Patent Trends in the U.S. Supreme Court

Terry Wright

The majority of U.S. Supreme Court commentators today seem to be focusing on how the new court will rule on issues such as affirmative action and abortion.  However, there is one set of commentators and barristers who seem to only be talking about a subject that has come up infrequently in Supreme Court jurisprudence over the last four decades - patent law.  Over the last 40 years, the Supreme Court has paid little attention to patent law.  However, during the 2005-2006 term the Supreme Court heard oral arguments in four patent cases, the largest number in four decades, thus suggesting that the Court’s lack of interest in patent law may be about to change.  In fact, the dissent by Justice Breyer in the case of Laboratory Corp. v. Metabolite Industries, 126 S.Ct. 2921 (2006), seems to indicate a growing concern among the members of the Supreme Court that patent protection is given to too many inventions.  In his dissent, joined by Justices Stevens and Souter, Justice Breyer stated that “too much patent protection can impede rather than promote the progress of science and the useful arts.”  This dissent seems to suggest that at least three of the Supreme Court Justices are becoming increasingly concerned about the quality and quantity of the patents being issued by the United States Patent and Trademark Office.

In addition to the dissent in Metabolite, perhaps the most important case that arose out of the 2005-2006 term was eBay Inc. v. MercExchange, 126 S.Ct. 1837 (2006), which rejected the Federal Circuit’s long standing precedent that once an infringement is shown, an injunction should be issued against the infringer absent some “exceptional circumstances.”  The Supreme Court, however, held that the standard for granting injunctions in patent cases should be the same as in other cases, with the injunction being awarded only if the plaintiff in the case is able to satisfy the traditional four-part test: (1) that it has suffered an irreparable injury; (2) that remedies available at law, such as monetary damages, are inadequate to compensate for that injury; (3) that, considering the balance of the hardships between the plaintiff and defendant, a remedy in equity is warranted; and (4) that the public interest would not be disserved by a permanent injunction.  Thus, the Supreme Court has now made it significantly harder for patent owners to obtain injunctions (**For more about this issue see the Brand’s article on Patent Trolls and the eBay decision.), thus diminishing the owner’s ability to push infringers into settlements.

This recent trend in changing the federal patent system seems to be carrying into the 2006-2007 Supreme Court Term.  On Monday, June 26, 2006, the Supreme Court agreed to hear a case that, for the first time in almost 30 years, will examine the standard for “obviousness” being applied by the Court of Appeals for the Federal Circuit.  In KSR International Co. v. Teleflex Inc. (No. 04-1350), the Court of Appeals held that the “teaching-suggestion-motivation test,” which can invalidate a double-patent if the prior art provides “[a] teaching, suggestion, or motivation to combine the references,” requires the court to make factual findings showing the “specific understanding or principle within the knowledge of the skilled artisan that would have motivated one with no knowledge of [the] invention to make the combination” in the particular manner claimed by the double-patent.  This “teaching-suggestion-motivation test” to determine the obviousness of an invention has been a consistent staple of Federal Circuit obviousness jurisprudence for several decades.  However, the Supreme Court seems poised to tackle the issue.  An issue that could produce enormous ramifications within the patent system and result in it becoming harder or perhaps impossible to patent many inventions.

With these growing trends in Supreme Court patent law jurisprudence, The Brand will be sure to continue to follow not only the KSR International case but, hopefully, other patent cases in the Supreme Court this term.