Breeding for A2 Cows

Breeding for A2 cows should be easy.  And it is, as long as breeding bulls are typed for their A1 and A2 status.  In New Zealand, where I come from, all our dairy breeding bulls used for artificial breeding are genetically typed for their A2 status. Also, most Australian dairy breeding bulls are typed for their A2 status.  But in most other parts of the world this is not yet the case. It is a great frustration to me that A2 Corporation claims testing patents in most parts of the developed world, but is neither offering the service themselves, nor licensing others to provide the service.  I consider this an unacceptable situation.

Back in 2007 I presented a paper at the International Farm Management Conference in Ireland on breeding for A2 cows.  The paper is attached here:  a2 breeding paper

Keith Woodford
Professor of Farm Management and Agribusiness
Lincoln University

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About Keith Woodford

Keith is Honorary Professor of Agri-Food Systems at Lincoln University, New Zealand. He combines this with project work and consulting in NZ and beyond.
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29 Responses to Breeding for A2 Cows

  1. Edward Miller says:

    Breeding cows for A2 status

    From the your book many farmer’s do not retain the progeny from their cow’s first mating because the genetic quality is likely to be worse than those from artificial insemination.

    However, I understand some herd owners make their first insemination from smaller breeds selected for size so that that there will be fewer problems in delivery.

    The Dexter is apparently sold for this purpose, but if you have Holstein’s possibly there would be a case for using Jersey’s or Guernsey’s. All three breeds have a high fraction of A2/A2 apparently and it should be possible to acquire A2/A2 semen or a young bull to run free with the heifers. If this was done there would be both the benefit of easier delivery and the possibility of having A2/A2 animals that could be incorporated in the herd. A diary owner doing this could acquire cheaply an option for a faster conversion. Only sometime after birth would be need to make the decision on whether to add the offspring to his herd, or to sell for meat. I am not an expert on cattle genetics so I may be over my expertise here.

    While the Dexter is the one I have read as being used for this, it is a dual purpose breed and the offspring would probably be poorer additions to a dairy herd, although if under sufficient pressure doing so might be a smart move. Both the Guernsey and Jersey are dairy breeds. As I understand it, they have very good yields per pound of feed (but less per cow) and could probably be incorporated into a herd with little loss of profitability. I gather the Low line (small Angus) has been used for such breeding to dairy cows, but would appear less suitable for producing an option to A2/A2 herds even if a A2/A2 bull was used.

    I know there is a miniature Jersey breed in existence. (http://www.miniaturejerseyassociation.com/index.htm), but the literature on their web site suggests they are being marketed as pets and home cows rather than for the above application. I notice no milk production figures are given. The history given claims these are more likely the original Jerseys than the current Jerseys. I suspect that the smaller animals that had survived until someone decided to create a breed had not been the subject of an aggressive breeding program or a breed improvement one. As a result I suspect they may not have the best milk production per pound of feed. I saw no reference to them being used for the first mating of heifers. However, they may be suitable for that purpose and with the added merit of providing an option of rapid A2 conversion, there may be a market here for them.

    I do not know if there is a miniature Guernsey breed. If not, if may be possible to search the registries for smaller animals. Alternatively, a search may show some herds where the earlier, smaller animals have continued and which could be used as foundation stock for this purpose.

    It might be wise for breeder’s to position themselves now for this market. This might merely mean selecting suitable bulls (small size now, good pedigrees, etc.) and making sure that enough of their semen was used in cows to build a record so that it could later be sold if the market emerged.

    If the goal is merely to bring a cow to lactation, and it is expected that the calves will not be retained for the herd, the first mating should be with a bull that will produce good meat animals, rather than future dairy cows. Thus, breeding to have the early conversion option might call for breeding animals whose offspring not only make for easy and early deliveries, but for high milk production and other qualities wanted in a diary cow. I assume small size makes for both an early delivery (early start of lactation) and for easy delivery. If time permits, breeding could be for the first mating market (some of the males born are selected as breeding bulls for another generation.)

    • Keith Woodford says:

      Edward; There are lots of options for breeding from heifers and I am cautious of making general suggestions, as the best option varies from farmer to farmer, country to country, and situation to situation. There is no doubt that artificial insemination of heifers is important if farmers want to maximise the conversion to A2. But in my country ( NZ) , the heifers are often raised on what we call ‘dairy support’ land which is distant from the main farm (which is referred to as the ‘milking platform’). So sometimes it is more convenient to simply use a real bull. For those who are using artifical insemination, it should be possible to find a bull who is both A2A2 and ‘daughter proven’ as producing small calves.
      A couple of years back I visiited a farmer in Western Ausralia who was purposely breeding easy care and very small Jerseys, which he was feeding on irrigated Kikuyu grass.. His unconventional strategies were producing impressive levels of physical and financial performance, which demonstrates that size is not everything
      KeithW

      • Edward Miller says:

        It is nice to know this Western Australian farmer was making it with miniature Jerseys. From the web sites I found, it appeared sellers of miniature Jerseys were not talking abut things like gallons of milk produced, or pounds of protein or milk fats, but about the personalities etc. of the cows and their suitability as “pets” or family cows. This suggested to me that they lacked productivity figures that could be boasted about, such as you see in descriptions of bulls for breeding the main breeds.

        Are miniature Jersey’s available whose A1/A2 status is known? Finding A2/A2 miniatures that could be put with the new cows on the “dairy support” land would be key to acquiring an option for a fast conversion. The offspring cold be raised for some months before it was necessary to decide whether to add them to the herd (if there is a way to sell nonA1 milk at a premium. Otherwise, they would go into the meat market . Am I off the wall in suggesting this?

        I understand “For those who are using artificial insemination, it should be possible to find a bull who is both A2A2 and ‘daughter proven’ as producing small calves.” Is finding such a A2A2 bull who is daughter rpoven difficult if the bull is to run with the cows. If it is, would going to different breeds such as a Channel Island breed for Holsteins or a Miniature Jersey make finding a suitable bull easier.

        What about my idea of using regular A2/A2 Jerseys or Guersey bulls in the “dairy support” areas for Holstein types so there would be A2A2 cows (even if not quite as high producers) available if it was decided to cull the cows carrying the A1 gene.

      • Keith Woodford says:

        Edward;
        Reliable daughter proving of bulls can only be done through artificial insumination where the bull’s semen is used in multiple herds.
        Yes, Holstein farmers in NZ could use Jersey semen across their heifers and sell the progeny at a profitable price, but I cannot comment for other countries. This would work in NZ because farmers are use to using ( and hence purchasing) crossbred animals. In other countries that may not be the case. Most farmers would not consider using Guernsey semen in NZ as it is only a very minor breed.
        I know nothing of the A2 status of miniature Jerseys.
        KeithW

  2. Edward Miller says:

    There is a widespread impression that A2 Corp. has the key US patent on testing cows to discover if they produce A1 or A2 beta casein. This impression is left by Woodford in Devil in the Milk. After reading what appears to be the key US patent, I do not believe they have a US patent on the usually used version of this test. The reasons are a few paragraphs below.

    How could Woodford and others make this mistake (if it is a mistake)? At start up,A2 Corp. probably stated, or left the impression they had rights to the A1/A2 test, perhaps stating they had applied for a patent on it. A new biotechnology start-up tries to persuade investors they have a strong patent position.

    Until a US patent is actually issued, no one knows what it will cover. It often takes years to get a patent issued. A key patent US patent is 7,629,119, which was issued December 8, 2009. This is after Woodford wrote his book and after most of the articles discussing A2 Corp. were published. There is no way Woodford could have known what would be in the patent when issued.

    If you search the US applications data base there is under serial number 515941 a patent application listing many claims, with the original application date May 23,2003. This version lists the claims each with a number. It start with 1-25. (canceled). What this means is that they made 25 claims (variations they wanted to be covered by their patent) which were no longer included. This usually happens when the Patent Office Examiner looks at the claims and decides they do not qualify. Most likely these include the direct method of examining the DNA to see if it will produce a beta casein with a proline at position 67 or a histidine, and related variations.

    My guess as to why these might have been denied is that they were too obvious to be patentable. I asked a relative who had a couple of courses related to genetic testing but lacks a job, and he described how this test might be done. It was roughly what I would have done. If someone (not brilliant enough to get a job quickly) immediately realized how to do a test, that method does not meet the legal requirement for merchantability.

    I think I have found the New Zealand patent relating to this (537363) which appears to be the issued version of the application they used to establish priority. This patent appears to cover the most obvious method for doing the genotyping, looking for marker within the gene of interest. My guess is they hoped to get a US version with the same claims and included them in the application. However, it appears they failed, since the US patent explicitly excludes using markers within the gene of interest.

    It is clear why A2 might not want it known that the final patent was much weaker than they expected and did not publicize it (of course, I could be wrong about what is covered or the best way to test for a1/A2 status and would like your opinions or that of someone who actually does genetic testing.) Just speculating, but one reason A2 is changing from being an intellectual property company to a fast moving consumer products company was a realization that at least one of their patents, when finally issued, was not what they expected.

    Why I Doubt the A2 US Patent Covers the Best Way to do the A1/A2 test

    In general, if you want to know if an animal has a particular allele (version of a gene) you test directly for that allele. This is the cheapest and most reliable approach (and one most would presume is being used by anyone who offers a test to tell if cattle are of the A1 or A2 type). However, I have found no statement that this direct method is impractical, or that A2 Corp. has a US patent that directly prevents its use (if the only purpose is to determine whether a particular animal is A2A2).

    There are several reasons for believing there is a direct method that is an alternative to the A2 Corporation’s US patented one. One is a general knowledge of genetic technology which implies there is a direct method.

    Another is various things said in the A2 US patent (see below).

    There is the method of directly looking for the gene of interest, which is apparently excluded from this A2 patent claim. They state “not by identifying the DNA of that gene,” which apparently is a possible method. The describe their method as serving ” or to at least provide a useful alternative to known methods”, which, of course, implies other methods are known.

    When applied to cows, if the question of interest is the presence of proline or histidine at a specific point in the protein, looking for the point in the genetic code that controls this seems the most efficient way. A2 in this US patent states, ” This difference is determined by substitution of the nucleotide adenine with the nucleotide cytosine at position 200 of the coding region of the .beta.-casein gene”.

    Frankly, if it can be determined if there is adenosine or cytosine at position 200, the problem has been solved directly, and their US patient does not seem to cover this direct approach. That there is a direct approach is implied by their statement that, ” Seminal genomic DNA was purified from cattle that were previously genotyped and shown to be either carriers of the A.sup.1 or A.sup.2 variant of the .beta.-casein protein.” Later they say” In addition to these SNPs, markers AC000069 and AC000070, that determine the identity of the milk protein variant .beta.-casein A or B, were also genotyped.” That they did this seems to imply that a direct approach works.

    That there may be other tests not covered by the A2 patent is suggested by several other firms offering a test or stating they have one.

    On the LIC web site they say “An example of recent work is the development of a genetic test to identify the type of casein protein a cow will produce in her milk.” LIC is the leading artificial insemination firm in New Zealand and is separate from A2 Corporation. If they developed such a test it appears to be different than the one that A2 Corporation took a patent on (or at least I find no reference on their web site to a patent or to a license from A2 Corporation). There is also the following statement on their site:

    “A2*
    Milking cows naturally produce a protein in their milking – beta-casein, which comes in two variants, A1 and A2. GeneMark offers an A2 production gene test to identify whether a particular animal carries the specific A2 beta-casein gene. Click here to find out more.
    * LIC does no endorse any claims related to A2 milk.”

    Genemark is apparently their subsidiary that does testing.

    There is another lab that offers the A1A2 test. Their test appears to be a direct one not covered by the A2 US patent. Their test is described on their web site as follows: (see http://www.genomnz.co.nz/Services/SingleGenesDairyCattle/tabid/75/Default.aspx#A2 )

    ” Research has identified a mutation or SNP (single nucleotide polymorphism) in the bovine DNA sequence that distinguishes the A1 and A2 protein variants. When animals have an adenine (A) nucleotide at position 200 of the Beta-casein gene the protein type is A1 or B, and when they have a cytosine (C) nucleotide, the protein type is A2 or (rarely) A3.
    The test identifies three classes of animal:
    A2/A2
    Where the beta-casein genotype is CC the animal will produce milk with an A2 or (rarely) A3 protein type
    A1/A1
    Where the genotype is AA the animal will produce milk with an A1 or B protein type.
    A1/A2
    Where the genotype is AC the animal has one allele of each type and will produce milk with a mixture of protein types.

    This test does not discount the presence of the rare beta-casein genotypes

    * Genomnz™ does not endorse any claims related to A2 milk.”

    No where do they say their test is certified by A2 Corp (unlike the Davis one), nor do they have any warnings about the intellectual property claims of A2.

    Nowhere do they state they will supply the results of the test to A2 corporation.

    Thus, one who is worried about A2 Corp getting the results of their test should be able to have the test done by GennomNZ in New Zealand. If they have infringed the A2 assigned US patent 7,629,119, A2 Corp is less likely to find out about it. However, the description of the test used by Genomnz appears to be a direct test that does not infringe on the above US patent (although it may infringe the New Zealand one). If it does infringe on the New Zealand one, I would assume they have a license from A2 to use it.

    • Keith Woodford says:

      Edward,
      You have raised important issues here.
      Unfortunately I cannot answer many of them but I encourage you to continue investigating the patent situation.
      I note that on p185 in ‘The Devil” I refer to the NZ genotyping patent. I say there that this patent was upheld in all important jurisdictions, including Europe and the USA. I am unable to recall the evidence I had for that statement. I am inclined to think that I accepted the word of someone from A2 Corp in that regard – I cannot think who else might have advised me on this point.
      Regardless of who might or might not have led me astray, it is worth noting that those patents as they have been applied at least in New Zealand have not had the rigorous langauge around the testing that is the case with the Davis testing protocols. In addition, I do recall very clearly being advised by an A2 Corp officer that their American patents were much stronger than those in NZ. However, I did not report that in ‘The Devil’ and that information would indeed have come to me after publication.

      However, I have always been surprised that A2 Corp patents were allegedly so strong in the USA. This surprise was in part because I believed there were published testing methods prior to any A2 Corp patents and hence any wide ranging testing patent could only apply to specific new purposes. Also, the orginal NZDRI/Child Health Foundation patent seemed to cover the purpose of testing for Type 1 diabetes (but not heart disease or other health conditions). However, any attempt to discuss this with A2 Corp officers has not been fruitful.
      I am also aware, as one wise person said to me some years ago in relation to exactly this matter, “a patent is somewhat like a shield; if at all possible one does not want to test it in battle”. I am also aware that the people who make lots of money out of patent disputes are the patent lawyers.
      Anyway, what I do agree with strongly is that there is a need for an independent person to review the patent situation and shed some light.
      Accordingly, if you decide to prepare such a report, and as long as it is prepared as an evidence-based opinion piece which doesn’t get either of us into trouble by impugning anyone’s integrity, I would be pleased to list it as a new post, and see what discussion it can generate.
      I will finish with some sentences from the final paragraph of ‘The Devil’.
      …the path of knowledge, and how that knowledge is communicated,is long and tortuous. Intellectual property rights to patents and trademarks, and how these might be interpreted in different jurisdictions, adds a further complication. Information, disinformation, and vested interests get inextricably intertwined.”
      I welcome the involvement of others in moving our knowledge forward.
      KeithW

  3. Edward Miller says:

    On reason I wonder if they really have a patent on the most feasible genetic test is that I had the impression from your book that the basic genetics was known early, before the health effects of different types of beta casein were known. This is that A1 and A2 beta caseins existed and that it was due to a certain gene and a certain allele of that gene. You probably have the articles on file and can see if that was so and what tests had been done by whom and when. If a genetic test was being used prior to A2, they could not have invented that one. Once the location of the gene (including is axons and introns was known) the nature of the mutation was probably known. I think this would make at least one test obvious to someone in the business (skilled in the art is the US patent term), making that test not patentable in the US.

    One reason you may have been told the US patents were among the more solid is that the US system provides for a more rigorous examination. At least at one time, some counties systems were essentially registries of claims to having invented things. Only the most obvious case of non-originality were thrown out, and the question of whether they really were the first to invent something was investigated only when it went to litigation. This “registration” system is cheaper to administer, since most patents are for ideas that are never put into use, and expensive efforts to go through lots of patents, old journals,. are not done.

    Also, because the US is such a big market, most inventions get submitted for patent there. Thus the US patent office can afford a large staff of experts, each of which handles only a small area of technology, where he can learn what is state of the art, and knows enough to know what would be obvious to the engineers or researchers in that area. Thus if something gets through them it is more likely to be really novel rather than a case where the patent was issued to someone who thought he was first, but where there was an earlier invention, evidence of which could come out in litigation.

    Incidentally, a detail of the US system is that priority goes to the first to invent, while I understand that in most of the world priority goes to the first to file. Thus the point you made that many applications are early because they are trying to be sure they file first is true of most countries, but is not true for the US. Even in the US you have deadlines, and in the case where the evidence emerges slowly that your invention works (say a claim to prevent a disease), it may pay to file early enough so you cannot be challenged on the basis that the real invention was made earlier and an application should have been made then.

    Something I know little of is the situation on A1/A2 outside of the US or Australia/New Zealand (where from your book and blog I know something). Are there countries in Europe or elsewhere where the issue is active or where A2 does not have blocking patents? Are there places where health claims are easier to make and hence it would be easier to market a non-A1 milk or milk product.

    Since both you and I have heard breeder’s saying they are unwilling to have their animals tested by A2 affiliated organizations because of fear of demands for license fees, possibly there is a lab somewhere that is free to do such tests, even if A2 does have valid patents in many places. Genetic testing techniques are well known, and skilled labs are all over the world. Samples of hair or other tissues are light, and firms like Federal Express can deliver all over the world. I could easily imagine A1/A2 testing could be profitable for a lab in Europe or elsewhere that took samples from around the world. Is the problem that I do not know of such labs, or do they really not exist?

    While doing a single test of a nature you are unfamiliar with is probably expensive, I suspect that once one has the right primers, and trains the staff this business could be profitable even at today’s low level of demand. If, as I expect, this issue will someday be much bigger, and there will be many farmers seeking the test. It would be smart for a lab to learn how to do the test now and try to acquire a reputation so that when the volume increases, it is not just another new entrant, but one that can say it has been doing the test for years. When customers look in directories, etc. for someone who can do it, this firm’s name emerges.

    At least in the US food scare tend to emerge suddenly and get much publicity with sales of the relevant product dropping quickly. An example of this in Europe is the E. coli scare, where apparently vast quantities of vegetables are proving unsalable.

    A concern I have is that when this happens there will be many farmers willing to convert, but testing will be a bottleneck. Such bottlenecks seem likely enough to me that I think it would be prudent for those for whom test results would be extremely valuable (those selling semen and breeding stock) to get their animals tested now. When they are deluged with requests for A2A2 semen, they should know which bulls have it and can respond with “yes, we have it.”

    Of course, if they know the A1A2 status of their bulls, they should mention this in their catalogs. This could lead to some farmer’s saying what is A1/A2 status and learning of the issue.

    I do not know how the U. of Cal. at Davis would respond if they were overwhelmed with orders. Would they just take them in order of receipt? Would bags of mail pile up, and one be picked at random to be worked on each day? One possibility is that since they are a California organization, someone would decide to give priority to orders from California (or various Californians with connections would get their orders put nearer the top of the list). I understand four of the top US semen suppliers are based in Wisconsin, and in such a scenario, it might be a while before non-California firms could get their bulls tested.

    Sending samples to New Zealand might be a possibility, but there may not be enough capacity there, and I could imagine priority going either to established customers (who would typically not be in the US) or to New Zealand firms. LIC is a cooperative, and I understand their first duty is to their members who I understand to be New Zealand herd owners, a category that probably excludes US semen providers, breeders, and farmers.

    The obvious implication is that those who can should get their breeding stock and semen providing bulls tested now. How do I get this idea to the relevant people? One possibility would be to persuade a firm offering the test to present the idea to the relevant animal owners (since they would make money from it).

    One firm is LIC but I do not know key executives there. Also, it may not be in their interest to have the major US semen providers have their bulls tested. One of their competitive advantage now is that they can provide A2A2 semen when most other firms cannot. I am presuming the semen they now are offering in the US is from New Zealand bulls whose A1A2 status is known. In the coming crisis I can imagine they might make a lot of sales quickly as herd owners search for A2A2 semen.

    I just hope that the New Zealand A2A2 bulls are virile enough so that they can take over inseminating all the cows in the US, and ideally in the world, at least until the testing labs dig out from under their piles of mail and test other bulls. Are they?

    • Keith Woodford says:

      Edward,
      I will touch on just some of your points.
      1) I believe that scientists knew that the alleles determining A1 and A2 status were on the sixth chromosome, and that it was a single gene, well before A2 Corp came on the scene.
      2. Accordingly, there was nothing novel about the notion of determining A1/A2 status by genetic testing.
      3. I note that the UC Davis test determines A1/A2 status but does not identify minor variants such as A3 or B. This would strongly suggest that they are testing only in relation to the one gene.
      4. I believe that at least some and possibly most semen companies in the US know the A1 and A2 status of their bulls but do not advertise this. But they can provide this information to a potential client if it is asked for.
      5. I am aware that some US farmers have sent samples to Europe for testing. I do not know who is doing the testing there, but I doubt that they are licensed by A2 Corp.
      6. US labs are unilkely to offer the test as long as there is uncertainty about patent infringement. From their perspective, it is not worth the risk.
      7. Accordingly, there is a need for a paper that sets out the legal issues. Although motivations of existing players are relevant to understanding the current situation, this needed paper should put the motivations aside and address only the legal and associated scientific issues.
      KeithW

    • Edward Miller says:

      General Issues in A2 Corp. patents

      Having look at the A2 Corp. patents in the US (similar issue probably arise in other countries although the patents may differ by country, and the underlying laws differ in ways I am not familiar with, several issues arise.

      A very general issue is that under US law scientific discoveries are not patentable, but inventions that use them may be if otherwise qualifying.

      The underlying discoveries are that certain types of beta casein appear to contribute to either Type 1 Diabetes (Elliot) or to heart disease (McLachlan). These appear to be important discoveries although the evidence is not complete, these are important discoveries and the inventors disserve credit. However, the applications appear rather obvious and I do not think should have been patentable under US law, although they have been. It is possible that in litigation these patents would not be upheld on this basis alone, or if someone requested a reexamination and paid the fees, these claims would not be supported.

      The implications that come from the discoveries and which were patented include:

      1. To reduce the risk of diabetes those susceptible should be restricted to drinking only milk of the type not containing the type of casein which creates a problem (Patent 6,451,368). It has been a general principle of nutrition that if a food is believed to contribute to a health condition and another food, or version of the same food does not, that the safer version should be consumed. The application to milk of different varieties appears too obvious to be patentable. One previous application is that spoiled milk should not be drunk.

      2. Another implication is that milk that does not contain (or contains very little) A1 beta casein should be preferred for use. Such milk can be detected by various tests (which A2 related inventors do not claim to have invented) and the more healthy version should be selected and then used either directly, or in milk products. This idea as an invention seems to be claimed in patent 6,451,368 for milk containing the type of beta casein A1 for diabetes. Again the basic underlying idea in nutrition and food technology is well known, and the application to different varieties of milk should not have been patented.

      The idea of selecting among foods on the basis of healthfulness is well known and is frequently applied. One well known application is that if bacterial contamination (or other contamination) makes one batch of food prone to contribute to a disease, that batch should not be selected for consumption or for incorporation in another food. As applied to to milk, it has been known for years, and most dairy farm operators routinely conduct various tests on milk (including visual inspection). If a batch of milk is found to be of the type that might contribute to a disease, it is not used for producing the final product, often milk for sale. Milk processors, including bottlers, routinely conduct tests (and are required to by law I believe) , and milk found to be of a type that may contribute to a disease are not used for bottling or to produce another product.

      The ideas, as an inventions, seems to be claimed in US patent 7157616 with regard to diabetes, and in patent 6570060 with regard to heart disease. Given the science, the application appears far too obvious to meet the requirement for patentability.

      3. If cows of different genotypes produces different types of milk, cows can and should be selected by the genotype (as determined by various known tests, not claimed to have been invented by those who discovered the disease related effects ) and used to produce the healthier type of milk. Patent 7157616 for diabetes and Patent 7157616 for heart disease, and Patent 7863002 for all uses of A2A2 status for selecting bovines, could be argued to be obvious.

      The technology of selecting by genotype to obtain specified phenotype is well known and frequently applied by animal breeders. If a certain genotype (A2A2) is known to result in a certain phenotype (cows capable of producing milk with little or no beta casein of the A1 type), selecting the desired animals (cows that produce milk with little or no A1 beta casein) on the basis of genotype (A2A2) is a obvious application that should not have received a patent.

      4. It may be desirable to use breeding techniques to produce A2A2 cows and bulls, including genetic tests to select bulls and cows. Patent 7,563,575 claims the idea of breeding for A2A2 status by mating certain types of bulls and cows.

      The basic techniques of animal breeding are well known, and include selecting animals by using genetic tests for genes predicting desired traits. Using the laws of Mendelan genetics to breed for desired traits is well established technology. In the application in question here it can easily be determined that a way to obtain A2A2 cows is through breeding A2A2 bulls with A2A2 cows.

      Is the subject matter of A2 patents Patentable?

      Several other issues exist. US law provides for patenting any “new and useful process, machine, manufacture, or compositions of matter.” There is not a machine or manufacture here. Thus they must be claiming a new composition of matter or a new processes.

      At first glance there may appear to be a new “composition of matter.” However, milk of the A2 beta casein type (and other minor types) has been produced for many years, since there are many A2A2 cows, each of which produce such milk. Once there were millions of small farmers with only one cow who produced their own milk and also sold some milk. Hence milk of the A2 type is a product that has already been put on the market, and is probably still available in the US. Since there are many farmers who will sell you milk from their cow, it is virtually certain that some of the are already offering milk of the A2 type.

      If they are claiming a new process that is merely selecting milk or cows for a desired property it appears too obvious to have been patentable.

      If certain patents relate to a process, it must not be a mathematical algorithm (since laws of mathematics cannot be patented). It might be argued that certain patents that involve selecting animals or milk are essentially algorithms. If certain conditions are met, the animal should be selected. Ones that say if A2 is present, but A1 is not, then select the animal, amounts to a simple algorithm for processing test data to discover if an animal is A2. This argument might destroy the latest A2 patent.

      Other patents that involve the step of select something if a test of either milk or DNA reveals the milk to be of the low in A1 beta casein type, or selecting a cow or bull by a similar rule might be argued to be mathematical algorithms (and rather simple ones at that), and hence the patent is invalid.

      How High Would Damages Be?

      If a patent is infringed there is the question of how high are the damages that might be collected. there are several possible theories, but in general the goal is to estimate the damages A2 Corp suffered, and make them whole.

      Damages from certain infringers may be too low to justify much in payments, regardless of the legal theory, I doubt if much could be gotten from the typical consumer, or a small farmer just because they do not have much money.

      A2 seems to have their strongest patent position against farmers since they have several patents that seem to cover breeding animals, or selling milk. Let us consider possible formulas for determining damages.

      One theory would be how much in profits did A2 lose from the farmer’s actions. Given that A2 seems to do no business in the US that might be harmed, it could be argued the damages would be low. A2 franchises do sell milk in New Zealand or Australia, and A2 might argue that the farmer’s action put these under competitive pressure that lower their ability to pay royalties. However, just how big a threat is competition from US milk to A2 bottlers in New Zealand or Australia? I suggest none.
      Alternatively, the A2 Corp. might take the position that a reasonable royalty for the farmer should be calculated on some other basis, possibly what the farmer’s milk would bring if he used the A2 patents and then had A2 type milk to sell, and what it would be if he did not (and hence had only regular milk to sell). Such calculations might be based on the going price for A2 type milk versus the going price for ordinary milk. In spite of a statement in the LIC catalog, I believe there are no buyers in the US currently paying a premium for milk from A2A2 cows. It does not appear A2 Corp. would win large damages on this theory either.

      Possibly A2 could argue that eventually they would have found a franchise holder and that the threat of competition from this farmer would make such a franchise less valuable and hence harder for A2 to recruit such a franchisor. However, given the failure of A2 to find a franchisee in the US recently (a earlier one went under), this sounds speculative and US courts do not like to award damage on the basis of mere speculation about what might happen in the future.

      It is also easy to argue that A2 would benefit from a US farmer getting his herd ready to sell the type of milk that an A2 franchisee might wish to buy. a problem for a potential franchisor will be finding farmers able to supply A2A2 milk or willing to convert their herds. If the farmer is trying to increase the proportion of A2A2 animals in his herd so that when an A2 franchisor appears he will qualify to supply milk. In this case A2 benefits from the farmer’s actions. It is hard to argue A2 has been hurt when it actually benefited.

      Admittedly, the farmer may merely be trying to get in position so that when the A2 patents expire he can sell his milk. In this case, the increased sales of A2 type milk comes after the A2 patents have expired so A2 or its franchisors have not been hurt.

      A2 strongest case would be if the farmer was supplying milk to a firm that offered an alternative to A2 branded milk. However, there seem to be no such firms and the failure of A2 to make their brand sell in the Us and the limited success in Australia and New Zealand suggests the emergence of such a bottler is unlikely. Courts are unlikely to give large damages (or any damages) on the basis of such speculations.

      A2 may find other theories to calculate damages. For instance, if a semen seller pays royalties to A2 on all sales of semen from certain bulls, but not others and the farmer’s infringement causes them to collect lower royalties, presumably the damages are calculable. If say the royalty was $1 per straw and the farmer order 10 straws, the damages could be S10. It should be clear that in litigation, the A2 Corp might win (or might not if it was shown their patent was invalid) and collect their $10 in damages. This would help a little in paying A2’s lawyer’s fee.

      However, if the semen supplier pays no royalties on any bulls to A2 Corp. (which I suspect is the case), it is not clear that that A2 has suffered damages in reduced income from a semen seller from an infringement.

      Thus, farmer’s may be fairly safe from owing large damages to A2 Corp.

      What about semen sellers? Some of the same arguments may apply to them. If producing A2 milk does not increase farmer’s profits much under current conditions, it is hard to argue that a fair royalty would have been high. A2 is not now selling semen so it would be hard to argue that they lose much in semen profits from competition from a firm that uses their intellectual property without paying them.

      I do not know what a fair royalty payment might be. If a semen seller could only offer A2A2 semen by using the A2 intellectual property (a proposition that can easily be argued against), damages might be estimated by making a generous estimate of the difference in price between semen from A2A2 bulls and other bulls. Looking at say the catalog of LIC Corp, it does not appear the A2A2 bulls are priced much above that of other bulls. This suggests the damages would be small.

      I can imagine circumstances where the difference in price between A2A2 semen and other semen would be larger. The strongest would be where a law prohibited selling an another type of semen. If there was a strong public concern about BCM7 in milk, there might be a price differential in favor of A2A2 semen. However, this is not the current situation in the US.

      It may be rational for semen sellers to prepare for such a situation after A2A2 patents expire by trying to assure they have many A2A2 bulls available whose progeny have been tested by actual production, and that there are enough quality A2A2 bulls available that concerns about genetic diversity do not proven a problem in making sales. If they have only one or two good quality A2A2 bulls, buyers may give only some of their A2A2 business to them.

      It is a real question whether much of the intellectual property of A2 Corp is needed to offer A2A2 semen. They do not appear to have a patent on all methods of discovering whether a bull is A2A2 which include its ancestry (the offspring of an A2A2 bull and an A2A2 cow will be A2A2) and several tests. The ones test they have a patent on uses markers not within the gene, and the best procedure appears to just look for markers within the gene.

      Several A2A2 patents deal with preventing diabetes or heart disease. These patents could prove a real problem in selling semen or even animals to institutions that kept their own cows and sought animals whose milk would contribute to reducing the risk of such diseases (including orphanages). However, there are few if any such institutions. Even if they were, if they bought semen or cows on the basis of the sellers statements as to whether they were A2A2, it would seem the supplier had not infringed.

      However, an orphanage worried about diabetes among its children that selected A2A2 cows for the farm that provided work and training for the orphans while supplying it with milk, might infringe a A2 patent. Personally, I would hate to be in charge of public relations for A2 Corp., the seller of A2 brand milk. Imagine the problem of explaining just why A2 Corp was bringing such a lawsuit, and why it wished to increase the risk of diabetes among the poor orphans.

      Their strongest patent appears to be the recent one on selecting anything on the basis of A2A2 status, but this does not appear to cover merely testing the animal and then publishing whether it is A2A2, as long as no selecting is done. It would appear that if some farmers use this information in deciding which semen to order, the semen seller has not violated their patent even if more semen from this bull is sold than otherwise would be sold. I know of other ways to avoid violating this patent also.

      By arguments made above, the availability of A2A2 semen may actually help the A2 franchisors when and if they appear in the US. In this case A2 could actually benefit and it would be hard to argue that A2 was owed large damages for actions that actually benefited them.

      A general issue with the A2 patent position is that it is strongest against vertically integrated firms that do everything from breeding animals to producing milk to using it. Paradoxically, a farmer who breeds his own animal using various genetic tests, produces milk of the A2AQ2 type and feeds it to his own family in hope of reducing the chance of type 1 diabetes will probably infringe several patents.

      However, only a very small fraction of the nation’s milk is produced and used within a single family (one source I have dated about 1994, suggests it is .3% of the US milk supply, and it is probably even less now).These cases are too small for A2 Corp to profitably bring many infringement cases against, even if they somehow were to learn of them.

      The one exception is where A2 company is trying to either win a case where the validity of the patent is at issue, or is trying to make an example of someone. If you want to point to a case where the validity of your patent was upheld, you may actually seek out an infringer who is not willing to spend much to discover prior art or to argue the case. Patent law is specialized and the typical small town lawyer is not experienced in such litigation. Of course those who produce milk just for their own consumption tend to be in rural areas. I could imagine being more likely to win a weak case against a small town lawyer who has been told to spend little time on a case than against a well financed big city team of patent lawyers.

      Also in cases where obviousness is an issue of have heard of lawyers trying to get an uneducated jury in the hope they would not find something obvious, because it was not obvious to them. Such juries may be more likely in rural areas.

      However, in this case I could see problems with a typical rural jury. I sure would hate to try to convince such a jury of “hicks” that ideas such as not mixing bad milk with good milk, or selecting an animal on the basis of a test, or of mating a bull and a cow together to get offspring with a desired trait were non-obvious and that someone skilled in mixing milk, operating a dairy, or animal breeding could not have thought of such ideas. They would lack the “education” needed to persuade them that such an idea was non-obvious, and might even disrupt the court proceeding with laughter.

      Also, if you were trying to get small payments from lots of small farmers, having brought one case might help you in persuading many others to pay up.

      Such tactics might be profitable for a “patent troll,” who try to make money off of weak patents by inducing firms to settle rather than fighting. Such trolls do not care about their reputation.

      However, if I had a brand of milk my franchisees were trying to sell, I would not risk adverse publicity from bringing such cases or from even threatening to do so.

      I know of a few other techniques that might be used to avoid infringing A2 patents, but this essay is already too long.

  4. Edward Miller says:

    There does appear to be one other test known, abstract below, which is claimed to be “cost-effective, fast, and sensitive.”

    I found this article cited in an research proposal by Libor Stehlík (Mendel University of Agriculture and Forestry in Brno) which included the following in a paragraph titled A2 Corporation, “A method for identifying A1 and A2 has been described (Barroso et al. 1999) and the company has the patent to test herds and so select for animals that will produce pure A2 milk.” Yet this method appears to be different from that described in the A2 US patent application. If it was the same I would have expected it to have been mentioned. I would also have presumed that the authors of this paper would be listed among the inventors if A2 was to have the rights to this test. Thus, I suspect some confusion on the part of Libor.

    His proposal describes several genotyping methods.

    He states ,”The PCR – restriction fragment length polymorphism will be used for testing of genotype in casein gene of new born cows. This method will be considered as the main and the most useful method for this research.” Earlier he had said “The homozygous genotype A1A1 produces fragment of 217 bp. The homozygous genotype A2A2 produces fragment of 177 bp.” This to me sounds like it could be a practical and economical method.

    Later he says, “The third method tetra-primer ARMS (amplification refractory mutation system) will be used for testing new born cows too. ” I believe this method is described in:

    Rincon G., Medrano J.F. (2003): Single nucleotide polymorphism genotyping of bovine milk protein genes using the tetra-primer ARMS-PCR. Journal of Animal Breeding and Genetics 120, 331-337.

    I did not immediately find a casein patent application in the US with the name of Rincon as the inventor, although he and Medrano do have a application for application for “SNPs ASSOCIATED WITH FATTY ACID COMPOSITION OF BOVINE MEAT AND MILK” showing they do use the US patent system.

    Thus, it is possible that either their method described above for genotyping for A1/A2 animals is in the public domain, or they felt it not worth patenting for some reason.

    The Libor proposal describes how for cows the proteins can be tested, which he describes saying ” but for testing producing cows is this method optimal. The main positive of gel method is low price for determination of genotype.” If patent problems are too severe this method is available.

    The above suggests to me that there are several methods that can be used for genotyping cows and bulls that could be used by someone concerned about not infringing A2 Corp. patents. Especially for semen producing bulls, one of the alternative methods might be worth using even if priced higher than the $25 charged at Davis.

    An interesting feature of this proposal is even though Libor is proposing to genotype cows and he states A2 has “the” patent, there is no reference to seeking a license from them.

    Journal of Animal Science, Vol 77, Issue 10 2629-2632, Copyright © 1999 by American Society of Animal Science
    ________________________________________
    JOURNAL ARTICLE
    Technical note: use of PCR-single-strand conformation polymorphism analysis for detection of bovine beta-casein variants A1, A2, A3, and B
    A. Barroso, S. Dunner and J. Canon
    Departamento de Produccion Animal, Facultad de Veterinaria, Madrid, Spain.
    We have optimized the polymerase chain reaction-single-strand conformation polymorphism (PCR-SSCP) technique to screen the most frequent variants (A1, A2, A3, and B) of the bovine beta-casein gene. Five partly overlapping PCR products (233, 234, 265, 466, and 498 bp) of Exon VII of the beta-casein gene that encompass the target point mutations were heat-denatured, separated on nondenaturing polyacrylamide gels, and silver-stained. Simultaneous detection of all variants in reference samples of known genotypes (A1A2, A2A2, A1A3, A1B, and A2B) was best achieved on 17% polyacrylamide (100:1 acrylamide:bis-acrylamide ratio) gels with the PCR product of 234 bp. These results were confirmed by sequencing the allele-specific SSCP bands directly excised from polyacrylamide gels. A population of 65 anonymous samples belonging to various breeds was then analyzed twice, without discrepancies in a blind trial. Routine beta-casein genotyping using PCR-SSCP is proposed as a cost-effective, fast, and sensitive technique.

    • Edward Miller says:

      If I understand the dairy cow semen business right, sellers of semen select certain candidate bulls and arrange for some of their semen to be used in inseminating cows and then records are kept of the milk output of these cows and various measures of quality. Other things may be recorded such as ease of giving birth, or possibly milk performance in later lactations, or the probability of becoming lame, etc.

      This seems like a long process with perhaps two years between when the first semen is sent out and when data is back on the quality and quantity of the firm milk production (you can probably be more precise with your knowledge).

      The period could be much longer if information is wanted on the second lactation, and the number of years the cow will be in use, or its lifetime milk production.

      If there is likely to be a shift in the market for semen towards A2A2 semen and semen from A1 A1 bulls will be harder to sell, it seems that semen producers and bull breeders should start the process mainly with A2A2 bulls, or at least bias the first steps of bull choice in that direction, and away from A1A1 candidates.

      Do the breeders of bulls and semen sellers see this coming and are they doing it. If not, they are taking a risk of ending up with hard to sell semen from A1A1 or A1A2 bulls.

      Thinking politically, I see legislation coming that forces restrictions on the sale of A1 type semen. Such legislation may be a compromise between health advocates that demand either restrictions on sales of A1 milk or warning labels and the dairy interests (or their representatives in Congress, state legislatures, or parliaments). As you point out, the costs to farmer’s would be low (and even lower for processors). The chief losers would be owner’s of certain bulls whose value would be decreased. If this is proposed, one can expect strong opposition from those with bulls whose semen would not qualify or who own stocks of frozen semen.

      This suggests a special effort to convince what I think is a small number of sellers of semen that there is a shift coming in the market and they should be prepared. I believe in the US much of the market is controlled by only about five firms. I think in New Zealand LIC controls much of the markets. I realize that those who market the semen may be different than those that own the bulls, but I know little of the details of this rather small industry.

      I do not know how high the cost for breeders of starting the testing process only with A2A2 bulls. I have a suspicion that for most breeds and their breeders there are so many high quality candidates that very little is lost by only considering the candidates who are A2A2 or the smaller breeds there may be too few promising bulls to restrict consideration only to A2A2 ones since that would lead to a too interbred herd and too many recessives genes matching up. For such breeds, it still might be possible to avoid the A1A1 bulls or to bias selection towards the A2A2 bulls. I understand this may have happened in one breed a couple of A1A1 have been sidelined. I won’t say which breed a the chance that the owner’s of the bulls are no aware of what happened and have suffered losses.

      For those of us whose interest is primarily altruistic and with limited time, these few breeders may be a logical target to get informed. Is it your impression that the major breeders are already aware of the issue or are there likely to some who have not thought that far ahead?

      The issue of control of test patents can come up here since I have been told A2 Corp. has been demanding royalties on sales of semen and breeders are reluctant to order tests from A2 licensed labs because a2 may go after them legally. You have said you think the major semen suppliers have somehow learned (probably by using labs not licensed by A2 Corp) which bulls are A2A2 and can answer questions by potential buyers if asked.

      If so, many of them probably have somehow found out which candidate bulls are of what type. However, testing the candidate bulls probably calls for more tests. It may have been harder or more expensive to get that many tests done without problems. Hence, it would be nice if there were known sources of testing that could be used. Even if the A2 Corp. patent position in the US is such that you have infringed if you select (key word) bulls on the basis of A2A2 status, this may not be true in many countries. It would be nice if breeders in these countries could easily determine the genotype of their bulls and start the process no of progeny testing primarily with A2A2 bulls.

      If you have time it might be useful to write up just how the semen business works and what a firm should do to protect itself if the market changes to demand primarily A2A2 semen. This could easily be sent to relevant firms (breeders and semen selling firms), or some might find it themselves on line.

      • Keith Woodford says:

        Edward
        Bulls are assessed based on 1) parentage, 2, DNA, 3) daughter proven.
        Daughter proven is generally regarded as the most accurate method but with semen first collected at about 12-15 months of age the bull will be four years old before the first ‘daughter proofs’ are available. DNA ‘proving’ based on many thousands of genes being evaluated is becoming more popular but this is still a developing science. Parentage is still used as the first criterion to select likely bulls for DNA testing and daughter proving. breeding worth is measured in dollar terms from an equation that includes about six key production factors.
        Once a bull has been identified as having a particularly high breeding value then by use of artificial insemination and appropriate semen dilution techniques it can be used to sire hundreds of thousands of cows. Here in NZ we use only about 30 bulls for about 4 million inseminations. Of course this creates a somewhat narrow genetic base which does lead to potential issues of inbreeding. This is part of the reason that here in NZ we also have a focus on cross breeding between the Holstein/Friesians and the Jerseys. Please note that I am telling you what we do rather than what we could or should do, which may or may not be another matter. In relation to the A2 issue, finding enough good bulls will not be a major major constraint here in NZ. We have already moved our national herd considerably towards A2 over the last 10 years but this is in part due to serendipity. In relation to the US, I cannot comment with confidence wihout having up to date reliable information as to the incidence of the A2 allele.
        KeithW

      • Edward Miller says:

        This relates to the kind comments provided by Woodford just below.

        Thanks for explaining more on the semen business. Rather than as I presumed the procedure being to select some candidate bulls, extract semen, and see how their daughters do, and then if the semen proves excellent move to large scale sales, the bulls are selected in other ways and then after about four years the data on their daughters becomes available and provides additional information. Even with this system, if you believe the bulls in highest demand will be A2A2, it appears you should make sure enough semen is sold earlier from promising A2A2 bulls that you will have enough daughter data to ensure your firm of A2A2 bulls whose progeny records makes them very good sellers.

        I had not realized cattle genetics had advanced to the point where direct DNA could be that useful a source of information, since the cow genome was only recently sequenced. What is the patent situation? Is every key piece of genetic information patented? Are there situations similar to that of A1/A2 beta casein where one set of researchers discovered a difference, and then another person found a use for knowledge of the difference, patented that use, and now want a royalty whenever semen is to be sold of the valuable variety. Does the typical NZ dairy farmer now need to retain not only a veterinarian and accountant, but a patent lawyer? (rhetorical question).

        The reason I ask is that it is relevant to the A2 Corp’s patents. I was somewhat shocked that patents had been obtained on the obvious ways of utilizing scientific discoveries regarding the health effects of different types of bovine beta casein, not on how to test for these varieties (with one exception where the test appear to be on looking for associated markers, not the one of interest), or on a new way of removing them from milk, (other than such obvious one of avoiding cows that produced the undesired type of milk). However, maybe such patenting has been done before and there are court cases that say this is allowed.

        Incidentally, one implication of the apparent use of DNA tests now for bull selection is that incremental costs of determining A1/A2 status, if done as part of a group of tests, are even lower than if a single purpose test being done. Obviously, there are expenses in receiving a sample, processing a payments, answering questions, extracting the DNA, and sending back the results. These expenses must be incurred any time cattle DNA is tested for any purpose. If DNA is to be extracted for some other reason, it is easy to test for A1/A2 beta casein status. I presume this is how LIC knows the A1A2 status of their bulls (Am I right?). Their US catalog mentions their use of DNA technology for selecting bulls, which implies they are routinely extracting DNA.

        I do not know how other semen providers sell their semen, but if DNA based selling is widespread they are already extracting DNA. Adding an A1/A2 status test would be relatively cheap. There would be the issue of the lab knowing how to determine A1/A2 status. If they do not know how (I suspect they do or could quickly find out), I believe the A2 US patent on a testing procedure reveals enough information to do so (where the DNA sequence is the needed information). It can be done without infringing the testing patent if they do it in what appears the cheapest way (checking the DNA directly to be see what it codes for). If most firms do know the A1/A2 status of their bulls, this may be how they found out. Do you know if my guess is right?

        While the most recently issued A2 Corp. patent (US Patent 7,863,002, McLachlan and Stuart inventors) gives them a very strong position since it covers the “invention” of using A2A2 status determined in any way to select animals, since I read it as not covering a semen seller (or other breeder) who merely tests his animals (without using the results for selection) to discover their A1A2 status and chooses to mention it in his catalog, as LIC does. As far as I can tell a semen seller does not infringe the patent if he claims milk from A2A2 cows brings a higher price in Australia, New Zealand, and the US. The LIC US catalog on p47,says:
        “Lic does not endorse any claims related to A2 milk. However, milk containing only the A2 protein is selling in usa, New Zealand and Australian markets at a premium over standard milk.”)

        One reason I would like to see semen sellers giving A1/A2 status is that it could lead farmers who are unaware of the issue asking why are you reporting the A1A2 status of your animals, and hopefully getting an informed
        answer, or maybe even discovering it in the sales literature. Even if semen sellers can provide the answer if asked, I do not think most US farmers know enough yet to ask. If litigation fears prevent semen sellers from giving this information, it may slow down the conversion to A2A2 herds, which may hurt anyone who may be later wish to buy A2 type milk (say a bottler who hope to introduce A2 branded milk).

        Since this patent appears not to cover the testing, but only the “selecting” I don’t think the semen seller has infringed this patent (there are others) if some semen buyers choose to purchase semen of the A2A2 type over that of another types, even if that results from reading what was in his catalog. (US patent 7,629,119 appears to cover only an indirect method rather than looking for sequences within the gene itself.)

        However, if a US farmer after reading the LIC catalog chooses to order semen from the bull Ares (which is A2A2) instead of from an A1A2 bull, he may have infringed the patent. However, if Ares has some other property that led the farmer order the semen, it would appear the patent has not been infringed.

        Incidentally, it may be obvious that A2 Cop. might have some problems in discovering infringement in this scenario, proving infringement has occurred, and finally in proving damages.

        For instance, if LIC pays royalties to A2 on all sales of semen from certain bulls but not others and the farmer’s infringement causes them to collect lower royalties, presumably the damages are calculable. If say the royalty was $1 per straw and the farmer order 10 straws, the damages could be S10. It should be clear that in litigation, the A2 Corp might win (or might not if it was shown their patent was invalid) and collect their $10 in damages, which would help a little in paying their lawyer’s fee.

        However, if LIC pays no royalties on any bulls to A2 Corp. (which I suspect is the case), it is not clear that that A2 has suffered damages in reduced income from a semen seller from an infringement. Do you know if LIC pays royalties to A2 on their bulls?

        However, the A2 Corp. might take the position that a reasonable royalty for the farmer should be calculated on some other basis, possibly what the farmer’s milk would bring if he used the A2 patents and then had A2 type milk to sell, and what it would be if he did not (and hence had only regular
        milk to sell). Such calculations might be based on the going price for A2 type milk versus the going price for ordinary milk. In spite of the statement in the LIC catalog, I believe there are no buyers in the US currently paying a premium for milk from A2A2 cows. It does not appear A2 Corp. would win large damages on this theory either.

        Thus, farmer’s may be fairly safe from owing large damages to A2 Corp. if they select semen using information in a catalog.

        I was surprised the Veterinary Lab at Davis charges as little as $25, especially if they are paying some fee to A2 corporation for the certification and possibly for use of their intellectual property, (if any).

        This is much less than I would have guessed, since human genetic tests seem always seem to run at least several hundred dollars, or often over a thousand. On reading Devil in the Milk I had presumed one reason for suggesting use of A2A2 semen, but not testing cows, was that the costs per test were high. High per tests cost could make it prohibitively expensive to test the cows just to prepare for a possible situation in which milk low in A1 beta casein would bring a premium, or other milk a discount.

        In future discussions, it may be useful to mention how cheap the testing is, even if not done as part of a panel of tests, since that makes it clear how low the total cost of protecting consumers is, and of farmers preparing for a change in the market.

        From the Davis web site even though a A2 certified test (whatever that means) is offered, I did not see a statement that the purchaser got a license from A2 to use the results. Thus, having a test there does not get the right to use the results for many obvious purposes.

        In particular, if the purchaser of the test learns his animal is A2A2, it could be argued that he does not have the right to use this information to select the animal for any purpose without infringing the A2 patent. However, I could also see an argument that A2 in offering this test, should have known what it would be used for and should have, or already has, incorporated compensation for this use into the royalty paid by the Davis lab.

  5. Edward Miller says:

    I may be wrong in the statement that A2 did not have a patent that would prevent use of most methods of testing. One patent’s claims proves to be broader.

    US Patent 7,863,002 (McLachlan and Stuart inventors) titling and abstract suggests merely a method for “A milk or other dairy product, capable of minimising the onset of disease such as coronary heart disease or enhancing the immune response”. The abstract is rather misleading since they make no claims regarding milk or milk products. They do not claim any rights to a genetic test, although they do describe a couple.

    However, they do claim patent rights on using the genetic tests to select A2A2 cows and bulls for any purpose (presumably including milk production).

    Their first claim is:

    ” 1. A method of testing and selecting for a bovine cow or bull having DNA encoding for the production of milk containing .beta.-casein A.sup.2, A.sup.3, B, C, D, or E but substantially free of .beta.-casein A.sup.1, comprising: testing DNA obtained from said bovine bull or cow for the presence or absence of DNA that encodes for the production of milk containing .beta.-casein A.sup.2, A.sup.3, B, C, D, or E but substantially free of .beta.-casein A.sup.1, and selecting said cow or bull having [B1] DNA encoding for the production of milk containing .beta.-casein A.sup.2, A.sup.3, B, C, D, or E but substantially free of .beta.-casein A.sup.1.

    I am as little surprised they got this patent, since the idea seems too obvious to be patentable. What the verbosity says amounts to is that if you want a cow whose genetics is such as to produce milk containing only A2 beta casein, you want a A2A2 cows. This is done by selecting a cow that whose testing reveals the presence of the A2 allele but lacks the A1 allele. If you luse this technique you have infringed their patent.

    For those unfamiliar with standard genetic testing, perhaps a little explanation would be useful here. In explaining basic genetics, we may explain there are two strands of DVA and each may have sequences that differ at particular points. For this application call them A1 and A2. Some suggest thinking of them as colored beads on a string. There is a vast literature which explains how these “beads” affect things.

    Someone reading such discussions may think we look at the two strands, and for each of them make a list of the “beads” by color, and then work from that. They may even imagine someone uses a microscope and looks for the different “colors”. I am not certain the technology has advanced so far as to easily sequence a strand, and it is not the standard testing procedure.

    However, there are technologies (now widely taught and used) for detecting a sequence in a sample of DNA. This is done by breading the DNA into small pieces, then using a polymerase chain reaction to reproduce repeatedly a certain sequence (if it is present). If the sequence was present at all in the original sample, it is now present in large quantities. It can now be detected.

    If it cannot be detected after its presence has been increased thousands of times, it is presumed to be absent. Thus, it is possible to discover in a DNA sample if the A2 allele is present. With this information alone we do not know whether the animal is A1/A2 or A2A2.

    However, it is also possible to do something similar ti see if the animal has another sequence, here A1. If the animal has A2, but no A1 (the patent refers to “substantially absent”), it can be deduced that the animal is A2A2. While not stated in the patent, if A1 and A2 are both detected, the animal is A1A2, and if only A1 is detected the animal is A1A1.

    The history seems to be that genetic tests were developed by locating alleles which might be called A1 and A2 (there are more actually). As far as I can tell the inventors (McLachlan and Stuart) did not claim to have invented any genetic test, or discovered the basic laws of Mendelian genetics, or invented the basic logic by which one tests for two sequences, and then deduces whether the animal might have two copies of the same sequence at a particular position.

    However, they do claim to have invented the process of selecting (notice what is the key step here) the animal if the tests show it to be A2A2. This is an economically important step since most non-scientific applications do involve selection. Since they do not claim the right to the tests themselves, any scientist remain free to discover an animal is A2A2 using genetic tests and to write papers that use this information. However, should he wish to use the test results to select the animal (say he wishes to take a picture or draw a blood sample) he would be infringing on this A2 patent.

    Thus, this is a very broad patent covering a wide range of uses of the tests for selecting A2A2 animals.

    Frankly, I would have thought the invention claimed was obvious if one knew basic genetics. This is an application of basic genetic theory to a particular gene and its allele.

    The next idea, which may be the original stroke of genius (satire intended) was to find an application for the above technology. Their application is to cow and bull selection. Having identified an animal that was A2A2, their idea is to select this animal if one wants an A2A2 animal. There is a lot of verbiage, but this is what Claim 1 amounts to, just expressed in a less obvious manner (probably to make it appear original and non-obvious).

    Claims 2, 3, 4, and 5 are just specializations of the above and subject to the same problems.

    For instance, their invention as described in claim 1 any bovine to see if their genetic sequences revealed them to be A2A2 and then to select them for some purpose (such as to study those that might carry the genetic material for making bovine beta casein of the A2 type, to select A2A2 cows for milk production). Later claims cover specialized applications such as to European cows (which is where the economic importance is), or to cows and bulls separately.

    It is surprising that they do not make a specialized claim to using the results of A2A2 testing to select cows for milking (the application one might expect). Devil in the Milk suggests that A2A2 cows might be selected and then milked to produce milk unlikely to produce BCM7. Since the Claim 1 appears to cover all acts of selecting cows for A2A2 status, they do seem to claim the right to exclude anyone from selecting A2A2 cows in order to produce milk unlikely to produce BCM7 in humans. They also claim the use of such selection for any other purpose, such as to produce meat, or to exhibit, or for scientific studies.

    The Cattle Breeding Claims

    However, claim 6 goes further. The idea is once the above method has been applied to select what I might call an A2A2 cow, this cow is then to be bred with a bull also A2A2. This makes the patent valuable to A2 Corporation since it does seem to prevent anyone else from mating these types of cows with these types of bulls using any tests for A2A2 status, regardless of the purpose.

    At first glance this appears to cover all mating of A2A2 bulls and A2A2 cows, something that must happen millions of time per year in the United States and even in Australia and New Zealand. However, the operative word is selection and then mating.

    However, even then this appears an obvious application. I understand that animal breeders have often selected cows on the basis of various tests, and then mated them with bulls selected on the basis of various tests. Using a genetic test is obvious, and is a technique probably known to others (prior art) before the inventors thought of it.

    .
    Proving Invalidity of this Patent

    Thus, it appears all of the claims in this patent are obvious and these should not have been allowed. It would probably be possible to convince a judge or jury of this, especially if evidence of prior art could be found in which someone had selected A2A2 cows or bulls for any purpose.

    There is a procedure in the US for paying a substantial fee and having a patent reexamined. I think if this was done, these claims could all be overturned.

    It does seem that the idea of selection using data, and even using genetic data, and even data on whether bovines are A2A2 has occurred to others.

    Devil in the Milk reports on a patent application by scientists at Fontera regarding autism. They seem to have independently come up with the idea of using data on the A1A2 status of cows for purposes of selection. Likewise those working on the causes of type 1 diabetes seem to have come up with the idea of using A2A2 status for cow selection (leading to an A2 Corp assigned patent). Possibly other scientists working independently also came up with the idea. This may suggest the technique would be obvious to one skilled in the relevant art (cattle breeding) or even to an ordinary citizen.

    It is possible that someone wishes to challenge this claim could find someone had selected bovines as A2A2 prior to McLachlan and Stuart. Since this claim is so broad, selection might have been for taking blood samples, showing the cow to someone, collecting further material for genetic studies, or for milking to see if the theory was really right that they would produce milk of the predicted beta-casein type. If such an early example of selection using a genetic test for A2A2 status could be found, it follows that McLachlan and Stuart were not the first to select on the basis of A2A2 status. In this case, they would not be the first to reduce to practice this invention, and hence Claim 1 would be invalid (as would all of the others).

    I know that the idea of testing for bad genes that are adverse and selecting (for any purpose, not just breeding) animals without these genes has been used before. If someone decides on the basis of scientific research by McLachlin and Stewart, that cows and bulls carrying the genes for A1 beta casein are not wanted, the idea of selecting animals that do not carry it as established by DNA testing appears to be an obvious extension of known techniques (prior art).

    Possibly, Woodford with his knowledge of the industry knows whether something similar may have been thought of by someone else, or even applied to cattle breeding. Has anyone earlier thought of using genetic data to select cows or bulls carrying certain alleles of genes? Possibly genetic data had been used to select animals that did not carry a certain allele. This would not quite be the same thing, but if they had, I would argue the step of extending the technique to A2A2 status was obvious. Notice this is not pure science where cow genetics are investigated, but involve the step of actually using the data for selection.

    Frankly to me the idea of using data on anything to select from multiple object is obvious and has been used before. If there are pairs of shoes and I know a test for discovering which shoes are black (call them A2 for convenience) and which are white (let us call these A1), and I wish to have a pair of shoes that contains a black shoe, but is substantially free of white shoes, I know how to use my test information.

    To provide an example of how I use the technology, I may be planning to go to a meeting and wish to select a pair of black shoes from the pairs of shoes in my closet . First I use my testing technology (looking to note the color) to determine which shoes are black (A2). When I find a pair of shoes both of which are black (A2A2), I then select that pair.

    Admittedly, in this example I used my scientific knowledge about the properties of pairs of shoes and some logic. I happen to know that pairs of shoes contain two shoes. From that I deduce that if I have one black shoe (A2) in the pair but that the pair is “substantially free” of white shoes (A1), that hence the pair must be black (A2A2). The above is science and logic, but there is technology involved also. I use a selection rule (the technology) to actually select that pair.

    The invention here is based on some genetic science which was not developed by the inventors named in this patent, namely that somatic nucleus’s DNA contains only two alleles of a particular gene, from whence they deduce if one know one of them and the other is “substantially absent,” it must be homozygous (to use the technical term) for the one that you have detected.

    It is interesting to inquire as to whether anyone else might have thought earlier of the idea of using genetic tests to identify A2A2 cows and A2A2 bulls and then selecting them and then breeding them, or had actually done so.

    This might have happened for scientific reasons. I could imagine (not knowing the history) that when it was found that some cows produced one type of beta casein, others a different type, and some both, the question arose of why. Was this due to a disease, differences in feed, or was there a genetic difference? If there were two alleles that were co-dominant this could result. The genetic theory could be tested, since it predicted that a A2A2 cow mated to a A2A2B bull would produce cows whose milk would have only A2 beta casein. Possibly someone actually did this experiment, or thought of it. If we could just find evidence of this having been done it would destroy this patent.

    The idea of mating A2A2 bulls and cows does seem to be implicit in several other inventions people have claimed such as to prevent autism, suggesting it occurs to someone familiar with cow genetics and breeding whenever there is a new scientific discovery regarding milk.

    Surprisingly, although this patent is full of a discussion of heart disease and related topics, the claims themselves are not so limited. Possibly the examiner was so distracted by the discussion of heart disease etc. and/or admiration for the scientific discovery of the inventors that he did not notice that what was actually being claimed was obvious, and probably not patentable.

    However, I understand new claims for an invention can be introduced at any time. If the claims in this patent were removed, I would expect A2 Corp. to retreat to the sort of claims that are implied the abstract namely, “A milk or other dairy product, capable of minimizing the onset of disease such as coronary heart disease or enhancing the immune response”. These are what one reading only the patent abstract probably presumed the patent involved.

    The Patentability of a Scientific Discovery

    I think they could probably get such more restricted claims approved, subject to one big issue, (patenting a scientific discovery or idea). US law (as I understand it) is that scientific discoveries cannot be patented, although the use of them to produce a new machine or “composition of matter” can be, but only if the applications are sufficiently non-obvious.

    McLachlan and Stuart deserve much credit for a scientific discovery, but it appears to me that is all they did. Once this discovery (which is really just a strong probability since experiments have not been done on humans), the rest is obvious. If you believe there is something in a food that is bad for health, you realize that removing that matter would be good for health. If certain types of cows do not produce the problematic substance you avoid consuming their milk, or milk products containing that substance, or do not let the problematic substance get into the milk consumed by humans. It is rather obvious how to do this.

    Once piece of evidence is that McLachlan and Stuart, who apparently were not dairy scientists, immediately saw what would have to be done. One “skilled in the art” of making dairy products, or mixing milk, would have found this even more obvious.

    US law does make “a new composition of matter” patentable. A scientific discovery that pointed to a useful new composition of matter could lead to a valid patent. Presumably the discovery of a non-obvious way of converting beta casein of one type to another non-harmful type in milk could be patentable, since such milk might be a new composition of matter.

    However, A2A2 milk has a long history of being produced in the US and it is not a new “composition of matter”. Historically millions of Americans had a family cow that provided them with milk. Probably several million of these were A2A2. Each of these families was a producer of A2A2 milk. Many of them sold their milk. Thus milk we might call A2 is a product that was once sold in the United States, although not branded with the A2 brand. Alas, A2A2 milk is not “a new composition of matter.”

    A similar comment could be made about breeding cattle to produce offspring that would produce A2A2 milk. It appears obvious how to do this given basic genetics and what is known about different cows producing different types of milk. That this may be obvious is that McLachlan and Stuart, who are not cattle breeders thought of it, as would any reader of their papers. I should be even more obvious to anyone in the business of cattle breeding, or selling semen.

    While I find these argument persuasive, they probably occurred to the patent examiner. There may be a history of court cases dealing with such arguments that I am not aware of.

    This issue does seem to arise for the whole of the A2 patent position. Important scientific discoveries or hypothesizes were developed by scientists who deserve credit for these. The logical implications of these include that most humans should probably avoid cow milk now on the market, replacing it with goat milk, human milk and other foods. A rather obvious implication for milk mixing arises from the knowledge that only milk from some cows raises the risk of creating BCM7 in the process of digestion. A very obvious implication from well facts that were not discovered by A2 Corporation or the inventors of their various patents, is to select cows as a source of milk that will produce the healthier milk.

    Since such cows appear to produce healthier milk, cows should be bred so they are more likely to produce this type of milk, using well known and obvious techniques. Unfortunately, what is original among the inventors are non-patentable scientific discoveries. The details of going from these discoveries to a milk (and milk products) unlikely to produce BCM7 in humans are obvious, and it appears should not have been the basis for patents.

    Once can certainly imagine many cases where a scientific discovery leads to patentable inventions and this could have happened here, but appears not to have. If A2 had launched a research program on testing to discover new and improved test for A1/A2 status of cows and bulls, these tests could have been sufficiently original to be patentable.

    If the prevention of BCM7 from being produced in the human gut required a special type of milk that A2 launched a research program to discover, and did discover, such an invention might be deserving of a patent. However, the steps to producing milk unlikely to produce BCM7 in humans were obvious. The idea of producing that milk from A2A2 cows is obvious, as is the idea that once produced that milk should not be mixed with A1 type milk. If more A2A2 type cows are desired, the breeding technology is obvious and was not invented by the inventors listed on A2A2 patents. If milk products less likely to produce BCM7 in the human gut are desired, the obvious solution is to produce these products from milk that is low in A1 beta casein.

    Unfortunately, such patents were approved and that raises issues for those wishing to provide A2 milk and for those who wish to promote human health through replacing A1 type milk with A2 type milk. We can try to promote A2 Brand milk and encourage local firms to acquire licenses and provide it. We can try to find local firms that will fight to overturn the patents. We can try for legislation that will make the healthy products available or remove obstacles to them being available. We can look for ways to get healthy milk and milk products through importing from other countries where they are available, or can be made available. We can try to inform the public of the dangers of milk as currently sold and encourage them to try goats milk or other alternatives.

    Claims that Might be Approved

    Lets consider how valuable disease prevention claims might be if approved since A2 corp. might seek to add such claims to this patent if they lost on the existing claims. How valuable the patent was might depend on how such claims were worded.

    I presume they could be forced to claim only selection of cows for the production of milk and of bulls and cows for breeding. These appear the economically important uses of selection for A2A2 status.

    They might try for wording that covered all selection for health or disease prevention. I think they could be forced to retreat to selection for vascular health, or heart diseases. Another patent of theirs deals with diabetes prevention. It would be hard to add that claim here since they have already disclosed that idea.

    The exact wording could be important. If selection was claimed was “only” for heart disease, one who was selecting for other purposes would be home free.

    They would probably press for wording (as in the abstract) for selection of animals, to produce “A milk or other dairy product, capable of minimising the onset of disease such as coronary heart disease or enhancing the immune response.” In this case those selecting for other purposes would be in a better position, especially if their advertising etc. did not mention coronary heart disease or things within the scope of the patent.

    Personally, I do not like the idea of patents where whether or not they are infringed depends on looking inside someone’s mind to know what his intentions were. Such patents encourage lying.

    One looking ahead to litigation would want to be sure their language did not suggest that any selection was done for the purpose of minimizing the onset of coronary heart disease or whatever was covered in a revised patent. This would imply avoiding advertising that the product lowered the risk of heart disease.

    Given that the obstacles to making health claims in advertising, having such a restriction would not be fatal. I personally believe there is evidence enough to support a health claim. If the A2 brand could make such a claim regarding heart disease, but others could only claim benefits related to autism or another disease, A2 could have a market advantage. In the environment where health claims were being made, smart consumers would soon realize that milk that might reduce the risk of autism was milk unlikely to produce BCM7 in the stomach. They could deduce the milk that lowered the risk of autism was the same milk as might protect against heart disease.

    If wide spread public concern arose about milk capable of producing BCM7 in the digestive system, legislation might be passed requiring either that only A2A2 milk be sold (or used in schools) or that the A1 beta casein level be on the carton. Milk producers selecting cows to produce such milk because they wanted to meet a regulatory requirement or because the milk buyers wanted such milk would be in a strong position. The same would be for milk bottlers or milk product producers trying to meet such regulations, or produce low beta casein A1 milk to meet a market demand (not because of an altruistic desire to reduce the risk of heart disease). I could even imagine laws and regulations being passed just to provide legal cover for milk producers, bottlers, and milk product producers.

    A major legal issue is the extent to which intention might be deduced from actions. A2 lawyers would love to argue that the very fact that selection was for milk from A2A2 cows was evidence of intention, otherwise why was the expense of selection undertaken followed by separate handling of the milk. They would have a strong case if there was no other reason for such selection, and the selection was very expensive. However, there are many reasons a bottler might try to obtain milk from A2A2 cows besides its effect on heart disease, including its effect of mental condition, better digestion, etc.

    Those considering producing a milk without infringing this and having to worry about lying do need to examine their motives. Let us look at the two extremes.

    There may be a charitable foundation dedicated to reducing the risk of heart disease. They, in the absence of this patent, might wish to arrange with farmers for a supply of A2A2 milk which they would bottle and distribute to individuals at a high risk of heart attacks. They may wish to do this either as a research project, or as a service to individuals at high risk of heart attacks. They should not do this because they could infringe the A2 Corp. patent.

    There may also be a foundation working with ulcer patients whose ulcers had not responded to the usual treatments. They might know that milk appeared to reduce the discomfort of ulcers and be aware that once a dairy diet was used for ulcer patients. However, they might also be aware that this diet appeared to damage the heart as disclosed on autopsy. This might lead them to wish to research the idea of bring back a version of the Sippy diet, but with milk from A2A2 cows. Admittedly, if for research they might be able to get a license from A2 cooperation, but if not they should be aware they were at risk of infringing this patent.

    At the other extreme consider “Mike, the Mad Milk Man Mutilator.” His public resume states “I dropped out of school at 15 since I had never been able to pass third grade science, and know nothing of biochemistry or medicine or what cause heart attacks. I care only for myself and my money. I have no desire to reduce the nation’s heat attack rate. I got my start in business importing illegal drugs from Mexico and being usually ruthless in snuffing out competition. I moved into the milk trade when I discovered there were big profits from adding melamine to Chinese milk. I cared no more about the number of babies killed than I do about giving heart attack to other Americans. I was told that if I put ‘from A2A2 cows’ on my milk it would sell better. My lawyers, the same ones that got me off from several torture and murder charges, told me it would be best if my milk was actually low in beta casein A1, whatever that is. Hence I told my Goons to tell the farmers they better select their cows to be A2A2, whatever that means, or else their children would be killed after I raped their wife in front of them and before I tortured them to death.”

    While possibly not the best PR position, his conscience could be free of concern he had infringed the A2 Corp. patent concerned with milk that protects against heart attacks.

    While milk bottlers might not have to be as extreme in their public positions as “Mean Mike, the Mad Milk Man Mutilator,” patent concerns could limit what they said, and give A2 Corp. an advantage.

    Likewise, his farmers would be free of concern if the only reason they selected their cows to be A2A2 were the right right ones They would be safe if they were not concerned about the nation’s heart attack risk, but only trying to protect their own hearts from the heart break that would result if threats of the form “their children would be killed after I raped their wife and before I tortured them to death.” were actually carried out.

    In the absence of such threats, farmer’s would not be selecting for A2A2 cows to minimize the risk of heart disease if they merely observed that such milk could be sold for a high premium and chose to provide it.

    As can be seen, the existence of such patents discourages altruism and concern for public health in the food industry. Such patents certainly go against the thrust of public policy, and pointing this out could be an asset in litigation.

    The above is somewhat satirical (but apparently accurate) and might be used in persuading a community to pass laws requiring conversion of herds to A2A2, or putting limits on the amount of A1 beta casein in milk. Such laws would provide an incentive for selection for A2A2 status, and hence leave their farmers free to select cows for A2A2 status and their milk processors free to buy such milk at premium price. Such laws would have many health benefits at low cost.

    Cattle breeders (including semen sellers) might be in a strong position if they were merely breeding for what the semen or animal buyers were asking for (A2A2 status) and saying nothing about heart attack benefits.

    They might be in an even stronger position if they listed A1/A2 status in their catalogs and merely filled orders as they came in. If, for some reason straws of semen from A2A2 bulls was ordered more often than from other bulls, they should not be thought to have infringed the patent. Even if they eventually sold their A1A1 bulls to a meat packer because his semen was not selling, they would not be infringing the patent as long as preventing heart attacks was not their motive.

    A Health Claim Patent may Complicate Certain Marketing Techniques

    Such patents also block or make more difficult a marketing technique that is used in the US to get around restrictions on making health claims. The US has a constitution guaranteeing a free press, and it is very hard to restrict them in reporting the news and expressing opinions, including ones about health and the health effects of various foods. However, the courts have held that this freedom does not extend to commercial speech (advertising) and FDA does restrict health claims in food advertising and supplement advertising.

    One way around the advertising restrictions is to have an allied magazine, web site, or book publisher make the health claims. A leading user of this technique is the Life Extension Foundation, which publishes a glossy magazine with good articles about health, but with most articles dealing with vitamins and supplements, always in a favorable way (there are lots of scientific papers cited and apparently correctly, but the papers with negative results are often not mentioned). Most of the advertising is for supplements (most of which are produced and sold by organizations affiliated with the Life Extension Foundation, and which can be ordered on the internet or over the phone). This advertising appears to stay within FDA guidelines. However, it is easy to imagine someone who has read how something can be used to treat or prevent a disease, placing an order after reading an article describing the health benefits of the item.

    This firm, or one using this technique might run articles on why milk containing A1 beta casein should be avoided (I have suggested such an article, and one reviewing Devil in the Milk to them). They might also run advertising for products they might stock such as A2 branded milk products, other milk products low in A1 beta casein, and goat milk. If they talked about the health benefits in preventing heart disease, it might be harder (but not impossible) in an infringement case to argue their goal was not to prevent heart disease. I believe the magazine and the distributors of products are different legal entities, but clearly affiliated.

    I have read of stores carrying products and placing them next to racks of books praising them (where those waiting might browse them). I have seen supplement stores also carry cheap paperbacks on certain supplements, or even sending them out with orders. Having to worry about a patent that using something to reduce a disease risk makes these techniques harder.

    A worrisome area is the attempt of A2 Corp to extend a patent to cover a series of firms, each of which carries out a step in the process. If A2 Corp. did have a valid patent on producing A2 type milk for preventing heart disease (or any other purpose) and a firm did the whole process, claiming to reduce the risk of heart disease in their advertising, selected cows by DNA testing and then bottled the milk, they would have violated the patent. However, the milk industry has had few such vertically integrated firms. Instead the typical pattern is for there to be one group of firms that sell straws of semen, a larger number of farmers that produce milk, and processors that bottle the milk, along with other processors that make products such as ice cream or cheese.

    However, I do not believe a farmer who chooses his cows by what price their milk will bring and selected A2A2 cows (or even breeds them) to produce milk that will bring a high price would have violated such a health based patent, even if he used DNA testing (and the patent does not cover other forms of testing). It would seem he clearly would not if he did not know why a firm offered more for a certain type of milk. I would argue he did not even if he knew the buyer was offering more because some consumers thought such milk would provide protection against heart disease. The farmer did not violate the patent by using genetic testing as an aid to producing such milk.

    I would argue also he did not violate this patent if he merely bought semen labeled A2A2 or bought cows that were that way. A2’s recourse would be to the breeders or cattle suppliers, not to the farmers, and even less to the buyers of their milk.

    Unfortunately, even with health claims, the issues are just enough subject to dispute so lawsuits could be brought. Fear of these could still deter people in various industries from dealing with the problem of A1 beta casein in milk.

    If A2 is actually selling A2 branded milk (or a franchisee is) it would look bad if they were also litigating to block actions to lower the amount of BCM7 produced by consumers of other milk, or to make difficult for other firms to provide a safe healthy supply. If farmers running mixed herds were trying to reduce the number of cows carrying the A1 gene, it would look bad for A2 Corp. to try and stop them with lawsuits.

    Of course, a A2 license bottler would find it easier to recruit farmers to sell them milk if such farmers had a ready source of semen and embryos, and if such farmers already had herds that were mainly A2A2. If A2 Corp’s business plan is to license the A2 brand, or to exploit any patents that give such licensees an advantage in marketing their milk, it may not be in their interest to enforce health related patents against farmers and breeders. Notice this patent as now written does not deal with A2A2 milk, but just with selecting bovine animals.

    • Keith Woodford says:

      Edward,
      I agree that there seems to be nothing novel in the idea of using a genetic test to select cows. I would assume that the notion of testing and selecting was in the public arena prior to the A1/A2 issue coming along, but I would need to do research to find that and I don’t have the time at the moment. Presumably one would find this in the animal science and animal genetics literature. Also, I would need to know how far back lies the priority for the A2 claims, i.e. when were they first made, to know how far back I would need to go.
      How much would it cost a competitor to A2 Corp to get this claim re-examined? And is Trust law relevant? And if someone has actually paid for a test(such as the Davis test which is licensed by A2 Corp) what transfer of rights is implied by that payment?
      KeithW

      • Edward Miller says:

        As to the priority dates, the key ones I believe are Apr 11, 1994 [NZ] for the Elliot related claimed inventions and May 16, 1995 [NZ] for the McLachlan and Stuart ones related to heart disease. The recently issued (2011) one related to selection using a genetic tests appears to date back to this date. The Lee; Michael Ah (Dunedin, NZ), Tate; Michael Lewis testing method (which appears to amount to using a haplotype) dates to May 24, 2002 [NZ].

        US law is based on the date of the invention, but obviously the invention date will be earlier than the first filed application.

        For an invention to be patentable it must not have been published or revealed to the public more than a year before the first patent application (otherwise it is presumed that the inventor meant to give the public rights). It is at least possible that this requirement was not met if some of the obvious implications were mentioned in articles or public lectures, or to friends, or used in some way (such as selecting milk or animals). However, such evidence could not be presented in reexamination, but only in litigation.

        As to what it costs a firm who wishes to enter the market to request a reexamination, a Widipedia article on reexamination states it is available on the following terms:

        “Ex parte reexaminations are initiated by members of the public, but once said members submit their request, they no longer actively participate in the proceedings. The correspondence is strictly between the examiner and the patent owner. The fee for filing a request for an ex parte reexamination is $2520. [3]

        Inter partes reexaminations are initiated by member of the public, but said members of the public continue to participate in the proceedings. The fee for filing a request for an inter partes reexamination is $8800.”

        The only new information that can be considered is evidence of prior art in the form of written material or another patent. Strictly speaking it would seem issues of originality or obviousness could not be raised, but prior art may indirectly raise them since there is often a question of whether or not prior art was so close to the claimed “invention” that it was essentially the same thing as the invention.

        These appear affordable if you are planning to launch a new brand of milk. Notice however that since A2 has several patents you could run afoul of, Costs might be occurred for each one that you thought you had found prior art for.

        However, costs seems high enough to prevent individual farmers or consumers from doing it. It might even be affordable for a public spirited citizen or organization who thought there were problems, especially if they could get some nice publicity out of it (or which might promote their cause such as encouraging the conversion of herds, reducing milk drinking, or promoting animal rights).

        There is provision for buying copies of records related to a patent, and doing so may reveal whether issues had been considered. Seeing for instance what claims had been rejected might show what prior art had been considered, and give an idea of whether if a claim is rejected on reexamination, the applicant might request a narrower claim that still covered your business plan.

        There is provision for the Director of the Patent Office to order a reexamination, but I doubt a member of the public could easily lobby for this (although it might work to go through your Congressman, especially if you were acting just as a public spirited citizen and not as a potential competitor).

        However, if public controversy should emerge and it appears that patents had been issued for obvious ideas that had clearly been in use previously (not drinking disease causing milk, using genetic tests to select animals, testing milk and then not mixing the less healthy milk with the more healthy, giving exclusive rights for a type of milk that cow owners had been selling for hundreds of years, using test results for breeding, etc.) I could imagine the Director fearing damage to the reputation of the agency, requesting a reexamination. This would seem especially likely for a small foreign firm with no US employees that appeared to have been sitting on patents that could be of great public benefit if used.

        US antitrust law is certainly relevant.

        However, it is complex, and has changed over time. In general, the law frowns on tying purchase of one product to purchase of another. In patents this would cover trying to extend your monopoly beyond the expiration date of your legal monopoly in some way.

        This might apply in the breeding area if the goal of A2 is to make it hard for other firms to find easy to convert herds in the future, even after their patents affecting the sale of milk have expired. The goal for doing this might be to leave their A2 brand in a stronger position if there were few farmers who could economically convert. Possibly their franchisor had signed up the farmers in the area with suitable herds, and these farmers had bought up most of the A2A2 cows and heifers, including those who were pregnant and likely to be carrying A2A2 calves.

        Most of the antitrust cases I have heard of were ones where a firm had a monopoly in one area (due to patents) and were trying to use this to restrict competition in another industry. Of course, A2 is nowhere near a monopoly in any US industry, and appears not even to have any operations or sales in any part of the industry (with the possible exception of the testing at Davis, which may not involve a patent, but merely the provision of a “certification”.)

        What rights one gets from having Davis test a sample is unclear.

        A general rule is that if you buy a patented product you get the right to use it (I think this rule emerged to prevent people from being charged twice, once to buy the product and then to use it, and being caught by surprise).

        I believe if Davis owned the patent, this would apply at least with regard to the test. However, their claim is also to various uses of the test.

        However, since A2 claims some intellectual property rights and there is a notice on the Davis site the situation is unclear, but users are probably still exposed. The warning on the site puts them on notice that they may not be able to use the results for all purposes. Given this notice, customers cannot use the argument they were defrauded by paying for a test, and then being hit by a second charge to actually do much with the test. As I have pointed out the notice does not actually claim an A2 patent is used for the test (I suspect it is not for reasons I have given).

        I personally think A2 would be better served by arranging to have a small fee included in the charge for the test (say $5.00), and then explicitly giving a license to use the test results for animal selection and other purposes. It appears they are getting no revenue from the US now, and this could provide revenue at a very low administrative and collection cost. I will either send or post a note to explain why I think A2 is hurting themselves by the current situation.

  6. Keith Woodford says:

    Thanks Edward
    This has increased my understanding of US patent law and also trust law
    KeithW

  7. Edward Miller says:

    I , like you believe the current testing situation is very bad for the public. However, it appears very bad for A2 Corporation also, and it would be in their interests to change policy. I will post my analysis here. Perhaps you know how pass these suggestions on, or to whom I should write.

    It is not clear to me that it is in the interest of A2 Corporation to try to hinder the conversion of herds to A2 status, such as by trying to vigorously enforce their patent rights. They seem to be getting no revenue from either the US or Europe (or any other countries other than New Zealand and Australia) in spite of their patents. Surely they could do better and receive at least a little revenue by another strategy.

    A2 claims to be shifting from being an Intellectual Property Company to being a Fast Moving Consumer Product Company. The optimal policy for these two types of companies differ.

    An intellectual property company should try to maximize its return from its patents by aggressively threatening legal action, licensing at the highest practical fees, and often using the threat of legal action to extract (“extort”) money. If profit maximizing, they might do this even if the result is to hurt the public health by preventing very low cost measures that might benefit it, such as by decreasing the percentage of cows that are of the A1 type.

    However, as a firm that want to market A2 milk (or license their brand name) their interests are different.

    The first problem in being able to sell A2 brand milk is to obtain farmer’s who can supply A2 type raw milk. The chief problem for farmers is the cost of converting their herds. Conversion will often mean selling cows which are not A2A2 and replacing them with A2A2 ones. One immediate problem will be knowing the status of your own animals and that of cows you might purchase. It possibly cannot be done without infringing A2 patents.

    I presume that any franchise holder has the power to grant its own suppliers A2 licenses so they can produce milk and convert their herds. Of course, to even discuss converting you need to know the current status of your herd. Let’s presume A2 lets its franchise holders grant whatever license is needed. Then potential supplying herds can be tested in order to permit intelligent negotiations.

    A harder problem is finding A2A2 animals to buy to replace those that do not qualify. Currently potential sellers will not have the required information and A2 may not wish to grant large scale licenses to those who may merely sell their cows to herds producing for A2. They may have some procedure that involves getting a hair sample from a possible cow and testing it before purchase, while there is an option to buy. This process could take a while, and possibly even delay farmers from contracting with A2 while they tried to determine if they could get suitable A2A2 cows at a feasible price.

    It would be a lot simpler and cheaper if the status of many cows were known to the farmers before A2 even tried to established a franchised processing operation.

    Now let’s look at the problem of actually selling the non-A2A2 cows. While it might seem they could sell the cows they do want at market, and buy A2A2 at market, this is unlikely. The problem is that other farmer’s will presume that there is a problem with any cows offered for sale. There is only a small market in cows.
    Farmer’s normally obtain their own cows by raising calves born to them and inseminating them when old enough. Since there are more than enough heifers being produced on a typical farm for replacement purposes, the market for dairy cows is small.

    If another farmer sees an apparently healthy lactating cow offered for sale, he will ask what is wrong with it, what is its hidden defect. He will know that normally lactating cows or even cows that appear to have more productive lactations ahead of them are not normally sold unless the cows has a problem. Thus, the price received for the the non-A2A2 cows being sold will be relatively low.

    This problem would occur even if only one farmer was trying to convert his herd. However, when an A2 franchisee enters a market it will need to persuade many farmers to convert their herds. Farmers will know that not only will they need to sell cows that are already producing, but that they will not be able to add to their producing herd animals that they have already inseminated, or heifers that are of the wrong genetic type, or calves that have already been conceived, but not yet born, if any of these are of the wrong genotype (as most will be).

    Since milk is expensive to transport, the milk supply will come from a limited area around the processing plant. This will normally require persuading a reasonable fraction of the farmers in the area to commit to supplying milk of the right type. Even if the A2 franchisee could draw on a larger area, he would save in transport costs if the source of his milk was nearby and enough farmer’s were willing to commit so that his trucks could be routed efficiently. When all of these newly converting farmers are trying to sell producing cows (and possibly heifers of the wrong type also), there will be an oversupply that will depress cow and heifer prices. The larger this potential oversupply, the harder it will be to recruit farmers, and the higher the price premium they will have to offer.

    Thus, it would seem that if A2 Corp is likely to enter a market, they would desire to have as large a percentage of the cows in that area of the A2A2 type as possible. This calls for encouraging farmers to have their animals tested now and to start conversions. It would be in their interests for catalogs of semen to give the A1/A2 status of the bulls, and for most semen offered to be A2A2.

    Farmer’s will know that after they have contracted to supply A2 franchisee with milk, that they will be buying A2A2 semen exclusively. Currently a farmer contracting with A2 franchisee looking at semen catalogs could conclude tested semen was almost unavailable.

    He really would not wish to plan on using random semen and each year having to sell some of the calves because they were other than A2A2, and genetically unsuited for the herd. I presume A2 will make some arrangement for the farmers who will supply their franchise holders with milk, This would presumably let potential semen sellers have their animals tested so that they can supply semen to their contracted farmers. If they are going to eventually do this, perhaps they should start now.

    Possibly when A2 developed their original business plan they thought they would sign up enough semen suppliers to pay royalty fees so that semen availability would not be an issue. This apparently has not happened, however.

    If such semen seems unavailable or available from only a few bulls, farmers will feel that this restriction on bull choice is an additional cost of contracting with A2 Corp. Thus, it is in the interest of A2 to try to insure there is a good supply of A2A2 semen available with adequate genetic diversity. If semen suppliers can easily get genetic tests (without demands for royalties) they are more likely to start progeny testing of A2A2 bulls now. Thus, when a farmer is considering contracting with an A2 franchise holder he will find he is unlikely to suffer appreciably from the restriction of his sources of semen.

    If A2A2 semen was not be available earlier, those signing up with A2 will have many heifers impregnated with non-A2A2 bulls. These animals will be expected to give birth to many A1 containing calves that will have to sold, probably at a low price, to meat packers or to other farmers. These farmers are likely to contemplating (or hoping) to sell milk at a premium to the A2 buyer, and will not offer high prices for such A1 type animals that will create a problem for them later on. If A2A2 semen was readily available now, many of the animals would have been impregnated with A2A2 semen, and less of the offspring would have to sold at a loss. This would make it easier to recruit farmer’s for A2.

    Also, after an A2 franchisee has entered a market it will hope to expand sales. Doing so is likely to call for recruiting more farmers. This may be made harder by earlier recruitments. Many of these potential suppliers will have sold their A2A2 cows and heifers to the first group of farmers recruited by A2 Corp. and bought A1A2 or A1A1 cows and heifers from the farmers who did sign up with A2.

    Some of the deals may have been done as trades. After the trades, the remaining herds in the region will actually have more A1 containing animals than before. Their costs of conversion will be even higher, since there may be no one left nearby to buy their excess A1 animals. This will make the problem of signing up new milk suppliers for the franchise holder in a second recruitment round even harder than his in his first round. This obstacle to expansion would be reduced if these farmers could easily buy A2 semen and use it, and selection of cows was on the basis of tests so these potential milk suppliers could begin to add A2A2 animals to their herds.

    The suppliers of milk for A2 Corp are more likely to come from breeds that are low in the A1 allele such as the Guernsey, Jersey, Icelandic, Australian Milking Zebu, etc. These breeds are the ones where there are fewer high quality progeny tested bulls, and this concern is likely to be greatest. Thus, A2 Corp should be especially anxious to be sure an adequate supply of quality A2A2 semen from such breeds is available and their A2A2 bulls are building a progeny record.

    A2 brand milk is likely to be priced to be a premium milk. Since several of the smaller breeds, notably the Guernsey already have an image of quality, building on this may be a good strategy. “Golden Guernsey” is a brand name that starts with a good reputation, for instance. They should be especially anxious to make sure breeders of such breeds have no obstacles to offering A2A2 semen and embryos.

    The Davis testing lab is “A2 certified.” It appears A2 is in the laboratory certification business (one that could survive the expiration of their patents). Concerns about possible litigation with A2 Corp arising from using a A2 Certified Lab can (and apparently has) led to either animals not being tested at all, to other labs getting the business. Their current policies seem to be hurting them in their laboratory certification business also (admittedly a small business).

    Public Relations

    There also is a public relations angle. There also is a major public relations issue. The name of the owner of the A2 Brand is the A2 Corporation. They look very bad if they have made it hard for Americans to have healthy milk, by denying access to the needed technology to farmers who for any reason wanted to offer healthier milk, or to breeders who wished to offer animals that would provide healthier milk. When an A2 franchisee approaches a farmer about being a milk supplier he does not want the farmer to have a bad image of A2, one that perhaps arose from difficulties he had in getting animals tested, or from complaints he has heard from others.

    More importantly, when a milk purchasers looks at a cooler and sees the A2 brand, she should have good feelings. If the firm has suffered from bad publicity she is less likely to buy. This may not be a serious a problem at first, when the A2 brand may have a monopoly in that market. However, the time will come when there are other brands that advertise low in A1 beta casein, or even free of it. Then, A1 will want to have a good image and to be perceived as concerned about its customers health (even if not their pocketbooks).

    If there are problems in advertising health benefits, as there may be, an A2 franchisee will try to get the message across though public relations means. There will probably be interviews of the local managers and franchisee owners. They should when asked “Why did you enter this business?” try to work in a health message, something like, “I was attracted by the opportunity to offer a product that made a real difference, one that protected our children against illness. I was excited when I talked to A2 Corp They were my type of people, ones who were concerned about our children.” This will not sound right when A2 is known to have taken actions that did not seem to be in the children’s interest.

    Also, it is likely that there will be stories in the press about the benefits of milk with low levels of A1 beta casein, or the dangers of other milks. If writers have a good impression of A2 Corp they are more l likely to say something like, “At this time, the only milk that is essentially free of the bad A1 beta casein is the A2 Brand milk.” Such mentions could be very valuable, since that may be the only way consumers will know that A2 Brand milk is worth its premium price.

    Writer’s often like drama in their stories. If they choose to focus on problems people had in getting cows tested, or threats of litigation against small farmers, A2 would look bad. That would hurt them with their customers.

    There will be confused customers who no longer recall whether A2 beta casein was good or bad. They may merely recall that it was mentioned in an article whose villain seemed to be A2 Corp. Then they are likely to remember the story as warning against something called beta casein, and have the impression that the story was about problems with A2 Brand milk. Sad, but that is the way human memory works, and trying to have the sort of reputation so that any errors made do not hurt your brand is wise.

    At first low A1 beta casein milk may be in the odd position of being promoted by volunteers, such as myself (I have suggested to several that they consider getting a license from A2 Corp, or offering its non-fluid products in the US when they become available), who are free to talk about its health benefits. If people are to devote significant effort s to promoting the product of a profit making company, that corporation needs to have a good reputation.

    There can be political considerations. Once ordinary milk is considered to have a problem and someone realizes there is only one alternative, A2 Branded milk, there will be calls for action. It will be noticed that A2 brand milk is premium priced, and there will be complaints about profiteering. Should a foreign owned firm be allowed to get rich off of the health of American children? The obvious solution is price controls. Possibly the key patents should be licensed to good American people.

    Milk is an extremely regulated product in the US. Such regulations can be manipulated to hurt unpopular firms and favor those whose owners are local, or at least US citizens. Surely the high prices charged for A2 milk should either be reduced, or some of the benefits should be passed on to farmers (especially any farmers hurt by A2 Corps failure to license earlier). Milk pricing orders have all sorts of complexity. They have traditionally been used to spread revenue from milk sales among all farmers. If this is done to A2 company, they could find themselves not only with unhappy suppliers but possibly with a requirement to make unprofitable sales to those that “need” healthy milk, possibly at a great distance (guess who pays trucking).

    It is traditional in the US that milk powders are priced lower than liquid milk. It can easily be argued that the greatest need for A2A2 milk is as the milk powder used to make baby formula. Possibly A2 Corp could be forced to meet this urgent public need, naturally receiving the usual low prices for milk used for manufacturing.

    If the low A1 beta casein industry has been retarded in the US, it could happen that there is A2 type brand milk available from adjacent countries, notably Canada and Mexico. There will be pressure to let such milk in. It is possible that 2A2 powdered milk and various dry products will be available from various foreign countries at prices much lower than the limited supply of such milk A2 can supply from its US franchisees (who will probably at best be directing only seasonal surpluses of milk to the powdered market).

    However, there is another alternative. While A2 Corp does not now make dried milk powders, it soon may be. This may be just to dispose of seasonal surpluses in Australia and New Zealand. They may look for ways to export to the US and get around traditional quotas (which it may not have). In persuading the US to be nice to it, it sure would be nice if they had a reputation for being nice.

    A strong case can be made for using A2 type milk in baby formulas. At this time, A2 Corp seems to be the only possible source. I think the there are problems with getting such dried milk into the US now (rules designed to protect US milk producers). I would hate for US babies to be deprived of an essential ingredient for a healthy baby formula just because the only supplier had a bad reputation.

    What should A2 do?

    The most obvious thing is to incorporate a small license fee in the Davis tests such that the test purchaser get a license to use the test results and A2 gets at least a little revenue (which is more than they are getting now).

    When and if A2 finds one or more processors to make milk bearing their brand name, these processor will find it easier to arrange for supplies of milk, and as the sales of the A2 branded milk and milk products grow, there will be suppliers of A2A2 milk available to them.

    The looming public relations disaster of being perceived as blocking safe milk would be headed off.

    Semen sellers and breed associations might mention A1A2 status. As farmer’s ask questions they would learn of the issue. The various owners of family cows would be able to obtain A2A2 cows easily, and they might talk up the advantage of low A1 beta casein milk. While some of their sales would be of raw milk, their discussion of the issue would lay the basis for a pasteurized A2 Brand to be introduced.

    More herd owners might use A2 certified labs and this makes the “A2 certified” brand in A2/A2 testing better known, and something is created that my survive the expiration of their patents.

    Free advice from a retired business school professor.

  8. Edward Miller says:

    Removal of A1A1 cows from a herd

    It seems that in addition to breeding from A2A2 bulls, herds can somewhat be improved by keeping A1A1 cows out. Rough calculations suggest a herd of 100 cows is going to have 80 calves, of which half will be female. If the average cow is used for 4 lactations, this means 25 will have to added to the herd each lactation cycle. If there are 40 females available and 25 needed, 15 will be removed.

    By selecting for A1/A2 status, the A1A1 females can be removed. This should reduce the amount of BCM7produced on digestion of the milk, and the cost appear not to be excessive. It might not be necessary to test all of the calves, since 15 might be found if only some were tested. Possibly after say 30 had been tested, 15 A1A1 animals might have been identified and could be removed from the herd. If normal commercial tests are used, the A2A2 animals will be identified during the process. This information will be available for use later if a full conversion to A2A2 animals is wanted later, avoiding the need for testing these animals again.

    Of course, the cost for removing A1A1 animals includes not only the costs of testing, but the possibility that the selection against A1A1 status (or against A1/A2 status once there were no longer A1A1 cows to be removed) would require giving less weight to characteristics such as appearance of health, and udder condition, or the production record of the mother.

    One reason for setting the above out explicitly is that it may avoid one or more A2Corp. patents which involve testing for A2A2 status.

    It is possible to remove identify A1A1 animals by only testing for the genetic sequence that produces A1 beta casein. This is actually cheaper than testing to determine if the animal is A1A1, or A1A2, or A2A2 which requires determining if the sequence for A1 beta casein is present and if the sequence for A2 beta casein is present).

  9. Edward Miller says:

    New Zealand Testing Patent Expires

    As of June 20, 2011, the possibility of having genetic testing for A1/A2 status in New Zealand became possible without infringing the key patent held by A2 Corporation.

    . From the New Zealand Intellectual Property Office I found patent 537363 expired June 20, 2011.

    This is the one on testing that seems to cover the obvious method of testing for A1/A2 status and appears to be broader than the US patent. They have filed for restoration. Perhaps anyone wanting to have samples tested should rush to have them done now.

    According to New Zealand patent law the renewal after a patent has lapsed is not automatic.
    (http://www.legislation.co.nz/act/public/1953/0064/latest/DLM280484.html?search=ts_act_patents+act+1953_resel#DLM280484). If “the failure was unintentional and that no undue delay has occurred in the making or prosecution of the application,” a renewal can be granted.

    The consistent failure of A2 to make payments on time on its patents may raise some question as to whether the failure to pay was intentional.

    There is provision for someone to file an opposition. Perhaps a public spirited citizens should file an opposition. It does appear there could be costs in bringing an opposition and problems for someone outside of New Zealand (besides difficulty in appearing in person).

    I do not know much about New Zealand patent law and how easy it would be to block a renewal of this patent. The law seems to say that in some cases the Commissioner must deny certain requests if the applicant has not acted with due diligence in meeting deadlines.

    Since it appears that A2 in recent years has failed to meet all the deadlines for renewal of their NZ patents, and then after the deadline requested a renewal, there is at least a suspicion that either the non-payment was deliberate, or there was a failure of due diligence. One missed payment may be a mistake, but that “due diligence” would a reasonably competent organization upon missing a deadline to learn from the mistake and change procedures so it did not happen again.

    This patent does not appear too critical to the world or New Zealand. LIC seems to be doing tests in New Zealand at reasonable charge, so that if this patent seems not to prevent cows and bulls from being tested in New Zealand. There have been references on the internet to people from North America sending samples to New Zealand for analysis.

    Comments on Testing Patent NZ 537363

    A first read this patent appears valuable and broader than the corresponding one in the US. It covered (past tense is used since it just expired due to non-payment of fees) the direct method of testing for the SNPS of interest. The patent even covers the idea of producing milk from a cow that had been tested in this way.

    This seems to confirm my impression that the US patent did not cover the most obvious method of testing, to directly test for the SNP’s of interest. It appears from the New Zealand patent that the direct method does work.

    My guess is that this direct method failed to meet the US standard of non-obviousness. I believe New Zealand may have a lower standard than the US. One source (http://www.med.govt.nz/templates/Page____1187.aspx) indicates that the invention must be “new, which means that it has not been published in New Zealand before.” This is a lower standard than the in the US applies where inventions must not have been made anywhere in the world, and not obvious to one skilled in the art. I do not know enough to know whether the use of SNP’s in the direct manner would have been published in New Zealand earlier.

    Also, someone may wish to avoid A2 patents by having the tests done in a country where A2 does not have relevant patents.. They may also wish to avoid having their results sent to A2 Corp,. as happens if the test is done at the U. of Cal. at Davis.

    Even if the technique is “obvious to one skilled in the art,” there are often various details that take time to figure out. The NZ patent provides a detailed description of the procedure that can be supplied to a lab new to this test. Possibly, a
    US lab could be persuaded to use this procedure to conduct the tests, since it appears different from the one that A2 has a US patent on.

    Here is some background material:

    From the Intellectual Property Office web site:

    Patent Details Patent Number (11) 537363 Current Status Expired or not Renewed International Application Number PCT/NZ2003/000102 WO Publication Number WO03/100074 Patent Type Patent PCT Inward Patent Title (54) Animal genotyping method Filed (22) 23-MAY-2003 Nat 22-DEC-2004

    and further below
    “Section 35 Application for Restoration Filed 22-JUN-2011 22-JUN-2011 Lapse 20-JUN-2011 20-JUN-2011 Send Renewal Non-Compliance 20-JUN-2011 20-JUN-2011″

  10. Edward Miller says:

    If A2’s patents are a problem there is at least one other testing technique available.

    From a Dexter Board posting:

    The A2 Milk Company was not the first to develop a genetic test for A1 and A2 Beta Casein. They didn’t “discover” A2 Beta Casein nor the gene that codes for it. They do have a patented test for this gene, but their test isn’t the only test for this gene. Please check out the following reference and take note of the publication date:

    Genotyping bovine milk proteins using allele discrimination by primer length and automated DNA sizing technology

    Authors:
    1. M Lindersson,
    2. A Lund¨¦n,
    3. L Andersson
    Published: Animal Genetics Volume 26, Issue 2, pages 67¨C72, April 1995

    Department of Animal Breeding and Genetics, Swedish University of Agricultural Sciences, Box 7023, S-750 07 Uppsala, Sweden
    *Correspondence: M Lindersson

    Summary
    A method for genotyping K-casein (A, B, E), Beta-casein (A1, A2, A3, A5, B) and Beta-lactoglobulin (A, B) simultaneously by the use of allele discrimination by primer length combined with automated detection of fragments with a sequencing instrument is described. Seven different mutations within the milk protein genes were analysed in order to distinguish between the alleles examined. The samples were amplified in two separate multiplex polymerase chain reactions (PCRs), which were then pooled and separated according to size in a single lane on the gel. By using stringent PCR conditions, we have been able to achieve allele-specific amplifications and minimize amplification of mismatched primer for all seven mutations.

    Honestly, how can the A2 Milk Corporation be awarded a patent claiming that they “invented” the breeding of bovine bulls that do not have DNA encoding for Beta-casein A 1 with bovine cows that do not have DNA encoding for Beta-casein A 1 and then milking the progeny cows???

    Don’t you understand the repercussion of this? That they would then “own” rights and therefore be entitled to royalities and/or licensing fees on any production of bovine milk known to be devoid of A1 Beta-casein? This would apply regardless of what test was used to determine A1 and A2 Beta Casein status. Do you really think that this is okay???

    Patti

    Read more: http://dextercattle.proboards.com/index.cgi?board=milk&action=display&thread=1053&page=2#ixzz1QRkMqc61

  11. Edward Miller says:

    Prior Art relating to Selection for A2A2 Animals

    I commented earlier that the newly issued (2011) US Patent 7,863,002 (McLachlan inventor assigned to A2) seemed rather obvious. The idea was to test for A2A2 status and then select any animals found to be A2A2. I speculated that a literature search might show others had had the idea earlier.

    I found you could do online searches of the Journal of Dairy Science. Very quickly I discovered that there was a large literature in which people had used various genetic markers and correlated various traits of dairy cows with them. I have not yet unearthed a case where cows were actually selected, but it was obvious from the context that the idea was that these markers would be used to select cows for either breeding or milk production on the basis of the markers.

    Several articles are given below in which the beta casein system was one marker, and data on A2A2 was collected. Genetic status was not determined by DNA samples in the earlier ones, but the DNA alleles were identified by protein tests and the genetics were well understood at that time.

    For instance the 1977 article by Mather cited below found that A2A2 status (code is 22 in some tables) could be an useful marker and in the summary says “Use of such information as an aid in selection of animals at a much earlier age than is now possible shows promise.”

    LIN and McALLISTER writing in March 1986 reported on a study that included measurement of beta-casein and concluded:

    “The use of milk protein types as an aid for sire selection is feasible at present if mates and daughters of young sires are typed for milk proteins.”

    I would like to thank A2 Corp for drawing attention (in the documentation for the Morris patent) to the work of Bovenhuis et al. who reported in September 1992 that:

    “Because of these associations, interest in selecting for favorable milk protein genotypes is considerable.”

    and in the same paragraph:
    “Therefore, before selection for milk protein genetic variants is incorporated into the breeding program,…”

    Bovenhuis et al did analyze the effect of A2A2 genotypes although he did not directly suggest using A2A2 status for cow selection. However, his discussion does suggest that using the B and A3 alleles might be useful. However, in the summary he did say: “Selection would then be for animals carrying the favorable lC -casein B allele in combination with the B casein AI, A2, or A3 alleles.”

    Incidentally, the citing of this article in a patent application byA2 Corp. filed in 2002 is interesting. US law requires that you inform the patent of office of any prior art you know of at the risk of having your patent declared invalid. This does seem possible prior art to me regarding the McLaclan patent on using A2A2 status for selection.

    The research of Ng-Kwai-Hang et al found in December 1990 that Variant A2A2 is superior to A2A1 in milk production. However, the fat content was lower. Incidentally he casually refers to several earlier studies of the association of beta casein types with milk protein content. He does not actually suggest selecting cows on the basis of beta casein types, nor does he suggest selecting cows on the basis of other genetic test. However, in his summary he does suggest that “selection of the proper genes for B-lactoglobin and K-casein would clearly improve protein content of milk.” This leaves little doubt in my mind that he would have suggested using A2A2 genotype for cow selection had his data been different. Using beta casein genotype was in the prior art well before the work of McLachlan.

    This is cited in the references for this patent 7,094,949 (twice) so perhaps for this patent it was not considered relevant prior art, or possibly the patent examiner did not read it or think about it.

    In the 7,563,575 (McLaren inventor) patent on breeding A2A2 animals, and for the 6,570,060 patent on producing mill to prevent heart disease, and in 7,094,949, so perhaps for this patent it was not considered relevant prior art.

    Incidentally, the above paper might constitute prior art with regard to the A2 Corp. US patent 7,851,147 based on the work of Michael Lee, although it dealt only with fat content, not the ratio of unsaturated to saturated fat.

    I suspect further research show prior art relevant to Patent 7,563,575 (McLaren inventor), which claims the idea of breeding a bovine cow or bull of the A2A2 type (fancier words are used, but this is what is said) by inseminating a cow of type A2A2 with semen from a bull of type A2A2 just might show that someone skilled in cattle breeding had developed either this idea, or one so close to it, that one skilled in the art would have thought of this.

    According to US law:
    35 U.S.C. 102 Conditions for patentability; novelty and loss of right to patent.
    A person shall be entitled to a patent unless –
    (a) the invention was known or used by others in this country, or patented or described in a printed publication in this or a foreign country, before the invention thereof by the applicant for patent,

    This might also apply to US patent 7094949 which is somewhat similar, but adds the idea of milking the cows so bred. For those skilled in dairy science, has the idea of obtaining a desired type of milk by milking cows after breeding them for the desired trait been thought of before?

  12. Edward Miller says:

    Elliott Prior Art over McLachlan

    This brings up the interesting question of whether McLachlan was entitled to his patent 6570060 under US law.
    “What is claimed is:

    1. A method of producing milk suitable for use in the treatment or prevention of coronary heart disease from one or more lactating bovines which milk is substantially free of .beta.-casein A.sup.1 but which contains any one or more of .beta.-caseins A.sup.2, A.sup.3, B, C, D and E, the method including the steps of: (i) testing DNA or RNA from cells containing DNA or RNA obtained from one or more lactating bovines for the presence of DNA or RNA encoding .beta.-casein A.sup.1 ; (ii) selecting bovines which do not have any DNA or RNA encoding for .beta.-casein A.sup.1 ; and (iii) milking the selected bovines.”

    The first thing to notice is that he is claiming not a way to produce milk that is believed to be useful “in the treatment or prevention of coronary heart disease” but milk that is “suitable for use”. Thus, if A2A2 milk is shown not to be useful in this way, his patent fails. If he had claimed it this way, anyone who did not believe A2 type milk was useful for this purpose would be free to use the technology.

    More relevant here, is that in assuming A2 type milk is useful for this purpose, he is claiming a way of producing such milk. His claim then covers anyone who produces A2 type milk as described, even if for some other purpose such as preventing autism, or preventing diabetes.

    This naturally bring up the question of whether anyone else might have invented the proposed technique for producing A2 type milk earlier. His priority dates to May 16, 1995 when he filed for a patent in New Zealand. He is entitled to a one year grace period, so if he invented it a year earlier, if he could prove he had invented it, and had not abandoned his invention, he is entitled to patent the idea. However, if someone else had figured out how to produce A2 type milk earlier than he did, either that other person is entitled to the patent, or if the invention was obvious in view of the prior art, he is not entitled to a patent.

    There is a patent application in New Zealand dated April 11, 1994 by Elliott and Hill which covered producing A2 type milk. Their patent covers selecting cows by the type beta caseins in the milk they produce, so they knew of that technique then. (I will later discuss a US patent by Elliott and Hill that appears to be the same invention as McLachlan patented that derives its priority from this patent).

    I believe it was well known to someone skilled in the relevant art, which I believe is dairy science, that the type of beta casein produced by a cow is genetically determined. It follows that discovering the type of beta casein produced tells one the genotype of the cow. It is a genetic test.

    Incidentally, all tests that use the DNA are still determining the genotype by a phenotype, here a characteristic of the DNA fragments left after fragmentation by restriction enzymes, duplication by a polymerase chain reaction, and then I believe electrophoresis (if Southern blotting is being used). I believe at a final stage one is examining the diffusion of substances through a gel. I believe the milk protein test also ends up using electrophoresis also, but uses protein fragments. (I am not expert at testing so I may be completely wrong here).

    Given the Elliott and Hill disclosure, I believe the idea of using another genetic test, one based on DNA would have been obvious to one skilled in dairy science. Thus, I would argue the Elliott and Hill patent would have made the McLachlan invention obvious to one skilled in the art, and hence non-patentable (It is not necessary for McLachlan to have learned of the technique from Elliot and Hill, for their disclosure to make his idea non-patentable).

    That Elliott and Hill introduce their patent applications by reference to diabetes, and McLaclan by references to coronary heart disease is irrelevant. Both are claiming a process for producing A2 type milk. There is but one type of such milk (which cannot be patented because it is not a “new composition of matter”).

    Both have the idea that milk substantially free of A1 beta casein can be produced by milking cows of the A2A2 genotype. They differ in how the genotype is determined, but to one skilled in the art as of 1994, the idea of using a tests involving DNA would have been obvious. Many years earlier it had been discovered that DNA carried the genetic information and that was common knowledge by then among biochemists, and biologists.

    I am a little surprised that they did not draft a broader claim than they did. I have not seen the original NZ patent application, but possibly it did cover something broader.

    There is a US patent (7,157,616) with Elliott and Hill listed as inventors which claims as follows:

    “1. A method for selecting cows whose milk is not diabetogenic to susceptible individuals which comprises determining the genotype of said cows and selecting those which produce non-diabetogenic milk which contains a .beta.-casein variant with proline at amino acid position 67 and does not contain diabetogenic varients of .beta.-casein which have a histidine at amino acid position 67.”

    This claims is not a method for producing milk which is “believed” to be non-diabetogenic, but a milk which not diabetogenic. This milk is A2 type milk. Again, if A2 milk proves not to be non-diabetogenic, the patent may be invalid as describing a process that does not work. However, the question of whether A2 type milk is non-diabetogenic, while important, is a side issue here.

    Elliott and Hill talk about “determining the genotype” and mention amino acids at position 67 while McLachan just refers to DNA tests, but to me they are essentially the same inventions.any genetic tests that works will determine whether the DNA codes for a histidine at position 67 (although A2 also hold another patent for a genetic tests which does not involve directly determining which amino acid will be placed at position 67).

    The important point is that the US appears to have issued two patents covering what appear to be the same process for producing A2 type milk. This should not have happened.

    I am not absolutely clear what the priority date on this Elliott patent is. At the beginning it gives the Foreign Application Priority Data as Apr 11, 1994, deriving from New Zealand patent 264862. If this is correct, it had clear priority over the McLachlan patent, and the McLachlan patent should not have been issued as written.

    A natural question is why was this problem not discovered. Possibly the examiners were not aware of the other applications, and did not notice a conflict. However, the Elliott US patent does mention under other patent 6570060, which is the first McLachlan patent. Thus, I presume that examiner did not conclude as I did that the two inventions were essentially the same, or alternatively realized the Elliott and Hill had priority.

    Looking at the McLachlan patent (6,570,060), I do not see any mention of the Elliott and Hill patent applications in the US, or New Zealand, or Australia. However, they do say:
    ” Epidemiological evidence strongly suggests that dietary β-casein A1 is harmful to human health. For example, WO 96/14577 describes the impact of β-casein A1 on Type I diabetes. The epidemiological evidence suggests that β-casein A1 stimulates diabetogenic activity in humans. Furthermore, WO 96/14577 describes the induction of autoimmune, or Type I, diabetes in the non-obese diabetic (NOD) mouse model by way of consumption of β-casein A1. The invention described focuses on reducing the risk of contracting Type I diabetes in a susceptible individual by restricting the milk or milk product intake of that individual to milk containing only non-diabetogenic β-casein variants..”
    Notice the above does not mention that said milk is the same milk as the McLachlan patent discusses, nor that the patent has a process for producing said milk (which appears essentially the one they are asking for a patent on).

    US law provides for a duty to disclose to the patent office facts that are material to patentability, including prior art. The relevant regulations are at http://www.uspto.gov/web/offices/pac/mpep/documents/appxr_1_56.htm

    The key sentence is: “However, no patent will be granted on an application in connection with which fraud on the Office was practiced or attempted or the duty of disclosure was violated through bad faith or intentional misconduct.”

    On section of the US code is:
    “35 U.S.C. 288 Action for infringement of a patent containing an invalid claim.

    Whenever, without deceptive intention, a claim of a patent is invalid, an action may be maintained for the infringement of a claim of the patent which may be valid. The patentee shall recover no costs unless a disclaimer of the invalid claim has been entered at the Patent and Trademark Office before the commencement of the suit.”

    This part of the law (notice reference to “without deceptive intent”) raises a risk that deception in getting one claim may prevent enforcing a valid claim. The law here is complex and Therasense v. Becton Dickinson (May 25, 2011), has apparently changed the rules.

    A natural question is whether A2 knew of the Elliott and Hill invention claims, and that they might overlap (or even duplicate the McLachlan one). It is clear they did. They owned a half interest in the Elliott and Hill US patents (probably at the time only applications). According to Devil in the Milk, (p185), Fonterra and A2 were involved in extensive legal actions in Australia over the two sets of patents, only ending 2006.

    At first glance, it does appear that “fraud on the office was practiced or attempted”. However, it is possible that the US applications were prepared by US lawyers who were unaware of the broader picture (the McLachlan patent was handled by Young & Thompson and the Elliott and Hill one by Knobbe, Martens, Olson & Bear, LLP). The applicant has a duty to submit specific forms containing information about possible prior art and the rules are complex (see http://www.uspto.gov/web/offices/pac/mpep/documents/appxr_1_97.htm#cfr37s1.97
    and http://www.uspto.gov/web/offices/pac/mpep/documents/appxr_1_98.htm#cfr37s1.98).

    I do not have access to all of the relevant documents, so I cannot be sure something was left out, rather than the patent office not noticing the issues (since it does call for close reading and thought).

    I have seen advice that when in doubt, mention the possible prior art, because the penalty is so great if you do not, if it comes up later in litigation. However, little is lost if it is determined not to be relevant.

    A natural question is why Fonterra fought in Australia, but not in the US. I gather Woodford has a transcript of those proceedings and he may be able to tell if the arguments I raised above came up there or not. Australian law is different from US law (and I am not sure I understand either) so the relevant issues might have been different, although the key question of who invented what when is probably relevant in both jurisdictions. I can imagine the question of to what extent protein tests should be considered as revealing the genotype probably came up.

    Background

    In most countries when there are two applications for the same invention, the first to file wins.

    However, the US uses a first to invent standard. However, in this case it does not appear to make a difference which standard is used. The earlier priority date for Elliot and Hill seems to give them the victory, since their priority date is more than a year earlier than McLachlan’s.

    If the dates had been closer, what could have happened is called an “interference” procedure. which determines who should get the patent. Normally, he one who could show he was first to invent (and had not abandoned his invention) gets the patent.

    I do not know what Elliott and Hill knew and when, but I can guess. Hill worked in dairy research. Devil in the Milk reports that Elliott called Hill in 1993 and asked about different milk proteins. If Hill knew enough to mention beta caseins variants, he almost certainly knew that which types were produced was genetically determined. If by April 11, 1994, this team knew enough to file for a New Zealand patent on how to produce A2 type milk, it must have occurred to them that if there was a genetic test, it could be used to select cows. It seems to me that Elliott and Hill probably anticipated the McLachlan invention, and he should not have been issued a patent, at least not as written. Ideally, they or their lawyers would have made sure the claims were broadly written in the initial application, mentioning a DNA test even if they did not know how to do one then.

    US law allows an inventor a one year “grace period” between when he makes an invention and when he files, in which he can get a patent even if someone else files first. If Elliott and Hill had the idea of using the type of genetic tests that involve testing DNA directly, instead of the type that uses proteins produced, before about May 16, 1994, they would have gotten the patent. May 16, 1994 is a year before the McLachlan filing, (although US law permits of use of mailing dates in certain circumstances, which might give extra days, but from the location of the patent attorney used I suspect there was no mailing, but a hand delivery). The patent issued to Elliott and Hill has a priority date of April 11, 1994, which is earlier than the critical date. This is the date when the US believes they had reduced their invention to practice.

    In giving them the second patent mentioning genotyping , it appears the US examiner believed Elliott and Hill’s original idea included genotyping. I wonder if this meant they disagreed with the Australian authorities, or whether the issues there were different.

  13. Edward Miller says:

    Implications for A2 Corp of Short Period to Go on Patents

    My current calculations allowing for the US filing date plus twenty year, and adjusted to for the terminal disclaimers the submitted (limiting the term to that of the parent patent when the other patent is a derivative of the first) and the relevant patent term adjustments (extra time for patent office delays) make the expiration date June 3, 2016 for the four McLachlin patents, and Nov. 3, 2015 for the Elliott patent using type of milk, and Feb. 8, 2017 for the Elliott patent using genotyping, and March 15, 2026 for the patent on a testing method.

    If I am right they have only a few years of really solid protection left, and given that it might take several years for an A2 brand to be launched, they may need to do something soon. In essence, they risk losing the “nuclear device” of a permanent injunction threat. as a way of protecting their licensees. Without this, firms are much more likely to decide to proceed on their own, taking the risk of an infringement lawsuit.

    A2 Patents Are Strongest Against Farmers, not Bottlers

    If the bottler is not a producer of A2 type milk, they will be in a weak position to bring a winning patent infringement case. This is because their strongest patents related to producing A2 type milk, A2 has stronger weapons against farmer’s than against bottlers, but the difficulty in discovering infringers and the small size of farmer’s makes it unlikely they can collect much from farmer’s others than a moderate fee for testing.

    They probably should settle for such a small royalty on testing.

    In considering the time frame, it is important to look at the weapons a patent holder has. In an infringement case these are two, damages, and an injunction to stop the infringement Since the injunction weapon is time limited, I will discuss it first, since that is the one whose value is rapidly disappearing.

    The Injunction Weapon

    In many cases, an injunction is by far the most costly to an infringer, and the threat of this is the “nuclear weapon” in a patent case. This forces a firm to shut down their infringing operations. If a firm can be forced to stop the infringement, they may incur costs much higher than any potential profits from infringement, and much higher than any damages they might have to pay. If a firm cannot sell their already produced inventory, or must scrap a specialized factory, or to discontinue an establish brand, the costs may be very high. These costs can easily exceed by far whatever benefit the infringer was getting from the infringement, and can also exceed the damages (which in logic are tied to the benefits).

    For a milk product, the benefit would be being able to claim the produce was absent A1 beta casein, which would help in selling. For a breeder (or semen seller), it might be being able to say their animals were A2A2, which might bring a higher price. These are benefits, but not worth much.

    However, if a farmer was forced to scrap its inventory (dump its milk) or destroy its animals, the cost would be very high. His basic equipment, land, and buildings have other uses and could be diverted to producing other types of milk easily. It is unclear whether an injunction could be worded so as to make his animals useless for producing milk or breeding it him. It is possible since the patents refer to producing milk from cows bred in certain ways or to breeding in certain ways. A2 would try to argue that any production of milk, or sale of cows bred or semen from bulls bread in those ways constituted infractions and could be blocked by an injunction. these costs would be very worrisome for a farmer, and the threat of them in a powerful weapon in A2 armory.

    While for milk bottling and product production, there is little specialized equipment involved, there are brand development expenses. An injunction could for a bottler or milk product producer write off expenses spent brand development, packages already bought etc. If someone spends a lot of money developing a brand and persuading customers to try it, being forced to discontinue the product or change it to just another “premium” brand, would impose large costs.

    Some of the A2 patents involve milking a cow selected in certain ways. An injunction to stop infringing would imply stopping milking. Because cows stop lactating if not regularly milked, even a short shut down cold be very expensive. A threat that A2 could force a farmer to stop milking his cows would be a powerful negotiating tool.

    If A2 could get an injunction that prevented a semen seller from selling the semen it had already produced using A2 technology, this would impose very high costs on this semen seller, far higher than the extra profits it might have made from the infringement. However, while an injunction would prevent both selling and producing the offending semen, I believe it would permit storing it. Already frozen semen might be store until the expiration of the relevant patents. Fresh milk does not store. UK law apparently gives a patentee holder to power to prevent an infringer from keeping an invention, but I have not found a similar provision in the US. Hence, an injunction might prevent selling, producing, or using an infringing patent, but leave the infringer free to store any product already produced until the patent expired.

    Injunctions can be preliminary or permanent. The permanent ones are issued after the case is over and the patent shown to be valid and infringed. A preliminary one can be issued earlier if the court is persuaded the conditions will be met:

    (see http://www.tms.org/pubs/journals/jom/matters/matters-9712.html):

    ” The plaintiff has demonstrated a reasonable likelihood of success on the merits of the case (i.e., that the patent in issue is valid and infringed).
    • The plaintiff will be irreparably harmed if the injunction is not issued.
    • The threatened harm to the plaintiff outweighs the harm the injunction may inflict on the defendant.
    • The injunction will serve the public interest. ”

    A motion for a preliminary injunction by A2’s attorneys would be expected. However, I would not expect it to succeed for several reasons. The applicable A2 patents are relatively weak, involving rather obvious applications of scientific discoveries (which themselves are non-patentable). It will be hard to persuade a judge that they will be fund valid. A reasonably smart potential infringer will have a business plan that does not obviously infringe (for instance, a farmer will have valid reasons other than A1/A2 status for selecting his semen).

    As long as A2 (or a licensee) is not even producing milk or breeding animals in the US it will be hard to argue irreparable harm if the injunction is not issued. In view of the small harm to A2 from a single infringement, they will have trouble arguing that the threatened harm to them outweighs the harm the injunction may inflict on the defendant. This will be especially true where A2 is seeking the “nuclear deterrent” type of injunction that would severely hurt the defendant.

    There is currently considerable uncertainty as to the ability to profitably market A2 type milk in the US (as shown by the previous failures, A2 difficulty in finding a licensee, and the limited successes in Australia and the US). If a infringer succeeds, (and is then stopped by a permanent injunction), A2 will have a case to point to showing the product could be marketed. successfully in the US. The milk market is regional due to transportation costs. Having a infringer in say New England might make it harder to for a licensee there. However, in the rest of the country, potential bottlers under the a2 brand would be very encouraged if they could see such a milk was succeeding, and A2 would actually find it easier to persuade firms that such milk could be marketed.

    Au unique feature of the A2 type milk industry is that a major cost is converting herds, and this makes it difficult for a bottler to acquire suppliers of bulk milk. If a marketer is succeeding in one region, farmer’s may notice and start converting their herds, making it easier in other regions for an A2 licensee to find supplies. Another problem is informing consumers of what A1 beta casein is and why milk containing it should be avoided. This will be a slow process and a new entrant will probably be incurring considerable expense in doing so. If A2 wins its infringement case and gets a permanent injunction forcing the other firm out o business (or at least out of selling A2 type milk), a new A2 licensee in the area will be able to enter a market where the consumers are already somewhat educated as to what A1 beta casein is, and where there are farmer’s with A2A2 herds willing to supply milk. If the infringer had been profitable, a new A2 licensee can be persuaded there is a market in that region.

    Indeed, A2 should at least consider resisting its lawyer’s normal tendency to seek a preliminary injunction and consider letting the entrant do the market testing, consumer education, and herd testing to lay basis for its licensee (if they can find one). When (and if) they win the case, they will collect damages, and use the threat of a permanent injunction to negotiate a good license terms with the infringer. If not, it should be easy to recruit an a2 licensee given there is evidence the product can be profitably marketed in the area, there are consumers educated to know why to avoid a1 beta casein, and there are farmers withA2A2 herds who need a place to sell their milk (and have just lost their purchaser).

    It should also be noticed there is a public interest consideration in considering a request for a preliminary injunction. This usually is not a major issue. However, it could be a problem for A2. Their key patents involve a milk that either helps prevent diabetes, or helps prevent heart disease. These patents are not infringed if the defendant’s milk do not protect against diabetes or heart disease. A2 will have to argue that their milk does provide protection. It then follows logically, that depriving consumers of this milk will increase these diseases, and the public interest would seem to be hurt by taking such milk off the market. this would make it hard to get a preliminary injunction.

    Even if a preliminary injunction is obtained, it will likely take a while and may be delayed as appeals are taken.

    More likely, A2 will not get a preliminary injunction and their “nuclear device” threat will be a permanent injunction. This will require discovering the potential infraction, winning a law suit, and probably winning on appeal. It gets its permanent injunction then only if the patent is still in force, and the injunction holds only until the patent expires. If the expiration date is close, the option of storing the product (say semen) for sale after expiration may moderate the effect.

    Thus, the approaching expiration of A2s patents can deprive them of one of their most important negotiating weapons, the threat of a permanent injunction.

    There is one other obstacle to a preliminary injunction. If A2 fails to win the case, it owes the defendant damages for the losses the defendant suffered from a preliminary injunction. The plaintiff (A2) normally posts a bond to cover the loss caused by the preliminary injunction in case they fail to win the case (such as could happen if prior art turns up). Naturally, in the “nuclear device” type case where an injunction would do the most to hurt the potential infringer, the bond will be the largest. While bonds can be issued by others, the above source indicates they cost about 10% of the amount of the bond. This source report the expense of the bond alone often keeps plaintiffs from seeking a preliminary injunction. A2 Corporation is a small company without large cash reserves and this bond requirement would probably be prohibitive, at least where the threat of an injunction would be a real deterrent.

    However, just because an injunction is such a powerful weapon, A2 is unlikely to be able to use it until they have won a case, and any appeals. If there is an appeal, the potential infringer could probably delay the effect of the injunction until the appeal is resolved. The risk for A2 is that by then, the patents would have expired, and the basis for the injunction would have disappeared.

    Notice in all of these cases, the ability of A2 to use its “nuclear weapon” is time limited. Once the patent expires, they weapon disappears, and they must settle for damages.

    Admittedly, paying damages would be bad for an infringer, but probably cost him much less than an injunction would have. Thus, the first question someone thinking of adopting a business plan that might infringe a patent, is, “Is the patent expiration date close enough that A2 could not get an injunction before it expires.”

    If the expiration date is close, they may realize that the worst that can happen is having to pay damages. In exchange they get a “first entrant” advantage in a potentially profitable market, given the weakness in many patents (was it really patentable, is prior art close enough to invalidate the patent, does a particular business plan really infringe, etc.) and the high cost to the patent owner of discovering possible infringements and litigating a case to a conclusion, a potential infringer who sees the expiration date approaching, is to decide to proceed. the A2 patents are vulnerable on issues such as being obvious given the science. A2 would have real problems in discovering possible infringements and winning cases.

    If forced by a lawsuit to stop production, a processor would lose a heavy investment in brand development (the books may not show these losses as a capital item, but incurring several years of losses to get established is really an investment). Thus, a2 may be able to force a settlement by this threat. However, a bottler or processor may be able to stop infringement by such methods as no longer requiring that the milk come from A2A2 cows, or making essentially zero A1 beta casein content a criteria in buying milk. In practice, this would result in some A1 beta casein slipping into their milk supply. This might force them to abandon a claim to be A1 free, possibly falling back to a claim of being very low in A1 , and testing and announcing the A1 beta casein level.

    Even if this happened, they would probably stay in business. Seeing the expiration date of the patents approaching, they might plan on waiting until the patents expired, and then again limiting their milk purchases to A2A2 milk, and resuming advertising milk substantially free of A1 beta casein.

    However, if they kept buying from the same farmer’s as it appears they could and would, their milk supply might stay very low in A1 beta casein. These farmers would often have planned on using A2A2 cows and impregnated their A2 cows with A2 semen. If nothing particular happens, even after the bottler changes rules (to stop infringing) these A2 cows will give birth to A2 calves that become A2 heifer and then A2 cows producing milk with no A1 bet casein. It could easily be 2 years, 9 months before and actual change in the milk from the herd appeared.

    However, it is possible the farmer (if not himself a defendant in the A2 case) might continue to use A2 semen and keep his herd A2A2. He may realize that by the time the calves from the inseminated cows had been born and were producing milk, the patents would have expired and the bottler would again be demanding either that there be no A1 cows in the supplying herds, or no A1 beta casein in the milk. The farmer may also realize that even if this bottler was no longer around, that there would probably be purchasers willing to pay a premium for A2 type milk and plan on retaining his ability to supply such milk. The cost of maintaining this ability would be low.

    Thus, as soon as the injunction expired, the bottler might be able to resume producing A2 milk. In the extreme, an injunction that prevented them from selling the milk they had produced in violation of a patent would force them to dump it. However, since bottlers keep very low inventories this would not be a disaster, and even a few days notice could prevent them from having inventory on hand.

    Thus, for bottlers, an injunction would be bad, but not fatal.

    The Non-Practicing Entity Issue

    However, if a2 brings a lawsuit and requests an injunction forbidding sales, I doubt if they would get it quickly. The general rule is that once a patent has been fund valid and infringed, a permanent injunction can be issued. See http://www.georgemasonlawreview.org/doc/14-4_Jones.pdf)

    The above article brings up an important issue for A-2. It appears harder to get an injunction against infringers for “Non-practicing entities”. The ebay vs Mercantile case is discussed at: http://en.wikipedia.org/wiki/EBay_Inc._v._MercExchange,_L.L.C.
    “Non-practicing entities” (sometimes called patent trolls). are firms that do not actually use their inventions but merely seek to collect royalties.

    I do not know if A2 would be considered non-practicing. They do not now conduct any operations in the US and if they were bringing an infringement suit, the defendant would try to argue they were non-practicing and should be denied the benefit of an injunction. Since A-2 ‘s business plan involves actually producing bottled milk and milk products, they certainly would have a strong case for arguing they were not a non-practicing entities.

    However, A2 would be in a stronger position if they ever do need to bring an infringement actions if they were actually in the business within the US of producing milk and selling it when they brought the action. This is one more reason for them to get at least one US licensee, or a joint venture arrangement where milk is actually produced and/or bottled.

    The Magnitude of Damages

    One discussion of damages is at http://jolt.law.harvard.edu/articles/pdf/v05/05HarvJLTech095.pdf.

    The Supreme Court has held damages should be based on what the patent holder has lost due to the infringement. A2 is likely to have trouble collecting large damages, and in turn, the deterrent effect is much less than the threat of an injunction.

    Since A2 does not produce milk they cannot have lost sales to the other firms. At most, they have been deprived on royalties on the other firm’s sales. There would be scope for arguing over what a reasonable royalty rate would have been, which I believe would be what would a reasonable firm had been willing to pay. This is obviously debatable, but a firm would be unlikely to offer an amount larger than the profits they expected (and probably much less). On this reasoning, A2 might get a payment based on the sum needed to give them all the profits of the infringer during the infringement period. However, because losses are to be expected in the first years, even on this basis the total damages are unlikely to be very large. Let us look at what the profits might be in the first few years.

    According to Pincus, one of the key elements in the Panduit test (US Sixth circuit) is the demand for the product and the plaintiffs production and marketing ability to supply the market. A2 is likely to have a problem here. there is no demonstrated demand in the US for A2 milk. Also, A2 does not have any milk plants or farms in the US. It is easy to argue they lost no sales due to any infringement. In Datascope v. SMEC the infringer held 4% of the market and 13 percent of sales were made to foreign customers. Because the patent holder lacked the capability to market to these customers, the court refused to aware profits from the infringer’s foreign sales. A2 will have problems arguing it had the ability to market milk in the US.

    Examining the court cases, A2is unlikely to get very large damages even if it wins a case. As Pincus points out the infringer’s most valuable resources should be in pointing ut he lack of value in the patented invention. That a2 milk has not sold well when market in Australia and in New Zealand is evidence that the patented invention is of low value. That the one time the produce was sold in the US, the sales last only short time, and that after years of trying, A2has not been able to introduce the product at all suggest the invention is of low value (of course, this is market value, not social value).

    Notice, that the longer the period without a successful introduction of A2 milk into the US, the easier it will be for an infringer to argue the patent had low value, limiting damages. This argues that A2 should try to get the product introduced just to avoid the above argument being made.

    The above analysis shows that even after (and if) establishing infringement of a valid patent (difficult), A2 would be unlikely to win appreciable damages based on lost profits. Courts will then fall back on awarding a reasonable royalty.

    Pincus does point out that the court will expect the patentee to come to it with “clean hands.” In this case it will be handicapped if it held a valuable invention that could have saved many lives and just sat on it. The court will not be sympathetic and argue the patent could not have been very valuable if it did not actively try to use it. the value of A2 to pay the required fees in New Zealand could be used against it, since this suggests they themselves did not value their patents highly (see Pincus p 131).

    Looking at the above arguments it seems that even if A2 wins an infringement case, the damages will be base on a reasonable royalty rate. This has much less of a deterrent effect that a permanent injunction. Thus, as the expiration date approaches A2’s ability to threaten potential infringers drops.

    The time Delay Before A2 Even Discovers a Possible Infringement

    It should be realized it would probably take a long time for a firm planning to launch an A2 type brand to get organized and begin sales. A2 is unlikely to discover these preparations, even if they involved infringing their patents. A major source of delay will be finding farmer’s willing to convert their herds, and the time needed for the conversion.

    A2A2 cows look just like other cows. Even if the farmer was breeding A2A2 cows using A2 Corp’s intellectual property, this would not be discovered by looking at the cows. It is unlikely they would learn of the infringement from suppliers or employees. Except for purchased semen and cows, all of the supplies needed are the same as for any other dairy farm. Even if A2 somehow found out that they were using A2A2 semen, there are many reasons for doing so, and it is likely at any time there are thousands of farmer’s doing so. Farmer’s sometimes pick a single bull and use it for a year or so (using a single bull for longer than that would be unwise because of inbreeding problems). A farmer may be planning to convert just part of his herd, so his semen purchases will look even less unusual.

    Employees are unlikely to say anything (especially if asked to sign non-disclosure agreements on being hired). Breeding decision are likely made by a single individual. Other workers will probably neither know or care how semen is selected, or how decisions are made on which cows to sell, or to put in which herds, etc. Even employees that knew the farm was trying to assemble an A2A2 herd would probably not realized A2 Corp. had a patent that related to that.. In any case they would have nothing to gain from telling A2, and a lot to lose. They might be fired if their boss knew they had told A2, and if he never found out they still might lose their jobs if A2 brought a case that forced the farm out of business.

    The one hope A2 might have of learning infringement was occurring would be through the U. of Cal. at Davis, which gives them all the information on tests being done. It might be possible to deduce that a particular farm might be planning to build an A2 herd. However, there are probably other reasons for requesting testing than building an A2 herd., so knowing testing was being done might tell A2 little.

    However, it is naive to think a potential infringer would use Davis for the tests, and do so giving them full and accurate information. Tests could be done elsewhere, since there appear to be several labs doing the tests. Even if Davis was being used, it would not be hard to conceal what was happening by having the samples mailed from another address, or with another farm name, possibly broken into smaller lots. While if things got as far as litigation, the use of fake names might look bad, there are many reasons why someone may not want to reveal valuable commercial information to A2 (see my essay on the value of this information).

    The use of other addresses might be due to things like mailing from home, or from a farmer’s office address, or having mailings come from the addresses of different farms that were under common management.

    If the farm was trying to buy A2A2 cows or heifers from others, they might ask these farmer’s to have their animals tested. Suppose the farmer seeking to built a herd approaches another farmer, and asks him to test the 40 animals he has for sale, or might consider selling or trading. Perhaps only 10 will be A2A2. The farmer seeking A2A2 animals will have no use for the information on the other 30 animals. It makes no sense for him to pay for and keep the information on the animals he will not be purchasing.

    Much more sensible is for the potential seller to have the animals tested (possibly on the promise of a slightly higher price for any A2A2 animal discovered), and for him to keep the records on the animals he does not sell. He may have some use for the information, such as next time a potential buyer asks having the information available, or for making his own herd management decisions (breeding, or keep or sell decisions).

    With lots of requests of the above type coming through Davis, A2 will find it hard to figure out who, if anyone is trying to build an A2A2 herd. Even if they get a short list and send agents in to the field, it would be hard to discover what is happening, given that the cows look the same, and employees and suppliers are unlikely to talk.

    Eventually a farm may start producing an A2 type milk. How would A2 Corp. discover this? Of course, if there is a massive advertising campaign saying buy A2 type milk from X, they would probably discover it. However, any potential infringer would avoid using a2 as it is a trademark. It is legally difficult to make health claims, so the claims made are likely to vague and generalized. It is quite possible they would be missed by A2 Corp in New Zealand, or even a representative in a major US city such as New York or Chicago.

    The first introduction of a2 branded milk in the US was in one region, with the milk coming from one farm. They wanted publicity, and even had a story to tell, but the mention in the press was in regional publications of limited circulation.

    If a new milk bottler wanted not to have much attention from A2 Corp., it would not be hard to word any new publicity so as not to make obvious what was happening. Admittedly, a firm might lose a little free advertising this way, or have less effective initial publicity (a new good tasting brand is being introduced rather than specific accounts saying that its beta casein was all A2).

    A new entrant into the A2 market may not be planning to maximize sales in the short run, but get the first entrant advantage from which it can expand sales later, possibly after any bothersome A2 patents have expired.

    They may consciously decide to be a little less conspicuous, just to avoid unwanted attention from A2 Corp. and possible lawsuits. Also, they may not want to have A2 or another first beat them to a market and they lose the first entrant advantage.

    Among other implications, even if A2 Corp. was able to prove in litigation that they were trying to prevent A2 from knowing their plans, this does not necessarily mean they felt they were infringing and wanted to avoid patent litigation. Due to the nature of the market, there are good commercial reasons for not wanting a2 to introduce a brand ahead of them (and to sign up stores and farmers).

    The Time Lost Before A2 becomes aware of a possible infringement

    A2 may not be immediately aware when a potentially patent infringing introducing milk is introduced. Once they become aware of it, they may not find the firm doing the selling actually infringing, at least not in a easily proven way that they could easily win on. The strongest A2 patents related to testing, and producing milk from A2A2 cows, and breeding. Most likely the milk possibly infringing on an A2 process patent, will be sold by a store that does not produce milk, but buys it from a bottler somewhere, possibly from a distributor who buys from a bottler. A2 Corp. could lose some time in discovering just where the potentially infringed milk was being bottled.

    Find out who actually produced the milk and who may be infringing their patents could be hard, possibly involving following milk trucks or similar techniques. It is quite possible the bottler may produce several brands, one of which is A2 type milk, and the other ordinary milk. Milk is normally moved in bulk tanks trucks, stored in opaque tanks, and moved through pipes. It is seldom seen (except for samples drawn for examination), and in any case A2 type milk looks like other milk. If there are several types of milk produced at the plant, even if it was known that trucks that delivered milk there picked up at Farmer McDonald’s, it would not be known whether they were picking up potentially infringing A2 type milk, or ordinary milk, or possibly both.

    While there may be legal processes to help discover these things (the Discovery in a lawsuit), it is not clear A2 would have enough information to even bring the case, and begin to access these techniques. It is not clear that even showing that a particular bottler produced milk probably from exclusively A2A2 herds (along with other products) and that farmer McDonald sold milk to that bottler, would be enough to seek entry on to his property to learn more (and of course even seeing every cow and looking into every tank would not show infringement). Obtaining access to his records would have a similar problem, and would be time consuming even if it was eventually obtained.

    Recognizing that there are likely to belong lags between the start of infringement and when A2 could begin litigation and how long litigation and appeals would take until an injunction was obtained, indicates how close A2 is to lose its most powerful weapon, the threat of an injunction.

    The First Entrant Advantage in the A2 type Milk Business

    These first entrant advantages are two. One is that there are only a few herds that are easily converted, typically ones of minor breeds such as Guernseys. The first entrant can sign these up, and later entrants will have to sign up farmers whose initial herds are primarily other than A2A2, forcing them to buy many cows. If there is suddenly great publicity and many farmers are competing for these cows, they will be very expensive. The other cows to be sold will have little value beyond what meat packers will offer.

    Many stores will be willing to cry one brand, but only one brand of A2 type milk. Why one brand? For informed consumers, especially those with a family member who needs A2 type milk, they will seek out stores with such mil. Since fluid milk is not easily stored, they will have to buy it at least once a week. Since they will also need other groceries, they are likely to do all of their shopping at the store that carries A2 type milk. One very vulnerable group is young children, and those with child containing families buy much more groceries than singles, older married couples with no children, or young couples whose children have not yet come. Also, the early adopters are likely to be those willing to pay for a premium milk which means they are higher income and hence more profitable customers for a store. Also, in some case their opportunity cost is higher because the wage the shopper (typically a wife) can earn is higher, or they may be higher income because she works. For these mothers with high income jobs, time will be scarce and they are very likely to do all of their shopping at whichever store can give them A2 type milk.

    Thus, a smart store will want to have A2 type milk on sale even if it is a sort of “loss leader”. Here I do not mean that they sell below costs, but that the number of cartons sold and the apparent gross profit per carton may not appear to justify the cost of the cooler space, the expense of stocking one more brand, and the cost of any special advertising need to inform potential purchasers that they have it.

    However, once they have one brand, the second brand will not attract many new shoppers to the store. Shoppers sophisticated enough to look for A2 type milk will know how to read labels and research brands, and are unlikely to pick their stores based on it carrying a particular brand of A2 type milk. The high cost of adding a new brand and the cost of cooler space are likely to make it hard for a second brand, even if an a2 brand milk to be added.

    Thus, the first entrants will have a major advantage. If smart, A2 Corp. would be trying to get this advantage for their brand, even if it meant accepting lower patent license fees. Other smart firms may be entering just to get the first entrant advantage.
    Time to Complete Infringement

    Infringement occurs only when you have completed all of the steps in the patented process. Usually this is not important for procedures such as selecting cows for milking with tests.

    However some claims involve breeding and then milking the cows bred (such as US 7094949 and 7,157,616). This whole process is time consuming since the semen must be acquired, the cow impregnated, then there is the length of the pregnancy, then a calf is born, which must reach the age where she is impregnated, and milking is started when the calf is born. This whole process can take about two years and nine months. Only after this is completed has the infringement occurred. Thus, if my calculation of the expiration date as June 3, 2016 for patent 7094949 is correct, one might be able to start impregnations about October of 2014 and avoid infringement. However, such actions are also like to be covered by the Elliott & Hill patent (7,157,616) which covers essentially the same invention and which may expire later. However, some parts of a business plan may infringe other patents such as the one on selecting animals by A2A2 status.

    When the infringement depends on completing all the steps in the claim, even if infringement is shown the damages would be greatly reduced if limited to the cows who were being milked during the period of the infringement. One of the benefits of starting conversion early is to be ready if an when the patents expire, or conditions change.

    There are at least two reasons one may wish to start breeding programs in say October, 2014 (or earlier) even though they may appear to infringe certain patents. One is the patents you may be infringing is probably invalid because of prior art, or because they are too obvious (such as selecting by the results of a test) or because of some irregularity such as concealment of prior art, failure to register ownership, etc.

    The other reason is that as a practical matter, the chances of most possibly infringing actions being discovered and leading to lawsuits are very low. The patents are primarily powerful against farmers of which they are many, typically small. No one outside of the farm manager probably knows how cows and bulls are selected for breeding, or for inclusion in various herds, or for milking, or what type of milk is in a bulk tank. The chance of A2 Corp. learning enough for a lawsuit are vanishingly small. The chief exception will be if A2 milk is put on the market under a non-a2 brand. A2 Corp. might learn of this and eventually discover who was supplying their milk, conclude their patents were being infringed and bring a law suit against the farmer. Even then, it is unlikely they would collect enough in damages to justify the law suit.

    A farmer who merely starts converting his herds now through choice of semen or choice of which calves to sell for meat has little risk. Reasons for taking such actions might include benefiting public health, being able to sell milk low in A1 beta casein should buyers offer a premium for such milk (which might happen even if the buyers do not plan on offering milk free of A1 beta casein), being ready to sell A2 milk after the expiration of the patents, trying to reduce the cost of compliance should regulations require conversion, or being ready to sell A2 milk to an a2 branded processor should one appear.

    Summary: Why Time is critical for A2

    Given the defenses open to a milk processor, and the weakness of the A2 patents, one could easily imagine a firm deciding to take the risk. The closer the expiration date, the more likely this appears.

    The above analysis is likely to occur to anyone thinking of infringing (or adopting a business strategy that they believe is non infringing, but which sill might produce a reaction from A2), and a competent lawyer can and will point out how long it would take A2 to actually win and secure an injunction, and the probability that the patent would have expired by then.

    Since brand names do not expire automatically, and there are advantages to being the first entrant, A2 should try to get their brand established now, while they still have some patent protection, even if it involves lowering royalties etc.

    Soon the approaching expiration of the patents will greatly lower the value of having a license, tie is rapidly destroying, the creditability of A2’s getting an injunction before the injunction request is made moot by the patent’s expiration. A2 needs a strategy that brings in revenue now (I believe they are deriving no, or almost no revenue from their US patents).

    Possibly they are doing something now, but I fear they are letting an opportunity slip away.

  14. Edward Miller says:

    Bovenhuis is Prior Art against McLachlan Breeding and Selection Patents

    I recently came across the following article which seems relevant prior art against several of the A2 Corporation US patents based on the work of McLachlan, notably those involving breeding or selection of A2A2 animals.

    Genetics. 1994 May;137(1):267-80.
    Mapping and analysis of dairy cattle quantitative trait loci by maximum likelihood methodology using milk protein genes as genetic markers.
    Bovenhuis H, Weller JI.
    Source
    Department of Animal Breeding, Wageningen Agricultural University, The Netherlands.

    Abstract

    Maximum likelihood methodology was used to estimate effects of both a marker gene and a linked quantitative trait locus (QTL) on quantitative traits in a segregating population. Two alleles were assumed for the QTL. In addition to the effects of genotypes at both loci on the mean of the quantitative trait, recombination frequency between the loci, frequency of the QTL alleles and the residual standard deviation were also estimated. Thus six parameters were estimated in addition to the marker genotype means. The statistical model was tested on simulated data, and used to estimate direct and linked effects of the milk protein genes, beta-lactoglobulin, kappa-casein, and beta-casein, on milk, fat, and protein production and fat and protein percent in the Dutch dairy cattle population. beta-Lactoglobulin had significant direct effects on milk yield and fat percent. kappa-Casein had significant direct effects on milk yield, protein percent and fat yield. beta-Casein had significant direct effects on milk yield, fat and protein percent and fat and protein yield. Linked QTL with significant effects on fat percent were found for kappa-casein and beta-casein. Since the beta-casein and kappa-casein genes are closely linked, it is likely that the same QTL was detected for those two markers. Further, a QTL with a significant effect on fat yield was found to be linked to kappa-casein and a QTL with a significant effect on protein yield was linked to beta-lactoglobulin.

    The above described likelihood model was constructed by modeling matings of sires and dams with two markers, some of which were homozygous. In particular homozygous sires and dams are mated. The outcome is homozygous progeny (as predicted by standard genetic theory). While the math is general, the paper provides an empirical application in which several genotypes are examined, including beta-casein. The above discussion shows that this paper discloses the idea of mating A2A2 bulls with A2A2 cows to produce A2A2 progeny.

    This is almost anticipation of A2 US Patent 7563575 which deals with the idea of mating A2A2 bulls and dams to produce A2A2 progeny. This is not quite a direct anticipation because the above paper does not directly propose testing the animals to de4terminetheir genotype. but merely discusses the matings of animals that are A2A2, without ever saying they have been identified as A2A2 by testing.

    However, ways of testing for A2A2 status were well known at the time. Thus, I would argue that the idea of inseminating an A2A2 cow with semen from a bull that has been tested and identified as A2A2 was implicit. The discussion would make no sense unless the animal’s genotype had been identified as A2A2. Testing was the usual method of knowing the genotype at the time. Thus, the use of testing to know the genotype would have been understood by those skilled in the art of animal breeding using genetic data.

    The paper discusses offspring milk production. Thus, it is safe to conclude the process described included milking the cows. Thus the above paper also describes the idea of mating A2A2 bulls and A2A2 cows to produce A2A2 progeny and then milking them. The step of milking is implicit in the discussion of the milk yield, since one skilled in the art would know that milk was obtained by milking cows. This paper also anticipates US patent 7,094,949’s first claim. The example presume that the bulls are known not to have DNA encoding for Beta casein A1.

    The first claim of 7,094,949 reads:

    ” 1. A method of producing milk from one or more lactating bovines producing milk substantially free of .beta.-casein A.sup.1 but comprises at least one or more of .beta.-caseins A.sup.2, A.sup.3, B, C, D and E, the method comprising the steps of: (i) breeding one or more bovine bulls that are known not to have DNA encoding for .beta.-casein A.sup.1 with bovine cows that do not have DNA encoding for .beta.-casein A.sup.1 to give progeny cows which do not have DNA encoding .beta.-casein A.sup.1; and (ii) milking the progeny cows.”

    A textbook test for whether a published procedure should be considered to anticipate an invention is whether if the described procedure would infringe the claim in question. It seems clear that it would.

    However, many of the other claims are not anticipated, since in this paper how the bull’s status is determined is not discussed. However, in other papers published about this time, it is clear that methods were well known for determining the beta casein type from DNA taken from various sources including blood, hair, or skin. The use of genetic tests to determine the genotype would have been obvious.

    With regard to claim 12, which include the step of testing the milk for the presence of beta casein, I would argue that idea would have been known to anyone skilled in the art (remembering that the Elliott/Hill patent is in the art) already. One might also try to invent around this claim by simply not bothering to test the milk, but relying on theory to deduce the type of milk that would be produced. There is a small risk in doing this in that one could imagine a milk purchaser testing the bulk milk purchased for A1 beta casein as a quality control measure, and A2 arguing that did test the milk of the cow indirectly. However, this possible argument by A2 Corp. would seem rather weak.

    One could go on down the list of claims noting most of them would be obvious. For instance, regarding claim 13 which adds to claim 1, using natural or artificial insemination. I would expect that in 1994 both techniques would have been well known to one skilled in the art of milk production.

    There might be a little quibbling about claim 4 and similar claims. Claim 4 reads:

    “4. The method as claimed in claim 1 including the step of testing DNA or RNA from cells obtained from the one or more bovine bulls for the presence of DNA or RNA encoding any of .beta.-caseins A.sup.1, B, C and F.”

    It looks like the method described in the paper being discussed would infringe claim 4, so this claim is anticipated.

    Beta Casein type is not defined in that paper, and it is possible that one skilled in the art of the time would not have defined the A1 allele as including any of .beta.-caseins A.sup.1, B, C and F, although I have not studied the question. However, they would certainly have included the A1 allele as traditionally measured, and if the F had not been explicitly included before, one skilled in the art would have been likely to include it. In any case, A1 is included in the set “.beta.-caseins A.sup.1, B, C and F.” and the method of the paper would infringe this claim.

    On claim 4 and 17 A2 might argue that the above paper discussed a two allelic system for beta casein that described the mating of A2A2 bulls with A2A2 cows to produce A2A2 progeny that were then milked. They might try to argue that their method of producing A2 type milk through breeding animals which could include a specified list of certain mixed alleles with each other, followed by milking was not disclosed in the article above. Thus, anyone mating A22A3 bulls with, say A2A2 cows, followed by milking of the progeny would infringe one of these claims.

    They might have a point. However, the method disclosed in the paper would infringe claim 17 so this anticipates this claim. the two allele system is a subset of the more complicated system of claim 17.

    However, claim 17 does not5 appear to be part of a proper English sentence. The last line has the word are twice making it nonsense. the sentence might be proper if the second are became as. I would submit that a claim whose meaning cannot be deciphered cannot be infringed. In other words, the claim has not been stated clearly enough to be enforceable.

    However, even if this claim survived, a herd owner might “invent around” it by simply never mating only those combinations disclosed in the above paper. This might be easily done by building only an A2A2 herd (in the technical sense, excluding for instance, A3 animals and other that are even rarer), and using only A2A2 semen (in the technical sense). This should avoid infringing claim 17.

    Avoiding claim 4 if it somehow survived invalidation might require obtaining semen from bulls that were known to be A2A2 by a genetic test that did not exclude B, C and F animals, but did exclude A1 bulls. Such a test could be devised if need be.

    If the herd owner did not bother to use the above technique A2 Corp. might (if lucky and with good, high priced legal talent) win an infringement suit. They might be able to identify several cases where such matings had occurred on a typical farm. With large but realistic damages of say $100 per cow per year, and say five such cows identified that had been milked for 4 years each, the damages could rise possibly $2,000. While a moderately large sum, it is hard to imagine A2 incurring the expense of an infringement suit (which they would probably lose) to win such a sum.

    In the above article, the idea of selecting A2A2 animals is a necessary step in breeding A2A2 animals. While the article does not say how this is to be done, it was common knowledge at the time how to test DNA to determine the allele type. Thus I would regard the above paper as describing a process that made obvious the idea of selecting A2A2 animals by genetic tests.

    There are quite few articles about that time that report on the milk properties of A2A2 bet casein animals, information that clearly was being collected with the application of selecting animals in mind for breeding. At least one explicitly reveals the idea of breeding for homozygosity in the kappa casein gene. This is McLean DM, Graham ER, Ponzoni RW, McKenzie HA. “Effects of milk protein genetic variants on milk yield and composition.”Dairy Res. 1984 Nov;51(4):531-46.

    There is also the Elliott/Hill patent application that appears to constitute prior art because it was made available to McLachlan (according to the testimony of Hill in the NZ opposition case). This selects by type of cow and discloses various uses of genetic selection for mating (as shown by the US Patent Office interpreting it so as to support such claims later).

    Thus, the prior art is such as to invalidate US patent 7,863,002 regarding using a genetic test to select A2A2 animals.

    Thus, as a practical matter I believe the above paper, along with other prior art, is sufficient to invalidate the above named US A2 Corp. patents.

    `This should leave US farmers free to start converting their herds by using A2A2 semen in the manner Woodford proposed.

  15. Edward Miller says:

    More Prior Art on A2’s patents

    I found an early (before applications for any patents on A2 type milk) description of the idea of forming herds of cows which would produce a specific form of casein, which appears to be relevant prior art to most of the patents in the A2 field. the basic idea of a herd of cow with a certain casein type had been thought of in 1984 before any of the inventors in this field had their ideas.
    One US patent claims the idea of selection for A2A2 status. One early use of selection is for a certain alpha casein type. In December 1984 the New Zealand Dairy Exporter described an effort to build a herd of cows to produce what they called alpha casein type A, which appeared to have special properties (lower viscosity combined with normal adhesives strength) that made it desirable for use in adhesives. The effort started in 1965 with twins that were heterozygote’s AB. The breeding goal was to have a herd that was homozygous for AA status. This involved selection for a certain type of cow that produced the desired type along with breeding. They were able to produce a bull that was homozygous for the A trait (which the article calls simply type A). It is clear that they intended to breed AA bulls and AA cows.
    Although the article deals with alpha casein, the genetics of the different version of beta casein are the same. An article titled “Inheritance” on p 32 states the key principal that “Homozygous animals produce only the one type of alpha-casein, that being fixed for life.”
    If one replaces alpha casein with beta casein, the principles of are the same. In this article we find taught the idea of creating herds for desired casein type, and also the idea of breeding a homozygous bull with a homozygous cows of the same type to produce progeny of that type (the subject of US patent 7,563,575, the idea of doing the same breeding and then milking to produce milk which contains only the desired type of casein, (which is the subject of US patent 7094949). Of course to do such breeding it is necessary to select animals as being homozygous for the desired type of casein, which selection is the subject of US patent 7863002. All this is taught in the December 1984 article, which is over a decade before the earlier NZ provisional patent application for McLachlan.
    Once these techniques far understood for one variant of casein (alpha casein A), the extension for other variants (beta casein) would be obvious to one skilled in dairy cattle breeding.
    The idea of forming a herd that is homozygous for the desired type of casein is described in this article also. In the article, the type of casein is determined by analyzing the milk, and the type of casein is then used to deduce the animal’s genotype. The technique described is very close to the later patented method for producing milk that contains only A2 beta casein. One patent covers doing this by forming a herd on the basis of milk tests (which is the basis for patents on producing a non-diabetogenic milk based on the work of Elliott and Hill in many countries, including the US, Australia, New Zealand, Canada, and Europe). The above article contains a very explicit statement that the inheritance of casein variants is co-dominant. The discussion in this article is in terms of the genetics, with animals described as heterozygotes and homozygote. If the desired type of milk is one whose beta casein is free of the A1 type, and is hence a milk “suitable for treating and preventing coronary heart disease”, this article anticipates the McLachlan patents that involve genotyping. as well as to the Elliott and Hill ones that involve non-diabetogenic milk.

    Although most dairymen reactions to the various US patents held by A2 involving selection and breeding for beta casein variants is that they are obvious, and should not have been patentable. Yet, it is hard to find full anticipation (exact descriptions of them such that they would have been infringing if the patents had already been issued). Mendelian genetics were well known by the beginning of the 1990’s and there was very extensive research on the different milk polymorphisms. This was not academic research for knowledge’s sake, since such academic research is done with fruit flies or mice. Cows are expensive to maintain and investigation of the properties of their milk was clearly aimed at breeding for more or better milk. However, the goal is taken for granted and often no clearly stated, and the breeding procedures are seldom explicit. the failure to be explicit about the breeding procedures that might be used is not because they were unknown. Instead they were so obvious the writers did not feel it necessary to say how the knowledge would actually be used in breeding. Yet, the steps from what I found in the prior art is so small as to make clear that the final step would have been obvious to anyone skilled in the art.
    In practice A2 is unlikely to be aware of the breeding strategies being used by a US farmer. However, since they have arranged to have test results from the U. of California at Davis sent to them, they might at least know a little about what a farmer was doing. However, by picking other sources for testing, they in New Zealand would not know what a US farmer was doing with his herd. Even if they learned breeding strategies were infringing on their patent, A2 is probably aware of the prior art problems (if not, they could have their attention drawn to them), and even if they somehow became aware that a US farmer was selecting a2A2 semen and or using this with A2A2 cows, they would be unlikely to bring an infringement case and risk having their patents invalidated.
    The difficulty in finding what patent lawyers call anticipation (an exact description of the process such that it would be infringing if done after the patent was issued) is an indirect proof that the idea was indeed obvious to one skilled in the art of dairy breeding. The large literature of the different traits of economic importance associated with the different varieties of milk proteins, including beta caseins, makes sense only if the writers presumed that the readers would find it obvious how to use the information revealed, including how to breed cows to be homozygous for the genes that were shown to be economically important.
    If it was not obvious, the writer’s would explicitly state that the traits should be bred for and describe how to do the breeding. They would say, “Start with cows that were homozygous for the desired trait, test bulls to find those that were homozygous for the desired trait, inseminate the cows with semen from said bulls.” Then the writers would then explicitly state that the cows so bred should be milked. However, all of this is not said, because it would be obvious to a dairyman reading the articles.
    Another article making it clear that breeding for milk protein status is a known technique is, “Is there Profit in a Protein gene” by John P. Gibson in the Holstein Journal, December 1990, p29. He talks about the kappa casein gene, but to one skilled in the art of dairy cow breeding, the extension to the beta casein genes would be obvious. He states it is now possible to determine the genotype of a bull, and refers the advantages of BB bulls over AA bulls. By comparing the two homozygous types, AA or BB he is showing he is aware that the homozygous animals will produce milk with only one type of kappa casein. By discussing the economic advantages of breeding for such status he shows he is aware of the possibility of breeding for these traits. His not going into the details shows that he presumed that his readers, ones skilled in dairy breeding would find it obvious how to breed for cows that produced only the desired type of casein (by inseminating homozygous cows with the desired type with semen from homozygous bulls with the desired type to produce progeny of the desired type, and then milking the cows).
    It might be thought that those skilled in dairy cow breeding might not know enough to realize that breeding for homozygous cows for beta casein was possible, or how to do so. However, Jairam and Nair in “Genetic polymorphism of milk proteins and economic characters in diary animals (Indian Journal of Animal Science 53(1), pp1-8 in January 1983 examined several economic characteristics and how they vary with the genotypes as identified in various ways. On p 2 it states that there are some ideal combinations which have an effect at age at first calving. These combinations include AA beta casein variants. He then uses the phrase “if selected,” stating that use of such combinations would improve the average age of the herd by at least one month. Here the article teaches the possibility of selecting for homozygous animals with regard to beta casein variants. The extension of this 1983 suggestion to McLachlan’s idea of selecting for animals homozygous for A2A2 status in the beta casein is obvious, given this 1983 teaching of the possibility of such selection for homozygous traits in the beta casein.
    Another paper that points at breeding is Lin, Sabour, and Lee (January, 1992) “Direct Typing of Milk Proteins as an Aid for Genetic Improvement of Diary Bulls and Cows: A Review”, vol. 60, NO. 1, in Animal Breeding Abstracts, pp. 1-9. Even the abstract points to “milk protein typing as a valuable tool for early selection of bull and cows.” While the phrase used is “milk protein typing,” both the sentences before and after refer to genotyping, teaching that genetic methods could be used. A table on p. 2 showing the major proteins of bovine milk includes beta casein A1, A2, A3, B, C, D, E. This makes it clear that the teaching can be applied to beta casein genetic variants. The article then discusses various economic traits with frequent references to selection. One sentence on p. 3 refers explicitly to increasing the percentage of the beta casein A2 allele as a way of improving first lactation performance. Thus the general teaching on selection clearly includes use of the beta casein alleles. He presents results for PCR techniques on kappa casein, but says in the next sentence that similar PCR techniques have been developed for beta casein, thus extending the teaching to beta casein variants. A closing sentence refers to “rapid fixation of desired genotypes on superior genetic background”. In general selection for a particular allele will include selection of homozygote, and if fixation is desired, this implies mating of homozygote, and elimination of other alleles. This makes clear that that teaching includes mating A2A2 bulls and cows to produce A2A2 progeny. the frequent references to milk properties in this article makes it clear that milking of such cows is also taught.
    It is clear that the application of the methods described in this article could lead to selection for A2 beta casein and against A1 beta casein, and would result in selection of A2A2 animals, and to insemination by A2A2 bulls of A2A2 cows to produce A2A2 progeny, and also to the milking of these progeny. Thus, the application of the methods taught in this paper would infringe on the McLachlan patents involving breeding. thus, this paper either anticipates or makes obvious the breeding techniques in the McLachlan patents.
    A similar situation exists for the McLean, Graham, Ponzoni (1984) paper titled, “Effects of milk yield protein genetic variants on milk yield and composition” (Journal of Dairy Research (51, 531-546). The basic teaching is on p532 which states, “An association of milk protein genotype with composition and properties of milk could be exploited commercially by using these genotypes as an additional criteria in selecting bulls used for artificial insemination.” That this teaching extends to beta casein genetic variations is shown on p543 where effects of beta casein “genotype on the concentration and proportion of most of the casein components” are discussed. There is specific mention of the A2, A1, and B alleles, indicating the teaching could be extended to those genotypes. In particular, on p544 there is a teaching that for cheese making the B variant of beta casein is preferable, followed by a statement that its low frequency “allows potential for change”. The clear implication is that one could breed for this allele. A sentence reads “genotypes with favorable attributes should be considered as important criteria in the final selection of bulls for widespread use in artificial breeding.” Selection for a particular variant of beta casein would include selecting the homozygous bulls with that variant. This is because a bull that carries two copies of the desired gene (i.e. is homozygous for the desired allele) is more likely to pass this on to its offspring than a bull that carried only one copy of the desired gene. Thus, selecting for such desired variants would involve giving preference to bulls that were homozygous for the desired trait (such as A2 bet casein) or bulls that carried only on copy of the desired gene. Thus, selection for a trait implies also selection of bulls homozygous for that trait. If the trait in question was A2 beta casein, such selection would have infringed the recently issued US patent 7863002, if it had been in force at the time. The same argument applies to cows. Thus, In the course of selective breeding for a desired variant, the homozygous bulls would be used to inseminate homozygous cows of the same type to produce progeny that was homozygous for that allele. Thus, such breeding would infringe the US patent 7563575.
    On p544, there is a statement that “The greatest role of milk protein genotypes appears to be in improving the yield and quality of products, such as cheese, . . . ” Bottled milk, like cheese, is a milk product. Thus, the teaching of this article includes the milking of the cows that were bred for these milk protein alleles. Thus, the process taught in this article implicitly includes the breeding for a particular beta casein variant followed by milking. Milk from cows homozygous for the A2 allele is a product, as is milk free of the A1 form of beta casein. However, doing so would infringe US patent 7094949, if it had been in effect at the time. Hence, it appears the teaching of this patent would anticipate or make obvious the US patents 7094949, 7563575, 7863002. While this article does not propose breeding for the A2 allele of beta casein, but only for the B allele, it is clear from the discussion it does not make this proposal merely because the evidence showed no benefit in doing so. Should one skilled in the arts of dairy cattle breeding or dairy farm operation believe that there was some benefit in having animals homozygous for A2 beta casein, these same methods could have been used.
    A report in the Journal of Dairy by A.S. Marziali and K.F. Ng-Kwai-Hang titled, “Science by Relationships Between Milk Protein Polymorphisms and Cheese Yielding Capacity” (Volume 69, Issue 5, Pages 1193-1201, May 1986) reports that cheese yields are higher for A1A1 beta casein milk than for A1A2 beta casein milk. This article has an explicit teaching that breeding could be used to alter milk composition to obtain better yields of cheese. It says, “For the casein fraction, selection should be for beta-casein A1A1 and kappa casein BB”. Here is an explicit teaching of the possibility of breeding for a homozygous beta casein variant. Since the purpose would be cheese making, milking is implicit in the proposal. A reference in the same paragraph to “autosomal genes, which are inherited in accordance with Mendelian inheritance,” makes clear how this is to be done. Also there is an explicit reference to “selection should be for beta-casein A1A1,” which should mean that the idea of selection for beta casein A2A2 is an obvious idea (i.e. this prior art means the invention behind US patent 7863002 was obvious in view of the prior art).

    A slightly later paper (July 1986) “Effects of Milk Composition and Genetic Polymorphism on Coagulation Properties of Milk” in the Journal of Dairy Science (Vol. 69, Issue 7, Pages 1793-1798) by the same authors, suggests selecting for the phenotype A1A1 for beta casein and for the phenotype BB for kappa casein to improve coagulation properties of milk. This could be an anticipation for the idea of Elliott/Hill in selecting for phenotypes of beta casein. Since it is also stated that the phenotypes are controlled by autosomal genes, followed by a proposal that “it might be useful to selection for the phenotypes of those three proteins that give the best results in terms of coagulation properties.” this also makes obvious the McLachlan idea of selecting cows that are homozygous for a bet casein variant. One skilled in the art would have no problem substituting A2A2 for A1A1 cows.
    A third paper(October 1986) by the same authors in the Journal of Dairy Science (Vol. 69, Issue 10, Pages 2533-2542) “Effects of Milk Composition and Genetic Polymorphism on Cheese Composition” taught as beta casein, . . . “are inherited in accordance with Mendelian inheritance, breeding practices could be used to increase the frequencies of these phenotypes for these three proteins, . . .” wit beta casein A1A1 being one of the types that could be bred for. Again, the statement about “inherited in accordance with Mendelian inheritance” makes it clear how such breeding was to be done.
    An article by Henk Bovenhuis, Johan A.M. Van Arendonk, Siem Korver in the September 1992 Journal of Dairy Science (Vol. 75, Issue 9, Pages 2549-2559) titled “Associations Between Milk Protein Polymorphisms and Milk Production Traits” teaches that: “Selection would then be for animals carrying the favorable k-casein B allele in combination with the beta-casein A1, A2, or A3 alleles.” Here is just one more example of teachings that refer to selection for beta casein variants.
    Of course, in reality casein varieties are just one characteristic inherited by standard Mendelian genetics, whose characteristics were well understood before the nineties, and how to breed for Mendelian traits was well understood well before 1990 even without these specific teachings in the literature. It is possible the examiner was not familiar with basic genetics and failed to realize this.

  16. Edward Miller says:

    More Prior Art on Breeding Farm Animals

    Unlike in most countries (where patents only cover herd building by testing animals followed by selection), in the US A2 Corporation has patents that cover breeding A2A2 animals by mating A2A2 bulls with A2A2 cows, and a method of producing A2 milk by breeding such A2A2 cows and then milking them, and even on using genetic tests to select A2A2 animals. The effect of these is to make Woodford’s (very cost effective) idea of using A2A2 semen to gradually reduce the amount of A1 beta casein in the milk infringing of one or more of these patents. This appears to have deterred bred associations, semen sellers, and farmer’s from taking actions that would begin to reduce the number of A1 beta casein carrying cows in the dairy herds.

    This appears to have imposed a very high cost on the US health for very little benefit to A2 Corporation and probably some harm through bad public relations and making it harder for them or their licensee to acquire A2A2 cows. Fortunately, I have found prior art which makes it clear that these “inventions” were sufficiently obvious at the time that they should not have been patented, and that A2 would probably end up losing if they tried to enforce these patents.

    This makes it unlikely that A2 Corporation would actually try to enforce these patents in the US by bringing infringement suits. The most likely outcome (besides adverse publicity) would be that they patents are declared unenforceable. Given that the damages they might collect from a typical infringer would be small (probably only a reasonable royalty) and the high cost of patent litigation, the risk of being sued has always been small for the typical farmer or breeder, even if A2 Corp. somehow became aware of their infringing activities. Since A2A2 cows look like other cows and details of semen selection may be known only to a single person, infringement arising from a farmer starting to convert herds now through using A2A2 semen would probably not come to A2 Corp. attention.

    If it did, it would probably be in A2 Corp. to ignore it, unless it was very flagrant. The reason is that the cost/benefit ratio for most litigation to enforce these patents would be low even if they were certain to win, and the risk of having the patents declared invalid does litigation even riskier.

    Since A2 Corp. probably derives some benefit from a public perception of their patents as being strong and enforceable, they can be expected to avoid litigation. The most likely cases where they might be litigation would be if A2 Corp. was bring a general action against someone trying to produce an A2 type milk that would threaten their own plans. Most of the A2A2 cows being used would have not been the result of a deliberate breeding program, but selected from existing herds. The heart of their case would be infringement of their patents related to selection and then milking, including those based on the work of Elliott and Hill. However, their lawyers would almost certainly include infringement of the breeding related patents, since that might somewhat increase their claims for damages (especially if there were heifers and pregnant cows which were the result of an infringing breeding program but which were not yet producing milk) and would complicate the defense somewhat. Thus, a high degree of protection from A2 lawsuits can probably be obtained simply by not producing an A2 type milk that is marketed as such. The farmer who is merely preparing himself to produce A2 type milk after patents have expired or if an A2 licensee offers to buy such milk is probably safe.

    One possible exception would be someone whose infringement was so well publicized that A2 Corp. felt they had to either take legal action or have it perceived that they would completely unwilling to enforce their patents. Even if A2 knew for certain that the outcome of litigation would be having these patents declared unenforceable and the incurring of considerable legal expenses (and a high pubic relations cost as they come to be seen as acting against those trying to bring a safe milk supply to a US children), they might still bring an action either through “stupidity” (which can never be rule out when human are involved), or as part of a “bluff”.

    Patent litigation can be time consuming, and a perception that A2 was unwilling to enforce certain patents could be neutralized by bringing an action. Especially if they anticipate losing and having the patents declared unenforceable, they might take advantage of the various opportunities the law provides for delaying trials. such delay would reduce their legal costs in the short run. Since such clearly would be in the interest of the accused infringers also, one could imagine a long delay before the case came to trial. The final outcome would probably be a negotiated settlement where the terms were kept secret and the infringer took a license on some (probably favorable) terms that were not made public. This would make it possible for A2 to maintain a public position that its patents were enforceable and it was willing and able to do so.

    From the A2 position being forced into such litigation would be expensive. Any damages obtained (or negotiated royalties) would be small and probably not come close to covering the costs both in money and in public relations. A2 Corp.’s real economic interest is in maintaining the perception that their herd selection patents (testing to form A2A2 herds and then milking) are valid and will be enforced. A2 runs the risk that a failure to act against infringement of breeding patents (including the selection patent that might be violated in the course of producing A2A2 semen) would cause them to be perceived as unwilling to enforce their other patents. This could lead them into expensive litigation and a public relations disaster.

    As I have argued elsewhere, this makes these patents “toxic,” and the best strategy for A2 Cop. is to either give them up, or license them on very liberal terms so there is virtually no risk of their failure to enforce these patents being perceived as signs of weakness. The situation is very similar to that of a country that finds itself in a dispute over ownership of a small island that is of little value in itself, but where failure to defend its claim against another country will be perceived as weakness. In some cases, ridding itself of such claims i9n conditions where it is not perceived as weakness may be prudent.

    Thus A2 risks being in a position in the US where many are acting of Woodford’s idea that A2 semen should be used, and some are doing it in such an obvious way that A2 Corp. cannot pretend that it is not aware of the potentially infringing activity. If they take no action, they appear unwilling to defend their patents, including the ones are actually of value to them. It is possible the potential infringers are even trying to force a legal tests to have the patents declare unenforceable, or are seeking to use such litigation as a way to publicize the advantages of conversion and the problems of A1 beta casein. Such infringers may have even maneuvered to make the test case one where the defendant is sympathy inspiring, and it is clear that A2’s vital interests are not at risk. If A2 takes legal action they incur high legal expenses, will probably have the patents declared unenforceable, and are depicted as willing to sacrifice the health of children to prevent the use of A2 semen when they derive little or no benefit from preventing such use. If smart, they would try to avoid this situation.

    A2 Corp seems to be in this position with its breeding claims, and a smart move would be either to dedicate them to the public (possibly in such a way as to get a tax benefit or a publicity benefit), or issue liberal licenses, so the issue does not arise and A2 possibly get even a little revenue. I have suggested elsewhere they might be able to donate the rights to a charitable organization, take back a license for their own use, and then put a link on their bottles to the charities web site where the A1 beta casein problem is explained.

    From the viewpoint of encouraging farmer’s to start conversion however, the A2 breeding patents do remain a problem. Many farmers (and breed associations, semen sellers etc.) are very litigation adverse and do not want to risk litigation. some (especially farmers) will view this as a moral issue and are no more willing to “steal” intellectual property than they are to steal anything else. If they perceive these patents as having been obtained by bad conduct (concealing prior art), claiming inventions that they did not make, etc. some may decide that the patents do not represent real honestly obtained intellectual property, and may be more willing to infringe them (especially if the effect of infringement is to protect children from harm).

    Also, as the discussion above makes clear, one way of avoiding litigation while infringing is to either keep the infringing activities secret (easy to do with breeding strategies), or to at least not publicize the infringing activities. Normally, one would expect the lead in any new technology to be taken by “early adapters” followed by other farmers copying them. Unfortunately, due to the A2 breeding patents, it is prudent for farmer’s who are converting their herds by using only A2A2 semen (and possibly preferentially culling heifers on the basis of A1A2 test results) not to say what they are doing. Thus, the various methods by which innovations are spread in farming (articles about successful farmers that mention their methods, farmer’s discussing their techniques at meeting, etc.) will be less effective. The provision in US law that includes “actively encouraging infringement” as infringement will discourage many from publicizing the case for using A2A2 semen. Semen sellers can have their bulls tested and mention the results in their catalogs, but they would be wise to be careful about urging that the semen be used in an infringing way. They might avoid suggesting that A2A2 semen be used to impregnate A2A2 cows in order to produce A2A2 progeny, although they could point out that when used with A1A2 cows, half of the progeny would be A2A2. Thus sellers of A2A2 semen who might normally be expected to be actively promoting this product, are more likely to just make it available, possibly with a brief note on what it is, and the basic genetics and possible health effects. breed associations are less likely to actively encourage efforts to start conversion now.

    Now let us look at what I found in the literature that is prior art that should make the idea of breeding for A2A2 status “obvious” and an idea that should not have been patentable.

    Legates and Warwick’s “Breeding and Improvement of Farm Animals” (1990 Eighth Edition) teaches on p. 91 “an individual cannot have a specific blood antigen or blood or milk protein variant unless one or both parents had it.” Thus, if it is desired to breed cows (and bulls) that lack genomes coding for certain forms of beta casein, one need merely use semen that lacks said code or codes to inseminate a cow that lacks that genetic code or codes. This sentence also implies that if it is desired to produce milk that lacks a specific milk protein variant, that one need merely breed cows both of whose parents lacked that variant, and then milk the cows. It appears the inventions of US patent 7,094,949 (and US patent 7563575 and US patent 7863002) was disclosed in this textbook before McLachlan claimed to have invented them.

    Legates and Warwick’s “Breeding and Improvement of Farm Animals” (1990 Eighth Edition) teaches (p69) “The genes controlling the genetic variants “alpha casein and beta-casein “are closely linked.” This suggests the possibility of identifying the beta casein type from a market in the alpha casein, which is the subject of an A2 Corp. patent on testing. Admittedly, this sentence does not say how accurately the beta casein type can be deduced from a marker in the alpha casein type, but to my knowledge the possibility of doing so with a high degree of accuracy has not yet demonstrated. The A2 Corp. patent application demonstrated this could be done among sisters with a common bull, but it does not demonstrate the possibility of doing so among cattle that are less closely related, or are even of different breeds.

    On the same page (p. 89) is a reference to milk protein variants being “valuable genetic marker” and to their use as “aids to selection.”

    On p28 is the teaching that “each parent was genetically pure or homozygous, and produced only one type of gametes for this particular character.” On p29 is the teaching that the gametes of a homozygous animal will be of one type (illustrated with red and white shorthorn cattle) and on p 27 there is the same showing for the tallness factor in peas. It is a simple deduction that if all the games in a mating are of one type, the offspring must of that type. If the bull is A2A2, the gametes must be A2. If the cows is A2A2, the gamete must be A2. Hence a mating of such a bull and cow will give progeny with all A2.

    If also follows that if one type A2 is missing from both parents, the progeny cannot have it. This gives the patented breeding procedure of A2 Corp. If A1 is not in the bull or the cow, the progeny cannot have it.

    On p213 there is the teaching “. . . selfing of Bb individuals (BB X BB) will produce only BB offspring.” While the above sentence is from a discussion of self fertilization in plants, there is an explicit statement that BB individuals crossed with BB individuals will produce only BB offspring. In the next paragraph there is the statement that “this same process occurs with inbreeding in animals.” This extends the teaching to animals, and since the book is “Breeding and Improvement of Farm Animals” with cattle (including dairy cattle) being the most common animal discussed, there is little doubt about the application of this principle to dairy cattle. This prior art makes the idea of breeding A2a2 animals by mating A2A2 bulls and A2A2 cows obvious. If, in the statement that “(BB X BB) will produce only BB offspring,” replacing B with A2 gives the teaching that “(A2A2 X A2A2) will produce only A2A2 offspring.” Thus, this claim in the breeding patents appears obvious, and a patent should not have been issued.

    On p22-24 there is a statement of basic modern molecular genetics, such as could be found in other books prior to the date of the patents. On p22 it is explained how the genetic code directs the formation of specific amino acids. It is described how this code is transcribed into messenger RNA. then “by translation their individual messages lead to the formation of specific protein molecules.”

    On p. 24 is taught that “a codon was a combination of three nucleotides which specified the addition of a particular amino acid in the molecule.” and shortly afterward, “Cistron is the term used to represent the unit of DNA carrying the information necessary for the formation on one polypeptide chain in protein formation”. It follows immediately that if there is no code for the sequence of amino acids needed to form a particular protein, such a type of beta casein including the type that is A1, that that protein cannot be formed and will not be found in the milk. Thus, if it is desired to produce milk that lacks certain forms of beta casein, one need merely use semen that lacks that code to inseminate a cow that lacks that code.

    Likewise, if it is desired to have certain type of beta casein in the milk it is necessary to use cows and bulls that contain the genetic code for producing that type of casein. These two principals combined make it obvious how to breed for cattle that contain the code for certain type of beta casein but lack the code for others. The procedure is to select parents (bull and cow) that lack the code for the types that are not wanted, but which do contain the codes for the types that are wanted.

    It might be useful in a case to supplement this textbook with others (published before 1994) that make clear that proteins are formed from strings of amino acids with he order determined by the DNA code. Much of this material is sometimes referred to a the “Central Dogma of Molecular Biology.” According to a Wikipedia article, “The central dogma of molecular biology was first articulated by Francis Crick in 1958[1] and re-stated in a Nature paper published in 1970:[2]”

    These citations or a pre-1994 textbook based on them might be used to fill in the details. A couple of pre-1994 papers should be found that explicitly state that casein, including beta casein in its varieties are proteins should be included to make clear that the teachings do apply to beta caseins. However, Legates and Warwick’s “Breeding and Improvement of Farm Animals” (1990 Eighth Edition) on p88 talks about “Milk Proteins” teaches that casein is a protein “About 80% of the protein in milk is in the form of casein”, and states that beta casein is one of them.

    The next paragraph states that “Each of the major type of protein has two or more genetic variants. Each variant is related to a single autosomal gene.” It follows immediately that if there is no code for the sequence of amino acids needed to form a particular protein, such a type of beta casein including the type that is A1, that that protein cannot be formed and will not be found in the milk. Thus, if it is desired to produce milk that lacks certain forms of beta casein, one need merely use semen that lacks that code to inseminate a cow that lacks that code. The reference to milk proteins makes it obvious that the proteins are in ilk, and one can add the stage of milking the cows that have been bred in the above manner (US patent 7563575) to cover the claims of US patent 7,094,949. the latter is a method of producing A2 type ilk by breeding A2 cows and then milking them. At various points Legates and Warwick do teach that milk can be obtained from dairy cows, making the extension to milking rather obvious (at least to one skilled in the art of operating a dairy farm).

    On p. 89 there is taught about beta casein that there are “four variants also with four allelic autosomal genes with no dominance.” On the same page there is a reference to using milk proteins as an aid to selection. A little thought would show that if they were to be used in selection, one would include animals whose genomes coded for the desired versions, and exclude those that coded for undesired variants.

    From Wikipedia: “In 1949 Fred Sanger correctly determined the amino acid sequence of insulin, thus conclusively demonstrating that proteins consisted of linear polymers of amino acids rather than branched chains, colloids, or cyclols.[74] ” Thus, there should be little trouble in demonstrating that before these inventions in question, that beta casein was known to be a protein, and as such coded for genetically, from whence it can be deduced that in the absence of a genomic code for a specific version, that version cannot be produced in the milk of a cow. Hopefully, this should show that the McLachlan inventions were too obvious to have been patented.

    They probably got past the patent office examine because she was unskilled in genetics, and probably only searched earlier patents, and no one earlier may have tried to get patents on such basic breeding techniques, or at least not for dairy cows or as applied to beta caseins.

    Update on Basic Genetics as Prior Art
    It is sometimes hard to find documentary evidence of common knowledge so it can be used as prior art. What is obvious given the state of knowledge is often not stated explicitly because the authors presume the readers will fill in the gaps without the details being spelled out.
    However, in Genetics and Molecular Biology (2nd edition, October 1, 1993) by Dr. Robert Schleif, I found on p 232 in Figure 8.4 there is a Punnett Square with a description of inheritance in diploid organisms explaining how meiosis occurs, leaving each gamete with one copy of the chromosome. It states “”For example, both copies of the chromosome in question could contain the A allele. For convenience, denote this as (A/A). Such a cell is called homozygous for gene A.” Even here, they do not explicitly say that mating two homozygous animals must produce progeny which is homozygous for the same trait. Instead, in the next paragraph (on p. 233) he says: The interesting results come when two heterozygous individuals mate. . .”
    Understanding Genetics, A Molecular Approach by Normal V. Rothwell (March 1993) on p5 teaches: “However, in its strict sense, codominance implies that a definite product or substance controlled by each allele can be identified.” Combined with the usual material on meiosis in the book, it can be predicted that homozygous animal mated will beget homozygous animals.

  17. Edward Miller says:

    More prior art on Cattle Breeding from Dalton’s An Introduction to Practical Animal Breeding 1980 and the Journal of Dairy Science

    Another book that teaches breeding strategies that are used in the A2 Corp. breeding and selection patents is Clive Dalton’s “An Introduction to Practical Animal Breeding” (Granada Publishing, copyrighted 1980 and 1981, which dates are well before the dates of the patents.). While this is a general textbook on animal breeding, there are many examples throughout of cattle breeding, and in particular dairy cattle breeding, teaching that the general principles in the book are applicable to cattle. In particular, a section titled “Dairy Cattle Breeding” starts on p110 and ends on page 119, making it clear that the principles taught can be applied to dairy cattle breeding..

    As in other textbooks there is a description of meiosis and how each gamete contains only the genetic code for one allele (p. 22). From this a dairyman or breeder of ordinary ability could deduce that if you do not wish an animal to carry the genetic coding for A1 beta casein (or any of another list of beta casein types), the breeder merely must use semen from a bull that does not carry the genetic coding for A1 beta casein to inseminate a cow that does not carry the genetic coding for A1 beta casein. The same logic can be used if there is a list of beta casein types that it is desired to exclude from the progeny.

    On p 28 there is a simple discussion of Mendelian genetics in which a Dam providing only X gametes is mated with a Sire that can provide both XD and Y gametes. the table shows that when X gametes are used, the progeny is always XX. From the diagram on p22 the breeder can easily deduce that an XX Sire will produce only X gametes. Then from the diagram on p25 it can be deduced that crossing an XX sire with an XX Dam will produce only XX progeny. Since X is a general notation for an item of genetic coding (or an allele), the X can be replaced by A2, the genetic coding for A2 beta casein. One then gets the teaching that a way to get A2A2 animals is to breed A2A2 Sires with A2A2 Dams.

    Without loss of generality, X can be made to stand for any member of a list of desirable genetic doings. The conclusion on how to breed for these type is to mate a bull with a dam, each of which contains only the genetic coding of the desired types.

    That breeding two parents each of which are homozygous for a particular allele yields progeny that are homozygous for that allele is also taught on p38 in relation to cattle. Here it is taught in breeding Shorthorn cattle with different color coats that breeding:
    RR X RR =all red (RR)
    rr X rr = all white (rr)
    The above is merely an example, and its understanding should make it obvious that A2A2 progeny can be bred by crossing two A2A2 animals.

    That the above theory may be applied to cattle is shown by the list of characteristics on p27 controlled by single genes in cattle, and by the discussion on p27-p28 of the application of Mendelian theory to the polled trait in cattle. On p30 there is an explicit statement that crosses between homozygote (PP X PP) and (pp X pp),the offspring are respectively all PP and all pp. If P or p is replaced with A2, one again gets the conclusion that A2 progeny can be obtained by crossing A2A2 bulls and A2A2 cows, which is the technique of the patent. It should be obvious to one who has read the book how to breed to get A2A2 animals.

    Since mating of A2A2 animals requires selecting such animals, the teaching of this book makes obvious the idea of selection for A2A2 status.

    Thompson et al (1964) reports the results of 168 matings of AA type beta casein animals mating with AA type beta casein animals and that all progeny were AA. While this is not quite the same as matings of A2A2 animals, this paper in teaching that mating of homozygous animals of the AA type gave progeny of the AA type makes the extension to the idea of mating A2A2 bulls to A2A2 cows to give A2A2 progeny obvious.
    Thompson, M. P., C. A. Kiddy, J. O. Johnston, and R. M. Weinberg. 1964.
    Genetic po1ymorphism in Ga~eins of cow’s milk. II. Confirmation

    of the genetic control of 6-casein variation. J. Dairy Sei.
    47: 378.

    Also in the 1959 Journal of Dairy Science, on p822 there is the following abstract. This provides another case of early mating of cattle homozygous for a milk protein. It is clear that they expected the progeny of such matings to be homozygous for the type of milk protein. Given the application of this breeding technique to cattle homozygous for two different milk proteins, it would have been obvious to a breeder that this technique could have been used to produce cattle progeny homozygous for AQ2 beta casein.

    t’40. Inheritance of the f~-lactoglobulins in
    cow’s milk. R. D. PLOW5[AN, R. E. TOWNSEND,
    C. A. KID1), AND S. N. TI~AS~EFF, Dairy
    Cattle Research Branch and Eastern Utilization
    Research and Development Division,
    USDA.
    Two forms of B-lactoglobulin (A and B)
    have been found in the milk of individual cows.
    Previous workers have postulated that the formation
    of these proteins is geuetically

    controlled.
    Paper electrophoresis was used to determine
    which fi-lactoglobulins were present
    in the milk of 131 cows from the Holstein herd
    at Beltsville. The milk of 33 cows contained
    the A form only, 28 contained the B form only,
    and 70 contained both A and B. A study of 42
    offspring, resulting from matings of parents
    for which the B-lactoglobulin types had been
    established, indicated that differences in this
    characteristic are determined by a single pair
    of alleles with no donfinance. The gene frequency
    was 0.52 for the A gene and 0.48 for
    the B gene. The observed frequencies of the
    three genotypes agree with expected, assuming
    random mating with respect to this character
    (P = .73). The genotypes of eight bulls were
    inferred from daughter-dam infornmtion. Six
    of these bulls appear to be of Genotype AB
    and two appear to be AA. Limited data on
    five other bulls indicate that two of them could
    be AB or BB and that the other three could
    be AB or AA.

  18. Edward Miller says:

    Anne Marie Bech and K. Rotvig Kristiansen in the Journal of Dairy Research 19990 vol. 57 53-62 in the article titled “Milk protein polymorphism in Danish Dairy cattle and the influence of genetic variant in milk yield” provide additional prior art.
    In the last paragraph they talk about using knowledge of the genetic variants as a selection criterion in future cattle breeding programs. Since cattle whose beta casein was A2A2 animals were among those whose milk yields were studied, this paper seems to be proposing the idea of using A2A2 status for selection which is the idea of a US patent. This paper thus appears to contemplate the patent technique and is one more that could be used to invalidate the selection and breeding patents in litigation.

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