June 2011

Calcar v. Honda: CAFC’s First Post-Therasense Inequitable Conduct Opinion

By Jason Rantanen

American Calcar, Inc. v. American Honda Motor Co., Inc. (Fed. Cir. 2011) Download 09-1503-1567
Panel: Lourie (author), Bryson, and Gajarsa

In its first decision addressing the issue of inequitable conduct since Therasense v. Becton Dickinson, the Federal Circuit affirmed the district court's finding of materiality with respect to one patent, but remanded for further findings on materiality (in connection with the two remaining patents) and intent (with respect to all three patents).

The inequitable conduct issues in this case revolve around a family of patents sharing a common specification.  One of the patents, No. 6,330,497 ("the Three-Status patent"), relates to "a system that allows a user to select an option from a list, to be shown a preview of information about it, and then to activate it."  Slip Op. at 12.  Two other patents, Nos. 6,438,465 and 6,542,795 ("the Search patents") claim a system for performing searches on a system in a vehicle. 

Prior to the filing of the patent application, the inventors closely examined an Acura 96RL that contained a navigation system with features similar to those later claimed in the Three-Status and Search patents.  Although the 96RL system is described in the background section of the patent application, that description is limited to the navigation aspect of the system, not the user interface aspects.  Thus, the inventors "never disclosed to the PTO the aspects of the 96RL system relating to the three-status feature or the search feature."  Slip Op. at 14.This failure to disclose formed the basis of the district court's finding of inequitable conduct, which Calcar sought to overturn on appeal.

Jury Verdict Merely Advisory
In reaching its conclusion of inequitable conduct, the district court disregarded an advisory jury verdict of no inequitable conduct.  The CAFC rejected Calcar's argument that this constituted error.  "Inequitable conduct is equitable in nature, with no right to a jury, and the trial court has the obligation to resolve the underlying facts of materiality and intent…Where a court submits the question to a jury, and both parties agree that the jury findings will be advisory, the court shall treat them as such. [] That is the universal rule."  Slip Op. at 23 (internal citations omitted).

Appliation of Therasense
The CAFC next turned to the substance of the district court's findings.  With respect to the Three-Status patent, the panel concluded that, even under the "but-for" standard of Therasense, the district court had correctly found materiality.  "We agree with Honda that the undisclosed 96RL information was material to the Three-Status patent because the jury found, and the court upheld, the asserted claims as anticipated by the 96RL system, and ACI has not appealed that decision to us."  Slip Op. at 25. 

The materiality of the Search patents was more questionable, given that the jury had rejected Honda's invalidity arguments based on the 96RL system.  Nevertheless, "the withheld information may be material if it would have blocked patent issuance under the PTO's preponderance of the evidence standard, giving those patents' claims their broadest reasonable construction."  Id.  As a result the CAFC remanded to the district court to assess materiality under a "but-for" standard, applying the evidentiary standard and claim scope used by the PTO.  The CAFC did not give any guidance as to how the latter might differ from the scope previously applied by the district court.

The CAFC reached a similar result on intent, concluding that the district court had relied on a sliding scale standard, "basing its finding of intent significantly on the materiality of the 96RL system to the claimed invention."  Slip Op. at 26.  That approach was rejected in Therasense, and the CAFC remanded for further consideration in light of that opinion.

Note: The court also affirmed the district court's rulings of noninfringement as to several other patents and reversed its denial of judgment as a matter of law that another patents was invalid. 

For those who find this information noteworthy, the panel in this case included two members of the dissent in Therasense.  Judge Lourie, the author of this opinion, was a member of the Therasense majority.

Patently-O Bits & Bytes by Lawrence Higgins

Constitutional Challenge to False Marking Statute

  •  Oral arguments in the case of United States, ex rel. FLFMC, LLC v. Wham-O, Inc., will take place on July 7th. The Federal Circuit will be resolving the constitutional challenge to the false marking statute (35 U.S.C. § 292(b)). The merits panel agreed to allow the government and the U.S. Chamber of Commerce to participate in oral arguments. The court expanded the oral argument time to 20 minutes per side. This case could set the precedent to eliminate false marking lawsuits. Regardless of how the Federal Circuit rules in this case, it is likely to be appealed to the Supreme Court. [FMLC-Reply-Brief] [Order-Re-Wham-O-Oral-Arg] [Cato-Brief] [Brief-of-Amicus-Curiae-Chamber-of-Commerce] [USA-Brief-in-Wham-O] [Wham-O-Brief]

Article One launches 3 Patent Studies Focused on 4 Patents on by Lodsys

  •  In response to the lawsuit Lodsys filed against several Apple iPhone developers, [Link] Article One is offering a $5,000 reward per study for the best prior art reference that provides a path to invalidity. The patents at issue are 7,133,834, 5,999,908, [Link] 7,222,078, [Link] and 7,620,565. [Link]To date Lodsys has sued 27 companies for patent infringement, so there is no way of knowing exactly who is funding the study that Article One is overseeing. [Link]

Google Granted Patent for “Detecting and Rejecting Annoying Documents”

  •  On June 28th Google was granted patent # 7,971,137, for a system and method for evaluating documents for approval or rejection and/or rating. The method comprises comparing the document to one or more criteria determining whether the document contains an element that is substantially identical to one or more of a visual element, an audio element or a textual element that is determined to be displeasing.  

What Impact Will Patent Reform Have on the Patent Office?

  •  The Patent Reform legislation will allow the PTO to keep fees they receive from applicants in an account that Congress can’t touch. The PTO will likely start hiring more patent examiners in order to try to decrease the backlog of patent applications, which currently stands at around 685,000. The satellite office in Detroit more likely than not will open sometime in the near future, possibly followed by more satellite offices. Track one of the Three-Track program, which allows applicants to pay extra money to receive a first office action within a certain amount of time will go into effect. Patent Examiners will likely receive more training and be able to resume working overtime.

Patent Jobs:

  • Salix Pharmaceuticals is searching for an IP and Licensing Attorney with at least 3 years of experience in pharmaceutical patent prosecution. [Link]
  • BASF is seeking a Patent Counsel with 8 or more years of experience in IP transaction work and at least 5 years of experience in patent prosecution. [Link]
  • Sutherland LLP is looking for an Associate of Patent Agent with 1-4 years of experience in patent prosecution and a background in Electrical Engineering. [Link]

  • Baker Botts is searching for a Patent Agent with 1-3 years of experience. [Link]

Upcoming Events:

  • The National Association of Patent Practitioners (NAPP) will hold their 2011 Annual Meeting and Nuts & Bolts Short Course at the Venetian Palazzo Hotel in Las Vegas, Nevada on July 16-19, 2011. [Link]
  • The American Conference Institute (ACI) will hold a Hatch-Waxman Boot Camp July 18-19 in San Diego. ACI’s Hatch-Waxman Boot Camp has been designed to give counsel and advisors to brand name and generic drug critical insights into commercialization and the pre-approval process, and also provide an in-depth review of Hatch-Waxman and other IP basics relative to small molecules and biologics. [Link]
  • World Research Group is holding the 8th Annual Patents for Financial Services Summit on July 27-28thin New York. Guest speakers include David Cunningham, Larry Bromberg, Matthew Krigbaum, and Moshe Malina. (Patently-O readers can use Promo Code ENN794 for a $200 discount) [Link]
  • The 2nd European Pharmaceutical Regulatory Law Forum will be held in Brussels, Belgium September 21-22nd. The forum will focus on recent developments affecting the pharma industry in Europe and will discuss the impact of US developments on European companies. (Patently-O readers can register with code PO 10 for a 10% discount) [Link]

 

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

 

 

 

Patently-O Bits & Bytes by Lawrence Higgins

Constitutional Challenge to False Marking Statute

  •  Oral arguments in the case of United States, ex rel. FLFMC, LLC v. Wham-O, Inc., will take place on July 7th. The Federal Circuit will be resolving the constitutional challenge to the false marking statute (35 U.S.C. § 292(b)). The merits panel agreed to allow the government and the U.S. Chamber of Commerce to participate in oral arguments. The court expanded the oral argument time to 20 minutes per side. This case could set the precedent to eliminate false marking lawsuits. Regardless of how the Federal Circuit rules in this case, it is likely to be appealed to the Supreme Court. [FMLC-Reply-Brief] [Order-Re-Wham-O-Oral-Arg] [Cato-Brief] [Brief-of-Amicus-Curiae-Chamber-of-Commerce] [USA-Brief-in-Wham-O] [Wham-O-Brief]

Article One launches 3 Patent Studies Focused on 4 Patents on by Lodsys

  •  In response to the lawsuit Lodsys filed against several Apple iPhone developers, [Link] Article One is offering a $5,000 reward per study for the best prior art reference that provides a path to invalidity. The patents at issue are 7,133,834, 5,999,908, [Link] 7,222,078, [Link] and 7,620,565. [Link]To date Lodsys has sued 27 companies for patent infringement, so there is no way of knowing exactly who is funding the study that Article One is overseeing. [Link]

Google Granted Patent for “Detecting and Rejecting Annoying Documents”

  •  On June 28th Google was granted patent # 7,971,137, for a system and method for evaluating documents for approval or rejection and/or rating. The method comprises comparing the document to one or more criteria determining whether the document contains an element that is substantially identical to one or more of a visual element, an audio element or a textual element that is determined to be displeasing.  

What Impact Will Patent Reform Have on the Patent Office?

  •  The Patent Reform legislation will allow the PTO to keep fees they receive from applicants in an account that Congress can’t touch. The PTO will likely start hiring more patent examiners in order to try to decrease the backlog of patent applications, which currently stands at around 685,000. The satellite office in Detroit more likely than not will open sometime in the near future, possibly followed by more satellite offices. Track one of the Three-Track program, which allows applicants to pay extra money to receive a first office action within a certain amount of time will go into effect. Patent Examiners will likely receive more training and be able to resume working overtime.

Patent Jobs:

  • Salix Pharmaceuticals is searching for an IP and Licensing Attorney with at least 3 years of experience in pharmaceutical patent prosecution. [Link]
  • BASF is seeking a Patent Counsel with 8 or more years of experience in IP transaction work and at least 5 years of experience in patent prosecution. [Link]
  • Sutherland LLP is looking for an Associate of Patent Agent with 1-4 years of experience in patent prosecution and a background in Electrical Engineering. [Link]

  • Baker Botts is searching for a Patent Agent with 1-3 years of experience. [Link]

Upcoming Events:

  • The National Association of Patent Practitioners (NAPP) will hold their 2011 Annual Meeting and Nuts & Bolts Short Course at the Venetian Palazzo Hotel in Las Vegas, Nevada on July 16-19, 2011. [Link]
  • The American Conference Institute (ACI) will hold a Hatch-Waxman Boot Camp July 18-19 in San Diego. ACI’s Hatch-Waxman Boot Camp has been designed to give counsel and advisors to brand name and generic drug critical insights into commercialization and the pre-approval process, and also provide an in-depth review of Hatch-Waxman and other IP basics relative to small molecules and biologics. [Link]
  • World Research Group is holding the 8th Annual Patents for Financial Services Summit on July 27-28thin New York. Guest speakers include David Cunningham, Larry Bromberg, Matthew Krigbaum, and Moshe Malina. (Patently-O readers can use Promo Code ENN794 for a $200 discount) [Link]
  • The 2nd European Pharmaceutical Regulatory Law Forum will be held in Brussels, Belgium September 21-22nd. The forum will focus on recent developments affecting the pharma industry in Europe and will discuss the impact of US developments on European companies. (Patently-O readers can register with code PO 10 for a 10% discount) [Link]

 

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

 

 

 

Patently-O Bits & Bytes by Lawrence Higgins

Constitutional Challenge to False Marking Statute

  •  Oral arguments in the case of United States, ex rel. FLFMC, LLC v. Wham-O, Inc., will take place on July 7th. The Federal Circuit will be resolving the constitutional challenge to the false marking statute (35 U.S.C. § 292(b)). The merits panel agreed to allow the government and the U.S. Chamber of Commerce to participate in oral arguments. The court expanded the oral argument time to 20 minutes per side. This case could set the precedent to eliminate false marking lawsuits. Regardless of how the Federal Circuit rules in this case, it is likely to be appealed to the Supreme Court. [FMLC-Reply-Brief] [Order-Re-Wham-O-Oral-Arg] [Cato-Brief] [Brief-of-Amicus-Curiae-Chamber-of-Commerce] [USA-Brief-in-Wham-O] [Wham-O-Brief]

Article One launches 3 Patent Studies Focused on 4 Patents on by Lodsys

  •  In response to the lawsuit Lodsys filed against several Apple iPhone developers, [Link] Article One is offering a $5,000 reward per study for the best prior art reference that provides a path to invalidity. The patents at issue are 7,133,834, 5,999,908, [Link] 7,222,078, [Link] and 7,620,565. [Link]To date Lodsys has sued 27 companies for patent infringement, so there is no way of knowing exactly who is funding the study that Article One is overseeing. [Link]

Google Granted Patent for “Detecting and Rejecting Annoying Documents”

  •  On June 28th Google was granted patent # 7,971,137, for a system and method for evaluating documents for approval or rejection and/or rating. The method comprises comparing the document to one or more criteria determining whether the document contains an element that is substantially identical to one or more of a visual element, an audio element or a textual element that is determined to be displeasing.  

What Impact Will Patent Reform Have on the Patent Office?

  •  The Patent Reform legislation will allow the PTO to keep fees they receive from applicants in an account that Congress can’t touch. The PTO will likely start hiring more patent examiners in order to try to decrease the backlog of patent applications, which currently stands at around 685,000. The satellite office in Detroit more likely than not will open sometime in the near future, possibly followed by more satellite offices. Track one of the Three-Track program, which allows applicants to pay extra money to receive a first office action within a certain amount of time will go into effect. Patent Examiners will likely receive more training and be able to resume working overtime.

Patent Jobs:

  • Salix Pharmaceuticals is searching for an IP and Licensing Attorney with at least 3 years of experience in pharmaceutical patent prosecution. [Link]
  • BASF is seeking a Patent Counsel with 8 or more years of experience in IP transaction work and at least 5 years of experience in patent prosecution. [Link]
  • Sutherland LLP is looking for an Associate of Patent Agent with 1-4 years of experience in patent prosecution and a background in Electrical Engineering. [Link]

  • Baker Botts is searching for a Patent Agent with 1-3 years of experience. [Link]

Upcoming Events:

  • The National Association of Patent Practitioners (NAPP) will hold their 2011 Annual Meeting and Nuts & Bolts Short Course at the Venetian Palazzo Hotel in Las Vegas, Nevada on July 16-19, 2011. [Link]
  • The American Conference Institute (ACI) will hold a Hatch-Waxman Boot Camp July 18-19 in San Diego. ACI’s Hatch-Waxman Boot Camp has been designed to give counsel and advisors to brand name and generic drug critical insights into commercialization and the pre-approval process, and also provide an in-depth review of Hatch-Waxman and other IP basics relative to small molecules and biologics. [Link]
  • World Research Group is holding the 8th Annual Patents for Financial Services Summit on July 27-28thin New York. Guest speakers include David Cunningham, Larry Bromberg, Matthew Krigbaum, and Moshe Malina. (Patently-O readers can use Promo Code ENN794 for a $200 discount) [Link]
  • The 2nd European Pharmaceutical Regulatory Law Forum will be held in Brussels, Belgium September 21-22nd. The forum will focus on recent developments affecting the pharma industry in Europe and will discuss the impact of US developments on European companies. (Patently-O readers can register with code PO 10 for a 10% discount) [Link]

 

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

 

 

 

Patently-O Bits & Bytes by Lawrence Higgins

Should anyone really be allowed to request Reexamination?

  •  Since 1981, there has been over 11,000 ex parte reexam request submitted to the PTO. As you would guess the majority (66%) being filed by a 3rd party and 33% being filed by the actual patent owner. In 1982 there were only 187 reexam request compared to 780 in 2010, this is over a 300% increase in request. Also, reexam certificate results show that the actual claim changed 66% of the time. Out of the total request for reexam, only 8% of the requests were denied. This leads me back to my question; should the PTO allow anyone from the general public to request a reexam? I would argue no, essentially because a single individual or company could in theory request a reexam for any and every patent.  [USPTO Ex Parte Reexam Statistics]

Will Apple Sue?

  •  On June 21st Apple was granted patent # 7,966,578 for a “Portable multifunction device, method, and graphical user interface for translating displayed content” essentially a touchscreen device such as the IPad or IPhone. Apple could potentially use patent “578” to force their competitors to either, stop manufacturing infringing products or pay licensing fees. This patent is extremely broad and could cover a lot of items currently on the market such as smartphones, e-readers, and tablets to name several. One of Apple’s competitors will surely request a reexam on this patent and patent “578” is more than likely to end up in litigation. [Link]

USPTO Appoints New Deputy Commissioner for Trademark Operations

  •  Mary Boney Denison has been appointed the new Deputy Commissioner for Trademark Operations. Denison will oversee the examination and processing of applications in the trademark division of the USPTO. [Link]

Patent Jobs:

  • Baker & Daniels is looking for an IP associate with up to 5 years of experience prosecuting patents, to work at their Fort Wayne, Indiana office. [Link]
  • Amgen is looking for an individual with 4 or more years of experience in patent or IP law to join their company as Senior Counsel. [Link]
  • Monsanto is seeking a patent scientist with a MS degree or higher and 2+ year’s research experience. [Link]
  • The Marbury Law Group is seeking an IP associate with 2-8 years patent experience and a telecommunications background, to work at their Reston, Virginia office. [Link]

Upcoming Events:

  • The National Association of Patent Practitioners (NAPP) will hold their 2011 Annual Meeting and Nuts & Bolts Short Course at the Venetian Palazzo Hotel in Las Vegas, Nevada on July 16-19, 2011. [Link]
  • The American Conference Institute (ACI) will hold a Hatch-Waxman Boot Camp July 18-19 in San Diego. ACI’s Hatch-Waxman Boot Camp has been designed to give counsel and advisors to brand name and generic drug critical insights into commercialization and the pre-approval process, and also provide an in-depth review of Hatch-Waxman and other IP basics relative to small molecules and biologics. [Link]
  • World Research Group is holding the 8th Annual Patents for Financial Services Summit on July 27-28th in New York. Guest speakers include David Cunningham, Larry Bromberg, Matthew Krigbaum, and Moshe Malina. (Patently-O readers can use Promo Code ENN794 for a $200 discount) [Link]

 

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

 

 

 

 

Patently-O Bits & Bytes by Lawrence Higgins

Should anyone really be allowed to request Reexamination?

  •  Since 1981, there has been over 11,000 ex parte reexam request submitted to the PTO. As you would guess the majority (66%) being filed by a 3rd party and 33% being filed by the actual patent owner. In 1982 there were only 187 reexam request compared to 780 in 2010, this is over a 300% increase in request. Also, reexam certificate results show that the actual claim changed 66% of the time. Out of the total request for reexam, only 8% of the requests were denied. This leads me back to my question; should the PTO allow anyone from the general public to request a reexam? I would argue no, essentially because a single individual or company could in theory request a reexam for any and every patent.  [USPTO Ex Parte Reexam Statistics]

Will Apple Sue?

  •  On June 21st Apple was granted patent # 7,966,578 for a “Portable multifunction device, method, and graphical user interface for translating displayed content” essentially a touchscreen device such as the IPad or IPhone. Apple could potentially use patent “578” to force their competitors to either, stop manufacturing infringing products or pay licensing fees. This patent is extremely broad and could cover a lot of items currently on the market such as smartphones, e-readers, and tablets to name several. One of Apple’s competitors will surely request a reexam on this patent and patent “578” is more than likely to end up in litigation. [Link]

USPTO Appoints New Deputy Commissioner for Trademark Operations

  •  Mary Boney Denison has been appointed the new Deputy Commissioner for Trademark Operations. Denison will oversee the examination and processing of applications in the trademark division of the USPTO. [Link]

Patent Jobs:

  • Baker & Daniels is looking for an IP associate with up to 5 years of experience prosecuting patents, to work at their Fort Wayne, Indiana office. [Link]
  • Amgen is looking for an individual with 4 or more years of experience in patent or IP law to join their company as Senior Counsel. [Link]
  • Monsanto is seeking a patent scientist with a MS degree or higher and 2+ year’s research experience. [Link]
  • The Marbury Law Group is seeking an IP associate with 2-8 years patent experience and a telecommunications background, to work at their Reston, Virginia office. [Link]

Upcoming Events:

  • The National Association of Patent Practitioners (NAPP) will hold their 2011 Annual Meeting and Nuts & Bolts Short Course at the Venetian Palazzo Hotel in Las Vegas, Nevada on July 16-19, 2011. [Link]
  • The American Conference Institute (ACI) will hold a Hatch-Waxman Boot Camp July 18-19 in San Diego. ACI’s Hatch-Waxman Boot Camp has been designed to give counsel and advisors to brand name and generic drug critical insights into commercialization and the pre-approval process, and also provide an in-depth review of Hatch-Waxman and other IP basics relative to small molecules and biologics. [Link]
  • World Research Group is holding the 8th Annual Patents for Financial Services Summit on July 27-28th in New York. Guest speakers include David Cunningham, Larry Bromberg, Matthew Krigbaum, and Moshe Malina. (Patently-O readers can use Promo Code ENN794 for a $200 discount) [Link]

 

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

 

 

 

 

Patently-O Bits & Bytes by Lawrence Higgins

Should anyone really be allowed to request Reexamination?

  •  Since 1981, there has been over 11,000 ex parte reexam request submitted to the PTO. As you would guess the majority (66%) being filed by a 3rd party and 33% being filed by the actual patent owner. In 1982 there were only 187 reexam request compared to 780 in 2010, this is over a 300% increase in request. Also, reexam certificate results show that the actual claim changed 66% of the time. Out of the total request for reexam, only 8% of the requests were denied. This leads me back to my question; should the PTO allow anyone from the general public to request a reexam? I would argue no, essentially because a single individual or company could in theory request a reexam for any and every patent.  [USPTO Ex Parte Reexam Statistics]

Will Apple Sue?

  •  On June 21st Apple was granted patent # 7,966,578 for a “Portable multifunction device, method, and graphical user interface for translating displayed content” essentially a touchscreen device such as the IPad or IPhone. Apple could potentially use patent “578” to force their competitors to either, stop manufacturing infringing products or pay licensing fees. This patent is extremely broad and could cover a lot of items currently on the market such as smartphones, e-readers, and tablets to name several. One of Apple’s competitors will surely request a reexam on this patent and patent “578” is more than likely to end up in litigation. [Link]

USPTO Appoints New Deputy Commissioner for Trademark Operations

  •  Mary Boney Denison has been appointed the new Deputy Commissioner for Trademark Operations. Denison will oversee the examination and processing of applications in the trademark division of the USPTO. [Link]

Patent Jobs:

  • Baker & Daniels is looking for an IP associate with up to 5 years of experience prosecuting patents, to work at their Fort Wayne, Indiana office. [Link]
  • Amgen is looking for an individual with 4 or more years of experience in patent or IP law to join their company as Senior Counsel. [Link]
  • Monsanto is seeking a patent scientist with a MS degree or higher and 2+ year’s research experience. [Link]
  • The Marbury Law Group is seeking an IP associate with 2-8 years patent experience and a telecommunications background, to work at their Reston, Virginia office. [Link]

Upcoming Events:

  • The National Association of Patent Practitioners (NAPP) will hold their 2011 Annual Meeting and Nuts & Bolts Short Course at the Venetian Palazzo Hotel in Las Vegas, Nevada on July 16-19, 2011. [Link]
  • The American Conference Institute (ACI) will hold a Hatch-Waxman Boot Camp July 18-19 in San Diego. ACI’s Hatch-Waxman Boot Camp has been designed to give counsel and advisors to brand name and generic drug critical insights into commercialization and the pre-approval process, and also provide an in-depth review of Hatch-Waxman and other IP basics relative to small molecules and biologics. [Link]
  • World Research Group is holding the 8th Annual Patents for Financial Services Summit on July 27-28th in New York. Guest speakers include David Cunningham, Larry Bromberg, Matthew Krigbaum, and Moshe Malina. (Patently-O readers can use Promo Code ENN794 for a $200 discount) [Link]

 

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

 

 

 

 

Universities & Micro Entities to Receive 75% reduction in Patent Office Fees

One new provision in the new patent act that will be welcomed by a number of patent applicants is the new “micro entity” fee structure. “Small entities” already receive a 50% discount on most patent office fees. Those fees will be reduced by another 50% for qualifying micro entities — a total of 75% discount as compared with the large entity fee.

A new provision (35 U.S.C. 123) defines the term “micro entity” as the patent applicant (inventor):

  1. Qualifies as a small entity;
  2. Has not been named as an inventor on more than 4 previously filed US non-provisional patent applications (not including inventions assigned based upon prior employment);
  3. Does not have an income of more than 3x the median US household income ($50k for 2009); and
  4. Has not conveyed or contractually promised to convey rights or to an entity that has an income of more than 3x the median US household income.

In a major subsidy to universities, the House Bill (H.R. 1249) grants the 75% fee reduction to public and non-profit universities and other “institutes of higher education.”  The Senate Bill (S. 23) only grants the 75% reduction to State public institutions of higher education.  The parties will look to work out the details in conference. To become law, the identical bill must be passed in both houses.

The statute also provides that the USPTO Director can set additional limits to restrict the impact of the micro entity status. These may include, for instance, additional income and annual filing limits.

Supreme Court takes Two More Patent Cases

The Supreme Court has granted writs of certiorari in two pending patent cases. 

In Kappos v. Hyatt, the Supreme Court will decide (1) whether a patent applicant who files a Section 145 civil action has a right to present new evidence to the Federal District Court that could have been (but was not) presented during the proceedings before the USPTO and (2) when new evidence is presented, whether the court may decide the related factual questions de novo and without deference to prior PTO findings.  An en banc Federal Circuit previously sided with the applicant, Hyatt, and held that the district court must allow new evidence and that factual conclusions affected by the new evidence must be decided de novo even if previously determined by the PTO. Judge Kimberly Moore penned the en banc opinion after dissenting from the original panel that had arrived at the opposite conclusion. This is Hyatt’s second case at the Supreme Court.  He won the first against the State of California who was attempting to tax his receipts from patent licensing awards.  Hyatt’s patents are related to computer micro-controller designs and claim a 1975 priority date.

Caraco Pharmaceutical Laboratories, Ltd. v. Novo Nordisk A/S is a brand versus generic pharmaceutical dispute involving the scope of a generic company’s right to counterclaim against the brand based upon a brand’s overbroad description of claim scope submitted to the FDA.  The Federal Circuit held that the Hatch-Waxman Act only allows for deleting of improperly listed patents while the petitioner here argues that the Act also allows for correction of misstatements for patent scope.

The Supreme Court today also decided two personal jurisdiction  that could have some impact on how foreign entities are treated in US patent cases. In  J. McIntyre Machinery v. Nicastro, the court held that a the “stream of commerce” theory of personal jurisdiction was being taken too far and that the foreign manufacturer (Nicastro) could not be subject to courts located in New Jersey because it had not engaged in activities in that state that “revealed an intent to involde or benefit from the protection of the [New Jersey] laws.”  In Goodyear Luxembourg Tires v. Brown, the court held that courts located in North Carolina did not have general jurisdiction over Goodyear’s foreign subsidiary.

Patent Reform Passes

H.R. 1249, the Leahy-Smith America Invents Act, passed the House today with broad bipartisan support. The Senate passed its version of the bill (S. 23) on March 8th by a vote of 95 to 5.

The House and Senate will now conference to attempt to work out differences between the bills and then a final vote on a compromise bill will have to take place (likely in the Senate). The final version will include a first-to-file regime but will not likely provide the USPTO with any guarantee of full funding.  

The litigation involving the interpretation of the many new provisions of the Bill will occupy Patently-O posts for at least the next decade.

The Big Government Patent Bill: Guest Essay By John Duffy

Posted by Jason Rantanen

There are many sophisticated and nuanced reasons to oppose H.R. 1249, the 140-page patent bill currently pending before the House of Representatives, but the clearest reason for opposition can be stated in quite simple and stark terms: The proposed legislation would undeniably expand the size of the federal bureaucracy and increase the cost and complexity of the American patent system.

Thus begins a new and timely essay about the patent reform bill written by Professor John Duffy of George Washington University Law School, in which he focuses on three fundamental issues raised by H.R. 1249 that should concern any publicly-minded citizen.  The complete essay can be downloaded here: Download The Big Government Patent Bill

Tyco v. Mutual Pharmaceutical: Obviousness of a Pharmaceutical Formulation

By Jason Rantanen

Tyco Healthcare Group LP v. Mutual Pharmaceutical Company, Inc. (Fed. Cir. 2011) Download 10-1513
Panel: Newman, Bryson (author), Gajarsa

Pharmaceutical formulation patents often make for challenging obviousness determinations, as the difficulty of reducing a new formulation to practice is balanced against the prior art, which typically includes the relevant pharmaceutical compound itself.  The formulation in this case, however, raised few such concerns for the Federal Circuit.

A pharmaceutical formulation is a particular form, such as a tablet or suspension, into which a chemical compound (often referred to as an Active Pharmaceutical Ingredient, or API) is placed in order to be easily administered to patients.  Pharmaceutical formulations may vary in a number of ways, such as in their effect (for example, an extended release formulation may prolong the release period of the API) or their dosage (5, 10, or 15 mg of the API, for example).

Patent No. 9,211,954 provides an example of the latter.  It claims a formulation of the API temazepam, a drug used for the treatment of insomnia. The patent claims priority to September 1986.

The obviousness issue in this case revolved around whether the formulation claimed by the '954 patent, which incorporates a 6-8 mg dosage unit of temazapam, was obvious in light of Tyco's prior 15 and 30 mg formulations of temazepam in light of a 1983 edition of the British National Forumulary reference.  Formulations of temazepam have been marketed since the 1970's, including Tyco's own RESTORIL. It was undisputed that the only difference between the earlier formulations of RESTORIL and the claimed formulation was the dosage (Tyco's earlier formulations contained 15 and 30 mg doses).  The district court granted summary judgment of obviousness based on Tyco's earlier RESTORIL product, together with the BNF dosing guidelines for temazepam.

On appeal, the Federal Circuit affirmed the obviousness ruling.  The most interesting aspect of the opinion is the section addressing Tyco's argument that the BNF reference – which recommended a 5-15 mg dosage for elderly patients – did not teach the 6-8 mg range of the '954 patent because it did not include or cite any evidence demonstrating that this range would be effective in the treatment of insomnia.  The CAFC rejected this argument:

The ’954 claims do not discuss the intended use of the capsules in a particular treatment regimen. The manufacture of a 7.5 mg temazepam capsule with the disclosed claim limitations would infringe both claims of the ’954 patent, irrespective of the efficacy of the product. Dr. Orr’s statements did not contest the fact that the BNF refers to dosages of temazepam between 5 and 15 mg. His statements are directed to the utility of temazepam as a treatment for insomnia.

Tyco argues that all the properties of a composition of matter relevant to patentability must be considered in evaluating whether that composition would have been obvious in light of the prior art, and that the unclaimed property of effectiveness in treating insomnia renders the claims at issue nonobvious. That argument is unavailing. “The discovery of a new property or use of a previously known composition, even when that property and use are unobvious from the prior art, can not impart patentability to the known composition.” In re Spada, 911 F.2d 705, 708 (Fed. Cir. 1990) (noting that “a new use of a known composition . . . may be patentable as a process”). The recommendation in the BNF of a range of temazepam dosages that include the dosages claimed in the ’954 patent renders obvious the claims to those dosages even in the absence of documentation in the BNF of the effectiveness of such dosages.

Slip Op. at 7-8.  The CAFC also rejected Tyco's arguments of teaching away, unexpected results, and commercial success.

Therasense: Further Impressions

By Jason Rantanen

Two weeks ago, I posted a link to a short essay, written by Lee Petherbridge and myself, about the potential impact of Therasense on the patent system.  We have since received an overwhelming number of thoughtful and clearly informed comments, for which we are extremely grateful.  Attached is a link to an updated draft that incorporates many of the points raised by the comments.  

The most compelling point raised by the comments was a need for a specific section analyzing the impact of Therasense on patent practitioners.  In this updated draft, we provide that specific section.

It begins on page 20, and includes among other things an analysis of the impact of Therasense on the concern about IDS overdisclosure that featured so prominently in the opinion and in the comments we received.  The latest version can be downloaded here: Therasense – First Impression.

As with the prior version, we welcome any comments, either positive or negative.

Supreme Court to Revisit Patentable Subject Matter Eligibility

Mayo Collaborative Services v. Prometheus Laboratories, Inc. (Supreme Court 2011)

by Dennis Crouch

The Supreme Court has agreed to hear Mayo’s petition on the patentable subject matter eligibility of medical diagnostic methods.  The issue raised on appeal is stated as follows: 

Whether 35 U.S.C. § 101 is satisfied by a patent claim that covers observed correlations between blood test results and patient health, so that the claim effectively preempts all uses of the naturally occurring correlations, simply because well-known methods used to administer prescription drugs and test blood may involve “transformations” of body chemistry.

The claims asserted by Prometheus are directed toward a method of “optimizing therapeutic efficacy” by first administering an active drug (6-thioguanine) to a subject and then using the subject’s metabolite blood-level to adjust future doses of the drug.  (U.S. Patents 6,355,623 and 6,680,302). Thus, most of the claims are centered around three ordered-steps of:

  1. administering the drug to the subject;
  2. determining the amount of drug in the subject’s blood; and
  3. re-calibrating the drug dosage based on step-2.

A broader claim (claim 46 of the ‘632 patent) eliminates the administering step of claim 1 above.

The district court found the claims invalid as lacking patentable subject matter under 35 U.S.C. 101.  On appeal, the Federal Circuit reversed — holding that the steps of “administering a drug” and “determining the level of 6-thioguanine” were both sufficiently transformative of “a particular article into a different state or thing.”  That Federal Circut decision was based on the court’s machine-or-transformation test that was subsequently discredited by the Supreme Court in Bilski v. Kappos (2010).  In the wake of its Bilski decision, the Supreme Court vacated the Federal Circuit’s Prometheus decision and remanded for a new opinion.  On remand, the Federal Circuit again affirmed that the Prometheus claims are eligilble for patent protection. [See Rantanan's post]

Obviousness Decisions at the BPAI

Everyone understands that KSR v. Teleflex changed the way that obviousness is treated at the US Patent Office. In that case, the Supreme Court encouraged examiners to rely upon common sense when determining whether a claimed invention is obvious and also eliminated some of the rules against combining various elements of the prior art to into a composite that renders the claimed invention obvious.

I wanted to take a look at how the BPAI is using the KSR decision in its obviousness cases. Using my set of 10,000 recent ex parte BPAI decisions (2009–2011), I looked at the set of decisions involving the question of obviousness and compared the decisions that cited KSR with those that did not cite the case. The results are not surprising. Decisions that cite to KSR are much more likely to affirm examiner rejections as compared with those that do not cite KSR. Namely, in obviousness cases that cite KSR, the examiner rejections are reversed only 15% of cases. In obviousness cases that do not cite KSR, the examiner rejections are reversed in 39% of cases.

 

Appeal Outcome 

 

Affirmed 

Affirmed in Part 

Reversed 

KSR Cite 

67% 

18% 

15% 

No KSR Cite 

47% 

13% 

39% 

The 10,000 case sample size makes these results easily statistically significant.

My take is that the BPAI is not selectively citing KSR but rather that applicants are less likely to win obviousness issues that relate to KSR issues. Thus, in Ex parte Ramchandani the BPAI cited KSR in rejecting the applicant’s argument “that the Examiner has not established a proper motivation to combine” the two cited references. And, in Ex parte Pickering the BPAI felt no need to cite KSR as it agreed with the applicant that the sintered silicon carbide found in the prior art was different from Pickering’s claimed chemical vapor deposited silicon carbide.

 

BPAI Judicial Diversity and Appeal Win Rate

I recently created a database of 10,000 recently released ex parte decisions by the Board of Patent Appeals and Interferences (BPAI) with dates ranging from November 2009 to June 2011. These ex pare BPAI decisions are easy to work with because they always involve a patent applicant appealing an examiner’s rejection of one or more claims. As I discussed in previous work, vast majority of ex parte BPAI decisions involve questions of obviousness and the remainder most often involve anticipation.

General Results: Of BPAI opinions in my sample decided on the merits, about 52% fully affirmed the examiner rejections, 34% reversed, and 14% affirmed-in-part. (About 8% of the decisions were not included in this study because they involved other outcomes such as remands and decisions on motions for rehearing). 

Judicial Diversity: These averages hide what appears to be major differences within the ranks of BPAI Administrative Patent Judges.  To reach this conclusion, I identified the judge that authored each opinion as well as the other judges associated with the decision.  For the 76 most active judges, I then calculated for each judge the percentage of cases where he or she at least partially sided with the patent applicant — i.e., either reversed or affirmed-in-part.  The chart below shows a histogram of the outcomes — showing that there is a wide diversity in expected outcomes depending upon the judges on the panel.

PatentLawImage136

At the low end, about 14 of the 76 judges at least partially side with the patent applicant in less than 40% of cases. At the high end, 10 of the 76 judges at least partially side with the patent applicant in more than 60% of cases.

The statistics here are fairly powerful because each judge in the sample is involved with at least 100 decisions and the median judge was involved with 370 decisions.  Thus, based upon our sample size we can easily reject the null hypothesis that the judges all have the same likelihood of at least partially siding with the patent applicant. And, while there are some differences between appeals arising from the various technology centers, those differences do not explain the judicial diversity shown above.  An additional potential confounding factor is the fact that the assignment of judges is not entirely random — however, in these ex parte cases judges appear to be chosen based on technical expertise rather than the likelihood that the patentee should win.

BPAI Backlog: As an important aside, the BPAI’s backlog of pending appeals continues to grow. Thus far in FY2011, the backlog has grown more than 25% and now rests at over 22,000 pending appeals.

Inventio v. ThyssenKrupp: Functional Claiming

By Jason Rantanen

Inventio AG v. ThyssenKrupp Elevator Americas Corporation (Fed. Cir. 2011) Download 10-1525
Panel: Lourie (author), Prost, Moore

Patent claims may be indefinite due to their use of functional language untethered to any structure.  Prevailing on such an argument, however, can be quite difficult, as Inventio v. ThyssenKrupp illustrates.

The patents in this case relate to a device that allows elevator passengers to enter their floor destination as they call for the elevator.  Central to the claimed invention are two components: a "computing unit," which processes the passenger's input, and a "modernizing device," which acts as an intermediary between the computing unit and the elevator control.  During claim construction, the district court concluded that both claim terms "lacked sufficient structure to avoid § 112 ¶ 6," slip op. at 7, further holding that they were indefinite because the written description failed to disclose corresponding structure to perform the recited functions.  Inventio appealed.

Strong Presumption Against Means Plus Function Construction
Patentees are permitted to include purely functional language in their claims under § 112 ¶ 6.  Under that provision, such limitations "shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof."  Slip Op. at 9.  Whether § 112 ¶ 6 applies depends principally on whether the limitation uses the term "means."  When that term is not used, "we presume that the limitation does not invoke § 112 ¶ 6."  Id.  The presumption "is a strong one that is not readily overcome."  Id. at 10.

Presumption Not Overcome
Given the absence of the term "means" in the disputed limitations, the court focused its analysis on whether ThyssenKrupp had overcome the "strong presumption" against application of § 112 ¶ 6, concluding that it had not.  In reaching this conclusion, the court agreed with Inventio that it should consider the written description in determining whether the claims recite sufficient structure. "[I]t is proper to consult the intrinsic record, including the written description, when determining if a challenger has rebutted the presumption that a claim lacking the term "means" recites sufficiently definite structure."  Slip Op. at 12.  Applying this rule, the court found that the terms "modernizing device" and "computing unit" provided, at least in the context of the two patents at issue, sufficient structure:

"In this case [] the claims recite a “modernizing device,” delineate the components that the modernizing device is connected to, describe how the modernizing device interacts with those components, and describe the processing that the modern-izing device performs. The written descriptions addition-ally show that the modernizing device conveys structure to skilled artisans. Thus, this is not a case where a claim nakedly recites a “device” and the written description fails to place clear structural limitations on the “device.”"

Slip Op. at 15.  The CAFC applied similar reasoning to "computing unit."

Is The Court Effectively Applying a Presumption Against Indefiniteness of Functional Claim Elements?
Under Supreme Court precedent, a claim may be invalid for indefiniteness if it contains functional claim limitations.  See General Electric Co. v. Wabash Appliance Corporation, 304 U.S. 364, 371 (1938); United Carbon Co. v. Binney & Smith Co., 317 U.S. 228, 234 (1942); c.f. Halliburton Energy Services, Inc. v. M-I LLC, 514 F.3d 1244, 1255 (Fed. Cir. 2008). Section 112 ¶ 6 provides the exception discussed above.

I question how viable this aspect of the indefiniteness doctrine is in practice, however, at least under the Federal Circuit's current approach.  Under cases such as Inventio, the CAFC's framework for analyzing indefiniteness based on functional claiming operates like this: (Question One) Is this a means-plus-function claim element?  If No, then it is not indefinite.  If Yes, (Step Two) Does the written description recite sufficient structure? If No, the claim is indefinite; if Yes, it is not.  Since there is a strong presumption in favor of answering "No" to Question One unless the term "means" is used, the effective result is a strong presumption against indefiniteness unless the patent drafter elects otherwise.   This makes it extremely difficult for a party challenging the definiteness of a functional claim element to prevail, and seems somewhat inconsistent with the broader ideas of General Electric and United Carbon.

I could see the CAFC's rule as perhaps being justified on the ground that patents are entitled to a presumption of validity, and the indefiniteness issue is, after all, one type of validity analysis.  But that does not appear to be how the court has justified its rule thus far.  Instead, it has treated it solely as a claim construction question in which deference is given to the patent drafter's choice of language. 

ThyssenKrupp's Motion to Strike
Following the completion of merits briefing, ThyssenKrupp filed a motion to strike portions of Inventio's reply brief on various grounds, including that it contained new and misleading arguments about the disclosure of the '861 and '465 patents.  Unimpressed by ThyssenKrupp's motion, the court rejected it.  "ThyssenKrupp simply disagrees with Inventio's legal arguments, and its motion seems to us to be an improper attempt to obtain the final word in the appeal, a practice that we strongly discourage."  Slip Op. at 3.  FIling such a motion, the court commented, "borders on the type of frivolous and wasteful litigation tactics that we have previously frowned upon."  Id.

Update: For those interested in reading the offending brief, a copy can be downloaded here:  Download SchmitMotionToStrike.  Thanks to Hal Wegner for circulating a copy in his email newsletter. 

Identifying the Invention as part of the Claims

by Dennis Crouch

PatentLawImage135

I see the above chart is indicative of patent applicants’ shift away from filing patent applications that particularly identify the inventive features of the inventions being patented.  “Whereby” clauses have traditionally been used in patent claims as a mechanism of particularly identifying the new result of the claimed invention. In his guide for inventors, David Pressman recommends “adding a ‘whereby’ clause to specify the advantage or use of the invention to hammer home to the examiner, or anyone else who reads your claims, the value of your invention.”  Patent It Yourself (2009).  

As the chart shows, whereby clauses have fallen out of fashion.  I attribute the reduced reliance on the whereby clauses as largely driven by a perception that whereby clauses do not narrow the claim scope during prosecution but may well be limiting during a later infringement analysis.  Even if not limiting, a whereby clause may also cause a patentee to lose face before a jury if the cited advantage turns out to not exist or already be well known in the prior art.  

In Hal Milton’s recent article, he focuses more on the identification and disclosure of the new result and not on particularly claiming the new result.  This particular statistic that I have identified here does not pick up whether applicants are identifying the new result within the specification (outside of the claims).

Note: I created the chart above by counting the number of patents that included the word “whereby” within the claims and then divided that sum by the total number of utility patents issued during the relevant time period.

A Modest Proposal?: Identifying the Invention within the Patent Application

Well known patent attorney Hal Milton recently published a new article in John Marshall’s Review of Intellectual Property Law (RIPL) that argues for the presentation of a “new result” within every patent application.  The majority of newly drafted patent applications do not follow Milton’s approach and instead seem to obscure the innovative elements of the claimed invention and fail to identify the problem being solved by the invention.  Milton writes:

Fifty years of examining, drafting, and prosecuting patents, including the patent at issue in KSR International Co. v. Teleflex, Inc., coupled with the KSR opinion and the lessons therefrom, led the author herein to the objective standard of a new result.  Inventors should be counseled that a new result should be sought out to justify the exclusive right of a patent.

Milton’s approach builds upon Paul Cole’s 2008 post-KSR article also published in RIPL. In that article, Cole reiterated that that evidence showing a new result is “necessary” under the European Patent Convention (EPC).

Milton’s approach also complements Ron Slusky’s approach to claim drafting that focuses a claim drafter’s attention first on the problem being solved by the invention. A major difference, however, is that Slusky does not explicitly advocate identifying the new result as part of the application itself.

Milton again:

In addition to identifying the new result or function to justify the exclusive right
of a patent, … that new result [should be] systematically recited throughout all sections of a patent application.  Because a court may interpret a patent based upon the intrinsic patent alone, without regard to extrinsic evidence presented in advocacy outside the patent document, extreme care should be exercised in preparing the original patent application with consistency throughout.  It is important to realize that patent offices, for the most part, grant patents based upon claims whereas the courts enforce patents based upon the entire patent.

Intellectual Property Watch

For those of you who care about following international issues in intellectual property law, the not-for-profit Intellectual Property Watch (IP Watch) offers accurate and current, high level reporting most often written by its Director William New.   Although Mr. New has been stationed in Geneva for a number of years, he a trained American journalist and writes extremely well.  My only problem with IP Watch over the years has been the high cost of subscriptions.

In any event, IP Watch is urgently looking for a few donors over the next couple of weeks to help it continue its mission.