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Roche wins as high court limits university patent rights

June 6, 2011

The U.S. Supreme Court, in a ruling that limits the patent rights of research universities, threw out Stanford University’s suit against a Roche Holding AG unit over methods for testing the effectiveness of AIDS treatments.

Monday's decision is a victory for companies that collaborate with universities in research. Indianapolis-based Eli Lilly and Co., Intel Corp., Johnson & Johnson and Pfizer Inc. were among the companies that supported Roche, the world’s largest maker of cancer drugs.

Voting 7-2, the justices upheld a lower court’s conclusion that a scientist working at Stanford in Palo Alto, Calif., transferred his rights to the discoveries to a company whose line of business Roche later bought. Under the court’s reasoning, the transfer made the company a co-owner of three disputed patents.

The ruling is a blow to universities, which had contended the transfer was barred under a U.S. law that governs federally funded research. Universities said earlier that a ruling favoring Roche might cast doubt on patents stemming from hundreds of billions of dollars in research.

The dispute turned on a 1980 law that allocates patent rights among the government, investors and institutions that receive federal money. Writing for the court, Chief Justice John Roberts said that law didn’t displace the longstanding principle that inventors have first claim to their discoveries.

“Although much in intellectual property law has changed in the 220 years since the first Patent Act, the basic idea that inventors have the right to patent their inventions has not,” Roberts wrote.

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