A Review of U.S. Intellectual Property Law Applicable to Biotechnology
Volume 6, No. 1, Winter 2001
Theodore A. Feitshans
Intellectual property includes patents, trade secrets, copyrights, and trademark protection. The Supreme Court has determined that a living organism or its parts can be patented. Some plant varieties, like Roundup Ready® soybeans and Bt cotton, now contain patented genes. Patenting, however, has limitations. The patent application must be filed within one year and is only effective in the United States. To obtain patent protection in foreign countries, an application must be filed in each country where protection is desired. A trade secret is another way to protect intellectual property. It has a potentially infinite duration since it lasts as long as secrecy can be maintained. Most inventions are held as trade secrets until a patent is obtained. Copyright protection has not, to date, been employed to protect the intellectual property of genetically modified organisms (GMOs) and trademark protection is only used to protect the names under which GMOs are marketed.
Intellectual property is a generic term for intangible personal property that includes patents, trademarks, copyrights, and trade secrets. For an innovative business, intellectual property may be the most valuable asset, more valuable even than plant and equipment. For biotechnology companies, intellectual property is often essential to their financing and survival. Intellectual property has always been important to agriculture. Much of the new agricultural equipment of the nineteenth century that made possible agricultural expansion into the Great Plains was subject to patent protection. Many commentators have seen intellectual property as key to innovation and economic prosperity. Without the protection of intellectual property, companies could not profit from their research and development, and they risk having the good name that they have spent years developing plundered by imitators selling inferior products. This presentation will provide a general introduction to intellectual property and issues specific to agricultural biotechnology.
Utility Patent Protection
Congress has authorized the U.S. Patent and Trademark Office (the Patent Office) to issue a patent to any person who invents a product or process that is novel, nonobvious, and useful. Such patents are often called utility patents to distinguish them from special types of patents discussed below. Numerically and economically, utility patents are by far the most important type of patent. For a product or process to be novel it must be new, meaning that no other person has made, sold, or published a description of the product or process prior to the application. The Supreme Court has determined that a living organism or a part of a living organism may be patented. Indeed, many patents have been granted for genes of particular organisms. A gene is a component of the genetic code of an organism. Some plant varieties, like Roundup Ready® soybeans and Bt cotton, now contain patented genes. In addition to patenting genes and entire organisms, biotechnology companies may also obtain patent protection on the equipment and processes developed to create novel genes and organisms.
An important limitation on the availability of patent protection is that the inventor must file a patent application with the Patent Office within one year of the first commercial use or publication of the invention. A further limitation is that a patent issued by the Patent Office is effective only within the territory of the United States. To obtain patent protection in foreign countries, an application must be filed in each country where protection is desired. The United States is party to international agreements that facilitate this process. Unlike the United States most foreign countries offer no grace period for prior use or publication of the invention. Foreign rights may be lost as the result of any prior commercial use or publication of the invention prior to filing of foreign patent applications.
Patent protection is generally available for a term of 20 years from the date of filing the patent application. During that period, the owner of the patent has the right to exclude all others from making, using, or selling any product or process that contains or uses the patented technology. A patent does not, however, confer a right to use. For example, use of a patented organism may be banned as too hazardous to the public health or the environment. Any other person who makes, uses, or sells any part of that patented technology is an infringer. An infringer is liable to the patent owner for damages even if the infringer was unaware of the patent or the infringement. A court may treble damages and award attorney fees against one who knowingly infringed a patent.
Patenting of living organisms poses special problems for the patent system. To enable the public to practice an invention embodied in a self-replicating organism, a deposit must be made in an acceptable depository. With regard to gene patents, the Patent Office requires “the use of standard symbols and a standard format for sequence data in most sequence-type patent applications.” This is a departure from general Patent Office practice that allows the inventor to be his own lexicographer. The Patent Office has also recently clarified the utility requirements for gene patents. These changes may have profound implications for some applicants. In clarifying the utility requirement, the Patent Office decided against developing a utility standard specifically for gene patents and stated that the utility must be “specific and substantial.” Statements of fact made by the applicant are treated as true unless one skilled in the art would doubt them. A lack of utility is also the basis for a rejection based upon a failure to disclose how to use the invention.
As with the utility requirement, the Patent Office decided to develop neutral standards for the written description requirement that apply across all arts. The written description must be sufficient that one skilled in the art could practice the invention. In order to avoid confusion, the Patent Office has elected not to attempt to define the word “gene.” Taken together these requirements will prevent applicants from obtaining patent protection on nucleotide sequences with no known applications other than as the subject of further research.
A special type of patent is available for new varieties of plants found in cultivated areas. Section 161 provides “[w]hoever invents or discovers and asexually reproduces any distinct and new variety of plant, including cultivated sports, mutants, hybrids, and newly found seedlings, other than a tuber propagated plant or a plant found in an uncultivated state, may obtain a patent therefor, subject to the conditions and requirements of this title. The provisions of this title relating to patents for inventions shall apply to patents for plants, except as otherwise provided.” These are called plant patents and are available for asexually reproduced plants. Plants capable of reproducing by seed are also covered if they are capable of being asexually reproduced. Plant patents cannot be obtained on tuber crops such as Irish potatoes and Jerusalem artichokes. The new plant must be a distinct variety. No deposit is required for plants that are the subject of plant patents. Nonetheless, the applicant may be required to provide a specimen of the plant.
Certificates of Protection under the Plant Variety Protection Act
Certificates of Protection are available through the Plant Variety Protection Office of the U.S. Department of Agriculture. This patent-like form of protection is available where “the breeder of any sexually reproduced or tuber propagated plant variety (other than fungi or bacteria) who has reproduced the variety shall be entitled to plant variety protection for the variety…” The term of a certificate of protection is 20 years for most crops and 25 years for trees, shrubs, and vines.
Trade Secret Protection
A trade secret is information that has value to a business and which is not generally known to the public. The law of trade secrets is a matter of state law and varies from state to state. Trade secrets are of potentially infinite duration since they last as long as secrecy can be maintained. Most inventions will be held as trade secrets prior to obtaining patent protection. To preserve trade secret status the owner of the trade secret must take affirmative steps to preserve the secrecy. Confidentiality agreements with employees, collaborators, and sources of capital are a key component of convincing courts that affirmative efforts to preserve trade secrets have been made.
Trade secret protection may also be a permanent alternative to patent or other formal protection for biotechnology inventions. Trade secret protection is particularly appropriate for process inventions where the process remains under the control of the owner. The pre-grant publication practices of some foreign patent offices may also indicate that trade secret protection is the better means for protecting certain biotechnology inventions since the pre-grant publication destroys the trade secret and there is no guarantee that a patent will ever be granted.
There are a variety of means available to protect inventions in GMOs and other biotechnologies; however, utility patent and trade secret protections have been the most important. Utility patent protection has become essential for convincing investors to fund biotechnology-based businesses. Plant patents and certificates of protection under the Plant Variety Protection Act has not played a significant role in providing protection for the intellectual property embodied in GMOs; however, these forms of protection may become more important as GMOs enter wider commercial production and useful variations of the original GMOs are observed. Copyright protection has not, to date, been employed to protect the intellectual property in GMOs; however, there is no theoretical reason that it could not be used in an appropriate circumstance. Trademark protection is used to protect the names under which GMOs are marketed; however, a discussion of trademarks is beyond the scope of this article. Listed below are some useful web sites.
American Intellectual Property Law Association http://www.aipla.org/ (The AIPLA is an organization of more than 10,000 attorneys who practice intellectual property law.)
Intellectual Property Owners Association http://www.ipo.org/
Title 7 Agriculture, Chapter 57 Plant Variety Protection http://www4.law.cornell.edu/uscode/7/ch57.html
Title 15 Commerce and Trade, Chapter 3 Trade-Marks http://www4.law.cornell.edu/uscode/15/ch3.html
Title 17 Copyrights http://www4.law.cornell.edu/uscode/17/
Title 35 Patents http://www4.law.cornell.edu/uscode/35/
U.S. Copyright Office http://lcweb.loc.gov/copyright/
USDA, AMS, Plant Variety Protection Office http://www.ams.usda.gov/science/PVPO/pvp.htm
U.S. Patent and Trademark Office http://www.uspto.gov/
Theodore A. Feitshans, J.D., Extension Specialist and Lecturer, Department of Agricultural and Resource Economics, NC State University, Raleigh, North Carolina.
Cite this article:
Feitshans, Theodore. “A review of U.S. intellectual property law applicable to biotechnology.”The Forum for Family and Consumer Issues 5.3 (2001): 11 pars. February 2001.