Supreme Court rules confidential sales of inventions bars patents News
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Supreme Court rules confidential sales of inventions bars patents

The US Supreme Court ruled 9-0 on Tuesday that the sale of inventions in confidential arrangements count as the invention being “on sale.” As such, these inventions are excluded from patents filed after the sale date.

This case came before the court because Helsinn Healthcare S. A. uses palonestron to create chemotherapy-induced nausea treatments. This company entered into distribution, marketing and sales agreements that required confidentiality regarding proprietary information. Helsinn subsequently filed a series of patent applications over an approximately ten year period.

Teva Pharmaceuticals wanted to market a generic palonosetron product in 2011. Helsinn sued based on patent infringement. Teva argued that a provision of the Leahy-Smith America Invents Act excludes patents for inventions that are “in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.”

Helsinn’s sale of their invention to a third party, despite its requirement for confidentiality, is equivalent to being “on sale” as described by the Leahy-Smith America Invents act. As a result, Helsinn should have been barred from receiving a patent after its sale.