Breakingviews-U.S. justices' hefty IP docket is patently logical

Fri Feb 15, 2013 2:25am IST

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

By Reynolds Holding

NEW YORK, Feb 14 (Reuters Breakingviews) - The U.S. Supreme Court's hefty docket of intellectual property lawsuits is patently logical. The justices are reviewing fewer total cases but more involving IP. That makes sense. Patent law is badly muddled, as next week's oral argument on rights to altered soybean seeds is likely to demonstrate.

The case involves seeds that Monsanto genetically modified to withstand weed killer. They were sold on the condition that farmers would grow a single crop and not plant any harvested seeds. But one farmer exploited a loophole to raise a second crop, arguing that, like any patent holder, the agriculture giant couldn't block the resale of a patented product. Two courts backed Monsanto, however, and the Supreme Court agreed to hear the case.

Confusion over a company's patent rights is distressingly common. Many software patents, for instance, are so broad and fuzzy that it's hard to tell exactly what they cover. That provokes overlapping claims to some of high tech's most valuable ideas — and costly litigation over smartphones and other gadgets. The biotech industry also struggles with uncertainty over gene patents and methods for reading blood tests.

The U.S. Court of Appeals for the Federal Circuit, the nation's top patent court, is largely to blame. In 1994, for example, it stopped requiring that patents be tied to specific uses and allowed protections for virtually any software with a practical purpose. The court may have been trying to promote technological advances, but it ended up gutting the rule against patenting abstract ideas.

The Supreme Court has started to rein in the Federal Circuit. While the justices' total docket has shrunk — from almost 150 cases a year two decades ago to about 75 in 2012 — the share of intellectual property lawsuits has risen, from 2 percent in 1992 to 6 percent in 2010. Many of those suits reversed the Federal Circuit's decisions. This term, seven of the 76 cases before the justices involve intellectual property issues.

Beyond fixing a lower court's mistakes, however, rulings in those cases should promote innovation by making the law more predictable. With the importance of patents growing, that could be crucial for the economy's future.

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CONTEXT NEWS

- The U.S. Supreme Court on Feb. 19 will hear arguments about whether Monsanto's patent on genetically modified soybean seeds prohibits a farmer from using them to grow crops and then planting the harvested seeds.

- The farmer, Vernon Bowman of Indiana, argued that the giant agriculture company only has the right to control the first generation of seeds but not the second generation, just as patent holders generally cannot stop the resale of a patented product. But Monsanto says growing new plants from the harvested seeds is like making unauthorized copies of a patented items. Bowman is appealing a 2011 ruling in favor of Monsanto by the U.S. Court of Appeals for the Federal Circuit.

- Reuters: U.S. Supreme Court to review Monsanto seed patents [ID:nL1E8L5B8C]

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(Editing by Antony Currie and Martin Langfield)

((reynolds.holding@thomsonreuters.com)(Reuters messaging reynolds.holding.thomsonreuters.com@reuters.net)) Keywords: BREAKINGVIEWS SUPREME/

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