A Rose by Any Other Name – or – It’s not Wrong it’s just Different

by Dennis Crouch

The bench was an active inquisitor in the Thryv v. Click-to-Call oral arguments held Dec. 9, 2020 before the U.S. Supreme Court.  This is the third post-AIA Supreme Court case focusing on the no-appeal provision of 35 U.8.C. § 314(d) (“determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable”).   [TRANSCRIPT]

Oral arguments focused on two major issues: (1) the extent that SAS limited Cuozzo; and (2) the importance of the time-bar since there are alternative fora for judging patentability and the patent is invalid anyway.

The first point — SAS limiting Cuozzo: In SAS (2018), Justice Gorsuch explained the holding in Cuozzo (2018) as follows:

Cuozzo concluded that § 314(d) precludes judicial review only of the Director’s “initial determination” under § 314(a) that “there is a ‘reasonable likelihood’ that the claims are unpatentable on the grounds asserted.

SAS. To be clear, if the no-appeal statute’s sole function is to block appeal of the reasonable-likelihood decision, then the decision is foreclosed in favor of the patentee (allowing appeal of the time-bar question).  However, as I suggested in a prior essay, I believe that Justice Gorsuch SAS opinion overstated Cuozzo’s holding. I suspect this was an intentional shading of Cuozzo made possible because of 5-4 split.  A smaller majority allows for a more extreme opinion.

This issue was ripe for discussion in the oral arguments with Thryv’s counsel Adam Charnes attempting to explain that Gorsuch’s SAS statement isn’t “wrong” per se, it just isn’t complete.  Charnes would obviously rather not require overturning of the Supreme Court’s most recent case on the subject in order to win.

JUSTICE GINSBURG: What do you do with the sentence in this Court’s SAS decision that says 314(d) precludes judicial review only of the Board’s initial determination under 314(a) that there is a reasonable likelihood that the claims are unpatentable?

MR. CHARNES: We think that that’s not a complete description of Cuozzo . . . .

JUSTICE GINSBURG: So you think that that was just a wrong sentence?

MR. CHARNES: I wouldn’t say it was wrong. . . . What I’d say is that the Court had no need to describe Cuozzo more broadly … because that was not the factual circumstance of SAS. …

JUSTICE KAVANAUGH: I think you are saying “it’s wrong,” to pick up on Justice Ginsburg’s question, at least the use of the word “only.”

MR. CHARNES: I think it’s not a complete description. I think that’s not the only basis that this Court explained in Cuozzo. I think that’s — that’s a fair point.

Justice Kavanaugh is the only new member of the court since SAS and his vote is likely critical to the outcome in this case. However, the most likely swing vote is Chief Justice Roberts.

The Gov’t attorney, supporting Thryv in its no-appeal argument and agreed that the SAS statement is wrong.

MR. ELLIS: (Representing the U.S. Gov’t and supporting the no-appeal argument)I do think that sentence is wrong, and I think it’s incomplete. . . . Cuozzo concluded more than that. And I think, if you look at the decision, you’ll see that.

The wrongness of Justice Gorsuch’s statement is potentially twofold: (1) it is clearly an unduly narrow statement of the holding in Cuozzo; and (2) it might also be an incorrect interpretation of the statute.  For me, this raises the interesting esoteric question about precedent and primary sources.  What is the precedential and stare decisis role of the Supreme Court’s (mis)description of its prior precedent.  Is the (mis)description now the leading precedent, or is it merely a secondary source helpful in interpreting the original decision.

Mr. Geyser has the easier case on these points — arguing that the patentee clearly wins under SAS, and should also win under Cuozzo.

MR. GEYSER: (Arguing for the patentee) We’re simply reading 314(d) to say exactly what this Court in SAS said it meant, which is it is limited to only the initial patentability threshold in 314(a).

My friend from the government now concedes that they think that [SAS] was wrong. I don’t believe they’ve asked this Court to overturn SAS. We don’t think that the Court was wrong.

JUSTICE KAGAN: Well, it’s not a question of overturning. It’s just — I think what they were saying is that SAS dealt with one issue in which it was unnecessary to recite Cuozzo’s full test, but Cuozzo has a broader test than SAS quoted.

MR. GEYSER: Well, to be very clear, I think that we win under Cuozzo as well, but I don’t think that the reasoning in that statement, which is a very plain statement in SAS, can be limited in that way.

[The “only” language in SAS] is an absolute part of the core holding of the case in rejecting what the government eventually framed as their primary submission in SAS.

The substantive issue on appeal in Thryv was the PTO’s interpretation of the time bar in § 315(b).  Although a lawsuit had been filed and served, the PTAB found that the time-bar was not triggered because that lawsuit had been dismissed without prejudice.  On appeal, the Federal Circuit found that the PTAB had misinterpreted the statute — holding that dismissal does not annul the time-bar.

The Patent Challenger and Government both argue that the a time-bar decision by the PTAB is not appealable. Justice Gorsuch pushed that question in an extreme example, and Charnes held his ground on no appeal:

JUSTICE GORSUCH: Let’s just hypothesize that someone has tried to undo this patent four times or maybe even more in a court of law, failed for various reasons every single time, and then comes to the director of patents, who has a political mission, perhaps, to kill patents, let’s just say. And it is clearly time-barred under the statute. Let’s just hypothesize that. And yet, the director goes ahead and does it anyway. Under your submission to the Court, I believe you’re saying that is a shenanigan this Court cannot review.

MR. CHARNES: It is correct that our submission is that’s not reviewable. The time bar is not reviewable.

JUSTICE GORSUCH: All right. The hypothesis, there’s no good faith, okay? The director of patent has a political desire for whatever reason to destroy this patent and many others. . . . In your circumstance, you’re telling the Court there’s no review of that decision, I believe, or maybe it’s not a shenanigan even in your — your view perhaps.

MR. CHARNES: Well, I think there is
— there is no review under — under 314(d). It may be that it’s an appropriate case for mandamus relief if the circumstances are as egregious as you suggest in your hypothetical. . . .

JUSTICE GORSUCH: So we’re going to just channel all these cases to mandamus? Is that — is that the upshot of your position?

MR. CHARNES: No, because mandamus is a rare relief. I mean, it would only be reserved for really egregious circumstances like your hypothetical.

JUSTICE GORSUCH: If the institution decision is not reviewable at all, how would it be mandamus-able? . . .

Mr. Ellis from the SG’s office added his two-cents with an argument along the lines of “you shouldn’t care about privacy if you have nothing to hide.”  In this case, his argument was that we shouldn’t worry since “you’re going to get review, judicial review of the patentability” question.

MR. ELLIS: What was open for review was that patentability analysis. Now Respondent opted not to challenge that patentability analysis. But, if it had merit, that would be judicially reviewable and then the patent wouldn’t be canceled.

This discussion takes us to the second general topic for discussion — is the time-bar a big deal.  In Cuozzo and in oral arguments here, the justices appeared reluctant to bar appeals of important issues such as due process violations and statutes of limitations.

CHIEF JUSTICE ROBERTS: Well, but, I mean, I don’t think it’s what we were fighting over at Yorktown. I mean, it’s just a question of whether — (Laughter.)

CHIEF JUSTICE ROBERTS: — as you said, the ultimate question, the ultimate issue that affects the property rights in a patent, it’s going to be reached. It’s just a question of whether you use one procedure or another. . . .

CHIEF JUSTICE ROBERTS: As I understand [Mr. Charnes] answer, at least part of it is more or less that this is small potatoes. It’s just about timing for — for the institution of the matter and that the basic issue of the patent validity is something you’re going to get to. You have a number of avenues to get to it.

The basic idea here is that even if the petition is time-barred, patentability could be raised in an ex parte reexamination or in a district court declaratory judgment challenge, or by a separate petitioner who was not time-barred:

CHIEF JUSTICE ROBERTS: [speaking about ex parte reexam] Well, it’s different, I’ll give you that, but, I mean, it’s focused on the same ultimate question. . . .

JUSTICE KAGAN: But if it’s not with
this Petitioner, it can be another Petitioner. . . And, indeed, even when a petitioner drops out under this statute, the Board can keep the proceeding going without the petitioner. So the fact that it is this Petitioner seems utterly unimportant under this statute.

Justice Ginsburg appeared to recognize that the time-bar is important:

JUSTICE GINSBURG: In Cuozzo, it was a particularity requirement, and that was described as a minor statutory technicality. But, here, we’re not dealing with a minor statutory technicality; we’re dealing with a time bar.

Justice Gorsuch provided a softball for the patentee’s counsel to answer:

JUSTICE GORSUCH: Well, I guess the question, though, that we’re struggling with is so what’s the big deal? If you’re stuck going to ex parte review anyway, why should we care? What’s your answer to that?

MR. GEYSER: … because inter partes review is a very different process than ex parte reexamination.

JUSTICE GORSUCH: Spell that out. Spell that out. Why?

MR. GEYSER: It’s because instead of having an opportunity for a single response, truncated discovery, you’re in an adversarial proceeding. You’re before a panel of three PTAB judges who might give you an hour oral hearing.

You get a long, iterative process with a talented patent examiner who can say this is what I think is wrong, and then you have lots of opportunities to show them exactly why
that concern is unfounded.

And, again, the PTAB is reversed a fourth of the time. It’s not like this process … is perfect or without error. . . .

JUSTICE KAGAN: It just doesn’t seem as though this petitioner makes all that much difference.

MR. GEYSER: Well, Congress felt otherwise in this heavily negotiated process that produced 315(b) as a fundamental safeguard for patents.

JUSTICE GORSUCH:  Why does it matter whether it’s one petitioner or another petitioner?

MR. GEYSER: To make sure that you don’t have someone gaming the system . . .

MR. GEYSER: And [Congress] understood that this [time-bar] is a significant protection for patent owners. And it’s a significant way to divide the authority between the courts on the one hand and the agency on the other.

There is a more detailed statutory interpretation question here — The no-appeal provision is directed to institution determinations “under this section” — i.e., Section 314, and the time-bar is found under Section 315 of the Code.  Under this “chapter”

JUSTICE KAVANAUGH: But “under this chapter” is used in the same provision [314(b)]. If we had “under this chapter” here [in 314(d)], that would solve your problem.

The petitioners here do a nice job of overcoming that argument and so I don’t see it as the basis for the decision, although the court may throw it in as an ancillary matter.

In the end, the case comes down to a strong presumption that agency decisions are subject to appeal in Federal Court. And, the question is whether congress did enough in the statute to overcome that presumption in this case.  Patentee’s counsel (who is aware of many cases) ended his arguments with an appeal to precedent and history:

MR. GEYSER:I would submit that I’m not aware of any case that this Court has ever decided that would find Article III review cut off entirely based on language as indirect as this.

We can look for a decision in this case in the Spring of 2020.  I am expecting a split opinion with the majority affirming — holding that the no-appeal provision has no force in this particular case.

CareDx v. Natera: A Response To Professor Holman

Guest Post by Edward Reines.  Reines Co-Chairs the nationwide Patent Litigation practice at Weil Gotshal. He represents CareDx and Stanford in the pending patent lawsuits.

Professor Holman’s recent post on the Federal Circuit’s CareDx v. Natera opinion is a thoughtful addition to Professor Crouch’s review of that decision.  Professor Holman concludes that the Stanford inventions were doomed from the start because they can be labelled as “molecular diagnostics methods” and are thus patent ineligible under Federal Circuit law.  Professor Holman’s conclusion is troubling.  It would limit the patentability of new inventions in an entire scientific discipline merely based on a label.

This labelling mode of analysis is fundamentally flawed because the Supreme Court’s Alice decision mandates a two-step test focused on the claimed advance of the patent, no matter the field of invention.  The test is designed to “distinguish between patents” that would pre-empt a field by broadly claiming “[l]aws of nature, natural phenomena, and abstract ideas” and patents that do not pose this risk because they add to these concepts with “human ingenuity.” There is thus nothing inherent about molecular diagnostics that precludes their patentability and merely labelling a method as “molecular diagnostics” should not be a kiss of death.

Take the Stanford patents.  Those patents document that the natural correlation between organ rejection and elevated levels of cell-free DNA of the organ donor was known for almost a decade before the inventions.   The patents then explain that numerous scientists motivated to measure that increase in cell-free DNA failed to come up with the patented measurement methods.   The patents cite an article published right before the Stanford patent filing that concluded that it was altogether “impractical” to measure cell-free DNA to monitor organ rejection.

The Stanford patents distinguish the failed prior art measurement efforts and describe new inventions on how to better measure cell-free DNA using advanced DNA analysis techniques.  The claimed inventions are better measurement methods that previously eluded the field – not the discovery of the natural correlation itself.  And there was no claim that they posed the pre-emption risk that animated Alice.

Federal Circuit law places at the heart of Alice step one whether the “claimed advance” is the natural law.  In CareDx, as Magistrate Judge Burke had originally concluded, the claimed advance of the Stanford patents is an improved human-devised measurement method.  The Federal Circuit’s opinion failed to properly focus on the “claimed advance” analysis and failed to squarely address that the patents describe numerous prior art failures. This prior art history is irreconcilable with the panel’s conclusion that the patented measurement methods are so conventional as applied to the natural correlation that they could not possibly qualify as patent-eligible human invention.

Instead, the Federal Circuit imported the “conventionality” analysis from step two into step one in lieu of a proper “claimed advance” analysis of Federal Circuit precedent.  As originally contemplated in Mayo, the “conventionality” analysis was akin to determining if the claims included mere trivial additions on top of discovery of a natural law.   Here, the conventionality analysis instead became a short-cut obviousness analysis.  Yet, even that fails because the decade of prior failures at measuring the cell-free DNA for a good organ rejection test proves that it was not conventional to use the patented measurement methods for this purpose – otherwise the many groups working on the problem would have arrived at that solution ultimately invented by the Stanford team.  And the supposed disclaimers in the patents never even suggest that applying the claimed measurement techniques to the tough context of cell-free DNA somehow was not an invention.  Everything about the description of the inventions is inconsistent with that conclusion.

The Federal Circuit cannot blame the Supreme Court for this latest constriction of molecular diagnostic patenting even though many Federal Circuit judges have bemoaned the stinginess of the Supreme Court’s Alice test in this area.  As explained long ago in Diamond v. Diehr, and as repeated in Bilski and Mayo, the Supreme Court recognizes that: “It is now commonplace that an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection.”  Even if the Stanford measurement methods were known (and the prior art history calls that into serious doubt) their application to a natural law can certainly be patent eligible if it is the product of human innovation, as claimed by the patents.

Professor Holman’s conclusion that the Federal Circuit labelling method may have controlled the CareDx outcome should give real pause to the patent law community.   Such labelling might be useful to describe the inventions at issue in prior decisions, but it is not a basis to proscribe whether an invention is eligible for patenting.   The Stanford patents are plainly directed to a better measurement method that evaded many motivated prior artists.  Such human innovation is the claimed advance and is patent eligible under Alice even if it can be labelled as a molecular diagnostic method.

The Many Mistakes in the Panel Decision in GS CleanTech Corp v. Adkins

By David Hricik, Mercer Law School

Over on the main page, Dennis has written up GS CleanTech Corp. and Cantor Colburn LLP v. Adkins Energy LLC (Fed. Cir. 2020) [Fed Cir Decision][DCT Decision] (does Dennis ever sleep?), which affirms a holding of inequitable conduct.

That finding can ruin careers.  Dennis examined the merits: I want to examine the procedure used on appeal. (I’ve taught civil procedure for decades now, and served as a clerk on the court a few years ago… this case is in need of correction by the full court or the panel on rehearing — whether it changes the outcome, or not, a point on which I have no view.) Whatever the merits, the panel mistates key issues of appellate review of inequitable conduct and contradicts prior panel decisions and even Therasense itself — and does so in a way that radically increases the scope of this equitable defense while, at the same time, failing to analyze the equities, oddly enough.

Specifically, first, the panel states the the standard of review of a fact finding of materiality underlying inequitable conduct  is for abuse of discretion. That is just flat wrong. “[W]e review the district court’s findings of materiality… for clear error.” Am. Calcar, Inc. v. Am. Honda Motor Co., 768 F.3d 1185, 1189 (Fed. Cir. 2014). Accord, Regeneron Pharm., Inc. v. Merus N.V., 864 F.3d 1343, 1351 (Fed. Cir. 2017).

Worse, invalidity “under the on-sale bar is a question of law with underlying questions of fact.” Robotic Vision Sys., Inc. v. View Eng’g, Inc., 249 F.3d 1307, 1310 (Fed. Cir. 2001). Accord, The Medicines Co. v. Hospira, Inc., 881 F.3d 1347, 1350 (Fed. Cir. 2018). The panel examines for abuse of discretion of, not just the underlying factual questions, but the legal question. That is wrong. Indeed, it applied abuse of discretion to whether the invention was ready for patenting, which is also wrong.

As stated,  reviewed the findings of intent to deceive for abuse of discretion: that’s wrong. “This court reviews the district court’s factual findings regarding what reasonable inferences may be drawn from the evidence for clear error.”
Therasense, Inc. v. Becton, Dickinson and Co., 649 F.3d 1276, 1291 (Fed. Cir. 2011)

And, third, the panel never (as the district court apparently failed to do) analyzed equitable balancing — given the circumstances should the entire patent be held unenforceable?  I’ve often observed that nothing in Therasense changed the rule that, if the accused infringer meets its burden of showing both materiality and intent, “then the district court must weigh the equities to determine whether the applicant’s conduct before the PTO warrants rendering the entire patent unenforceable.” Therasense, Inc. v. Becton, Dickinson and Co., 649 F.3d 1276, 1287 (Fed. Cir. 2011).

The panel applied the standard of review on the ultimate issue — equitable relief — to fact findings and legal conclusions. It’s a slippery slope, and one with severe consequences to the boundaries created by Therasense: it allows district courts to make clear errors on factual findings and legal conclusions, but be affirmed on appeal so long as they do not abuse their discretion. Finally and in addition, lack of careful appellate review will lead to OED investigations into practitioners, as well as ruined businesses and scientific careers.

Animated Design Patents

Guest Post by Sarah Burstein, Professor of Law at the University of Oklahoma College of Law

Wepay Global Payments LLC v. PNC Bank, N.A. (W.D.Pa. June 1, 2022) [wepayDecision]

Companies associated with William Grecia have filed over a dozen cases alleging infringement of design patents for “animated graphical user interfaces.” A judge in one of those cases, Wepay v. PNC Bank, recently issued a decision dismissing the case.

The patent asserted in that case, U.S. Patent No. D930,702, was issued in 2021 and claims a “design for a display screen portion with animated graphical user interface.” Wepay alleges infringement of the second embodiment, which includes three images:

Consistent with the USPTO’s rules for “changeable computer generated icons,” see MPEP § 1504.01(a)(IV), the patent specifies that, “[i]n the second embodiment, the appearance of the     sequentially transitions between the images shown in FIGS . 3 through 5. The process or period in which one image transitions to another image forms no part of the claimed design.” Consistent with the USPTO’s general drawing rules, the patent disclaims all matter shown in broken lines “form[] no part of the claimed design.”

So what does this patent cover? According to the court, Wepay seemed to think its patent covered any app with a QR code that lets you send money to other people:

WPG maintains that both its patent and the PNC app include an icon array of three squares that simulate a QR code; both cycle to a functional screen where the user may choose to whom the money will be sent; and both conclude with the display screen with a display of a zero value, where the user may input the amount of money that the user wishes to send.

The court rejected that interpretation—and rightly so. It’s well-established that design patents cover the visual designs that are actually claimed, not the larger design concepts.

The court held that the claimed designs and accused design, shown below as shown in the complaint, were plainly dissimilar and granted PNC’s motion to dismiss.

In doing so, the court recognized that placement and proportion matter in design, noting that “[a]ny similarity between the two designs is limited to basic geometric shapes, but with notable differences in shape size and spacing such that no ordinary observer would mistake the Accused Design with the Asserted Design or vice versa.”

Some may argue that the court erred in considering the placement and proportion of the claimed design fragments, because matter shown in dotted lines “forms no part of the claimed design.” But even if other visual portions of the design are disclaimed, that doesn’t mean courts have to treat the claimed portions as free-floating motifs. (Indeed, sophisticated design patent owner Nike has recognized that placement matters, even when dotted lines are used. See this PTAB decision at 10-13.)

I’ve explained here, placement and proportion are essential elements of design. The differences between the claimed and accused designs here are an excellent example of how different a single motif (e.g., each of the three squares in figure 3 and in the accused design) can look in the context of the design, depending on its proportion to the other elements and where it is located on the screen.

Before diving into the merits, however, the court expressed some doubt over whether infringement was even possible in this case:

[T]he Court notes that the ordinary observer test focuses on a hypothetical purchaser induced to buy a product with an accused design over an asserted design. The cases cited by the parties likewise address designs where there exists a consumer and/or purchaser at play. However, neither the cited cases nor this Court’s research reveals a case where, like the instant matter, the consumer has not voluntarily chosen the design at issue. Instead, the Accused Design is incidental to the PNC customers utilization of the mobile application. The Complaint does not allege that a purchaser would have been or has been involved with the Accused Design. Further, the Complaint does not allege a purchase or transaction by a consumer with regard to the Accused Design over the Asserted Design. Thus, the ordinary observer test would seem not to fit squarely with the designs at issue, and WPG would not be able to assert a design patent infringement claim.

Even though it’s dicta, the court’s suggestion that a design patent owner must plead “a purchase or transaction by a consumer with regard to the Accused Design over the Asserted Design” is worth further discussion.

Like other patents, a design patent is infringed when someone makes, uses, sells, offers to sell, or imports the patented invention without permission. The test for design patent infringement doesn’t change that. It just tells us when someone is making, using, selling, offering to sell, or importing the patented design.

The test for design patent infringement is a test of visual similarity. The “ordinary observer” part just tells us how similar the designs must be. (See this article at page 177.)

So, under current law, no sale is required, let alone—as the court seems to suggest—a direct sale to the end user, “with regard to the Accused Design over the Asserted Design.” Indeed, because there is no working requirement for design patents, there may not be a product embodying the claimed design available for sale.

All the defendant has to do is make (or sell, etc.) a product that looks “the same” as the claimed design. (For more on how the test for design patent infringement works, see this essay or Chapter 12 of this free casebook.)

Because Grecia-related companies have filed so many similar cases, it seems likely this decision will be appealed. It is definitely one to watch.

Guest Post: Out of the Blue: The Federal Circuit Devises a New Rule for Color Marks

Guest post by Christine Haight Farley (Professor, American University Washington College of Law and Faculty Director, Program on Information Justice and Intellectual Property).

The Court of Appeals for the Federal Circuit has held that color marks on product packaging can be inherently distinctive. On April 8, 2020, the court issued its opinion in In re: Forney Industries, Inc. It stated that “a distinct color-based product packaging mark can indicate the source of the goods to a consumer, and, therefore, can be inherently distinctive.”

Leaving aside the circularity of that statement—if it’s distinct it can be distinctive?—this holding lowers the bar for the acquisition of exclusive rights over colors. For the first time, color marks are instantly protectable (when used in commerce as a mark) and need not wait until they achieve secondary meaning, so long as they are used on packaging.

Because this ruling comes from the Federal Circuit it controls the how the Trademark Office deals with applications for color marks. Companies that want to acquire exclusive rights in colors now have a blueprint for how get a registration quickly: apply for a product packaging mark. So companies like Christian Louboutin should make those shoeboxes red!

The opinion was authored by Judge O’Malley joined by Dyk and Chen. The court reversed the TTAB, which had affirmed the trademark examining attorney’s refusal to register Forney’s mark.

In its use-based application (Serial No. 86269096), Forney identified its mark as a “color mark.” The mark, represented below, was applied for accessories and tools for welding and machining and described as follows: “[t]he mark consists of a solid black stripe at the top. Below the solid black stripe is the color yellow which fades into the color red. These colors are located on the packaging and or labels.”

Because Forney sought to register the mark without showing secondary meaning, the Examining Attorney refused registration on the principle register. Affirming, the TTAB, in a precedential opinion by Kuczma, held that “a color mark consisting of multiple colors applied to product packaging is not capable of being inherently distinctive.” It stated that Supreme Court precedent does not distinguish between color marks for products and color marks for product packaging; both require secondary meaning to be registrable.

Not a Gray Area

The Federal Circuit’s opinion reads like it thought it had carte blanche to write the rules in this area. It stated that “[t]he Supreme Court has [] provided several data points on inherent distinctiveness of trade dress.” (emphasis added) I’ve certainly never thought of the Supreme Court’s trilogy of cases on trade dress as data points; I always thought they were precedent. It later referred to these cases as “guideposts.”

Surprisingly, the Federal Circuit stated that “[a]lthough Qualitex implied that a showing of acquired distinctiveness may be required before a trade dress mark based on color alone can be protectable, it did not expressly so hold.” (emphasis added) This is just flatly wrong. The Qualitex Co. v. Jacobson Products Co. court did not “imply” the rule at all; it set it out in black and white:

over time, customers may come to treat a particular color on a product or its packaging … as signifying a brand. And, if so, that color would have come to identify and distinguish the goods–i.e. to “indicate” their “source”–much in the way that descriptive words on a product … can come to indicate a product’s origin.

In its subsequent decision in Wal-Mart Stores, Inc. v. Samara Brothers, Inc., the Court reconfirmed its rule: “with respect to at least one category of mark— colors—we have held that no mark can ever be inherently distinctive.” It also stated: “In Qualitex, . . . [w]e held that a color could be protected as a trademark, but only upon a showing of secondary meaning.” Nope, no innuendo.

Coloring Outside the Lines

The Federal Circuit stated that “Forney’s multi-color product packaging mark is more akin to the mark at issue in Two Pesos than those at issue in Qualitex.” That’s an odd statement given that the mark at issue in Two Pesos, Inc. v. Taco Cabana, Inc. was a restaurant, while the mark at issue in Qualitex was, wait for it, … a color! But the point here was that the Federal Circuit was judging Forney’s mark as a product packaging mark, as in Two Pesos, and not a product design mark, as in Qualitex. And that was its error.

Yes, Qualitex involved a product design mark, but the rule it announced was about color marks, not product design marks. Again, it stated: “over time, customers may come to treat a particular color on a product or its packaging … as signifying a brand. And, if so, that color would have come to identify and distinguish the goods.” (emphasis added). In anticipating color on “packaging,” the court made clear the holding was about color, not product design.

Black Sheep

The Federal Circuit’s decision here creates a new rule for color marks in product packaging. Although it states that it is “not the only court to conclude that color marks on product packaging can be inherently distinctive,” even the case it cites doesn’t support its new rule. It cites a 10th Circuit decision (Forney Industries v. Daco of Missouri), but that court explicitly stated “we hold that the use of color in product packaging can be inherently distinctive … only if specific colors are used in combination with a well-defined shape, pattern, or other distinctive design.” (emphasis added). The Federal Circuit stated that the 10th Circuit was “considering a mark very similar to the one at issue here,” but that statement may have involved a bit of whitewashing because the 10th Circuit case involved the very same mark owner and the same mark! The only difference was that the mark was described with more definition in the 10th Circuit case, and the court still denied protection.

Red Flag

To the extent this decision is read to hold that color marks on product packaging can be inherently distinctive; it is at odds with both Qualitex and Wal-Mart. Does that make it ripe for reversal by the Supreme Court? While decisions by the Federal Circuit often make the Supreme Court see red, the Court only grants cert. in trademark cases once in a blue moon. The government, however, has a strong record of having its cert. petitions granted. Recall that most doubted cert. would be granted in Brunetti. Another question is whether the government will even petition for cert. or instead decide not to go chasing rainbows.

True Colors

Is there a narrower reading of this decision? Perhaps the holding is only that certain multi-color product packaging marks that are sufficiently definite can be inherently distinctive. As a policy matter, a single color product design mark is much more problematic for competition than a multi-color product packaging mark is.

Even were the holding so limited, it still begins to undermine the policy orientation of Wal-Mart. It’s hard not to understand Wal-Mart as a course correction. Two Pesos’s holding that trade dress can be inherently distinctive did not foresee any of the problems it created. Although Qualitex further extended trade dress to include color, it did claw back a requirement of secondary meaning. The Wal-Mart Court finally saw the policy mess created by Two Pesos. It meant to build on Qualitex’s limitation, not scale it back. Qualitex saved colors from being inherently distinctive, and Wal-Mart saved product design. The Federal Circuit’s decisions pushes in the opposite direction, by narrowing Qualitex’s carve-out.

Unfortunately, the Federal Circuit is not clear that that its new rule is limited to multi-color marks. It simply states: “we hold that color marks can be inherently distinctive when used on product packaging, depending upon the character of the color design;” and “a distinct color-based product packaging mark can indicate the source of the goods to a consumer, and, therefore, can be inherently distinctive.” Requiring a color mark to be “distinct” is not filling any gaps left open by Qualitex, which specifically sated that the green-gold color was distinct for dry cleaning press pads. If the court had in mind a particular kind of color mark, it missed a golden opportunity to say so.

The rationale for both Qualitex and Wal-Mart was that, unlike product packaging, neither color nor product design prompt consumers to “equate the feature with the source.” Is there reason to believe that either multiple colors function more like product packaging than a single color, or that color on a product conveys something different than color on a package? If so, what do we make of the fact that Forney has been using its multi-color mark on packaging for more almost 30 years and yet chose to litigate in two different courts of appeal rather than simply demonstrating its secondary meaning?

More on the Patent Attorney Rolls

by Dennis Crouch

The USPTO Office of Enrollment & Discipline’s list of registered patent attorneys and agents includes 48,625 individuals. Since there are no annual dues, CLE requirement, or even check-in many folks continue to stay on the rolls even though they are not practicing patent law.  One example is my colleague Professor Royce Barondes who passed the patent bar exam prior to law school and then never practiced in the field. Instead, he practiced law at Cravath in NYC and now teaches business courses, contracts, and firearms law. I wanted to get a more accurate number of folks currently practicing in the patent prosecution area. Do do this, I downloaded and parsed through USPTO records for utility patent applications filed since mid 2018 and that have been made public. (Series codes 16 and 17).

The Totals: 26,756 practitioners are associated with at least one application filed over the past four years; with 23,793 associated with at least 10 different utility patent applications.  About 80% are attorneys with the remaining 20% being patent agents. The result here does not necessarily mean that all of these attorneys worked on patent prosecution because many firms use a comprehensive customer number that lists all registered attorneys in the firm’s patent group.  This leads to crazy situations like patent agent Maki Saitoh of Oblon being associated with 31,000+ laid open applications filed over the past 4 years.  In addition, we have some undercounting because some folks doing patent prosecution work are not listed in the customer number (e.g., often in house counsel will not be listed).

I mentioned Oblon above. Although Oblon is not in the top-25 of firms in terms of patent attorneys, they are the #1 filer of US patent applications followed closely by Sughrue.  They are able to file so many applications because most of their apps claim priority to a foreign or PCT filing — so they don’t need to write a new original application.  Some firms with lots of patent attorneys don’t do much patent prosecution work.  An extreme of this is Kirkland & Ellis that has over 100 patent attorneys but does not do any patent prosecution.

Seeking Transparency in Waco

The following short statement was written by Prof. Bernard Chao (Denver) and then joined by 20+ additional professors whose names are listed below.  Chao was a patent attorney and patent litigator for 20 years before becoming a professor and I have long valued his insight. You’ll note that I also signed below – DC. 

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Judge Alan Albright’s court in the Western District of Texas is rapidly becoming the latest hot spot for patent litigation. While only a total of two patent cases were filed in 2016 and 2017 in Judge Albright’s Waco federal courthouse, the number of patent filings rose to seven hundred and ninety-three (793) in 2020.  See J. Jonas Anderson & Paul R. Gugliuzza, Federal Judge Seeks Patent Cases, (forthcoming Duke L. J 2021). Professors Anderson and Gugliuzza provide a thorough explanation (and critique) of this sudden ascent. I have a smaller, but nonetheless important, point to make. If the Western District of Texas is going to hear some of patent law’s most important cases, it should not do so in secret. Unfortunately, that appears to have just what happened in one the highest dollar value patent trials in recent history.

The patent world has been abuzz about the $2.18 billion verdict that the Waco jury handed down on March 2, 2021 in VLSI Technology v. Intel. The public debate in patent law has often focused on whether courts and juries are getting patent damages right. Looking at relevant filings on damages provides critical information for this important discussion. In high stakes cases, parties typically file summary judgment motions on damages and Daubert motions attempting to exclude certain theories. These motions often attach expert reports and deposition testimony as exhibits. Together these documents illustrate how patent doctrine shapes damage awards. For example, filings often explain how the parties seek to apportion damages between the value of the infringing features and the product as a whole. This is not an easy task and parties have taken many approaches to apportionment with varying levels of success.

However, these documents cannot be retrieved from the VLSI Technology v. Intel docket. To be clear, sealing is appropriate in some instances. Companies should be able to keep their confidential technical and financial information under wraps. But at least as of March 15, 2021, the following docket entries were wholly unavailable (i.e. not even redacted copies were available).

Docket No. Date Title (some abbreviated)
431 2/18/2021 Sealed Document filed: Defendant’s Response to Plaintiff’s Daubert Motions to EXCLUDE DAMAGES-RELATED TESTIMONY OF INTELS EXPERTS

Two short orders granted motions to seal these filings. However, the sealed filings appear to go far beyond damages. The first order (dated October 8, 2020) granted roughly thirty motions (Docket Entries 214-244) and the second order (dated February 18, 2021) granted even more (Docket Entries 287-89, 293-319, 321-345, 374-381, 398, 404, 405, 410, 416. 418, 420, 424, 425). Many of the sealed motions are motions in limine that do not have a descriptive title.  They are simply numbered (e.g. Motion In Limine #3).  So, there is no way to even know what subjects they cover.

Judge Albright did give a small nod to transparency in his February 18, 2021 order which required “[t]he filing party shall file a publicly available, redacted version of any motion or pleading filed under seal within seven days.” Unfortunately, the redacted versions do not appear to have been filed.  A few days earlier, Judge Albright also issued a February 12, 2021, standing order that requires parties to do the same in all cases pending in his court.

But these orders are inadequate in several ways. First, they explicitly permit parties to file purportedly confidential information under seal without a motion. But the parties have no incentive to be transparent. It is the court’s job to protect the public interest, and this order abdicates that duty.  Second, there also appears to be no safeguard for parties that redact too much information in their filings, a problem we have seen before. See In re Violation of Rule 28(D) (Fed Cir. 2011)(sanctions for redacting information that was not confidential including case citations).  Third, the order does not require parties to redact exhibits. But some of the most critical information like deposition testimony and expert reports are exhibits. Finally, the order is not retroactive allowing most of the VLSI v. Intel case to remain in the dark.

This is not the first time that patent litigation has suffered from transparency problems. Other district courts have allowed too many documents to be sealed in previous high stakes cases like Broadcom v. Qualcomm (S.D. CA) and Monsanto v. Dupont (E.D. MO).  See, Bernard Chao, Not so Confidential: A Call for Restraint in Sealing Court Records, 2011 Patently-O Patent L.J. 6 & Bernard Chao & Derigan Silver, A Case Study in Patent Litigation Transparency, 2014 Journal of Dispute Resolution 83.

While these stories appear to paint a bleak picture for transparency in patent litigation, some courts are making an effort to keep their dockets accessible to the public. There have been notable decisions to ensure that filings are accessible. For example, in 2016 the Electronic Fronter Foundation successfully intervened and obtained an order from the E.D. of Texas to unseal records in a patent case, Blue Spike LLC, v Audible Magic Corp.  Earlier this month, the Federal Circuit, affirmed a lower decision rejecting attempts to seal specific filings in another patent dispute. See DePuy Synthes Products Inc. v. Veterinary Orthopedic Implants (Fed. Cir. Mar. 12 2021).

Moreover, individual court rules are now requiring greater transparency. The Federal Circuit’s latest rules clearly seek to maximize public disclosure. In each filing, Rule 25.1(d) only allows parties to mark “up to fifteen (15) unique words (including numbers)” as confidential.  A party seeking to exceed that limit must file a motion. As Silicon Valley’s home venue, the Northern District of California entertains numerous patent cases.  The court’s local rules say that material may only be sealed when a request “establishes that the the document, or portions thereof,  are privileged, protectable as a trade secret or otherwise entitled to protection under the law.”  Moreover, the request must “must be narrowly tailored to seek sealing only of sealable material.”  Ironically, even Texas state courts, which obviously do not hear patent cases, treat requests to seal far more seriously than the W.D. of Texas.  Specifically, Texas Rule of Civil Procedure 76a states that court records are “presumed to be open to the general public”, and only allows records to be sealed upon a showing that “a specific, serious and substantial interest which clearly outweighs” various interests in openness.

In short, the Western District of Texas should join these other courts and take its duty to ensure transparency seriously. As the Fifth Circuit recently put it , “[w]hen it comes to protecting the right of access, the judge is the public interest’s principal champion.” Binh Hoa Le v. Exeter Finance Corp. (5th Cir. Mar. 5, 2021). Accordingly, we make a few basic recommendations.  First, parties should not be able to file material under seal without judicial scrutiny. They should be required to file motions and justify their requests. Of course, a court also cannot rubber stamp these requests. If resources are a problem, the court can appoint a special master in larger cases. Second, parties should have to redact exhibits too. There can be valuable non-confidential information in those exhibits. Finally, a quick aside, even though judges bear the primary responsibility for making their dockets transparent, that does not mean the parties should not show more restraint. To the extent that either side is a repeat player, and thinks the patent system needs reform, they should be careful not to over seal. Their filings might end up being important contributions to the public debate.

Signatories (more…)

Patent Claims as Elements rather than Boundaries

By Jason Rantanen

I teach Introduction to Intellectual Property Law every spring semester, an experience that often causes me to reflect on some of the fundamental premises of intellectual property law in a way that advanced courses don’t necessarily always invite.  When you’re deep in the nuances of the effective date provision for post-AIA § 102, it’s easy to lose sight of some of the big questions.  This post is one of a few half-baked ideas from that return-to-basics reflection.


I grew up steeped in the world of property law.  My father’s law office was in rural New York, and his core practice involved representing farmers, villages, and small businesses on land transactions, estate planning, and probate matters.  Some of my first memories are of photocopying property abstracts: voluminous documents that contained the transaction history for a property, often going back a hundred years or more.  We’d copy these abstracts and then affix the new deed or mortgage associated with the transaction.  Later, I learned to type up property descriptions for deeds, writing out the metes and bounds of the land being transferred.  These descriptions  used points and lines to articulate the land for which the property rights applied.

For me, the language of patent claims as boundaries resonated early and easily.  After all, patent cases routinely refer to claims in boundary-like terms.  One example is the likening of claims to “metes and bounds,” as Judge Rich did in footnote 5 of In re Vamco Machine and Tool, Inc., 752 F.2d 1564, 1577 (Fed. Cir. 1985).

The function of claims is (a) to point out what the invention is in such a way as to distinguish it from what was previously known, i.e., from the prior art; and (b) to define the scope of protection afforded by the patent. In both of those aspects, claims are not technical descriptions of the disclosed inventions but are legal documents like the descriptions of lands by metes and bounds in a deed which define the area conveyed but do not describe the land.

Another example is this passage from Judge Michel’s opinion  in Halliburton Energy Services, Inc. v. M-I LLC, 514 F.3d 1244, 1249 (Fed. Cir. 2008):

Because claims delineate the patentee’s right to exclude, the patent statute requires that the scope of the claims be sufficiently definite to inform the public of the bounds of the protected invention, i.e., what subject matter is covered by the exclusive rights of the patent. Otherwise, competitors cannot avoid infringement, defeating the public notice function of patent claims.

Patent law scholarship, too, treats patent claims as if they are boundary-setting.  Books and articles refer to modern claiming practice as “peripheral claiming”– language that implies an area that is within and that which is without.  Even those scholars who have critiqued the idea of peripheral claiming nonetheless visualize patent claims as defining an area: signposts instead of fenceposts.  The idea is still that there is a zone set by the patent claim.

And yet, the more I’ve litigated, studied, and taught about patents, the more I’ve realized that conceptualizing patent claims as defining an area is fundamentally wrong.  Patent claims are not boundaries, and it’s confusing to those who are trying to grasp patent law when we talk about them that way.  There is no area that is “encompassed” within patent claims.  Patent claims don’t define a “boundary.”  And they are quite unlike the metes and bounds of a deed description.  Even if one could plot the components of a patent claim in some n-dimensional space, it would still not define a closed form.  Conceptualizing patent claims as if they define some “area” of technology isn’t how they actually work. One cannot draw a line from one claim element to another, except in the sense that claim elements can interrelate with one another–but that, too, is really just another element, albeit one that is implicit from the semantic structure of the claim rather than explicit in its words.

So how should patent claims be conceptualized, if not as establishing a boundary?  My first answer goes back to how litigants and courts often actually approach them: as discrete legal elements akin to the elements of any other legal claim.  The limitations in patent claims aren’t like the boundaries defined in a deed; instead, they are like the elements of a tort.  Each of these elements must be met in order for the claim to be infringed, invalidated, or adequately supported by the disclosure.

Consider, for example, patent law’s novelty requirement.  In order for a prior art reference to anticipate a patent claim, each and every element of the claim must be present in the prior art reference.  Or the analysis for infringement: for there to be infringement, each and every element of the claim must be present in the accused product or process, either literally or as an equivalent.  In both cases, patent claims are treated as if they are a series of elements–not as boundary lines that are crossed or not.  They are, in the words of Nolo’s Plain-English Law Dictionary, “the component parts of a legal claim.”

In the end, despite my initial attraction to the language of real property to describe patent claims, I’ve come to realize that this rhetorical device–enshrined in patent law judicial opinions and used in briefs and legal scholarship–is both misleading and wrong.  Patent claims are not boundaries, and we should stop referring to them that way.  Instead, they are elements in their legal sense: sets of individual legal requirements that must each be proven to achieve a particular legal status.

Perhaps this is so obvious that it doesn’t need to be said.  And yet, for those who are learning patent law for the first time, it is hardly obvious – particularly when the opinions that we read talk about patent claims in boundary-like terms.


Thoughtful, non-repetitive comments welcome.  Comments that I think are crud or junk, in my subjective opinion, will be deleted without further notice or comment.


Vestigial Use

by Shubha Ghosh, Crandall Melvin Professor of Law and Director, Syracuse Intellectual Property Law Institute

As companies voluntarily retire their offensive trademarks, two questions tug at whatever passes for a conscience nowadays.  First, can these undesirable marks come back, revived by whomever sees a market niche for these symbols? This may seem like a ridiculous possibility, but on June 21, 2020, an Intent to Use Application was filed  on the word mark “Aunt Jemima” by Retrobrands, a Florida LLC, whose mission “is to revive ‘abandoned’ consumer iconic brands and to bring them back to the marketplace.” The second question is, do these intellectual property mea culpas do any good in the face of companies like Retrobrands and the entrenched nostalgia it represents?  After all, gallons of maple syrup were transformed into Benjamins, even more Tubmans, over the years. Should not there be some disgorgement in the form of reparations?

The proposed doctrine of vestigial use under federal trademark law can address both questions. As described below, vestigial use can prevent trademark abandonment, which would potentially allow some enterprising cultural chauvinist from appropriating the mark. Vestigial use, as applied, can also provide a new revenue source that can finance the necessary reparations.

A vestigial use is the use of a mark to maintain the memory of a brand. Instead of offensive symbols littering the shelves of your local grocery store, they can be relegated to a museum. The idea would be similar to that of Budapest’s Memento Park, where the brutalist statues  from the Soviet era have a fitting resting place, about a forty minute bus ride from the Budapest bus terminal in a rural outskirt more habitable than Siberia but just as overlooked. Memento Park is a reminder of ideas gone woefully wrong.

Vestigial use would allow a trademark owner to continue using a mark without completely abandoning it. A trademark owner can claim continued use of the mark as a curator with the once fully commercialized mark relegated to a virtual museum. Retired offensive marks would be hidden away, but still can serve as a reminder of what was once bought and sold freely in the United States.  History is neither erased nor glorified. Instead, these marks become objects of study, specimens of bigotry past and continuing. These vestigial marks would have a place on a pedestal much like Uncle Tom’s Cabin, Huckleberry Finn. The Yellow Wallpaper, Native Son, and To Kill a Mockingbird have a protected place in public libraries. Like these books, vestigial marks benefit the public through their presence, serving as the occasional fodder for those who like to ban cultural relics and as a constant memento of a persistent ugliness.

I envision vestigial use as a judge-made doctrine, although with some imagination an appropriate statute could be drafted. It would allow trademark owners to defeat a claim of abandonment by someone who seeks to take up the mark. Under section 1127 of the Lanham Act, abandonment occurs when a mark’s “use has been discontinued with intent not to resume such use.”  The provision defines use as “the bona fide use of such mark made in the ordinary course of trade, and not made merely to reserve a right in a mark.” If vestigial use were adopted, a trademark owner’s showcasing the history of the mark would count as bona fide use. For offensive marks, owners like Quaker Oats, or its licensees, could create the equivalent of a Memento Park while blocking others from adopting the mark for full profit-making branding.

Vestigial use is necessary because failure to commercialize the mark may constitute abandonment under current doctrine. If Quaker Oats used the Aunt Jemima mark solely as a museum relic, that would most likely constitute a discontinuation of the mark “with an intent not to resume such use.”  Under the Lanham Act, use requires the goods labelled with the mark “are sold or transported in commerce.” Vestigial use of the mark would not require sales or transportation in commerce in the traditional sense. In fact, vestigial use presumes the mark is removed from the national mass market associated with the establishment of trademark rights. However, an archival use entails interested viewers going towards the trademarked product much like visitors to a museum. Instead of many products transported to purchasers, vestigial use entails many purchasers travelling to view the archived mark. The mapping is not from many marked goods to many purchasers but from many viewers to the one marked product.

As far as analogies go, this is admittedly a stretch. But if trademark law is about creating and protecting associations, it is not completely clear why the law’s protection should be limited to the many products going out to many buyers. First, there is nothing sacred about many to many; trademark law protects marks on niche products, even in markets with a few consumers. It is also not clear why the transportation has to be from product to buyers. Trademark law protects marks on websites which are unique objects which attract buyers.  The transportation requirement under the statute encapsulates the many consumers going to a single branded product. Vestigial use is a possible interpretation of the statute.

But possible does not mean highly probable. Courts may be hesitant in reinterpreting the use requirement to make it ostensibly easier to obtain rights. My proposal, however, is limited to applying vestigial use as a limitation on abandonment as opposed to lowering the use requirement for registration or demonstrating ownership. Potential evisceration of the public domain may also be the concern. Vestigial use sounds like warehousing of marks. But the proposal requires some affirmative act of the mark holder, namely a memorial or curated use. Furthermore, the public domain is a strange status under trademark law. An abandoned mark is not really in the public domain. As Professor Gerhardt argues in her blogpost, Quaker Oats would have rights under 1125(a) against companies like Retrobrands. Vestigial use is designed to prevent new users from fully recapturing supposedly abandoned marks.

Picking up on the public domain point, some policy makers may turn to genericide as the appropriate doctrine to put these offensive marks to rest. Arguably the racial stereotypes underlying “Aunt Jemima” or “Eskimo” are generic signifiers for outdated and commonly understood denigrating tropes. However, genericide means that the mark refers to the genus to which a product belongs, not about the signification of marks. Consequently, genericide is not practically suited to put to rest generically offensive marks.

Even if the proposed doctrine of vestigial use is unconvincing, analyzing it reveals the underlying problem. One reason for posts like this is that the Supreme Court’s decision in Tam rules out the possibility of denying registration or other trademark protections to offensive marks. According to the Court’s logic, “Aunt Jemima” is just another viewpoint under the First Amendment, and viewpoints do not ever really disappear. Their persistence is evinced by companies like Retrobrands and the recurring terms of the current public discourse. Vestigial use acknowledges the persistence of offensive discourse, despite all good intentions. Appropriating this persistence through trademark protection for memorial uses is a reminder of the terms of the cultural and political debate, Memory may at some date lead to the substantive economic and political reforms needed to combat inequality and bigotry.  Marks are never dead, and the past is never past, even if undistinguished.

Allen v. Cooper: Suing States for IP Infringement

by Dennis Crouch

Allen v. Cooper (Supreme Court 2019)

In this copyright case, the Supreme Court is wrestling with the question of sovereign immunity.  Does the 11th Amendment shelter States (North Carolina in this case) from copyright infringement lawsuits.  The plaintiff  — Frederick Allen — documented the 1998 salvage of the Pirate Blackbeard’s ship Queen Anne’s Revenge that sank near the North Carolina coast in 1718.  North Carolina wanted to use Allen’s copyrighted material, but didn’t want to pay.  The state legislature stepped in with “Blackbeard’s Law” — designating all photos, videos, and other documentary materials of shipwrecks to be public records. Allen then sued N.C. for infringement (Cooper is N.C. Governor).

In the background is the Copyright Remedy Clarification Act (CRCA) of 1990 that expressly abrogates state immunity in the area of copyright law:

Any State … shall not be immune, under the Eleventh Amendment [or] any other doctrine of sovereign immunity, from suit in Federal Court … for a violation of any of the exclusive rights of a copyright owner….

17 USC 511(a).  The basic question in the case is whether CRCA is unconstitutional:

Whether Congress validly abrogated state sovereign immunity via the CRCA in providing remedies for authors of original expression whose federal copyrights are infringed by states.

In some ways this case can be seen as a follow-on to Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, 527 U.S. 627 (1999).  In that patent case, a 5-4 Supreme Court held that Congress had improperly authorized patent infringement lawsuits against States. The area of law has seen further development since 1999, including an important bankruptcy-related decision in Central Virginia Community College v. Katz, 546 U.S. 356 (2006).

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The Supreme Court held oral arguments in the case on November 5, 2019.

Allen’s basic argument is that state immunity is inconsistent with constitutional power of “securing … exclusive rights.” Further, the 14th Amendment is seen as providing additional power to Congress to ensure that each state provides due process and equal protection. However, the Supreme Court requires actual constitutional violations before Congress can legislate in this area. [Oral Argument Transcript]

Arguing on behalf of the copyright holder, Derek Shaffer explains:

MR. SHAFFER: Exclusive against whom, Your Honors? Exclusive against all comers, exclusive against the world, including the government and including states.

The key problem with N.C.’s argument is that it goes against the Court’s reasoning in Florida Prepaid.

JUSTICE GINSBURG: All — all that is — would be highly persuasive if we didn’t have the patent decision, the Florida Prepaid decision. It is the very same clause. It’s the very same secure. It’s the very same exclusivity.

MR. SHAFFER: Correct, Justice Ginsburg. But the Court was not examining the text. The Court was not examining the clause. . . . That wasn’t before the Court. It wasn’t even raised before the Court.

JUSTICE KAGAN: If you are right, we would then have to go back to Florida Prepaid, right, and topple that rule?

MR. SHAFFER: It would be certainly open to folks in patent cases to make that argument, Justice Kagan.

JUSTICE ALITO: So, basically, you’re asking us to overrule Florida Prepaid?

MR. SHAFFER: I’m asking this Court to follow Katz, Justice Alito, where I think Florida Prepaid was [already] overruled. [See Central Virginia Community College v. Katz, 546 U.S. 356 (2006) (Does the Bankruptcy Clause of the U.S. Constitution (Article I Section 8), waive the states’ sovereign immunity?)]

Arguing on behalf of N.C., RYAN PARK added his thoughts:

JUSTICE ALITO: Mr. Park, can I take you back to the interesting suggestion that perhaps Congress could have justified what it did in this act by saying that we predict that a high percentage of copyright infringements are intentional and, therefore, violate due process. If we were to accept that, is there any reason why the same reasoning would not apply in patent litigation?

MR. PARK: No, I don’t believe there is any — any distinction there. [DC: note, this is wrong since patent law does not have a copying requirement.]

Due Process and Takings are not expressly raised in this case are interesting.  Even without CRCA, a copyright holder may be able to bring a Federal Due Process or Takings case against a state who infringes the copyright.  A major difference here is that copyright damage and injunction statutes go far beyond what is required for a due process violation or taking. Mr. Park explained for the State how the copyright-owner friendly damage regime is one reason to protect sovereign immunity (and taxpayer money).

MR. PARK: My friend has failed to identify any historical evidence that anyone at the founding remotely contemplated that the intellectual property clause would allow for damages lawsuits against states. . . . Congress could not commandeer state legislatures and force them to pass copyright protective laws, nor could they, under separation of powers principles, vest judicial review of copyright claims in the Senate Judiciary Committee. And, likewise, state sovereign immunity limits Congress’s authority to expose state treasuries to the Copyright Act’s exorbitant financial remedies. . . . And liability under the Act is expansive. It’s vastly greater than anything required by the Due Process Clause. It includes statutory damages of up to $150,000 per infringement, even if the plaintiff cannot prove she suffered any actual harm. . . .

JUSTICE BREYER: [For N.C. to win] we’ve got to decide how copyright, copying, and the due process clause fit together, which, to my knowledge, this Court hasn’t really gone into. And it sounds like a pretty good mare’s nest.

From the copyright holder’s perspective, the damage award is inherent to the copyright clause:

MR. SHAFFER: Clearly the framers’ contemplation is these are exclusive rights that anyone who may infringe has to pay for.

JUSTICE SOTOMAYOR: — the latter part you’re assuming. It says securing the copyright, but it doesn’t say making sure that the copyright owners are paid.

MR. SHAFFER: To promote progress. To promote progress, Justice Sotomayor. It is a preamble that is not echoed anywhere else in Article I.

JUSTICE SOTOMAYOR: Some would say that injunctive relief promotes progress.

MR. SHAFFER: James Madison’s conception reflected in the text of what the monopoly would achieve is that the authors and inventors would get paid for their inventions. They would get paid for their creations. And as the Court, as I indicated, back in 1888 recognized, it is antithetical to that to say that government of any kind, certainly the federal government, can infringe those exclusive rights that — that Congress is to be securing.

Justices Kavanaugh and Breyer finally focused on potential realistic outcomes of the case — rampant state infringement?

JUSTICE KAVANAUGH: Justice Breyer’s point is that it could be rampant, states ripping off copyright holders. And how can that be squared with the exclusive right, if states can do this, which presumably a ruling in [N.C’s] favor will do nothing but encourage them to do?

I’m looking for a decision in the case in early 2020.

Copyright and Transformative Fair Use

by Dennis Crouch

On October 12, 2022, the Supreme Court will hear oral arguments in the fair use copyright case of Andy Warhol Foundation, Inc. v. Goldsmith, Docket No. 21-869 (2022).  Roman Martinez (Latham Watkins) is set to argue for Warhol and Lisa Blatt (Williams Connolly) for Goldsmith.  The Court is also giving 15 minutes to Yaria Dubin (USDOJ) who also filed a brief supporting Goldsmith.

Andy Warhol admittedly used Lynn Goldmith’s copyrighted photographs of Prince as the basis for his set of sixteen silkscreens. Warhol’s Estate argues that the artworks represent a commentary on the dehumanizing nature of celebrity whereas the Goldsmith photos merely reflect Prince in his unique human form.

The Supreme Court has taken-up the case to consider the extent that the doctrine of transformative fair use should value “differences in meaning or message,” especially in cases where the works share core artistic elements and have the same purpose.

Question presented: Whether a work of art is “transformative” when it conveys a different meaning or message from its source material (as the Supreme Court, U.S. Court of Appeals for the 9th Circuit, and other courts of appeals have held), or whether a court is forbidden from considering the meaning of the accused work where it “recognizably deriv[es] from” its source material (as the U.S. Court of Appeals for the 2nd Circuit has held).

Although Andy Warhol is dead, his art, legacy, copyrights, and potential copy-wrongs live on.  In the 1980s, Warhol created a set of silkscreens of the musician Prince. Prince did not personally model for Warhol. Rather, Warhol worked from a set of studio photographs by famed celebrity photographer Lynn Goldsmith. Vanity Fair had commissioned Warhol to make an illustration for its 1984 article on Prince. As part of that process, the magazine obtained a license from Goldsmith, but only for the limited use as an “artists reference” for an image to be published in Vanity Fair magazine. The published article acknowledges Goldsmith.  One reason why the magazine knew to reach-out to Goldsmith was that her photos had also previously been used as magazine cover-art. Warhol took some liberties that went beyond the original license and created a set of sixteen Prince silkscreens. Those originals have been sold and reproduced in various forms and in ways that go well beyond the original license obtained by Vanity Fair.  (Warhol was never personally a party to the license).

Warhol claimed copyright over his artistic creations and his Estate continues to receive royalty revenue long after his death in 1987. Goldsmith argues that her copyrighted photographs serve as the underlying basis for Warhol’s art and that she is owed additional royalties. After unsuccessful negotiations, Warhol’s Estate sued for a declaratory judgment and initially won. In particular, the SDNY District Court granted summary judgment of no-infringement based upon the doctrine of transformative fair use. The district court particularly compared the works “side-by-side” and concluded that Warhol’s creation had a “different character, a new expression, and employs new aesthetics with [distinct] creative and communicative results.”  This test quoted comes from another famous a photo-transformation case, Patrick Cariou v. Richard Prince, 714 F. 3d 694 (2d Cir. 2013).

Richard Prince had modified Cariou’s photographs of a Jamaican Rastafarian community and exhibited his work as “appropriation art.”  The copier eventually won, with an appellate holding that the majority of Richard Prince’s works were clearly transformative in their newly presented “aesthetic.” In that case, the 2nd Circuit also held that the new work can still be a transformative fair use even if not a “satire or parody” of the original work, or even be commenting on the original work in any way. That said, uses of someone’s copyright work for a the purpose of parody, news reporting, comment, or criticism make it much more likely that the use will be deemed a fair use.

After losing at the district court, Goldsmith appealed to the Second Circuit who reversed and instead concluded that Warhol’s art was “substantially similar to the Goldsmith Photograph as a matter of law” and “all four [fair use] factors favor Goldsmith.”  The appellate court warned against too broadly reading its prior Cariou decision.

Warhol’s key legal precedent on point is Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569 (1994).  Campbell involved 2 Live Crew’s parody of the famous Roy Orbison song “Oh, Pretty Woman.”  The unanimous decision by Justice Kennedy delves into the first statutory fair use factor (“purpose and character of the use”) and distinguishes between (a) uses that simply replace or supersedes the original work and (b) those that are transformative of the original work. The more transformative a work, the more likely that it will be deemed a fair use and thus not infringing.  Campbell goes further and explains that transformativeness is not solely about new expression—it is also focused on whether the new work has “a further purpose or different character, altering the first with new expression, meaning, or message.”

Goldsmith argues that transformative meaning is only one element of a wide-ranging fair use analysis appropriately conducted by the Second Circuit.  As the Supreme Court recently explained in Google v. Oracle decision, the process is a “a holistic, context-sensitive inquiry” operating without any “bright line rules.”

The Copyright Act promises the original creator some amount of control over similar and follow-on works. In fact, the copyright owner is given exclusive rights to control preparation of any “derivative works based upon the copyrighted work.” For Warhol to rely entirely upon transformativness for his fair-use defense, the use must be so transformative as to leap beyond these derivative use rights.  Still, Warhol argues that the Second Circuit erred by refusing to give weight to the transformed “meaning or message” even if underlying elements of his artwork were similar to elements of the original photographs. As the Court wrote in Campbell, transformative uses “lie at the heart of the fair use doctrine’s guarantee of breathing space within the confines of copyright.” Warhol’s particular complaint with the Second Circuit is its apparent ruling that “a new work that indisputably conveys a distinct meaning or message” will still not be deemed transformative if its expression unduly retains “the essential elements of its source material.” Warhol argues that legal conclusion was recently rejected by the Supreme Court  in Google. Goldsmith responds that Warhol is misreading the Second Circuit’s decision – making a caricature of its holding.  Rather, Goldsmith argues, the Second Circuit properly weighed all the fair use factors. Further, although “message and meaning” is an aspect of fair use, it not found in the statutory nor intended by its creator (Judge Leval) to fully explain fair use.

Goldsmith also cites a list of historic cases where “conveying new meanings or messages did not save infringers.” One famous case is the Supreme Court’s 1884 decision in Burrow-Giles Lithographic Co. v. Sarony involving a photograph and lithograph copy of the famous playwright Oscar Wilde. Sarony was the first Supreme Court case confirming copyright protection in photographs. Goldsmith notes that the lithographer made a number of stylistic changes to Wilde’s appearance—shifting Wilde’s gaze from a “thousand-yard stare [of a] calculated ennui” to a “soulful gaze and brooding eyebrows [of a] dashing poet.” Despite these shifts, everyone seemed to agree that infringement was clear: “the lithograph was so obviously nontransformative the lithographer did not even try to raise fair use.” Goldsmith’s description of the images of Wilde has the reverb of a pedantic academic art critic—and one may suspect that tone was strategic in order to demonstrate the potentially ridiculous nature of the inquiry into the “message and meaning” of artistic works.

A large number of amicus briefs were filed in the case. The most important of these is likely the brief of the Solicitor General filed on behalf of the U.S. Government (Biden Administration).  The government brief focuses on transformative-use and notes that the Goldsmith and Warhol works have been used for the same purpose (republication in magazine articles about Prince) and do not involve a parody. In this same-use scenario, fair use is much less likely because the new work can be seen as little more than a replacement of the original. Regarding the meaning or message intended by Warhol, the government argues that Warhol failed to explain why he needed to reproduce Goldsmith’s work in order for that expression to take place. Thus, the government is attempting to cabin-in the transformative meaning doctrines to areas where the copying is further justified by reasoning or evidence.

The case’s impact on appropriation art and documentary filmmaking is easy to see, but there are other areas that may also see some big shifts depending upon the Supreme Court’s outcome. Although Warhol used pre-computer technology for his screen printing, the case has important implications for online copyright protections in a world of digital cut-and-paste and fingertip access to AI tools to transform digital works. You may have even seen apps that automatically transform photos into a Warhol-style work. A simple and broad holding from the Supreme Court supporting fair use would give substantial space allow these creative activities (and app development) to expand. But, that would be to the detriment of original creators seeking to protect their copyrights. A win for Goldsmith may require a re-tooling of these apps in order to fit within the stricter fair use requirements.

In his amicus brief, Berkeley Professor Peter Menell argues for Goldsmith, writing that “the Prince series consists of unauthorized derivative works prepared for a commercial purpose and without substantial transformative qualities.” Although Warhol’s work has become iconic within our culture, classifying the work as a “derivative work” creates the quirky conundrum that Warhol’s estate holds no copyright at all. This ruling then might extend to other areas—such as museum exhibits (since Goldsmith would then own the right to public display). I will note that Warhol already paid licensing fees to the owner of the underlying work in a number of situations, including for his use of Henri Dauman’s photo of Jacqueline Kennedy that had appeared in LIFE magazine.

This is not exactly a free speech case, but “meaning and message” certainly seem like forms of protected speech. In earlier cases, the Supreme Court ruled that fair use is a stand-in for First Amendment protections in the copyright world. We have seen copyright used in ways akin to SLAPP actions as well as by artists who do not want their work used to support unworthy causes (such as by politicians they oppose). The outcome here will shift those activities, either in favor of control by the original copyright holder, or more liberty to the potential (unwanted) user.

Atextual Conditions for Patentability and Stare Decisis

by Dennis Crouch

The new petition in SawStop v. USPTO (Supreme Court 2022) focuses the question of whether COURTS have power to create non-statutory patentability doctrines.

Does the judiciary have the authority to require a patent applicant to meet a condition for patentability not required by the Patent Act?

SawStop Petition for Certiorari.  You might imagine this argument being raised as tied to any number of patent doctrines: atextual eligibility limitations; assignor estoppel; doctrine of equivalents, etc.  This particular case focuses on obviousness-type double patenting (OTDP).  Question 2 of the petition focuses the question further: “Is the judicially created doctrine of nonstatutory double patenting ultra vires?”

Section 103 of the Patent Act generally defines the doctrine of obviousness and instructs tribunals to look to the prior art and consider whether the claimed invention is sufficiently beyond the prior art. But, even if a claims are found patentable under Section 103, the USPTO still considers obviousness-type double patenting.  Even if there is no prior art, the USPTO still bars a patentee from obtaining a separate patent claiming an obvious variation of already-issued claims held by the patentee/inventor. Thus, although 102(b)(2) explains that certain prior-filed patents are not prior art when attributed to the applicant/inventor, OTDP steps in on the back-side to effectively assert those excused documents as prior art.  Pause here to note that one big difference between obviousness and OTDP is that applicants can skirt OTDP rejections by filing a terminal disclaimer that effectively links the two similar patents together along two axes: same term and same owners.

My middle school shop teacher was missing fingers courtesy of a table saw. Yours? Steve Gass has a PhD in physics and also a patent attorney.  He was doing some amateurs woodworking when he conceived of his SawStop technology.  The basic idea: if the spinning blade ever touching human skin, the electrical connection triggers an emergency brake that stops/retracts the blade within 5 milliseconds.  “Fast enough to turn a life changing event into a minor cut.”  Gass has over 100 patents and runs the innovative product company SafeSaw.

Gass’s U.S. Pat No. 9,927,796 was filed back in 2002 — claiming priority to a 2001 provisional application. That patent finally issued in 2018–only after SawSafe filed a civil action and received a court-judgment in its favor.  A 1974 patent had disclosed use of a safety circuit and a braking-means. However, the district court concluded  that the prior art was not enabling — i.e., a person of skilled in the art would not be able to construct (or even design) the claimed invention without undue experimentation. [2016 Decision].

Another 16 issued patents also claim priority back to this 2002 application.  One application is still pending, Application 15/935,432, that claims an obvious variant of what has already been patenting.   The USPTO rejected the ‘432 application based upon the judicially created non-statutory doctrine of obviousness-type double patenting.  SawStop did not want to file a terminal disclaimer on this valuable patent and instead appealed.  On appeal, the Federal Circuit affirmed without opinion in a R.36 Judgment.  Now, SawStop has petitioned the Supreme Court asking that the doctrine be eliminated.

= = =

Although the petition does not cite the Supreme Court’s recent abortion decision, it certainly picks-up upon some of the same themes:

  • A right to abortion “is nowhere mentioned in the Constitution.”  Similarly, obviousness type double patenting has no grounding in the Patent Act.
  • The fact that a precedent is old does not convert that precedent to a sacred text.

The Supreme Court in Bilski addressed this issue to some degree in the context of the non-statutory categorical bars of abstract ideas; laws of nature and natural phenomenon.

While these exceptions are not required by the statutory text, they are consistent with the notion that a patentable process must be “new and useful.” And, in any case, these exceptions have defined the reach of the statute as a matter of statutory stare decisis going back 150 years.

Bilski v. Kappos, 561 U.S. 593 (2010).  The Bilski court found a small textual hook, but also identified the doctrine as built upon longstanding precedent.

The longstanding nature of precedent is important in the patent context.  But unlike in the Constitutional abortion context, we have always had direct statutes guiding patent issuance and enforcement, beginning with the First Congress in 1790. In the area of obviousness, the doctrine was developed by courts and then implemented by statute in 1952.  In Graham though, the Supreme Court indicated that, with minor exceptions, the 1952 Act maintained all the old precedent.

Double Patenting in the Statute.  In its 2014 Abbvie decision, the Federal Circuit wrote that Obviousness Type Double Patenting is “grounded in the text of the Patent Act.”   In particular, the court honed-in on Section 101’s use of the singular article “a” in describing what is granted to an inventor: “a patent.”

While often described as a court-created doctrine, obviousness-type double patenting is grounded in the text of the Patent Act. . . . Section 101 reads: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, … may obtain a patent therefor.” 35 U.S.C. § 101 (emphasis added). Thus, § 101 forbids an individual from obtaining more than one patent on the same invention, i.e., double patenting.

Abbvie Inc. v. Mathilda and Terence Kennedy Inst. of Rheumatology Tr., 764 F.3d 1366, 1372 (Fed. Cir. 2014).  But Judge Dyk’s conclusions in Abbvie are not well grounded themselves as there are several ways this provision could be interpreted. It also proves too much, since there are ways for a patentee to obtain multiple patents covering patentably indistinct inventions: (1) via terminal disclaimer; (2) via restriction.  If the patentee files a terminal disclaimer then the patent office will allow multiple patents to issue.  If the patentee files a divisional application (following a restriction) then the patent office will allow multiple patents to issue even without a terminal disclaimer.


Extraordinary Writ or Ordinary Remedy? Mandamus at the Federal Circuit – Part 3

By Jonas Anderson, Paul Gugliuzza, and Jason Rantanen

This is the final post in a series about our new research project on mandamus practice in the federal courts of appeals generally and the Federal Circuit’s peculiar use of mandamus in patent cases specifically.  The two previous posts can be found here and here.


Even if a plaintiff has filed its case in a federal court in which personal jurisdiction and venue exist, 28 U.S.C. § 1404(a) permits the judge to transfer the case to another district “[f]or the convenience of parties and witnesses, in the interest of justice.” Transfer motions under § 1404(a) are a common tactic in patent litigation, particularly for California-based tech companies sued in the Eastern and Western Districts of Texas. When defendants lose those motions—as they often do in Texas—they frequently seek immediate review in the Federal Circuit by petitioning for a writ of mandamus.

Despite the writ’s extraordinary nature, our study shows that it’s a remarkably ordinary form of relief in the Federal Circuit—at least in cases involving denials of transfer by the Eastern or Western District of Texas. The first time the Federal Circuit ever granted mandamus to overturn a transfer denial was in 2008, in a case called In re TS Tech, which arose from the Eastern District of Texas. Since that time, the Federal Circuit has decided 105 mandamus petitions seeking to overturn a denial of transfer under § 1404(a). It has granted 34 of them, for a grant rate of 32.4%. Pretty high for an extraordinary writ that’s supposed to issue only if the lower court’s decision was a “clear abuse of discretion” that “produced a patently erroneous result,” as the Federal Circuit wrote in a 2009 decision, In re Genentech. (Cleaned up.) The figure below shows the outcomes of decisions on mandamus petitions challenging § 1404(a) transfer denials decided by the Federal Circuit each year since 2008.

Figure 1: Mandamus decisions by the Federal Circuit involving challenges to 1404(a) decisions

Mandamus petitions arising from the Eastern and Western Districts of Texas account for the vast majority of petitions challenging transfer denial: 88 of the 105 in our dataset (83.8%). The grant rate for mandamus petitions challenging transfer denials by those two districts is 35.2%. And for the Western District of Texas alone, the grant rate is a whopping 52.0% (13 grants, 12 denials). For all districts besides the Eastern and Western Districts of Texas, the grant rate is a mere 17.6% (3 grants, 14 denials). The table below shows, by district court of origin, the number of mandamus petitions decided by the Federal Circuit seeking review of a decision denying transfer under § 1404(a), along with the corresponding Federal Circuit grant rates. As you can see, the sheer number of petitions (and grants) from the Eastern and Western Districts of Texas dwarfs all other districts.The recent explosion of patent cases in the Western District of Texas is fueled entirely by Judge Alan Albright who, as Jonas and I have written, has actively encouraged patentees to file infringement suits in his Waco courtroom and has adopted numerous procedural practices that are attractive to forum-shopping patentees—to say nothing of the fact that the Western District’s lack of random case assignment allows patentees to know, with absolute certainty, that Judge Albright will hear their case.

When we exclude the two Western District mandamus petitions that didn’t involve Judge Albright, the grant rate gets even higher. For mandamus petitions challenging transfer denials by Judge Albright, the Federal Circuit’s grant rate is 56.5% (13 grants, 10 denials). And that grant rate excludes one petition, In re DISH Network, which the Federal Circuit nominally denied but effectively granted by demanding that Judge Albright “reconsider” his transfer denial in light of the “appropriate legal standard and precedent,” which the Federal Circuit outlined in its opinion denying the writ.

*          *          *

The Federal Circuit is exceptional among the federal courts of appeals in using an extraordinary writ to engage in what is essentially interlocutory error correction. On first glance, we might view this as a flaw with the Federal Circuit: the specialized court is too zealously exercising its final authority over patent law and wasting party and judicial resources by policing discretionary district court rulings on an issue that’s entirely separate from the merits of the case. But Judge Albright’s aggressive efforts to attract patent cases to Waco—and his seeming disregard of appellate precedent on transfer of venue—have forced the Federal Circuit’s hand. Predictable judge assignments have encouraged what is essentially a race to the bottom among district judges who want to attract patent infringement plaintiffs. The mechanism for competition is procedural rules—and procedural rulings—that are extremely favorable to plaintiffs. And so the stakes over transfer of venue decisions are unusually high in patent cases. This suggests that the writ of mandamus—a procedural mechanism from the dustiest corner of civil procedure—will play a crucial role in determining the future of the U.S. patent system.

Abandoning Disparaging Marks

As TM owners willingly give up their racially disparaging and gender stereotyping marks, are there ways to ensure that the marks are not reoccupied by others wanting to free ride on their fame and infamy?

Guest Post by Deborah R. Gerhardt, Reef C. Ivey II Excellence Fund Term Professor of Law at UNC School of Law

Quaker Oats says it plans to phase out its “Aunt Jemima” brand. The character has long been criticized as a stereotypical representation of black women as inferior servants. In recognition of the problem, the Company had been gradually revising the brand’s image and considering when might be the appropriate time to phase it out altogether. Of course, if taking a bold stand against racism had been their true intent, they would have taken much more decisive action to drop the brand long ago.

As Trevor Noah observed on the Daily Show’s June 17, 2020 episode,

It’s also amazing that the brand knew that Aunt Jemima was racist and then instead of just changing it, they chose to instead slowly phase out the racism over time. That is so ridiculous. Can you imagine you caught your partner cheating and instead of stopping, they said, Yeah, yeah. You’re right baby. This is so wrong. I think I’m going to slowly start phasing out all of my affairs. From now on no sex, just hand stuff.

Amidst protests following the wake of George Floyd’s untimely death, Quaker Oats proclaims it truly does plan to take action to recreate the brand, although you would not know that from looking at its website one week after the announcement. As the screenshot below illustrates, no indication of abandonment appears on their pancake mix or syrup web pages.

The current plan is hardly inspiring. It appears to be: “Let’s keep the admittedly racist mark in place until a suitably less racist substitute has been crafted.”

One of the potential ways to challenge a third-party registration of a racist brand was eliminated in 2017. For years Section 2(d) of the Lanham Act blocked registrations that disparaged a group of people. But despite this bar, the “Aunt Jemima” mark (and so many other disparaging marks) registered anyway.  Some however, were blocked or cancelled (including the Washington Redskins mark) on that basis before the Supreme Court held the bar unconstitutional in Matal v. Tam 137 S. Ct. 1744 (2017). Since that decision, the First Amendment right to free expression permits citizens to seek registration of racially offensive trademarks.

After Tam, the Quaker Oats plan to abandon the Aunt Jemima mark raises an interesting question: what if a third party were to seize the opportunity to pick up the well-known mark and double down on the racist stereotype? Are there strategies that Quaker Oats can use to minimize any consequential harm? For a fun take on what such a highjacking looks like, go here https://southpark.cc.com/clips/vlg1j1/from-one-redskin-to-another to see what happens when the Southpark kids adopt “the Washington Redskins” for their start-up after the registration was cancelled. Contrary to the suggestion in that episode, there at least a couple of strategies that may work.

The Southpark spoof appears to be coming true with recent application to register marks on AUNT JEMINA and ESKIMO PIE by notorious “trademark entrepreneur” Leo Stoller. Consider Also Mark Cohen’s discussion of Colgate Palmolive’s Darlie (“Black man toothpaste.”) trademark in China.

The easiest option is to lean on the USPTO’s examiner corps. Even if the company ceases using the mark, the company’s portfolio of registrations will remain on the Principal Register until, one by one, they expire. If a new entrant to the syrup and pancake mix market applies to register “Aunt Jemima,” the Examiner would look at the Principal Register and see if any confusingly similar marks are still live. I predict that as long as Aunt Jemima lives on the Principle register, the marks will block others from registering confusing similar brands. We will not have to wait long to see if my prediction is right because on June 18, 2020, an individual in California applied to register “Aunt Jemima” for “Pancake mixes; Maple syrup; Pre-mixed pancake batter; Table syrup.” Something at the USPTO would have to go terribly against the norm for this application to succeed. Quaker Oats owns five registrations (and one pending application) for the brand, and some will not be up for renewal until 2025. Even if Quaker Oats took no action against the current applicant, the mark’s continued presence in the USPTO’s TESS data will give trademark examiners a clear and easy way to deny registration of the mark to anyone else until the last Quaker Oats “Aunt Jemima” mark expires.

This practice reveals that some trademark owners can succeed in blocking new entrants years after use has stopped. Although the Lanham Act ties trademark rights to use, for the sake of efficiency, USPTO trademark examiners treat third party federal registration as an irrefutable heuristic for use in office actions. When an Examiner blocks an application because the proposed mark is confusingly similar to one already registered, the USPTO treats the facts in the registration as true. Because Quaker Oats would not be a party to the applicant’s registration proceeding, USPTO examiners will not look into allegations of abandonment without Quaker Oats present to defend its brand. The company’s current “Aunt Jemima” registrations will be more than sufficient to deny the new entrant registration. However, if Quaker Oats opposed the registration, the new entrant could raise the defense of abandonment. Therefore, Quaker Oats would be smart to stay quiet and let the USPTO take care of the matter. If the new entrant had the chutzpah to seek cancellation of the Quaker Oats federal registrations, they would have to respond to the applicant’s claim that “Aunt Jemima” was available because Quaker Oats abandoned use of the mark and expressed a clear intent not to resume its use.

Beyond the arena of registration, there are alternatives for Quaker Oats to explore if someone were to actually start using the “Aunt Jemima” mark in commerce, whether or not the new entrant sought registration. The Lanham Act is broad enough to assert a claim against a new adopter even if the original trademark owner abandoned the mark as a matter of law as long as consumers still draw a connection between the “Aunt Jemima” mark and Quaker Oats. The language of 15 USC 1125(a) may support a cause of action for false sponsorship, false affiliation or false designation of origin or state unfair competition if a new entrant used the mark in commercial advertising in a way that causes Quaker Oats harm.  Contrary to what the Redskins (the football team not the start-up) owner claimed in the South Park skit, there actually is something a trademark owner can do, and much that the USPTO will do for a trademark owner both before and after the mark has been abandoned.

SCT: Procedural Rules Should Not Unwind the Power of IPR’s to Cancel Bad Patents

by Dennis Crouch

Thryv, Inc. v. Click-to-Call Tech (Supreme Court 2020)

In this case, the Supreme Court has sided with the PTO and Patent-Challengers — holding that the agency’s decision to hear an IPR challenge is not reviewable on appeal — even if the challenge is based upon the time-bar of §315(b).  According to the court, a ruling otherwise “unwind the agency’s merits decision” and “operate to save bad patent claims.”

Read the Decision Here: https://www.supremecourt.gov/opinions/19pdf/18-916_f2ah.pdf

The statutes authorizing inter partes review proceedings (IPRs) provides the USPTO Director with substantial latitude in determining whether or not to grant initiate an IPR. One limitation is that an IPR petition must be filed within 1-year of the petitioner (or privy) being served with a complaint fo infringing the patent. 35 U.S.C. §315(b).  The PTO cancelled Click-to-Call’s patent claims, but the Federal Circuit vacated that judgment after holding that the PTO should not have initated the IPR.  The issue on appeal was whether a lawsuit that had been dismissed without prejudice still counted under the §315(b) time-bar.  No, according to the PTO; Yes, according to the Federal Circuit.

A key problem with the Federal Circuit’s decision is the no-appeal provision also found in the statute:

The determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable.

35 U.S.C. §314(d).  The Federal Circuit held that the time-bar issue should be seen as an exception to the statute, the Supreme Court though has rejected that analysis.

Cuozzo: This is the Supreme Court’s second venture into analysis of the time-bar.  In Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131 (2016), the court held that the no-appeal provision will preclude appellate review in cases “where the grounds for attacking the decision to institute inter partes review consist 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.”   Cuozzo expressly did not decide when you might find exceptions — “we need not, and do not, decide the precise effect of § 314(d) on appeals that implicate constitutional questions, that depend on other less closely related statutes, or that present other questions of interpretation that reach, in terms of scope and impact, well beyond ‘this section.'”

In Thryv, the Supreme Court found that Cuozzo governs the time-bar question — holding that the statutory time-bar is closely related to the institution decision:

Section 315(b)’s time limitation is integral to, indeed a condition on, institution. After all, §315(b) sets forth a circumstance in which “[a]n inter partes review may not be instituted.” Even Click-to-Call and the Court of Appeals recognize that §315(b) governs institution.

Majority Op.  “The appeal bar, we … reiterate, is not limited to the agency’s application of §314(a).” Id. at n.6.

In its decision, the Supreme Court also puts its thumb on the policy concerns of “overpatenting” and efficiently “weed[ing] out bad patent claims.”

Allowing §315(b) appeals would tug against that objective, wasting the resources spent resolving patentability and leaving bad patents enforceable. A successful §315(b) appeal would terminate in vacatur of the agency’s decision; in lieu of enabling judicial review of patentability, vacatur would unwind the agency’s merits decision. And because a patent owner would need to appeal on §315(b) untimeliness grounds only if she could not prevail on patentability, §315(b) appeals would operate to save bad patent claims. This case illustrates the dynamic. The agency held Click-to-Call’s patent claims invalid, and Click-to-Call does not contest that holding. It resists only the agency’s institution decision, mindful that if the institution decision is reversed, then the agency’s work will be undone and the canceled patent claims resurrected.

Majority Op. Section III.C

Justice Ginsburg delivered the opinion joined in fully by Chief Justice Roberts and Justices Breyer, Kagan, and Kavanaugh.  Justices Thomas and Alito joined with the decision except for the policy statements found in III.C.

Justice Gorsuch wrote in dissent and was substantially joined by Justice Sotomayor.  Justice Gorsuch was not yet on the court when Cuozzo was decided, and Justice Sotomayor joined Justice Alito’s dissent to that decision.  The basics of the dissent is that our Constitution does not permit a “politically guided agency” to revoke property rights without judicial review:

Today the Court takes a flawed premise—that the Constitution permits a politically guided agency to revoke an inventor’s property right in an issued patent—and bends it further, allowing the agency’s decision to stand immune from judicial review. Worse, the Court closes the courthouse not in a case where the patent owner is merely unhappy with the merits of the agency’s decision but where the owner claims the agency’s proceedings were unlawful from the start. Most remarkably, the Court denies judicial review even though the government now concedes that the patent owner is right and this entire exercise in property taking-by-bureaucracy was forbidden by law.

Id.  The majority reject’s the dissent’s call for patents-as-property:

The dissent acknowledges that “Congress authorized inter partes review to encourage further scrutiny of already issued patents.” Yet the dissent, despite the Court’s decision upholding the constitutionality of such review in Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, 584 U. S. ___ (2018), appears ultimately to urge that Congress lacks authority to permit second looks. Patents are property, the dissent several times repeats, and Congress has no prerogative to allow “property-taking-by-bureaucracy.” But see Oil States, 584 U. S., at ___ (slip op., at 7) (“patents are public franchises”). The second look Congress put in place is assigned to the very same bureaucracy that granted the patent in the first place. Why should that bureaucracy be trusted to give an honest count on first view, but a jaundiced one on second look?

Majority Op. at n.4.

In a portion of the dissent not signed by Justice Sotomayor, Justice Gorsuch laments that the majority decision “takes us further down the road of handing over judicial powers involving the disposition of individual rights to executive agency officials.”

So what if patents were, for centuries, regarded as a form of personal property that, like any other, could be taken only by a judgment of a court of law. So what if our separation of powers and history frown on unfettered executive power over individuals, their liberty, and their property. What the government gives, the government may take away—with or without the involvement of the independent Judiciary. Today, a majority compounds that error by abandoning a good part of what little judicial review even the AIA left behind.

Justice Gorsuch in Dissent – Part V.

Just try to imagine this Court treating other individual liberties or forms of private property this way. Major portions of this country were settled by homesteaders who moved west on the promise of land patents from the federal government. Much like an inventor seeking a patent for his invention, settlers seeking these governmental grants had to satisfy a number of conditions. But once a patent issued, the granted lands became the recipient’s private property, a vested right that could be withdrawn only in a court of law. No one thinks we would allow a bureaucracy in Washington to “cancel” a citizen’s right to his farm, and do so despite the government’s admission that it acted in violation of the very statute that gave it this supposed authority. For most of this Nation’s history it was thought an invention patent holder “holds a property in his invention by as good a title as the farmer holds his farm and flock.” Hovey v. Henry, 12 F. Cas. 603, 604 (No. 6,742) (CC Mass. 1846) (Woodbury, J., for the court). Yet now inventors hold nothing for long without executive grace. An issued patent becomes nothing more than a transfer slip from one agency window to another.


Guest Post by Prof. Holbrook: Whose Law Controls On Sale Prior Art in Foreign Countries?

Guest post by Timothy R. Holbrook, Vice Provost for Faculty Affairs and Asa Griggs Candler Professor of Law, Emory University.

The America Invents Act (AIA) effected a sea change in U.S. patent law.  One of the most significant changes was to shift the U.S. from a “first to invent” to a “first inventor to file” system for allocating priority.  This move is reflected in the restructuring of 35 U.S.C. § 102, the provision that defines prior art for assessing whether an invention is novel and non-obvious.

Aside from the shift in assessing priority, some contended that, by amending § 102, Congress had rejected long-standing Supreme Court precedent that allowed secret uses and sales of the invention to trigger the statutory bars under the 1952 Patent Act.  In Helsinn Health Care S.A. v. Teva Pharmaceuticals USA, Inc., the Supreme Court, in its first case addressing the AIA’s § 102, rejected this argument.

The AIA did more than shift the United States to a first-inventor-to-file system, however.  The AIA also eliminated geographic limits on prior art.  Under the 1952 Patent Act, activities triggering the public use and on-sale bars under then-35 U.S.C. § 102(b) had to take place “in this country.” The elimination the geographic limit greatly expands what qualifies as prior art under the AIA.  Moreover, the Supreme Court’s interpretation of the AIA in Helsinn makes that even more sweeping as secret sales activity that may not be accessible to the broader public can now qualify as prior art.

The removal of the territorial limits, however, also presents a different question: whose law will govern whether an invention is deemed “on sale”?  Under the 1952 Patent Act, to be on sale, an invention (1) had to be the subject of a formal commercial offer for sale and (2) had to be ready for patenting.  Whether the invention is subject to a formal commercial offer is assessed from basic contract principles.

In the foreign context, however, what constitutes a formal commercial offer may vary from U.S. law. Because these proposed or completed sales transactions could take place outside of the United States, the law of another country generally would govern any potential or actual agreements.

The elimination of the geographic limits to on-sale activity now presents a choice of law problem.  On one hand, one could argue that the law of the relevant country should control: the parties in the transaction have that law in mind and not necessarily U.S. patent law.  On the other, if the courts were to rely on foreign law to assess whether the invention is “on sale” under § 102(a) of the AIA, then what qualifies as on-sale prior art would vary widely, depending on the law of the country in which the commercial activity took place.  The same activity might qualify as prior art in one context and not in another.  Courts, therefore, would be better of creating U.S. law defining triggers on-sale prior art regardless of where the activity occurred.

So what route will the courts take?  I suspect it will be the latter, using Federal Circuit law to define the contours of on-sale prior art even when the activity arises overseas.

The Federal Circuit addressed an analogous situation in interpreting the statutory bars under § 102(b) of the 1952 Patent Act.  After the Supreme Court reworked the on-sale bar test in Pfaff v. Wells Electronics, Inc., the Federal Circuit in Group One, Ltd. v. Hallmark CardsInc., clarified step one of the two-part test by requiring a formal commercial offer for sale.  In so doing, the court confronted a similar choice of law issue: should the law of the state governing the transaction dictate whether the invention was on sale, or should Federal Circuit law?

The court opted for the latter, rejecting the district court’s use of Missouri law to determine whether the invention was on sale.  The court reasoned that reliance on state law would create variability in interpreting a federal statute and emphasized “the importance of having a uniform national rule.” As the court stated:

To hold otherwise would potentially mean that a patent could be invalid in one state, when the patentee’s actions amounted to an offer under the laws of that state, and valid in a second state, when the same actions did not amount to an offer under the laws of that second state. Such a result is clearly incompatible with a uniform national patent system.

If past is prologue, one could easily see the court reaching the same conclusion with respect to the use of foreign law to interpret § 102(a) of the AIA.  Applying the law of various countries where commercial activities arise could lead to widely varying standards for on-sale prior art.  Indeed, the situation would be fare more complex than applying state law not only because of differing legal standards but also differing legal systems.  It is a more complicated analysis for U.S courts to discern foreign law than to discern the law of a given state.  It seems highly likely, therefore, that the Federal Circuit choose to apply its own law, using basic contract principles, in interpreting § 102(a) on-sale prior art that arises in foreign countries.

The situation at the international level, however, is far more complex than refusing to apply state law.  Activities in a foreign country would be assessed, and indirectly regulated, through the application of a U.S. legal standard, implicating concerns of the extraterritorial application of U.S. law.  Unlike the state law situation – where state law is subordinate to federal law – the Federal Circuit will be applying the law of the United States to acts in a co-equal sovereign. Actors in the relevant country may be unaware that their commercial behavior is violating U.S. patent law if there are significant substantive differences. That said, I would be surprised if courts consider this activity to trigger the presumption against extraterritoriality, in the same way they failed to truly account for the presumption in the patent exhaustion context.

The removal of geographic limits on public uses and on-sale prior art is a rather sweeping change.  As yet, the importance of the removal of these territorial limits has not been explored by the courts.  Particularly as it relates to on-sale prior art, courts likely will be applying U.S. law to activities arising in foreign countries in the interest in having a uniform standard.

Tim Holbrook is Vice Provost for Faculty Affairs and Asa Griggs Candler Professor of Law at Emory University.  This essay is drawn from part of his article, What Counts As Extraterritorial in Patent Law?, 25 B.U. J. SCI. & TECH. L. 291 (2019).

Copyrightability of Software: The Next Big Case

by Dennis Crouch

The next big software copyright case is before the Federal Circuit in the form of SAS Institute, Inc. v. World Programming Limited, Docket No. 21-1542.  The litigation has substantial parallels to Google v. Oracle, but might end up with a different outcome. In Google, the Supreme Court found fair-use but did not decide the issue of copyrightability. That issue is front-and-center in this case.

WPL is a UK based software company who obtained several copies of SAS statistical software and made a clone version. SAS sued in E.D.Tex for both copyright infringement and patent infringement.  The district court dismissed the copyright claims — holding that the software was unprotectable.

Plaintiff SAS showed that it holds a registered copyright, amply argued that its asserted works are creative, and presented repeated evidence of factual copying. … Defendant WPL then came forward with evidence showing that material within the copyrighted work was unprotectable. … SAS thereafter failed to show any remaining protectability, either by affirmatively showing some elements of the work to be protectable or by combatting Defendant’s showing of unprotectability.

Dismissal Memorandum.  SAS also stopped pursuing the patent allegations and they were dismissed with prejudice. Their inclusion in the case appears to have been enough to give the Federal Circuit jurisdiction rather than the Fifth Circuit, even though only copyright issues are on appeal.  I’ll note that a parallel copyright claim was rejected by the U.K. courts who determined that WPS had “reproduced only aspects of the program that are not protected by U.K. copyright law.”  Separately, SAS also previously litigated this copyright case in North Carolina federal court.  That court also granted summary judgment to the accused infringer on the copyright claim.  However, 4th Circuit vacated the copyright holding as moot and that claim was dismissed without prejudice.  Thus, as WPL writes in its brief: “This is the third time SAS Institute Inc. (“SASII”) has sued World Programming Limited (“WPL”) for copyright infringement. It is also the third time courts have rejected SASII’s copyright claims.”

SAS is hoping to change that outcome and has taken its appeal to the Federal Circuit with Dale Cendali (Kirkland & Ellis) leading the charge.  We shall see, but the Federal Circuit is likely one of the most pro-copyright courts in the country.  SAS’s primary arguments on appeal:

  1. Copyrightability: The SAS Material should be deemed copyrightable as a matter of law because (1) of the plethora of creative choices; and (2) even if individual elements in formatting and design are unprotectable, the overall selection and arrangement is protectable.
  2. Filtration Analysis Procedure: It is the defendant’s burden to show what aspects of a copyrighted work are not protectable; the district court flipped that around by requiring the plaintiff to show what is protectable.
  3. Filtration Analysis Procedure: The district court appears to have held a bench trial on this issue, but called it a “copyrightability hearing.” Normally this is an issue for a jury (although the copyright holder does not raise a 7th Amendment challenge).
  4. Filtration Analysis Procedure: The district court excluded SAS’s fact and expert witnesses in an improper manner.

WPL’s responsive brief was recently filed by Jeffrey Lamken (MoloLamken). The appellee restates the key copyrightability issue as follows: “Whether copyrights over a computer program protect (a) the functionality of executing programs written by users in a free-to-use computer language or (b) outputs dictated by user-written programs.”

A number of amicus briefs have already been filed in the case supporting the copyright holder.  The the deadline for briefs in support of WPL has not yet passed.

  • Brief of Ralph Oman (former Register of Copyrights): Computer programs are literary works entitled to full copyright protection. Once registered, the copyrights are entitled to a presumption of validity.
  • Author’s Guild (et al): Upsetting the burdens undermines copyright.  Although this is a software case, it has major spillover potential in other areas such as photography, writing, and music.
  • Copyright Alliance: Software is protectable by copyright.
  • Mathworks and Oracle: The court “flubbed its application of an otherwise sensible burden shifting approach.”

My favorite part of the appellee brief is that the redaction was done in MadLib format: 

Briefs filed so far:

Thompson v. Haight, 23 F.Cas. 1040 (S.D.N.Y. 1826)

The Thompson decision was released on January 1, 1826 and penned by Judge Van Ness who died later that year.  Van Ness was perhaps most famous for being Aaron Burr’s second at Burr’s duel with Alexander Hamilton, but this opinion shows further sign of his character.  Van Ness argues that the U.S. patent system at the time was being overrun by large numbers of trivial inventions. Although it required invention in name, it was really just becoming a replacement to monopolies barred by the Statute of Monopolies (1624). 

Van Ness further explains that the plethora of low quality patents harms the genuine inventors, because all patents are suspect.

It is unnecessary to look farther than to see the fate of Whitney, Evans, and above all, Fulton, or those who represent him. Instead of deriving peace, honour, and affluence from their incessant labour and incomparable skill, they have sunk under vexation and the pressure of litigation. Patent upon patent and privilege upon privilege have been granted, infringing the original rights, until their hopes and anticipated rewards were converted into despair and poverty. In the degrading conflict, even the laurels they had fairly won withered amidst the wreck of their fame and their fortunes.

Id. Van Ness called for a rigorous examination system and, once examined, patents should then be deemed secured:

They should only be granted, as I conceive, upon due examination into the merits of the application, and then the rights granted should be well secured, and well protected.

Id.  (more…)

Summary Judgment, Eligibility, and Appeals

by Dennis Crouch

Ericsson Inc. v. TCL Communication Tech. (Fed. Cir. 2020)

The jury sided with Ericsson — holding that TCL willfully infringed the two asserted claims of Ericsson’s US7149510 and awarded $75 million in compensatory damages. Judge Payne then added an additional $25 million enhanced damages for the adjudged willfulness.

On appeal, a divided Federal Circuit has reversed judgment — holding that the asserted claims are actually invalid as a matter of law as being directed toward ineligible subject matter under Section 101.  Majority Opinion by Chief Judge Prost and joined by Judge Chen. Dissenting Opinion by Judge Newman.

The bulk of the case focuses on waiver of TCL’s right to appeal – with the majority finding no waiver.

During the litigation, TCL moved for summary judgment of ineligibility.  The district court denied that motion after finding that the patent was not directed toward an abstract idea. The case continued then continued to trial and judgment as noted above.

After being denied summary judgment, a moving party typically needs to take a couple of steps in order to preserve the argument for appeal.  Preservation is necessary because the summary judgment motion is seen as effectively moot once trial starts, and so the party needs to make a post-trial renewed motion for Judgment as a Matter of Law (JMOL) under Fed. R. Civ. Pro. R.50(b) (or similar post-trial motion) in order to preserve the issue for appeal.  And, under the rules, a R. 50(a) JMOL motion (made during trial) is a prerequisite to the post-trial R.50(b) renewed JMOL motion. An appeal can then follow if the judge denies the R.50(b) motion.  Here, TCL did not file a JMOL motion or any other post-trial motion on eligibility, but instead simply appealed the Summary Judgment denial — typically a non-starter on appeal.

The waiver rule is different when Summary Judgment is granted.  A grant of summary judgment finishes litigation on the issues decided, and those issues are fully preserved for appeal.

Coming back to this case: Many denials of summary judgment are based upon the existence disputed issues of material fact.  And, even when a defendant’s SJ motion is denied, the defendant may still win the issue at trial.  Here, however, when the district court denied the ineligibility SJ motion there was nothing left for the jury to decide.  Using that logic, the majority held that when the court denied TCL’s ineligibility SJ motion, it effectively effectively granted SJ of eligibility.  Critical to this determination is the appellate panel’s finding that “no party has raised a genuine fact issue that requires resolution.”  With no facts to decide, the question became a pure issue of law: either it is eligibile or it is ineligible. “As a result, the district court effectively entered judgment of eligibility to Ericsson.”  And, as I wrote above, a grant of summary judgment is appealable.

Writing in dissent, Judge Newman argues that the majority’s conclusion that pre-trial denial of SJ on eligibility is the same as a final decision going the other way “is not the general rule, and it is not the rule of the Fifth Circuit, whose procedural law controls this trial and appeal. . . . The majority announces new law and disrupts precedent.”

Judge Newman explained that TCL simply failed to pursue its Section 101 claim after Summary Judgment was denied.

TCL did not pursue any Section 101 aspect at the trial or in any post-trial proceeding. . . . TCL took no action to preserve the Section 101 issue, and Section 101 was not raised for decision and not mentioned in the district court’s final judgment.

There is no trial record and no evidence on the question of whether the claimed invention is an abstract idea and devoid of inventive content. The panel majority departs from the Federal Rules and from precedent.

Newman, J. in Dissent.

The majority also went on to say that its “authority is total” in deciding whether to hear an appeal because there is “no general rule.” “We have the discretion to hear issues that have been waived.”  (The first quote is not actually from the court but something I read in the news).  The court here oddly includes the following statements:

[T]here is “no general rule” for when we exercise our discretion to reach waived issues. . . . Our general rule against reaching waived issues is
based on sound policy. . . .

Majority opinion (concluding that if appeal was waived, the court would exercise its discretion to hear the appeal).

= = = =

On the merits of the invention, the majority and dissent also disagree. As you can read below, the claims are directed to a system for software-access-control and the majority found it directed to the “abstract idea of controlling access to, or limiting permission to, resources.”  The district court instead found that the claims were directed to an “improved technological solution to mobile phone security software.”

1. A system for controlling access to a platform, the system comprising:

a platform having a software services component and an interface component, the interface component having at least one interface for providing access to the software services component for enabling application domain software to be installed, loaded, and run in the platform;

an access controller for controlling access to the software services component by a requesting application domain software via the at least one interface, the access controller comprising:

an interception module for receiving a request from the requesting application domain software to access the software services component;

and a decision entity for determining if the request should be granted wherein the decision entity is a security access manager, the security access manager holding access and permission policies; and

wherein the requesting application domain software is granted access to the software services component via the at least one interface if the request is granted.

5. The system according to claim 1, wherein:

the security access manager has a record of requesting application domain software;

and the security access manager determines if the request should be granted based on an identification stored in the record.


Competing Questions in Supreme Court Petitions

I enjoy reading competitive questions-presented in Supreme Court petitions.  Although I don’t have evidence to support this, my contention is that respondents have become much more aggressive at recharacterizing the questions from the way they were presented in the original petition.  As that aggression grows, so does the propensity of petitioners to write even more biased questions.

Briefing in Collabo Innovations, Inc. v. Sony Corp., Docket No. 19-601 (Supreme Court 2020), shows how the U.S. Solicitor’s office has gotten on-board the ‘game.’

Compare below:

Collabo Petition:

When U.S. Patent No. 5,952,714 issued in September 1999, the Patent Act provided only two avenues for challenging the validity of the patent’s claims: ex parte reexamination and district court litigation. Shortly thereafter, Congress added a third method, inter partes reexamination, but deliberately chose to exclude older patents from the new proceeding. More than 10 years later, Congress replaced inter partes reexamination with a fundamentally different proceeding, inter partes review, and made it apply retroactively to all prior patents.

Responsive Brief from U.S. Gov’t

For almost four decades, the United States Patent and Trademark Office (USPTO) has “possessed the authority to reexamine – and perhaps cancel – a patent claim that it had previously allowed.” Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131 (2016). In the Leahy-Smith America Invents Act (AIA), Congress replaced one of the existing mechanisms for administrative reconsideration of issued patents with a new administrative reconsideration proceeding known as inter partes review. Congress further provided that inter partes review “shall apply to any patent issued before, on, or after th[e] effective date” of the AIA.

The questions presented are as follows:

1. Does the retroactive application of inter partes review to a patent that issued before the passage of the AIA, violate the Takings Clause of the Fifth Amendment?

2. Does the retroactive application of inter partes review to a patent that issued before the passage of the AIA, violate the Due Process Clause of the Fifth Amendment?

The questions presented are as follows:

2. Whether the cancellation, following inter partes review, of petitioner’s pre-AIA patent violates the Just Compensation Clause.

1. Whether Congress’s decision to authorize the USPTO to conduct inter partes review of patents issued before the AIA’s effective date is irrational, and thus violates the Due Process Clause.

Notice the competing preambles that talk-past each other without addressing the same key points; The US Gov’t then reordered and rewrote the questions.  On the takings question — petitioner uses the trigger keyword “retroactive application” of IPR while the Gov’t refers to the more neutral “cancellation.”  Cancellation is an important term here because cancellation was already allowed pre-AIA under the reexamination statutes. On the due process question, the Gov’t flips the “rational basis” test to ask instead whether the AIA is “irrational.”  The Gov’t approach on this second question incorrectly suggests that Congressional irrationality is the test or perhaps the issue raised by the petition.  It turns out that neither are true because due process is also concerned with arbitrary government action (as indicated in Collabo’s briefing).

What is most interesting to me here is that these shifts and tilts of the question are all transparent to the Supreme Court justices and their law clerks. Still I expect that the alternate narratives trigger an emotional response; and those emotions are typically the root of decision making even for the highly rational.