Nov 18 (Westlaw Journals) The U.S. Supreme Court has agreed to decide whether a federal law pertaining to government contractors’ patent assignment rights barred a Stanford University researcher from assigning his rights to a third party.

In its petition for certiorari Stanford said the U.S. Court of Appeals for the Federal Circuit was wrong when it said no.

Opposing Stanford is Roche Molecular Systems, which says the Federal Circuit correctly decided that the Bayh-Dole Act, 35 U.S.C. § 200, did not bar the assignment.

The 1980 law gave U.S. universities, small businesses and nonprofits control of any inventions and other intellectual property arising from government-funded research.

Under Bayh-Dole a “university may elect to retain title to any subject invention.”

The case before the Supreme Court involves the respective rights of Stanford, university researcher Mark Holodniy and Roche and the effect of the Bayh-Dole Act on those rights.

In its petition for review Stanford said the patents at issue relate to methods for evaluating the effectiveness of HIV therapies.

Holodniy, one of three Stanford researchers named as inventors on the patents, joined Stanford in 1988.  He signed an agreement at the time under which he would assign any of his inventions to the university.

A year later, while still working at Stanford, Holodniy collaborated with biotech firm Cetus.

Holodniy signed a “visitor’s confidentiality agreement” with the company under which he agreed to assign to Cetus his right to inventions created through his work with the firm.

After completing his work with Cetus, Holodniy and his colleagues, with the help of funding from the National Institutes of Health, conceived and reduced to practice the methods for which Stanford subsequently obtained three patents.

Roche bought Cetus in 1991 and began manufacturing HIV detection kits.

In 1995, after obtaining its patents, Stanford sued Roche in the U.S. District Court for the Northern District of California, alleging that the HIV kits infringed its patents.

Roche answered and counterclaimed against Stanford, asserting that the university lacked standing to maintain the cause of action and claiming rights in the patents through its acquisition of Cetus.

The District Court ruled that Stanford had standing to sue based on its agreement with Holodniy and under the Bayh-Dole Act, which gave the school ownership of the patents because they resulted from federally funded research.

On appeal, the Federal Circuit reversed.

The appeals court said the agreement that Holodniy signed with Cetus ultimately conferred Roche ownership rights that defeated Stanford’s standing to sue.   

In its certiorari petition Stanford said the Federal Circuit ignored the clear mandate of the Bayh-Dole Act.

Roche argued the case is merely a contractual dispute not worthy of the court’s consideration.

The Supreme Court granted review Nov. 1.  Oral argument has not yet been scheduled.

Petitioner’s counsel is Ricardo Rodriguez of Palo Alto, Calif.

Respondent’s attorney is Brian C. Cannon of Quinn Emanuel Urquhart & Sullivan, Redwood Shores, Calif.

Board of Trustees of Leland Stanford University v. Roche Molecular Systems Inc. et al., No. 09-1159, cert. granted (U.S. Nov. 1, 2010).