Patent Exhaustion: Licensing Handset Manufacturers Did not Exhaust Patent as to Downstream Content Providers

by Dennis Crouch

A patent holder has exclusive rights in the patented invention and a cause of action against “whoever without authority makes, uses, offers to sell, or sells” the invention. 35 U.S.C. 271(a). One limit on those rights is the non-statutory doctrine of patent exhaustion. Under exhaustion, after a patentee authorizes the making/sale of a particular individual article, the patentee no longer has any further exclusive patent rights in association with that authorized article.  Thus, the when the authorized product is later used or re-sold, the patentee could not claim further damages for infringement.  In other words, the power of the patent is ‘exhausted’ by the first authorized sale. As noted, the exhaustion doctrine is non-statutory, but the Supreme Court has repeatedly supported its existence as a parallel the statutory version found in copyright law. 17 U.S.C. 109.

In Helferich Patent Licensing v. NYTimes and JCPenney (Fed. Cir. 2015), the Federal Circuit (Judge Taranto) has narrowly construed the exhaustion doctrine – finding that the district court erred in holding that the patentee’s claims were barred due to exhaustion.

Helferich’s 30+ patents all relate to wireless handsets and related communication methods.  All the patents stem from a common original application and are thus closely related, although the PTO did not find obviousness-type double patenting.

Helferich has licensed its portfolio to essentially all handset makers selling in the U.S.  However, those licenses expressly carves-out activity by “content providers” — stating particularly that the licenses do not grant any rights for content providers to practice the claimed methods.

When Helferich then brought suit against content providers (NYTimes & JCPenny), those accused infringers argued exhaustion — namely that the manufacture and sale of the phones had been licensed under the now-asserted patents and that, as a consequence, the exhaustion doctrine blocks any there is no use of the phones that could now be seen as infringing.

[T]he premise of defendants’ exhaustion defense is that all handsets in the United States are licensed and that the asserted claims contemplate a use of handsets by handset owners/possessors.

However, in the appeal, the Federal Circuit found that the exhaustion doctrine does not bar Helferich’s claims here.

The Federal Circuit identifies exhaustion as a personal defense held by the acquirer of an authorized article (here, a handset).  However, according to the court, exhaustion does not apply to protect other parties. This distinction here is important because the accused infringers are content providers and – apparently – the content claims do not require any proof that the handset acquirers are practicing any aspects of the claims.  Secondly, the court also identifies the content claims being asserted here as separate and distinct inventions from the licensed handset claims.

In short, the decisions finding exhaustion (or relying on exhaustion to reject an antitrust defense) have done so only when the patentee’s assertion of infringement was, or depended on, an assertion that an authorized acquirer was using the same invention by infringing the asserted claims.

The closest case-on-point found by the Federal Circuit is Morgan Envelope Co. v. Albany Perforated Wrapping Paper Co., 152 U.S. 425 (1894) where the court wrote (in dicta?) that that exhaustion would not apply to excuse infringement of related – but distinct – patents.

The Morgan Court thus indicated that, even though an authorized buyer of product X was free of the patent owner’s patent on that product, the buyer could not, by virtue of his purchase, prevent the patent owner from enforcing his patent as to product Y, even though Y was specifically designed to be used with X and, at a minimum, made X more useful than it otherwise would be and, indeed, was essential to X’s utility.

Of course, a major difference with the old cases is that the added-element being supplied here is in the form of information rather than a tangible product.

In considering the impact of the 1952 and 2011 patent reforms on the judge-made law of exhaustion, the court writes “[w]e presume, from Congress’s refusal to disturb the existing decisional law of this doctrine (which predated the 1952 Act by nearly a century), an implicit authorization to continue applying the doctrine within its familiar boundaries. . . . But we do not think that Congress has granted the courts a license to erase those boundaries and expand the doctrine into difficult new territory unmapped by lines drawn, or even sketched, by Congress.” Thus, the court refused to consider policy considerations that would suggest doctrinal expansion.

The decision winding here by Judge Taranto is well supported, but I would also expect a strong challenge to be mounted for Supreme Court review.

About Dennis Crouch

Law Professor at the University of Missouri School of Law. Co-director of the Center for Intellectual Property and Entrepreneurship.

69 thoughts on “Patent Exhaustion: Licensing Handset Manufacturers Did not Exhaust Patent as to Downstream Content Providers

  1. This opinion appears to provide support for the view expressed in Judge O’Malley’s Keurig concurrence, 732 F.3d at 1375.

  2. Anyone representing any major company should be paying attention to these plural patents and their many claims, and noting the clever attorneys behind this organization,* as they may well be or become future targets themselves.
    By cleverly issuing a number of patents with numerous broad claims using continuations from a single spec [a la Lemelson] and offering settlement license fees low enough to discourage defenses by litigation [a la Lemelson] it will be expensive and difficult to shoot them all down even with IPRs. Unless there is cooperation between threatened targets, rather than just numerous lucrative settlement payments.
    The rejected S.J. here, solely on a license issue, is merely a preliminary opening side show.
    *I understand that Jerry Hosier is an “adviser” to Helferich Patent Licensing.

    1. Wiki:

      Gerald D. Hosier is an American intellectual property (IP) attorney and a patent litigator. In 2000, Forbes magazine declared him the highest-paid lawyer in America, with an annual income of $40 Million… He has served as the main attorney for Jerome H. Lemelson, the named inventor on 741 US patents, and the self-proclaimed inventor of bar code scanning. …

      link to wweek.com

      In September 1989, just one month after Lemelson hired him, Hosier added new claims to Lemelson’s pending applications for patents on bar-code technology, then promptly sent out letters to hundreds of electronic, semiconductor and automobile companies, explaining that they were infringing those patents. The vast majority of these companies chose to pay Lemelson licensing fees rather than risk expensive, and highly unpredictable, litigation over whether his claims were valid.

      Ten years later, in April 1999, Forbes was reporting that Hosier was “picking his way through blue-chip firms, looking for patent infringements and enriching Lemelson’s family, his scientific causes and himself.”

      But it was all “legal” so let’s all stand up cheer for this great American lawyer who gave his all for the (trying not to gag here) “little guy.” Hosier’s a lot like Harriet Tubman, really, if you think about it really, really, really hard and pretend that up is down.

      If only there were thousands more like him and trickle down economics actually worked then this country would be so much better off. Why do people complain about patents on telling people that there is some information available if you “click here”? There are so many other important issues. I just heard someone at the PTO had a “secret” meeting about a patent application that added an entire day to the examination of the patent. Thomas Jefferson would never have approved of that, nor would his slaves have approved.

    2. Paul, I never really got into the Lemelson claims back in the day, but if his multitude of patents were claiming variations on the same invention as it appears to be the case here, then the patent office was not doing the public any favors by not entering double patenting rejections and forcing terminal disclaimers to be entered by Lemelson. That way, even though he had priority dates back to the dark ages, he could not have extended, and continue to extend, his patents into the far future.

      I know one of the reasons that we adopted the 20 year from filing date term was to address the Lemelson problem. But as I said, and I continue to think, the problem was not that he was claiming independent inventions disclosed in his original applications, but that he was claiming the same invention again and again and again.

      From my quick review of the patents in the present case, they all appeared to have the same novelty. They are not different inventions. The litigators and the courts have to get together to solve this problem but I think it is exhaustion in this case. But, for some reason, the Federal Circuit never seems to be able to figure things out. Perhaps this has to be taken the Supreme Court simply to tell the Federal Circuit and the patent office that it must enter double patenting rejections when the same novelty is involved in the claims in different patents and applications.

      And then we have to figure out how exhaustion plays into the double patenting situation where one is making, using or selling a product to someone else who has a license where the patents are divided, but are essentially claiming the same invention.

      1. Ned,

        You appear to have gone off the deep end with a “Gisting” approach in your reaching of a “same invention,” pinning as you do, to some notion of novelty apart from not only novelty of the claim, but novelty of the claim as a whole.

        You are engaging as if the pre-1952 single paragraph were in play.

        It is not.

        While you have not used the term (you know the one that involves ‘novelty,’ but you insist on using in a 101 sense), there is no mistaking the ig noring of what Congress did in 1952, as subsequently explained by the architect (the man best positioned to know the intent of the law), none other than Judge Rich.

        Your “essentially” thinking is ig noring claim elements. I seriously think that you are living in the past, and somehow think of patents as not “really” having claims at all (or at least, not giving claims – and their different elements – full and proper respect).

      2. Yes Ned, and note that one of the provisions of the Goodlatte bill will add express statutory double patenting authority to AIA patents.

  3. It’s critical to look at the claims at issue here to understand what’s going on. While the claims themselves are awful and will surely end up in the trash bin after a minimal amount of review by a competent gatekeeper, the non-application of the exhaustion doctrine in this instance isn’t terribly off-the-wall. But, as others have already noted in the thread, the exhaustion doctrine assumes that the claims being asserted aren’t ridiculous on their face.

    Here’s the truly horrendous “content” claims:

    1. A method of providing content to a cell phone comprising:

    a content provider causing the content to be stored in an internet accessible storage unit;

    the content provider initiating a page to a content subscriber, the page including a notification that: (i) identifies the content, and (ii) includes an address of a system to be contacted to trigger retrieval of the content, but does not include the content;

    wherein the page indicates that the content is available for a specified time; and

    the content provider causing the content identified by the notification to become inaccessible at the internet accessible storage unit after identified by the initiated page.

    Among other problems, this is an ineligible claim because it protects information. Specifically, it fails to describe any new technology or any new transforming process steps but instead restricts the type of information that can be provided using old technology. In the event that it isn’t already obvious to everybody (and it should be by now!), the specific information in question is “notification that: (i) identifies the content, and (ii) includes an address of a system … and … indicates that the content is available for a specified time.”

    Note that if you wanted to apply the exhaustion doctrine broadly, this claim could be exhausted by the sale of *any* patented “cell phone” (assuming the same patentee owns both the patents on the cell phone and the the content-providing methods).

    NYTimes and JC Penney don’t have an exhaustion problem. Their problem is they licensed some junk claims from a bottom-feeder who is coming after them with even junkier ineligible claims. And again: one of the major purposes of the eligibility restrictions in our system is to eliminate problems like this one which become rampant when those eligibility restrictions are ignored (as the PTO did when it granted the claims).

    Let’s say you’re a gravel company. What happened in this case is no different than if Bob’s Dumptrucks sold you a patented dump truck and then came after you with a separate claim for delivering gravel by a generic dumptruck wherein the gravel is ordered “on the Internet”.

    1. Just an added note to highlight the incredible waste of time and money that resulted from the granting of these ineligible “content” claims. Also, note (again) how the assertion of such claims inevitably puts tension on existing case law.

      Patent maximalists endlessly recite their self-serving mantra that “patent law should adopt to new technology”. But as with so many claims to computer-implemented junk, all that was “new” when this claim was filed and prosecuted was the fact that patent attorneys and “innovators” with the technical skill of your typical five year old were getting away with garbage claims like this one.

      1. The sad thing is that your nonsense is just endlessly repeated no matter the fact pattern. That is one consequence of not applying the law in your analysis.

        1. not applying the law in your analysis.

          Information is quintessentially abstract and is ineligible subject matter. You need a “cite” for that? Look it up.

          If your patent prevents me from communicating information using old technology, your patent is ineligible. Go back to elementary school and learn some basic logic if you have difficulty following this. The Supreme Court doesn’t (9-0) and the Federal Circuit seems to have figured it out, too, along with most of the reasonable district court judges. That leaves just a tiny handful of reality-denying, self-interested patent attorneys and their “clients” (who are often identical when they aren’t foreign criminals hiding behind a shell company).

          The sad thing is that your nonsense is just endlessly repeated

          The sad thing is you’re talking about yourself, not me. My analysis is specific to the claim and the facts in this case. If you had actually read my comment you would know that.

            1. Isn’t the case about exhaustion?

              The case is about a bottom-feeder asserting some junky patent claims. The defendant brought up patent exhaustion as defense. That defense did not work (yet). The issue of the junky patent claims therefore looms larger than ever.

              Why ignore it? Because you happen to be asserting very similar claims and you can’t stand to hear reasonable criticism of those claims? Guess what: that’s your problem. Get used to it.

              What part of your argument concerns exhaustion?

              Which argument are you referring to? I refer numerous times in my comment to exhaustion. If you think anything I said is incorrect, then by all means feel free to say so and explain why, using the English language and declarative sentences. Try it sometime. Of course, if your response includes errors (e.g., putting words in my mouth or making silly assumptions or attacking strawmen) then you can be confident that I’ll point them out. Welcome to the discussion.

              PS: If you have something to say about patent exhaustion in any context, including in the situation where the patentee asserts an ineligible claim that would illegally prevent the rightful owner of a communication device from communicating some specified “information content”, then try to share that something with everybody.

            2. PatentBob,

              To answer your question directly, these eleven words make up the only on-point contribution from Malcolm:

              the non-application of the exhaustion doctrine in this instance isn’t terribly off-the-wall

              That’s it.

              1. Of course, the super serious and never hypocritical commenter “PatentBob” could have made the exact same comment about “anon’s” post Number 1.

                But he didn’t. Gee, I wonder why.

                1. Maybe because my post 1 was far better than your mindless usual claptrap, which merely reflects your b@nal pay theory based solely on aggregation.

  4. As noted, the exhaustion doctrine is non-statutory,

    Oh noes! Separation of powders! Someone call Super Constitution Man before the Republic collapses.

      1. I presaged your off-point rant

        Nice try but the joke’s on you, “anon.”

        I can’t wait to hear you “champion” those “business law” solutions to whatever “problem” you are imagining is presented by the facts in this case. Seriously. I’m on total pins and needles waiting for your super thoughtful take on the “business law” “solution” to the assertion of junk claims like the ones that were asserted here.

        1. You do realize what the parties (not me) actually did argue before the court here, right?

          Maybe you can contact counsel and ask them why they did not use your super dooper pet theory.

          1. Nobody could have predicted that “anon” would dissemble into his usual “you are aware?” horseshirt in lieu of an actual coherent explanation of his own baloney.

            I wonder what his insult wheel will come up with next? Oh, the suspense is killing me.

            1. You are the one chasing tangents and I merely remind you of what the parties actually discussed and you want to accuse me of dissembling…?

              Really?

              Wow.

              1. chasing tangents

                No, I’m waiting for you to tell us what the “better” “business law” “solutions” are to the problems presented when a bottom-feeder patentee like this one asserts junk claims against a content-provider.

                If you’re unwilling to explain your own statements to everybody, just say so. That shouldn’t be too hard. Heck, you can even copy and paste from this comment and that’ll save you some typing time.

                1. I copied an pasted from your earlier comment – but I guess showing explicitly why you are indeed on a tangent was just “a little too much.”

                  Let me leave you with a quote from the case. If you have issues not following the quote (that is, diving into a tangent), then address your concern directly to the quote and to the judges and the parties.

                  The only issue before us is patent exhaustion.

                  Try (again) to stay on point.

          2. This is an instance where my lack of legal training leads me to ask:

            Why wouldn’t/couldn’t the judge(s) just whack the patent(s) sua sponte based on the abstract nature of the claims?

            They would never need to get to the question of exhaustion….

            1. Why wouldn’t/couldn’t the judge(s) just whack the patent(s) sua sponte based on the abstract nature of the claims?

              At the time (back in 2012-13), the judge might have been confused by some even more confused folks on the Federal Circuit who told him that the claims couldn’t possibly cover abstract subject matter because you can drop a cell phone on your foot.

              In this instace, the judge was surely thinking that he/she didn’t need to “get to that question” because (he/she believed) the winning exhaustion defense rendered that question moot.

  5. I am not a huge believer in the technological arts test, but here’s a great example of why you would need it:

    This distinction here is important because the accused infringers are content providers and – apparently – the content claims do not require any proof that the handset acquirers are practicing any aspects of the claims.

    Then how do the claims have any utility? The patentee posits that the information would be transferred, but that has no value unless someone actually, you know, accesses the transferred information at some point. The only thing that gives the system any value is the very unclaimed item that the exhaustion doctrine turns upon. When you don’t have a technological test, bs like this can run rampant.

    In any case the claims are obvious over a newspaper and a limited time offer (and arguably the latter is superfluous) and invalid under 101 just the same.

    When you see this kind of stuff happen in the legal realm rather than the software realm, then we’ll see a lot of changes, I suppose. Imagine if someone could patent applying the same discovery steps one always applies but doing it to a claim brought under a new statute? I guarantee that gets past the office, because the argument is “this statute was passed on monday, this case was filed on tuesday, you won’t find an example of this being applied to this case” and apparently that works all the time ^^^

    The actual Alice training (rather than just the memo) went out last week, so hopefully this will change soon.

    1. Please point to the words of Congress where I can find this technological arts test…

      (then realize that any such “need” is not permission to violate the separation of powers doctrine)

      As far as your obviousness argument, you are doing that Gisting thing again…

      Lastly, your “when this happens in the legal realm” is a nonsense rhetorical ploy, to which the appropriate response is “Bite me.”

      1. Just for reference, here is a typical claim from these patents…

        1. A method of providing content to a cell phone comprising:

        a content provider causing the content to be stored in an internet accessible storage unit;

        the content provider initiating a page to a content subscriber, the page including a notification that: (i) identifies the content, and (ii) includes an address of a system to be contacted to trigger retrieval of the content, but does not include the content;

        wherein the page indicates that the content is available for a specified time; and

        the content provider causing the content identified by the notification to become inaccessible at the internet accessible storage unit after identified by the initiated page.

        1. Go,

          Once again, while polite, your cheerleading leaves a lot to be desired.

          How exactly does your “just for the reference” actually address any of the points I put on the table for discussion?

              1. Ok. For fun I’ll respond to your points even though they were made to someone else.

                1. There is no ‘technological arts’ test. As you well know, eligibility under 101 has been interpreted most recently by the SCOTUS in at least Bilski, Myriad, Mayo and Alice. These 4 cases do a pretty good job of summarizing eligibility. Contact MM if you have any questions about how these cases are applied = )

                2. As far as obviousness goes, it seems a prima facie case could be pretty easily made under at least 2143A (Combining prior art elements according to known methods to yield predictable results).

                It seems clear that everything in this claim was, individually, known in the prior art, The elements were combined using known techniques and the results were predictable.

                I’m open to be convinced otherwise.

                As to your third point, I agree, it was a rhetorical move.

      2. Please point to the words of Congress where I can find this technological arts test…

        Congress is subservient to a higher authority.

        As far as your obviousness argument, you are doing that Gisting thing again…

        I’ll make it simple then:

        a newspaper provider causes newspaper print to be stored on a paper;

        the newspaper provider delivers a copy to a subscriber, the page including (i) the name of the publication, and (ii) a page number which is used to refer to article locations;

        wherein the page indicates the date of printing;

        and the newspaper provider causing the article to become inaccessible by paper following the printing date by never printing that run again.

        I might cite a limited time sale just to bulk up the specified time and inaccessibility parts (a going out of business sale would be great here). The rest is implementation using known computer hardware (storage unit) and methods (programmed software).

        Then you point out that neither periodic publication nor time-limitations are even remotely new, and you see it’s just an application of them in the computer context.

        This isn’t very hard anon. I can’t tell whether you’re uneducated enough to not know what’s being described was totally obvious outside of the computer context, or whether you don’t understand the law makes it very easy to show obviousness IN the computer context given that.

      3. Hey, the Supreme Court has clearly been making up stuff that has no basis in the statute, so I don’t see why RandomGuy can’t suggest more things to make up.

    2. Random you are seeing the same problem with the Federal Circuit’s analysis that I am.

      Take Morgan Envelope. Assume three patents, one on the fixture, another on the paper roll, and a third on the combination, all of which are patentable because of feature X, let us say a kind of notch in the roll that cooperates with a pinion on the fixture.

      Assume further that the rolls can be used in conventional fixtures. Assume further that the fixtures can use conventional rolls. In either case, the combination does not practice the invention.

      Now if the patentee licenses all roll makers, and sues the fixture makers, don’t we really have Morgan Envelope?

      The patent on the fixtures would, its seems to me, have to have some distinct novelty rather than simply providing a pinion that works with the roll notch.

      1. Ned, I can’t follow your thought process here. In your first paragraph of your hypo you state that the patent on the fixture is “patentable of feature X” which is a pinion on the fixture. Then in your last paragraph you suggest that this “patentable” fixture isn’t patentable.

        I know it’s your hypo but it should at least be internally consistent! 😉

        1. MM, I am suggesting the the patent on the fixture needs to have some novelty other than the pinion. I am not suggesting the pinion patent is not patentable. I am suggesting that if the patentee licenses roll makers to use the notch, they cannot then sue fixture makers for using the pinion.

      2. Ned,

        I think Morgan Envelope is not on point. Specifically, here the patentee claimed X, Y and (presumably) X+Y=Z. If X is the content claims, Y is the handset claims, and then Z is the combination, Morgan Envelope would exhaust any infringement claim as to Y or Z. But not to X. At least that’s how I read it, and how the Fed. Cir. seems to have ruled.

        An interesting question to me though, is now that X has been determined to not require any handset (despite, e.g., the preamble requiring a handset) does that mean that the claims are anticipated/made obvious by any content prior art regardless of whether or not it relates to mobile devices? (putting aside that that sort of modification is surely obvious). That is, is the patentee now estopped from arguing that the fact that it is to a handset is an important part of the claim and could distinguish it over the prior art? The patentee successfully argued that no handset is needed or required by the claim. If that’s the case, I would argue that it is also not needed in the prior art to make an invalidity case.

          1. Oh I don’t necessarily disagree, and I think you’re on to something when you talk about what the invention actually is (rather than how it can be broken into distinct parts), and where the novelty actually comes in.

            What it comes down to to me though, is that if the novelty is in X+Y, then X or Y are in the prior art, and the claims on X or Y, standing alone, should never have been granted.

            This is why I think the patentee can now no longer argue that X+Y makes the claim patentable over the prior art. They’ve just successfully defeated the exhaustion argument based on arguing Y was not part of the invention. In sum, if I were the defendants in this case, I’d be pointing to websites from prior to 1997 that had links to information that changed daily (not hard when you think nytimes.com came out in 1996). That it’s on a mobile phone is necessarily irrelevant to the purported invention.

            1. Jane: That it’s on a mobile phone is necessarily irrelevant to the purported invention.

              This is true, by the way, to 99.99% of patent claims that recite “mobile” devices.

  6. One problem with the case that I see is that it relies on the non assertion by the PTO of obviousness-type double patenting rejections. I think such a non assertion only creates a rebuttable presumption, not a conclusive presumption.

    The NY Times might ask for a remand on rehearing for the lower court to consider this issue if it outcome determinative.

      1. anon, since the lack of obviousness-type rejections was outcome determinative, I would hope the Times argued that there was double-patenting in actual fact.

    1. Ned, although I don’t think it will get raised again in this case, I agree with you that an examiners failure to raise any double-patenting rejections, when the examiner should have, should have nothing to to do with the opposite situation covered by 35 USC 121 where an examiner requires a restriction an not create any assumptions. I should be treated in litigation like any other examiner failure to make rejections that should have been made.

    2. Ned, I agree that this part of the rationale [or dicta?] in this decision seems strange. It is clearly not a 35 USC 121 triggering situation when examiners simply fail to make obviousness type double patenting rejections that they should have. Why should that create legal presumptions any more than examiners failing to apply any other rejections that they should have applied?

      1. Also, the focus seems wrong. The question should be whether the same invention is involved in the two patents. This would requires more of a “novel feature” analysis. One can add to a novel feature a number of conventional elements and turn a handset patent into a content provider patent with a few strokes of the pen.

        1. Indeed, that is where judicial “obviousness type”double patenting differs from literal statutory double patenting. The MPEP spells that out.

  7. What I find most interesting is that the Federal Circuit is actually relying on Supreme Court authority of some vintage — not only here, but in a number of other recent cases. For example, UNITED ACCESS TECHNOLOGIES v. CENTURYTEL BROADBAND SERVICES link to cafc.uscourts.gov, a collateral estoppel case.

    The aside about the ’52 and ’11 acts is particularly interesting, as it opens the door, just a crack, to this court looking at the historic Supreme Court cases wherever intervening statutes did not intend to change the law.

    1. Your (glib) comment on the Hricik side of the blog concerning an area in which Congress very much DID indicate their intentions (as captured in the 1963-64 quote by Judge – and 1952 architect – Rich) as well as our past discussions on the 112 (and not just limited to 112(f)), regarding the opening up of the use of language sounding in functional terms (as shown by the words of Frederico) raises a very large red flag to me that you think that an unlimited use of such ‘vintage’ Supreme Court case quotes is perfectt acceptable when it remains NOT acceptable.

      I would then reject the thrust of your comment here.

      1. anon, my observation was limited to situations where congress did not intend to change the law. I assume you would agree that if congress did not intend to change the law, the law was unchanged.

        1. Ned,

          My reply focused on the fact that you (often) don’t see where that dividing line is – even when I point it out to you.

          If you did not have such a habit of ig noring the points given to you, I would not have made the comment about what I see as a red flag.

          Do you agree?

          1. Well, anon, the Supreme Court in Graham did note the debate about obviousness, and it held that the law was but a codification of their precedent except for the second clause.

            Since 103 is by its very terms limited to when the prior art does not disclose the invention in one reference, it is hard to imagine 103 having anything to do with patentable subject matter outside the context of prior art.

            The structure of the original 101 divided patentable subject matter and prior art into two distinct buckets. A claimed invention might be non obvious but still not be eligible subject matter. The converse is also true.

            1. Graham and “held”…?

              You are confusing and conflating holding and dicta again Ned.

              Another bad habit of yours in using the writings of the Court – as I have often noted.

              Point blank on this particular issue: don’t trust the slippery words (in dicta) of an addict clinging to authority that Congress had removed. Previously I have supplied the legislative history per the Cornell web site explaining that Congress would not give back to the Court (in 103) what it explicitly took away (in the pre-1952 single paragraph).

              And by the way, you have not yet addressed the glibness of your view in light of what the person who – without any doubt whatsoever – would best know (because he was the architect himself), that person being Judge Rich; and that view aligns with my view and quite frankly eliminates your view.

              1. Judge Rich/

                Given the incredible mess he created and his demonstrated ignorance of the fundamental issues inherent to any patent system, this guy’s opinions are worth less than squat.

            2. As for partitioning patent eligibility and patentability, I need no advice from you – I have spoken extensively on the matter – quite in fact, often correcting you when you conflate the two.

    2. I have to agree with Anon to the limited extent that reliance only on very old Sup. Ct. patent cases from ancient eras [in which the Sup. Ct. was also rejecting child labor laws, civil rights, or much of any other government regulation] is not necessarily a reliable guide to how courts will rule in the 21st Century.

  8. Interesting.

    I would take a different slant: this is not so much about patents and patent law as it is about business and the whole ‘freedom to contract’ paradigm.

    As per other “problem areas,” a solution would be better made in realms that affect all items and not just patents.

    Think all court activities and costs…
    Think all allowable business formation (shell companies and asset games)…
    Think all tax laws…

    So here too, the “real” game is the business paradigm of attempting to find the deepest reach into the consumer pocketbook. Not only patents or patented items are affected with this business paradigm, and the “better” solution may very well be found and championed in business law, where the statutory law aspects of patent law are not impugned.

    1. As per other “problem areas,” a solution would be better made in realms that affect all items and not just patents.

      Tell us what “solutions” you are proposing that Congress should make.

      Unless of course you don’t have any such “solutions”. It’s possible, I suppose (who can say how likely? it would be irresponsible to speculate) that you really just want to avoid dicussion about changes to patent law because you don’t want those changes to take place.

      the “better” solution may very well be found and championed in business law

      Tell us what you have in mind for “championing” in “business law.”

      1. Better yet, you take a first stab at these business laws, I will even take your watch at the edge of the field of rye and protect the children.

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