Federal Circuit – Non-Naturally DNA Patent-Eligible

18 October 2012 Personalized Medicine Bulletin Blog

On October 10, 2012, two pro-life groups petitioned the U.S. Supreme Court to review and reverse the U.S. Court of Appeals for the District of Columbia Circuit Court’s decision allowing the continued federal funding of research involving human embryonic stem cells (“hESCs”). A review of the history of the case can be found in our prior posts of August 27, 2012 and July 28, 2012.

Questions Presented

Two questions were presented to the Supreme Court for review:

“1. Whether the Court of Appeals erred in holding that an Executive Order can and did excuse an agency’s failure to comply with the Administrative Procedure Act.

2. Whether the Court of Appeals erred in holding that a preliminary injunction-ruling is binding law of the case, contrary to this Court’s settled rule that ‘the findings of fact and conclusions of law made by a court granting a preliminary injunction are not binding at trial on the merits.’ Univ. of Tex. v. Camenisch, 451 U.S. 390, 395 (1981).”

A Brief History

On March 9, 2009, President Barack Obama’s signed an Executive Order that overturned the previous administration’s policy banning the use of federal funds for research using embryonic stem cells created after August 9, 2001. (Removing Barriers to Responsible Scientific Research Involving Human Stem Cells, Executive Order 13505, 74 Fed. Reg. 46, 10667 (March 11, 2009)). Soon thereafter, a group of plaintiffs filed suit challenging the NIH’s authority to issue the 2009 NIH Guidelines (“Guidelines”) that implemented President Obama’s 2009 Executive Order. Plaintiffs argued that legislation known as the Dickey Amendment or the Dickey-Wicker Amendment bans the use of federal funding to support research involving human embryos. Congress originally passed this legislation in 1996, and former President Clinton signed it into law. The Dickey Amendment prohibits the Department of Health and Human Services (HHS), which includes the NIH, from funding research where human embryos are destroyed. Congress has included the Dickey Amendment in every subsequent HHS appropriations bill without substantial alteration. In subsequent years, the rider was enacted in Title V (General Provisions) of the Labor, HHS, and Education Appropriations Act. 

On August 24, 2012, Judge Sentelle of the Court of Appeals wrote the opinion under review. Judges Henderson and Brown wrote separate concurring opinions. The court held that the 2009 Guidelines do not violate the Dickey Amendment because in deferring to the defendant’s interpretation of the Dickey Amendment, the research funded by the NIH did not include the banned destruction of human embryos. The court also indicated that the NIH had authority to interpret the Dickey Amendment under a doctrine known as “Chevron” deference. Chevron U.S.A., Inc., v. Natural Resources Defense Counsel, Inc., 467 U.S. 837, 843 (1984). Under Chevron, a court must first ask whether Congress has directly spoken to the precise question at issue and if it has, a court must give effect to the unambiguously expressed Congressional intent. If however, such as the court determined here, the statute is silent or ambiguous with respect to the specific issue, then the court must defer to the agency’s (in this instance the NIH) interpretation provided it is based on a permissible construction of the statute. Under the NIH’s interpretation, the court noted, the Dickey Amendment permits federal funding of research projects that utilize already-derived hESCs – which are not themselves embryos – because no human embryo or embryos are destroyed in the funded projects.

Judge Henderson concurred with Judge Sentelle but disagreed that a Chevron review is applicable because Congress did not unambiguously delegate to the NIH the authority to interpret the Dickey Amendment. In addition, she wrote that the Dickey Amendment is not under the NIH’s area of expertise. Judge Henderson also wrote that the current panel, however, was bound to an earlier decision and therefore concurred with the majority opinion. Judge Brown agreed with Judge Henderson, but on the ground that the lower court’s holding did not rise to the level of clear error under which the district court’s decision could be vacated

The Alleged Errors at the Court of Appeals

The petitioners argued that the dispute is meritorious of Supreme Court review because the Court of Appeal’s holding embraces a fundamentally mistaken view of executive power and authorizes the president to exempt agencies from the Administrative Procedures Act (“APA”) at will. The petitioners argued that the Court of Appeals erred in relying on Executive Order 13505 to excuse the NIH’s refusal to address numerous comments that it received in promulgating Guidelines for federal funding of the research. The Court of Appeal’s decision was further argued to contradict with other circuit court decisions on the same issue.

The petitioners also argued that the Court of Appeals erred when it relied on the law of the case doctrine where the prior decision was rendered at the preliminary injunction stage of the proceedings. That holding, the petitioners submitted, contravenes Supreme Court precedent and deepens already existing confusion among the circuits regarding the scope of the law of the case doctrine.

Not Yet Over

Thus it appears that, at least for the time being, the dispute among U.S. researchers in the field of adult stem cells, pro-life groups, the Secretary of Health and Human Services, and the Director of the National Institutes of Health (NIH), is not yet over – at least in the courts. Should the petitioners fail to garner the Supreme Court’s attention or should the Supreme Court affirm the Court of Appeal’s decision, petitioners could continue to fight their battle in Congress by supporting specific legislation to ban the use of federal funding for human embryonic stem cell research.

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