December 2014

Examination Guidelines on Patent Eligibility

Patent,

The US Patent Office has released a new set of guidelines for judging patent eligiblity based upon the Supreme Court’s recent quartet of Bilski, Mayo, Myriad, and Alice.  The guidelines do not carry the force of law but are designed to serve as a manual for examiners when determining eligibility.

The guidelines follow the same two-step analysis described in Mayo and Alice. And,  although the two-step test was not applied directly in the cDNA case of Myriad, the guidelines suggest that the test is uniform across the subject matter areas.   However, the particular examples show that the USPTO intends to be less aggressive at finding eligibility problems with products of nature or natural phenomenon as compared those directed toward abstract ideas.

It will take some time to digest these, but the info is below:

DDR Holdings – Federal Circuit Forges a Sensible Path on Software Patents

Patent, , ,

Guest post by Bart Eppenauer. 

Amidst all the angst and uncertainty following the Supreme Court’s decision in Alice Corp. v. CLS Bank (2014), patent owners and inventors in the Information Technology world should be celebrating the decision last week in DDR Holdings v. Hotels.com from the Federal Circuit.  While the Alice decision fell short of ushering in a bright line test with absolute clarity, a vocal minority has grabbed the opportunity to generate headlines suggesting that software patents are all but dead in the water.  This kind of hysteria is not only unfounded, but it sends the wrong message to our policymakers, and to startups and innovative companies of all sizes across all industries.  Perhaps its wishful thinking to expect that DDR Holdings will quell opponents of software patents in any respect, but the decision should send a strong signal that software patents are far from dead.  As I’ve recently urged, the proper course of action at this point is to take a calm, measured and rational approach as we work through the current state of affairs.

As noted by Professor Crouch in his earlier post on DDR Holdings, the DDR ‘399 patent at issue under Section 101 involved an e-commerce syndication system for generating a composite web page that combines selected visual elements of a host website with content of a third-party merchant.  While I can acknowledge the view that the analysis in DDR Holdings could be in tension with the Federal Circuit’s Ultramercial decision, I firmly believe that the DDR patent falls within the contours of patent eligible subject matter.  And I respectfully take issue with the characterization of the DDR patent as a “business method” patent.  In my view, the DDR patent, both in the disclosure and in the claims, sets forth and defines a technical solution to a technical problem through the implementation of computer software in the context of e-commerce.  A cursory review of the specifications and claims of the DDR patent, the representative Alice patent and the Ultramercial patent reveals the stark differences in the level (or absence thereof) of technology-based, software-based disclosure in these patents.

The Alice patents were drawn to an abstract business method for intermediated settlement – i.e., escrow – hardly a new business concept.  The patents contained token references to performing the purported invention on a generic computer.  The patent in Ultramercial involved a business method for allowing consumers to access copyrighted content over the internet in exchange for viewing an advertisement.  In that patent, there is absolutely no disclosure whatsoever of software or computer technology, or of any other technological advancement in the form of computer software or hardware, or anything else.  The Ultramercial patent was simply a business method and nothing more.  In both cases, the now-defunct patents mentioned computers, but did not provide a technological connection between their described method and any kind of actual software innovation.

That connection is exactly what real software enables.  The Supreme Court explicitly stated that the Alice patent claims did not purport to improve the functioning of a computer itself, nor did they advance an improvement in any other technology or technical field.  And contrary to the assertions that the decision threatens all software patents, the Supreme Court specifically acknowledged, as if there was any question to begin with, that many computer-implemented claims (i.e., software) are indeed within the domain of patent-eligible subject matter.  In Ultramercial, the Federal Circuit followed suit in its recognition that at some level all inventions embody or otherwise use abstract ideas or laws of nature, but that they “do not purport to state that all claims in all software-based patents will necessarily be directed to an abstract idea.” Ultramercial at p. 10 (emphasis added).

Turning to the DDR patent, the Federal Circuit justifiably recognized that “the claimed solution is necessarily rooted in computer technology to overcome a problem specifically arising in the realm of computer networks” (DDR at p. 20), whereas the patents from earlier cited decisions claimed nothing more than the performance of abstract business practices on the Internet or using a generic computer.  Just a brief snippet of technical disclosure from the DDR patent illustrates that this is so:

  • The Link Generator allows host to create and maintain the shopping opportunities that they can then place on their site. Each Link is assigned a unique Link ID. The Link ID identifies who the host is, who the merchant is, and what commerce object (catalog, category, product or dynamic selection) is linked to.
  • The first time a host builds a Link to a merchant’s product, category or catalog, an approval of that host for that merchant may be made. Until the host is approved, they cannot see the Link ID that has been assigned to the newly created Link.
  • The code the host embeds on their web site is as follows:
    < !—BEGIN NEXCHANGE LINK—>
    < !—For more information go to http://www.nexchange.com—>
    < !—The following 2 lines MUST NOT BE CHANGED to ensure proper crediting—>
    < IMG BORDER=‘0’ SRC=‘http://www.nexchange.net/img.asp?LinkID=xxxx’>
    < a href=‘http://www.nexchange.net/route.asp?LinkID=xxxx’>
    < !—Substitute your own text or image below—>
    **YOUR TEXT OR IMAGE HERE**</a>
    < !—END NEXCHANGE LINK—>
  • There are several points to note here:
    • The image src (img.asp) is actually an ASP program that returns a single transparent pixel. This is used to track impressions (how many times the link was displayed on the host site).
    • The route.asp page is a page that routes the customer to the shopping page. As additional servers are added, this will become very important for load balancing.
    • The ‘xxxx’ for the LinkID=‘xxxx’ is the Link ID assigned to the Link in the Link Generator.

This, along with many other examples of software-based technical disclosure in the patent specification, supports the Federal Circuit’s conclusion that the DDR patent claims “specify how interactions with the Internet are manipulated to yield a desired result” and “recite an invention that is not merely the routine or conventional use of the Internet.” (DDR at pp. 22-23).  In other words, the DDR patent claims, while relating to a business challenge, are simply not directed to an abstract idea under the Alice test.

So why all the purported confusion surrounding software patents, business method patents, and the differences there between?  After more than two decades in the IP field, I believe it comes down to a fundamental misunderstanding (and sometimes willful disregard to advance an ideology) of the true nature of “software.”

By way of the briefest of explanations, the execution of a typical software program illustrates that software implemented processes perform rapid activation and deactivation of transistors.  Software defined instructions operate on the information stored within transistor elements.  A software program in a modern computer can perform at least hundreds of millions of such operations per second.  In essence, software instructions literally, but temporarily, reconfigure electronic pathways and transform computing hardware to perform real, useful, and physical activity.

When an algorithm is implemented “purely in software,” it necessarily controls hardware components to carry out computerized actions.  I was struck by Professor Crouch’s Halloween report on his 9 year old daughter’s amazingly insightful viewpoint on how software actually transforms computers into different machines and provides very different experiences.  In discussing the differences between using Microsoft Word and playing her WarriorCat game, she explained – “Sure, the box is the same in both situations.  But, Microsoft Word obeys me and the game thwarts my moves. I see them as very different.  Its brain changes.”

Reducing software code to “just math” or sweeping it away as an abstraction is an inaccurate reading of patent case law that could jeopardize the future of innovation in this country.  The vast majority of companies that obtain software patents are manufacturing companies that integrate software into products they manufacture to deliver valuable new advancements.  These inno­va­tions power technologies ranging from modern smartphones to advanced robotic manufacturing, fly-by-wire aircraft systems, artificial retinas, driverless cars, GPS, medical and diagnostic tools, just to scratch the surface.

The past few years have been a time of unprecedented change to patent law.  Clearly there will be many more Section 101 cases to come that land on both sides of the abstract idea line (whatever and wherever that line may be).  While we’re just at the early stages of a post-Alice world, in my view the DDR decision forges a sensible path on software patentability.  With so much at stake in terms of America’s role as an innovation leader and the incredible economic impact that the IT industry fuels, let’s hope that more decisions follow the path of DDR.

Bart Eppenauer is the Managing Partner of the Seattle office of Shook Hardy & Bacon.

Supreme Court to test its Spidey-Sense in Patent-Antitrust Case

Patent,

The Supreme Court has granted certiorari in the patent licensing case of Kimble v. Marvel Enterprises (13-720) with the following question:

Whether the Court should overrule Brulotte v. Thys Co., which held that “a patentee’s use of a royalty agreement that projects beyond the expiration date of the patent is unlawful per se.”

The policy goal behind the 1964 Brulotte decision is to avoid the potential antitrust harm associated with an ongoing patent monopoly beyond the 20-year term.  However, antitrust law has generally moved away from this sort of per se rule – especially as to freedom-of-contract.

In this case, the patentee’s patent has expired, but the license agreement seemingly calls for ongoing payments even beyond expiration.  The Ninth Circuit held that, under Brulotte, Marvel is no longer required to pay royalties on its sales of the Spider-man toy.  The Solicitor General recommend that the Supreme Court not take the case — a move that I called “somewhat surprising” since the government had previously noted that Brulotte does not mesh well with contemporary antitrust practice.

With Brulotte on the chopping block, we can also expect that the holding in Lear v. Adkins, 395 U.S. 653 (1969). In that case, the court held that a contractual promise not to challenge a patent’s invalidity is unenforceable.

Obviousness: Analogous Art and Hindsight

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by Dennis Crouch

In an interesting September 2014 decision, the Federal Circuit upheld a USPTO determination of obviousness.  The majority decision (authored by Judge Newman) touches on both (1) analogous-art and (2) motivation to combine references. The problem-focused approach taken by the majority in determining analogous art is fascinatingly similar to parts of the abstract-idea analysis in Alice Corp. — looking generally to the problem-to-be-solved as the overarching focus of the invention.  Writing in dissent, Judge Moore characterized the obviousness determination as “[h]indsight, hindsight, hindsight.”  [Decision]

Scientific Plastic Products (SPP) holds a number of patents relating to cartridges for low pressure liquid chromatography (LPLC) with a resealable screw-on cap. See U.S. Patent Nos. 7,138,061, 7,381,327 and 7,410,571. When SPP sued Biotage for infringement, the defendant responded by filing an inter partes reexamination.  Reexam Nos. 95/000,495, ‘496, and ‘497 (filed in 2009, pre-AIA).  Based upon his consideration of the prior art, the patent examiner rejected all of the claims of each patent — finding them obvious under 35 U.S.C. 103. That decision was affirmed by the PTAB and is the subject of the appeal here.  Meanwhile, the district court case has been stayed pending outcome of the reexamination.  On appeal here, a split panel of the Federal Circuit has affirmed the USPTO rejection – with Judge Newman joined by Judge Wallach writing the majority and Judge Moore in dissent.

The primary obviousness reference in the case apparently discloses all of the elements of the patented LPLC cartridge except for one – a tapered lip of the cartridge that corresponds to a taper in the screw-on cap.  The tapering helps create a better seal and avoid leakage when the cap is on.  It turns out that the tapered lip feature is not new, and the USPTO identified two different patents from the soda-pop bottle industry that disclosed the approach.  See for example, Strassheimer (Patent No. 5,100,013).

Obviousness: Section 103 of the Patent Act provides the basic test for obviousness — whether “differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious . . . to a person having ordinary skill in the art to which the claimed invention pertains.”   The two primary interpretations of this decision are Graham v. John Deere Co., 383 U.S. 1 (1966)(outlining test) and KSR Int’l Co. v. Teleflex, Inc, 550 U.S. 398 (2007) (explaining that test should not be rigid but instead apply common sense).

Deere explained that there are four factual prerequisites to consider when determining the legal question of obviousness.

  1. The level of ordinary skill in the art;
  2. The scope and content of the prior art;
  3. The differences between the claimed invention and the prior art;
  4. Any objective indicia of nonobviousness.

Those who know Deere well will notice that I have re-arranged the order of the test by placing the level of ordinary skill in the art as the first step in the analysis. I do that because – as explained below – the scope-and-content of the prior art is impacted by the level of skill in the art.

In many obviousness cases, all of the elements of the invention are found within a limited set of prior art references. The argument then is that it would have been obvious for one skilled in the art to think of combining the elements from those references to create the claimed invention.  In KSR, the Court held that the justification for such a combination can be based upon common sense or other evidence and does not require a particular teaching-suggestion-or-motivation found within the prior art itself.

Scope of the Prior Art: The scope and content of prior art is determined by several factors. First, evidence must fall within the prior art definitions for anticipatory references under 35 U.S. 102.  Second, the prior art must also be seen as “analogous art.”  The analogous art requirement is based upon the idea that someone working in a particular field would be unlikely to search through or know all possible prior art but rather would focus attention on what is known (1) in the same field of endeavor or (2) to be addressing the same problem.  The general question is whether it would have been “reasonable” for a person of ordinary skill in the art to consider the given prior art in order to solve the problem confronting the inventor. In re Clay, 966 F.2d 656 (Fed. Cir. 1992).

Here, the problem identified by the inventor was to prevent leakage on a plastic screw-cap and everyone knows that the soda-pop bottles have solved that problem. From that framework this is an easy case.  However, the patentee here argued that this analysis involves improper hindsight because the leakage problem was one identified by the inventor as part of the invention process and was not previously identified in the prior art.

The Federal Circuit implicitly agreed that it would be improper hindsight to rely upon the problem first identified by the inventor for determining analogous art. However, the court rejected that argument as applied to the facts here.  In particular, the PTAB noted that the primary LPLC reference includes a particular o-ring seal that serves as an implicit recognition leakage could be a problem. On appeal, the Federal Circuit confirmed that the implicit concern was sufficient to avoid  hindsight concerns.  Affirmed.

= = = =

Writing in dissent, Judge Moore argues that majority opinion is hindsight of the worst kind, ‘wherein that which only the invention taught is used against its teacher.’ quoting W.L. Gore & Assocs., Inc. v. Garlock, Inc., 721 F.2d 1540(Fed. Cir. 1983).

The patents do not indicate that leakage was a problem identified in the prior art or a problem known to those of skill in the art. Rather they indicate that the claimed design will avoid leakage. These inventors identified a design problem, articulated it, and solved it. There is absolutely no evidence of the existence of a known leakage problem that would have motivated skilled artisans to modify Yamada. The Board is taking the ingenuity of these inventors and, without any record basis, attributing that knowledge to all skilled artisans as the motivation to make the inventions at issue. Hindsight, hindsight, hindsight. . . .

I would reverse because I conclude that the Board’s cancellation of the claims at issue was based entirely on hindsight reconstruction—there is no record evidence that one of skill in the art would have been motivated to modify Yamada with soda pop bottle sealing closures.

An implicit suggestion from Judge Moore is that in hotly contested post-issuance cases invalidating evidence should be high quality:

These were inter partes reexamination proceedings between sophisticated parties. Both parties put on expert testimony regarding obviousness. Yet there is no evidence that the chromatography cartridges in Yamada had
a leakage problem that skilled artisans would have been motivated to address.

Judge Moore also challenged the PTAB’s failure to determine the level of ordinary skill in the art.  “An ordinarily skilled chemist would have likely looked to a different body of prior art than an ordinarily skilled mechanical engineer with industrial design experience. . . We cannot answer the analogous art question without knowing who the person of ordinary skill is.”

It is Time to Confirm Michelle Lee

Patent

There were no surprises with this morning’s consideration of Michelle Lee as the nominee to the position of Under Secretary of Commerce and Patent Office director.  The Senate should – but will not – move quickly to confirm the nomination.  In particular, Senator Grassley – upcoming Judiciary Chair – indicated that the Republicans will not allow a vote on the nomination until the next Congress begins in January.  Because the new Congress would hold new hearings, confirmation is unlikely before March 2015.  That timeline will mean that the USPTO will have been without a Senate confirmed director for more than two years.

For the past year, Lee has been serving as the USPTO’s unofficial director – leading the agency through a time of tremendous systemic change. However, her position has been without the imprimatur of Senate Confirmation as the official Director. In the politics-heavy beltway game, Lee’s lack of official leadership title has impacted her activities both inside and outside the USPTO.  These challenges extend both to factions within the USPTO (e.g., patent operations and activities of the chief information officer); interactions with the White House and Commerce Department leadership; and in providing guidance to Congress regarding legislative reforms.

At times, the Senate has legitimate questions regarding a nominee’s qualifications or ethical lapses. That is not the case with Lee.  In an email, Hal Wegner writes:

The nominee has been center stage for quite some time.   No ethical blemishes or other smudges appear to tarnish a squeaky clean personal image.  There is thus no reason to block her nomination.  Indeed, it has been more than two full years since the most recent Under Secretary had announced his resignation. . . . [T]the nominee should be confirmed in the present lame duck session.

As Wegner notes, in DC politics – we often see a vast difference between what should happen and what does happen.

Patentee Seeks Cert Due to Mediator’s Failure to Disclose Conflicts that CAFC Held Breached Mediator’s Duties and Undermined Trust in Mediation

Ethics

The cert petition in Ceats, Inc. v. Continental Airlines, Inc. is here, I hope not behind a paywall.  The question presented:

Petitioner CEATS, Inc. (“Petitioner” or “CEATS”) engaged in court-ordered mediation with a mediator who had an undisclosed close, enduring, and personal relationship with a partner for the law firm that was lead defense counsel in the underlying CEATS patent infringement litigation. The undisclosed relationship involved continuous emails, phone calls, visits, gifts, and lavish dinners. The Federal Circuit found that: (i) the mediator breached his duty of disclosure by failing to inform Petitioner of the relationship; and (ii) the breach was likely to undermine the public’s confidence and trust in mediation.

Notwithstanding those express findings and express recognition of the potential adverse impact the decision would have on the public’s view of the federal mediation process generally, the Federal Circuit declined to grant Petitioner any form of relief under Fed. R. Civ. P. 60(b). To reach its conclusion, the Federal Circuit utilized the special harmless error standard for judges set forth in the United States Supreme Court case Liljeberg v. Health Services Acquisition Corp., 486 U.S. 847 (1988).

The issue presented is whether in the face of a specific finding that the court-appointed mediator breached his duty to disclose the conflict, did the Federal Circuit err in utilizing the special harmless error standard from Liljeberg for a mediator in declining to grant Petitioner any relief for the undisclosed conflict of interest.

Stated another way, the question for Supreme Court review is whether the failure of a court-appointed mediator to disclose a long standing conflict of interest with one of the parties to the mediation can ever be “harmless.” The answer to that question strikes at the very foundation of the integrity of the Federal judicial process as well as the public’s perception of the fundamental fairness of those proceedings.

Next Steps in Shifting Pleading Standards for Patent Cases

Patent

by Dennis Crouch

Changing the Rules of Civil Procedure: The Federal Rules of Civil Procedure operate with the force of law, but their implementation procedure is unusual.  In 1934, Congress adopted the Rules Enabling Act that shifts power in drafting the rules to the courts.  The process starts with the Judicial Conference that proposes any rule changes.  The Supreme Court can then vote to adopt the proposed changes.  Congress did not fully abdicate its power. Rather the statute provides Congress the power to reject the Supreme Court’s proposed rules.  The default, however, is that rules will become effective if Congress does nothing. Timing-wise, rules adopted by the Supreme Court by May 1 will become effective on December 1 of that same year.

Pleading Standards and R.84: In Iqbal and Twombly, the Supreme Court raised the standards required for pleadings (complaints, answers, etc) to now require that facts be pled sufficient to make relief plausible rather than mere conclusionsleading to conceivable relief.  In the patent context, for instance, merely pleading that “defendant infringes the the ‘XYZ patent” would seemingly be insufficient without adding more factual context.   However, Iqbal and Twombly have not been applied in the patent infringement context because the Rules include a special loophole known as Rule 84 and the Form Complaints.  Basically, the rules of civil procedure include an appendix of form complaints that include Form 18 – a patent infringement complaint – and Rule 84 declares that complaints that follow the form will be deemed sufficient.

In many cases (but certainly not all), patentees provide bare-bones complaints that fail, for instance, to identify which products infringe which claims of which asserted patents.  Some courts have adopted a requirement that such detail be provided in an early mandatory disclosure, but many courts delay that requirement for months.

Eliminating R 84 and the Form Complaints: The September 2014 Judicial Conference proposal would eliminate R.84 and the form complaints. The result then would be that patent infringement complaints would be judged under the higher standard of Iqbal and Twombly – just like all other federal cases.

Up to now, the Supreme Court has not adopted or otherwise acted on the proposal.  Under the statute, the Court’s delay has no meaningful impact because it cannot be implemented until December 1 2015 at the earliest.

Supreme Court Racing against Congress: However, the Supreme Court is not operating in a vacuum. Rather Congress is also considering its own amendments to the rules that would go well beyond Iqbal and Twombly. Notably, the Goodlatte proposal would require that a patent infringement complaint identify with specificity how each limitation of each asserted claim is infringed by each accused instrumentality.

Supreme Court action here will largely serve to eliminate the demand for Congressional pleading reforms.  I see that as strongly positive because of problematic features of the Goodlatte pleading proposal. However, time will tell which side wins this slow-motion race.

See also: Dennis Crouch, Heightened Pleading Requirements: Patent Reform through the Supreme Court and Judicial Conference, Patently-O (2014); K-Tech Telecommunications v. Time Warner (Fed. Cir.2013)

 

Federal Circuit Supports USPTO’s Refusal to Withdraw Terminal Disclaimer

Patent

by Dennis Crouch

Japanese Foundation for Cancer Research v. Michelle Lee (Fed. Cir. 2014)

[Note – Read Prof Hricik’s discussion here]

The Japanese Foundation holds several patents relating to treatment of malignancies with a drug causing cell apoptosis.  See U.S. Patent No. 6,194,187.  The ‘187 patent issued in 2001.  In October 2011, Japanese Foundation’s attorney filed a disclaimer of the remaining term of the ‘187 patent. Then, two months later, the Foundation petitioned the USPTO to withdraw the disclaimer.  However, the USPTO refused to withdraw the disclaimer — indicating that neither statute nor the rules of practice provide a mechanism for withdrawal or amendment of a fully processed terminal disclaimer.

According to the explanation from the Foundation, a paralegal at the Japanese Firm mistakenly sent a request to Foley & Lardner to abandon the patent rather than an inquiry regarding disclaimer.  In particular, the USPTO argues that it should be able to fully rely upon statements by a patentee’s legal representative.

After failing to convince the USPTO to reconsider, the Foundation filed a civil action in the E.D. Va. Federal Court.  The district court sided with the patentee and held that the PTO must withdraw the disclaimer “absent a finding that the Foundation actually authorized its filing.”

On appeal, the Federal Circuit has reversed – siding with the USPTO and finding that the USPTO had not acted arbitrarily and capriciously nor had it abused its discretion by refusing to withdraw the terminal disclaimer.

Under the Administrative Procedures Act (APA), an agency’s action will be set aside if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A).  This standard is normally met only if the [agency] decision was not based on the relevant factors or it fails toexamine the relevant data and articulate a satisfactory explanation for its action including a rational connection between the facts found and the choice made.” However, unlike actions of many federal agencies, USPTO statutory interpretations are ordinarily given no deference and USPTO decisions based upon an erroneous interpretations of the law will also be overturned.

An oddity of the case here is, although the Foundation did not file for a certificate of correction under 35 U.S.C. 255, it argued on appeal that the USPTO has inherent authority to withdrawing the disclaimer that is housed in Section 255.

In the appeal, however, the Federal Circuit found no basis for issuing a certificate of correction because the mistake in filing the disclaimer was not “of a clerical or typographical nature, or of minor character.”

Director Michelle Lee: Confirmation Hearing

Patent

For the past year, USPTO Deputy Director Michelle Lee’s status has been in-limbo.  Although she has been acting as director of the USPTO, the law did not allow her to be identified as the acting director.  During this time, the Obama administration informally floated several potential directorship nominees. However, none of those made the political cut.  Finally, in October 2014, the White Housenominated Lee to move up from Deputy Director to Director.  That position also comes with the title of Undersecretary of Commerce.

The Democrats in the Senate appear to be hoping to move quickly before Republicans take control in January.

 

Federal Circuit Reverses District Court, Holds PTO Properly Refused to Withdraw a Terminal Disclaimer the Client did not Authorize

Ethics

Japanese Foundation for Cancer Research v. Lee (Prost-auth; Dyk; Taranto), mentions and partly arose out of the tsunami that devastated Japan a few years ago.  The Japanese Foundation owned a patent. A Foundation employee asked a paralegal at a Japanese firm whether a patent could be abandoned or disclaimed before non-payment of maintenance fees.  The paralegal then sent a fax to the Foundation’s attorney of record for the patent, Foley & Lardner, stating that the clients “would like to abandon” the patent before “before the case lapses by nonpayment of the next maintenance fees” which were due in a year and a half.  The paralegal asked for any necessary forms.

Two days later the tsunami and earthquake hit.  This caused the paralegal to lose track of the matter.

Meanwhile, six months after getting the fax, the attorney of record filed a statutory disclaimer.  Two months later, he petitioned to withdraw it.  The PTO rejected the petition because the attorney filed the disclaimer with a valid POA.  The PTO rejected subsequent efforts to get the disclaimer withdrawn.

Then the Foundation filed suit in district court, which directed the PTO to withdraw the disclaimer unless the PTO found that the “Foundation actually authorized its filing.”  The PTO appealed, and Chief Judge Prost wrote the panel opinion reversing the district court.

The opinion is significant for a couple reasons.  One is that the panel held that 35 USC 255, governing certificates of correction, would not allow withdrawing a mistakenly filed statutory disclaimer.  In doing so, it distinguished an earlier malpractice case where a disclaimer had been filed but in the wrong application, and correction was permitted, but the disclaimer was still effective as to the intended patent.  The court said this was different, since here there was no “clerical or typographical error” in terms of 255:  it reasoned that such an error “appears on the face of the document, as opposed to the filing of the document itself.”  That sounds right.

Second, the district court had held that the PTO had inherent authority to withdraw a mistakenly filed terminal disclaimer.  The district court had relied upon this power to order the PTO to withdraw it.  The panel reversed, relying on the deference afforded to the PTO’s determination that the patentee was “bound by the actions or inactions of his voluntarily-chosen representative.”  Once the PTO found the attorney of record signed the disclaimer, the inquiry ended as far as the PTO went.  The panel then reasoned:

The Foundation suggests that it should not be bound to the consequences of its attorney of record’s actions, as it resulted in the loss of a valuable property right. It analogizes, as the district court did, to the principle that an attorney cannot settle a case or waive certain rights without the client’s authorization in the context of ordi- nary representation.   The PTO has, however, clearly articulated in its regulations that, other than the patentee, only the attorney of record with power of attorney is authorized to file a terminal disclaimer on the patentee’s behalf. See 37 C.F.R. § 1.32. And here, the patentee provided specific authority to its attorney to file a disclaimer by filing a power of attorney to prosecute the underlying application and to transact all business in the PTO connected therewith. J.A. 199. Even if we disagreed with the PTO’s position as a matter of policy, we must not substitute our own judgment for that of the agency because “[unless] these vital differentiations between the functions of judicial and administrative tribunals are observed, courts will stray outside their province and read the laws of Congress through the distorting lenses of inapplicable legal doctrine.” FCC v. Pottsville Broad. Co., 309 U.S. 134, 144 (1940). We must defer to the agency’s interpretation of its own procedures and regulations, and this case does not indicate the kind of “extremely rare circumstances” that could “justify a court in overturning agency action because of a failure to employ procedures beyond those required by the statute.” Vt. Yankee Nuclear Power Corp. v. Natural Res. Def. Council, Inc., 435 U.S. 519, 524, (1978). Here, the PTO determined that miscommunications between the Foundation and its attorney of record did not excuse the actions of the attorney, and we will not substitute our judgment for that of the agency.

Therefore, we find that the PTO did not act arbitrarily, act capriciously, or abuse its discretion in declining to use any inherent authority that it might have in with-drawing the terminal disclaimer on the ’187 patent that the Foundation’s attorney of record duly filed in accordance with the PTO’s regulations.

(Some citations omitted.)

Be careful out there.

Supreme Court Sanctions for Faulty Brief

Patent,

Anyone who read Sigram Schindler’s petition for writ of certiorari would have walked away confused.  To say that the petition makes little sense is perhaps over stating its value.  The question presented by Schindler was as follows:

Does the US Constitution, in legal decisions based on 35 USC §§ 101/102/103/112, require instantly avoiding the inevitable legal errors in construing incomplete and vague classical claim constructions – especially for “emerging technology claim(ed invention)s, ET CIs” – by construing for them the complete/concise refined claim constructions of the Supreme Court’s KSR/Bilski/Mayo/Myriad/Biosig/Alice line of unanimous precedents framework, or does the US Constitution for such decisions entitle any public institution to refrain, for ET CIs, for a time it feels feasible, from proceeding as these Supreme Court precedents require – or meeting its requirements just by some lip-service – and in the meantime to construe incomplete classical claim constructions, notwithstanding their implied legal errors?”

The Supreme Court has now – as expected – denied the petition.  However, the court took a major step further — ordering Schindler’s Supreme Court attorney to “show cause … why he should not be sanctioned”:

D-2827 IN THE MATTER OF DISCIPLINE OF HOWARD NEIL SHIPLEY

Howard Neil Shipley, of Washington, D.C., is ordered to show cause, within 40 days, why he should not be sanctioned for his conduct as a member of the Bar of this Court in connection with the petition for a writ of certiorari in No. 14-424, Sigram Schindler Beteiligungsgesellschaft MBH v. Lee.

The brief was filed by Howard Shipley of the Foley firm along with his partner George Quillen.  Although I do not know, I suspect that the Foley firm agreed to file the brief as drafted by Dr. Schindler and without providing any substantive input or editing.

Tony Mauro has more.

This case is unlikely to help shift the Supreme Court’s perspective on the Federal Circuit and the current state of patent law doctrine.

 

Not so fast: Phase III Biosimilar Clinical Trial & Infringement Threat does not Create Justiciable Case or Controversy

Patent

by Dennis Crouch

Sandoz v. Amgen is one of the first decisions by the Federal Circuit relating to the biosimilars and the Biologics Price Competition and Innovation Act of 2009 (BPCIA) (codified principally at 42 U.S.C. § 262).  By rejecting jurisdiction here, the court adds incremental value to biologic patents at the cost of some chilling of the development of follow-on biosimilars.

In this case, the Sandoz sued Amgen — asking the court for a declaratory judgment that two of Amgen’s patents covering its Enbrel formulation are invalid.  Patent Nos. 8,063,182 and 8,163,522.  The district court rejected the lawsuit altogether — finding no case-or-controversy sufficient to create jurisdiction.  On appeal, the Federal Circuit has affirmed, although on narrower grounds than did the district court.

Unlike generic drugs, follow-on (“generic”) biologics will typically require additional research because biosimilars are typically – and as their name suggests – only similar to the original treatment product.  This means that a follow-on company will likely make substantial research investments prior to seeking FDA approval.

The BPCIA creates a biosimilars scheme akin to what Hatch-Waxman does with generics.  In particular – like Hatch-Waxman – BPCIA creates a paper-cause-of-action labeling the filing an FDA biosimilarity application as a form of patent infringement.  The particulars of BPCIA is substantially different from Hatch-Waxman, but they run in parallel at least from a 30,000-foot framework.

Here, Sandoz is working on a biosimilar of Enbrel and Amgen has notified Sandoz that its proposed biosimilar would infringe the patent.  In 2013 Sandoz took two simultaneous actions: (1) it began a major (and expensive) Phase III trial of its version of the treatment product and (2) it filed this declaratory judgment action — asking the federal court for a holding that the Amgen patents are both invalid and would not be infringed by Sandoz’ product.  Although Sanoz has already invested in the research, an adverse decision in the DJ case could help the company avoid wasteful spending.  Because pharmaceutical patent litigation takes years to complete, the early-stage lawsuit may well only be complete at around the product launch date.   Importantly, however, courts often make early claim-construction decisions that could be helpful for Sandoz in developing a non-infringing alternative.  Notably, Sandoz research is not alleged to be infringing since (1) it is being done abroad and (2) it likely qualifies for the research exception of 35 U.S.C. 271(e).

Rather than hearing the case, the district court dismissed based upon lack of jurisdiction.  Applying two alternate theories, the district court held (1) that the controversy was not sufficiently immediate and real as required by Supreme Court doctrine on cases-and-controversies; and (2) that the BPCIA preempts declaratory judgment lawsuits prior to the DJ-plaintiff’s FDA biosimilar application filing.

The U.S. Constitution (as interpreted by the Supreme Court) requires an actual and immediate case-or-controversy between the parties.  The approach is to ask “whether the facts alleged … show that there is a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.”  MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127 (2007).

On appeal, the Federal Circuit affirmed – finding no immediate case or controversy between the parties. In addition to the fact that no infringement occurs until at least the FDA filing, the Federal Circuit found that the Sandoz ongoing research could still potentially result in a product that is clearly non-infringing.  Importantly, because the court found no case-or-controversy under MedImmune, the Federal Circuit chose not to address the alternative judgment that BPCIA preempts the lawsuit.

Biopharmaceuticals are on the rise as an important and useful facet of medical technology. However the impact of BPCIA is still yet to be solidified.

Slicing the Bologna: Judge Chen Distinguishes this Business Method from those Found Ineligible in Alice, Bilski, and Ultramercial

Patent, , , ,

By Dennis Crouch

Typically, Supreme Court patent cases alter Federal Circuit precedent, while – at the same time – leaving many open questions for the appellate court to address.  That standard certainly fits the recent set of patent eligibility cases.  In Alice Corp v. CLS Bank (2014) the Supreme Court outlined an eligibility test whose practical impact will vary greatly depending upon how it is implemented by the Patent Office and the court: broadly or narrowly?

In DDR Holdings v. Hotels.com, the Federal Circuit has affirmed the patent eligibility of DDR’s eCommerce patent.  U.S. patent No. 7,818,399. Particularly, Judge Chen authored the majority opinion that was joined by Judge Wallach. Judge Mayer wrote in dissent.  The case is close enough to the line that I expect a strong push for en banc review and certiorari.  Although Judge Chen’s analysis is admirable, I cannot see it standing up to Supreme Court review and, the holding here is in dreadful tension with the Federal Circuit’s recent Ultramercial decision.

The basic idea behind DDR’s patent (as claimed) is to allow a website operator to include various pages within its website that each corresponds to a different merchant (such as a cruise line) with products being sold through a broker (such as a cruise broker).  The various pages will have a look-and-feel that corresponds to the particular merchant (by including, for instance the cruise line logo).  And, the system dynamically populates product options on the site by pinging the broker’s server.  To accomplish all this, the invention uses computer networks in what appears to be standard form without what I would call “new technology.”  Judge Chen writes that a major purpose of this setup is to be able to provide a diversity of stores while keeping customers on the same overall website. Representative claim 19 is posted below.  The accused infringers summarize this as simply “syndicated commerce on the computer using the Internet.”

Patent Eligibility under Alice Corp: The two-step approach to eligibility decreed by Alice Corp first queries whether the invention is directed to an abstract idea. And, if so, then looks to whether the invention includes an “inventive concept” sufficient to “transform” that abstract idea into a patentable invention. In Alice, the Supreme Court particularly held that transformation is not satisfied by merely the recitation of generic computer limitations.

Here, Judge Chen finds that neither step of Alice Corp implicate the patent in question.  In doing so, Judge Chen attempts to cabin-in the scope of ideas that qualify as “abstract ideas.”

Not An Abstract Idea: First, Judge Chen found the solution here to be internet-focused with no direct corresponding offline equivalence. That conclusion is important because it helps distinguish Alice Corp where the Supreme Court found the patented invention there abstract because it related to a longstanding business practice. Judge Chen writes:

[The asserted claims do not] recite a fundamental economic or longstanding commercial practice. Although the claims address a business challenge (retaining website visitors), it is a challenge particular to the Internet.

In the dissent, Judge Mayer challenges this conclusion by drawing an analogy to the pre-internet business of having kiosk within a mall or warehouse shore that sells third-party cruise vacation packages.  Judge Chen rejects that analogy because it does not “account for the ephemeral nature of an Internet “location” or the near-instantaneous transport between these locations made possible by standard Internet communication protocols.”  According to Judge Chen, those differences introduce new problems – and it is those problems that are particularly addressed by the patented invention.

In Ultramercial, the Federal Circuit found that even novel ideas can be abstract. Distinguishing from that case, Judge Chen writes that the claims here:

are different enough in substance from those in Ultramercial because they do not broadly and generically claim “use of the Internet” to perform an abstract business practice (with insignificant added activity). Unlike the claims in Ultramercial, the claims at issue here specify how interactions with the Internet are manipulated to yield a desired result—a result that overrides the routine and conventional sequenceof events ordinarily triggered by the click of a hyperlink.

Moving on, Judge Chen finds that – even if the claims are directed to an abstract idea – they do not preempt that idea but instead represent a “specific way” of creating a composite web page “in order to solve a problem faced by websites on the Internet.”

Writing in dissent, Judge Mayer argues that the patents at issue here are “long on obfuscation but short on substance. Indeed, much of what they disclose is so rudimentary that it borders on the comical.”

DDR’s claims … simply take a well-known and widely-applied business practice and apply it using a generic computer and the Internet. The idea of having a “store within a store” was in widespread use well before the dawn of eCommerce. For example, [NLG], one of the defendants here, previously “sold vacations at . . . BJ’s Wholesale Clubs through point of purchase displays.” . . . DDR’s patents are directed to the same concept. Just as visitors to [BJ’s] could purchase travel products from NLG without leaving the BJ’s warehouse, the claimed system permits a person to purchase goods from a third-party vendor, but still have the visual “impression that she is viewing pages served by the [original host merchant].” Indeed, any doubt as to whether the claimed system is merely an Internet iteration of an established business practice is laid to rest by the fact that one of the named inventors acknowledged that the innovative aspect of his claimed invention was “[t]aking something that worked in the real world and doing it on the Internet.”  . . .

The solution offered by DDR’s claims, however, is not rooted in any new computer technology. Its patents address the problem of preventing online merchants from losing “hard-won visitor traffic,” and the solution they offer
is an entrepreneurial, rather than a technological, one. DDR has admitted that it did not invent any of the generic computer elements disclosed in its claims. There is no dispute, moreover, that at the time of the claimed invention the use of hyperlinks to divert consumers to particular web pages was a well-understood and widely-used technique. While DDR’s patents describe the potential advantages of making two web pages look alike, they do not disclose any non-conventional technology for capturing the “look and feel” of a host website or for giving two web pages a similar appearance.

In concluding that DDR’s claims meet the demands of section 101, the court focuses on the fact that “they recite a specific way to automate the creation of a composite web page . . . .” The Supreme Court, however, has emphatically rejected the idea that claims become patent eligible simply because they disclose a specific solution to a particular problem. . . . Indeed, although the claims at issue in Alice described a very specific method for conducting intermediated settlement, the Court nonetheless unanimously concluded that they fell outside section 101.

= = = = =

This case may end up again delaying the expected USPTO examiner guidance on abstract idea analysis.

= = = = =

The patent itself issued in 2006 but claims priority to a 1998 filing.  Five inventors are listed including father-son pair: DD Ross, Sr. and Jr. – hence DDR Holdings.

= = = = =

Claim 19. A system useful in an outsource provider serving web pages offering commercial opportunities, the system comprising:

(a) a computer store containing data, for each of a plurality of first web pages, defining a plurality of visually perceptible elements, which visually perceptible elements correspond to the plurality of first web pages; (i) wherein each of the first web pages belongs to one of a plurality of web page owners; (ii) wherein each of the first web pages displays at least one active link associated with a commerce object associated with a buying opportunity of a selected one of a plurality of merchants; and (iii) wherein the selected merchant, the outsource provider, and the owner of the first web page displaying the associated link are each third parties with respect to one other;

(b) a computer server at the outsource provider, which computer server is coupled to the computer store and programmed to: (i) receive from the web browser of a computer user a signal indicating activation of one of the links displayed by one of the first web pages; (ii) automatically identify as the source page the one of the first web pages on which the link has been activated; (iii) in response to identification of the source page, automatically retrieve the stored data corresponding to the source page; and (iv) using the data retrieved, automatically generate and transmit to the web browser a second web page that displays: (A) information associated with the commerce object associated with the link that has been activated, and (B) the plurality of visually perceptible elements visually corresponding to the source page.

USPTO Patent Grants

Patent

GrantsPerYearAlthough December has just begun, the USPTO has already issued more patents in calendar year 2014 than in any other prior year.  I expect that the total will be around 304,000 utility patents issued this year. The number of grants has more than doubled since 2005.

We can expect some further increase in 2015 – especially if Congress grants PTO full spending authority over its collected fees.

[Note – blue bar in 2014 shows the expected number of grants in the remaining four weeks of FY2014.]

 

Commil v. Cisco: Cert Granted as to Invalidity and Inducement Issues

Patent

By Jason Rantanen

Today, the Supreme Court granted certiorari on one of the questions presented in Commil v. Cisco.  (The order).  The question presented:

(1) Whether the Federal Circuit erred in holding that a defendant’s belief that a patent is invalid is a defense to induced infringement under 35 U.S.C. § 271(b);

Commil’s brief also presented a second question that the Court did not take:

(2) whether the Federal Circuit erred in holding that Global-Tech Appliances, Inc. v. SEB S.A. required retrial on the issue of intent under 35 U.S.C. § 271(b) where the jury (A) found the defendant had actual knowledge of the patent and (B) was instructed that “[i]nducing third-party infringement cannot occur unintentionally.”

Further discussion:

  • My summary of the Federal Circuit opinion is here: LINK
  • Dennis’s commentary on the cert petition is here: LINK

Ericsson v D-Link: Standards, Patents, and Damages

Patent, ,

By Jason Rantanen

Ericsson, Inc. v. D-Link Systems, Inc. (Fed. Cir. 2014) Download Ericsson v D-Link
Panel: O’Malley (author), Taranto (dissenting-in-part), Hughes

Standard Essential Patents (SEPs) are an integral part of the modern technological landscape.  As an example, Ericsson, the patent holder in this case, alleged that the patents at issue were essential to a common Wi-Fi standard, 802.11(n); thus all 802.11(n) compliant devices infringe the patents.  Due to their nature (they cover technologies whose widespread use can be as at least as much due to the adoption of the standard as the incremental value of the invention), SEPs pose particular issues when dealing with the question of remedies.

Two well-recognized problems are hold-up and royalty stacking.  “Patent hold-up exists when the holder of a SEP demands excessive royalties after companies are locked into using a standard. Royalty stacking can arise when a standard implicates numerous patents, perhaps hundreds, if not thousands. If companies are forced to pay royalties to all SEP holders, the royalties will “stack” on top of each other and may become excessive in the aggregate.”  Slip Op. at 7-8.  Organizations that develop standards, such as IEEE, typically address these potential problems by seeking pledges from their members “that they will grant licenses to an unrestricted number of applicants on “reasonable, and nondiscriminatory’ (‘RAND’) terms.”  Id. at 8.  Ericsson promised to offer such licenses for its 802.11(b) SEPs.

Background: In 2010, Ericsson filed an infringement suit against D-Link, accusing it of infringing a set of its 802.11(b) SEPs.  Ericsson prevailed at the district court, with a jury finding infringement of three patents, rejecting a validity challenge to one, and awarding Ericsson $10 million in damages (a royalty rate of $0.15 per product).  Based on the jury award, the judge found $0.15 per product to be an appropriate running royalty.  On appeal, the Federal Circuit affirmed enough of the district court findings as to liability for the issue to be one of damages.  (Judge Taranto dissented as to one of the infringement conclusions but agreed with the rest of the majority opinion).

Damages and SEPs: The below paragraph from the court’s opinion summarizes its key holdings on damages:

In sum, we hold that, in all cases, a district court must instruct the jury only on factors that are relevant to the specific case at issue. There is no Georgia-Pacific-like list of factors that district courts can parrot for every case involving RAND-encumbered patents. The court should instruct the jury on the actual RAND commitment at issue and must be cautious not to instruct the jury on any factors that are not relevant to the record developed at trial. We further hold that district courts must make clear to the jury that any royalty award must be based on the incremental value of the invention, not the value of the standard as a whole or any increased value the patented feature gains from its inclusion in the standard. We also conclude that, if an accused infringer wants an instruction on patent hold-up and royalty stacking, it must provide evidence on the record of patent hold-up and royalty stacking in relation to both the RAND commitment at issue and the specific technology referenced therein.

Slip Op. at 56.  The first sentence is probably the most widely applicable, and arguably applies beyond the RAND context.  It is legal error to simply recite the Georgia-Pacific factors in a set of jury instructions.  Courts must be cognizant of which factors actually apply in a given situation.  “Although we recognize the desire for bright line rules and the need for district courts to start somewhere, courts must consider the facts of record when instructing the jury and should avoid rote reference to any particular damages formula.”  Slip Op. at 50.

Of course, legal error in a jury instruction does not mandate reversal; that error must still be prejudicial.  Here, the errors were significant and in combination sufficiently prejudicial.  For example, some Georgia-Pacific factors are directly contrary to the RAND commitment, such as factor 4, “'[t]he licensor’s established policy and marketing program to maintain his patent monopoly by not licensing others to use the invention or by granting licenses under special conditions designed to preserve that monopoly.’ Georgia-Pacific, 318 F. Supp. at 1120. Because of Ericsson’s RAND commitment, however, it cannot have that kind of policy for maintaining a patent monopoly.”  Slip Op. at 48.

Another important piece of the court’s holding is its clarification of what the patent remedy must relate to in the context of SEPs: the “incremental value of the invention not the value of the standard as a whole or any increased value the patented feature gains from its inclusion in the standard.”  In other words, just as modern devices incorporate many different technological components, so too do standards include multiple technologies.  “Just as we apportion damages for a patent that covers a small part of a device, we must also apportion damages for SEPs that cover only a small part of a standard.”  Id. at 52.

Finally, on patent hold-up and royalty stacking, an accused infringer can obtain such an instruction but there must be record evidence: “The district court need not instruct the jury on hold-up or stacking unless the accused infringer presents
actual evidence of hold-up or stacking. Certainly something more than a general argument that these phenomena are possibilities is necessary.”  Id. at 54.

Sidley: Docket Text “Affirmatively Misled” us so None of the 18 Lawyers who Received It Needed to Read the Actual Orders

Ethics

All of this is based upon the oral argument from Tuesday.

Represented by Sidley, AT&T loses $40m verdict at trial.  The parties file post trial motions.  Sometime later, 18 lawyers at Sidley and its local counsel received notice that the district court had entered several orders.  Many were sealing and other administrative orders.  One was the denial of AT&T’s motion for judgment as a matter of law notwithstanding the jury’s $40m verdict against it.

No one read the orders — though apparently some folks billed as much as .25 an hour to reading the email — until about two months later, which was long past the deadline for appealing.  The district court denied relief to AT&T, basically saying that the text of a docket entry isn’t what matters; it’s the order, and lawyers have a duty to read every order. (That’s the gist.)

The appeal in Two-Way Media LLC v. AT&T was heard yesterday at the CAFC.  The oral argument is here.  It’s a fascinating listen:  two former trial judges (O’Malley and Wallach) were not sympathetic, at all, to Sidley’s position; Judge Dyk seemed to be bending over backwards to try to get one of those two to join him in granting some form of relief.

Stay tuned….  I’m guessing there will be either a rule 36 affirmance or a 2-1 decision with Dyk dissenting.

Law Firm: Because Third Party Patent Annuity Company Actually Missed the Deadline, We Can’t be Liable for Covering it up.

Ethics

According to the complaint described in Harrier Technologies, Inc. v. CPA Global Limited et al (No. 3:12-cv-00167-WWE (D. Conn. Dec. 2014), the patentee, Harrier, asserted that CPA Global had let Harrier’s Saudi Arabian patent lapse, and that Kenyon knew of the lapse and deliberately covered it up.  Kenyon asserted an indemnification claim against CPA Global. CPA Global moved to dismiss that claim for failure to state a claim.

Not surprisingly, the district court granted the motion:

Kenyon alleges that to the extent that any entity other than Harrier was responsible for the lapse of the Saudi patent application, CPA’s own negligence, rather than any other negligence, was the direct and immediate cause of that lapse. Here, however, Kenyon is not facing claims of negligence. Kenyon’s alleged wrongful concealment after the fact rather than any initial responsibility for the lapse is at issue through Harrier’s counts of breach of fiduciary duty (Count II) and fraud (Count III). Although Count II of Harrier’s complaint does allege that Kenyon breached its fiduciary duty to Harrier by, inter alia, failing to timely pay the annuity, such failure, as a matter of law, does not fall within the realm of fiduciary duty in Connecticut.  Simply put, the argument that CPA’s negligence in failing to renew the patent application was primarily responsible for Kenyon’s alleged dishonesty and deception toward Harrier cannot stand. CPA cannot have been in exclusive control of Kenyon’s alleged concealment and dishonesty to its client.  Moreover, if Kenyon is to be held liable to Harrier for concealing knowledge about the lapse of the Saudi patent application, and as Kenyon contends, CPA’s negligence caused the lapse, it would necessitate a finding that Kenyon knew of CPA’s negligence in causing the Saudi patent application to lapse. Therefore, Kenyon cannot satisfy the fourth element of a common law indemnification claim — that a party seeking indemnification did not know of the third-party’s negligence. Accordingly, Kenyon has failed to state a plausible claim for indemnification against CPA

(Citations omitted.)   (You can’t make this stuff up.)   The case is behind a paywall and not available outside of Pacer, unfortunately, but that is pretty much the substance.