This morning’s argument in Helsinn v. Teva Pharmaceuticals brought the justices their first patent case of the year. As expected, this argument included little of the technical concerns that so often dominate patent cases.  This case comes to the court as a simple and confined question of statutory language, and the argument suggested that the court will resolve it from that perspective.

The dispute involves provisions of the Patent Act that “bar” an inventor from obtaining a patent if the inventor publicizes the invention or exploits it commercially before filing an application with the patent office. In one form or another, those provisions have been a part of American patent law since the early 19th century, and for much of that time the provisions have barred a patent if the invention previously was “on sale,” at least if the sale occurred more than a year before the patent application. Congress revised the relevant provisions in 2011 when it adopted the Leahy-Smith America Invents Act (universally known as the AIA).

As revised by the AIA, the current statute bars a patent if “the claimed invention was … in public use, on sale, or otherwise available to the public before” the patent filing. The central issue in the case is what to make of the phrase that refers to inventions “otherwise available to the public,” a phrase added by the AIA. Helsinn (which holds the pharmaceutical patent under attack) argues that the phrase shows that all of the listed bars apply only if the activity makes the invention available to the public. Thus, Helsinnn argues, although it made some private sales of the pharmaceutical before it sought a patent, those should not bar the patent because they were not the kind of “public” sales that amount to putting the invention “on sale.” Teva (a generic pharmaceutical company selling a product that would infringe the Helsinn patent) argues that the addition of language covering activities that make an item “otherwise available to the public” simply created an entirely separate bar that sheds no light on the meaning of the on-sale bar. For Teva, Helsinn’s sale of the pharmaceutical, whether public or private, is enough to bring the on-sale bar into play.

Most of the justices who spoke at any length seemed to take the view that it is long-settled that an inventor triggers the on-sale bar by any type of sale, whether public or private, and that Congress’ slight revision of the statute in 2011 could hardly be thought sufficient to overturn that understanding. Justice Brett Kavanaugh, for example, suggested that “it’s pretty hard to say something that has been sold was not on sale” and seemed persuaded that “it[’s] always [been] the case that if you offer it to even one person or to a small group of people, it’s on sale.” He was particularly pointed in his dismissal of the suggestion by Kannon Shanmugam (representing Helsinn) that Congress intended in the AIA to “clarify” that an invention is “on sale” only if it is “available to the public”: “If that was a clarification, it was a terrible clarification because there were a lot of efforts, as you well know, to actually change the ‘on sale’ language, and those all failed.”

Kavanaugh responded even more vigorously when the legislative history came up in the presentation of Malcolm Stewart (representing the U.S solicitor general, in support of the patentholder Helsinn):

You mentioned the legislative history, but isn’t this a classic example of trying to snatch victory from defeat in some of the legislative statements? … [T]here was this law before, as Justice [Elena] Kagan mentions, a huge effort to change it, lots of proposals to change it. They all fail.

Kagan’s analysis seemed a bit different, though probably leading to the same conclusion, as she seemed to grant the point that the language as written was at least ambiguous as to whether a private sale like Helsinn’s should be enough to bar a patent. For her, though, like Kavanaugh, it was not credible that the revision of the statute in 2011 was specific enough to change the settled meaning.

Justice Sonia Sotomayor seemed especially settled on the traditional conception of the on-sale bar. Thus, in an interchange with Stewart, she suggested that the historical understanding of the on-sale bar posed a real problem for the patentholder:

[T]o be frank with you, I’ve looked at the history cited in the briefs, I looked at the cases, I don’t find it anywhere. You’re sort of giving “on sale to the public” its meaning, but those are not the words used by Congress. … Congress just said “on sale.” … And when you have a historical term that has a history, as a matter of course, we look at that history.

Justice Stephen Breyer seemed to have a similar view, as he commented that he read the court’s existing cases to suggest that “the purpose of this on-sale rule … is to prevent people from benefiting from their invention prior to and beyond the 20 years that they’re allowed,” and that an inventor who decides to “exploit his discovery competitively after it is ready for patenting” forfeits his right to a patent.

The strongest view on the other side of the matter came from Justice Samuel Alito, who found the “meaning of the new statutory language” to be “fairly plain.” Thus, questioning William Jay (representing the generic manufacturer Teva), he bluntly commented: “I find it very difficult to get over the idea that this means that all of the things that went before are public. … That’s what ‘otherwise’ means.”

I don’t see this as a case in which the argument clearly presages the result. Several of the justices had little to say, and among those who spoke it seems pretty clear that there are at least tentative views on both sides of the question. Having said that, the balance of the justices’ comments, which largely favored Teva, suggests that the most likely outcome will be an affirmance of the U.S. Court of Appeals for the Federal Circuit, holding that an inventor puts an invention “on sale,” and thus loses a right to patent it, upon any sale, public or private.

Editor’s Note: Analysis based on transcript of oral argument.

Posted in Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA Inc., Featured, Merits Cases

Recommended Citation: Ronald Mann, Argument analysis: Justices debate revised language in patent-priority statute, SCOTUSblog (Dec. 4, 2018, 7:50 PM), http://www.scotusblog.com/2018/12/argument-analysis-justices-debate-revised-language-in-patent-priority-statute/