Final outcome of genetic cattle patent case likely in coming weeks

Beef Central, 15/02/2018

The final outcome of a Federal Court challenge to the granting of a patent to two US companies for genetic cattle selection methods in Australia should be known in coming weeks.

Meat & Livestock Australia and Dairy Australia are appealing through the Federal Court of Australia a 2016 Australian Patent Office decision to grant a patent application for cattle selection methods to Cargill USA and Branhaven LLC.

In a written judgement handed down last Friday, Honourable Justice Jonathan Beach gave the patent co-applicants 14 days to return with amendments improving the clarity of their application.

The basis of MLA and Dairy Australia’s challenge surrounded whether the alleged ‘invention’ the applicants were seeking to patent was patentable subject matter. MLA and Dairy Australia’s legal team asserted, among other things, that the patent application fell short of the requirements of inventiveness, novelty and utility (‘usefulness’), as required by the Patents Act 1990.

Justice Beach said he found that the evidence provided by MLA and Dairy Australia failed to establish that the invention as claimed in the patent application did not involve any inventive step, failed “to approach even satisfying” the high threshold for establishing grounds of a lack of novelty, and did not establish that the method would not achieve a useful result.

However the judge said he upheld MLA’s appeal to the extent that “aspects of the claim were deficient” in terms of lack of clarity and a failure to define the invention.

“Accordingly I would uphold MLA’s appeal to this extent,” Justice Beach wrote last Friday.

“But otherwise I would dismiss MLA’s appeal.”

Cargill USA was a co-applicant on the original patent application with Branhaven, a little known company reported to be a ‘private holding company’, in 2003. The legal firm that was acting for Branhaven at the start of this Federal Court of Australia appeal process has since told Beef Central it is no longer acting for Branhaven, as its legal fees had not been paid.

Cargill indicated at the start of the appeal process it would not be seeking to contest the appeal against its patent application appeal.  The Justice noted in his judgement that only Branhaven LLC had actively resisted the present appeal.

Justice Beach said he will not make final orders until Branhaven LLC has the opportunity to consider whether to amend its claim to address the lack of clarity concerns he expressed in his judgment.

He gave Branhaven LLC 14 days from last Friday to make amendments to its claim.

The highly technical nature of the case is highlighted by the specific amendments the Jusitce has asked the applicants to make:

“(a)    define “associated” in terms of statistical significance at the p value of equal to or less than 0.01 (or such other measure as I decide after hearing from counsel further);

(b)    require each of the 3 SNPs (Single Nucleotide Polymorphism) to satisfy that level of statistical significance (to be discussed further with counsel); and

(c)    require the limb (b) SNP to be in LD (linkage disequilibrium) with the relevant limb (a) SNP and to the requisite degree (to be discussed further with counsel).”

The Justice indicated that these amendments would satisfy his concerns.

“If the appropriate amendments are made, then the conclusions of lack of clarity, lack of definition and the residual aspect of lack of utility that I have reservations about fall away.”

In May 2016 Australia’s Commissioner of Patents, IP Australia, granted a patent application by two US based companies, Branhaven LLC and Cargill USA.

The companies were seeking to patent, in Australia, methods for identifying carcase traits – fat thickness, retail yield, marbling, tenderness and daily gain – of cattle from a single nucleotide polymorphism (SNPs) sample of a subject.

The ‘invention’ the applicants are seeking to patent is described in general terms “as providing methods, compositions and systems for managing, selecting, breeding and cloning cattle utilising information regarding genetic diversity among cattle, particularly and the effect or potential effect of nucleotide occurrences of SNPs on important traits”.

The method is designed to determine the genetic potential of individuals for a broad range of economically important traits at a very early age, their co-application said:

“This invention allows the identification of animals that have superior traits that can be used to identify parents of the next generation through selection. These methods can be imposed at the nucleus or elite breeding level where the improved traits would, through time, flow to the entire population of animals, or could be implemented at the multiplier or foundation parent level to sort parents into most genetically desirable.”

The application says the ‘invention’ being patented involves the construction of a high density bovine SNP map, an associated study to identify bovine SNPs in the map associated with various traits, and a study to determine a distance over which a degree of Linkage Disequilibrium is able to be established.

MLA opposed the initial patent grant application by IP Australia, but its opposition was unsuccessful.

IP Australia said MLA’s opposition had “failed on all grounds, save for one ground of lack of clarity and an aspect of “manner of manufacturer” concern affecting one claim of the patent application”.

In late 2016 MLA and Dairy Australia launched proceedings in the Federal Court of Australia to appeal the decision by the Commissioner of Patents to grant the application to Branhaven LLC and Cargill USA.

MLA and Dairy Australia’s view is that the scope of the patent application is so unclear and broad that it would inhibit genomic selection for all cattle production traits in Australia.

The cattle organisations argued in the Federal Court that the patent would impact on the industry’s ability to continue to use standard cattle genomic tools.

They said the broad nature of the claim would discourage or hamper future industry research into the natural genetic makeup of cattle and the continued progress of Australia’s national genetic improvement programs.

MLA/Dairy Australia’s “principal attack”, as described in the judgement, was that, among other things, the alleged ‘invention’ in the patent application was not a manner of ‘new manufacture’, and not the proper subject manner of a patent, because the claims were to known methods that use gene sequences that are naturally occurring. The claims were also include gene sequences that were yet to be discovered, identified or created.

The “indeterminate scope” of the claims would prevent or hinder research and development of methods to identify or infer traits in bovine subjects using SNPs, contrary to public interest, the MLA/DA team argued.

They said the patent application makes clear that all the inventors did was to discover naturally occurring bovine SNPs and create a high density map of the bovine genome based on SNP markers and discover naturally occurring associations.

They contended the methods used to create the map and the creation of the map itself did not involve any invention, and there was nothing new in constructing a high density genetic map using SNPs, and was created using the same techniques that had been used to sequence the human genome.

However, Justice Beach rejected these arguments.

He said the issues in the application were more within the field of a “molecular geneticist” rather than a “quantitative geneticist”.

He noted that each of MLA’s experts were quantitative geneticists who did not have significant direct experience in undertaking laboratory work in the application of molecular genetic techniques, including the molecular genetic techniques disclosed in the patent application.

On the other hand, Branhaven used two molecular geneticists and a quantitative geneticist, he said.

“On the question of molecular genetics, I have generally preferred the evidence of Branhaven’s witnesses concerning SNP mapping and identifying SNPs.”

He said however that MLA had had some success on some questions of construction and associated grounds dealing with lack of clarity of lack of definition.

In a statement released last Friday, Meat & Livestock Australia said it welcomed the Federal Court decision, saying it amounted to Branhaven LLC and Cargill USA being required to “wind back the broad scope of their Australian patent application for cattle selection methods”.

Branhaven had been represented earlier in the case by the Sydney office of global law firm K & L Gates.

However when contacted by Beef Central this week K & L Gates partner Simone Mitchell said the firm was no longer representing the company.

“K&L Gates is no longer acting for Branhaven in this matter as our fees and the fees of retained counsel have not been paid,” she advised.

“K&L Gates has issued proceedings against Branhaven LLC in the Victorian Supreme Court and has obtained a freezing order over the Patent, any award of costs made in favour of Branhaven in the Federal Court proceeding and the proceeds of any damages awarded in favour of Branhaven for infringement of the Patent.”

It is understand another legal firm is now representing Branhaven LLC. Beef Central has asked the new counsel if Branhaven LLC plans to amend its application but was yet to hear back at the time of Beef Central’s daily news email being sent out today.



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