DC finding of personal jurisdiction over foreign entities and finding genetic testing claims ineligible under 101 affirmed

Genetic Vet. Sciences, Inc. (“PPG”) v. Laboklin GmbH & Co., KG, The University of Berlin

Docket No. 2018-2056
August 9, 2019

Brief Summary: DC finding of personal jurisdiction over foreign university and its foreign licensee affirmed; finding of no eligibility of claims for detecting genetic mutations under section 101 affirmed.

Summary: Paw Prints Genetics (“PPG”) appealed DC DJ finding Laboklin’s US 9,157,114 directed to “[a]n in vitro method for genotyping a Labrador Retriever” by genotyping a particular gene as being unpatentable under section 101. The University and exclusive licensee Laboklin appealed the DC’s denial of its motion to dismiss for lack of subject-matter and personal jurisdiction (PJ). The FC panel first addressed the jurisdiction issues. Laboklin’s principal place of business is in Germany but under its license “was required to commercialize the invention in North America ‘within [a specific time period] of the Effective date’” and, at the time the motion was filed “had entered into two sublicenses” in the US. PPG is headquartered in the State of Washington, and ran tests regarding the gene in the ‘114 patent (SUV39H2). The FC panel explained that, under FRCP Rule 4(k)(2) and Supreme Court’s due process requirements, it “allow[s] a court to exercise personal jurisdiction over a nonresident if: ‘(1) the plaintiff’s claim arises under federal law, (2) the defendant is not subject to jurisdiction in any state’s courts of general jurisdiction, and (3) the exercise of jurisdiction comports with due process’”; the “nonresident defendant” had “certain minimum contacts with [the forum]”; and, “the defendant purposefully directed its activities at residents of the forum”, “the claim arises out of or relates to the defendant’s activities in the forum”, and “assertion of personal jurisdiction is reasonable and fair” (Synthes, FC 2009; Int’l Shoe, US 1945; Inamed, FC 2001; Burger King, US 1985). The FC panel agreed with the DC that PJ over Laboklin since “in addition to sending the cease-and-desist letter to PPG”, it “entered into sublicenses in” CA and MI is “reasonable and fair”. It also found jurisdiction over the University under the Foreign Sovereign Immunities Act (“FSIA”, “a foreign state is presumptively immune” (Saudi, US 1993)) since “an exception to sovereign immunity applies” “if a foreign state engages in ‘commercial activity…in the” US (28 USCA sec. 1605(a)(2)), and the University “obtained a U.S. patent and then participated in licensing and enforcing” it.

The FC panel also agreed with the DC that the ‘114 patent claims are directed to unpatentable subject matter under section 101, “namely the discovery of the genetic mutation that is linked to” Hereditary Nasal Parakeratosis (“HNPK”). The claims require “obtaining a biological sample” from a LR, “genotyping a SUV39H2 gene”, and “detecting the replacement of” T by G “at position 972”, or using a particular technique (dependent claim 2) primer pair (dependent claim 3). The FC panel explained that in Ariosa (FC 2015), and In re BRCA1 (FC 2015 and FC 2014), “the end result of the process, the essence of the whole, was a patent-ineligible concept”, but that in Cellz Direct (FC 2016) the claims “were directed to a ‘new and improved technique[] for producing a tangible and useful result’” (see also Vanda, FC 2018 (“a specific method of treatment…using a specific compound at specific doses to achieve a specific outcome”) and Natural Alternatives, FC 2019 (patentable dietary supplement for increasing anaerobic muscle capacity of muscle)). Here, the court found that the claims “begin and end with the point discovery of the HNPK mutation”, “nothing more that ‘observing or identifying’ the natural phenomenon of a mutation” (Myriad, US 2013; CellzDirect; Alice, US 2014 (step one)). And the court did not find an “inventive concept” under Alice’s step two since, e.g., “[n]othing in claim 1’s language suggests the invention of a new method of genotyping”, the claims “use[] conventional or known laboratory techniques to observe the newly discovered mutation”, and provide “no tangible result save the observation and detection of a mutation”. Thus, the DC decision was affirmed.

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