If You License A Patent, Does That Mean You Think It's Valid?
from the important-cases dept
Earlier this year, we noted some of the important patent law cases the Supreme Court (surprisingly) decided to hear this session. One of them, MedImmune v. Genentech presented arguments to the court yesterday. In the case, MedImmune licensed a patent from Genentech that they felt was invalid. However, to avoid being sued, they felt it best to just license the patent, and then deal with the validity issue later. They later sued to invalidate the patent, but the lower courts basically said that MedImmune can't sue, because there was no breach of the agreement. Effectively, they said, by licensing the patent, MedImmune was saying it was a valid patent. There are a few different issues at play here, including the system in place to challenge a patent. With MedImmune, they waited until their own drug was successful, meaning that their payments to Genentech were high. Some might say this just shows they want out from under those payments, but a better explanation would be that it wasn't worth the expensive fight over the validity until it was shown to be a material issue for MedImmune. Still, at least from one of the questions the Chief Justice asked, it looks like the eventual ruling may not touch on the patent system at all, but rather focus on the contractual side of things. That is, if MedImmune was unsure of the validity of the patent, they could have put into the contract some sort of language that made it clear the deal did not limit their ability to question the validity at a later date. So, in the end, the lesson may simply be to write your contracts better -- and we won't actually learn very much about whether licensing a patent is a fundamental admission that you believe it's valid.