The U.S. Supreme Court ruled 7-2 Monday that Stanford and biotechnology giant Roche Holdings AG must share the rights to patents that describe an HIV-screening method, concluding in favor of the biotech firm a legal battle that lasted almost a decade. The ruling upholds a decision made by the U.S. Court of Appeals for the Federal Circuit in 2009.

Writing for the majority, Chief Justice John Roberts said the law did not alter the longstanding idea that inventors have first claim to their discoveries. It “has long been the rule that inventors have title to their patents initially, even if they make those inventions while working for somebody else,” Roberts said.

The case stemmed from a dispute between the University and Roche over patent royalties. The screening method protected by the patents in question are the fruit of School of Medicine professor Mark Holodniy’s research and is incorporated into HIV test kits sold by a Roche subsidiary. Stanford sued Roche in 2002, arguing that it was entitled to all royalties from the products.

The origins of the dispute date back to 1988, when Holodniy came to Stanford as a postdoctoral fellow. He signed a contract “agreeing to assign” rights to his potential future patents to the University, which is standard practice at most research institutions. The next year, he began conducting research on polymerase chain reactions (PCR), which would become the technology central to his screening method, at the early biotech firm Cetus Corp. Before being allowed to work there, he signed contract granting Cetus rights to his future inventions that stemmed from its intellectual property.

Roche bought the patents for PCR, the technology central to Holodniy’s screening method, from Cetus in 1991. They expired in 2006.

The ruling partially hinged on a wording technicality in the contracts: Roberts noted that Holodniy promised in the Stanford contract to assign his rights at a future date, meaning that the Cetus took priority over transfer of patent.

The University argued that the Bayh-Dole Act, a 1980 law governing the assignment of patent rights for institutions that receive federal funds, superseded Holodniy’s agreement. Since the federal government partially funded Holodniy’s research on the HIV technology, Stanford argued that the law – which, in most cases, grants the patent rights covering federally-funded inventions to the institution where the technology was developed – prevented the transfer of patent rights to Cetus.

–Tyler Brown