Genetic Techs. Ltd. v. Bristol-Myers Squibb Co.

• Decision Date: 30 October 2014
• Docket Number: C.A. No. 12–394–LPS, C.A. No. 12–396–LPS
• Citation: 72 F.Supp.3d 521
• Parties: Genetic Technologies Ltd., Plaintiff, v. Bristol–Myers Squibb Company, Defendant. Genetic Technologies Ltd., Plaintiff v. Merial LLC, Defendant.
• Court: U.S. District Court — District of Delaware

72 F.Supp.3d 521

Genetic Technologies Ltd., Plaintiff

v.Bristol–Myers Squibb Company, Defendant.

Genetic Technologies Ltd., Plaintiff

v.Merial LLC, Defendant.

C.A. No. 12–394–LPS

C.A. No. 12–396–LPS

United States District Court, D. Delaware.

Signed October 30, 2014

Raymond H. Lemisch, Klehr, Harrison, Harvey, Branzburg & Ellers, Wilmington, DE, Benjamin B. Lieb, Pro Hac Vice, Robert R. Brunelli, Pro Hac Vice, for Plaintiff.

Mary B. Graham, Derek James Fahnestock, Morris, Nichols, Arsht & Tunnell LLP, Wilmington, DE, Amy K. Wigmore, Pro Hac Vice, Tracey C. Allen, Pro Hac Vice, for Defendant.

MEMORANDUM OPINION

STARK, U.S. District Judge:

Presently before the Court are Defendants' motions to dismiss under Federal Rule of Civil Procedure 12(b)(6). Defendants argue that the patents-in-suit are directed toward unpatentable subject matter under 35 U.S.C. § 101. The Court agrees that claim 1 of United States Patent No. 5,612,179 (“the '179 patent”) impermissibly claims a natural phenomenon and, therefore, grants Defendants' motions with regard to this claim. With respect to any remaining asserted claims, the Court denies the motions without prejudice to renew.

I. PROCEDURAL BACKGROUND

On May 25, 2011, Genetic Technologies Ltd. (“GTG” or “Plaintiff”) filed a patent infringement action in the District Court for the District of Colorado against several defendants, including Bristol–Myers Squibb Company (“BMS”) and Merial LLC (“Merial”) (collectively, “Defendants”), alleging infringement of the '179 patent. See Genetic Techs. Ltd. v. Agilent Techs., Inc., C.A. No. 11–1389–WJM–KLM D.I. 1 (D.Colo. May 25, 2011). In March 2012, the pending claims against BMS and Merial, respectively, were severed and transferred to this District. See id. at D.I. 314 (D.Colo. March 28, 2012).

On March 29, 2012, GTG filed its First Amended Complaint in this District against BMS, alleging infringement of the '179 patent as well as United States Patent No. 5,851,762 (“the '762 patent”) (collectively, “the patents-in-suit”). (C.A. No. 12–394 D.I. 2) On that same day, GTG filed its First Amended Complaint in this District against Merial, again alleging infringement of the '179 patent.¹ (C.A. No. 12–396 D.I. 2)

Generally, the '179 patent relates to a method for detecting alleles of a genetic locus and haplotypes by amplifying genomic DNA with a primer pair spanning a non-coding sequence in genetic linkage with the allele to be detected. The '762 patent generally relates to a genomic mapping method based on the ability to identify haplotypes of individuals through analysis of non-coding region sequence variation patterns.

On February 3, 2014, BMS and Merial filed motions to dismiss for failure to state a claim on the basis that the patents-in-suit are directed to patent ineligible subject matter under 35 U.S.C. § 101. (C.A. No. 12–394 D.I. 35; C.A. No. 12–396 D.I. 52) The parties completed briefing on March 17, 2014. (C.A. No. 12–394 D.I. 36, 43, 48, 49; C.A. No. 12–396 D.I. 58, 63, 64² ) The Court heard oral argument on the motions on April 4, 2014. (See D.I. 51) (“Tr.”)

II. BACKGROUND³

The patented technology relates to deoxyribonucleic acid (“DNA”). The building blocks of DNA, known as “nucleotides,” consist of four bases: adenine (“A”), cytosine (“C”), guanine (“G”), and thymine (“T”). (Second Amended Complaint (“SAC”) at ¶ 7) The nucleotides form pairs with one another—G pairs with C and T pairs with A—in order to form the double helix structure of DNA. (Id. ) Stretches of this DNA sequence form genes, the units of heredity in an organism. (Id. at ¶ 8) Genes contain regions for coding proteins, known as “exons,” as well as non-coding regions, known as “introns.” ('179 patent at 5:40–50, 60:4–5) The DNA of different individuals varies significantly, and a variation among individuals' genetic sequences at a particular site in the genome is called a “polymorphism,” which can occur in both coding and non-coding regions. (See SAC at ¶¶ 9, 13) A genetic variation in the coding region of a gene is called an “allele.” (Id. at ¶ 9) Certain alleles are correlated with particular traits or diseases. (See '179 patent at 1:27–2:10; SAC at ¶ 9)

Early efforts at determining genetic differences among individuals focused on directly analyzing the coding region of genes (exons) to detect alleles. (SAC at ¶ 9) Although variations were also known to exist in non-coding DNA, these non-coding regions (introns) were largely dismissed as irrelevant, garnering the epithet “junk DNA.” (Id. at ¶ 15)

Through the work of a company called Genetype AG and Dr. Malcolm Simons, it was discovered that there can be a correlation between variations in non-coding introns and coding region alleles. (Id. at ¶ 16) Through what is referred to as meiosis, duplicate chromosomes exchange stretches of DNA (in a process called chromosomal crossover), resulting in shuffled chromosomes. (Id. at ¶ 11) Certain regions of each chromosome, however, tend to be inherited together with only rare shuffling. (Id. ) These stretches are said to be linked or in “linkage disequilibrium.”⁴ (Id. ) Coding region alleles at adjacent loci that are inherited together are known as a haplotype. (Id. at ¶ 12) Dr. Simons discovered that single nucleotide polymorphisms (“SNPs”) in non-coding DNA regions can also be in linkage disequilibrium with SNPs in coding regions of DNA. (Id. at ¶ 17)

The Amended Complaint depicts a hypothetical partial genomic DNA sequence (shown below) illustrating this linkage phenomenon. Arrows 1, 2, 3, and 4 each represent a SNP at four sites in the sequence:

(Id. at ¶¶ 13, 17) SNPs 1 and 4 are in non-coding regions, while SNPs 2 and 3 are in coding regions (both in the first exon). (Id. ) As the Amended Complaint explains, in this hypothetical sequence “SNPs 2 and 3 contribute to phenotypic variation, and they are in linkage disequilibrium with SNPs 1 and 4 because a gene is a unit of inheritance, meaning that everything within the gene is linked and inherited as a block.” (Id. ) Therefore, the genotypes of SNPs 1–4 are correlated, with SNPs 1 and 4 serving as “surrogate markers” for SNPs 2 and 3. (Id. at ¶ 17) The genotypes of SNPs 2 and 3 can be detected by determining the genotype of SNP 1 or SNP 4, as shown in the table above. (Id. )

Throughout a genome, various groups of SNPs are in linkage disequilibrium and, thus, exhibit the non-coding/coding correlations. (Id. at ¶ 19) Details of each correlation can vary and, in some instances, no correlation exists. (Id. )

Prior to the patents-in-suit, it was common for scientists studying DNA to “amplify” the portion of interest by making additional copies to allow for analysis. ('179 patent at 2:45–60, 3:5–12, 3:39–45, 5:55–6:3, 12:53–65) A common method for amplifying DNA was “polymerase chain reaction,” also known as “PCR.” ('179 patent at 2:45–60, 3:5–12; SAC at ¶ 25) In PCR generally, a pair of short, man-made strands of DNA, called a “primer pair,” which each match a specific short nucleotide sequence along complimentary strands of DNA, can be used in conjunction with an enzyme known as a “polymerase” to create copies of particular stretches of the DNA sequence. (See '179 patent at 2:45–60, 3:5–12, 5:66–6:3, 6:10–13; SAC at ¶¶ 23–24) Also in the prior art was another well-established technique for analyzing amplified DNA: restriction fragment length polymorphism (“RFLP”) pattern. ('179 patent at 1:50–53)

III. LEGAL STANDARDS

A. Motion to Dismiss

In order to survive a motion to dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6), “a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). A claim is facially plausible when the factual allegations allow the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. See id. at 663, 129 S.Ct. 1937. The court “must accept as true the factual allegations in the complaint and all reasonable inferences that can be drawn therefrom.” Nami v. Fauver, 82 F.3d 63, 65 (3d Cir.1996). However, the court “need not accept as true threadbare recitals of a cause of action's elements, supported by mere conclusory statements.”Iqbal, 556 U.S. at 678, 129 S.Ct. 1937.

“In deciding a Rule 12(b)(6) motion, a court must consider only the complaint, exhibits attached to the complaint, matters of public record, as well as undisputedly authentic documents if the complainant's claims are based upon these documents.” Mayer v. Belichick, 605 F.3d 223, 230 (3d Cir.2010). A court may also take judicial notice of the prosecution histories, which are “public records.” See Hockerson–Halberstadt, Inc. v. Avia Group Int'l, Inc., 222 F.3d 951, 957 (Fed.Cir.2000) ; see also generally Lum v. Bank of Am., 361 F.3d 217, 222 n. 3 (3d Cir.2004).

The Court of Appeals for the Federal Circuit has stated that to grant dismissal of a patent infringement suit at the pleading stage for lack of patentable subject matter, “the only plausible reading of the patent must be that there is clear and convincing evidence of ineligibility.” Ultramercial, Inc. v. Hulu, LLC, 722 F.3d 1335, 1339 (Fed.Cir.2013), cert. granted, judgment vacatedsub nom. WildTangent, Inc. v. Ultramercial, LLC, ––– U.S. ––––, 134 S.Ct. 2870, 189 L.Ed.2d 828 (2014) (emphasis in original). Subsequently, the Supreme Court vacated and remanded the Federal Circuit's decision in Ultramercial for further consideration in light of the Supreme Court's ruling in Alice Corp. v. CLS Bank Int'l, 573 U.S. ––––, 134 S.Ct. 2347, 189 L.Ed.2d 296 (2014). See WildTangent, 134 S.Ct. at 2870. Therefore, Ultramercial no longer has precedential effect. See Cnty. of Los Angeles v. Davis, 440 U.S. 625, 634 n. 6, 99 S.Ct. 1379, 59 L.Ed.2d 642 (1979) (“[O]ur decision vacating the judgment of the Court of Appeals deprives that court's opinion of precedential effect.”) (internal quotation marks and...