July 2014

Supreme Court Patent Cases Per Decade

Patent, , ,

The Chart below is an update of one I published earlier this year. The new chart adds in a couple of extra cases that I had previously not included and also takes account of the Supreme Court’s spate of decisions this term, including Alice v. CLS Bank (subject matter eligibility); Nautilus v. Biosig (indefiniteness); Limelight v. Akamai (divided infringement for inducement); Highmark v. Allcare (attorney fee awards in exceptional cases); Octane Fitness v. Icon Health & Fitness (attorney fee awards in exceptional cases); and Medtronic v. Boston Scientific (burden of proving infringement always falls on patentee even in licensee DJ actions). Readers should also note that the decade of 2010’s is not yet ½ completed and the Court has already granted writ of certiorari in one pending action: Teva v. Sandoz (standard of appellate review for factual findings that serve as the underpinnings for claim construction). We can expect that the trend will continue over the next several years with special focus on the new rules and procedures stemming from the America Invents Act of 2011. Note – my list largely agrees with Prof Ouellette’s

Patent Prosecution Bars: My New Article

Ethics

My new article (well, I finished it months ago) is now available online at St. Mary’s Journal on Legal Malpractice & Ethics.  It’s called Is Litigation Counsel Who Also Engages in Competitive Decision-Making Wrong for the Part?, and is available here.

The abstract:

In-house counsel wear different hats, and are often involved in business decisions regarding products, marketing, and other strategic issues. It was in this context that courts began to adopt protective orders that precluded in-house counsel who provided their clients advice with “competitive decision-making” from having access to information from a competitor disclosed in discovery. Prosecution bars present numerous issues for courts and counsel. It may be that because of prosecution counsel’s knowledge of the technology that her service as trial counsel would lead to cost savings and other benefits to her client. However, due to the myriad problems that arise from having litigation counsel also engage in other activities, she may be wrong for the part. Only through careful analysis of the policies involved, and careful drafting of any protective orders can courts, clients, and counsel be sure of their casting decisions.

Interpreting Claims Against The Drafter

Patent

By Dennis Crouch

Over the past year, the Federal Circuit has decided dozens of important patent cases. Of those, one of the most important appears to be 3M Innovative Props. Co. v. Tredegar Corp., 725 F.3d 1315 (Fed. Cir. 2013). When I wrote about the decision in August 2013, I titled my post “Judge Plager: Construe Ambiguous Terms Against the Drafter.” In the decision, Judge Plager’s concurring opinion was the most pointed and poignant. However, each of the judges wrote their own opinions, with Judge Reyna writing for the majority and Judge O’Malley both concurring-in-part and dissenting-in-part.

Judge Plager’s concurring opinion focuses on the intentional ambiguity inserted into the claims by 3M. Judge Plager argues that courts should begin to apply the contract doctrine of contra proferentem and construe ambiguous terms against the drafter (i.e., against the patent holder). Judge Plager writes:

Sometimes such ambiguity [in claim drafting] is the result of sloppy drafting, and sometimes it appears that claims are drafted with a degree of indefiniteness so as to leave room to later argue for a broad interpretation designed to capture later-developed competition. . . .

Cases like this—claim construction issues such as this one—may well deserve application of a principle analogous to the contract doctrine of contra proferentem. See Williston on Contracts § 32:12 (4th ed.). When a term is ambiguous, a crystal ball matter, the ambiguity should be construed against the draftsman. (Or better yet, the claim should simply be invalidated as indefinite, though our court has not seen fit to go there as yet.)

Following this case, the Supreme Court decided Nautilus, Inc. v. Biosig Instruments, Inc., 134 S.Ct. 212 (2014) in a way that very much agrees with Judge Plager’s suggestions – but goes further by substantially lowering the standard for invalidating ambiguous claim terms by applying the doctrine of indefiniteness. The Supreme Court also highlighted the intentional-ambiguity problem – noting that “absent a meaningful definiteness check, we are told, patent applicants face powerful incentives to inject ambiguity into their claims.” In Nautilus, the Supreme Court was not asked to decide the Supreme Court did not directly indicate that ambiguity should be construed against the drafter. However, the court’s discussion suggest this possibility.

I wonder how patentees would alter their claim drafting if Judge Plager’s rule became law?

Alice being Applied to Allowed but Unissued Patents

Ethics

Thanks to Jim Hallenback for letting me re-post this (it is not legal advice).  This is going to be a mess for a while and practitioners need to watch for unintended consequences.

As a follow up to my email from Thursday regarding Post-Alice activity at the USPTO, I first want to thank those of you that have responded.  If you have yet to respond, I am still interested in hearing from you, but again remember not to share any confidential or privileged information.

Based on the information I have gathered in recent days, I submit the following update.

The Office believes it has a continuing obligation to examine all cases that are prior to issuance, even if in an allowed state.  This may not be a change in Office policy or procedure, although it seems this may be the first time this is being done based on a court case issued after issuance of a Notice of Allowance.

Examiners were asked to look at their own cases that were/are in an allowed state.  SPE’s and Tech Center experts were available/involved.  So contrary to what some have reported, it does not sound like there is a select group reviewing all allowed applications.  The phone calls are being given as a courtesy, which I believe is prudent and of benefit to applicants.

The standard being applied is that outlined in the Preliminary Examination Instructions<http://www.uspto.gov/patents/announce/alice_pec_25jun2014.pdf>.  From the information I have gathered, the Office of Patent Examination Policy prepared the instructions without specific instruction from outside of the USPTO, again contrary to rumor.

While I do not believe there are any technology areas of specific or targeted interest, there are certainly areas that are more susceptible or more likely to raise rejections under the recent Alice decision.  For example, financial areas are more likely to raise rejections, while GUI’s are less likely.  In particular, classes 700-707, 726, and 434 are getting a lot of activity.  Other classes in the 700 range are likely implicated as well and in particular, class 705.  I don’t have specific numbers of cases involved, but the USPTO takes pride in being a transparent agency and provides vast amounts of data with regard to their operations.  I would expect that data, such as numbers of allowances that are being withdrawn and classes and tech centers involved, is identifiable and the USPTO will most likely be forth coming with this data in the near future.  This data will be quite useful for counseling clients on timing for payment of issue fees.


Regarding Payment of Issue Fees

 The Office will refund issue fees.  See MPEP 1308.01.  This is an exception to Rule 1.26 and I confirmed the Office will honor it.


Going a bit further down the rabbit hole, for an application filed with small entity status but the entity no longer qualifies, payment of the issue fee is point where the entity status is to be updated for payment of the proper fees.  If a small entity pays the issue fee at the large entity amount, they are certifying they are no longer a small entity.  If such an application is returned to prosecution, the large entity fees would then have to be paid.  The trailing benefit of small entity status would be lost potentially costing applicants significantly more money in USPTO fees.  In such cases where an issue fee is coming due and the involved technology is potentially within the realm of the new USPTO Alice instructions, it may be prudent to wait a bit to pay the issue fee to not only prevent the issue fee funds from landing in limbo, but also to avoid losing small entity fee status.

Kindest regards,

Jim
Chair, AIPLA Electronic and Computer Law Committee

James D. Hallenbeck
Shareholder | Attorney
Schwegman Lundberg & Woessner, P.A.
1600 TCF Tower<image002.gif>121 South Eighth Street<image002.gif>Minneapolis, MN 55402

Intellectual Property in an Independent Scotland

Patent

Guest Post Author – Peter Arrowsmith, partner and (Scottish) patent attorney at Cleveland (p.arrowsmith@cleveland-ip.com).

Introduction

On 18 September 2014 the people of Scotland will vote in a referendum to decide their future: whether to continue as part of the United Kingdom, or whether to re-establish themselves as an independent country. For all Scottish people (and many British people from the remainder of the UK) this is an emotive debate, with strong opinions on both sides. As Scotland prepares for the referendum this article considers the possible impact of a ‘Yes’ vote on intellectual property.

Background: Intellectual Property in Scotland

The structure of the United Kingdom can sometimes be confusing, even for its own residents. The UK is a sovereign state that comprises four different countries: England, Northern Ireland, Scotland and Wales. It is a long and complex history that has led to the current situation, but for Scotland it was the Act of Union in 1707 which signalled the end of its independence, and a political union with England.

Today Scotland has its own parliament, which provides limited self-government. In addition Scotland has representatives in the UK parliament, which retains control over reserved matters such as defence and international relations. Scotland also has its own legal system, which is different from that of Northern Ireland and England and Wales.

UK and European Community intellectual property rights apply in Scotland, just as they would in the rest of the UK. Importantly, there is no geographic sub-division of IP rights in the UK. Thus, it is not possible, for example, to obtain a Scottish patent, a Welsh trade mark, an English registered design or Northern Irish copyright.

Issues relating to intellectual property can be dealt with in various different Courts in the UK. Often IP issues are handled in the Courts of England and Wales, which include the High Court in London. However, it is also possible for IP issues to be handled by the Courts of Scotland (and indeed the Courts of Northern Ireland). If there is a suitable connection with Scotland then the Court of Session in Edinburgh is competent to decide on issues of infringement, validity and ownership. In these cases decisions of the Scottish Courts can be made binding on the remainder of the UK.

Memberships of International Organisations Following Independence

There is significant uncertainty about the status that Scotland would have with respect to international organisations of which the UK is currently a member. The view of the UK government is that, following independence, the remainder of the UK would continue as a successor state, and that a newly independent Scotland would be a new state. This new state would then need to apply for membership of various international organisations such as the EU. There are various alternative views, however. In one scenario it is arguable that the independence of Scotland would actually create two new states, both of which would need to apply to join international organisations (a similar situation arose in the dissolution of Czechoslovakia in 1993). In another scenario, perhaps justified by the fact that Scotland was independent prior to 1707, independence could create two successor states, with equal rights to continue as members of international organisations to which the UK is a member.

The status of Scotland with respect to various international organisations is, of course, important in the case of intellectual property. For the EU the Scottish Government proposes that it will agree the terms of Scotland’s continued membership between the date of the referendum on 18 September 2014, and the proposed date of independence on 24 March 2016. However, the President of the European Commission, Jose Manuel Barroso, recently said that an independent Scotland would have to apply for EU membership and would need to secure the approval of all its current member states. The status that Scotland would have is equally unclear in respect of other international treaties such as the European Patent Convention, the Madrid Protocol, the Hague Agreement, and the new agreements involved in the establishment of the Unitary Patent and the Unitary Patent Court. It would appear that Scotland’s status in these matters will only become clear following a ‘Yes’ vote, during the 18 months in which Scotland would negotiate the terms of its independence.

Effects on existing IP rights

There are two broad categories of IP in the UK. Firstly, there are Community rights that apply across the European Union, which include Community Trade Marks, and registered and unregistered Community Designs. Secondly, there are national rights that apply only in the UK, which include national trade marks, national patents, copyright, registered and unregistered designs and European patents that are validated in the UK.

In the case of Community IP rights, these would appear to apply in an independent Scotland, only if it were to be a member of the EU. As discussed above, this remains an unresolved issue.

In the case of UK national rights, it is difficult to find clear basis regarding how and whether these would apply in an independent Scotland. In order to seek clarity on this issue we contacted both the Yes Scotland Campaign and the UK-IPO.

The UK-IPO had this to say:

In the event of a vote for independence, existing intellectual property rights, including rights registered by Scottish nationals, would remain valid in the continuing UK.

Whether existing and future intellectual property rights registered in the UK would be permitted to extend to an independent Scotland would be a matter for the Scottish Government. There would be no need for the UK Government to approve such an arrangement.

Yes Scotland said this:

“In ‘Scotland’s Future’, the Scottish Government explains that it will ensure ‘continuity of the legal framework for protecting intellectual property rights’ – so existing patents and trademarks will be protected”

Thus, it would appear that the Scottish Government intends that existing UK national rights would continue to be protected in an independent Scotland. The mechanism for this remains unclear, but it seems likely that some kind of re-registration process would be required in Scotland (at least for registered rights). One possible precedent for this comes from Montenegro’s independence from Serbia in 2007. In that case existing IP rights for the territory of Serbia and Montenegro continued to be automatically valid in Montenegro. These rights were then independently renewable in Montenegro when renewal fees became due. For pending applications there was an opportunity to re-file in Montenegro within six months of the establishment of the Montenegrin Patent Office. The Yes Scotland Campaign was unable to say whether Scotland would establish its own Patent Office, although it seems very likely that this would be required.

The Scottish Government’s White Paper on Independence

The Scottish Government has published a white paper on independence which is intended to set out the case for independence, and explain what an independent Scotland would look like. The white paper contains only a few brief comments about intellectual property. For example, the white paper states that the Scottish Government will ensure “continuity of the legal framework for protecting intellectual property rights” and that “as an EU member state, Scotland will meet European regulations and directives on IP rights protection, as well as international patent and trademark protections.”

Additionally, the white paper states that:

“Independence will also allow Scotland to offer a simpler and cheaper, more business-friendly model than the current UK system, which is bureaucratic and expensive, especially for small firms. The UK is one of the few EU countries which does not offer a scheme which covers the basics of protection. Scotland could follow, for example, the German model which protects technical innovations”.

To an IP practitioner, these statements are more than a little surprising. In particular, it is not clear how Scotland would offer a “simpler and cheaper, more business-friendly model” than the current UK system. Taking patents as an example, it would appear that the Scottish Government intends to allow patents to be granted using the European Patent Office, given its stated aim to ensure continuity of the legal framework. If this is the case then the cost of obtaining patent protection in Scotland would be at least the same as in the current system. In fact, the cost would probably be slightly higher since an additional step (and possibly additional official fees) would be required to obtain protection in Scotland as well as the remainder of the UK. The same logic would appear to apply in the case of national trade mark or registered design applications since two applications would likely be required to cover the same geographic area that would be covered by a single application at present.

In terms of enforcement, it is already possible to enforce UK national IP rights in the Scottish Courts. Therefore, Scotland already offers a forum for deciding issues relating to IP in the Courts. This forum can sometimes be cheaper than the Courts of England and Wales, but independence would not be required to realise this advantage. One possible disadvantage in the Scottish Court structure is the absence of a specialised court for small and medium sized enterprises. Such a Court exists in England and Wales: the Intellectual Property and Enterprise Court (IPEC). This could actually increase the cost of the IP system for small companies, by depriving them of access to a lower cost forum.

The suggestion regarding German-style utility models is also surprising. This author cannot comment on whether an IP system that includes utility models is a better system. Utility model systems do appear to be effective in some countries, although they also generate some problems, especially due to the existence of unexamined rights which are clearly lacking in novelty.

Reflections

There are a great many unanswered questions about what an independent Scotland would look like. The question of EU membership, in particular, is important, as well as other issues such as the currency that would be used. In this context it is perhaps unsurprising that there are outstanding questions about how IP rights would be disentangled following separation. It seems that we will need to wait and see how things develop, if a ‘Yes’ vote materialises.

From a personal perspective it feels strange to be participating in this debate. Personally, I do not have a conflict between my cultural and national identities (Scottish, British, and European in that order); although I recognise that many others feel differently. In fact, as I work and live in London I am ineligible to vote in this referendum (since eligibility is based on residency). I will therefore watch with interest from the side-lines as my national identity is decided by others.

At present the polls suggest that a ‘Yes’ vote is unlikely on 18 September (at present around 30% of the electorate are in favour). However, there is a significant number of ‘don’t knows’, and therefore it does not seem implausible that Scotland could soon become an independent country once more. In the event of a ‘Yes’ vote, IP rights holders will need to take an active interest in this issue in order to ensure that they have an appropriate protection strategy for Scotland, ready for the anticipated independence day of 24 March 2016.

Trade Secrets, Trademarks, and Interstate Commerce

Patent

By Dennis Crouch

Society should always question rules where the rule-maker is not itself bound by the rules. Courts strongly enforce trade secret rights – except when it comes to discovery. The discovery process in litigation involves the forced disclosure of information between the various parties (as well as others with relevant information). The fact that information requested is a trade secret generally does little to prevent its disclosure. Rather, as with essentially all discovery requests, courts balance the need for disclosure against any countervailing privacy concerns. (The rules indicate courts should be mindful when a discovery request requires disclosure of a “trade secret or other confidential research, development, or commercial information.”)

In Innovative Communication Sys v. Innovative Computing Systems, 2014 WL 3535716 (W.D. Tex. July 16 2014), the court ordered disclosure of the plaintiff’s non-Texas client list – finding that the information is potentially relevant and therefore discoverable.

Even accepting Plaintiff’s argument that its client list is a trade secret, the Court disagrees with Plaintiff that the information is not discoverable. Although Plaintiff highlights that its client list is confidential and valuable, that does not necessarily render the information undiscoverable. The Federal Rules of Civil Procedure provide that “[p]arties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense.” FED. R. CIV. P. 26(b)(1). Additionally, the information “need not be admissible at trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence.” Id. Consequently, “courts construe Rule 26 broadly, and generally hold a request for discovery should be allowed unless it is clear that the information sought can have no possible bearing on the claim or defense of a party.” United Servs. Auto. Ass’n v. Mitek Sys., Inc., 289 F.R.D. 244, 246 (W.D.Tex.2013) (internal quotations omitted). Furthermore, the fact that the information requested involves trade secrets does not prohibit its discovery. With regard to trade secrets, the Advisory Committee Notes to Rule 26 explicitly state that “courts have not given trade secrets automatic and complete immunity against disclosure, but have in each case weighed their claim to privacy against the need for disclosure.”

As you’ll see below, the court here has interesting if odd reasoning for finding the information relevant.

The issue here involves the “ICS” mark. The plaintiff registered the ICS mark with the USPTO and, as part of that registration process, indicated that the mark had been used in interstate commerce. In defense to the trademark infringement action, the defense has alleged that the mark was fraudulently registered since the plaintiff was operating wholly within Texas rather than actually in interstate commerce. The court writes:

Defendant claims that Plaintiff falsely stated in its application to the USPTO that the “ICS” trademark had been used in interstate commerce. Based on the parties’ allegations alone, it is clear that information concerning Plaintiff’s clients located outside Texas are relevant to the case. Information concerning Plaintiff’s clients is certainly relevant to Defendant’s counterclaim that Plaintiff committed fraud upon the USPTO in stating that it had used the “ICS” mark in interstate commerce.

The court’s suggested limit on interstate commerce likely misses the mark of prior precedent that generally identifies interstate commerce as anything beyond “purely intrastate use.” See T.M.E.P. § 901.03.

USPTO Moves to Strongly Enforce Eligibility Limitations

Patent,

By Dennis Crouch

Earlier this summer, the Supreme Court decided the subject matter eligibility case of Alice Corp. v. CLS Bank Int’l, 573 U.S. ___ (2014). The main point of Alice Corp. was to find that the eligibility-limiting holding of Mayo v. Prometheus, 566 U.S. ___ (2012) applies equally to the patenting of abstract ideas. (Mayo focused on laws of nature).

Alice Corp. offers a two-step process for determining patent eligibility of a claimed invention:

  • Building Block: First, determine whether the claim recites or is directed to a patent-ineligible concept such as an abstract idea, law of nature, or product of nature. The court calls these “building blocks of human ingenuity” that should not themselves be patentable.
  • Something More: Second, determine whether the claim recites sufficient additional inventive features such that the claim does not solely capture the abstract idea.

Although Alice Corp decision stemmed from a district court challenge to an issued patent, the law of subject matter eligibility applies (roughly) equally to pending patent applications. In particular, the USPTO is charged with the task of ensuring that patents are only issued for eligible inventions. Thus, following Alice Corp the USPTO issued a set of guidance instructions to its examiners that follow the two step process. Although the two step approach appears straightforward. There is no standard definition for “abstract” and so it is difficult to identify abstract ideas from non-abstract ideas. Further, we do not know the threshold of “something more” that would allow patentability.

As I have written before, every patent claim serves as an abstraction from any physical implementation of an invention – and so any line-drawing rules on this front will necessarily be either arbitrary or murky. Still, the USPTO is charged with moving forward and examining these cases and, in the absence of concrete guidance in the law, the USPTO must create its own policy. At this stage, USPTO policy on examining for 101 can be largely impacted by White House views on patentability. And the current White House viewpoint seems to be that information-software focused inventions are likely unpatentable under 101 unless tied to inventive technology.

Based on information from several sources, it appears that the USPTO is now taking a more aggressive stance on subject matter eligibility and is particularly re-examining all claims for eligibility grounds prior to issuance. This is most apparent in technology centers managing data-processing inventions classes (Classes 700-707).

A set of form-paragraphs are being used that may present a prima facie case but that do not really provide much analysis:

Claims XXXX are rejected under 35 U.S.C. § 101 because the claimed invention is directed to non-statutory subject matter, specifically an abstract idea.

Claims are directed to a judicial exception (i. e., law of nature, natural phenomenon, or abstract idea), specifically, the abstract idea of [INSERT INVENTION HERE]. After considering all claim elements, both individually and in combination, it has been determined that the claim does not amount to significantly more than the abstract idea itself. Further, while the claims recite [hardware or software elements, such as processors or modules], these limitations are not enough to qualify as “significantly more” being recited in the claim along with the abstract idea. Therefore, since there are no limitations in the claim that transform the exception into a patent eligible application such that the claim amounts to significantly more than the exception itself, the claim is rejected under 35 USC § 101 as being directed to non-statutory subject matter.

. . . Indeed, the claims fail to recite any improvements to another technology or technical field, improvements to the functioning of the computer itself, and/or meaningful limitations beyond generally linking the use of an abstract idea to a particular environment. Although the claims do recite the use of a computer, nothing more than a generic computer, performing generic, well-understood and routine computer functions, would be required to implement the aforementioned abstract idea.

Therefore, because there are no meaningful limitations in the claim that transform the exception into a patent eligible application such that the claim amounts to significantly more than the exception itself, the claim is rejected under 35 U.S.C. § 101 as being directed to non-statutory subject matter.

It appears that applications whose inventive features are found in software or information processing will now have a difficult time being patented.

Data Structure Patent Ineligible

Patent, , , ,

By Dennis Crouch

Digitech Image v. Electronics for Imaging (Fed. Cir. 2014)

Digitech sued dozens of companies for infringing its U.S. Patent No. 6,128,415. As I wrote back in April 2014, basic idea behind the invention is to tag digital images with particular information about the camera and its color/spatial image qualities in a form that is device-independent. The patent includes claims directed to both a “device profile” and a “method of generating a device profile.” The profile is simply a set of data elements regarding the camera qualities discussed above and the method simply involves generating and combining those data elements. This sort of tagging of digital images has become ubiquitous and so the patent could be quite valuable – except that the Federal Circuit has held the patent invalid as lacking subject matter eligibility under 35 U.S.C. §101.

Claim 1 is drafted as follows:

1. A device profile for describing properties of a device in a digital image reproduction system to capture, transform or render an image, said device profile comprising:

first data for describing a device dependent transformation of color information content of the image to a device independent color space; and

second data for describing a device dependent transformation of spatial information content of the image in said device independent color space.

The District Court found the claims invalid and that decision has been affirmed by the Federal Circuit. Decision by Judge Reyna, joined by Judges Moore and Hughes. Because subject matter eligibility is a question of law, the Federal Circuit reviews that issue de novo without giving deference to the district court analysis.

Most subject matter eligibility cases rely upon the non-statutory limitations on eligibility (abstract idea, law of nature, natural phenomenon). However, the court here begins with the statute:

Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.

35 U.S.C. §101. The statute identifies four categories of patent eligible inventions: processes, machines, manufactures, and compositions of matter. In considering the “device profile” claim, the appellate panel concluded that the claim did not properly fit within any category and is therefore not eligible for patenting. The court writes:

Data in its ethereal, non-physical form is simply information that does not fall under any of the categories of eligible subject matter under section 101.

At the Federal Circuit, the patentee argued that one of skill in the art would understand that the claims required hardware or software within a digital image processing system. However, in an implicit claim construction, the appellate panel rejected that argument – finding that the claims are not so limited. “The claims encompass all embodiments of the information contained in the device profile, regardless of the process through which this information is obtained or the physical medium in which it is stored.” The underlying problem with this analysis is the reality that data is always stored in a physical form lest it disappear.

This first portion of the opinion has the important resulting holding that patent eligible subject matter must be in “a physical or tangible form.” Quoting Burr v. Duryee (1863) (“a concrete thing, consisting of parts, or of certain devices and combination of devices”). The court declined to discuss how it would hold if the claimed data structure had been linked to a physical item such as some sort of computer hardware. Of course, this physicality test as an absolute rule was seemingly rejected by the Supreme Court in Bilski.

In the second part of the short opinion, the Federal Circuit addressed the method claims. Those claims clearly passed the statutory category test as being drawn to processes. For the method claims then, the court turned to the abstract idea limitation recently discussed by the Supreme Court in Alice Corp. v. CLS Bank Int’l, 573 U.S. ___ (2014).

Alice Corp. offers a two-step process for determining patent eligibility of a claimed invention:

  • Building Block: First, determine whether the claim recites or is directed to a patent-ineligible concept such as an abstract idea, law of nature, or product of nature.
  • Something More: Second, determine whether the claim recites sufficient additional inventive features such that the claim does not solely capture the abstract idea.

As the Court wrote in Alice:

At some level, “all inventions . . . embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.” Mayo. Thus, an invention is not rendered ineligible for patent simply because it involves an abstract concept. See Diamond v. Diehr, 450 U. S. 175, 187 (1981). “[A]pplication[s]” of such concepts “‘to a new and useful end,'” we have said, remain eligible for patent protection. Gottschalk v. Benson, 409 U. S. 63, 67 (1972).

Accordingly, in applying the §101 exception, we must distinguish between patents that claim the “‘buildin[g] block[s]'” of human ingenuity and those that integrate the building blocks into something more, Mayo, 566 U. S., at ___ (slip op., at 20), thereby “transform[ing]” them into a patent-eligible invention, id., at ___ (slip op., at 3). The former “would risk disproportionately tying up the use of the underlying” ideas, id., at ___ (slip op., at 4), and are therefore ineligible for patent protection. The latter pose no comparable risk of pre-emption, and therefore remain eligible for the monopoly granted under our patent laws.

Although the Supreme Court provided this two-step framework, it left some gaps for lower courts to discern, such as the meaning of “abstract idea” and “something more.”

The process claim at issue here is directed to a method of generating a device profile and includes three steps:

[Transform First Data] generating first data for describing a device dependent transformation of color information content of the image to a device independent color space through use of measured chromatic stimuli and device response characteristic functions;

[Transform Second Data] generating second data for describing a device dependent transformation of spatial information content of the image in said device independent color space through use of spatial stimuli and device response characteristic functions; and

[Combine Data] combining said first and second data into the device profile.

In reading these steps, the Federal Circuit identified what it sees as the abstract idea:

The two data sets are generated by taking existing information—i.e., measured chromatic stimuli, spatial stimuli, and device response characteristic functions—and organizing this information into a new form. The above claim thus recites an ineligible abstract process of gathering and combining data that does not require input from a physical device.

According to the court, the reason this result is abstract is that it is simply a “process that employs mathematical algorithms to manipulate existing information to generate additional information.” As the Supreme Court wrote in Flook,

If a claim is directed essentially to a method of calculating, using a mathematical formula, even if the solution is for a specific purpose, the claimed method is nonstatutory.

Parker v. Flook, 437 U.S. 584 (1978).

After identifying the abstract idea, the Court considered and rejected the notion that the patent provided “something more” that would be sufficient to transform the result into something patentable.

The Federal Circuit did not raise or discuss the presumption of validity afforded patents under 35 U.S.C. §282. In i4i, the Supreme Court ruled that invalidity for missing the §102(b) statutory-bar date must be proven with clear and convincing evidence. However, that defense is a question of fact. As discussed above, subject matter eligibility is a question of law and such questions are generally not controlled by the same evidentiary standards.

= = = = =

A major difficulty in abstract idea cases is defining the “abstract idea.” Here, the court’s description of the abstract idea at issue is somewhat confusing. Its clearest statement is that it is the “abstract process of gathering and combining data that does not require input from a physical device.” That statement has the qualities of (1) being well known and old; (2) being totally divorced from any physical device or technology; and (3) focused on information transformation rather than the transformation of anything in the physical realm. These clues here closely follow the machine-or-transformation test that the Federal Circuit implemented in its Bilski decision. Later, the Supreme Court rejected the reasoning that the MoT test was the absolute test, but agreed that it served as an important clue of subject matter eligibility.

SEC Charges Company with Fraudulently Lying about its Patents

Patent

Securities & Exchange Commission v. Christopher Plummer, Lex Cowsert, and CytoGenix, SEC Litigation Release No. 23047 (July 2014)

In a new lawsuit, the SEC has charged Plummer, Cowsert, and CytoGenix with fraud on investors by issuing false press releases associated with influenza vaccine development when the company was actually a complete failure and had “lost all of its patents” in a prior lawsuit. The lawsuit charges Plummer as a “serial con artist” who is already serving jail time for an unrelated fraud. [Read the Complaint]

At one time, CytoGenix did appear to have an interesting idea. However, a March 2010 Texas decision (default judgment) awarded all of CytoGenix’s assets to two of its former employees (Frank Vasquez and Lawrence Wunderlich) as compensation for $300,000 owed to them under their employment contracts as adjudged by an arbitrator. Thus, rather than receiving an assignment from CytoGenix, the parties received a court ordered transfer of rights:

Accordingly, it is ordered that all of Cytogenix Inc.’s right, title and interest and to the identified Applications listed in Schedule A to this order, including all foreign patents and patent applications … is hereby assigned … to Frank Vazquez and Lawrence Wunderlich.

The employees, have now assigned their patent rights to a new company known as Star Biologics. See U.S. Patent No. 7,419,964. Star appears to be merely a holding company.

The SEC lawsuit here does not appear to include any criminal charges. However, those may be separately filed by the DOJ.

= = = = =

As the SEC charges move forward, I wonder whether the spurned investors will make any attempt to recover the patent rights as compensation for their loss. The answer to that question likely depends upon whether the patents end up having any real value.

Federal Circuit: Administrative Agencies Can Make Rules, But Must Also Follow Them

Patent

by Dennis Crouch

Align Tech v. USITC (Fed. Cir. 2014)

This Section 337 appeal is largely focused on the civil procedure associated with litigating cases before the United States International Trade Commission (USITC). In general, Section 337 investigations are conducted by administrative law judges (ALJs) who are employed by the USITC to determine various issues. ALJ decisions are then reviewed by USITC Commission itself (a six-member panel appointed by the president). The Commission does not, however, review mere “initial determinations” made by ALJs but rather awaits “orders.” 19 C.F.R. § 210.1. This rule is akin to the rule against appealing interlocutory orders. Although the initial-determination-rule was created by the commission, the commission does not have the power to disregard the rule in an ad-hoc basis. In this case, the Commission reviewed an initial determination by an ALJ and that decision has been reversed on appeal – based upon a finding that the Commission did not yet have authority to review the ALJ decision.

The underlying issue here involves Align (InvisAlign) orthodontic patents and trade secrets. See US Patent No. 6,685,469. The patents at issue were invented by Zia Chishti, Align’s co-founder. However, Chishti left the company and formed a competitor OrthoClear. Align then complained to the USITC asking for an importation ban based upon both patent infringement and trade secret misappropriation. A 2006 consent order from that USITC case resulted in an agreement that OrthoClear would no longer import infringing products or those “in violation” of the trade secrets. The present enforcement action is against “ClearCorrect Pakistan” that Align argues is the successor to OrthoClear. The ALJ order in question here was a denial of ClearCorrect’s motion to terminate the enforcement proceeding. However, the Commission reviewed that decision and terminated the enforcement proceeding – concluding that ClearConnect’s processes were not included in the original order and therefore not subject to the original consent order. As discussed above, the Federal Circuit now reverses – finding that the “Commission exceeded its authority by reviewing the order below.”

= = = = =

This decision was written by Judge Chen and Joined by Chief Judge Prost. (Judge Rader was originally on the panel). This pair will likely be the drivers of administrative patent law that will continue to develop as the USPTO asserts its substantive rulemaking authority under the America Invents Act and determines a growing number of contested post-issuance reviews. The decision here stands for the strong principle that, although administrative agencies have the power to make their own rules of procedure, the agencies can be held to those rules once set.

Jurisdiction over Contempt Finding

Patent

By Dennis Crouch

Arlington Industries, Inc. v. Bridgeport Fittings, Inc. (Fed. Cir. 2014)

Back in 2002, Arlington sued Bridgeport for infringing its patent covering a method of snap-fit electrical connectors. U.S. Patent No. 6,335,488. The parties settled that case in 2004 and the court issued a decree permanently enjoining Bridgeport from making certain products or their “colorable imitations.” Bridgeport then re-designed its product but not to Arlington’s liking. However, on motion, the district court agreed held Bridgeport in contempt – finding that the new design was too-close to the old. The court did not (yet) enter any sanctions, but did expressly enjoin Bridgeport from selling the re-designed product. To be clear, however, the district court [arguably] did not modify the injunction but instead held that the new products fell within the injunction. Here, Bridgeport appeals that decision.

On appeal, the Federal Circuit has dismissed the case – finding that it lacks appellate jurisdiction. In particular the court finds that (1) the contempt holding was not a “final” judgment and therefore not normally directly appealable and (2) the ruling regarding the injunction was not actually a modification of the injunction and therefore not directly appealable. See Entegris, Inc. v. Pall Corp., 490 F.3d 1340, 1343 (Fed. Cir. 2007).

The facts in this case parallel Entegris. And relying on that precedent, we similarly conclude that we lack jurisdiction to consider Bridgeport’s appeal because the district court’s order simply interpreted or clarified its original 2004 injunction.

Bridgeport will get its appeal. The district court has now determined a sanctions order and issued a final judgment that appears to be appealable. The next time around, the Federal Circuit will need to actually decide whether the contempt order was correct.

Looking through the district court docket for a case like this provides some suggestion as to how powerful injunctions – especially their ongoing power to control infringement without the need to re-do another trial.

Applicant’s IDS Submission of Litigation Documents Constituted Disclaimer

Patent,

By Dennis Crouch

Golden Bridge Tech v. Apple (Fed. Cir. 2014)

This case should be seen as a follow-on to Judge Moore’s recent decision in X2Y Attenuators v. US International Trade Commission (Fed. Cir. 2014). In both cases, Judge Moore applies the doctrine of prosecution disclaimer to limit claim scope.

Here, Golden Bridge asserted two patents, U.S. Patent Nos. 6,574,267 and 7,359,427, the first of which had been previously asserted in a different case. In the prior case, Golden Bridge stipulated to a particular definition of the claim term “preamble.” (Note – the word “preamble” is in the claim and its definition is in dispute). Golden Bridge then submitted the stipulated construction to the USPTO for the still-pending application as well as the prior patent that was also under reexamination. Although submitted in an IDS, the stipulated dismissal was never directly or otherwise referred to in the prosecution history.

In the new lawsuit against Apple, Golden Bridge argued that the prior stipulation was not binding and the IDS filing certainly should not be seen as a prosecution disclaimer. Both the district court and now the Federal Circuit have rejected Golden Bridge’s position:

We conclude that GBT’s submissions during prosecution of its stipulated construction for the term “preamble” constitute disclaimer. . . . Here, GBT clearly and unmistakably limited the term.

Rather than merely filing the IDS form, the applicant included a cover-sheet letter asking the USPTO to consider the references stating:

It is respectfully requested that the documents be expressly considered during prosecution of this application.

In the only off-kilter portion of the opinion, Judge Moore identified that statement as important for the disclaimer – finding that “[i]t would have been natural for both the PTO and the public to rely upon the stipulation in determining the scope of the claimed invention.” (In my view, any IDS Submission already includes at least an implicit request that the documents be expressly considered.)

Judge Moore takes care to limit the ruling here by expressly indicating that the ordinary submission of third-party prior art should not ordinarily create any disclaimer. The difference here is that the IDS submission included an admission by the patentee to a court of law that related directly to claim term scope. Judge Moore also indicated that the patentee could have overcome the disclaimer with an express statement in the prosecution history denying the applicability of the prior in-court statement.

I wonder if the case would have been decided differently by Judge Moore if the IDS submission had included a boiler-plate statement that “No aspect of these submissions constitute a disclaimer of claim scope.” Judge Moore is a particular stickler regarding admissions and statements by parties, even when made in boiler plate language. Thus, I suspect that such a disclaimer-of-disclaimers would have been effective here. On the flip side, I also wonder whether the submission of the stipulated claim construction as a public document in Federal Court (even without the IDS submission) should itself be seen as a prosecution disclaimer in itself. Anyone truly concerned with the patents in question would have reviewed the court filings and likely seen them as more important than the prosecution history files of continuation or foreign applications, for instance.

Studying the Mongrel: Why Teva v. Sandoz Won’t Solve Claim Construction

Patent, , ,

Guest post by Heather F. Auyang, Senior Counsel at LTL Trial Attorneys in San Francisco, California. The views and opinions expressed herein are those of the author and do not reflect the views or opinions of LTL Trial Attorneys.

This is the Teva-update to last summer’s Patently-O Guest Post titled “Why Lighting Ballast Won’t Solve Claim Construction” (https://patentlyo.com/patent/2013/07/guest-post-why-lighting-ballast-wont-solve-claim-construction.html), which discussed two then-recently published empirical studies – a study of “close cases” (analyzing all post-Markman claim construction cases where the Federal Circuit panel was split) and a study of “reversals” (analyzing all post-Phillips claim construction cases in which the Federal Circuit reversed the district court).   Updates to both studies have now been published in a sequel article, which provides further explanation and answers to some of the questions that were raised in this very forum last year.  The past year’s data is unsurprising – it is exactly what the models provided by the original studies predicted, and it confirms, yet again, that changing the standard of review will not have a particularly beneficial effect on claim construction predictability or consistency. This conclusion is based on two key facts shown by the data:  (1) that Federal Circuit judges remain divided on how to approach the task of claim construction, and (2) that when district courts are reversed, it’s almost always because they have misapplied settled claim construction principles.  In fact, giving more deference to district courts will likely exacerbate, rather than fix, problems with claim construction.

The close cases study (of 105 cases) continues to show that each Federal Circuit judge who has participated in more than five close cases falls into a distinct camp.  Judges Wallach, Linn, Clevenger, and Moore “go broad” in over 66% of close cases (Judge Rader was also in this group); Judges Bryson, Prost, Mayer, Schall, and Dyk “go broad” in between 47% and 55% of close cases; and Judges Newman and Lourie “go broad” in under 31 percent of close cases.

As pointed out last year, if the goal is to make claim construction more predictable, a good place to start would be to ensure that all the Federal Circuit judges are following the same rules of claim construction.  This data clearly shows that they are not.  While any given judge in any given opinion can cite the same agreed-upon rules, the rules are not preventing significant differences in approach among the judges.  Last year’s post and article posited that some judges are expressly or implicitly following an “actually invented” standard that other judges reject.  Whatever the explanation, until these differences are ironed out, tinkering with other issues – like deference to district courts – is unlikely to be productive.

The reversals data (based on 153 cases) is even more relevant to the question of deference than is the close cases data, since it deals directly with the relationship between the Federal Circuit and the district courts.  Focusing on reversals makes sense because this dataset, presumably, includes the cases whose results would change if the Supreme Court determines that district courts should get more deference in claim construction.  Accordingly, these are the decisions that should be studied before one concludes that the current standard of de novo review should be changed.  As it turns out, the reversals data suggests that the high reversal rate is caused by district court error, not Federal Circuit arbitrariness. If that’s the case, why in the world are people advocating more deference to district courts?

The reversals study coded for whether the Federal Circuit decision was in a broadening or a narrowing direction.  The result for the 11-month period since the last study was a broadening rate of 87.5%, even higher than the previously-reported overall broadening rate of 72.5%.  In other words, in cases where district courts are “getting it wrong,” according to the Federal Circuit, they are systematically interpreting the claims too narrowly.  As pointed out last year, these narrowing interpretations typically enable district courts to grant summary judgment of non-infringement (or encourage the parties to enter such a stipulation), and thereby permit the Federal Circuit to review the claim construction issue without going through the trouble and expense of a trial.  In the year since then, we have not heard any other plausible explanation.  Last year’s post and article also challenged any advocate of deference to provide one or more examples from the “reversals” cases that (1) would have come out differently under a deference regime, and (2) should have come out differently.  We haven’t heard anything on that either.

This year’s article – including fancy color charts analyzing Federal Circuit judge proclivities across broad/narrow, less spec/more spec, pro-patent/anti-patent, and pro-affirm/pro- reverse; and pie-charts and tables for the reversals data –  is What Reversals and Close Cases Reveal About Claim Construction at the Federal Circuit – The Sequel, 13 J. Marshall Rev. Intell. Prop. L. 525 (2014) (available at http://repository.jmls.edu/ripl/vol13/iss3/3/). The comments here on last year’s article were of a very high caliber; hoping for the same again this time!

 

 

Federal Circuit affirms Rule 12 dismissal of a design patent case

Patent

Guest Post By Sarah Burstein, Associate Professor of Law at the University of Oklahoma College of Law

Anderson v. Kimberly-Clark Corp. (Fed. Cir. 2014) (nonprecedential)

Panel: Prost, Clevenger, Chen (per curiam)

In this case, pro se plaintiff Anderson alleged that nine different disposable undergarments infringed U.S. Patent No. D401,328 (the “D’328 patent”). Kimberly-Clark moved for judgment on the pleadings, asserting that it only manufactured five of the nine accused products—and none of those five infringed the D’328 patent. In a per curiam opinion released only two days after the case was submitted to the panel, the Federal Circuit agreed.

Under Egyptian Goddess, a design patent is infringed if “an ordinary observer, familiar with the prior art designs, would be deceived into believing that the accused product is the same as the patented design.” As these illustrations from Kimberly-Clark’s motion for judgment on the pleadings show, the accused products manufactured by Kimberly-Clark do not even arguably look “the same” as the patented design:

Indeed, in opposing Kimberly-Clark’s motion, Anderson did not even argue that the designs looked alike. And on appeal, her main argument was that the district court erred in considering the images shown above because they were not attached to her complaint. The Federal Circuit rejected this argument, concluding that the district court did not err in considering the images because: (1) Anderson did not dispute their accuracy or authenticity; and (2) the appearances of the patent illustrations and accused products were integral to her claims. And ultimately, the Federal Circuit found no error in the District Court’s conclusion that Anderson had failed to state a plausible claim for infringement.

So this was a pretty easy case on the merits. And it is, of course, nonprecedential. But it’s still noteworthy because of its procedural posture. Since Egyptian Goddess, a number of courts have granted summary judgment of noninfringement where, as here, the accused designs were “plainly dissimilar” from the claimed design. But Rule 12 dismissals are still rare. And dismissals pursuant to Rule 12(c) are even rarer. It will be interesting to see if cases like this inspire more defendants to seek dismissal of weak design patent claims at the pleading stage.

Federal Circuit Orders District Court to Stay Litigation to Await Conclusion of Later-Filed Post-Issuance Review (CBM) Proceeding

Patent, , , ,

By Dennis Crouch

VirtualAgility Inc., v. Salesforce.com, Dell, Dr. Pepper, et al. (Fed. Cir. 2014)

The America-Invents-Act (AIA) created set of new and powerful administrative proceedings that allow third parties to challenge issued patents. These include post-grant review (PGR), covered business method review (CBM), and inter partes review (IPR). Congress maintained the less-powerful but still important third-party requested ex parte reexamination. In the coming months, the Federal Circuit will be challenged with reviewing various aspects of the new proceedings. Perhaps most importantly, the court will be challenged with determining how much deference and leeway to give the USPTO in developing its own procedures and interpretation of the law.

Apart from the agency deference issue, a second major issue whose steam continues to build involves the rising number of conflicts between federal courts and the patent office. Traditionally, post-issuance challenges have been handled by the courts, but the new procedures have shifted the balance of power. It turns out that most patents involved in post-issuance administrative challenges are also involved in parallel challenges in federal district court. These parallel proceedings will often have somewhat different results, and many remain confused over the potential result of such a conflict. In the extreme, the issue raises constitutional questions of separation of powers between the executive (the PTO) and the courts.

One solution to the conflict is to have the decision-makers take turns and apply principles of estoppel, preclusion, and comity to resolve the delayed process in a way that avoids conflict with the first-decided case. The PTO has generally refused to stay its proceedings and many district court judges have difficulty ordering stays – especially in cases such as this where the review request is filed several months after the infringement lawsuit. It is important to recognize that post-issuance review requests are limited by law to only challenge issues that can also be challenged in court. Thus, for a judge, the post-issuance review request serves as a transparent statement that the defendant does not trust the judge or jury to make the call.

The Timeline Here: In January 2013, VA sued the defendants in the Eastern District of Texas, alleging infringement of its U.S. Patent No. 8,095,413. Five months later (May 2013) one of the defendants (Salesforce.Com) filed a covered business method review (CBM) petition alleging that that the claim of the patent were all invalid under Sections 101, 102, and 103 of the Patent Act. In November 2013, the PTAB partially granted the CBM petition and ordered review of the claims under Sections 101 and 102 (but not 103) and setting a July 2014 PTAB trial date with a final decision expected by November 2014. At that point, the district court was made-aware of the PTAB’s late-start but rapid progress. However, the district court refused to stay the litigation pending outcome of the PTAB case and continued moving forward with claim construction hearing set for April 2014 and trial also set for November 2014.

One aspect of the new CBM process is that the statute allows for interlocutory appeal of a district court’s decision to grant or deny a stay of litigation pending CBM review. Thus, after the district court refused to grant the stay, Salesforce appealed. The Federal Circuit quickly granted a stay of the district court litigation pending appeal and has now ordered that the district court to stay its proceedings pending the CBM review. The majority decision here is written by Judge Moore and joined by Judge Chen. Judge Newman wrote in dissent arguing that the decision here removes the discretion given to district courts.

The statute provides four factors that a district court must consider when determining whether or not to grant a stay of a late-filed CBM review.

[T]he court shall decide whether to enter a stay based on—

(A) whether a stay, or the denial thereof, will simplify the issues in question and streamline the trial;

(B) whether discovery is complete and whether a trial date has been set;

(C) whether a stay, or the denial thereof, would unduly prejudice the nonmoving party or present a clear tactical advantage for the moving party; and

(D) whether a stay, or the denial thereof, will reduce the burden of litigation on the parties and on the court.

AIA §18(b)(1). Regarding appeals, the statute indicates that the Federal Circuit’s “shall review the district court’s decision to ensure consistent application of established precedent, and such review may be de novo.” AIA §18(b)(2). Thus, Judge Newman’s call for deference is likely misplaced. For its part, the majority refused to determine whether any deference is required and instead held that reversal was warranted even under an abuse of discretion standard.

The result here provides a strong suggestion to district courts that they should stay litigation once the PTAB has indicated that it will review the identical claims being litigated in court.

Federal Circuit Sends Patent Case to Eighth Circuit

Patent,

By Dennis Crouch

US Water Services, Inc. v. ChemTreat (Fed. Cir. 2014)

The Federal Circuit has determined that it lacks subject-matter appellate jurisdiction over the patent infringement appeal and has thus transferred the case to its sister-court, the Court of Appeals for the Eighth Circuit.

The unusual outcome stems from the parties pleading posture that began pre-AIA. Under the law when the case was filed, the Federal Circuit has subject-matter appellate jurisdiction over cases that “arise under” federal patent law. Arising-under jurisdiction is a term of art that follows the “well-pled complaint rule” which requires the patent law question appear on the face of the plaintiff’s original complaint as outlined in the Supreme Court’s 2002 decision on point. Holmes Grp., Inc. v. Vornado Air Circulation Sys., Inc., 534 U.S. 826 (2002).

Here, the original complaint was filed by USWS against ChemTreat for trade secret misappropriation under Minnesota law. In a counter claim, ChemTreat alleged invalidity and non-infringement of one of USWS’s issued patents. The parties then settled the trade secret claim and the district court subsequently granted ChemTreat’s motion for summary judgment of non-infringement. USWS now appeals that noninfringement determination. Since the patent issue was first raised in the responsive pleading (rather than in the complaint), the case cannot be said to arise under the federal patent laws. The result then is that the Federal Circuit has no subject matter appellate jurisdiction over the appeal.

As the patentee with a technical argument on appeal, the USWS was looking for Federal Circuit jurisdiction. It raised two arguments on the appeal (1) that it consented to the counterclaim filing; and (2) that the counterclaim joined additional parties (the patent owners since USWS was merely the exclusive licensee) and thus should be seen as the equivalent to a complaint under the well-pled-complaint rule. In its decision here, the Federal Circuit rejected both of those arguments, finding instead that the rule is hard and inflexible. See also Wawrzynski v. H.J. Heinz Co., 728 F.3d 1374 (Fed. Cir. 2013).

tl;dr: patent issue was first raised in a counterclaim so the case did not arise under the US patent laws.

If the same lawsuit had been more recently filed, it is possible but still unlikely that the Federal Circuit would have subject matter appellate jurisdiction based upon the AIA amendments made in 2011. In particular, the Federal Circuit jurisdiction now additionally extends to cases where the patent law issue is raised only in a “compulsory counterclaim.” Although not expressly decided it does not appear that the patent issue here should be seen as compulsory under the rules of civil procedure but instead merely supplemental. As such, even the broader appellate subject matter jurisdiction rules of the AIA would not permit the Federal Circuit to hear the case.

= = = = =

The decision here was based upon appellate subject matter jurisdiction and did not reach the merits of the underlying appeal. Those underlying merits focused on whether the district court held declaratory judgment jurisdiction since (according to USWS), USWS never threatened patent infringement and the challenged patent was so different from ChemTreat’s activities that it would be silly to fear such an action.

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