August 2011

Patently-O Bits & Bytes by Lawrence Higgins

Is the color red functional for shoe outsoles?

  • Judge Victor Marrero recently decided the famous Louboutin red outsole trademark case and decided that the color red is functional for shoe soles. Lanham 2(e) (5) states that "no trademark…shall be refused registration…unless it– comprises any matter that, as a whole, is functional." This was a difficult case to decide, counsel for both sides made great arguments. I think the Judge had a difficult job, and basically looked at the impact the case would have on trademark law and the market. Judge Marrero stated "if Louboutin owns Chinese Red for the outsole of that another designer high fashion women's shoes, another designer can just as well stake out a claim for exclusive use of another shade of red or even Louboutin's color, for the insole…" Judge Marrero seems to think that the flood gates would open and individuals would want to trademark a color for all types and aspects of shoes. In theory Judge Marrero is 100% correct, however, I am not sure if I agree with Judge Marrero since the trademark was granted in 2008 and I have not seen any other shoe maker using colored outsoles. I am sure Louboutin will appeal the decision to cancel the red outsole trademark if the decision is finalized on August 17, 2011. [Opinion]

Mark Cuban—My Suggestion on Patent Law

  • Mark Cuban is the outspoken owner of the NBA champion Dallas Mavericks and he wanted to express his view of the patent system. Mark suggests that the solution to the patent system is to end all software patents and all process patents. He believes that software has enough protection because it is copyrightable and process patents have no purpose at all. Some benefits of eliminating process and software patents that Mark proposes are: reducing court room costs, improving the efficiency of the Patent Office, ending the current patent arms race, and creating jobs. [Link]

Will Gene Patents Impede Whole Genome Sequencing?

  • Professor Chris Holman of UMKC law school and Holman's Biotech IP Blog is in the process of finalizing an article entitled "Will Gene Patents Impede Whole Genome Sequencing?: Deconstructing the Myth That 20% of the Human Genome Is Patented". In the article Professor Holman points out that many people believe that over 20% of the genome is patented and that these patents preclude researchers from studying or even looking at the patented genes. However, Holman calls this a misperception and there is no reason to believe that 20% of human genes are off-limits. Holman states that a vast majority of human gene patents were drafted in a manner that would not encompass whole genome sequencing. [Link]

Patent Jobs:

  • Gifford, Krass, Anderson, Sprinkle & Citkowski is seeking a partner for its Ann Arbor, MI office. [Link]
  • Morris & Kamlay is seeking a patent attorney with a technology/science background to work in their Washington, D.C. office. [Link]
  • Rutan & Tucker is searching for 2 patent agents with 2-4 years of experience and a science background. [Link]
  • The American Intellectual Property Law Association (AIPLA) is seeking an individual to fill its Deputy Executive Director -International & Regulatory position. [Link]
  • Kraft Foods is searching for a patent attorney with a minimum 5 years of experience. [Link]
  • Los Alamos National Security is seeking a patent attorney with a minimum of 8 years of experience. [Link]

Upcoming Events:

  • 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]
  • American Conference Institute's Life Sciences Business Development & Acquisitions in Emerging Markets conference is scheduled for September 26-27 in New York, NY. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • Boston University School of Law and the Kauffman Foundation will be holding a Workshop on Innovation and Patent Harmonization at Boston University School of Management on September 30-October 1. The workshop will cover the effect of harmonization in both advanced countries, such as the US, and in developing nations, with a particular focus on China. Anyone interested in attending, please RSVP to Elizabeth Aggot at eaa@bu.edu. [Link]
  • American Conference Institute's 12th Annual Maximizing Pharmaceutical Patent Life Cycles will take place in New York on October 4th-5th. The conference is one of the leading sources of information and analysis on the patent life cycle management. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • American Conference Institute will be holding a FDA Boot Camp Device Edition conference on October 25th-October 26th in Chicago. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

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

Patently-O Bits & Bytes by Lawrence Higgins

Is the color red functional for shoe outsoles?

  • Judge Victor Marrero recently decided the famous Louboutin red outsole trademark case and decided that the color red is functional for shoe soles. Lanham 2(e) (5) states that "no trademark…shall be refused registration…unless it– comprises any matter that, as a whole, is functional." This was a difficult case to decide, counsel for both sides made great arguments. I think the Judge had a difficult job, and basically looked at the impact the case would have on trademark law and the market. Judge Marrero stated "if Louboutin owns Chinese Red for the outsole of that another designer high fashion women's shoes, another designer can just as well stake out a claim for exclusive use of another shade of red or even Louboutin's color, for the insole…" Judge Marrero seems to think that the flood gates would open and individuals would want to trademark a color for all types and aspects of shoes. In theory Judge Marrero is 100% correct, however, I am not sure if I agree with Judge Marrero since the trademark was granted in 2008 and I have not seen any other shoe maker using colored outsoles. I am sure Louboutin will appeal the decision to cancel the red outsole trademark if the decision is finalized on August 17, 2011. [Opinion]

Mark Cuban—My Suggestion on Patent Law

  • Mark Cuban is the outspoken owner of the NBA champion Dallas Mavericks and he wanted to express his view of the patent system. Mark suggests that the solution to the patent system is to end all software patents and all process patents. He believes that software has enough protection because it is copyrightable and process patents have no purpose at all. Some benefits of eliminating process and software patents that Mark proposes are: reducing court room costs, improving the efficiency of the Patent Office, ending the current patent arms race, and creating jobs. [Link]

Will Gene Patents Impede Whole Genome Sequencing?

  • Professor Chris Holman of UMKC law school and Holman's Biotech IP Blog is in the process of finalizing an article entitled "Will Gene Patents Impede Whole Genome Sequencing?: Deconstructing the Myth That 20% of the Human Genome Is Patented". In the article Professor Holman points out that many people believe that over 20% of the genome is patented and that these patents preclude researchers from studying or even looking at the patented genes. However, Holman calls this a misperception and there is no reason to believe that 20% of human genes are off-limits. Holman states that a vast majority of human gene patents were drafted in a manner that would not encompass whole genome sequencing. [Link]

Patent Jobs:

  • Gifford, Krass, Anderson, Sprinkle & Citkowski is seeking a partner for its Ann Arbor, MI office. [Link]
  • Morris & Kamlay is seeking a patent attorney with a technology/science background to work in their Washington, D.C. office. [Link]
  • Rutan & Tucker is searching for 2 patent agents with 2-4 years of experience and a science background. [Link]
  • The American Intellectual Property Law Association (AIPLA) is seeking an individual to fill its Deputy Executive Director -International & Regulatory position. [Link]
  • Kraft Foods is searching for a patent attorney with a minimum 5 years of experience. [Link]
  • Los Alamos National Security is seeking a patent attorney with a minimum of 8 years of experience. [Link]

Upcoming Events:

  • 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]
  • American Conference Institute's Life Sciences Business Development & Acquisitions in Emerging Markets conference is scheduled for September 26-27 in New York, NY. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • Boston University School of Law and the Kauffman Foundation will be holding a Workshop on Innovation and Patent Harmonization at Boston University School of Management on September 30-October 1. The workshop will cover the effect of harmonization in both advanced countries, such as the US, and in developing nations, with a particular focus on China. Anyone interested in attending, please RSVP to Elizabeth Aggot at eaa@bu.edu. [Link]
  • American Conference Institute's 12th Annual Maximizing Pharmaceutical Patent Life Cycles will take place in New York on October 4th-5th. The conference is one of the leading sources of information and analysis on the patent life cycle management. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • American Conference Institute will be holding a FDA Boot Camp Device Edition conference on October 25th-October 26th in Chicago. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

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

Patently-O Bits & Bytes by Lawrence Higgins

Is the color red functional for shoe outsoles?

  • Judge Victor Marrero recently decided the famous Louboutin red outsole trademark case and decided that the color red is functional for shoe soles. Lanham 2(e) (5) states that "no trademark…shall be refused registration…unless it– comprises any matter that, as a whole, is functional." This was a difficult case to decide, counsel for both sides made great arguments. I think the Judge had a difficult job, and basically looked at the impact the case would have on trademark law and the market. Judge Marrero stated "if Louboutin owns Chinese Red for the outsole of that another designer high fashion women's shoes, another designer can just as well stake out a claim for exclusive use of another shade of red or even Louboutin's color, for the insole…" Judge Marrero seems to think that the flood gates would open and individuals would want to trademark a color for all types and aspects of shoes. In theory Judge Marrero is 100% correct, however, I am not sure if I agree with Judge Marrero since the trademark was granted in 2008 and I have not seen any other shoe maker using colored outsoles. I am sure Louboutin will appeal the decision to cancel the red outsole trademark if the decision is finalized on August 17, 2011. [Opinion]

Mark Cuban—My Suggestion on Patent Law

  • Mark Cuban is the outspoken owner of the NBA champion Dallas Mavericks and he wanted to express his view of the patent system. Mark suggests that the solution to the patent system is to end all software patents and all process patents. He believes that software has enough protection because it is copyrightable and process patents have no purpose at all. Some benefits of eliminating process and software patents that Mark proposes are: reducing court room costs, improving the efficiency of the Patent Office, ending the current patent arms race, and creating jobs. [Link]

Will Gene Patents Impede Whole Genome Sequencing?

  • Professor Chris Holman of UMKC law school and Holman's Biotech IP Blog is in the process of finalizing an article entitled "Will Gene Patents Impede Whole Genome Sequencing?: Deconstructing the Myth That 20% of the Human Genome Is Patented". In the article Professor Holman points out that many people believe that over 20% of the genome is patented and that these patents preclude researchers from studying or even looking at the patented genes. However, Holman calls this a misperception and there is no reason to believe that 20% of human genes are off-limits. Holman states that a vast majority of human gene patents were drafted in a manner that would not encompass whole genome sequencing. [Link]

Patent Jobs:

  • Gifford, Krass, Anderson, Sprinkle & Citkowski is seeking a partner for its Ann Arbor, MI office. [Link]
  • Morris & Kamlay is seeking a patent attorney with a technology/science background to work in their Washington, D.C. office. [Link]
  • Rutan & Tucker is searching for 2 patent agents with 2-4 years of experience and a science background. [Link]
  • The American Intellectual Property Law Association (AIPLA) is seeking an individual to fill its Deputy Executive Director -International & Regulatory position. [Link]
  • Kraft Foods is searching for a patent attorney with a minimum 5 years of experience. [Link]
  • Los Alamos National Security is seeking a patent attorney with a minimum of 8 years of experience. [Link]

Upcoming Events:

  • 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]
  • American Conference Institute's Life Sciences Business Development & Acquisitions in Emerging Markets conference is scheduled for September 26-27 in New York, NY. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • Boston University School of Law and the Kauffman Foundation will be holding a Workshop on Innovation and Patent Harmonization at Boston University School of Management on September 30-October 1. The workshop will cover the effect of harmonization in both advanced countries, such as the US, and in developing nations, with a particular focus on China. Anyone interested in attending, please RSVP to Elizabeth Aggot at eaa@bu.edu. [Link]
  • American Conference Institute's 12th Annual Maximizing Pharmaceutical Patent Life Cycles will take place in New York on October 4th-5th. The conference is one of the leading sources of information and analysis on the patent life cycle management. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • American Conference Institute will be holding a FDA Boot Camp Device Edition conference on October 25th-October 26th in Chicago. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

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

USPTO’s Future Budget

Fee-Retention Unlikely: The Senate and House of Representatives have each passed patent reform measures, and the two bills are remarkably similar. The arguably greatest difference between the two is that the Senate Bill (S. 23) includes a substantial guarantee that the USPTO will be able to actually spend the money that it collects in user-fees. The House Bill (H.R. 1249) does not include that guarantee. At this point, it appears most likely that the House Bill will be accepted in the Senate and that the PTO will be left without any budgetary protections from the congressional appropriations process.

Revenue is Revenue: Without the statutory limit, federal appropriators do not care that the USPTO is fee-funded and not taxpayer-funded. Rather, patent office fees, corporate income taxes, capital gains taxes, and personal income taxes all go into the same category of “government revenue” that can then be allocated as Congress and the President see fit.

Prior Cuts: In April 2011, a mid-year appropriations bill stripped approximately $100 million of USPTO collected fees and diverted that money to other federal programs – an approximate 10% cut in funding for the remainder of FY2011.

More Cuts on their Way?: As FY2012 approaches, it is likely that the USPTO will again feel the pinch from the most recent debt ceiling compromise and the resulting Budget Control Act of 2011. The new statute does not identify where cuts will occur, but does indicate that $21 billion will be cut from the FY2012 budget (that begins October 1, 2011) with additional cuts coming as early as December 2011. In all likelihood, some of the cuts will come from the USPTO.

Cutting from a Larger Pie: The silver lining for the USPTO is that the FY2012 budget proposed by President Obama includes a $600 million increase in spending for the USPTO – raising the budget to $2.7 billion. A 10% cut by appropriators from the budgeted amount would still leave the PTO with a $300 million increase from FY2011. It is not clear, however, that the appropriations process will use the budget proposal as the baseline.

Spending its Fees: Although Congress does not normally allow the USPTO to spend all of the fees that it collects, the USPTO is generally bound to never spend more than it collects. In other words, the PTO’s actual spending is bound by the amount that it collects in fees. The only way that the agency will be able to collect its budgeted $2.7 billion is through significant fee increases. Currently, the PTO does not generally have the authority to increase fees. However, the House Bill does provide the PTO with authority to set fees in order to meet its budgeted spending.

Correcting Patents at the District Court

CBT v. Return Path and Cisco (Fed. Cir. 2011)

CBT’s Patent No 6,587,550 covers a system of charging an “advertising fee in return for allowing” e-mail from an authorized sender to pass through an ISP.  Return Path’s Bonded Sender program (developed by Cisco) is very similar, except that the program has no advertising fee but rather charges an annual license fee.

On summary judgment, the N.D. Georgia District Court held the asserted claim 13 invalid as indefinite based upon what the court characterized as a “drafting error” made during prosecution.  The claim reads as follows:

13. An apparatus for determining whether a sending party sending an electronic mail communication directed to an intended receiving party is an authorized sending party, the apparatus comprising:

a computer in communication with a network, the computer being programmed to detect analyze the electronic mail communication sent by the sending party to determine whether or not the sending party is an authorized sending party or an unauthorized sending party, and

wherein authorized sending parties are parties for whom an agreement to pay an advertising fee in return for allowing an electronic mail communication sent by the sending party to be forwarded over the network to an electronic mail address associated with the intended receiving party has been made.

The claim indicates that the computer is programmed to “detect analyze the electronic mail” and the district court could not determine the meaning of “detect analyze” and therefore held the claim indefinite under 35 U.S.C. § 112.

On appeal, the Federal Circuit has reversed — holding that there is an obvious and correctable drafting error in the claim and that the district court has the power and obligation to correct that error in the claim construction process.

Correcting Drafting Errors in Court: The common law allows district courts to correct obvious errors in patent claims. However, that correction can only apply where “the correction is not subject to reasonable debate based on consideration of the claim language and the specification and (2) the prosecution history does not suggest a different interpretation of the claims.” Novo Industries L.P. v. Micro Molds Corp., 350 F.3d 1348, 1354 (Fed. Cir. 2003). Here, the court goes on to hold that this correction process must be done as part of the claim construction and must take into account how the correction impacts the scope of the claim.

As a claim construction issue, the Federal Circuit reviewed the District Court’s analysis de novo and held that the error was not problematic. In particular, because “detect” and “analyze” are such synonyms in this context that the particular correction made did not make much of a difference, but that the best correction is to add an “and” between the two limiting words.

Certificates of Correction: The patentee could have corrected this by filing a request for a certificate of correction with the USPTO. The chart below shows the number of certificates of correction issued by the USPTO each year since 1995. I include an estimate for the rest of 2011.

Peripheral Disclosure

By Jason Rantanen

This week I will be attending the Intellectual Property Scholars Conference, where I will be enjoying many other IP scholars' work, some of which I will discuss in subsequent posts, and presenting my own work in progress entitled Peripheral Disclosure.  In this Essay, I argue that that the disclosure function of patents has been greatly undervalued, not because patents succeed at forcing inventors to disclose useful information about their inventions in the patent document, but because patents free inventors to voluntarily share information about their inventions in forms other than the patent itself while retaining the ability to monetize their inventions.  

The abstract is below.  For those who are interested, a copy of the paper is available on SSRN here (it's currently a relatively short piece).  As this project is very much a work in progress, all comments are appreciated.

Peripheral Disclosure

The requirement that inventors disclose their inventions in return for a patent is one of the primary justifications for the patent system. Yet that justification has been subject to substantial criticism, and with good reason. Conventional disclosure scholarship focuses on inventor’s disclosure within the patent itself, a document that often fails to provide meaningful information to others. As a result, conventional disclosure theory has largely been relegated to the category of a straw man that scholars address perfunctorily when criticizing the patent system.

This Essay rejects the idea that patents serve little to no disclosure function, not by demonstrating that patents themselves convey useful information, but by pointing to other information exchanges that would not occur but for the existence of a patent system, a concept I call "peripheral disclosure." This information plays a critical role in encouraging prospective technological invention. In essence, I argue that the greatest benefit of patents is not in the information they contain, but rather in the numerous peripheral disclosures they permit, from scientific papers about new inventions to marketing materials containing technical content to the informational benefits of self-disclosing inventions. Without patents, none of these disclosures – all of which may provide crucial information to future inventors – would be possible.

Update: DePaul law student Daniel Rogna will be live-blogging IPSC at http://ebookisms.com/category/ipsc/. This is a terrific conference to follow, as it is frequently a forum where  significant new scholarship is revealed, such as last year's Lemley, Cotropia, Sampat piece on applicant submitted prior art.

BPAI Backlog: Only Growth

PatentlyO102

As Congress considers adding additional burden to the Board of Patent Appeals, the Board’s backlog of pending cases continues its dramatic rise. The process-flow of the Board appears to be fairly steady-state.  Each month, the Board receives about 1,150 cases and disposes of (decides or remands) about half (575) of those cases. The other half goes to the backlog.

Operating at this rate, it will take 3 1/2 years for the BPAI to dispose of the cases already in its docket. Thus, assuming that the BPAI takes appeals in-turn, an appeal docketed today will not be decided until the year 2015.

A note on the data: The chart is compiled from the BPAI’s own reports that are available online. [Link]  A case is only considered part of the BPAI backlog once it receives an “appeal number.” Appeal numbers are assigned only after briefing is complete.  The large “jump” in the reported backlog in early 2009 is due largely to a clerical change that identified a large number of briefed appeals that had not been given appeal numbers.

Inquiry: Does anyone have a nice memo or chart that they use to help in choosing the best after-final practice? (dcrouch@gmail.com)

Patent Statistics [Updated]

[Updated August 09, 2011 with data from all utility applications filed in ]

PatentlyO103I created a dataset of all 22,000 published patent applications that were filed in February 2006 (5 1/2 years ago).  Of those applications, about 54% have resulted in at least one patent being issued (either in original form or as a continuation or divisional); 29% are finally abandoned and have no pending child applications;* and the remaining 17% are still pending in some form.

Patent practitioners will be happy to note that all of the original still-pending applications have received at least one office action on the merits. In 79% of those pending applications, the patent applicants have also filed a request for continued examination (RCE).

For abandoned applications, the vast majority go through at least two rounds of prosecution on the merits.

Notes: * There are likely a small number of continuations that have been filed but that have not been made public yet and that therefore would not show up in this result.

 

Patently-O Bits & Bytes by Lawrence Higgins

Google and the smartphone war!

  • Google is upset with Microsoft, Oracle, and Apple in respect to the Nortel and Novell patent purchases. Google is claiming that the companies listed above and some other companies are trying to make it more expensive for phone manufactures to license Android phones. Google claims that these companies are seeking a $15 dollar licensing fee for every Android device. With more than 550,000 Android devices activated every day; these companies receive millions of dollars in licensing fees on a daily basis. Google states that these companies do not want to compete, by building new features, but instead fight through patent litigation. [Link]

The USPTO wants your input!

  • If the Leahy-Smith Act is enacted, the USPTO will need to undertake a series of rulemakings to implement the Act. Because several provisions of the Act require implementation within a period of one year from enactment, expeditious rulemaking proceedings will be required. Given this tight time frame, preliminary input from our stakeholders and the public on implementation of the key provisions would facilitate this process even before the legislation has been enacted. The USPTO has posted their views of the Act, and would like input on the following topic areas in the Act; Patents, BPAI, Fees and Budgetary Issues, Congressionally-Directed Studies and Reports, and Miscellaneous. [Link]

Is re-examination unfair?

  • Former Senator Birch Bayh recently wrote an article (and a letter to Kappos) discussing his concerns with the re-examination process. Senator Bayh co-authored the U.S. Patent and Trademark Laws Act (Bayh-Dole Act) that was enacted by congress in 1990. Senator Bayh is concerned about large companies using the re-examination process as an unfounded tactic to attack smaller companies. Senator Bayh stated that "when Senator Bob Dole and I joined to pass ground-breaking legislation on patents, the U.S. Patent and Trademark Laws Act, we never intended for it to allow malicious attacks on patents or to create an incredibly uneven playing field for small inventors." Senator Bayh concern is particularly directed to the Lockwood case, in which Lockwood sued a law firm because he felt like they requested a sham re-examination. The court ruled that, the federal patent law preempted any action in state courts. [Link] [Kappos Reply] [Case summary]

Patent Jobs:

  • Panduit is seeking a patent attorney with 2 years of experience and a background in electrical engineering. [Link]
  • Gibson & Dernier is seeking a patent associate to work at their Woodbridge, New Jersey office. [Link]
  • Choate, Hall & Stewart is looking for an attorney or patent agent with an engineering background and 2 years of experience. [Link]
  • Sandia National Laboratories is searching for a patent & licensing attorney with 3-7 years of experience. [Link]
  • Monsanto is seeking an assistant general counsel with 3 years of experience and a background in the life sciences. [Link]
  • Verenium is searching for a patent agent with a background in life sciences and at least 5 years of experience. [Link]
  • Amin Talati is seeking a patent attorney with 10+ years of experience and a background in the life sciences. [Link]
  • The Marbury Law Group is searching for a patent attorney with an electrical background and 2-8 years of experience. [Link]
  • Qualcomm is seeking a patent research librarian with a MLS and 3 years of experience. [Link]

Upcoming Events:

  • 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]
  • American Conference Institute's Life Sciences Business Development & Acquisitions in Emerging Markets conference is scheduled for September 26-27 in New York, NY. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

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

Patently-O Bits & Bytes by Lawrence Higgins

Google and the smartphone war!

  • Google is upset with Microsoft, Oracle, and Apple in respect to the Nortel and Novell patent purchases. Google is claiming that the companies listed above and some other companies are trying to make it more expensive for phone manufactures to license Android phones. Google claims that these companies are seeking a $15 dollar licensing fee for every Android device. With more than 550,000 Android devices activated every day; these companies receive millions of dollars in licensing fees on a daily basis. Google states that these companies do not want to compete, by building new features, but instead fight through patent litigation. [Link]

The USPTO wants your input!

  • If the Leahy-Smith Act is enacted, the USPTO will need to undertake a series of rulemakings to implement the Act. Because several provisions of the Act require implementation within a period of one year from enactment, expeditious rulemaking proceedings will be required. Given this tight time frame, preliminary input from our stakeholders and the public on implementation of the key provisions would facilitate this process even before the legislation has been enacted. The USPTO has posted their views of the Act, and would like input on the following topic areas in the Act; Patents, BPAI, Fees and Budgetary Issues, Congressionally-Directed Studies and Reports, and Miscellaneous. [Link]

Is re-examination unfair?

  • Former Senator Birch Bayh recently wrote an article (and a letter to Kappos) discussing his concerns with the re-examination process. Senator Bayh co-authored the U.S. Patent and Trademark Laws Act (Bayh-Dole Act) that was enacted by congress in 1990. Senator Bayh is concerned about large companies using the re-examination process as an unfounded tactic to attack smaller companies. Senator Bayh stated that "when Senator Bob Dole and I joined to pass ground-breaking legislation on patents, the U.S. Patent and Trademark Laws Act, we never intended for it to allow malicious attacks on patents or to create an incredibly uneven playing field for small inventors." Senator Bayh concern is particularly directed to the Lockwood case, in which Lockwood sued a law firm because he felt like they requested a sham re-examination. The court ruled that, the federal patent law preempted any action in state courts. [Link] [Kappos Reply] [Case summary]

Patent Jobs:

  • Panduit is seeking a patent attorney with 2 years of experience and a background in electrical engineering. [Link]
  • Gibson & Dernier is seeking a patent associate to work at their Woodbridge, New Jersey office. [Link]
  • Choate, Hall & Stewart is looking for an attorney or patent agent with an engineering background and 2 years of experience. [Link]
  • Sandia National Laboratories is searching for a patent & licensing attorney with 3-7 years of experience. [Link]
  • Monsanto is seeking an assistant general counsel with 3 years of experience and a background in the life sciences. [Link]
  • Verenium is searching for a patent agent with a background in life sciences and at least 5 years of experience. [Link]
  • Amin Talati is seeking a patent attorney with 10+ years of experience and a background in the life sciences. [Link]
  • The Marbury Law Group is searching for a patent attorney with an electrical background and 2-8 years of experience. [Link]
  • Qualcomm is seeking a patent research librarian with a MLS and 3 years of experience. [Link]

Upcoming Events:

  • 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]
  • American Conference Institute's Life Sciences Business Development & Acquisitions in Emerging Markets conference is scheduled for September 26-27 in New York, NY. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

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

Patently-O Bits & Bytes by Lawrence Higgins

Google and the smartphone war!

  • Google is upset with Microsoft, Oracle, and Apple in respect to the Nortel and Novell patent purchases. Google is claiming that the companies listed above and some other companies are trying to make it more expensive for phone manufactures to license Android phones. Google claims that these companies are seeking a $15 dollar licensing fee for every Android device. With more than 550,000 Android devices activated every day; these companies receive millions of dollars in licensing fees on a daily basis. Google states that these companies do not want to compete, by building new features, but instead fight through patent litigation. [Link]

The USPTO wants your input!

  • If the Leahy-Smith Act is enacted, the USPTO will need to undertake a series of rulemakings to implement the Act. Because several provisions of the Act require implementation within a period of one year from enactment, expeditious rulemaking proceedings will be required. Given this tight time frame, preliminary input from our stakeholders and the public on implementation of the key provisions would facilitate this process even before the legislation has been enacted. The USPTO has posted their views of the Act, and would like input on the following topic areas in the Act; Patents, BPAI, Fees and Budgetary Issues, Congressionally-Directed Studies and Reports, and Miscellaneous. [Link]

Is re-examination unfair?

  • Former Senator Birch Bayh recently wrote an article (and a letter to Kappos) discussing his concerns with the re-examination process. Senator Bayh co-authored the U.S. Patent and Trademark Laws Act (Bayh-Dole Act) that was enacted by congress in 1990. Senator Bayh is concerned about large companies using the re-examination process as an unfounded tactic to attack smaller companies. Senator Bayh stated that "when Senator Bob Dole and I joined to pass ground-breaking legislation on patents, the U.S. Patent and Trademark Laws Act, we never intended for it to allow malicious attacks on patents or to create an incredibly uneven playing field for small inventors." Senator Bayh concern is particularly directed to the Lockwood case, in which Lockwood sued a law firm because he felt like they requested a sham re-examination. The court ruled that, the federal patent law preempted any action in state courts. [Link]
    [Kappos Reply]
    [Case summary]

Patent Jobs:

  • Panduit is seeking a patent attorney with 2 years of experience and a background in electrical engineering. [Link]
  • Gibson & Dernier is seeking a patent associate to work at their Woodbridge, New Jersey office. [Link]
  • Choate, Hall & Stewart is looking for an attorney or patent agent with an engineering background and 2 years of experience. [Link]
  • Sandia National Laboratories is searching for a patent & licensing attorney with 3-7 years of experience. [Link]
  • Monsanto is seeking an assistant general counsel with 3 years of experience and a background in the life sciences. [Link]
  • Verenium is searching for a patent agent with a background in life sciences and at least 5 years of experience. [Link]
  • Amin Talati is seeking a patent attorney with 10+ years of experience and a background in the life sciences. [Link]
  • The Marbury Law Group is searching for a patent attorney with an electrical background and 2-8 years of experience. [Link]
  • Qualcomm is seeking a patent research librarian with a MLS and 3 years of experience. [Link]

Upcoming Events:

  • 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]
  • American Conference Institute's Life Sciences Business Development & Acquisitions in Emerging Markets conference is scheduled for September 26-27 in New York, NY. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

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

Guest Post: What We Said (and Didn’t Say) in the Berkeley Patent Study

Guest Post by Robert Merges, Pam Samuelson, and Ted Sichelman

In 2008, along with Stuart Graham (now Chief Economist at the USPTO) and Robert Barr (Executive Director of the Berkeley Center for Law &Technology), we conducted the most comprehensive survey to date on startup companies and patenting in the United States. Funded by the Ewing Marion Kauffman Foundation, our survey reported results on the drivers of patenting, the role of patenting in startup financing and the innovation process, and a number of other important areas. We have described initial results from the survey (here) and in a follow-up article (here). We also posted a three-part series on Patently-O on the survey (here, here, and here).

Since the publication of our articles, a number of commentators have drawn bold—and somewhat contradictory—inferences from our results. Former Chief Judge of the Federal Circuit, Paul Michel, and CEO of Tessera, Hank Nothhaft, stated in a New York Times op-ed that, "[A]ccording to our analysis of the data in the Berkeley Patent Survey, each issued patent is associated with 3 to 10 new jobs." Yet, Harold Wegner, a patent lawyer at Foley & Lardner who authors a popular e-mail distribution, contends that the USPTO's position that "prompt patent grants will stimulate innovation" and thus "create American jobs" is "in direct conflict" with the Berkeley Patent Study. According to Mr. Wegner, "the Berkeley Study questions showed that for many high technology areas patent grants played no role or a minimal role in stimulating innovation." From this inference, he concludes, that "A fortiori, prompt patent grants would be irrelevant" to stimulating innovation and, hence, creating American jobs. And, finally, Ronald Katznelson, an independent inventor active in the patent reform debates, states bluntly: "The Berkeley study is typical of other flawed 'scholarship' on patents by academics. They ask the wrong questions of the wrong people and draw wrong and counterfactual inferences. … The question that startup CEOs should have been asked is 'who are your investors and can we interview them for their reasons to invest in your startup?'"

We're writing this post because, as authors of the study, we feel obligated to dispel these and similar misunderstandings with four basic observations:

  1. Our results solely concern U.S. startups. The vast majority of patents are filed and owned by established companies. More than half of all patents are awarded to foreign companies. Because U.S. startups use and are affected by the patent system in ways quite different from established and foreign entities, it is impossible solely from our data to draw conclusions about the general role of patents on innovation or jobs.
  2. Even limiting the issue of jobs to those of U.S. startups, there is no principled way to determine from our data whether or not additional patents lead to additional jobs, much less the number of jobs created by each patent. Granted, we reported the average number of employees, including the percentage of engineers, at our respondent companies. But to reason that these positions were the direct result of the respondents' patent portfolios would be to ignore a host of other potential factors (e.g., first-mover advantage, other IP protection, management team quality, etc.) leading to those jobs. And there is no sound way using our data to remove these other potential effects so as to calculate the impact of patents on jobs.
  3. It is misguided to conclude from our results that "for many high technology areas [executives reported that] patent grants played no role or a minimal role in stimulating innovation," that "prompt patent grants would be irrelevant" to stimulating innovation. First, as we said earlier, our study only applies to U.S. startup companies. Second, many executives—particularly those in the biotechnology and medical device industries—reported that patents provide strong or moderate incentives to innovate. In the very least, prompt patent grants for these companies would not be "irrelevant" to stimulating innovation. Last, our responses on the role of patents in the innovation process relates to the patent system as it is currently constituted. It could very well be the case that faster patent grants would significantly increase the role patents play in promoting innovation.
  4. Ron Katznelson's contention that our study is typical of "flawed" academic scholarship—namely, because we failed to ask "who are your investors and can we interview them for their reasons to invest in your startup?"—overlooks several critical aspects of the study. First, before drafting the survey questions, we interviewed a number of investors informally and asked them "for their reasons to invest" in startups. (Unfortunately, our limited funding for this study did not allow us to conduct a large-scale survey of investors, but we hope to do so in the future.) Second, our survey specifically asked executives at startups to indicate whether their potential investors considered patents important to their investments. In this regard, our advisory board for the study included prominent venture capital firm partners, who worked closely with us in formulating the survey questions. As we explained at length in one of our articles (here), startups in all sectors we surveyed reported that patents were considered important by a sizable percentage of venture capital firms and other types of investors with whom they negotiated.

In the vein of our last observation, we hope that others will indeed read our articles (here and here, plus for background on the survey, see here) in detail and only report and rely upon the conclusions we draw in those publications. To make further inferences, especially without access to the underlying data in the study—which we cannot make publicly available due to confidentiality restrictions—will almost invariably lead to conclusions that are simply not supported by our data set.

In sum, we are grateful for the extended discussion and use of our study results—but, as the researchers who conducted the study—we hope that our results will not be stretched to unsupportable ends.

Robert Merges is the Wilson Sonsini Goodrich & Rosati Professor of Law at the University of California, Berkeley, School of Law. Pamela Samuelson is the Richard M. Sherman Distinguished Professor of Law at the University of California, Berkeley, School of Law. Ted Sichelman is an Associate Professor at the University of San Diego School of Law. Neither Stuart Graham nor Robert Barr played any role in the drafting this post.

The Impact of Patent Reform on Filing Strategy (I)

The new law defining prior art would become effective 18–months from the date of enactment of H.R. 1249.  Patent applications filed after that date would be bound by the new first-to-file rules. The major exception is that old invention-date rules will also apply to any application having a claim having a proper priority filing date of prior to the change-over. 

That date will likely be a filing bonanza, much like the what occurred in the lead-up to the June 8, 1995 change in patent term as shown in the chart below.

PatentlyO100

Applicants who beat the 1995 deadline were granted given either a patent term of 17 years from issuance or else 20 years from filing, whichever was longer as calculated at issuance. In that scenario, there were very good reasons to file before the deadline.

When the new deadline comes, I suspect that the current regime will look more favorable than the new because of the new limits on swearing-behind prior art based upon a prior invention date and claiming a grace period for third-party disclosures. One reason an applicant might delay is because of the new “micro-entity” status that offers lower fees, but even then the best course of action would be to file a provisional application early followed by non-provisional at the lower fee.

Are there reasons why a patent applicant would choose to delay filing an application until after the new deadline?

Scholarship Roundup: Crouch and Merges, Operating Efficiently Post-Bilski by Ordering Patent Doctrine Decision-Making

By Jason Rantanen

Earlier this week I mentioned a recent article by Dennis Crouch and Robert P. Merges, entitled Operating Efficiently Post-Bilski by Ordering Patent Doctrine Decision-Making, 25 Berkeley Tech. L.J. 1673 (2010), as proposing that patent litigation might be streamlined by deciding cheaper and easier issues early in the litigation process.

In the article, Professors Crouch and Merges suggest that the best way to proceed post-Bilski is not to attempt to cut through its complexity, but rather to avoid it.  They propose this be done by reordering litigation so that claim validity is first tested against one of the less controversial and complex requirements for patentability before reaching the complex issue of subject matter patentability – in essence, applying a "chain theory" of patentability, where PTO and courtroom analysis should start with the easiest and cheapest links to test and terminate once a patent is held invalid.

A full copy of the article can be obtained here:  Download Crouch and Merges – Post Bilski Ordering.

 

Eon-Net v. Flagstar Bancorp: Exceptional Case after Remand

By Jason Rantanen

Eon-Net LP v. Flagstar Bancorp (Fed. Cir. 2011) Download 09-1308
Panel: Lourie (author), Mayer and O'Malley

This decision is an important opinion in the area of litigation sanctions entered against a patentee, and should be read in conjunction with two cases issued earlier this year, iLor v. Google, 631 F.3d 1372 (Fed. Cir. 2011), and Old Reliable v. Cornell, 635 F.3d 539 (Fed. Cir. 2011).  Patently-O commentary on those cases can be found here and here.

Background
Eon-Net is a patent holding company formed to enforce the three patents in suit, which it did with vigor.  While most of its lawsuits resulted in early settlements or dismissals, Eon-Net's suit against Flagstar took a different turn.  The district court initially entered summary judgment of non-infringement on the sua sponte ground "that the written description limited the claims to processing information originating from a hard copy document and Eon-Net's position that the claims covered the processing of information entered on a website was baseless," and awarded Rule 11 sanctions.  Slip Op. at 7.  However, that decision was vacated by the Federal Circuit because Eon-Net had not been given an opportunity to respond, and thus "it was impossible to determine if Eon-Net's claim construction and infringement positions were without merit."  Id. at 8.

On remand, the case was reassigned to a new judge and the parties engaged in the claim construction process, after which the court again limited the disputed elements to information originating from a hard copy document.  Eon-Net stipulated to non-infringement.  Upon motion by Flagstar, the district court found the case exceptional under 35 U.S.C. 285 and in violation of Rule 11 of the Federal Rules of Civil Procedure. On appeal, the CAFC first affirmed the district court's claim construction before turning to the exceptional case finding.

Many Varieties of Misconduct Can Support an Exceptional Case Finding
Before engaging in analysis of the specific bases for the district court's exceptional case finding, the CAFC first noted that many varieties of misconduct can support an exceptional case finding under 35 U.S.C. § 285: lodging frivolous filings, engaging in vexatious or unjustified litigation, and litigation misconduct and unprofessional behavior.  The court reiterated, however, that absent litigation misconduct or misconduct in securing the patent, "sanctions under § 285 may be imposed against the patentee only if both (1) the patentee brought the litigation in bad faith; and (2) the litigation is objectively baseless."  Slip Op. at 17.

Eon-Net Filed Objectively Baseless Litigation in Bad Faith
Affirming the district court's exceptional case finding, the Federal Circuit agreed that this lawsuit was objectively baseless, filed in bad faith and for an improper purpose.  After distinguishing iLor v. Google, in which the CAFC also addressed the issue of whether a claim construction was objectively baseless, the court turned to the question of whether Eon-Net had filed the lawsuit in bad faith and for an improper purpose, concluding that it had:

In particular, the district court found that Eon-Net’s case against Flagstar had “indicia of extortion” because it was part of Eon-Net’s history of filing nearly identical patent infringement complaints against a plethora of diverse defendants, where Eon-Net followed each filing with a demand for a quick settlement at a price far lower than the cost to defend the litigation.

Slip Op. at 22.  This strategy of exploiting the high cost to defend complex patent litigation in order to extract nuisance value settlements constituted bad faith.  The court pointed to Eon-Net's pattern of filing complaints, then demanding quick settlements at a price far lower than the cost of litigation.  Parties must either expend significant resources to defend against the suit – as Flagstar did in this case – or give in to the nuissance settlement demand.  FIling such a meritless lawsuit also is also a waste of judicial resources, as it "unnecessarily require[s] the district court to engage in excessive claim construction analysis before it is able to see the lack of merit of the patentee's infringement allegations."  Slip Op. at 23. 

Of course, patentees should be able to enforce their patent rights or offer licensing terms.  Nevertheless, "the appetite for licensing revenue cannot overpower a litigant’s and its counsel’s obligation to file cases reasonably based in law and fact and to litigate those cases in good faith."  Slip Op. at 24.

Comment: although the CAFC affirmed the district court's finding that Eon-Net had acted with an improper purpose, it did not suggest that that requirement should be grafted onto the "bad faith" element.

The CAFC also affirmed the district court's finding that Eon-Net and Zimmerman had engaged in litigation misconduct and its imposition of Rule 11 sanctions.

Patentable Subject Matter and the Supreme Court Myriad Preview

Myriad's patent claims are directed, inter alia, to several isolated human DNA molecules that represent the BRCA1 and BRCA2 genes. These gene mutations are associated with an increased risk of developing breast and/or ovarian cancer. Because women with these gene mutations are much less likely to survive into old-age, many choose to undergo extensive preventive surgery in an attempt to avoid the risk. In other words, the genetic information and testing technology is important. 

Fundamentals of Patentability: Most patentability decisions focus on either an invention's obviousness or a patent's failure to properly disclose the invention. The Myriad case looks at something more fundamental – whether isolated human DNA is, in general, the type of thing that should be patentable.

Product of Nature: In this case, all the parties agree that the claimed DNA molecules are "compositions of matter" that nominally fall within the statutory guidelines of patentable subject matter found in 35 U.S.C. § 101. The disagreement comes from the common law gloss that the Supreme Court has added to the statute. Namely, the Supreme Court has repeated stated that, regardless of the novelty of the invention, neither products of nature nor natural phenomena qualify for patenting. The big issue in this case boils down to whether the claimed molecules fall within this product of nature exception.

Human-Made Inventions: According to the Court, "human-made inventions" sit at the opposite end of the spectrum from products of nature. To be distinguishable from products of nature, a human made invention must be "markedly different" or express "distinctive" characteristics from what is found in nature.

Patenting Isolated cDNA: Myriad's patent also claim cDNA molecules that are synthesized in the lab using the naturally occurring enzymes reverse transcriptase and DNA polymerase.  cDNA differs from native DNA in that the cDNA typically (and in this case) represents only the information for a single gene and with unnecessary (intron) information removed. Native DNA is typically part of a large single molecule (a chromosome) that includes lots of genes and lots of introns intermixed between and within gene coding. The human body has a natural process for accessing and using the particular gene when it is needed. To do this, enzymes are able to create an RNA strand that mirrors the DNA information and that removes the introns. In the human, that RNA is then used to create a protein used by the body. For Myriad, the RNA is instead transcribed back into DNA (now called cDNA because it is [c]omplementary to the RNA).

To be clear, Myriad did not claim to invent any of this process or to invent cDNA in general. Rather, Myriad invention is that it created a cDNA molecule that holds the exact same information as the naturally occurring BRCA1/BRCA2 RNA.  Certainly, cDNA is chemically different from RNA — it is preferred in the lab because it is double-stranded and typically more stable.   An additional difference here is that the claimed cDNA is isolated from the cell and the living organism so that it it can be tested and used in different ways.  

Holding: cDNA is Markedly Different from That Found in Nature: The Federal Circuit considered these arguments, but decided to take a different perspective — focusing on differences instead of similarities. In holding the claims patentable, the court reasoned that: 

  1. The claimed cDNA is a molecule that is not found in nature.
  2. The claimed cDNA is quite different from a native chromosomal DNA.
  3. Human intervention of cleaving and/or synthesizing is necessary to make the cDNA.
  4. Because the molecule is changed, it cannot be said to be merely "purified."
  5. Judge Moore goes on to explain that the cDNA sequence is "completely different than the corresponding RNA."

Insignificant Extra-Solution Modification: In a number of cases, the Supreme Court has worked to conflate the issues of patentable subject matter with issues of obviousness and novelty.  Thus, for instance, courts have repeatedly noted that insignificant extra-solution modifications of an invention cannot whitewash an otherwise unpatentable invention.   Here, potential conflation has a strong foothold because the real breakthrough at the time was discovery of the genetic sequence itself.  It took tremendous effort and ingenuity to discover that transcription map and that map was the key to their discovery as outlined in the inventors 1994 Science article.  However, in 1994 (the time of the invention) once a sequence was known, almost any trained molecular biology lab technician could manufacture the isolated cDNA with effort but without much necessary ingenuity. If the discovered map itself was unpatentable as merely information and the process to create the isolated DNA was already known, then where is the invention? This type of analysis is outside of mainstream Federal Circuit decisions, but if the Supreme Court takes the case, the interplay between what was invented and what was already known may well be an important element in to the court's discussion of patentable subject matter.  

   

   

   

Patent Reform 2011: House Bill Coming to the Senate in September

[Update 8/3/2011] In the immediate wake of the debt crisis “solution.” President Obama talked about the next steps for Congress.  High on his agenda: Patent Reform:

Through patent reform, we can cut the red tape that stops too many inventors and entrepreneurs from quickly turning new ideas into thriving businesses — which holds our whole economy back.

Senate Majority Leader Harry Reid then announced that the patent reform bill will be the first item taken up for consideration when the Senate returns from recess. 

Parallel patent reform Bills have already passed the House and the Senate.  The Bills have a number of differences. 

Senate democrates have filed a cloture motion to end debate on patent reform and take an immediate vote on H.R. 1249 in toto once the Senate returns from vacation in early September.  Under this scenario, the legislation would not need to return to the House for any further consideration.

Joint Appendix Practice

By Jason Rantanen

ClearValue, Inc. v. Pearl River Polymers, Inc. (Fed. Cir. 2011) (nonprecedential order) Download 2011-1078.8-1-11.1

The preparation of joint appendices in connection with Federal Circuit appeals is an instance where rules and practices often collide.  Technically, parties may only include the specific record pages actually referenced in the parties' briefs.  See Federal Circuit Rule 30(a)(2)(B).  With few exceptions, no additional context pages are permitted by the rules.  For example, the joint appendix rules technically preclude the addition of the cover page of motions that contain pages being cited.  Prior art references may not be included in their entirety – only the specific pages that are referenced – unless they are a patent.  And it would be a violation of the rules to include the page before or after a cited page of a textbook or technical manual.  The main exception relates to "transcript pages," for which the rules encourage parties submit sufficient surrounding pages to provide context for a referenced excerpt.  In addition, the court's rules prohibit "indiscrininate referencing in briefs to blocks of record pages," so parties may not include large quantities of the record via broad citation.  FCR 30(a)(2)(C).

In reality, appellants and appelles sometimes disregard these strict rules, and instead make some attempt to provide enough context so that cited materials are meaningful to the court.  Parties risk incurring the court's wrath should they go too far, however, as illustrated by Judge Prost's order in ClearValue.  ClearValue did not simply attempt to provide a few context pages; rather it apparently indiscriminately cited to an entire 195-page training manual, an entire 344-page motion for summary judgment, and an entire 797-page transcript.

This practice violated Federal Circuit Rule 30, and the court ordered ClearValue to reimburse the appellant for its copying costs, to correct its briefs to cite only those pages of the documents that are relevant to the issues it raises, and to prepare a new joint appendix containing only those items cited by the parties in their briefs, along with a few pages before and after the relevant testimony paassages for context. 

While I agree with the court's response in this particular circumstance, given the quantity of likely unnecessary material that ClearValue required be included in the appendix, the court's opinion highlights the jumbled nature of the joint appendix rule.  For some materials (patents and testimony), context is allowable; for everything else, it is not.  Unless there is a good reason to draw this line, perhaps the rule should be revised to apply equally to all materials included in the appendix. 

Thanks to Hal Wegner for pointing out this nonprecedential order in his email newsletter.

The BPAI’s Precedent: Most Cited Cases by the Board

The following list provides the most-often cited cases in BPAI decisions thus-far in 2011.

The vast majority of BPAI decisions involve a patent applicant appealing an examiner's final rejection and the most common patentability issue on appeal is obviousness. Thus, it is not surprising that many of the cited cases involve obviousness and claim construction issues. These cases have influenced the court in the past and are likely to continue to do so.

  1. KSR v. Teleflex, 550 U.S. 398 (2007) (Standard for obviousness);
  2. In re KAHN, 441 F.3d 977 (Fed. Cir. 2006) (Reasons for obviousness determination must be articulated);
  3. In re AMERICAN ACADEMY OF SCIENCE TECH CENTER., 367 F.3d 1359 (Fed. Cir. 2004) (Claims should be given their broadest reasonable interpretation);
  4. In re OETIKER, 977 F.2d 1443 (Fed. Cir. 1992) (The examiner has the burden of presenting a prima facie case for rejection);
  5. Graham v. John Deere, 383 U.S. 1 (1966) (Methodology for determining obviousness);
  6. In re Keller, 642 F.2d 413 (C.C.P.A. 1981) (A rejection premised upon a combination of references cannot be overcome by attacking the references individually);
  7. In re Morris, 127 F.3d 1048 (Fed. Cir. 1997) (Claims should be given their broadest reasonable interpretation consistent with the specification);
  8. Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (ordinary meaning of claim);
  9. In re Merck, 800 F.2d 1091 (Fed. Cir. 1986) (Non-obviousness cannot be established by attacking references individually where the rejection is based upon the teachings of a combination of references);
  10. In re Best, 562 F.2d 1252 (C.C.P.A. 1977) (When the PTO identifies prior art that is the same or substantially the same as claimed subject matter, the burden shifts to the applicant to come forward with evidence and argument showing that the prior art products do not necessarily or inherently possess the characteristics of the claimed product);
  11. In re Zletz, 893 F.2d 319 (Fed. Cir. 1989) (Claims must be interpreted as broadly as their terms reasonably allow but limitations should not be read into claims);
  12. In re Schreiber, 128 F.3d 1473 (Fed. Cir. 1997) (claim structure form primary claim limitations; elements of anticipation);
  13. In re Spada, 911 F.2d 705 (Fed. Cir. 1990) (process of proving anticipation);
  14. In re Gurley, 27 F.3d 551 (Fed. Cir. 1994) (Teaching away; A known or obvious composition does not become patentable simply because it has been described as somewhat inferior to some other product for the same use); and
  15. In re Warner, 379 F.2d 1011 (C.C.P.A. 1967) (The PTO must produce factual basis for its decisions).

To create the table, I first parsed all of the BPAI decisions that have been released thus far in 2011 in order to create a table of authority for each case. I then ranked the cited cases to find those that were most-often cited.

As an interesting tidbit, I also looked for correlation between the citation of a particular case and the outcome of the BPAI decision. As you might expect, some cases are better for patent applicants. Two examples of this are In re Warner and In re Gurley. In cases citing Warner, the examiner's rejections are affirmed less than 10% of time. On the flip side – cases citing Gurley affirm the examiner rejection in more than 80% of cases.

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