All posts by Dennis Crouch

About Dennis Crouch

Law Professor at the University of Missouri School of Law.

Day One Project: USPTO Proposals for the Biden Administration

Day One Project is not part of the BIDEN Transition, but the organization has put together a strong group of pro-BIDEN IP experts and relative insiders who have drafted and published a Transition Document for the United States Patent and Trademark Office.

The following are a few of the key proposals: 

  • Increase international collaboration during patent examination, including simultaneous examination with IP5 offices.
  • Reorganize our IP engagement with China IP Engagement with a more coherent and effective approach.
  • Review of the non-patentability-factors used by the PTO to deny IPR institution (such as PTO money, and parallel litigation).
  • Expand IPRs to allow for consideration if indefiniteness and also double patenting.
  • Move forward with comprehensive patent eligibility reform.
  • Anonymous examination (examiners don’t know identity / race / gender / national origin of the patent applicant).
  • Fix PTAB Constitutionality (once Supreme Court decides Arthrex).
  • Studying diversity and working to incentivizing minorities (especially African-Americans) to invent and file for patent protection.
  • $$$:
    • Raising patent filing fees to address decline in maintenance fee payments (portfolio pruning) and also to “dampen frivolous filings.”
    • Further increasing maintenance fees to encourage release of patents to the public where the patentee is not making a sufficient return-on-investment.
  • Trademark: Make the process seriously user friendly.
  • Give USPTO Substantive Rulemaking Authority
  • Establish the USPTO Bureau of Economics
  • Small-Claims Patent Court
  • Expand Patents for Humanity Program

Read more here.

Federal Circuit Continues to Remain Silent about its R.36 Opinions

Waterblasting, LLC v. Iancu (Fed. Cir. 2021)

A few years ago, I wrote an article arguing that 35 U.S.C. § 144 requires the Federal Circuit to issue an opinion when it decides cases on appeal from the USPTO.

The … Federal Circuit shall review the decision from which an appeal is taken on the record before the Patent and Trademark Office. Upon its determination the court shall issue to the Director its mandate and opinion, which shall be entered of record in the Patent and Trademark Office and shall govern the further proceedings in the case.

35 U.S.C. § 144.  [My Article] The provision was amended in 1984 to particularly require a “mandate and opinion.” However, prior to that time the Federal Circuit and its predecessor always wrote opinions associated with every judgment. Although there is no legislative history, I believe that the fact of an opinion was assumed and simply codified into law.

In this case, Waterblasting, LLC appealed an adverse IPR decision cancelling claims 1-4 and 10 of its US7255116 (Stripe removal system).  On appeal, Waterblasting argued that the PTAB had erred in its legal analysis and also made factual conclusions that were not supported by substantial evidence.

The Federal Circuit sided with the PTO and affirmed. However, rather than explaining its decision, the Federal Circuit simply issued its judgment without opinion as permitted under Federal Circuit Local Rule 36.

In its newly filed en banc petition, Waterblasting argues that no-opinion judgments are improper in this situation:

§ 144 should be interpreted consistent with its clear language and the panel’s issuance of an affirmance without opinion is inconsistent with the law.

Waterblasting v Iancu Petition for en Banc Rehearing.

Note here that following my article, more than a dozen parties have asked the Federal Circuit to consider this issue. So far, the court gone meta — remaining silent about its choice to remain silent.

Boom! You Can’t Patent an Escrow Method

Boom! Payments, Inc. v. Stripe, Inc. (Fed. Cir. 2021)

I used to play golf fairly regularly and got into the habit of announcing “BOOM!” on every drive.  It didn’t help my game.  BOOM!’s great name here also didn’t save its patent from dancing the Alice Two Step. (Note: I was 15 years old at the time–on my high-school freshman team getting free-rounds for the season). 

This case is another affirmance of a dismissal for lack of patent eligibility. Under Alice/Mayo, the Supreme Court’s patent eligibility analysis is a two step process.  At Step 1, the court asks whether the claims at issue are “directed to” a patent-ineligible concept, such as an abstract idea. Claims that fail Step 1 can be saved by Step 2, looks for “something more” beyond the ineligible concept sufficient to transform the claim’s nature into a patent eligible invention.

The claims at issue here are somewhat similar to the exchange-settlement process found ineligible in Alice. In particular, Boom’s patents all claim “methods for confirming that a transaction has been consummated prior to releasing electronic payment.”  U.S. Patents 8,429,084; 9,235,857; and 10,346,840. The ‘840 patent issued June 2019 and so the PTO should have gotten this one right.  The examiner initially rejected claims 1 as ineligible (then listed as claim 21).  The patentee made several minor “clarifying amendments” and the examiner then allowed the case.  In its reasons for allowance, the examiner wrote the following:

The claims as amended have been analyzed under 35 U.S.C.101, and although directed at some level to an abstract idea, confirming that a proposed sale transaction has been consummated, the claims as currently amended are found to integrate the abstract idea into a practical application sufficiently that they are patent-eligible under §101.  They do not amount merely to having a computer apply an abstract idea, or using communication between computers to carry out a commercial interaction that could plausibly be done without computers or telecommunication (“could not plausibly be done” does not require that there be no conceivable parallel without computers or telecommunication).

93219_16212317_05-23-2019_NOA.  Claim 1 is pretty long, but it is directed to a computer system “for confirming that a proposed sale transaction has been consummated.”  The system is programmed to do the following:

  • Receive/store a buyer’s payment information;
  • Receive a request from the buyer to purchase an item from an online store;
  • Generate a “transaction-specific buyer acceptance identifier” using human-readable characters
  • Provide the TSBA identifier to the buyer’s computer who apparently provides it to the seller when purchasing.
  • Receive from a seller an identifier of the transaction (as well as the buyer and seller identities);
  • Compare the transaction and identity information;
  • If everything corresponds, then charge an account associated with the buyer.

This is basically a passcode system or checksum.

In its decision, the district court found the claims directed to the abstract idea of authenticating sales through the use of a third-party intermediary, and without any sufficient additional inventive concept.  On appeal, the Federal Circuit affirmed:

Boom argues that the claims are not directed to an abstract idea, but rather to a technological improvement over prior art systems for confirming and processing online payments. Specifically, Boom argues that the elements of the claims provide specific steps for processing an online payment, and therefore are not directed to the general concept of escrow. . . .

We agree with Stripe that the claims are directed to the abstract idea of payment escrow. They only describe steps of passing information back and forth by a computer. The very purpose of the patents, as explained in the written description, is verifying consummation of a transaction before releasing payment by a third party, which is the definition of escrow. . . . Indeed, the claims are reminiscent of those at issue in Alice.

Slip Op.

The patentee also disputed whether the case was properly dismissed at the pleading stage. Although eligibility is a question of law, some aspects of the determination may require a fact-finder to consider evidence (and thus creating a genuine issue of material fact that precludes dismissal on the pleadings). Here, the patentee particularly amended its complaint to allege that the claimed invention was not routine or conventional at the time of the invention. On appeal, the Federal Circuit disregarded those statements as conclusory because they were not supported by particularly “plausible factual allegations.”

Drilling-in on this, the complaint makes the following allegations:

The particularized manner in which the ‘transaction specific buyer acceptance identifier’ and ‘transaction consummation completion identifier’ of the claims of the Asserted Patents are generated, stored, used, and related to other identifiers was not well-understood, routine, or conventional at the time of Mr. Bogaard’s inventions.

The Federal Circuit identifies the assertion here as conclusory and thus gives it no weight in determining whether the complaint generates disputed material facts.  This is a bit odd since we’re asking the patentee to prove a negative, but perhaps the patentee could have cited to the reasons-for-allowance within the complaint itself or submitted an affidavit from an expert on-point as an attachment to the complaint.  At that point though we’re getting pretty far from the “short and plain statement of the claim” required by Fed. R. Civ. Pro. 8.

Conventionality is Irrelevant to Alice Step 1

by Dennis Crouch

iLife Technologies, Inc. v. Nintendo of America, Inc. (Fed. Cir. 2021) (Non-Precedential Decision)

The Trial: The jury sided with iLife–finding Nintendo liable for infringing iLife’s U.S. Patent No. 6,864,796 and awarding $10 million in damages. At trial, Nintendo had argued that the patent was invalid for lack of enablement and written description, but the jury denied those defenses. Nintendo also challenged the patent in an IPR, but the claims not proven invalid.

Here, the claims are directed a safety-feature for systems that evaluate body-movement, such as Nintendo’s Wii Sports and Mario Kart 8.  The basic idea is that the system will sense acceleration of a body and determine whether the associated movement is “is within environmental tolerance.”  A “tolerance indicia” is then created and transmitted.  The patent notes that movements beyond tolerance might “be damaging, destructive, crippling, harmful, injurious, or otherwise alarming or, possibly, distressing to the body.”

Eligibility: Pre-trial, Nintendo had also argued that the asserted claims were invalid as directed to the abstract idea of gathering and processing data.  The district court refused to decide that issue pre-trial.  However, after the trial, the court stepped-up and found the claims invalid.  That decision eliminated the damages award.  On appeal here, the Federal Circuit has affirmed.

[ILife’s] claim 1 of the ’796 patent is not focused on a specific means or method to improve motion sensor systems, nor is it directed to a specific physical configuration of sensors. It merely recites a motion sensor system that evaluates movement of a body using static and dynamic acceleration information.

Slip. Op.

The patent itself includes more specific hardware and logical elements.  Consider, for instance Figures 1 and 5 below.  However, the asserted claims here were directed to a much broader abstraction.

As the district court held, the elements of claim 1, considered individually and as an ordered combination, fail to recite an inventive concept. Aside from the abstract idea, the claim recites only generic computer components, including a sensor, a processor, and a communication device. The specification’s description of
these elements confirms they are generic.


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Separating Out the Steps: The one quirk of this decision comes from the following statement: “The conventionality of the claim elements is only considered at step two” of the Alice/Mayo analysis.  In finding the claims directed to an abstract idea, the district court had noted that claim 1 does not require “anything other than conventional sensors and processors performing conventional activities previously known to the industry.”  It was error to consider conventionality at that stage of the analysis.  Despite that error, the appellate panel still found the claim directed toward an abstract idea.  Note that this is a non-precedential decision and so this line from the case won’t help yours.

= = = =

1. A system within a communications device capable of evaluating movement of a body relative to an environment, said system comprising:

a sensor, associable with said body, that senses dynamic and static accelerative phenomena of said body, and

a processor, associated with said sensor, that processes said sensed dynamic and static accelerative phenomena as a function of at least one accelerative event characteristic to thereby determine whether said evaluated body movement is within environmental tolerance

wherein said processor generates tolerance indicia in response to said determination; and

wherein said communication device transmits said tolerance indicia.

= = = = =

Michael Wilson (Munck Wilson Mandala) represented the patentee at trial and on appeal; Stephen Smith (Cooley) for the successful defendant.

Free Speech Tuesday: Regulating Internet “Tyranny”

by Dennis Crouch

July 4, 1776, the “united States of America” met and declared independence from Britain and its King who had worked to establish “an absolute Tyranny” over the thirteen colonies.  Ever since, in the American mindset, tyranny demands revolution. “[W]henever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government.”

My Missouri Sen. Josh Hawley grabs hold of this rhetoric in his new book – Tyranny of Big Tech.  Although Hawley’s publishing contract has been publicly cancelled, I’m sure he’ll find a way to publish it — even if it means he receives less money.  Hawley is way-off the mark.  As a person-in-power, he should have taken care to avoid revolutionary rhetoric for what is really a regulatory issue.  He unfortunately raised tensions, raised them again, and then again.

BUT, the power of big tech is real. This week, Trump’s soap-box (twitter account) was been removed; Stripe stopped processing his donations; Parler was removed from major app stores (Google + Apple) and its web host denied (Amazon AWS) until the company complies with moderation policies. Parler says it won’t comply.  You could imagine the owners of the internet backbone (Tier-1 ISPs) and as direct-to-customer-providers blocking communications from these services as well.  This is the most public flexing of US internet might, but lower-key actions have been going on for years — especially toward traditional vices such as sex-workers, pornography, gambling, and marijuana sales.  You could imagine next-level ramping up of tensions with pro-Trump shipping companies refusing to deliver for these companies.  Ahh, but the legality of all of this may depend upon regulatory controls on speech and on common carriers.

Hawley has been calling these recent actions a violation of free speech rights.  That is obviously wrong when it comes to First Amendment protections. The First Amendment does not require private companies publish Donald Trump’s speech or provide internet service Parler.  That said, for years liberals have been calling for network neutrality regulations that would go a long way toward this end.

Free speech law does not begin-and-end with the U.S. Constitution.  Rather, our internet has been structured as a reaction to common law principles later adapted by Congress.  Those rules and regulations can change, and likely will change over the next four years.

For now though, I’m just looking for our democracy to survive the next 9 days. Good luck everyone!

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Next Steps in Eligibility.

Two competing patent eligibility petitions have been filed with the Supreme Court.  In American Axle, the patentee argues that the Federal Circuit has gone too-far in finding its claimed method of manufacturing a frequency-tuned vehicle drive-shaft to be directed to a natural law (namely Hooke’s law).  In Ariosa Diagnostics, the petition goes the other way and argues that the Federal Circuit has unduly narrowed its conception of a product-of-nature under Myriad.  It would be interesting for the Supreme Court to take these cases as a pair in order to reconcile the law and explain the extent that product-of-nature analysis fits within the Mayo framework.


Sequenom Back Again: This time Patent Eligible

Federal Circuit Narrows Application of Hooke’s Law, but Still Wields the Ineligibility Hammer

Hey Mechanical Engineers: Your Patents are Also Ineligible


Supreme Court will hear Assignor Estoppel Case

Minerva Surgical Inc. v. Hologic Inc. (Supreme Court 2021)

The Supreme Court has granted certiorari in this case involving the traditional doctrine of assignor estoppel.

Question Presented by Minerva: The question is whether a defendant in a patent infringement action who assigned the patent, or is in privity with an assignor of the patent, may have a defense of invalidity heard on the merits.

Question Presented by Hologic: The question presented is whether the longstanding common-law doctrine of assignor estoppel should be abrogated by this Court.

Petition for Writ of CertiorariOpposition to CertiorariReply Brief;
Amicus by IP Professors (Lemley) – Engine Advocacy.

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The appellate panel in the case upheld the doctrine of assignor estoppel, but also found that an assignor could collaterally attack via IPR since the PTO does not enforce the doctrine.  The panel – led by Judge Stoll — also called for reconsideration of the doctrine “as it applies both in district court and in the Patent Office.”

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There are several related doctrines here: Estoppel by Deed, Assignor Estoppel; Licensee Estoppel. Licensee estoppel in the patent context was ended by Lear v. Adkins, 395 U.S. 653 (1969).  Prior to the Federal Circuit, some courts expanded Lear to also eliminate Assignor Estoppel.  See., e.g., Coastal Dynamics Corp. v. Symbolic
Displays, Inc., 469 F.2d 79 (9th Cir. 1972) (per curiam).  However, the Federal Circuit did not agree and has applied assignor estoppel over the decades to bar validity challenges by inventors and prior owners who are later sued for infringement.  While licensee estoppel is contract focused, its property law parallel is estoppel by deed which bars a prior-owner from “denying the truth of the deed.” Estoppel by deed servers as the doctrinal foundation for assignor estoppel in patent law.  Assignor estoppel is seemingly strengthened because the patent applicant publicly assures the USPTO of the patent’s validity by claiming patent rights.

In the end though, I believe that assignor estoppel only creates a strong presumption.  I expect that no estoppel would apply in cases where the seller expressly reserves the right to later challenge the patent. Of course, most employee-inventors will not have the negotiation power or awareness to demand such a provision.

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Moot on Appeal: Patentee’s Infringement Disclaimer Remove’s Challenger’s Ability to Appeal IPR

ABS Global, Inc. v. Cytonome/ST, LLC (Fed. Cir. 2021).

In a split opinion, the Federal Circuit has dismissed ABS Global’s appeal of its failed IPR trial — finding the appeal moot. U.S. Patent No. 8,529,161.

The simple story here is that Cytonome sued ABS for infringement of the ‘161 patent but lost on summary judgment of non-infringement.  ABS Cytonome did not pursue an appeal, and expressly “disclaim[ed] such an appeal.”

Meanwhile ABS had filed an Inter Partes Review proceeding that resulted in most of the claims being cancelled.  The PTAB did side with the patentee on two of the claims — finding that they had not been proven obvious.  ABS wanted all of the claims invalidated and so appealed to the Federal Circuit.

Appellant must have Standing to Appeal: Although the Patent Act provides a right to appeal to all parties of an IPR, the Federal Circuit also requires standing — a “concrete” and “particularized” harm associated with the patent’s existence — an actual case or controversy.  This is akin to ordinary declaratory judgment jurisdiction, but a bit lighter because of participation in the PTAB trial and the express statutory right.  Mootness is also wrapped-up in the standing discussion.  A court has no jurisdiction over a moot controversy.

When ABS appealed its IPR (partial) loss, the patentee (Cytonome) responded with an argument that the case was moot because Cytonome lost its infringement lawsuit already and expressly abandoned any right to appeal.  Going forward, claim & issue preclusion would prohibit Cytonome can sue ABS for infringement of the ‘161 patent (at least for the same infringement that ABS was already doing).

ABS argued that the case is not truly moot because Cytonome might sue ABS for a modified version of its product.  The viability of those claims creates a cloud for the company.   On appeal, the Federal Circuit asked whether ABS had any plans — concrete plans — in connection with products that might infringe the patent.  ABS had none and so the court concluded that the case has become moot.

Cytonome’s disavowal therefore estops Cytonome from asserting liability against ABS for infringement of the ’161 patent claims in connection with the accused products, thereby allowing ABS to make, use, and sell those products freely. [Under the Kessler doctrine]. Cytonome’s disavowal would also bar a future suit for infringement of the ’161 patent claims covering ABS products that are “essentially the same” as ABS’s currently accused products. [Under Brain Life’s extension of Kessler]. . .

ABS acknowledged during oral argument that there was no evidence in the record that ABS engaged in or had concrete plans to engage in activities not covered by Cytonome’s disavowal. . . . Here, the evidence in the record fails to establish that ABS had a “particularized, concrete stake in the outcome” of its IPR appeal.

Dismissed as Moot.

The dissent by Chief Judge Prost does not dispute the mootness, but argues that the court should have taken the second step of vacatur:

Time and again the Supreme Court has explained that vacatur is in order when the prevailing party below unilaterally moots an appeal. The Majority today departs from that established practice, concluding that dismissal is the proper course here. It is not.

In particular, the dissent would have vacated (essentially marked-out) the challenged portion of the Board’s decision.  That would seemingly eliminate the potential estoppel effect of IPR determinations.

UPDATED: Must a Plaintiff Investigate a Patent’s Validity Prior to Suing for Infringement?

Updated below to correct an error in my original analysis. -DC

WPEM LLC v. SOTI Inc. (Fed. Cir. 2021)

WPEM sued SOTI for patent infringement based upon its mobile-device software management “Speed Lockdown” tool. The complaint cites MobiControl Version 11 as infringing.  In its answer, SOTI responded with information from its Version 10, which predates the asserted patent as well as other prior art references.  Settlement discussions ensued:

  • Offer 1: P offers to settle for $429k; D says “no, the patent is invalid.”
  • Offer 2: P offers to settle for $150k; D says “no, the patent is invalid” and also sent P a R.11 notification (alleging that the complaint was filed without sufficient investigation and thus in violation of R. 11).
  • Offer 3: P offers to settle for $75k; D says “no, the patent is invalid.”
  • Offer 4: P offers to dismiss the case with prejudice and grant a license if D agrees to dismiss its counterclaims and abandon its request for attorney fees; D says “no.”

P (WPEM) subsequently asked that its case be dismissed with prejudice.  The district court dismissed the case, but also found it exceptional under 35 U.S.C. 285 and awarded attorney fees of  $180k. The primary basis of the district court’s award was WPEM’s failure to conduct sufficient pre-filing investigation and also continuing the case after learning of its frivolous case.  The court wrote:

WPEM conducted no pre-filing investigation into the validity and enforceability of the Asserted Patent.

WPEM, LLC v. SOTI Inc., 2020 WL 555545 (E.D. Tex. Feb. 4, 2020).

UPDATE – I read through the district court case again and found that I had erred in my statement above (now with strikethrough).  Rather, the district court particularly concluded that it “finds nothing exceptional about WPEM’s post-filing conduct.”  The district court considered the progressive settlement offers, but did not find them improper in any way. Id.  

On appeal, the Federal Circuit affirmed — giving deference to the district court’s judgment on exceptional case awards and finding no abuse of discretion. WPEM, LLC v. SOTI Inc., 2020-1483, 2020 WL 7238458, at *1 (Fed. Cir. Dec. 9, 2020)

WPEM’s argument on appeal was that a patentee need not conduct any investigation regarding the validity of its patents prior to filing a lawsuit because a patent is presumed valid and enforceable.  Any invalidity defense is for the defendant.  On appeal, the Federal Circuit did not disagree, but appears to have twisted the district court opinion somewhat.

Contrary to WPEM’s assertion, we do not read the district court’s opinion as failing to account for the presumptions of validity and enforceability. Instead, the court based its award of attorneys’ fees, in part, on the frivolous nature of WPEM’s infringement position (i.e., the substantive strength of WPEM’s litigation position)—an issue that could have easily been foreseen with an adequate pre-suit investigation (i.e., the unreasonable manner in which the case was litigated). As the court reasoned, because the Accused Technology is prior art to the ’762 patent, “if WPEM prevailed on its assertion that the Accused Technology is covered by the Asserted Patent, it would have had the effect of invalidating, rather than infringing, the Asserted Patent.” Because it is undisputed that the Accused Technology is prior art to the ’762 patent, see id., WPEM could not bring a successful infringement suit.

Id. The appellate decision makes logical sense but for the recognition that infringement analysis is a separate and distinct doctrine from anticipation and that the complaint (apparently) does a reasonable job of showing how the accused product actually practices the invention.

The patentee has now petitioned for en banc rehearing with the following two questions:

  1. When a plaintiff is not aware of any reason to question the validity of an issued United States Patent, is that plaintiff allowed to rely on the statutory presumption of validity when filing a patent infringement lawsuit?
  2. While invalidating the claims of a validly issued United States Patent requires clear and convincing evidence, is a District Court allowed to base a finding of exceptionality under §285 for an inadequate pre-suit investigation of patent validity using the lesser standard that the patent is likely invalid when the plaintiff is not aware of any reason to question validity?

[WPEM Petition for Rehearing].

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Fees on Fees: The defendant had asked for $267k in attorney fees, but the district court only knocked-off about $87k of that — but awarding $180k. That $90k portion was the amount SOTI’s attorneys racked-up in drafting and arguing its motion for fees. The district court refused to award fees-on-fees in this case.

The Court understands that, in pursuing a § 285 recovery, parties will inevitably incur additional attorneys’ fees. However, in this case a near doubling of the amount already incurred in fees is simply unreasonable. At some point, a party must be mindful of the use and conservation of judicial and party resources and cannot (after it realizes it will prevail) continue to incur fees far in excess of any proportional relationship to the fees incurred in the merits portion of the case.

WPEM, LLC v. SOTI Inc., 2020 U.S.P.Q.2d 38024 (E.D. Tex. 2020).

= = = =

Bill Ramey is representing the patentee in the appeal; Robert Greeson for the defense.  SOTI has not yet responded to the petition.

Easing into 2021 with PTAB Affirmance

Comcast Cable Communications v. Promptu Systems Corporation (Fed. Cir. 2021)

The Federal Circuit’s first decision of 2021 comes as a boring 5-page non-precedential opinion upholding a PTAB Final Written Decision that Promptu’s claims had not been proven invalid.  Love it! 💓💓🌼🌼🌼. 

Promptu’s U.S. Patent No. 7,260,538 claims voice-recognition processing using a cable-TV remote-control but processed server-side (cable head-end unit).  The chart below shows the communications pathway from the Remote Control via the Set-Top Box then to the Cable Company’s Head-End Unit where the speech processing actually occurs.

The cited prior art was quite similar in that it allowed speech processing via the remote.  However, the key difference appears to be the content of the messages. In particular, the invention here focused on receiving “command functions” that control the set-top box while the prior art involved accessing information over the network and causing actions at the server.  That difference was sufficient to win the day for the patentee.

Comcast raises a panoply of arguments challenging the Board’s final-written decisions. Primarily, it claims the Board erred by rejecting its construction of “command function” as overly broad and by finding no motivation to combine Houser with the primary references. We do not agree.

Slip Op.

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In a separate opinion, the Federal Circuit vacated-in-part another Comcast vs Promptu case — this one involving Promptu’s U.S. Patent No. 7,047,196. [Decision]  The court found that the PTAB had too-narrowly construed the claim term “received back channel.”

Toothbrush walks into a bar

by Dennis Crouch

Maxill, Inc. v. Loops, LLC (Fed. Cir. 2020)f [Maxill v. Loops]

The Loops patent covers a flexible toothbrush — and the claims require “an elongated body being flexible throughout the elongated body.”  US8448285 (Claim 1). Apparently, these brushes are sold primarily to “institutional” settings such as prisons.

Early in the case, the patentee moved for summary judgment of infringement.  The district court denied the motion, and acted sua sponte to enter summary judgment of non-infringement.  Apparently, the judge had inspected the accused product and found that the head-portion of the elongated body wasn’t flexible. Although the body was made of flexible rubber, once the stiff head (with bristles) was molded-in, the body was no longer flexible.

On appeal, the Federal Circuit has reversed and remanded — finding that the district court erred in  its claim construction of “elongated body being flexible throughout the elongated body.”  The appellate court found that the flexibility requirement does not require the whole assembly to be flexible, but rather only that the elongated itself be flexible.

Loops argues that the accused toothbrush’s elongated body is made of orange flexible material that is flexible throughout (a position that Maxill does not dispute) and that this component is separate from the more-rigid head component. . . . We agree with Loops and conclude that, based on the claim language and structure, as well as the specification, the district court misunderstood the flexibility limitation to pertain to the elongated body when combined with the head as opposed to the elongated body alone. . . . Reversed.

Slip. Op. Read the claim and tell me what you think? Does the body need to be flexible when assembled, or only pre-assembly?

1. A toothbrush, comprising:

an elongated body being flexible throughout the elongated body and comprising a first material and having a head portion and a handle portion;

a head comprising a second material, wherein the head is disposed in and molded to the head portion of the elongated body; and

a plurality of bristles extending from the head forming a bristle brush, wherein the first material is less rigid than the second material.

Claim 1.

= = = =

The appellate panel also took issue with the sua-sponte summary judgment without first providing the party with a “full and fair opportunity to present its case.”  Here, although Loops had presented its summary-judgment argument of infringement, the appellate panel found that summary-judgment of non-infringement to be an entirely different matter. “Under the circumstances, we conclude, Loops did not have a full and fair opportunity to respond to Maxill prior to the district court’s sua sponte grant of summary judgment.”

= = = =

I was researching old inventors, but couldn’t find the burial place of William Addis, the toothbrush inventor. . . No plaque.

Federal Circuit: User Experience is not Computer Functionality

by Dennis Crouch

Simio, LLC v. FlexSim Software (Fed. Cir. 2020) (opinion by Chief Judge Prost and joined by Judges Clevenger and Stoll).

In this case, the Federal Circuit has affirmed the lower court’s summary dismissal of Simio’s infringement lawsuit on eligibility grounds.  The appellate panel also upheld the lower court’s refusal to permit the patentee to amend its complaint — seeing the proposed amendment as “futile.”

Dennis Pegden has received many awards for his work developing software (and programming languages) for simulating real-life processes in order to optimize decisionmaking; perform risk analysis, etc.  He was a professor who then developed his own company that was bought-out by Rockwell. Later, he formed the new company Simio, that owns the patent at issue here: U.S. Patent No. 8,156,468.  The ‘468 patent is effectively an object-oriented simulation programming tool that allows users to develop simulation models of process flows using a graphical framework.

In December 2018, Simio sued its competitor FlexSim for infringement of the ‘468 patent; FlexSim responded with its successful motion-to-dismiss on eligibility grounds.  The district court found the claims directed to the unpatentable abstract idea of the “decades old computer programming practice of substituting text-based coding with graphical processing.”

On appeal, the Federal Circuit affirmed — finding that the claims were indeed directed to transitioning from text-based coding to icon-based.  In making its “directed to” conclusion, the court repeatedly quoted the specification’s explanations that

[A]n object in the present invention is simple and completely graphical. There is no need to write programming code to create new objects. . . . Simio™ objects can be created with simple graphical process flows that require no programming. . . . [T]his invention can bring an improved object-oriented modeling approach to a much broader cross-section of users. . . . [etc.]

Quoting the patent specification.  And, the court agreed that “Simply applying the already-widespread practice of using graphics instead of programming to the environment of object-oriented simulations is no more than an abstract idea.”

Prior decisions have found innovations that improve computer functionality to be non-abstract (and thus patent eligible). Here, the court admitted that the claimed innovation may well improve the ability of many individuals to create simulations, but found that such a usability improvement does not count as an improvement to the computer’s functionality.

[Simio’s] argument does not explain how the computer’s functionality is improved beyond the inherent improvement of the experience of a user who cannot (or maybe, would rather not) use programming.

Slip Op. Quoting Customedia, the court explained its position that “user experience” is not “computer functionality.”

Simio pointed to particular improvements of user behavior offered by its invention such as faster simulation model development (a major selling point of the products in this area). Again, the court found that an abstract idea is still abstract, even if done quickly.

In Alice Step 2, the court admitted that the claim may include novel features, but those novel features are the abstract idea.

And that’s really what we have: a claim directed to the idea of using graphics instead of programming to create object oriented simulations—maybe a new idea, but still an abstract one—and lacking any inventive concept, any meaningful application of this idea, sufficient to save the claim’s eligibility.

Slip Op.

The rules of civil procedure allow for flexible pleading. Rule 8 simply requires “a short and plain statement of the claim.”  And, defects in a complaint are regularly fixed via amendment.  The rules of Civil Procedure require courts to “freely give leave” to amend pleadings “when justice so requires.”

Here, the district court refused to allow the patentee to amend its pleadings with specific allegations regarding the uniqueness of various claim elements.  On appeal, the Federal Circuit affirmed — finding that the proposed amendment were “conclusory statements” to be disregarding when ruling on a Rule 12(b)(6) motion.

Simio had delayed in its request to amend until after the deadline set by the district court in the R. 16(b) scheduling order.  On appeal, the Federal Circuit found that the district court was within its rights to deny amendments after that deadline absent presentation of good cause. Here, the court’s granting of the motion-to-dismiss didn’t count as good cause.

Free Speech Tuesday: Tinker on Snapchat

Mahoney Area School District v. B.L. (Supreme Court 2020)

This case is about whether the First Amendment protects high-school students and their Snaps against punishment and regulation by public school officials.

Question Presented by the School: Whether Tinker v. Des Moines Independent Community School District, 393 U.S. 503 (1969), which holds that public school officials may regulate speech that would materially and substantially disrupt the work and discipline of the school, applies to student speech that occurs off campus.

Competing Question by the kid: Whether the court of appeals correctly held that a public high school violated the First Amendment when it punished a student for her colorful expression of frustration, made in an ephemeral Snapchat on her personal social media, on a weekend, off campus, containing no threat or harassment or mention of her school, and that did not cause or threaten any disruption of her school.

B.L. apparently was a varsity cheerleader during her freshman year, but was relegated to J.V. during her sophomore year.  After receiving that news, B.L. posted a photo of herself and several friends raising their middle fingers and including the following quote: “Fuck school fuck softball fuck cheer fuck everything.”  Although the post was only temporarily on Snapchat, at least one student took a screenshot and provided it to a school official.  In addition, at least one person accessed the vulgarity from a school computer.

B.L. was then kicked-off the team. According to the school, a good cheerleader must have “have respect for the school, coaches, teachers, [and] other cheerleaders” and must also avoid “foul language and inappropriate gestures.”  ACLU sued on B.L.’s behalf and won, including a 3rd Circuit decision limiting School’s control over student off-campus speech.




Consolidated Appropriations Act of 2021

The huge appropriations bill includes a few IP gems: [LINK]

  • Appropriation: $3.6 billion to USPTO. All money must com from PTO fees. The Copyright Office is appropriated $93 million; ICE has $15 million for IP border enforcement; The Federal Circuit receives $33 million. (I believe this is in addition to the judicial salaries of $229k for 2020).
  • Illicit digital transmission: Big new copyright protections against streamers with felony penalties.
  • CASE Act of 2020: Small-claims copyright court.
  • Trademark Modernization Act of 2020: This change includes new mechanisms for opposing/canceling trademark registrations, including third-party submission of evidence. Allow for “expungment” of a registration application that has not been used in commerce, and 3rd party petition to cancel on non-use grounds.   PTO Director is given extra authority to unilaterally reconsider, modify, or set aside TTAB decisions. (This is a likely solution if Supreme Court finds PTAB unconstitutionally appointed).
  • Trademark Modernization Act of 2020: Presumption of injunctive relief — overcoming eBay:

‘‘A plaintiff seeking any such injunction shall be entitled to a rebuttable presumption of irreparable harm upon a finding of a violation identified in this subsection in the case of a motion for a permanent injunction or upon a finding of likelihood of success on the merits for a violation identified in this subsection in the case of a motion for a preliminary injunction or temporary restraining order.’’

  • Biologic Patent Transparency: requires the holder of a license to market a biologic drug to disclose all patents believed to be covering that drug.



Request for Comments on the National Strategy for Expanding American Innovation

The USPTO is in the midst of writing a new “report concerning patenting and entrepreneurship activities among women, minorities, and veterans” and is seeking comments (www.regulations.govdocket number PTO-P-2020-0057).

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Issues for Comment: The USPTO seeks comments from the public that will be used to help draft a national strategy to create opportunities that will expand our innovation ecosystem to include all individuals, including those from underrepresented socioeconomic, geographic, and demographic groups. The questions below are grouped according to the categories within the broad conceptual framework outlined above for the national strategy. The USPTO welcomes answers to these questions, as well as any additional comments, from the public:

I. General

1. Inventors and entrepreneurs come from all walks of life and are not always employed by a large corporate or educational institution. How can people and organizations in the innovation ecosystem better support them?

2. Women and some minorities have not participated proportionally in the patenting of inventions. What barriers to innovation inclusion are specific to underrepresented groups? What supporting role should government organizations play in helping underrepresented groups overcome these barriers?

3. Mentoring and networking have been shown to be effective tools in supporting and encouraging underrepresented inventors and entrepreneurs. How can organizations and intellectual property practitioners in the innovation ecosystem better connect underrepresented innovators to each other and to mentors, both internally and across organizations?

4. Developing organizational metrics to document the effectiveness of diversity and inclusion initiatives is necessary to track outcomes of action plans and initiatives. What are best practices that organizations can internally employ to measure their own progress, particularly in the area of intellectual property protection?

5. Measuring national progress in realizing greater inclusion and diversity in invention, entrepreneurship, and intellectual property may take years, and it will be critical to identify complementary short- and long-term metrics that are precursors to and indicators of expanding innovation. What are some specific, meaningful, and relevant measures that can be used to:

a. Support year-over-year performance of action plans and initiatives in the short-term?

b. Demonstrate the long-term creation of diversity and inclusion in the innovation ecosystem while complementing short-term performance metrics?

6. Invention, entrepreneurship, and intellectual property protection have been shown to be concentrated in certain areas of the country and among individuals from higher socioeconomic groups. What new or existing channels could be created or utilized to more effectively deliver information and resources to prospective innovators from all demographic, geographic, and economic backgrounds?

II. Creating Innovators—Helping To Prepare People To Obtain the Skills and Develop the Interests Necessary To Become Innovators, Problem Solvers, and Entrepreneurs

7. Research has shown that “invention education”—the infusion of transdisciplinary education in problem identification and problem solving—is critical to developing innovation skills in learners. How can educational institutions at all levels (pre-kindergarten through post-graduate) successfully infuse concepts of invention, entrepreneurship, and intellectual property education into curricula?

8. To supplement formal education, how can community institutions, particularly in rural and economically disadvantaged areas, build awareness of, and skills and interests in, invention, entrepreneurship, and intellectual property among students of all ages?

9. More can be done to help teachers, even those with a formal science, technology, engineering, or mathematics (STEM) background, incorporate concepts of innovation into their teaching methods. What new or existing professional development opportunities, resources, and programs could train teachers to incorporate invention education concepts into their instruction? How could these efforts be leveraged and scaled so that similar resources and opportunities are accessible to all teachers?

III. Practicing Innovation—Harnessing Skills and Interests to the Act of Innovation

10. Recent progress in developing STEM graduates from underrepresented groups has been documented. How can similar rates of invention and entrepreneurship be attained? How can organizations best recruit and retain innovators from diverse backgrounds?

11. Inventors thrive when cultural and institutional barriers within workplaces are minimized or removed. What are examples of these barriers, and how can organizations remove them to create an inclusive, innovative workplace culture?

12. Access to information and resources is pivotal for the development of individual inventors and small businesses. How can the nation better support individual inventors and small businesses with resources so they can successfully translate their skills and creativity into the acts of invention, intellectual property protection, and entrepreneurship?

13. Another important objective is increasing diversity in the entire Start Printed Page 83908intellectual property field. What are ways of promoting diversity in the corps of intellectual property attorneys and agents who represent innovators?

IV. Realizing Innovation—Reaping the Personal and Societal Benefits of Innovation

14. Financial support is a critical element in translating an innovation into commercial success. What organizations, programs, or other efforts help promote access to capital to an expanded group of inventors and entrepreneurs—demographically, geographically, and economically?

15. Successfully commercializing an inventive product or concept requires in-depth knowledge about production processes, market forces, and other pertinent information. What types of mentoring initiatives could be implemented or expanded to help experienced entrepreneurs impart this specialized knowledge to diverse and novice inventors?

16. Formalized partnerships like tech transfer offices/conferences, accelerators, and incubators can help streamline commercialization objectives such as product development, licensing, and distribution. What can be done to make these partnerships more accessible and effective at supporting all inventors and entrepreneurs?

V. Other

17. Please provide any other comments that you feel should be considered as part of, and that are directly related to, the development of a national strategy to expand the innovation ecosystem demographically, geographically, and economically.

Andrei Iancu

Government Contracts and Ownership of Technical Data

by Dennis Crouch

The Boeing Company v. Air Force (Fed. Cir. 2020)

This is a government contract case involving rights to technical data provided to the government from a contractor.  Boeing is working on a multi-billion-dollar F-15 Eagle Passive/Active Warning Survivability System (EPAWSS) project subject to a DoD contract.  Under the contract, Boeing “retains ownership” of the technical data it generates and delivers.  However, the U.S. Gov’t receives also “unlimited rights” to the data, including the right to “use, modify, reproduce, perform, display, release, or disclose [the] technical data in whole or in part, in any manner, and for any purpose whatsoever, and to have or authorize others to do so.”

When Boeing began providing data, it included first notice below.  The U.S. Gov’t. objected to that language and Boeing offered the second alternative. Still though the U.S. Gov’t. objected as out of compliance with the DoD regulations. (DFARS 252.227-7013(f)).  This objection apparently came as something of a surprise — Boeing says that it has been marking its technical data with propriety legends since 2002.

Boeing wanted to retain its limitations on use and further disclosure by “Non-U.S. Government recipients” and so petitioned to the Armed Services Board of Contract Appeals (ASBCA).  After losing, Boeing brought its appeal to the Federal Circuit.  On appeal here, though the Federal Circuit has reversed.

This is a contract dispute that focuses on the DoD regulations because they were incorporated into the contract.  The regulations strictly limit they ways that a Contractor can “assert restrictions on the [US] Government’s right[s].”  Here, the Federal Circuit drew a fine-point — finding that Boeing’s restrictions are expressly designed to restrict only non-US-Governmental parties. Although the regulations state that “All other markings are nonconforming markings,” the court held that that statement as only applying to markings that restrict US governmental rights.

Thus, we agree with Boeing that Subsection 7013(f) … is silent on any legends that a contractor may mark on its data when it seeks to restrict only the rights of non-government third parties.

Slip Op.

Anyone savvy will note that if the US government has “unlimited rights,” then those rights would include the full right to release, disclose, our otherwise authorize a third-party to use the data. Boeing’s modified proposal takes this into account — stating that third-parties use must be authorized either by Boeing or the U.S. Gov’t.  However, the Gov’t still argues that its rights are being restricted because it requires the Government to be the “authorizer” — something potentially quite burdensome and “inconsistent with its unlimited rights.”  On remand, the Board may consider this issue.

In its decision, the Federal Circuit walks through a set of light policy arguments as well:

Boeing asserts that the Board’s interpretation of Subsection 7013(f) will have far-reaching consequences that will impair contractors’ abilities to protect their rights in their technical data and threaten the willingness of technology innovators to do business with the government. The government responds that allowing contractors unbridled freedom to mark technical data with self-created legends of their choosing is inconsistent with the DFARS and would encumber unrestricted information with unclear markings that make it difficult for the government to exercise its license rights.

To be clear, neither party presents any policy arguments that would be sufficient to overcome the plain language of Subsection 7013(f), as explained above. In any event, we decide this case on the regulation, not policy. … But our interpretation of the plain language of Subsection 7013(f) has the added benefit of alleviating some of Boeing’s policy concerns.


Technical Data Rights: The underlying question, of course, is what rights are we talking about? The US does not have a category of property rights known as “technical data rights.”  The best data protection may be trade-secret rights, but that does not seem to work here because we’re talking about data that has been turned over to another party without any restriction.  Boeing’s copyright notice is probably the best-clue.  However, copyright protection in a document is a far-cry being the “owner” of the technical data as the court discussed.

Pre-AIA 102: Meaning of On Sale “in This Country”

by Dennis Crouch

Caterpillar v. ITC & Wirtgen (Fed. Cir. 2020)

Caterpillar filed a complaint with the International Trade Commission (ITC) against Wirtgen — arguing that the German manufacturer was importing infringing devices into the US.  However, the ITC found the claims invalidated by the company’s pre-filing sales.  On appeal here, the Federal Circuit has affirmed.

Caterpillar’s U.S. Patent No. 7,140,693 covers a milling machine with retractable wheels (or tracks).   The invention here was originally created by engineers at the Italian company Bitelli in the late 1990’s.  Caterpillar purchased Bitelli in 2000, the priority patent application was not filed (in Italy) until April 2001, followed by the PCT in 2002.  Bitelli had already been selling embodiments of the invention even before 2000.

Pre-AIA patent law included some geographic limits on prior art.  The on-sale bar in particularly only applied to sales in the United States.

A person shall be entitled to a patent unless — (b) the invention was … sale in this country, more than one year prior to the date of the application for patent in the United States.

35 U.S.C. 102(b) (pre-AIA). Since this is a pre-AIA patent, the pre-AIA laws apply.

During litigation, patent claims are presumed valid unless proven invalid with clear and convincing evidence.  Here, Wirtgen presented records showing the sale of two Bitelli SF 102 C machines were sold to a U.S. Customer. One in June 1999 and the other in July 2000.  The machines were apparently delivered to the Bitelli factory gates in Italy, and the customer may have brought them to America.  The July-2000 machine (or at least a machine bearing that serial number) is actually located in the U.S., but there are no historic records of its location prior to 2018.

In finding the patent claims invalid, the ITC concluded the deliveries in Italy were still “directed to the United States” in a manner sufficient to satisfy the “in this country” prong of the on sale bar “by at least July 2000.”

On appeal, the Federal Circuit has affirmed.

Sale to US Company Not Enough: Wirtgen argued that “Under black-letter law, a sale to a U.S. company is an invalidating sale under § 102(b).” On appeal, the Federal Circuit rejected that contention — “our cases do not hold that the mere fact that the sale was made to a United States company is sufficient” to be “in this country.”

Sale Directed to the US is Enough: A foreign sale can be consider a US sale if it constituted “commercial activity directed to the United States.”  Here, the court found substantial evidence to support that conclusion for the 1999 invoice:

  • Buyer located in US;
  • Invoice suggests that US Tariffs were due (although the same tariff number is used in EU and other countries around the world);
  • Sale in US dollars;
  • Description of the machine in US;
  • the VAT assessment was at 0% rate — the rate used for export out of Italy and the EU. (20% for items staying in Italy); and
  • No other evidence indicating that the purchase was for use anywhere but the US.

Based upon all of this, the Federal Circuit affirmed that sales were in the US for the purposes of the on-sale bar.  Note here that the court’s conception of “directed to” analysis here is similar to the Supreme Court’s test for personal jurisdiction.  A key difference though is that the on sale bar is a statutory provision and the geographic limitation has been eliminated for post-AIA (2011) patents.

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In this case, the the Italian patent application was filed in April 2001, followed by a PCT in 2002 and then the U.S. national stage in 2003. The ITC decision concluded that July 2000 was “more than a year before the application for the ‘693 was filed.”

These facts, considered collectively, are clear and convincing evidence that the Bitelli SF 102 C was “on sale in this country” by at least July 2000, more than a year before the application for the ‘693 patent was filed, thus qualifying as prior art under section 102(b).

Calendarios will note that July 2000 is less than one year before the Italian priority date of 2001.  The problem is that the pre-AIA US statute granting priority for foreign national filings expressly excluded on-sale and public-use activity from the priority claim:

[A foreign-filed application] shall have the same effect as the same application would have if filed in this country on the date on which the application for patent for the same invention was first filed in such foreign country, if … filed within twelve months …; but no patent shall be granted on any application for patent for an invention which had been patented or described in a printed publication in any country more than one year before the date of the actual filing of the application in this country, or which had been in public use or on sale in this country more than one year prior to such filing.

35 U.S.C. 119(a) (Pre-AIA). Thus, for the on-sale and public use bar, the Italian national filing does not count as priority.  A separate provision on the code allowed the PCT date to still count. Thus, for Caterpillar, the critical date is April 2001 — 1 year before the PCT filing date.

Important additional note, these quirks were eliminated in the AIA.  Public uses and on-sale activity in Italy now count as prior art.  And, the Italian priority filing counts for all purposes.

[Note – I updated this statute after re-reading pre-AIA Section 119.]

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Odd side-note.  Figure 1 of the patent document includes two versions – one with wheels 1 and one with tracks 1a.  The priority documents only included the drawing with wheels (as shown above).  During prosecution, the examiner objected to claims directed toward tracks rather than wheels (Cat’s preferred emobidment as shown in the photo below), and the patentee added the new drawing 1a in the midst of prosecution with the statement that “no new matter has been added by these amendments.”  The examiner accepted the amendment without further comment. I’m rusty on Italian reading, but I believe that the Italian priority document does mention tracks, but only as follows:

As alternatives to wheels on the machine, track units can be applied and henceforth the word “wheel” may be replaced with the word “track unit.”

[Priority Document].