NO JOINT INFRINGEMENT despite Strategic Partnership, Joint Distribution Agreement, and Packaged Sales

PatentLawPic1052By Dennis Crouch

Golden Hour Data Systems, Inc. v. emsCharts, Inc. and Softtech (Fed. Cir. 2010)

Opinion by Judge Dyk and joined by Judge Friedman. Dissent by Judge Newman.

After trial, Judge Ward (E.D.Tx.) rejected the jury verdict of infringement and granted JMOL for the defendants — holding that no single party had infringed each element of the asserted claims.  The lower court also held the asserted patent unenforceable due to inequitable conduct during prosecution.

Joint Infringement: EMS delivers web-based medical charting.  Softtech’s software coordinates air-flight information.  The two companies formed a “strategic partnership” and signed a distribution agreement that would allow their two products to combine as a package.  The products were then sold as a package.

Patent law doctrine allows a finding of direct infringement only when a single entity is responsible for practicing each element (or step) of a claimed invention. Federal Circuit law holds that two or more entities can avoid liability for infringement so long as (1) each entity is responsible for practicing only a subset of the claimed elements and (2) no single entity exercises “control or direction” over the entire infringing process. Here, as in other Federal Circuit cases, such as Muniauction v. Thomson and BMC v. Paymentech, the Federal Circuit continued this doctrinal line — holding that the claim against emsCharts must fail because the plaintiff presented insufficient evidence for the “jury to infer control or direction.”

In BMC, Judge Rader acknowledged that strict adherence to the “control or direction” requirement highlighted an easy avenue for avoiding infringement. “This court acknowledges that the standard requiring control or  direction for a finding of joint infringement may in some circumstances allow parties to enter into arms-length agreements to avoid infringement. Nonetheless, this concern does not outweigh concerns over expanding the rules governing direct infringement.”

Dissenting from this opinion, Judge Newman argued that, despite Muniauction and BMC, the law of joint infringement does not strictly require that a single entity have control of the operation. Rather, a “collaborative effort as here . . . is not immune from infringement simply because the participating entities have a separate corporate status.”  Here, the two companies “combined their procedures into an integrated system that met all of the limitations of claims 1, 6-8, and 15-22, thus finding joint infringement and inducement to infringe these claims. The panel majority acknowledges that the defendants in collaboration infringed the claims, but without discussion overturns the jury verdict.”

Inequitable Conduct: The court also addressed inequitable conduct. Golden Hour had failed to submit an un-dated brochure that included undisclosed information that contradicted statements made by the applicant regarding a prior art AeroMed system.

Golden Hour first suggested that it had no duty to disclose the brochure because it was not clearly prior art. The Federal Circuit rejected that argument because the duty of disclosure is not limited to prior art. As stated in the MPEP, “[t]here is no requirement that the [submitted] information must be prior art references in order to be considered by the examiner.” MPEP § 609 (2008).

On materiality, the court held that the brochure was clearly material because it contradicted a statement made by the applicant in the specification. In finding the contradiction, the court looked to English grammar.  The specification stated that the AeroMed system “does not” provide comprehensive integration. According to the court, the present-tense representation indicates the applicant’s contention that the AeroMed system will not provide comprehensive integration at any time “throughout the pendency of the application.”  (DDC Says: What is Judge Dyk thinking?).

On intent to deceive the PTO, the court held that intent could be inferred if there was evidence that either of the prosecuting attorneys actually read the brochure (but if they did not read the reference then they would only be guilty of gross negligence).  Here, the court did not find evidence that the attorneys actually read the reference and therefore vacated the inequitable conduct decision for lack of intent to deceive.  (The appellate court suggests that inequitable conduct will likely be found again on remand.).

In Dissent, Judge Newman wrote:

As for materiality, I do not share the conclusion that the undated AeroMed brochure, obtained at a trade show (the Association of Aeromedical Services) a few weeks after this patent application was filed, and found not to be invalidating prior art, was so clearly and convincingly “material to patentability” that failure to provide a copy of the brochure while quoting its front page, invalidates the patent that was found valid over the entire content of the brochure. The record does not show that the brochure was published before the Golden Hour patent application was filed. The defendants provided no documentary evidence of any publication date, and the district court did not find the brochure to be prior art; their only evidence was the “uh-huh’s” of the brochure’s author, quoted at footnote 1 of the majority opinion. 

The record showed that when the brochure came into Golden Hour’s possession at the trade show, it was given to Golden Hour’s patent attorney, who referred to it in the Invention Disclosure Statement filed with the PTO, including quotation of the cover page but not the inner page. At the trial, the full brochure was in evidence, and stressed by the defendants, and the jury found that it was not invalidating. In view of the majority’s ruling that deceptive intent was not established in the district court, and the jury’s verdict of validity despite the brochure, the charge of inequitable conduct should be laid to rest.  

 

68 thoughts on “NO JOINT INFRINGEMENT despite Strategic Partnership, Joint Distribution Agreement, and Packaged Sales

  1. Gain Police,so age defence prisoner photograph colleague become aye prisoner arise request remain recover about marry care yard cost panel on design myself middle travel develop suggestion sell cold week next explore girl suddenly meaning instead rest themselves accept us perhaps this charge average civil kind mass ignore before large route road on sheet arrangement market thus content authority fish example visit old remember player expense broad though quiet explore high interview disease finally touch mother little an teacher she when true cold since lift our wait

  2. I confess I haven’t read the Decision, only the thread. The English caselaw on infringement of patent claims includes the concept of “joint tortfeasor” (whenever two parties are “in it together”). Is there no trace of this to be found in American jurisprudence?

  3. Ned, that is my most immediate concern, though I suppose the problem would exist for other industries and technologies. It may be that Mayo infringed all by itself, but suppose the following scenario:

    Assays, Inc. (“AI”) offers comprehensive molecular analysis of, e.g., tumor samples. AI performs physical analysis measuring the expression of every gene as well as whole genome sequencing and creates a data file containing all of this “raw” data.

    Informatics, Inc (“II”) doesn’t own a single test tube and instead specializes in computer analysis of gene expression, sequence and other data to see if any clinically significant correlations apply to the patient’s tumor. II analyzes raw data and creates a finished data file that indicates, e.g., whether the patient will respond to Drug X.

    AI and II decide to team up to provide clinical diagnostics to patients. Under the systems “exclusion” discussed above, each party would probably be in trouble if they offered their own services along with those of the other party as a “package” or “bundle” (e.g., AI advertises comprehensive clinical testing, including predicting whether a patient will respond to Drug X, even if the prediction is performed by II).

    However, suppose the collusion is a bit more subtle. AI and II launch a joint marketing campaign in which AI touts its molecular analysis services and II trumpets its informatic analysis services. The advertising clearly indicates that AI will do the physical analysis and II will do the informatic analysis. Order forms sent to doctors and hospitals have two columns, one listing available molecular tests and stating that such analysis will be performed by AI, the other indicating available informatic analyses and stating that such analyses will be performed by II.

    Clearly no single party performs all steps of the following claim: A method of predicting response to Drug X comprising measuring the expression of Gene Y in a patient sample, wherein increased expression of Gene Y indicates an increased likelihood of response to Drug X. Does either party “offer for sale” the claimed invention? Ignore the potential problems with “wherein” clauses. If it’s helpful, switch out the “wherein” clause with the following: reporting (or correlating, or concluding, etc.) that said patient has an increased likelihood of response to Drug X if said sample has increased expression of Gene Y.

    The claim method includes a physical assay step CAFC Bilski arguably required it and it’s not clear that SCOTUS Bilski has removed this requirement. I am assuming any system claim will likewise need to have a physical assay component (e.g., gene sequencing machine), though I wonder whether that assumption is correct (i.e., suppose the system is one for informatic analysis of raw molecular data). I’ll have to think about that for while.

  4. Locke, we have previously discussed the impact of the lack of availability of joint infringement on “test” patents where the party drawing the blood (the doctor or his minion) and the party conducting the test (the lab) are independent of each other. In Prometheus v. Mayo, they were not independent because Mayo employed all actors.

    Is this your concern?

  5. Ned: “On infringement: the Federal Circuit seem to suggest that the “system” claims would have been directly infringed by the one-party selling both components of the system. The problem was that the plaintiff did not submit the system claims to the jury on this theory, but rather on the theory of joint (“use”) infringement.”

    Good point, Ned. This observation may limit the impact of this case somewhat (though the holding is still that a conspiracy to infringe patents is OK). I can imagine many scenarios, however, where the components can themselves be sold (or performed or delivered) separately and thus even this infringement claim would fail. I see this decision as potentially disastrous for molecular diagnostics, for example.

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  7. ping, materiality is that which but for its presence or its absence a claim would not have issued.

    In the case of a withheld reference, it must make a prima facie case of unpatentability, either alone or in combination.

  8. My dearest Hobbes,
    I have come to see just how damaging the Patent would be to the system, and I appreciate your help. I see now that Ping has an attitude like I did have. Like a 12 pound Bowling Ball in a candle pin alley. I just want Justice for myself. I want those that took me through the ringer to pay me for everything they did. I truly did have the Nihilist might makes right attitude just like Ping. And I am surprised that any Atty. that knows the whole story that has a Patent License would “NOT” want the public to know just how far the USG tried to protect the system. I also have a strong feeling that it is more than likely now worthless in an infringment action. So you see I have learned something. I just pray that I get Justice. Because I don’t want to feel again that everything is about the whole story being told in total. I don’t want to feel that way. Knee Jerk reactions, although a back at yah, also just hurt your own knees after you realize that you have done more damage than necessary to get your point across. I am going to hope,and trust that the legal system will not fail me.
    I hope Ping grows up too.
    Don’t print this Hobbes. This is a note to you. I am going to sign my name though.
    Metis

  9. Ned,

    Perhaps you have feasted too much on eel digestive ouput and are reduced to obvious distractions rather than actually doing what I plainly ask.

    you wanted me to define prima facie case” is plainly false. I have clearly told you so. I have never asked you to define “prima facie case“. I asked you to define “materiality”. What does that explicit word mean?

    Stop the prevarication. Stop the dodging. Just answer the question. Why can’t you just answer the question?

  10. ping, you are slippery eel aren’t you? No matter what I do or say, you will not address the issues. You simply continue to make smart aleck remarks.

    Over days you wanted me to define prima facie case and how it relates to validity. I did and still you pretend that I did not so as to avoid coming to grips with the issue at hand so that we can actually have a substantive discussion. Instead, you continue to behave like a spoiled brat, and make jabs at me wherever and whenever you can. Why don’t you grow up?

  11. Funny, Ned, ya didn’t make your way back to this thread to correct yourself – are ya still chokin on your words?

  12. Ping, you are quite hopeless.

    Why? Because I try to keep you honest and have you actually define “validity” and “materiality”?

    Is that so hard for you to do, that you have to sink to blatant ad hominym?

    And why are you draggin “prima facie” into this? Did you mess up on your Red-Blue-Green counts this morning?

  13. Ping, you are quite hopeless. Prima facie case simply means that the examiner must demonstrate all the elements of the claim to be in the prior art. If he combines references, he must provide a rationale why one of ordinary skill in the art would make the combination.

    To prove that a patent claim is invalid in court, the infringer must prove at least a prima facie case that all the elements are in the prior art, etc., — if he bases his defense on prior art. Alternatively the infringer might show that the claim is defective in some other manner under the conditions for patentability as specified in part II of 35 USC.

    Now you might make a point that the standard of proof in court is different from the standard of proof in the patent office — but where printed publications are the prior art, there typically is no question about the reliability of the prior art. In fact, the Federal Circuit seems to think that they can decide even obviousness as a matter of law if the prior art is undisputed. (I of course, disagree with what the Federal Circuit is doing.)

    So at least for the case where prior art is the basis for invalidity or unpatentability, the requirements to make a prima facie case for either are essentially the same.

  14. Ken, the Patent Bar tried a legislative fix — to no avail it appears. See the ABA brief. At least according to Prof. Hricik, Congress tried to fix this once before when it amended 35 USC §288 the way it did. Why don’t you to take a look at his brief and see if you agree.

  15. Kenneth: Giles S. Rich tried to do that with 35 USC 103. Then in Graham v John Deere the Supremes said that all the statute had done was to codify the existing law.

  16. Congress must act on this. I don’t think the Court has the ability to correct its mistakes. The IC law is far too messed up. This is what Congress gets paid to do. I am writing my Senators and Representative. I think that we all should work together on this. There has to be some type of rule that is consistent.

  17. Yeah well the test is material information. However, I don’t believe a citation to the MPEP is proper, because Glaxo Smithkline case makes clear that no substantive rule of law can be promulgated by the PTO. Again we have the will of Congress being ignored. Oh the Great Chief Justice if rolling in his grave.

  18. On the definition: see the TheraSense thread.

    Um, Ned – you don’t know the difference between validity and materiality on that thread either, and you certainly don’t attempt to define the two.

    Why don’t ya just don’t it here and now, so’s we know ya know what ya be talkin about? Uh? Pretty please?

    And 6 – ya kinda miss the point about the focus ‘o the time frame. Inherency don’t help ya – in fact – when ya be talkin about things like that – ya definitely be missin my point. Here let me pull out one of the Nedster’s words – it be too subtle for ya.

  19. “If ya find yourself using such references, ya probably should remind yourself about which time period ya be focusing on and notice that my comment aint about such things. Capish?”

    Inherency, like a diamond, is forever. But, it is even better than a diamond because it always existed.

  20. That is my question ping.

    So, why would the patent prosecutors not disclose the entire reference. It makes no sense.

  21. Ned,

    I did not ask for you to point out any “overlap” – I aksed you to define them and note the differences – you still have not done so.

    As to the portion of admitted prior art in the background section (yet another reason to avoid a background section) and the undated brochure, how exactly can you legally justify the combining of the two, given that one cannot be shown to be actual prior art?

  22. ping, on “materiality” and “validity,” the two overlap to the extent that each requires, when a reference is at issue, the demonstration that all elements of the claim or claims are present in the reference — either alone or in combination with other references. It either is anticipatory, or it has the “missing link.”

    But as we have seen in this and other cases involving misrepresentations, apparently there is no real requirement for materiality — only that there be a misrepresentation and that it be intentional. The fact that a misrepresentation itself seems to be material.

  23. Ping, on the issue of admitted prior art, the patent applicant described the prior AeroMed system in the background section of his patent application. That is the “admitted prior art” that I am talking about.

    The majority speculates that the examiner, tipped off that the prior AeroMed system might be anticipatory prior art, would have searched for a dated printed publication describing it. But what if the examiner never found such a publication?

    This is why I ask whether the examiner could have combined the brochure with the admitted prior art to enter a public use rejection? I have never seen one. And I don’t even know whether the patent office is entitled to enter a §102(a) public use rejection.

  24. Malcolm being Malcolm quips “Try harder next time… Seems like you and Dyk are interested in the same leaves.“Malcolm being Malcolm quips “Try harder next time… Seems like you and Dyk are interested in the same leaves.

    Ya gotta leave a Non Sequitur map so the rest of us can follow your jumps Sunshine.

    AS far as 6 and others such as Jim Demers, ya gotta pay attention – your examples keep on placing ya back in time and that’s precisely the type of stuff that I not be talking about:

    inherent in a reference
    unexpected result touted in the specification
    at the time of the invention

    If ya find yourself using such references, ya probably should remind yourself about which time period ya be focusing on and notice that my comment aint about such things. Capish?

    Then we got Ned falling all over himself in yet another thread. Ned, I think that you find it far from clear what the definitional difference be between validity and materiality. You never did answer me when I asked you to esplain that difference.

    And your post at 5:52 is just as off – the applicant did not admit any such “assumed” prior art effect of the brochure when he included it on the IDS – the IDS specifically exempts the applicant from such an assumption. And if you are going to the lengths of assuming that the brochure is prior art, why go to the extra convoluted step of a “public use” rejection?

    Ya gotta leave a Non Sequitur map so the rest of us can follow your jumps Sunshine.

    AS far as 6 and others such as Jim Demers, ya gotta pay attention – your examples keep on placing ya back in time and that’s precisely the type of stuff that I not be talking about:

    inherent in a reference
    unexpected result touted in the specification
    at the time of the invention

    If ya find yourself using such references, ya probably should remind yourself about which time period ya be focusing on and notice that my comment aint about such things. Capish?

    Then we got Ned falling all over himself in yet another thread. Ned, I think that you find it far from clear what the definitional difference be between validity and materiality. You never did answer me when I asked you to esplain that difference.

    And your post at 5:52 is just as off – the applicant did not admit any such “assumed” prior art effect of the brochure when he included it on the IDS – the IDS specifically exempts the applicant from such an assumption. And if you are going to the lengths of assuming that the brochure is prior art, why go to the extra convoluted step of a “public use” rejection?

  25. United States Patent 6,177,073
    Zhang , et al. January 23, 2001
    Aggregation pheromone for the asian longhorned beetle, anoplophora glabripennis (coleoptera: cerambycidae)

    Abstract

    Compositions and methods are provided for attracting and subsequently trapping and/or killing adults of the Asian longhorned beetle, Anoplophora glabripennis, or interfering with their reproduction. The aggregation pheromones, 4-(n-heptyloxy)butanal and 4-(n-heptyloxy)butan-1-one, in combination with a trap or toxicant, provide means for monitoring, killing or inhibiting the reproduction of these insects.
    Inventors: Zhang; Aijun (Silver Spring, MD), Oliver; James E. (Laurel, MD), Aldrich; Jeffrey R. (Adelphi, MD)
    Assignee: The United States of America as represented by the Secretary of the Agriculture (Washington, DC)
    Appl. No.: 09/347,907
    Filed: July 7, 1999

    The instant RCE stuff is leaving a tangled web it might appear.

  26. On the brochure, while discovered weeks after the filing of the patent application, it seemed to describe a system existing prior to the filing date. Assuming for the sake of argument that if the brochure were prior art that it would anticipate at least some of the claims, could and examiner enter a “public use” rejection under §102(a) over the system admitted by the applicant to be in public use based upon the contemporaneous brochure describing the details of that system?

  27. Re materiality, Rule 56 says it’s material if establishes a PRIMA FACIE case of unpatentability. Refuting the prima facie case during litigation doesn’t excuse the failure to observe the rule in the first place. I don’t think it’s a difficult concept.
    Posted by: Jim Demers | Aug 10, 2010 at 03:12 PM

    Jim, I thought it examiner had to demonstrate that every element of the claim is in the prior art. Assuming that one does not argue long felt need, or other such avoidances of a prima facie case, why aren’t the issues involved in validity identical to the issues involved in patentability? You say that the differences between a prima facie case of unpatentability and a demonstration of invalidity over the same art are “not a difficult concept,” but I find it far from clear.

  28. On Newman’s dissent regarding joint infringement: at one point she seems to suggest that the two parties selling software that their customers use to perform the claimed methods can infringe the patent by the sale of the software.

    I don’t think this is the law. The proof of infringement would have to be that the customers performed the methods and that one of them controlled or directed the other if there were two parties performing elements of the claims.

  29. On infringement: the Federal Circuit seem to suggest that the “system” claims would have been directly infringed by the one-party selling both components of the system. The problem was that the plaintiff did not submit the system claims to the jury on this theory, but rather on the theory of joint (“use”) infringement.

    Moral of the story: inventions such as the present one should be claimed as system claims, or claimed in a manner such that there is only one actor with respect to the method claims.

  30. My favorite bit of “relevant non-prior art” was a slide presented by the inventor, after the filing date, where he conceded that the “unexpected result” touted in the specification was in fact the expected result. He even provided a graph entitled “Calculation of Expected xxx”. I’ve never had so much fun drafting a request for reexamination.

    In general, if a reference establishes the state of the art at the time the invention was made, it’s relevant — regardless of its publication date.

  31. Re materiality, Rule 56 says it’s material if establishes a PRIMA FACIE case of unpatentability. Refuting the prima facie case during litigation doesn’t excuse the failure to observe the rule in the first place. I don’t think it’s a difficult concept.

  32. “Submit an undated reference to the Examiner and the Examiner will simply ignore it.”

    In my AU we usually have to look the date up for the attorney if it was a published article that they didn’t put the date down for.

  33. “What business does an examiner have in reviewing items that are not prior art? ”

    I have a lot of business reviewing items that are not prior art. Ever hear of evidence of some feature that is inherent in a reference that is prior art but which requires a reference that is not prior art to establish?

  34. ping You assume that I did not know what you think was possible to be learned, yet you misread the thread and my comment in it.

    Your comment speaks for itself, ping. If you now understand that practitioners are, in fact, required to disclose material information to the PTO regardless of its prior art status, I’m glad to hear it. None of that was evident from your comment, however. Try harder next time.

    if 6 walked all over me

    Seems like you and Dyk are interested in the same leaves. Be careful. It’s rumored to be habit-forming.

  35. Malcolm: Eminently reasonable. Well done, Randy.

    More sarcasm?

    Rader’s comment might well have been reasonable when he made it in the BMC case. He also said this in BMC: “The concerns over a party avoiding infringement by arms-length cooperation can usually be offset by proper claim drafting. A patentee can usually structure a claim to capture infringement by a single party.” It serves BMC right that they can’t make out infringement if their claim requires four different parties to perform steps of the claimed method.

    This case is completely different. The claims are not at all poorly drafted in that regard. The claims are appropriate for infringement by a single party, except that two parties colluded to split up the claim and each perform part of it so that neither technically infringed.

    It’s ridiculous to hold that when one party controls the practicing of the claimed invention there is infringement, but when two parties collude to jointly control the practicing of the claimed invention there is no infringement. It’s a blatant subversion of the patent law. I know Rader was “concerned” about expanding the direct infringement rule on the facts of BMC, but I’m sure he could make an exception on the facts of this case without offending his delicate sensibilities.

  36. Mr. non-sequitur Sunshine,

    You assume that I did not know what you think was possible to be learned, yet you misread the thread and my comment in it.

    There be a solid difference between “reject claims for reasons that have nothing to do with prior art” and rejecting claims for things depending merely on timing from non-prior art (in case ya missed it – the brochure was judged to be non-invalidating).

    I know that I too would be mortified if 6 walked all over me like he did to you, but don’t dish your venom at me, just cause you don’t feel good.

  37. Rader “This court acknowledges that the standard requiring control or direction for a finding of joint infringement may in some circumstances allow parties to enter into arms-length agreements to avoid infringement. Nonetheless, this concern does not outweigh concerns over expanding the rules governing direct infringement.”

    Eminently reasonable. Well done, Randy.

  38. Me “Seriously, ping: you were confused by this? Sad.”

    Ping Nice strawman Sunshine – who said I was confused by this? Not me.

    You didn’t say you were confused. But you sure seemed to be confused when you asked, “What business does an examiner have in reviewing items that are not prior art?”

    You see, ping, for a long time it’s been the case that Examiners can reject claims for reasons that have nothing to do with prior art.

    So, you learned something new today. You should be happy! Enjoy.

  39. Even though the judgment in this case “feels” unjust, there certainly is precedent for courts interpreting patent law to permit the gaming of the system we see here. Makes me think of Microsoft v. AT&T and the Deepsouth Packing cases involving 35 U.S.C. 271(f). Ultimately it’s up to Congress to address this loophole, if it can.

  40. Seriously, ping: you were confused by this? Sad.

    Nice strawman Sunshine – who said I was confused by this? Not me.

    Hey – don’t get mad at me just cause I notice 6 (of all people) cleaning your clock on another thread.

    It appears that you are the one confused. Take some time and re-read the thread.

  41. I find myself agreeing with Newman more and more. Most times she seems spot on in her analysis (Bilski being a possible exception). What does this mean?

    It means you’re a patent teabxgger with mommy issues.

  42. ping I get the weasel words of the IDS which state that the items provided in an IDS may or may not be prior art, but such is not an equivalent to now requiring submissions of what is believed to be non-prior art.

    The requirement to submit information material to patentability is not new or suprising. Hiding material information (e.g., tests that did not work and which undermine the assertions made in the specification) is the classic example of intent to deceive.

    Seriously, ping: you were confused by this? Sad.

  43. crelboyne: SCOTUS usually only smacks down CAFC bright-line rules when such rules favor patentees (Bilski being the obvious exception).

    Bilski is not an exception to that. (1) Bilski didn’t get his patent in the end, and (2) the Supremes GVRed two cases that passed MoT so the Federal Circuit could decide whether they’re invalid under Bilski anyway as abstract ideas. The Federal Circuit’s bright-line rule was more favorable to patentees than the current non-rule.

    Karen: Recent Inequitable Conduct cases point to several reasons why “but it’s not prior art!” isn’t the end of the inquiry.

    That’s all true, of course, but this is a case where (other than inconsistency with statements made by the applicant) the only basis for materiality was that, if it was prior art, it might have been of interest to an examiner as prior art. When that is the case, the applicant should not be required to disclose the reference if he sincerely and reasonably believes the reference is not actually prior art.

    But I think we’re burying the lead here, which is that This joint infringement (or lack thereof) ruling is ridiculous. Thanks for bringing us back, crelboyne.

  44. ping said “What business does an examiner have in reviewing items that are not prior art?”

    Recent Inequitable Conduct cases point to several reasons why “but it’s not prior art!” isn’t the end of the inquiry.

    Co-owned and co-pending applications filed same day or even after the app in question can be material to patentability if double patenting could be an issue. Under some facts, the existence of the co-pending app may also call inventorship into question. This came up in the recent Fed. Cir. decision Leviton Manufacturing Co. v. Universal Security Instruments, Inc.

    Also, if you’re relying on a claim to priority to establish that a reference is not prior art, your app may not deserve the claim to priority (i.e., no 112 support in the ancestor). This is not uncommon in CIPs and when claiming priority to a provisionals. In such a case, the court may decline to assume the reference is not prior art, and if so, then find that the reference should have been disclosed. The district court said this in Ring Plus v. Cingular, though this issue wasn’t up on appeal so it wasn’t discussed in the recent Fed. Cir. decision.

    So it may be true that the vast majority of references which are not prior art need not be disclose — but it’s not always true. You need to think through the issues to make the determination.

  45. Final rumination: I find myself agreeing with Newman more and more. Most times she seems spot on in her analysis (Bilski being a possible exception). What does this mean?

  46. Unfortunately, SCOTUS usually only smacks down CAFC bright-line rules when such rules favor patentees (Bilski being the obvious exception). What are the odds SCOTUS will look out for patentees again in my lifetime?

  47. NEW DUTY TO AMEND SPECIFICATION IN REAL-TIME!!

    I’m more interested in what Dennis observed Dyk J. as having said–from the decision:

    “The present-tense representation that the AeroMed system “does not provide comprehensive integration . . . with . . . billing” continued unchanged throughout the pendency of the application.”

    and

    “By not correcting the statement in the specification, applicants continued to maintain its truth in direct contradiction to what is disclosed in the AeroMed brochure.”

    It looks like Dyk J. has conflated the ongoing duty of disclosure during the pendency of the application with a new duty to keep any and all representations made in the spec current.

    Is this now a duty upon us prosecutors, and if so, what are its limits?

    I have always believed that if new material information comes to light that necessitates both submission in an IDS and amendments to the claims in order to preserve patentability, that the spec should also be amended as required.

    But in this case, no amendments to the claims were occasioned by the information. Am I missing something? Has there always been a broad duty to keep representations in the spec absolutely current during prosecution?

  48. This joint infringement (or lack thereof) ruling is ridiculous. The defendants conspired to split up their activities in order to avoid infringement and yet another CAFC bright-line rule yields yet another unfair result. The jury found willful infringement, meaning the defendants knew about the patents and intended to infringe them.

    Goldenhour MUST file for cert in this case. In a rare reversal I find myself hoping SCOTUS will smack down the CAFC for a decidedly anti-patent, bright-line, avoid-any-analysis cop out.

  49. Paul, if you discover an undated reference after filing, and you’re not really sure it is or describes prior art, how do you file it in an IDS? I suppose you could always admit on the PTO record that the reference is prior art, but you might not want to do that either.

    Sure, the MPEP says the examiner has to consider references even if they’re not prior art, but (1) first you need to meet the requirements of the Rules, which include providing the date you don’t have, and (2) what is the examiner considering, exactly, if he doesn’t know the reference is prior art?

  50. I have no problem at all with how Paul describes the situation – but that’s not how the court comes across – the court comes across as a “must” regardless of whether or not the art is prior art – in fact, veritably, the art is not prior art and still must be cited.

  51. Yes, out of context, “[t]here is no requirement that the [submitted] information must be prior art references in order to be considered by the examiner. MPEP § 609 (2008″ is overbroad.

    It would be both clearer and much more reasonable to say that when there is any reasonable doubt as to whether or not the reference was published [or otherwise dated] prior to the subject filing date, OR might be describing prior art existing before the publication date and filing date, that the PTO wants it to be cited for that unresolved issue of whether or not it is prior art to [somehow] be delt with during the patent prosecution.
    [In any case, disclosing a selected part of a reference is asking for trouble.]

  52. Newman gets it right again. You want to promote innovation, then get more Newmans on the Fed. Cir. Don’t ever put someone like Moore on the Fed. Cir. again.

  53. On the materiality issue, this is one of those rare cases where I part company with Judge Newman. The primary reason asserted by the patentee for not citing the brochure to the PTO is that it was undated and the MPEP wouldn’t permit such a citation in an IDS. That’s not convincing, at least to me. That Newman says this brochure isn’t prior art also isn’t convincing on the question of materiality. The Federal Circuit in Bristol Myers Squibb v. Rhone-Poulenc Rorer has already held that after published art (an article authored by the patent applicants wihch contradicted what was stated in the patent) can be “material.”

  54. Yet Another Thread with the “No harm-no foul” mentality.

    Yet the following seems to have been overlooked (and is something I might even agree with Ned about):

    The Federal Circuit rejected that argument because the duty of disclosure is not limited to prior art. As stated in the MPEP, “[t]here is no requirement that the [submitted] information must be prior art references in order to be considered by the examiner.” MPEP § 609 (2008).

    What business does an examiner have in reviewing items that are not prior art? Yeah, I get the weasel words of the IDS which state that the items provided in an IDS may or may not be prior art, but such is not an equivalent to now requiring submissions of what is believed to be non-prior art. If this illogical idiosyncrasy is allowed to propagate, what examiners see now on IDS forms will seem like a few rain drops compared to the coming deluge.

  55. Uh-oh. We may have a problem. After reading the PTO’s brief and their description of Rule 56′s materiality standard, I am now think the PTO’s view of things is consistent with that of the majority here on “misrepresentations.” Any misrepresentation regarding patentability is material regardless of whether the patent may have issued but for the misrepresentation.

    Rule 56, on materiality:

      1) It establishes, by itself or in combination with other information, a prima facie case of unpatentability of a claim; or

      (2) It refutes, or is inconsistent with, a position the applicant takes in:

      (i) Opposing an argument of unpatentability relied on by the Office, or

      (ii) Asserting an argument of patentability.”

    Under subsection two, the “information” is material if it is inconsistent with a statement made by the applicant in support of patentability….” There is no requirement that the information be material in some other way such as by showing that but for the misrepresentation the patent would not have issued. The PTO standard seems to be that any misrepresentation at all should render the patent unenforceable even if there is no harm.

    In the present case, the prior art AeroMed system was either comprehensive or it was not comprehensive. But assume that it was comprehensive and the applicant said that it was not, which appear to be the facts in this case. Now the jury held the patent not invalid over the reference. Thus it would appear that the patent would have issued even if the information about the AeroMed system being comprehensive were disclosed to the patent examiner.

    There may have been a misrepresentation. It may have been innocent. It may not have been innocent. But clearly it was not material and should not have rendered the patent unenforceable.

  56. Inequitable conduct: This case is a classic example of what happens when a document is filed in a partial redacted version omitting critical information, and also when an applicant for a patent continues to make representations which he knows, or should know, are untrue. It is difficult from this distance and from the limited information of the opinion itself to know whether what happened falls into the mistake or slimeball category (or indeed into neither of those categories), but the brochure in question appears to fall in the category which Sherlock Holmes would have defined as a “curious incident”.

    There is, however, a clear issue of materiality. Apparently the brochure was considered at trial and was not invalidating. Under these circumstances how can it have been clearly material? There may have been an attempt to conceal something, but if it turned out not to be relevant, should it matter?

    Why do we not hear of this sort of incident in the UK? Nowadays we do not have issues of discretion (except for infringement damages on an amended partially valid patent), so this kind of issue would not surface. All that would happen is that the complete brochure would be put in evidence, it would be relied on at trial as prior art (if that could be proved) and/or for its factual content (which would need to be elaborated by expert testimony) and a decision as to validity would be made. Are we worse off for not investigating the surrounding circumstances as you do in the US? In my submission, clearly not.

  57. This case illustrates the value in drafting claims from multiple perspectives. It is not clear to me whether it would have been straightforward to draft a method claim that would be infringed by an end-user of the system (eg a medical team dispatch operator). However, if this could be done then there would be a single infringer of such a claim. Admittedly not one that you would wish to sue, but one that could provide the underlying direct infringement as a basis for a contributory or induced infringement claim.

  58. Matthew said: What about induced infringement.

    DDC Says: Contributory Infringement and Inducement both require underlying direct infringement by a single entity.

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