In arguments before the Supreme Court last month, Stanford University claimed that because its research that resulted in three PCR-based test kit patents — which the school alleges Roche Molecular Systems has infringed upon — was partly supported by federal funding, it has superior claim to title under the University and Small Business Patent Procedures Act, better known as the Bayh-Dole Act. Congress enacted Bayh-Dole in 1980 as an amendment to the Patent Act in an effort to protect the intellectual property interests of universities, small businesses, and non-profit organizations. Since the Stanford v. Roche suit was filed six years ago, the case has evolved from a straightforward patent infringement litigation into an overarching dispute over interpretations of Bayh-Dole.
In 2005, Stanford sued Roche, claiming the firm's PCR-based test to measure HIV viral load in blood plasma has been infringing on three patents held by one of its researchers, Mark Holodniy. In 1988, Holodniy signed a copyright and patent agreement with Stanford saying "I will assign" future IP to the university, before he and others there began collaborating with investigators at Cetus. As Holodniy signed a visitor's confidentiality agreement in 1989 saying "I hereby assign" intellectual property to Cetus. Roche — which acquired Cetus' PCR business assets in 1991 — claims that it owns the patents, which were filed in 1992.
Speaking on behalf of Stanford in February, attorney Donald Ayer told the Supreme Court that "Roche's sole claim rests on an assignment from an inventor who was at the time, I think without question, a Stanford employee who was working on a project under a federal funding agreement." Mark Fleming, an attorney for Roche, said that there is a chink in the Bayh-Dole Act's armor. There are "doctrines that the government or a bona fide third-party purchaser could invoke, including section 261 of the Patent Act, or a lawsuit for re-assignment," he told Chief Justice John Roberts and the court. Patent Act section 261 delineates IP ownership on the basis of documented assignments. Section 261 says, in part, that "an assignment, grant, or conveyance shall be void against any subsequent purchaser ... without notice."
Roberts then asked whether Fleming was suggesting "that Congress [had passed] a law that could … be easily circumvented not only by the inventor, but by the inventor and contractor working together." Justice Elena Kagan later asked Malcom Stewart, amicus curiae on behalf of the US, whether this supposed flaw in Bayh-Dole was specific to Stanford's argument, or whether other institutions might be subject to third-party agreements similar to those Roche's Fleming described.
"I think there are probably a lot of universities that use this language ... it's very natural to distinguish between a present assignment and a promise to assign in the future with respect to an invention that now exists," Stewart told the Court, adding that, in the future, "universities could change their contracts if that was what was necessary."
According to The Stanford Daily, the Supreme Court is expected to make a ruling in this case by July.