LabCorp v. Metabolite: providently dismissed.

• Author: Kent, Robert

TABLE OF CONTENTS I. INTRODUCTION II. FACTUAL AND TECHNOLOGICAL BACKGROUND III. THE LITIGATION A. Licensing Transaction and District Court Litigation B. Appeal Before the Federal Circuit C. Supreme Court Proceedings IV. ANALYSIS A. Evolution and Conceptual Separation of Patent Law B. Current Confusions in the Patentable Subject Matter Doctrine C. LabCorp: The Wrong Vehicle for § 101 Review V. CONCLUSION I. INTRODUCTION

In 1990, Metabolite's corporate predecessor obtained a patent on methods of measuring certain vitamin deficiencies. In several patent claims, it described its blood test in detail; in another claim, it asserted the exclusive right to any method that involves measuring the level of a particular chemical and "correlating" any elevation with a vitamin deficiency. The Supreme Court initially granted certiorari on the question of whether this claim could be construed so broadly that a doctor's mental correlation of one number with another would constitute infringement. However, after the question was completely briefed--including the filing of twenty-one amicus briefs (1)--and oral arguments had been heard, the Court dismissed certiorari as having been improvidently granted.

In dismissing certiorari, the Court likely made the right decision for patent doctrine as a whole. The underlying facts of the case arguably presented a solid basis for a reexamination of the patentable subject matter doctrine due to the clarity and breadth of the claim language. Furthermore, through amicus briefs, many constituencies were represented in this litigation that are not ordinarily parties to patent validity disputes. The petitioner, however, had waived its right to challenge the patent under 35 U.S.C. § 101 (2) through failure to plead, and the substance of the question on which certiorari was granted is plainly § 101 material. (3)

While it may seem a technicality, this defect plagued all of the trial and appellate pleadings of Laboratory Corporation of America ("LabCorp"), up to and including its petition to the Court, throughout which it strained to present the issue through various 35 U.S.C. § 112 (4) rubrics, all of which were unavailing. While it may have been possible for the Court to read a more stringent patentable subject matter standard into the distinctness, written description, or enablement requirements of § 112, such a move would unnecessarily muddle patent law doctrines that have been deliberately separated through statutory revisions and Federal Circuit precedent. If the Court were to reconsider patentable subject matter doctrine, it should base such reconsideration on a conflict involving parties who have fully and directly argued the issue. Though the regulatory deck is stacked against plaintiffs looking to challenge the current § 101 doctrine, the Court's manifest interest in the topic might embolden such challenges in the near future.

2. FACTUAL AND TECHNOLOGICAL BACKGROUND

   The core technology of U.S. Patent No. 4,940,658 ("'658 Patent") is an improved test for certain vitamin deficiencies. Abnormally low levels of cobalamin (vitamin [B.sub.12]) and folate (folic acid) can lead to life-threatening neuropsychiatric problems5 as well as increased risk for cardiovascular disease. (6) The problems caused by such vitamin deficiencies can almost always be easily treated in their early stages by the administration of supplements of the deficient vitamin. (7) It is, therefore, crucial to accurately detect such vitamin deficiencies as early as possible. In the early 1980s, it was the belief of the medical community that deficiencies in cobalamin and folate could only be associated with anemia (8) or assayed directly. (9) Because these tests were not very accurate, a better alternative was needed. (10) Around this time, three doctors associated with University Patents, Inc. ("UPI") discovered that cobalamin and folate deficiencies were correlated with high levels of homocysteine in the blood. (11) They developed improved blood tests for homocysteine and published their findings in 1985. (12) In 1986, they applied for a patent on the new homocysteine tests. (13)

   Claim 1 of the '658 Patent describes the homocysteine assay in general terms. (14) Claims 2 through 12 depend on claim 1 and describe several slightly narrower variations on the test. (15) Claim 13, however, describes a method for detecting cobalamin or folate deficiency that merely calls for "assaying a body fluid for an elevated level of total homocysteine" and "correlating an elevated level of total homocysteine ... with a deficiency of cobalamin or folate." (16) Claim 13 is an independent claim and does not rely on any of the specific tests described in claims 1 through 12. (17)

   As originally filed, claim 13 did not include a "correlating" step. (18) The patent examiner rejected the claim because, without such a step, "[t]he claim lack[ed] a positive limitation for correlating to a particular condition," among other reasons. (19) In response to this rejection, UPI added the correlating step to create the version of claim 13 which eventually issued in 1990 as part of the '658 Patent. (20)

3. THE LITIGATION

   1. Licensing Transaction and District Court Litigation

      After the patent's issuance, Competitive Technologies, Inc. ("CTI") succeeded UPI in ownership of the '658 Patent and licensed it to Metabolite. (21) Metabolite sublicensed the patent to Roche Biomedical Laboratories, which later became LabCorp. (22) LabCorp used the patented homocysteine assay to perform blood tests for homocysteine levels. (23) However, in 1998, in an effort to cut costs, LabCorp stopped paying royalties on the patent license (24) and switched to a different homocysteine assay developed by Abbott Labs. (25) After LabCorp stopped paying royalties, Metabolite sued in the United States District Court for the District of Colorado for direct, contributory, and induced infringement of the '658 Patent and for breach of the licensing agreement. (26)

      At a pretrial claim construction hearing, the district court partially adopted LabCorp's suggested construction of the term "correlating," holding that "correlate" meant "to establish a mutual or reciprocal relation of." (27) The district court granted LabCorp's motion for summary judgment on the direct infringement claim, (28) finding that LabCorp itself had not performed the "correlating" step of claim 13 simply by performing the homocysteine assays. (29) However, the contributory and induced infringement and breach of contract claims were sent to the jury, which found LabCorp liable for both indirect patent infringement and breach of contract and awarded damages to Metabolite on both counts. (30) The district court doubled the portion of the award attributed to patent infringement, since it found the infringement to be willful, and ordered a permanent injunction against LabCorp. (31)

      In its answer to Metabolite's patent-related claims, LabCorp raised fourteen affirmative defenses, including two related to the invalidity of the '658 Patent. (32) At no point during the district court proceedings did LabCorp plead that claim 13 of the '658 Patent was invalid as falling outside of patentable subject matter in violation of 35 U.S.C. § 101. (33)

   2. Appeal Before the Federal Circuit

      In its appeal before the Federal Circuit, LabCorp contested the indirect infringement, claim construction, and breach of contract rulings. (34) It also argued invalidity based on indefiniteness, lack of written description, and lack of enablement. (35) The crux of LabCorp's argument on indefiniteness was that "[i]f the Court were to uphold this vague claim [13], anyone could obtain a patent on any scientific correlation--that there is a link between fact A and fact B.... CTI would improperly gain a monopoly over a basic scientific fact." (36) In support of this argument, LabCorp cited Diamond v. Diehr, a landmark Supreme Court decision stating that "laws of nature, natural phenomena, and abstract ideas" are excluded from patent protection by 35 U.S.C. § 101. (37) However, claim definiteness is a requirement of 35 U.S.C. § 112, (38) which LabCorp duly cited in its brief. (39) LabCorp did not cite § 101. Its arguments that the patent lacked proper written description and enablement both centered on that the patent nowhere described how the "correlation" should be performed. (40)

      In response to LabCorp's argument on claim definiteness, the Federal Circuit held that the district court's claim construction had "produced a discernable and clear meaning" for the term "correlating" and that the claim was therefore not indefinite. (41) The Federal Circuit also rebuffed LabCorp's written description and enablement arguments. (42) Nowhere did the Federal Circuit cite Diehr or 35 U.S.C. § 101, and indeed, it affirmed the district court's judgment in all respects. (43)

      Judge Schall filed a partial dissent to the panel opinion, disagreeing with the majority as to the construction of claim 13. (44) The patent's literal language claims only "correlating an elevated level of total homocysteine ... with a deficiency of cobalamin or folate." (45) Therefore, Judge Schall reasoned, the claim scope was limited to situations where an elevated homocysteine level was present, and could not be infringed if the homocysteine level was found to be normal. (46) Judge Schall concurred with the panel in all other aspects of the case. (47)

   3. Supreme Court Proceedings

      LabCorp submitted a three-question petition for certiorari to the Supreme Court on November 3, 2004. (48) Question one was directed to the Federal Circuit's standard for finding willful inducement of infringement, and question two was directed to claim construction. (49) Question three was:

      Whether a method patent setting forth an indefinite, undescribed, and non-enabling step directing a party simply to "correlat[e]" test results can validly claim a monopoly over a basic scientific relationship used in medical...