and complex considerations, particularly when the subject matter involves biology or chemistry. For example, when the result of a biological process is claimed, conception requires that the alleged inventor(s) have a reasonable expectation of producing the claimed invention. Hitzeman v. Rutter, 243 F.3d 1345, 1358, 58 USPQ2d 1161 (Fed. Cir. 2001) (61 PTCJ 519, 3/30/01). For a chemical invention, conception of a chemical compound requires knowledge of both the specific chemical structure of the compound and an operative method of making the compound. Fina Oil and Chemical Co. v. Ewen, 123 F.3d 1466, 1473, 43 USPQ2d 1935 (Fed. Cir. 1997); see also Oka v. Youssefyeh, 849 F.2d 581, 583, 7 USPQ2d 1169 (Fed. Cir. 1988).
III. Joint Inventorship
Joint inventorship exists when two or more individuals contribute to the conception of an invention. The statutory basis for joint inventorship is found at 35 U.S.C. § 116:
When an invention is made by two or more persons jointly, they shall apply for a patent jointly and each make the required oath … . Inventors may apply for a patent jointly even though (1) they did not physically work together or at the same time, (2) each did not make the same type or amount of contribution, or (3) each did not make a contribution to the subject matter of every claim of the patent.
The case law provides that a joint inventor must contribute in some significant manner to the invention. Pannu v. Iolab Corp., 155 F.3d 1344, 1351, 47 USPQ2d 1657 (Fed. Cir. 1998) (56 PTCJ 444, 8/13/98). The contribution to the claimed invention cannot be insignificant in quality when measured against the dimension of the full invention. Id.
One who merely explains well-known concepts and/or the current state of the art to the real inventors is not a co-inventor. Id. The determination of joint inventorship is fact-specific; there are no bright-line standards that will apply to every case. Fina Oil, 123 F.3d at 1473.
IV. Recent Case Law Clarifies Joint Inventorship
A. American BioScience
The statutes and early case law pertaining to joint inventorship are relatively uncontroversial. A 2003 Federal Circuit case, however, muddied the waters.
In Board of Education v. American BioScience Inc., 333 F.3d 1330, 67 USPQ2d 1252 (Fed. Cir. 2003) (66 PTCJ 258, 6/27/03), American Bioscience obtained a patent on taxoteres, useful in treating cancers. Florida State University claimed that its scientists were joint inventors of several analogs of the taxotere family. The FSU scientists, including one Dr. Tao, conducted research on taxols, chemically similar to the claimed taxoteres.
Tao left FSU and joined ABI’s predecessor-in-interest to work on developing the taxoteres. The project eventually led to ABI’s predecessor filing a patent application naming only Tao and ABI scientists as inventors.
When the patent issued, FSU sued ABI in district court seeking to add its scientists as inventors and to remove ABI’s scientists other than Tao. FSU prevailed in the district court and ABI appealed to the Federal Circuit.
On appeal, ABI argued that the FSU scientists were not joint inventors because they did not contribute to the conception of the specific taxotere compounds claimed in the disputed ABI patent.
The Federal Circuit agreed and reversed, holding that the FSU scientists did not conceive the claimed compounds:
[I]nvention does require conception, and there is no evidence that FSU’s inventors conceived any of the claimed compounds. Having in mind specific portions of a claimed compound is not the same as conceiving the compound with all its components. One must have conception of the specific compounds being claimed, with all their component substituents, and the record does not support a finding that [FSU's scientists] conceived the three claimed compounds … .
B. Vanderbilt v. ICOS
The Federal Circuit also addressed these issues in Vanderbilt University v. ICOS Corp., 601 F.3d 1297, 94 USPQ2d 1481 (Fed. Cir. 2010) (79 PTCJ 753, 4/16/10), cert. denied, 131 S. Ct. 1043 (2011) (81 PTCJ 382, 1/28/11). In that case, Vanderbilt sought to add its scientists as joint inventors on ICOS patents.
The patents at issue claimed certain PDE5 inhibitors and methods for treating erectile dysfunction. Vanderbilt entered into a joint collaboration with Glaxo Inc. to develop PDE5 inhibitors for Glaxo’s cardiovascular program.
Outside the collaboration, Vanderbilt scientists developed a base compound suitable for further modification and a PDE5 inhibitor of significant potency. The Vanderbilt scientists described the potent analog and the base compound in a letter to Glaxo UK.
The letter also explained Vanderbilt’s overall strategy of enhancing the potencies of existing inhibitors by using certain structural modifications, and described using the compounds to treat male impotence, which was not one of Glaxo’s interests at the time.
A few months later, the Vanderbilt scientists sent Glaxo UK a more detailed letter proposing a list of compounds for further testing. Many of the proposed compounds had the same so-called “Vanderbilt Structural Features” found in Vanderbilt’s base compound.
Later, Glaxo France tested a number of compounds for PDE5 inhibition. One of the compounds underwent further structural modifications and eventually became the lead compound claimed in the disputed patents.
Glaxo assigned its interest in the patents to ICOS. In its claim against ICOS to correct inventorship, Vanderbilt argued that Glaxo could not have arrived at the claimed compound without the work of Glaxo scientists.
Both the district court and the Federal Circuit ruled against Vanderbilt. A significant portion of the Federal Circuit opinion was directed to clarifying the district court’s interpretation of American BioScience. The district court relied on American BioScience in ruling against Vanderbilt, finding that the Vanderbilt scientists did not conceive the specific chemical structure of the claimed compound or the compound with all of its components because the Vanderbilt Structural Features provided only a portion of the claimed compound.
Accordingly, the district court explained that even if the disclosed Vanderbilt Structural Features led to the identification of the claimed compound, the American BioScience case precluded a finding for Vanderbilt because the Vanderbilt scientists did not independently conceive the claimed invention.
The district court’s rationale reflected a misinterpretation of American BioScience, namely that each alleged co-inventor is required to have independently conceived the claimed subject matter.
In Vanderbilt, the Federal Circuit clarified this misunderstanding at length. While one must have a conception of the specific claimed invention to be an inventor, the court made it clear that in cases of joint inventorship, it is the group of collaborators together that must conceive the claimed invention.
In American BioScience, FSU’s inventorship claim failed because FSU and ABI were not working together, but were instead competing for patent rights in the claimed compounds. The Vanderbilt holding is consistent with the statutory requirements of 35 U.S.C. § 116, which provides that a group of individuals working together towards a common goal may be joint inventors even though they were physically separated by space or time.
Despite the Federal Circuit’s well-reasoned explanation of joint inventorship law, the plaintiffs in Vanderbilt nonetheless lost because the two groups were not working together towards a common goal and thus did not show clear and convincing evidence that the scientists at Glaxo France ever appropriated the work of the Vanderbilt scientists.
C. Falana v. Kent State
In the recent Falana v. Kent State University case, 669 F.3d 1349, 101 USPQ2d 1414 (Fed. Cir. 2012) (83 PTCJ 432, 2/3/12), however, the plaintiff established joint inventorship based on the holding in Vanderbilt.
In Falana, Olusegun Falana was hired by Kent Displays Inc., a spin-off of Kent State University, to develop and synthesize organic compounds. While at KDI, Falana developed a synthesis protocol for producing a novel genus of compounds.
Using this protocol, Falana made a compound within the genus. Falana’s compound constituted significant, but ultimately inadequate, progress towards KDI’s goals. Falana subsequently left KDI.
After Falana’s departure, his supervisor used Falana’s protocol to synthesize another compound within the same novel genus. Falana’s compound and his supervisor’s were closely related enantiomers. The supervisor’s compound, however, satisfied the goals of KDI’s program.
KDI and Kent State filed a patent application claiming a class of compounds without listing Falana as an inventor. When the patent issued, Falana sued claiming joint inventorship. The district court found in favor of Falana and the Federal Circuit affirmed.
Relying on American BioScience, the defendants argued that even if Falana contributed the method of making the compounds, that contribution was insufficient to establish joint inventorship because the claims recited only compositions and not methods, and the compound Falana synthesized did not fall within the scope of the claims. The Federal Circuit rejected these arguments, holding that where the method of synthesizing the claimed compound requires more than the exercise of ordinary skill in the art, the discovery of that method is as much a contribution to the compound as the discovery of the compound itself. Falana, 669 F.3d. at 1358.
Accordingly, a putative inventor who envisioned the structure of a novel genus of chemical compounds and contributed the method of making that genus contributed to the conception of that genus. Consistent with the discussion of joint inventorship law in Vanderbilt, Falana, as an individual, was not required to have independently conceived the claimed compounds to be a joint inventor. Falana and the other researchers at KDI worked together to jointly conceive the claimed compounds, with Falana contributing the only method available to synthesize these compounds.
Although the Federal Circuit perhaps muddied the waters of joint inventorship law in American BioScience, both Vanderbilt and Falana clarify the law.
An individual co-inventor is not required to have his own independent conception of the entire claimed invention. Rather, it is the group of collaborators together who must conceive the claimed compound. Vanderbilt and Falana clarify what it takes to be a joint inventor.
In collaborations between pharmaceutical companies and institutes, the institute typically contributes basic research. This may include, for example, a class of novel compounds or the discovery of a pathway.
The pharmaceutical company uses this basic research to develop a final drug candidate. By using the basic research to accelerate the company’s development and commercialization of the final drug candidate, the company has the potential to monopolize the newly developed market by being the first and only option.
Basic research, however, usually has a broader focus. Multiple products and markets may arise from a new compound or pathway. These additional markets may not have been anticipated by the institute or the company. By receiving an exclusive license from the institute, the company can exclude competitors from entering these markets.
Thus, a collaboration with an institute can greatly benefit a pharmaceutical company in at least two distinct ways: (1) by identifying lead compounds enabling the pharmaceutical company to leapfrog its competitors and monopolize a new market, and (2) by providing an opportunity for the pharmaceutical company to exploit additional secondary markets.
B. Impact of American BioScience, Vanderbilt, and Falana
The American BioScience, Vanderbilt, and Falana cases raise a number of important questions in the context of a collaboration. The first is whether or not to collaborate in the first place.
A collaboration can provide a company with new market opportunities that it would not otherwise have access to, and the first entrant often secures a significant share of the market. Such an opportunity may be too promising to pass up.
However, it is less clear whether a collaboration is advantageous for second generation drugs and their secondary and/or yet-to-be-identified markets. While the collaborating institute may have valuable insight regarding new applications, the institute’s basic research may serve only as a starting point and the company may fare equally well on its own.
The second question is how to collaborate. If the goal of the collaboration is to develop and commercialize a first-in-class drug as quickly as possible, the collaboration may be not only desirable, but essential.
In this type of collaboration, a free flow of information between the collaborating parties becomes critical. This flow of information, however, creates more opportunities for scientists to work together to invent, thus creating more jointly owned patents as in Falana. These co-owned patents can create issues surrounding ownership and control of the technology, not to mention disputes about inventorship, which can be costly and disruptive.
On the other hand, if the purpose of the collaboration is to develop a second generation drug or to identify and exploit new markets, it becomes less clear whether a free exchange of information is more advantageous than maintaining each parties’ technology confidential.
To foster a healthy collaboration and minimize disputes, it may be advisable to follow a few basic guidelines.
First, clearly define the scope of the collaboration at its outset, particularly the collaborating parties’ respective responsibilities. This can prevent the parties from straying into unintended areas, while allowing each collaborator the freedom to independently develop second-generation drugs or identify and exploit additional and/or yet-to-be-identified markets.
For example, one team of scientists can work on the lead compound and the other team can work independently on the second generation drugs or on additional markets. This may minimize disputes over joint inventorship.
Nevertheless, the collaborating parties need to carefully consider the contributions of all respective collaborators prior to filing a patent application. Some key questions should be asked: (1) Did the collaborator contribute specialized knowledge, materials, or protocols to the joint effort that were unavailable to the general public? (2) Would the invention have been possible without such contributions? (3) Were these contributions communicated to the other collaborator? (4) Did the subject matter of those communications actually make its way into the invention? (5) Was it clear that a joint effort existed?
The answers to these questions will certainly help determine whether joint inventorship is appropriate. The sharing of specialized knowledge, materials, or protocols may constitute a significant contribution warranting joint inventorship even though the contributor did not play a role in determining the final form of the invention. Joint inventors do not have to contribute at the same time, and an invention may result from several stages of collaborative research and development.
Additionally, all parties to a collaboration should be aware of the vital role that documentation plays in resolving inventorship disputes. Joint development and license agreements may serve to establish the existence of a collaboration.
Communication of data and experimental results by one party to another may also serve to establish the existence of joint effort when combined with acknowledgment of such communications. Comments on such data/results may help assess the significance of the contribution.
Along similar lines, statements of praise by one party regarding the others’ work may establish a significant contribution. For example, although not addressed by the Federal Circuit, Falana’s employers described Falana as “the sole organic chemist responsible for the synthesis of the chiral materials” and stated that Falana’s “outstanding performance led to a patent we are currently preparing.”
Such laudatory statements are not uncommon in collegial scientific collaborations and can lead to judicial findings of joint inventorship.
American BioScience, Vanderbilt, and Falana provide valuable lessons for assessing joint inventorship and resolving related disputes. Although American BioScience may have muddled joint inventorship law, Vanderbilt and Falana provide much-needed clarification of this complex area of the law.
Thomas W. Banks and Ian Y. Liu, Ph.D., are attorneys with Finnegan, Henderson, Farabow, Garrett & Dunner, Cambridge, Mass. Banks focuses on patent and trade secret litigation and patent counseling, predominantly in the life sciences. He can be reached at (617) 452-1610 or firstname.lastname@example.org. Liu’s practice includes patent litigation, alternative dispute resolution, patent preparation and prosecution, and patent counseling. He can be reached at (617) 452-1627 or email@example.com.
Philippe K. Edouard, formerly with Finnegan in Boston, is currently an associate with BrownRudnick, Boston. Edouard represents foreign and domestic clients in various aspects of U.S. and international patent prosecution. He can be reached at (617) 858-8504 or firstname.lastname@example.org.
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