University of Rochester Corp. V. G.D. Searle & Co., Inc.: How to Lose Millions in Patent Royalties

Abstract

In the modern knowledge-driven economy patents are deployed as negotiable instruments in business deals between business entities. The Patent Office grants a patent in lieu of the inventor disclosing the invention, in compliance with the Patent Act such that it enables a person of ordinary skill in the art to practice the invention. The disclosure serves as a notice to the general public as to the boundaries of the invention. An ill-defined patent invention may not adequately serve a proper notice to the general public as to what technology is off-limits and what is available for practice. This can lead to confusion amongst entities interested in practicing technologies related to the invention and an unnecessary investment of capital.

The present comment discusses University of Rochester's patent infringement lawsuit seeking an injunction against G.D. Searle from manufacturing and selling Celebrex7, the arthritis pain-relief drug. Celebrex7 had a worldwide sale of approximately $3 billion in 2002. The university officials had estimated that the patent could generate billions of dollars in royalties over its life span. Defendants countered that the patent in question was invalid for lack of (i) written description requirement and (ii) enablement requirement of the Patent Statute.

The district court granted a summary judgment in favor of G.D. Searle holding the patent invalid under the written description requirement and enablement requirement. In an indirect manner, the ruling, not so much because of its legal stance as its implications, has the potential to strangulate and dissuade a small-time inventor from inventing in favor of a big pharmaceutical corporation, which is contrary to the policy rationale behind the constitutional mandate for patents.

The University plans to appeal the ruling to the Federal Appeals Circuit. The patentee has a stronger argument on the enablement issue and may prevail at the Federal Circuit level. In order for the patent to remain enforceable, however, the entire set of statutory requirements need to be satisfied. Therefore, whether the patentee prevails on the exclusive issue of enablement would be a moot point in light of the weakness of argument in the written description requirement.

Keywords: Delaware, Journal, Corporate, Law