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Why is Myriad’s stock up? The company said it wasn’t worried about a Supreme Court decision going against its basic patents on BRCA genes.

UPDATE: “Myriad shares initially rose sharply on the ruling but ended the day down 5.6% at $32.01 as investors reconsidered the odds that the cDNA ruling would help the company,” as reported after the market close Thursday by The Wall Street Journal.

Here’s the section of the recent quarterly filing:

Item 1. Legal Proceedings

We are a defendant in a lawsuit brought by the Association for Molecular Pathology, et al., the Plaintiffs, originally filed on May 12, 2009 in the United States District Court for the Southern District of New York (the “District Court”) seeking a declaratory ruling that 15 claims in patents relating to the BRCA1 and BRCA2 genes are invalid and unenforceable under 35 U.S.C Section 101. The 15 claims at issue in the lawsuit are part of the intellectual property relating to our BRACAnalysis predictive medicine test for breast and ovarian cancer. The District Court ruled that the claims were invalid; however, on appeal, the United States Court of Appeals for the Federal Circuit (the “Federal Circuit”) ruled that the nine composition of matter claims relating to isolated DNA molecules and one method claim relating to screening potential cancer therapeutics via changes in cell growth rates are patent eligible. The Plaintiffs appealed the decision of the Federal Circuit to the United States Supreme Court (the “Supreme Court”) as it related to the composition of matter claims. The Supreme Court vacated the Federal Circuit’s decision and remanded the case for a redetermination as to the composition of matter claims. Following remand from the Supreme Court, on August 16, 2012, the Federal Circuit again ruled that the nine composition of matter claims relating to isolated DNA molecules and one method claim relating to screening potential cancer therapeutics are patent eligible under 35 U.S.C. Section 101. The Plaintiffs again sought review by the Supreme Court of the Federal Circuit’s decision on remand. On November 30, 2012, the Supreme Court granted certiorari, agreeing to hear the case. The Supreme Court heard oral arguments on April 15, 2013 and a decision by the Supreme Court is expected by June 30, 2013.

Apart from the nine claims being challenged in this lawsuit, there are over 500 separate claims under 24 patents, and various propriety technologies and information, which cover the intellectual property utilized in, or relating to, our BRCAnalysis predictive medicine test for breast and ovarian cancer which are not subject to this lawsuit. Accordingly, we do not believe that this lawsuit will have a material adverse impact on our business, financial position or results of operations.

We are not a party to any other legal proceedings that we believe will have a material impact on our business, financial position or results of operations.