I told my elder teenage child about Syngenta’s pending copyright case against Willowood involving EPA-required fungicide labeling. Crouch, Copyright Labels and Scope of 271(g), Patently-O (June 1, 2020).
Her graphic response follows:
by Dennis Crouch
The Supreme Court is wrapping up its 2019-2020 term within the next couple of weeks. I’m expecting a decision in the trademark case of USPTO v. Booking.com during this time. [updated]. A second IP case to be decided is Google LLC v. Oracle America, Inc. (copyrightability and fair-use for programming language function calls). However, the court postponed oral arguments until next term (October 2020). In addition, the court’s actions suggest that it may dismiss the case on procedural right-to-jury-trial grounds. In particular, the court asked for additional briefing on the standard-of-review for a jury determination regarding fair use.
Prior to the end of June, the court is likely to rule on a number of patent-focused certiorari petitions:
In addition, petition-stage briefing is ongoing in a handful of patent cases.
by Dennis Crouch. NOTE – The patentee here is represented by my former law firm MBHB, including my mentors of mine Dan Boehnen & Grant Drutchas. MBHB is also a financial sponsor of Patently-O. That said, I have not had any communication with MBHB regarding this case.
British Telecom v. IAC/InteractiveCorp and Tinder, Inc. (Fed. Cir. 2020)
In a short nonprecedential decision, the Federal Circuit has again affirmed a FRCP 12(b)(6) dismissal of an infringement lawsuit based upon a finding that the patent improperly claims an abstract idea. The district court decision was written by Federal Circuit Judge Bryson sitting by designation.
Here, the claims walk through a step-by-step method of using a user’s geo-location to match the user with a short-list of relevant information sources and push those out to the user’s device. U.S. Pat. No. 6,397,040 (1997 priority date).
Steps in claim 1:
A telecommunications system server (i) proactively tracking each individual user, (ii) accessing location data to determine geo-relevant information sources; (iii) dynamically developing a shortlist of information sources that the server deemed relevant to a specific user based on both the user’s geographical location and other personalized factors, and (iv) then pushing that shortlist out to the user.
On appeal, the Federal Circuit found the claims generally directed to providing location-specific information to users — an abstract idea.
We have previously held that tailoring the provision of information to a user’s characteristics, such as location, is an abstract idea.
The court went on to hold that that the claims added nothing new — an inventive step — to take claim 1 across the patent eligibility threshold. Here, the court only indicates that the claims recite “generic computer hardware.” The court focused only on the tech hardware and court did not particularly reference the patentee’s arguments of dynamic individualized user tracking and new techniques of combining data.
Non-Asserted Claims: In the case, the defendants challenged all 44 claims in the patent, but only discussed claim 1. The district court found all 44 ineligible – writing without further discussion that its analysis of claim 1 “applies equally to all claims of the ’040 Patent.” On appeal, the Federal Circuit affirmed, explaining that:
Because British Telecom did not present any “meaningful argument for the distinctive significance of any claim limitation” not found in claim 1, the district court did not err in finding that British Telecom had forfeited its ability to argue that other claims are separately patent eligible.
Slip Op. Quoting Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018). The odd aspect of the court’s citation of Berkheimer is that the patentee had relied upon the same portion of Berkheimer for its argument that claim 1 cannot simply be assumed to be a representative claim if the patentee argues that limitations in the other claims “bear on patent eligibility and never agreed to make claim 1 representative.” Berkheimer.
= = = =
Note that the district court dismissed this portion of the action and issued final judgment with respect to the ‘040 patent. The case is ongoing, however, with respect to other asserted patents.
Bozeman Financial LLC v. Federal Reserve Bank (Fed. Cir. 2020)
The Federal Circuit has denied Bozeman’s petition for en banc rehearing in this case – confirming the holding that the Federal Reserve Banks are permitted to petition the PTO for inter partes review proceedings despite the Supreme Court’s decision in Return Mail barring the US Postal Service (USPS) from taking such action.
The AIA indicates that any “person” other than the patentee can petition for inter partes review (IPR). However, in Return Mail, the Supreme Court held that the U.S. Gov’t does not qualify as a “person” under the statute and thus cannot files such petitions. Since USPS is a branch of the US Gov’t, its petition was improperly filed.
The distinction in Bozeman is that the Federal Reserve banks are not actually governmental institutions but rather a set of somewhat independent banks. Of course, the various Federal Reserve banks are substantially controlled by the Board of Governors, which is more appropriately termed a branch of the US Government.
The Chartered Institute of Patent Attorneys (CIPA) is the professional organization of UK Patent attorneys. The organization has released a new discussion paper on invention without the inventor.
Although the current debate is captioned around artificial intelligence (AI) systems, a real underlying focal point is a mechanism to allow for immediate and automatic corporate ownership:
Many in CIPA think patent rights should be available for inventions which represent new, non-obvious technical developments, regardless of how they were created (with or without an AI system).
Others in CIPA prefer to limit patent protection to inventions having a human contribution – in effect, retaining current inventorship requirements, but accepting that an invention created using AI is patentable as long as there is a genuine human contribution.
by Dennis Crouch
Patent settlement agreements often include a no-challenge clauses — where the accused infringer promises to never (again) challenge the validity of the asserted patents. Courts have done a slow about face on the notion of licensees challenging the validity of a licensed patent. In 1905, Licensee Estoppel was the general rule. That rule was slowly eroded until finally eliminated in Lear, Inc. v. Adkins, 395 U.S. 653, 670 (1969). Later, in MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007), the Supreme Court opened the door to provide a licensee in good standing easier access to the courts. Still, question remained whether explicit no challenge clauses would be enforceable; especially when done in the context of settling litigation. (Some licenses also included termination clauses if validity was challenged). Effectively what happened is that pre-1982 the various circuit courts extended Lear, but the Federal Circuit altered course. See Flex-Foot, Inc. v. CRP, Inc., 238 F.3d 1362 (Fed. Cir. 2001); compare Rates Tech. Inc. v. Speakeasy, Inc., 685 F.3d 163 (2d Cir. 2012) (no-challenge term in settlement agreement was void for public policy reasons).
A new decision in this area is Transocean Offshore Deepwater Drilling Inc. v. Noble Corp. Plc, 4:17-CV-123, 2020 WL 1666119 (S.D. Tex. Apr. 2, 2020). In a first lawsuit, Transocean sued Noble for patent infringement and the parties agreed to a license agreement with a “no-challenge promise” as follows:
Noble Licensee covenants that it will not participate as a party or financially support a third party in any administrative or court proceeding or effort in the world to invalidate, oppose, nullify, reexamine, reissue or otherwise challenge the validity, enforceability, or scope of any claim of the Licensed Patents. Breach of this section 4.3 shall be considered a material breach which may not be cured.
Id. Later, Transocean sued Noble again for infringement – different acts of infringement, but the same patents. In that litigation Noble apparently did not challenge the patent’s validity or enforceability. However, Noble arguably did challenge the “scope” of the claims — attempting to limit the scope during claim construction proceedings.
Applying Flex Foot, the Texas District Court found the clause enforceable — jas a “clear and unambiguous waiver.”
Here, Transocean and Noble settled a patent infringement lawsuit involving the patents-in-suit by entering into the license agreement. In the license agreement’s no-challenge clause, Noble agreed that “it w[ould] not participate as a party or financially support a third party in any administrative or court proceeding or effort in the world to… challenge the…scope of any claim of the [patents-in-suit]” Under Diversey and Flex-Foot, the no-challenge clause is clear and unambiguous enough to waive future challenges to the scope of any claim of the patents-in-suit.
Id. The court then left open the actual meaning of the contract — in particular, what does it mean to “challenge the scope of any claim?”
Willowood, LLC v. Syngenta Crop Protection, LLC, Docket No. 19-1147 (Supreme Court 2020)
Syngenta sued Willowood for both patent and copyright infringement associated with its generic fungicide compound. Willowood won at the district court, but that holding was overturned on appeal. Now Willowood is bringing it to the Supreme Court.
The copyright claim: Syngenta product “labels” have many pages of small-type that were registered with the US Copyright office. Willowood apparently copied the labels for its competing generic product. Because the fungicides are dangerous chemicals, these labels are required in order to sell the product.
The district court dismissed the copyright claims — holding that the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”) precludes the copyright claim because FIFRA requires a generic product to use “identical or substantially similar” labels that are typically mandated by EPA regulations. On appeal, the Federal Circuit vacated — holding that statute does not allow thoughtless copying since “the text of FIFRA does not, on its face, require a me-too registrant to copy the label of a registered product.” Rather, according to the court, the court must look at each copyrightable element of Syngenta’s label and consider whether that portion is “necessary” for the generic approval process.
In its petition for certiorari, Willowood asks for a blanket rule:
Whether, by requiring the EPA to grant expedited review and approval of labels for generic pesticides that are “identical or substantially similar” to the previously approved labels for the same product, Congress intended to preclude claims of copyright infringement with respect to generic pesticide labels.
Question presented in Petition for Certiorari. This portion of the case could be a nice companion case to Google v. Oracle if certiorari is granted there.
The Patent Claims: A portion of the infringement case turned on the court’s interpretation of 35 U.S.C. 271(g).
(g) Whoever without authority imports into the United States … a product which is made by a process patented in the United States shall be liable as an infringer, if the importation, offer to sell, sale, or use of the product occurs during the term of such process patent.
The district court ruled found no infringement because the product was purchased from a separate entity and that the single-infringer-rule requires “every step of a claimed process to be performed or attributable to a single entity.”
On appeal, the Federal Circuit also rejected this statement of the law — holding that importation is the act of infringement under 271(g) (or sale/offer). The statute does not require that the accused infringer be the one performed the method.
This [statutory] language makes clear that the acts that give rise to liability under § 271(g) are the importation, offer for sale, sale, or use within this country of a product that was made by a process patented in the United States. Nothing in this statutory language suggests that liability arises from practicing the patented process abroad. Rather, the focus is only on acts with respect to products resulting from the patented process. Thus, because the statutory language as a whole is clear that practicing a patented process abroad cannot create liability under § 271(g), whether that process is practiced by a single entity is immaterial to the infringement analysis under that section.
Syngenta Crop Protec., LLC v. Willowood, LLC, 944 F.3d 1344, 1359–60 (Fed. Cir. 2019). In its petitition, Willowood asks that the Supreme Court step-in here as well:
Whether liability for patent infringement under 35 U.S.C. § 271(g) requires that all steps of a patented process must be practiced by, or at least attributable to, a single entity, a requirement that the Supreme Court previously recognized is a prerequisite for infringement under 35 U.S.C. §§ 271(a) and (b) in Limelight Networks Inc. v. Akamai Technologies Inc.
Recent Headlines in the IP World:
Commentary and Journal Articles:
New Job Postings on Patently-O:
Recent Headlines in the IP World:
Commentary and Journal Articles:
New Job Postings on Patently-O:
By David Hricik, Mercer Law School
The USPTO is seeking comments on amending certain PTAB Rules of Practice. While it proposes many amendments, two seem key: one for instituting on all challenged claims and grounds (to conform with SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018)) and the other to eliminate the presumption at institution favoring the petition as to testimonial evidence. Comments will be accepted through June 26, and the notice is available here.
As to the first major proposal, as amended the PTAB will institute an IPR, PGR, or CBM proceeding on all claims and all grounds if preponderant evidence in the petition shows at least one claim is unpatentable. The Office explained in part:
In light of SAS, the Office provided guidance that, if the Board institutes a trial under 35 U.S.C. 314 or 324, the Board will institute on all claims and all grounds included in a petition of an IPR, PGR, or CBM. To implement this practice in the regulation, the first proposed change would amend the rules of practice for instituting an IPR, PGR, or CBM to require institution on all challenged claims (and all of the grounds) presented in a petition or on none. Under the amended rule, in all pending IPR, PGR, and CBM proceedings before the Office, the Board would either institute review on all of the challenged claims and grounds of unpatentability presented in the petition or deny the petition.
As to the second, the USPTO spent a lot more ink explaining it, writing in part:
In April 2016, after receiving comments from the public and carefully reviewing them, the Office promulgated a rule to allow new testimonial evidence to be submitted with a patent owner’s preliminary response. Amendments to Rules of Practice for Trials Before the Patent Trial and Appeal Board, 81 FR 18750 (April 1, 2016). The Office also amended the rules to provide a presumption in favor of the petitioner for a genuine issue of material fact created by such testimonial evidence solely for purposes of deciding whether to institute an IPR, PGR, or CBM review. Id. at 18755–57.
Stakeholder feedback received in party and amicus briefing as part of the Precedential Opinion Panel (POP) review in Hulu, LLC v. Sound View Innovations, LLC, Case IPR2018–01039, Paper 15 (PTAB Apr. 3, 2019) (granting POP review), indicated that the rule has caused some confusion at the institution stage for AIA proceedings. For example, certain stakeholders have indicated that the presumption in favor of the petitioner for genuine issues of material fact created by patent owner testimonial evidence also creates a presumption in favor of the petitioner for questions relating to whether a document is a printed publication. Additionally, the Office has concerns that the presumption in favor of the petitioner may be viewed as discouraging patent owners from filing testimonial evidence with their preliminary responses, as some patent owners believe that such testimony will not be given any weight at the time of institution.
Section 314(a) of 35 U.S.C. provides that ‘‘[t]he Director may not authorize an inter partes review to be instituted unless the Director determines that the information presented in the petition. . . and any response . . . shows that there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.’’ 35 U.S.C. 314(a). Thus, the statute provides that a petitioner is required to present evidence and arguments sufficient to show that it is reasonably likely that it will prevail in showing the unpatentability of the challenged claims. Hulu, LLC v. Sound View Innovations LLC, Case IPR2018– 01039, Paper 29 at 12–13 (PTAB Dec. 20, 2019) (citing 35 U.S.C. 312(a)(3), 314(a)). For a post-grant review proceeding, the standard for institution is whether it is ‘‘more likely than not’’ that the petitioner would prevail at trial. See 35 U.S.C. 324(a). In determining whether the information presented in the petition meets the standard for institution, the PTAB considers the totality of the evidence currently in the record. See Hulu, Paper 29 at 3, 19.
In this notice of proposed rulemaking, the Office proposes to amend the rules of practice to eliminate the presumption in favor of the petitioner for a genuine issue of material fact created by testimonial evidence submitted with a patent owner’s preliminary response when deciding whether to institute an IPR, PGR, or CBM review. Thus, consistent with the statutory framework, any testimonial evidence submitted with a patent owner’s preliminary response will be taken into account as part of the totality of the evidence.
Interestingly, the Office specifically asked for input as to implementation, stating “the Office may apply any rule changes, if adopted, to all pending IPR, PGR, and CBM proceedings in which a patent owner’s preliminary response is filed on or after the effective date.”
By Jason Rantanen
Odyssey Logistics and Technology Corporation v. Iancu (Fed. Cir. 2020) Download opinion
Panel: Lourie, Reyna and Hughes (author)
Some of my biggest head-scratchers when I studied administrative law in law school were the timing rules for bringing challenges under the Administrative Procedures Act. It wasn’t because of a lack of comprehension, but instead due to the way these rules can block off judicial review of agency action. Individually the timing rules make sense, but collectively they produce a Three Bears-type situation: the timing of challenges has to be just right, or the challenge will get tossed for being either too early or too late.
This case involves two challenges to actions taken by the PTO and one challenge to a set of rules published by the PTO in 2011. The first two challenges were dismissed as two early and the third was too late.
Count I involved a request for rehearing by the relevant Technology Center Director following the Patent Trial and Appeal Board’s (PTAB) reversal of the examiner’s objections to Odyssey’s application. The request for rehearing was filed about five months after the PTAB decision. Odyssey challenged the propriety of the request on procedural grounds at the PTO, which were rebuffed, and then filed a challenge in the Eastern District of Virginia before the PTAB issued its decision on the substantive merits raised by the rehearing. The Federal Circuit affirmed the district court’s holding that there was not yet a “final agency action” under the APA. Nor did the Federal Circuit see this as a situation involving an abusive use of agency rules to delay proceedings that justified compelled action by the court.
In Count II, Odyssey challenged what it argued were new grounds for rejection by the examiner. However, the PTAB had not yet issued a decision at the time Odyssey brought the challenge. The result: dismissal for non-finality. Odyssey argued that the district court should have instead dismissed on mootness grounds, but the Federal Circuit said that wasn’t necessary: “[A] federal court has leeway to choose among threshold grounds for denying audience to a case on the merits….The district court did not err by “tak[ing] the less burden-some course.” Slip Op. at 11.
The final count was a challenge to certain amendments that the PTO made to its rules on practice for ex parte appeals in 2011. Odyssey argued that these amendments were facially invalid–that the regulations were unlawful generally. However, 28 U.S.C. § 2401 bars claims that are not brought within 6 years of the date the action accrues. Odyssey argued that the relevant triggering date was the effective date of the regulation (January 23, 2012) rather than the date it was published in the Federal Register (November 22, 2011), but the Federal Circuit disagreed: under both Fourth and Federal Circuit law, the relevant date for substantive facial challenges is the date of publication. Substantive facial challenges are different from “as applied” challenges, which accrue as of “the time of an adverse application of the decision against the plaintiff.” Id. at 13, quoting Hyatt v. U.S. Pat. & Trademark Off., 904 F.3d 1361, 1372 (Fed. Cir. 2018). The result was that Odyssey’s challenge, which was filed in district court on January 23, 2018, was time-barred by § 2401.
Edit: Shortly after I posted this, counsel for appellant contacted me to inform me that the statement “Odyssey challenged the propriety of the request on procedural grounds at the PTO, but then filed a challenge in the Eastern District of Virginia before the PTAB ruled on the request for rehearing” was incorrect: in fact, the lawsuit was filed after the petition for rehearing was granted but before the PTAB had issued a decision on the merits on the substantive issues raised by the rehearing. I’ve changed the above post to specifically refer to the “decision on the substantive merits raised by the rehearing.” I also made a few other edits to clarify the issue raised in Count I.
by Dennis Crouch
The Chamberlain Group, Inc. v. Techtronic Indus. Co. (Supreme Court 2020)
Chamberlain Group’s asserted patent claims a garage-door-opener (claim 1, 5) and an associated method (claim 15). US7224275.
Garage doors and opening mechanisms have been the subject of patents for 150 years. Back in 1919 Lee Hynes filed an early patent on electric-controller for a car door operating mechanism. Despite this long history, the Federal Circuit found Chamberlain’s patent ineligible under 35 U.S.C. 101 as directed to an abstract idea.
By the time this patent application was filed, all three of these elements were all “generally well understood in the art.” The innovative feature of the claims is that the system is designed to transmit the door’s “present operational status” — i.e., is it moving up; moving down; reversing; blocked; etc. The signal also includes a “relatively unique” identifier for folks with multiple garage doors so that the unclaimed receiver can tell which door is up/down. Note here that there is nothing new about these various status points — the only difference is that it that the signals are being sent, and being sent wirelessly.
So, although the patent claims a garage-door-opener including various physical components, the point-of-novelty is that a particular signal is being sent wirelessly. In its decision, the Federal Circuit found the wireless transmission of status to be an abstract idea: “the broad concept of communicating information wirelessly, without more, is
an abstract idea.” One Alice Step 2, the court held that the claims did not include any inventive concept beyond the excluded abstract idea:
In other words, beyond the idea of wirelessly communicating status information about a movable barrier operator, what elements in the claim may be regarded as the “inventive concept”?
[W]ireless transmission is the only aspect of the claims that CGI points to as allegedly inventive over the prior art. . . . Wireless communication cannot be an inventive concept here, because it is the abstract idea that the claims are directed to. Because CGI does not point to any inventive concept present in the ordered combination of elements beyond the act of wireless communication, we find that no inventive concept exists in the asserted claims sufficient to transform the abstract idea of communicating status information about a system into a patent-eligible application of that idea.
The new petition has two focal points (1) whether eligibility should be seen as a “narrow exception;” and (2) whether the Federal Circuit errs in its approach of separating the claim into various components and excluding the abstract idea portion from the claim when considering Alice Step 2.
Whether the Federal Circuit improperly expanded § 101’s narrow implicit exceptions by failing to properly assess Chamberlain’s claims “as a whole,” where the claims recite an improvement to a machine and leave ample room for other inventors to apply any underlying abstract principles in different ways.
Chamberlain Petition. The petition also repeats the refrain of unsettling uncertainty:
The root cause of all this ire and uncertainty is the Federal Circuit’s insistence once again on crafting an elaborate test that strays from—and here, contradicts—the plain text of the Act.
The petition ends with a call for immediate action — calling out the current situation as “a patent emergency.” The breadth of eligibility challenges are shifting innovator behavior:
[T]here is no time. Innovators are adapting their behavior right now to the Federal Circuit’s new patent-hostile regime. Investors are deciding now to withhold investments they would have made before the Federal Circuit changed the law. Waiting any longer to intervene could inflict irreparable harm on U.S. industry.
Techtronic has already waived its right to respond to the petition — meaning that the Supreme Court may act on the petition before the close of its current session in June.
Guest Post by Colleen V. Chien and Evan Hastings, Santa Clara University School of Law*
The COVID pandemic has created an urgent need for innovation to protect against, treat, test for, and eventually, inoculate against the virus. To save time and lives requires collaboration, making it an opportune time to strengthen the capacity of the patent system, as one part of the much larger innovation ecosystem, to coordinate and include, among multiple innovators, not only to protect and exclude.
A few years ago, one of us wrote a pair of articles about the importance of contextual patent disclosure (meaning information about, for example, patent ownership, licenses and pledges, and government interests in patented innovation) for open innovation and argued for greater investments and attention to such non-traditional forms of “patent disclosure.” During the COVID crisis, the demand for just this sort of contextual information – most recently by Reps. Lloyd Doggett and Rosa DeLauro, who have asked Gilead for a detailed breakdown of remdesivir patents, applications, and licenses supported with government funding – underscores its usefulness for government accountability as well, especially as the US government commits billions of dollars (some of which is already bearing fruit) to fund COVID innovation. Contextual information can also facilitate voluntary licensing, a market-based “third” way in the access v. innovation debate.
The USPTO’s recently-launched Patents 4 Partnerships platform, the US-based Open Covid Pledge, and Japan-based Open Covid-19 Declaration represent important efforts to provide contextual information about patent owner intents (to share and license technology) to the public. These efforts, as well as others to provide immunity to makers of personal protective equipment (PPE) and supplies are profiled below. Building on previous work, here are several other steps that could bolster collaborative innovation and patent disclosure, on coronavirus and in general. Many could be taken by the USPTO and other agencies as executive actions and do not require Congressional authority:
Like the initiatives described below, these steps would help unify a fragmented, noisy landscape of innovation information supporting open innovation within, not outside of, the existing patent system.
Open Covid Patent Pledge / Covid-19 Declaration
Adoptees of the US-based Open Covid Pledge, created by Professors Jorge Contreras, Mark Lemley, and others, promise to share their patents and related intellectual property on non-exclusive, royalty-free, worldwide terms for the purpose of ending the COVID pandemic. To do so, an adoptee makes a public announcement of intent and then implements one of the three licenses, all of which grant rights to patent and regulatory exclusivities until one year after the WHO declares the end of the pandemic or Jan 1, 2023, whichever comes earlier or a compatible variant and notifies the Pledge. Nearly 20 companies, including tech giants Microsoft and IBM have signed on, with details about each company’s commitment linked to from the Pledge website. Most members have provided access to their entire patent portfolio; while others have instead pledged a particular technology, such as the New Jersey Institute of Technology, or copyrights, like Skopos Labs. Over twenty of Japan’s major corporations have made a similar commitment to not assert some 300,000 patents through the Open Covid-19 Declaration, including two leading suppliers of COVID tests, LSI Medience and SRL Inc, and Teijin Limited, a Japanese pharmaceutical and information technology company. IAM has reported that the initiative, led by Canon, has reached out to thousands of Japanese companies and intends to expand to companies in China and Korea as well. Though no contract is ever signed, the pledges rely on estoppel and implied license theories for enforceability. For an analysis under US law, see Pledge Co-founder and Creative Commons GC Diane Peters’ whitepaper.
With permissions secured, the next question is how to find technologically relevant IP. The lightweight nature of the Open Covid Pledge makes it, as founder Jorge Contreras has described, “a start” at doing so. Innovators can use traditional search tools, but without context, in particular reliable assignee or product information, may be hard-pressed to find relevant technology. A few pledging companies have supplied some contextual disclosure – Hewlett Packard Enterprises, for example, has highlighted the use of wifi technologies to create a floating hospital in Italy and Sandia National Labs has a search database that is broken down by technology – but the task of finding relevant, safe-from-suit technology remains with the innovator. Due to these features, the Open Covid Pledge is likely to serve primarily as a useful non-assertion covenant that helps to clear the path for innovation, at least until Jan 1, 2023.
Patents 4 Partnerships
While the Open Covid Pledge and Non-Assertion Declaration described above provide freedom to operate in view of hundreds of thousands of patents, the USPTO’s recently launched Patents 4 Partnerships platform makes it easier for potential technology partners to find one another, as one of us previously called for. It does so by enabling patentees to indicate, and enabling the public to discover, the availability of technology for licensing, currently of about ~200 assets. Director Iancu described the platform as “a meeting place that enables patent owners who want to license their IP rights to connect with the individuals and businesses who can turn those rights into solutions for our health and wellbeing.” In this initial launch, the platform includes a searchable repository of patents and published patent applications related to the COVID-19 pandemic available for licensing. In the future, the USPTO intends to consider expanding to other areas of technology.
Platform listings link to license information pages such as this one; most patent assets have been filed within the past 5 years. Currently, the majority of available listings are from universities and federal labs such as the Federal Laboratory Consortium for Technology Transfer, the AUTM Innovation Marketplace, the National Institutes of Health, NASA, and other government agencies. Neither the idea of hastening commercialization of government inventions, nor the idea of a licensing registry are new. Several years ago, the World Intellectual Property Organization established a marketplace for green technologies called WIPO Green. In 2008, the Eco-Patent Commons was established to facilitate green technology transfer from firms pledging their technology. Unfortunately, the Common was shut down in 2016 with Professors Bronwyn Hall and Christian Helmers finding no evidence that it increased the diffusion of pledged innovation. A 2019 study in the Houston Law Review by the authors and Professor Jorge Contreras based on numerous interviews identified several structural issues, providing an excellent background read for designers of licensing or pledge platforms seeking to learn from the past. One concrete step would be to ensure that there is a mechanism for tracking usage, to drive iteration and improvement. IP owners are encouraged to submit via a form technologies related to COVID-19 that are available for licensing.
Good Samaritan and Other Immunities
The maker movement has made extraordinary contributions to the COVID response. Timothy Kroninger and Edward H. Rice suggest that good samaritan law, stemming from “public necessity” doctrine, can immunize makers from claims of infringement during the COVID crisis due to the imminent need for medical supplies. Additionally, attorneys from Arnold & Porter have identified the Public Readiness and Emergency Preparedness (PREP) Act and Defense Production Act (DPA) as the source of several, limited regulatory immunities for innovators. These cover approved and unapproved medical supplies made for emergency use, and government contractors for any act or failure to act resulting directly or indirectly from compliance with a rule, regulation, or order, respectfully.
As innovators around the world rise to the challenge of collaboratively finding Covid solutions, the
Patents 4 Partnerships platform, Open Covid Pledge, and Open Covid-19 Declaration demonstrate the clarifying and coordinating informational role the patent system can also play. Four additional steps that deserve consideration during this unprecedented moment include: encouraging early publication; improved reporting of government interests, inventors and patent owners; consolidating patent-product data; and enabling and federating license, pledge and other contextual patent disclosures. Such investments in contextual patent information, like the Patents 4 Partnerships platform, can help accelerate not only Covid innovation, but open innovation in general.
*Evan Hasting is a Graduate Fellow and 2019 graduate of Santa Clara School of Law, and Colleen V. Chien is a Professor at Santa Clara University School of Law.
 Professor Lisa Ouellette’s Written Description blog is providing excellent coverage of innovation developments related to COVID by a team of Professors including, in addition to Professor Ouellette, Jake Sherkow, Rachel Sachs, and Nicholson Price.
 Colleen V. Chien, Contextualizing Patent Disclosure, 69 Vand. L. Rev. 1849 (2016); and Colleen V. Chien, Opening the Patent System Diffusionary Levers in Patent Law, 89 S. Cal. L. Rev. 793 (2016).
 It appears that this site http://www.iproduct.io/data by Professor Gaétan de Rassenfosse will at some point release such a database, at this point, it says, “the data will be released as the underlying papers get published.”
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by Dennis Crouch
McRO, Inc. (Planet Blue) v. Bandai Namco Games (Fed. Cir. 2020)
This case has returned to the Federal Circuit. In 2016, the court issued an important legibility decision in the case — finding the algorithm for syncing anime lip-movements with various sounds to be patent eligible. McRO, Inc. v. Bandai Namco Games America Inc., 837 F.3d 1299 (Fed. Cir. 2016) (McRO I). Less than four years later, McRO I has been cited by over 2000 PTAB decisions as well as 200+ court decisions. The only more-cited patent cases from 2016 are Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016); Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131 (2016); and Electric Power Group, LLC v. Alstom S.A., 830 F.3d 1350 (Fed. Cir. 2016).
On remand, the accused infringers again successfully moved for dismissal — this time on summary judgment of invalidity (enablement) and non-infringement. On appeal, the Federal Circuit has vacated the invalidity holding, but upheld the non-infringement determination.
Non-Enablement and Point of Novelty: Aspects of the invention that are known in the art need not be fully described. Rather, the law relies upon the artisanal knowledge to fill the gaps. A “patent need not teach, and preferably omits, what is well known in the art.” AK Steele (Fed. Cir. 2003). However, novel aspects of the invention must be enabled – and must reasonably teach how to make and use that aspect of the invention.
Non-Enablement by Example: Enablement requires that the patentee “teach the public how ‘to practice the full scope of the claimed invention.'” without undue experimentation. Slip Op. quoting AK Steele. In a number of cases, the courts have invalidated patents on enablement grounds after identifying infringing products/processes that are not enabled. On appeal here, the Federal Circuit offered a limiting principle to that approach — it must be tied to a particular and actual product/process, not simply “an abstract assertion of breadth.”
In the case, the accused infringers identified two particular techniques that were not enabled (“bones” and BALDI). However, a narrow claim construction meant that neither of those were actually covered by the claims. And, only the claimed invention need be enabled.
No other concretely identified animation techniques have been advanced to support the district court’s and Developers’ enablement analyses.
Slip Op. Without any other particular example of infringing but non-enabled activity, the court held that theory of enablement failed. The district court noted the breadth of the claims and narrowness of the specification. On appeal, the Federal Circuit found that conclusion suggestive of an enablement problem, but insufficient:
[T]hese observations merely state the conclusion that the claims are too broad and the specification’s discussion is too narrow. The observations do not justify the conclusion with any concrete support. To say that the “first set of rules” limitation is broader than “if . . . then . . . else” statements based on keyframes is not to say what else is or may be within the phrase—and it was the burden of the Developers, not McRO, to prove that such specific content exists and that it is not enabled.
The appellate panel does not delve into this, but remember that enablement is a question of law, not a question of fact. The result then is that the defendant has the burden of persuading the judge on enablement, not proving its case. Lack of enablement can be supported by various factual conclusions, and those must be proven with clear and convincing evidence.
Non-Infringement: McRO’s non-infringement argument hinged upon claim construction of the claim term “morph weight set.” The morph weights identify how much and in what direction various morph targets (such as lip portions) move. The district court interpreted the term to require these be in 3-D geometric vector form. The result of that claim construction was no-infringement because the accused infringers “do not represent the displacements of each vertex in terms of a simple xyz displacement vector.”
On appeal, the Federal Circuit affirmed the claim construction — holding that “the specification compels the three-dimensional geometric construction of ‘vector’ adopted by the district court.” McRO had argued that vector should be given a broader definition to include how it is used in computer science — as a sequential list of numbers.
U.S. Patent No. 6,611,278 (“Method for automatically animating lip synchronization and facial expression of animated characters”).
by Dennis Crouch
Esip Series 2, LLC v. Puhzen Life USA, LLC (Fed. Cir. 2020)
In its decision here, the Federal Circuit has applied Thryv, Inc v. Click-To-Call Techs., LP, 140 S. Ct. 1367 (2020) and refused to consider whether the USPTO erred in its real-party-in-interest analysis.
In Cuozzo (2016), the Supreme Court held that this Court is precluded from reviewing Board decisions concerning the “particularity” requirement under § 312(a)(3). The Court explained that § 314(d) bars appellate review of “questions that are closely tied to the application and interpretation of statutes related to the Patent Office’s decision to initiate inter partes review.” The Court further explained that “where a patent holder grounds its claim in a statute closely related to that decision to institute inter partes review, § 314(d) bars judicial review.”
[I]n Thryv (2020) … the Supreme Court held that § 314(d) also precludes judicial review of the agency’s decision whether to apply the one-year time bar set forth in § 315(b)). . . .
In view of Cuozzo and Click-to-Call, we find no principled reason why preclusion of judicial review under § 314(d) would not extend to a Board decision concerning the “real parties in interest” requirement of § 312(a)(2). ESIP’s contention that the Board failed to comply with § 312(a)(2) is “a contention that the agency should have refused to institute an inter partes review.” Indeed, ESIP expressly argues that the agency should have refused to institute inter partes review because of Puzhen’s failure to identify all “real parties in interest.”
Slip Op. Here, the statute requires that a petition for inter partes review “may be considered only if” the petition identifies all real-parties-in-interest. In the case, ESIP argued that doTERRA should be considered a real-party-in-interest because the company is a co-defendant in the underlying litigation, sells the accused Puhzen product, and agreed to be bound by the IPR estoppel. The Board’s approach to the issue will stand without considering whether it is in accordance with the law.
Thryv was released after briefing and oral arguments had been complete. The court did accept the supplemental authority, but those are severely limited. In its statement to the court, patentee ESIP argued that it wasn’t (only) appealing the institution decision but rather (also) whether the petition met the statutory requirements: “[We] contend that Puzhen’s IPR Petition did not satisfy the statutory requirement in 35 U.S.C. § 312(a)(2).”
= = = =
On the underlying merits, the Federal Circuit affirmed the PTAB’s obviousness final decision regarding the claimed “method for introducing a scent into breathable air,” US9415130; IPR2017-02197.
Recent Headlines in the IP World:
Commentary and Journal Articles:
New Job Postings on Patently-O:
Alfred E. Mann Foundation & Advanced Bionics v. Cochlear Corporation, Docket No. 19-01201 (Fed. Cir. 2020). This case involves a $268 million damage award that the Federal Circuit affirmed on appeal in no-opinion R.36 judgment. The appeal focused on the damages calculations associated with Mann’s patented cochlear implant testing system. U.S. Patent Nos. 5,609,616 and 5,938,691. Following the R.36 affirmance, Cochelar then petitioned for en banc rehearing that has now also been denied (again without opinion).
The petition delves into the patent damages ‘book of wisdom.’ With the ‘book of wisdom’ courts recognize that the their judgment of the ‘hypothetical negotiation’ could be informed by post-infringement information that may reveal the underlying state of affairs at the time of infringement. The Supreme Court first explained its use of the term in Sinclair Refining Co. v. Jenkins Petroleum Process Co., 289 U.S. 689 (1933):
… if years have gone by before the evidence is offered. Experience is then available to correct uncertain prophecy. Here is a book of wisdom that courts may not neglect. We find no rule of law that sets a clasp upon its pages, and forbids us to look within.
Id. Mann, the district court relied upon post-infringement stock-prices of the patentee to help calculate the reasonable royalty, the the defendant argued that was improper (not to mention that the particular price chosen was improperly cherry picked). Over the course of six years, Advanced Bionics’ stock price rose from $2.80 to $100+, and that rise was seen as a measure of the value of the patented invention.
Petition. I expect to see a Supreme Court petition coming in the case over the summer.
by Dennis Crouch
Lucky Brand Dungarees, Inc. v. Marcel Fashions Group, Inc. (Supreme Court 2020)
This case makes me sad because it reminds me that my walk-able grocery store, Lucky’s Market, has closed down. Colorado based Lucky’s had its own trademark dispute with California based Lucky Supermarket.
The case before the supreme court involved two other uses of LUCKY:
The petition before the U.S. Supreme Court involves “defense preclusion” –asking when a defendant in a subsequent action will be precluded from raising a defense that was or could-have been raised in the prior action. In its decision, the Supreme Court explained that there is no special doctrine of defense preclusion, but rather the courts should apply the general rules of claim preclusion and issue preclusion.
The first litigation ended in a settlement. During the second litigation, Lucky Brand raised the prior settlement as a reason to dismiss, but the court denied the motion-to-dismiss without prejudice (thus not “on the merits”). The second litigation was then decided on other grounds. In the third litigation Lucky Brand again raised the prior settlement as a defense, and Marcel argued that it was precluded. In its analysis, the Supreme Court focused on whether the third litigation involved the “same claim” as the second; and whether it mattered.
Claim preclusion bars relititgation of an already decided claim between two parties. Our notice pleading system encourages parties to join together in a single lawsuit all the claims that the parties have against one another. Once the lawsuit ends, our claim preclusion will step-in to bar any further litigation between the parties relating to that transaction or occurrence. If, for example, a patentee sues a manufacturer for infringing claim 1 of its patent (and wins). The patentee will be barred from later filing a lawsuit asserting claim 2 of the same patent against the same manufacturer for the same infringing behavior.
Claim preclusion is thought to also precludes defenses that were raised or that could have been raised in the the first lawsuit. However, a key limiting factor that the court found today is the “same transaction” or “common nucleus of operative facts” test — and that test is defined by the well pled complaint.
Here, the Supreme Court explained that the two lawsuits did not involve the same claims: “Put simply, the two suits here were grounded on different conduct, involving different marks, occurring at different times.” Thus, no claim preclusion. [I believe that both cases involved assertion of the “get lucky” mark, and so I don’t know what the court is talking about regarding “different marks.” – DC]
Note here that the court also suggested a possibility of eliminating claim preclusion to defenses altogether: “There may be good reasons to question any application of claim preclusion to defenses.” That issue though is saved for another day.
Issue preclusion bars relitigation of an already decided issue. However, issue preclusion requires that the issue be actually decided. Although the defense was raised in the original lawsuit, it was not actually decided but rather dismissed without prejudice. Thus, no issue preclusion.
The Court specifically pointed out the risk in barring such claims in trademark cases, when “liability for trademark infringement turns on marketplace realities that can change dramatically from year to year.”
The court could have allowed more conflation between these various cases, but drew a tight line on the “same claim” element of claim preclusion. One ongoing debate on this topic in patent law is the extent that a patentee should be required to assert all of its patents related to a defendant’s accused infringing content at the risk of beinig precluded. Or, may a patentee file a first lawsuit with a first patent; then later a second lawsuit with a second patent; etc. Current Federal Circuit rule is that allegations of infringement of two different patents involve the “same claim” only if the claim scopes are “essentially the same.” SimpleAir, Inc. v. Google LLC, 884 F.3d 1160, 1167 (Fed. Cir. 2018); See also Acumed LLC v. Stryker Corp., 525 F.3d 1319 (Fed. Cir. 2008) (same claim also requires infringing activity to be “essentially the same”).
by Dennis Crouch
This case is going to end up being a big one for our online marketplace. Many many producers are finding knock-off versions of their products sold via Amazon — often with Amazon’s direct backing. The decision here support’s Amazon’s approach and is especially important coming from the pro-protection Federal Circuit. Importantly, the court here does not allow IP rights to be improperly extended in order to catch a counterfeit.
Lanard Toys Limited v. Dolgencorp LLC and Ja-Ru (Fed. Cir. 2020)
Lanard makes the “Lanard Chalk Pencil” and sued the knock-off competitor Ja-Ru Products along with Lanard’s former distributor Dolgencorp and former retailer Toys-R-Us.
The setup begins with the clear statement that Ja-Ru copied the design and then Dolgencorp and TRU stopped buying from Lanard and started buying from Ja-Ru. The question then is whether this setup is simply fair competition or is it somehow unfair or unlawful.
Here, Lanard made its chalk-pencil product look like a well-known unprotectable product — a pencil with an eraser. Perhaps it shouldn’t be surprised that its associated exclusive rights are quite thin.
The trial court ended the case on summary judgment holding that (1) Ja-Ru’s product does not infringe the asserted design patent, D671,167; (2) that the asserted copyright over the pencil is invalid and not infringed; (3) Ja-Ur’s product does not infringe Lanard’s trade dress; and (4) there was no unfair competition since no IP rights were violated.
On appeal, the Federal Circuit has affirmed.
Infringing the Design Patent: The design patent is directed toward the “ornamental design for a chalk holder” as shown in the drawings. 35 USC 289 calls out design patent infringer as someone who as “applies the patented design, or any colorable imitation thereof, to any article of manufacture for the purpose of sale …” Here, the court did not cite the statute, but went straight to the test in Egyptian Goddess that asks – what is the scope of the patented design? In that case, the court explained that the scope of a design patent will depend upon how it differs from the prior art. Here:
The district court  recognized that “the overall appearance of Lanard’s design is distinct from this prior art only in the precise proportions of its various elements in relation to each other, the size and ornamentation of the ferrule, and the particular size and shape of the conical tapered end.” In so doing, the district court fleshed out and rejected Lanard’s attempt to distinguish its patent from the prior art by importing the “the chalk holder function of its design” into the construction of the claim.
The Federal Circuit affirmed this approach as well as the district court’s separate consideration of functional and non-functional features of the design.
We have instructed trial courts that design patents “typically are claimed as shown in drawings,” but that it can be helpful to “distinguish between those features of the claimed design that are ornamental and those that are purely functional.” Egyptian Goddess.
In the end, the court compared the accused product with the patented design — keeping in mind the broad scope of prior art — and concluded that the ordinary observer would be drawn more to the differences than the similarities.
In its decision, the Federal Circuit focused some attention on the “points of novelty” that the Federal Circuit previously rejected as a requisite test for design patent infringement. Here, the court recognized that the doctrine remains a useful approach when considering the scope of design patent claims.
Here, as a matter of claim construction, the district court undoubtedly considered the points of novelty of the patented design over the prior art. And the court placed those points of novelty in context by considering that those points of novelty would draw “the attention of the ordinary observer.” [W]e conclude that the district court correctly balanced the need to consider the points of novelty while remaining focused on how an ordinary observer would view the overall design. See Egyptian Goddess.
On Copyright infringement, the court here essentially ruled that the pencil is more like a shovel than a cheerleader uniform. See Star Athletica, L.L.C. v. Varsity Brands, Inc., 137 S. Ct. 1002 (2017).
In attempting to identify separable features, “the feature cannot itself be a useful article.” Star Athletica. … Here, Lanard’s ’458 copyright is for the chalk holder itself, and Lanard’s arguments in the district court and in this appeal merely confirm that it seeks protection for the dimensions and shape of the useful article itself. Because the chalk holder itself is not copyright protectable, Lanard cannot demonstrate that it holds a valid copyright.
The appellate panel went on to similarly reject Landards trade dress & unfair competition claims. (“Lanard has not identified evidence with which it could satisfy its burden to prove at trial that, when customers see the Lanard Chalk Pencil, their minds jump to the producer of the product rather than the product itself.”)
Virnetx Inc. v. Cisco Systems and USPTO (intervenor) (Fed. Cir. 2020) (precedential rehearing denial)
In Virnetx, the Federal Circuit issued a non-precedential decision remanding and vacating the PTO decision in light of Arthrex (unconstitutionally appointed PTAB judges cannot cancel a patent). One difference between this case and artrex is that the Virnetx patents were cancelled via pre-AIA inter partes reexamination rather than inter partes review. The court found the difference meaningless:
Although this appeal arises out of an inter partes reexamination and not an inter partes review as was at issue in Arthrex, we see no material difference in the relevant analysis. We therefore grant VirnetX’s motion.
Slip Op. (Opinion by Judge O’Malley and joined by Judges Moore and Chen). [VirnetxArthrexI].
The PTO immediately filed a petition for panel rehearing and rehearing en banc. Those petitions have now been denied. However, the original panel has expanded upon its original opinion in with further justification.
The PTO’s particular contention goes as follows: PTAB judges may be acting as principal officers when ruling over AIA trials, but they are not so high-and-mighty when hearing an inter partes reexamination appeal (or presumably an ex parte appeal from a patent applicant). In response, the Federal Circuit explained that an individual’s Appointment status is associated with the whole person and is related to “all of that appointee’s duties.” See Freytag v. Commissioner of Internal Revenue, 501 U.S. 868 (1991).
The court thus concludes:
[I]f these APJs are unconstitutionally appointed principal officers because of their inter partes review duties in light of Arthrex, it would appear that under Freytag vacatur would be appropriate for all agency actions rendered by those APJs regardless of the specific type of
review proceeding on appeal.
Rehearing Denial. See also Arthrex, Inc. v. Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019) en banc denied in Arthrex, Inc. v. Smith & Nephew, Inc., 953 F.3d 760 (Fed. Cir. 2020). Multiple petitions for writ of certiorari are likely coming soon in Arthrex.
Of some interest, the PTO requested that the mandate from that case be delayed, but that motion was denied by the panel. Fed. R. App. P. 41(d)(1). The PTO had hoped to delay holding remand IPR trials in Arthrex and other similarly situated cases. In its denial of the stay-of-mandate, the Federal Circuit explained its position:
The delay contemplated by the United States could cause harm. All the cases in this court that are in posture similar to that of Arthrex involve patent claims deemed unpatentable by the Board. The delay contemplated by the United States would cause the continuation of stays in those proceedings and in related proceedings in district courts. Those stays have the effect of leaving the patent claims in force and also could cause the continued obligation to pay fees under license agreements that (as is common) require payment until a final adjudication of invalidity. At the same time, the limited remand proceedings required by the Arthrex decision (in no more than 81 cases) do not seem especially burdensome, given the resources of the Board, which has more than 250 members. . . . We conclude that the public interest under these circumstances favors denying the stay.
ArthrexStayDenial (March 30, 2020) Note here that, the PTAB count is “more than 100 decisions” that have been vacated under Arthrex “and more such Orders are expected.” In a General Order, Chief Administrative Patent Judge Scott Boalick has now ordered “all such cases in administrative abeyance until the Supreme Court acts on a petition for certiorari or the time for filing such petitions expires.” This General Order from the PTAB appears contrary to the spirit of the the above-quoted order from the Federal Circuit. I expect at least one of the 100+ patentees will attempt an emergency appeal of the general suspension of activity by the PTAB.