All posts by Dennis Crouch

About Dennis Crouch

Law Professor at the University of Missouri School of Law.

Patent Patent Patent

For these numbers, I aggregated all opinions filed with each decision.  The leading decision appears to be Aqua Products, Inc. v. Matal, 872 F.3d 1290 (Fed. Cir. 2017) with several hundred “patent” repeats across the four opinions in that en banc decision.

Patent Law at the Supreme Court October 2021

The Supreme Court has not granted a writ of certiorari in any patent cases this term, and has now denied certiorari in two dozen.  Still, there are a number of important cases pending that could be transformative if granted.

Two leading petitions before the court are:

  • American Axle & Manufacturing, Inc. v. Neapco Holdings LLC, No. 20-891 (eligibility); and
  • PersonalWeb Technologies, LLC v. Patreon, Inc., No. 20-1394 (issue and claim preclusion).

In both of these cases, the Supreme Court has requested that the Solicitor General offer the views of the U.S. Gov’t on whether the court should grant certiorari.  Although I am not privy to the exact timeline, I believe that there is a good chance that the SG’s brief in American Axle will be submitted by the end of December 2021.  The PersonalWeb brief is unlikely to be submitted until later in the spring.  American Axle clearly has the largest potential impact if the Supreme Court were to either (1) change course on eligibility; or (2) double-down on an expansive doctrine.

Two petitions will be considered by the court in upcoming days:

  • ENCO Systems, Inc. v. DaVincia, LLC, No. 21-457 (eligibility); and
  • Ultratec, Inc. v. CaptionCall, LLC, No. 20-1700 (R.36 and retroactive IPR).

I believe that American Axle is a better vehicle for Section 101 issues rather than ENCO, and I expect that the Supreme Court not will give much consideration to the ENCO petition.  It will likely denied even before any action taken on American Axle. Ultratec is interesting to me personally because it relates to some of my prior academic work, and the Supreme Court called for responsive briefing in the case. That said, the Gov’t brief in opposition is extremely dismissive of Ultratec’s arguments.  This suggests that the Supreme Court will not hear the case.

The Supreme Court has requested responsive briefing in three additional cases:

  • Warsaw Orthopedic, Inc. v. Sasso, No. 21-540 (on petition from the Indiana Supreme Court; arising under jurisdiction)
  • Infinity Computer Products, Inc. v. Oki Data Americas, Inc., No. 21-413 (indefiniteness); and
  • Olaf Sööt Design, LLC v. Daktronics, Inc., No. 21-438 (using claim construction to overturn a jury verdict).

Responsive briefs are expected in the next couple of weeks for these cases.  Although a request for responsive briefing is indicative of some interest in the case, the threshold is quite low and so it is much too early to suggest that these cases are likely to be granted certiorari.  Infinity could be quite big if the Supreme Court took the case and again recalibrated the doctrine of indefiniteness.  In Nautilus, the Supreme Court found that the lower court was too easy on patentees; Infinity argues that the court is now being too hard on patentees.

The remaining four patent petitions are listed roughly in order of their likelihood of being granted certiorari (in my opinion). I expect that the Mylan and Apple petitions would be granted as a pair, if granted at all.

  1. Mylan Laboratories Ltd. v. Janssen Pharmaceutica, N.V., No. 21-202 (NHK-Fintiv rule for denying petitions; appealability of IPR petition denial);
  2. Apple Inc. v. Optis Cellular Technology, LLC, No. 21-118 (mandamus review of IPR petition denial);
  3. Infineum USA L.P. v. Chevron Oronite Company LLC, No. 21-350 (mid-Arthrex issue, potential for GVR with instructions for PTO Director to place his imprint on the decision); and
  4. Bongiorno v. Hirshfeld, No. 21-6050 (pro se; eligibility).

There is one final case that has some filings at the Supreme Court:

  • Apple Inc., v. Qualcomm Inc., No 21A39 (Standing of portfolio licensee to challenge individual patents in court).

Apple has not yet filed its petition but did indicate its plan to do so in a request for extension of time.  Its initial petition is now due November 17, 2021.

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A few non-patent IP cases pending before the Supreme Court of some interest:

  • Unicolors, Inc. v. H&M Hennes & Mauritz, L.P., No. 20-915 (referral of copyright litigation issues to copyright office) (this is the only one granted certiorari, oral arguments set for November 8, 2021);
  • Ezaki Glico Kabushiki Kaisha v. Lotte International America Corp., 19-3010 (functional trade dress)
  • Sulzer Mixpac AG v. A&N Trading Co. (functional trade dress);
  • Impax Laboratories, Inc. v. Federal Trade Commission, No. 21-406 (reverse payment patent settlement).
  • Belmora LLC, et al. v. Bayer Consumer Care AG, No. 21-195 (impact of foreign use on trademark rights in the US);
  • Australian Leather Pty. Ltd., et al. v. Deckers Outdoor Corporation, No. 21-513 (impact of foreign use on trademark rights in the US);

Next UPSTO Director: Kathi Vidal

by Dennis Crouch

President Biden has nominated leading patent litigator Kathi Vidal as the next USPTO director.  Vidal is currently at Winston & Strawn, leading the company’s Silicon Valley office. She was previously with Fish & Richardson. [Announcement]

Vidal has all the qualifications.  Bachelor’s and Master’s degrees in electrical engineering (starting college at age 16); JD from Penn (EIC of the law review); Federal Circuit clerkship (Judge Schall); registered patent attorney; and litigated patent cases in courts across the country, including the PTAB.  She represented Chamberlain whose garage door opener patents were obliterated by the eligibility revolution of BilskiMayo-and-Alice.  At the same time, Vidal has represented many accused infringers.

Great pick.  I have known Vidal for years, and am confident that she will be an amazing leader of the agency.

The Senate will need to confirm this appointment, but I do not foresee any holdup for this candidate.


The U.S. Court of Appeals for the Federal Circuit assesses the equitable powers of a legislative court: the Court of Appeals for Veterans Claims.

This guest post was authored by Joel Smith, a 3L at the University of Missouri School of Law, with support from the team at the Mizzou Law Veterans Clinic.

Why is there a post about a veterans law case on a patent law blog? The U.S. Court of Appeals for the Federal Circuit (the “Federal Circuit”), of course! Like patent office cases, when decisions of the Veterans Administration (“VA”) are appealed to the federal court system, the cases are not heard in your everyday district courts, but instead in everyone’s favorite court with nationwide jurisdiction. Currently pending before the en banc Federal Circuit is Taylor v. McDonough, No. 2019-2211 (Fed. Cir.).

The case involves the plight of Bruce R. Taylor, a Vietnam era Army veteran seeking compensation for disabilities resulting from his service. Before serving two tours overseas, Mr. Taylor volunteered to serve his country in a unique fashion—as a test subject. In 1969, the Army sought soldiers on which it would test toxic chemicals such as nerve gas. The Army’s purpose was to learn how its soldiers would function when exposed to agents that combatants might experience in service. Soldiers were given doses of an array of toxic substances and subjected to training exercises to measure performance. As a result of Mr. Taylor’s participation, he suffers from disabilities that the VA found eliminate his ability to work. In accordance with statute, the VA awarded Mr. Taylor monthly compensation.

Since the VA awarded benefits, what is the problem?

In addition to monthly compensation, the VA is required to pay lump sum compensation covering the time before benefits were awarded. Despite Mr. Taylor having suffered from his disabilities since he left the Army in 1971, the VA is refusing to provide backpay for the time between his service and when he filed his benefits claim in 2007. The VA cites a statute that limits the effective date of claims–which determines the start date for back pay–to when the veteran filed for benefits. 38 U.S.C. § 5110(a)(1) provides that “the effective date of an award…shall not be earlier than the date of receipt of application[.]”

Mr. Taylor claims the government interfered with his statutory right to disability compensation. Prior to participating in the tests, Mr. Taylor was required to sign an oath of secrecy that, if broken, would subject him to criminal prosecution and a dishonorable discharge—a rating that would render him ineligible for benefits. To file an adequate claim for disability benefits, Mr. Taylor would have needed to disclose his test participation. The “catch-22” of being unable to file for benefits without becoming ineligible for benefits left Mr. Taylor with an inability to exercise his statutory right to request disability compensation.

In 2006, the Department of Defense finally declassified the names of the test participants and instructed the participants to file for benefits. Mr. Taylor did so in early 2007. The VA responded to the claim by awarding monthly disability benefits with an effective date of 2007. Mr. Taylor requested the VA to instead award an effective date of the day after his discharge due to the aforementioned government interference. After exhausting his administrative remedies without relief, Mr. Taylor petitioned a legislative court created for the sole purpose of reviewing decisions of the VA, the Court of Appeals for Veterans Claims (the “Veterans Court”).

Mr. Taylor asked the Veterans Court to apply the doctrine of equitable estoppel to prevent the VA from asserting § 5110 as a defense against his claim for an earlier effective date. Mr. Taylor indicates that but for the oath he would have filed for benefits in 1971. The Veterans Court denied his request because it interpreted its jurisdictional and scope of review statutes as excluding equitable estoppel as an available remedy. The present case is Mr. Taylor’s appeal to the Federal Circuit.

Initially, a three-judge panel held the Veterans Court does possess the power to apply equitable estoppel. The Federal Circuit then voted to rehear the case en banc and the panel decision was vacated. In response to the court’s request for new briefs, the NLSVCC and the Mizzou Law Veterans Clinic filed an amicus brief in support of Mr. Taylor.

The amicus brief argues that the scope of review statute for the Veterans Court, 38 U.S.C. § 7261, does not foreclose the use of equitable estoppel. The legislative history of the statute indicates that Congress initially desired judicial review of VA decisions to occur in Article III courts, with their full judicial power, and fashioned the legislative court that is the Veterans Court only out of concerns regarding the expertise of federal courts and the burden on the federal court system. The history indicates a strong overriding concern for fairness and no concern regarding limiting the use of equitable remedies in veterans cases. The brief also addresses that other legislative courts, such as the bankruptcy and tax courts, possess equitable powers and the Veterans Court’s powers should be evaluated in light of those general designs.

A primary legal hurdle for Mr. Taylor is a precedent in the Federal Circuit. In Burris v. Wilkie, 888 F.3d 1352 (Fed. Cir. 2018), the court determined that applying equitable estoppel was outside the jurisdiction of the Veterans Court. The amicus brief distinguishes Mr. Taylor’s case from Burris by relying on a Supreme Court precedent that held that procedural claims-processing rules do not limit jurisdiction. See Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428 (2011). Characterizing the effective date statute as a procedural rule, the amicus argue that, unlike the substantive statutes relevant to Burris, deviating from the effective date statute would not expand the Veterans Courts jurisdiction because the effective date limit is procedural.

The amicus brief concludes:

In 1990, the Supreme Court left for another day, “whether an estoppel claim could ever succeed against the Government.” Off. of Pers. Mgmt. v. Richmond, 496 U.S. 414, 423 (1990). Three years ago, this Court stated that it had not yet determined “just how far the equitable powers of the Veterans Court, as an Article I tribunal, extend.” Burris v. Wilkie, 888 F.3d 1352, 1361 (Fed. Cir. 2018). In Burris, that question was left for another day.

That day has arrived. Veteran Taylor’s case presents the strongest possible facts upon which this Court should determine equitable estoppel against the Government may succeed, and the Veterans Court has the power to provide such relief.

Briefing is ongoing in the appeal.

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On Oct 29, 2021, the Veterans Clinic is hosting its 8th Annual Symposium.  The symposium is online and free.  Because of their link with the Federal Circuit, veterans cases offer an excellent place for patent attorneys to do pro bono work.  More information here:



Modified Opinion for Hyatt on Purposeful Submarining

Hyatt v. Hirshfeld, 9 F.4th 1372, 1374 (Fed. Cir. 2021), opinion modified and superseded on reh’g, 2020-2321, 2021 WL 4737737 (Fed. Cir. Oct. 12, 2021) [New Opinion]

Earlier this month, the Federal Circuit released a revised opinion in the most recent edition of Hyatt v. Hirshfeld.  The opinion originally released in August 2021 denied the USPTO’s petition to recoup expert witness fees under the “all the expenses” provision of 35 U.S.C. 145.  The original opinion called out Hyatt for “efforts to submarine his patent applications and receive lengthy patent terms.”  Following that decision, Hyatt petitioned for rehearing, asking for removal of that language from the opinion.  The PTO did not file a brief in opposition and the court released a modified opinion with the language removed.  The redline below shows the change:

In the briefing, Hyatt explained that the statement was incorrect, unnecessary, unsupported, and prejudicial to his position on remand.  The petition is a very good example of how to seek targeted relief from a panel for a narrow, but potentially important issue. [HyattRehearingPetition]

Surgisil, Subject Matter, and Scope

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

In an earlier post, Professor Crouch discussed the Federal Circuit’s recent decision in In re Surgisil. In that decision, the Federal Circuit recognized that 35 U.S.C. § 171 provides for the grant of patents for designs for articles of manufacture, not designs in the abstract. In doing so, the court’s decision was in accord with the rationale—if not the limited express holding—of its earlier decision Curver Luxembourg.

Professor Crouch is correct that this holding means that the scope of § 102 prior art for designs is limited. And yes, it means you could take a shape developed for one article of manufacture and apply it to a different type of article and potentially get a design patent for it. But there is nothing wrong with that. Designing a shape for a binder clip, for example, is a different design problem than designing a shape for a handbag. Using the shape of the former for the latter could be a valuable act of design, as I argued in this article (which was relied on heavily by Surgisil though not cited by the court).

There may be cases where this kind of shape adaptation might be obvious, but that is a problem for § 103, not § 102. It is true that, for utility patents, the universe of prior art for § 102 is broader than it is for § 103. But, given the different nature of the inventions protected and the different claiming conventions, it makes sense to treat designs differently.

I respectfully disagree with Professor Crouch’s suggestion “Surgisil is in some tension with precedent holding that the claim scope should be limited only to ornamental features.” The cases he cites, In re Zahn and OddzOn, deal with entirely different issues—the concept of what constitutes a protectable “design” in Zahn and the question of “functionality” filtering in OddzOn. (And in any case, Zahn is a terrible decision that should be overruled.)

And there is nothing inconsistent about recognizing that a design patent’s scope should be tethered to the claimed article and the principle that design patents protect how things look, not how they work. Recognizing that the statutory subject matter here is a design for a surgical implant does not change the fact that the patent’s scope extends only the claimed visual appearance. The court’s decision in Surgisil does not mean that the use of the article is protectable per se; it merely limits the scope of the patent to instances in which the accused product is directed to the same design problem. And none of the cases cited by the USPTO require design patents to cover designs per se.

One more thing: At oral argument, the USPTO argued that its “article doesn’t matter” approach was necessary to effectuate the idea of the “broadest reasonable interpretation” (BRI) of a design patent claim. BRI is a concept that was developed in the context of utility patents and it’s not clear that it has any useful application to design patents. But to the extent that it does, the BRI of a design patent claim might be something like Egyptian Goddess step 1—i.e., the shape (or surface design) in the abstract, considered without consideration of any potentially narrowing prior art.

Federal Circuit Further Eases Path for Obtaining Design Patents

Not a Trademark Case: Edible vs Google at the Georgia Supreme Court

by Dennis Crouch

Edible IP v. Google (GA 2021)

This interesting case is pending before the Supreme Court of Georgia over the question of keyword advertising under Georgia law.  The following comes from Edible’s brief:

Edible’s claim is simple. It owns valuable intangible property associated with the trade name “Edible Arrangements.” The law [of Georgia] protects its right to exclude others from trading on that name and its associated good will for profit. The Complaint alleges that when Google auctions off that name and the associated business goodwill, Google violates Edible’s rights to exclude others from its property and appropriates the value of Edible’s goodwill for itself. As a matter of fact, this is an illegal [theft-by-]taking, and Edible can introduce evidence within the framework of the Complaint to prove each cause of action.

The trial and appellate courts both sided with Google, holding that keyword advertising is akin to permissible sponsored product placement in grocery stores.  The Supreme Court is set to hear oral arguments in the case on November 10, 2021.

Google argues that any decision in Edible’s favor would be contrary to federal trademark law and be in violation of the free speech provision of the First Amendment of the U.S. Constitution.

Google may have cleaned-up its advertising in the lead-up to the Supreme Court arguments. My search on Oct 18, 2021 revealed no ads showing up for “Edible Arrangements” but one of the top hits is a rhetorical question from Google “Is Edible Arrangements overpriced?”

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NOT a TM Case: A key aspect of the case is that Edible is not on suing trademark law.  Rather the cause of actions center on state statutes involving theft of personal property.  “Customer confusion is not an element of any of Edible’s claims.”  Edible’s Brief.   In its argument, Google argues for a bright line rule that Georgia courts cannot enforce rights to trade-names absent fraud, deception, or confusion.  According to Google, any broader rights would impinge upon the company’s freedom to sell competitive advert-space tied to Edible’s name as protected by the First Amendment.

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Edible International, LLC is the company that franchises the basket delivery.  The plaintiff here Edible IP, LLC is the company that owns the trademarks. Edible IP licenses the marks to Edible International.   It is not clear to me the exact relationship between these two companies, but they are obviously related.

Edible International opened an advertising account with Google, and clicked “I agree” to Google’s terms that included an agreement to arbitrate any resulting disputes.  The district court found this was binding on Edible IP, and that issue is also before the Georgia Supreme Court. Edible IP argues that it should not be bound by the actions of its Edible International relation.

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The International Franchise Association filed a brief in support of Edible: “Google’s advertising model is profiting directly from using the trade names and goodwill of established companies for profit. This use is antithetical to fair business practices and the law, and it should not be allowed.”

Pending patent legislation: 

by Dennis Crouch

Attorney fees awarded since patentee knew it had a losing case.

by Dennis Crouch

This decision suggests that the Federal Circuit is acceding to the Supreme Court’s approach giving broad discretion to the district courts in attorney fees cases rather than nit-picking individual elements of the totality-of-the-circumstances test.  But, we’ll see. 

Energy Heating, LLC v. Heat On-the-Fly, LLC (Fed. Cir. 2021)

In a prior appeal in this case, the the Federal Circuit affirmed the lower court’s holding that Heat On-The-Fly’s U.S. Patent No. 8,171,993 was unenforceable due to inequitable conduct.  By the critical date (1-year-before-filing), the patentee had done about $2 million in jobs using the invention, but did not disclose those sales/uses to the USPTO during prosecution.

On remand, the district court awarded attorney fees to the defendants — finding the large number of undisclosed sales sufficient to constitute “affirmative egregious conduct” and then pursued aggressive litigation despite knowing that the patent was invalid.

The patent act provides a district court with discretion to award “reasonable attorney fees to the prevailing party” in “exceptional cases.”  Once you have a prevailing party, the district court needs to determine whether the case is “exceptional.”  If so, the district court will then determine whether to award attorney fees, and the amount to award.  These determinations are within the district court’s equitable discretion based upon a broad “totality of the circumstances”  test.  On appeal, the district court’s factual and equitable determinations are given deference and only overturned based upon an abuse of discretion. Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545 (2014); Highmark Inc. v. Allcare Health Mgmt. Sys., Inc., 572 U.S. 559 (2014).

On appeal, the patentee challenged the “exceptional case” finding, but the appellate panel found no abuse of discretion.

Inequitable conduct is an equitable defense that is traditionally decided by a judge rather than a jury.  An oddity of the case is that the jury was actually asked whether the patentee had represented in bad faith that it held a valid patent as part of the defendant’s state law claim counterclaim of “deceit.”In the appeal, the patentee argued that it was improper for the district court to rely upon the jury’s bad faith determination. I don’t understand that argument and neither did the Federal Circuit.

The jury found bad faith, but actually sided with the patentee on the ultimate question of deceit under N.D. Law.  On appeal, the patentee argued that the no-deceit conclusion should be determinative of no inequitable conduct as well. Of course, the prior appeal determined inequitable conduct and the Federal Circuit did not allow the issue to be relitigated in this appeal. The Federal Circuit did rule though that “the jury’s finding of no state-law ‘deceit’ simply has no bearing on inequitable

Finally, the patentee noted the absence of an express finding of litigation misconduct absent continuing to litigate losing positions. On appeal, the Federal Circuit found no problem with finding the case exceptional even absent particular litigation misconduct issues.

Federal Circuit Rejects Arguments of Bias at the PTAB

Mobility WorkX v. Unified Patents (Fed. Cir. 2021)

In a 2-1 decision, the Federal Circuit has rejected Mobility’s argument that the PTAB Judges have an improper financial interest in instituting AIA proceedings.  The baseline here is that the patentee presented evidence that Board members who institute more AIA proceedings receive better performance reviews and more bonus money.  A higher institution rate also ensures job stability for administrative patent judges.  The argument then is that those incentives to institute constitute a due process violation under cases such as Tumey v. Ohio, 273 U.S. 510 (1927) and Ward v. Monroeville, 409 U.S. 57, 60 (1972).

To be clear, none of the USPTO rules or practices provide expressly give more money or quota-points for initiating IPR.  However, the only way to receive points for judging an IPR is to first institute the IPR. And, most of the quota-points are accumulated post-institution.  Likewise, the PTO receives substantial fees for institution.

The majority entertained the arguments, but ultimately rejected them after concluding that any financial interest was too remote.

Amicus curiae US Inventor, Inc. presents a statistical study purportedly showing that there are more meritorious institution decisions in September (at the end of the APJ performance review year) than in October (at the beginning of the performance review evaluation period). This hardly establishes that APJs are instituting AIA proceedings to earn decisional units.

Slip Op. at Note 7.

The majority decision was authored by Judge Dyk and joined by Judge Schall.

Judge Newman wrote in dissent arguing that the status quo creates the potential appearance of bias and that it is the Federal Circuit’s responsibility to resolve the concerns.

Disclaimer in Prosecution cannot be Recaptured in Litigation

by Dennis Crouch

Traxcell Technologies, LLC v. Sprint Communications Company, No. 20-1440 (Fed. Cir. 2021); Traxcell Technologies, LLC v. Nokia Solutions and Networks, No 20-1440 (Fed. Cir. 2021)

The patentee primarily these cases on claim construction on two simple terms — based largely on statements made during prosecution to skirt the prior art. 

“Location” – some of the asserted claims take various actions related to the “location of [a] mobile wireless device.”  During prosecution the patentee had argued that its location ability was not limited to “a position in a grid pattern” and did not require a grid pattern overlay.  Rather its location sense was more “adaptable” and “refined.”  The courts found this clear prosecution history disclaimer and so the location term is properly construed to require “not merely a position in a grid pattern.”  This construction excused Nokia from infringement, since the accused Nokia system is arranged in a grid of 50-meter-by-50-meter bins.

“A Computer” – the claims all required “a computer” or “first computer.” The problem was that the accused devices performed the various functions across a set of computers. The district court construed “first computer” and “computer” to mean a single computer that can perform each and every function.  That construction was affirmed on appeal after the Federal Circuit reviewed the claims and specification for supporting evidence.

[I]t would defy the concept of antecedent basis—for the claims to recite “the computer” or “said first computer” being “further” programmed to do a second set of tasks if a different computer were to do those tasks instead.

Slip Op.  This interpretation was also confirmed by the prosecution history statement including a responsive argument submitted to the PTO titled ““Single computer needed in Reed v. additional software needed in Andersson.”  Reed is the Traxcell patent; Andersson was the prior art.  One computer requirement meant no infringement. 

Means For: The case against Sprint partially turned on a means-plus-function limitation: “means for receiving said performance data and corresponding locations from said radio tower and correcting radio frequency signals of said radio tower.”  The patentee pointed to an algorithm disclosed in the specification as the corresponding structural disclosure.  Under Section 112(f), a means-plus-function claim “shall be construed to cover the corresponding structure … in the specification and equivalents thereof.”  It was clear that Sprint did not use the identical algorithm, but the question was whether the “equivalent” penumbra of the claim was broad enough.  In order to determine equivalents under Section 112, the district court applied the function-way-result test generally used in DOE cases.  See Applied Med. Res. Corp. v. U.S. Surgical Corp., 448 F.3d 1324 (Fed. Cir. 2006).  Generally, the function-way-result test ends up with a quite narrow band of equivalents.  Here, the court found that the accused activity not proven to be done “substantially the same way” as that claimed and so was not an equivalent. An aspect of this doctrine that continues to create confusion is whether this “equivalent” evidence is an element of claim construction as suggested by the statute or instead post-construction infringement analysis.

Indefiniteness: Some of the claims were also invalidated as indefinite, even after a certificate of correction. In particular, the those claims required a “means for … suggesting corrective actions . . based upon . . . location” but the specification did not disclose how that might take place. On appeal, the Federal Circuit affirmed. “Although Traxcell demonstrated that the structure makes corrections based on other performance data, it hasn’t shown that any corrections are made using location.”

The Federal Circuit uses a simple if-then shortcut for its indefiniteness analysis of claims that include means-plus-function language. If the specification lacks sufficient structure to support the claimed means; Then the claim is invalid as indefinite.  This approach is probably too rule based. Rather, each time the Federal Circuit should use its lack-of-structure analysis to ask does the claim at issue “particularly point[] out and distinctly claim[] the subject matter which the inventor or a joint inventor regards as the invention.” 35 U.S.C. 112(b).

The four asserted patents U.S. Patent Nos. 8,977,284 (“the ’284 patent”), 9,510,320 (“the ’320 patent”), 9,642,024 (“the ’024 patent”), and 9,549,388. 

En Banc Petition: Counting to Two Alice Style

by Dennis Crouch

Apple Inc. v. Universal Secure Registry LLC, Docket No. 20-01223 (Fed. Cir. 2021)

In August, the Federal Circuit sided with Apple and affirmed the district court determination that USR’s asserted claims were all directed to abstract ideas — and thus ineligible under 35 U.S.C. § 101. When I first wrote about the original decision, I noted the high correlation between the two steps of Alice: “if a claim fails step one, it usually fails step two as well.”  However, this particular decision stood-out because of the extent that the step-one analysis “borrow heavily from typical step two analysis.”  Crouch, When Two become One, Patently-O (Aug 29, 2021).

USR has now petitioned for en banc rehearing, and focused-in on the panel’s overlapping analysis regarding step one and step two. Questions presented:

  1. Whether step one of the Alice test for patentable subject matter requires a showing of “specificity,” “unexpected results” or unconventional claim elements.
  2. Whether the two steps of the Alice test are distinct requirements that must both
    be separately met to invalidate a patent claim.

USR Apple Petition.

Alice Corp v. CLS Bank: When Two Become One

The patents at issue are related to securing electronic payments without giving a merchant your actual credit card number. The merchant is given a time-varying code instead of a credit card number.  That code is then sent to the credit card company servers for authorization, including any restrictions on transactions with the merchant.  The company then either approves or denies the transaction.  This approach allows for purchases without actually providing the merchant with the “secure information” such as the credit card or account number.

In rejecting the claims, the court noted that cases “often turn[] on whether the claims provide sufficient specificity to constitute an improvement to computer functionality itself.” Universal Secure Registry LLC v. Apple Inc., 10 F.4th 1342 (Fed. Cir. 2021). I read this as requiring: (1) that the claims be drafted with specificity; and (2) that the element claimed by an “improvement to computer functionality.”  Generic claims are not enough; neither are specific claim limitations directed toward elements already well known in the art. The court found that the claims were directed toward “conventional actions in a generic way.”  That conventional-generic combination was enough to fully answer both steps of the Alice analysis.

USR’s petition argues that the decision improperly conflates the two steps of Alice:

At step one, the panel imposes a heightened “specificity” requirement for patents on authentication technology; requires “unexpected results” and “unconventionality”; and imports into Section 101 the definiteness requirement of Section 112—none of which has any basis in the statute or Supreme Court precedent. At step two, the panel opinion collapses Alice/Mayo’s two distinct steps into one by applying the same analysis as at step one.


The petition here was filed prior to the Federal Circuit’s recent decision in CosmoKey Sols. GmbH & Co. KG v. Duo Sec. LLC, 2020-2043, 2021 WL 4515279 (Fed. Cir. Oct. 4, 2021).  In that case, the majority skipped Alice Step One, but then relied upon seeming step-one analysis to make a determination regarding Alice Step Two.  Both decisions were authored by Judge Stoll.

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Claim 22 of U.S. Patent Nos. 8,856,539:

A method for providing information to a provider to enable transactions between the provider and entities who have secure data stored in a secure registry in which each entity is identified by a time-varying multi character code, the method comprising:

receiving a transaction request including at least the time-varying multicharacter code for an entity on whose behalf a transaction is to take place and an indication of the provider requesting the transaction;

mapping the time-varying multicharacter code to an identity of the entity using the time-varying multicharacter code;

determining compliance with any access restrictions for the provider to secure data of the entity for completing the transaction based at least in part on the indication of the provider and the time-varying multicharacter code of the transaction request;

accessing information of the entity required to perform the transaction based on the determined compliance with any access restrictions for the provider, the information including account identifying information;

providing the account identifying information to a third party without providing the account identifying information to the provider to enable or deny the transaction;

and enabling or denying the provider to perform the transaction without the provider’s knowledge of the account identifying information.

How does the USPTO Decide the Discretionary Aspect of Institution?

by Dennis Crouch

US Inventor Inc. v. Hirshfeld, No. 21-40601 (5th Cir. 2021)

In February 2021, US Inventor and others collectively sued the USPTO asking the court to order the USPTO to issue rulemaking regarding discretionary considerations at the institution stage of AIA Trials.  That case is now on appeal.

Standards for Discretionary Dismissals: The statute particularly requires the PTO Director to issue regulations “setting forth the standards for the showing of sufficient grounds to institute a review [and] shall consider the effect of any such regulation on the economy, the integrity of the patent system, the efficient administration of the Office.” 35 U.S.C. 316.  Although the USPTO has issued regulations about what counts as “sufficient grounds” to institute, the regulations do not consider discretionary denials, a potentially key aspect of the institution decision.  Of course, the importance of discretion depends upon how discretion is wielded.  The PTO has declared a “standard operating procedure,” and the plaintiff here argues that the SOPs were illegal rulemakings (“promulgated without lawful adherence to the strictures of the Administrative Procedure Act.”).

Abuse of Discretion: Courts and administrators are often given discretionary authority to make decisions.  But, discretion still requires that the decision-maker make a non-arbitrary decision that at least has a rational basis after considering both the law and the evidence at hand.  Arbitrary decisions represent an abuse of discretion and are regularly overturned on appeal.  AIA Trial Institution decisions are problematic to that general scheme because institution decisions are not appealable. Administrative Procedure Act (APA) to the rescue with 5 U.S.C. 706 authorizing actions to compel agency to stop any behavior that is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”

Hurdle of Concrete Harm: Although the APA permits an action to compel agency action, the statute typically requires that the plaintiff be “a person suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action.” 5 U.S.C. 702.  In addition to this statutory injury requirement the Supreme Court has also interpreted Article III of the U.S. Constitution to require that the plaintiff identify some concrete harm caused by the defendant’s action (or inaction).  The case must be dismissed for lack of standing absent that concrete harm.

In this case, the PTO argued (1) that the statute does not require rules on that discretionary aspect of institution. And, (2) even if it was supposed to put the rules in place, the plaintiffs here have not suffered any concrete harm due to the lack of regulations.

Case Dismissed: Judge Gilstrap dismissed the case in July 2021 — agreeing with the USPTO that the plaintiffs lacked standing. The court’s opinion suggests that a patentee might never have standing for such a challenge:

For patentees, the notion of a concrete interest in discretionary denials of AIA petitions is particularly tenuous. Although the institution decision is a step on the road to invalidation, there is no dispute that discretionary denials under §§ 314(a) and 324(a) necessarily occur in situations where the PTAB has proper authority to institute. There is also no apparent dispute that the PTAB can exercise that discretion, at least on a panel-by-panel basis. As a result, the factors considered in the challenged PTAB decisions are neither dispositive nor exclusive. In the case of a discretionary denial, there is no harm to patentees because the proceeding ends and the patent rights are unaffected; the status quo is maintained.

District Court Dismissal Order. I struggle to understand the court’s logic associated with panel-to-panel variance. If that variance is due to different standards being applied then the situation seems to be begging for agency regulation.  Judge Gilstrap’s decision is now on appeal.

Where to Appeal?: One quirk of the appeal is that it is not entirely clear whether the case should go to the Fifth Circuit or the Federal Circuit.  US Inventor’s attorney Robert Greenspoon decided to play-it-safe to make sure he preserved his right to appeal by filing a notice of appeal in both courts.  Greenspoon asked the Federal Circuit to then pause the appeal deadlines until the Fifth Circuit determines whether jurisdiction is appropriate. And, the Federal Circuit has granted that motion.

In the Fifth Circuit, the USPTO filed a motion to dismiss the appeal–arguing that the case arose under the patent laws and therefore should go to the Federal Circuit.  Rather than deciding that issue directly, the Fifth Circuit has announced that it will carry that motion to the merits oral arguments and decided it all together.

Section 1295 provides statutory guidance as to when an appeal is directed to the Federal Circuit.

(a)The United States Court of Appeals for the Federal Circuit shall have exclusive jurisdiction—(1) of an appeal from a final decision of a district court of the United States … in any civil action arising under, or … in which a party has asserted a compulsory counterclaim arising under, any Act of Congress relating to patents or plant variety protection.

28 U.S.C. 1295 (Jurisdiction of the United States Court of Appeals for the Federal Circuit).

Arising under the Patent Laws: A key underlying issue in the case is the extent that the patent laws require the USPTO to issue certain regulations.  In other words, the patent laws are integral to the lawsuit.  At the same time, the actual cause of action does not stem from the patent laws but rather from the Administrative Procedure Act (APA).  The Supreme Court has explained that the first go-to for arising under jurisdiction is the cause of action. Nonetheless, a case may still arise under the patent laws if “plaintiff’s right to relief necessarily depends on resolution of a substantial question of federal patent law.” Christianson v. Colt Indus. Operating Corp., 486 U.S. 800 (1988).

The Federal Circuit has repeatedly held that APA cases such as the one here do arise under the patent laws–meaning that any appeals should be heard by the Federal Circuit.  See, for example, Helfgott & Karas v. Dickinson, 209 F.3d 1328 (Fed. Cir. 2000) and Star Fruits S.N.C. v. United States, 393 F.3d 1277 (Fed. Cir. 2005) (Because APA claim “involves the Director’s duties ‘[i]n the course of examining or treating a matter . . . in a reexamination proceeding,’ it raises a substantial question under the patent laws” over which the Federal Circuit has exclusive jurisdiction).  However, those decisions were released prior to the Supreme Court’s most recent statement on the issue. Gunn v. Minton, 568 U.S. 251 (2013).

Gunn was an attorney negligence case brought under Texas state law, but the case was depend upon whether the attorney erred in his application of federal patent law. The Federal Circuit had previously found that this type of case raised substantial patent law questions and therefore should be heard in Federal Court with appeals going to the Federal Circuit. In Gunn, the Supreme Court disagreed with that approach and explained instead that state-law based attorney malpractice “will rarely, if ever, arise under federal patent law.”  Gunn paralleled its analysis to that of a the prior non-patent arising under case Grable & Sons Metal Prod., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308 (2005) and concluded that the patent issues at stake in the malpractice case were not “substantial” in the context of the patent system as a whole. Although the patent issues in the malpractice case may have been important to the parties involved, nothing from that case was going to make any difference to the patent laws or federal patent litigation.

The USPTO does not cite or mention the Gunn decision in its motion in the 5th Circuit appeal in US Inventor.  One reason perhaps is that Gunn focuses on a slightly different situation.

  • Gunn: Whether the lawsuit “arises under” the patent laws and thus gives a Federal District Court original jurisdiction under 28 USC 1338.
  • US Inventor: Whether the lawsuit “arises under” the patent laws and thus gives the Court of Appeals for the Federal Circuit appellate jurisdiction under 28 USC 1295.

Both Section 1338 and Section 1295 use the identical “arising under” language and nothing in the legislative history suggests to me that they should be interpreted differently. Both of these provisions channel patent cases into certain courts for the purpose of “the development of a uniform body of law.”  Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141 (1989). In Gunn, the court explained that:

Congress ensured such uniformity by vesting exclusive jurisdiction over actual patent cases in the federal district courts and exclusive appellate jurisdiction in the Federal Circuit.

Gunn (referring to Section 1338 and Section 1295 respectively). Still, there is some tension between the two provisions that comes out of Gunn. In particular, the Supreme Court’s reticence to expansive federal jurisdiction was grounded in principles of federalism. The Court recognized that a local interest of states in having state courts decide cases arising from state law.  In order to deprive states of those cases, the patent issue must be substantial.   One outcome of Gunn is that state courts are now more often hearing patent law issues as they arise in various non-patent causes of action.

This state vs federal debate is only relevant in the context of original jurisdiction questions under Section 1338 where a case might be filed in state court or instead in federal court.  There are no such federalism concerns in US Inventor – rather the question is which of two federal appellate courts will hear the appeal. This difference offers one reason to interpret the two statutes a bit differently, perhaps requiring more substantiality in one situation than in the other. But, I would suggest that tweaking is not worth the candle and probably not what Congress intended. And, the Federal Circuit has agreed in post-Gunn decisions that the Gunn analysis impacts both Section 1295 and 1338.  Bottom line here is that the USPTO should not have simply relied upon its pre-Gunn APA decisions.

In his 2019 article, Prof. Paul Gugliuzza proposes a simple rule that is consistent with both statutes and the requirements of Gunn.

For a case that does not involve claims of patent infringement to nevertheless arise under patent law, it must present a dispute about the content of federal patent law or a question about the interpretation or validity of the federal patent statute; questions about the validity or scope of a particular patent are not sufficient.

Paul R. Gugliuzza, Rising Confusion About “Arising Under” Jurisdiction in Patent Cases, 69 Emory L.J. 459 (2019).  Although Gugliuzza’s proposal here is straightforward, the parties in US Inventor disagree as to the outcome of the test.

The 5th Circuit appeal is now in-briefing and we’ll will likely not see a decision in the case until 2022.

Trademark: Uggs are generic in Australia, Can I import them without a license from UGG®?

by Dennis Crouch

In Australia, the term “ugg boots” refers to a general style of sheepskin shoe with the fleece turned in for warmth.  It is a generic term, and not a trademark – in Australia.  And, there are dozens of companies that make and sell ugg boots in that country, including Australian Leather Pty. Ltd..  The original name “ugh” came from 1970s surfer Shane Stedman who has been quoted as saying “We called them Ughs because they were ugly.”

UGG is a registered trademark in the USA, now owned by Deckers Outdoor Corp. Back in 2016, Deckers learned that Australian Leather had imported 12 pairs boots labelled “ugg boots” into the USA and sued for trademark infringement.  The defendant argued that it should be able to import its boots to the US since the term is generic in Australia, but the district court sided with the plaintiff in rejecting that defense. On appeal, the Federal Circuit affirmed in a R.36 Judgment without any opinion (the original complaint included some design patents as well).

Australian Leather has now petitioned to the U.S. Supreme Court, asking two questions:

1. Whether a term that is generic in the English-speaking foreign country from which it originated is ineligible for trademark protection in the United States.

2. Whether and, if so, how the “primary significance to the relevant public” standard in 15 U.S.C. § 1064(3) for determining whether a registered trademark has “become” generic applies where a term originated as generic before registration.

[Petition]. This is an interesting new trademark petition that suggests some nuance from the Court’s 2020 decision in BOOKING.COM.


Jury Verdict on the Factual Underpinnings of Eligibility

by Dennis Crouch

Infernal Tech LLC v. Sony Interactive Entertainment LLC (E.D.Tex. 2021)

Today’s jury verdict in E.D. Tex. favored the accused infringer Sony.  The patentee alleged that Sony’s Spider-Man and God of War games infringed its U.S. Patent Nos. 6,362,822 (claim 1) and 7,061,488 (claims 1, 27, and 50.  The jury found, however, that neither game infringed.


The more interesting part of the jury verdict was Question 2 where Judge Gilstrap asked the jury to opine on the factual underpinnings of Alice Step 2. In particular, the jury was asked whether Sony had proven “by clear and convincing evidence that the Asserted Claims only involve technologies and activities that were well-understood, routine, and conventional, from the perspective of a person of ordinary skill in the art, as of [the Filing Date].”   The jury sided with the defendant and answered “yes.”  The case will next go through some post-verdict motion practice (JNOV/New-Trial) and then will likely be appealed. However, barring some claim construction problem it will be difficult to overcome this non-infringement decision on appeal.

Claim 1 of the ”822:  A shadow rendering method for use in a computer system, the method comprising the steps of:

providing observer data of a simulated multi-dimensional scene;

providing lighting data associated with a plurality of simulated light sources arranged to illuminate said scene, said lighting data including light image data;

for each of said plurality of light sources, comparing at least a portion of said observer data with at least a portion of said lighting data to determine if a modeled point within said scene is illuminated by said light source and storing at least a portion of said light image data associated with said point and said light source in a light accumulation buffer; and

then combining at least a portion of said light accumulation buffer with said observer data; and

displaying resulting image data to a computer screen.

The plaintiffs in the case are represented by Buether Joe LLP out of Dallas and the Defendants by Erise IP out of Kansas City. 

Avoiding IPR via Contract

by Dennis Crouch

Kannuu Pty. LTD v. Samsung Electronics Co., LTD (Fed. Cir. 2021)(KannuuSamsungDecision)

US Courts typically enforce choice-of-forum provisions found within contracts between two business entities.  Here, Kannuu and Samsung entered into a non-disclosure agreement as part of a potential deal, and the contract included a choice-of-forum provision that directed “any legal action” stemming from the agreement to courts located in New York City “and no other jurisdiction.”  The potential deal fell apart and Kannuu eventually sued Samsung for patent infringement.  Samsung responded with an inter partes review (IPR) petition. Kannuu then asked the USPTO to drop the petition based upon the forum-selection-clause and, failing that, also petitioned the district court for an order that Samsung drop the IPR.  The district court denied Kannuu’s motion for preliminary injunction and then appealed.

On appeal, the court centers-in on the issue:

The underlying question that this case presents is one of first impression: Does the forum selection clause in the non-disclosure agreement between the entities prohibit Samsung from petitioning for inter partes review of Kannuu’s patents at the Board?

Slip Op. Apart from the general legal question of whether such a clause can operate to keep the case out of IPR, Kannuu’s case has a more fundamental problem identified by the district court — “the plain meaning of the forum selection clause in the NDA [does] not encompass the inter partes review proceedings.” Slip Op.

The district court case is only at the preliminary injunction stage, and the appellate panel found no abuse of discretion in the district court’s finding that the IPR proceedings are not covered by the agreement since the agreement focuses on confidentiality rather than intellectual property rights.

On the bigger question of whether such a contract, if properly drafted, might be enforceable, the court explains that it “might” work:

Had Kannuu and Samsung entered a contract which applied to inter partes review proceedings, a forum selection clause in that hypothetical contract might permit Kannuu to avoid inter partes review and its inherent features. But, they did not enter such a contract.

Id.  The court has previously found such a clause enforceable to prevent a post-grant-review proceeding, but only in a non-precedential opinion. Dodocase VR, Inc. v. MerchSource, LLC, 767 F. App’x 930 (Fed. Cir. 2019).

The majority opinion was written by Judge Chen and joined by Judge Prost.

Writing in dissent, Judge Newman argued that “the forum selection clause is clear and unambiguous, and law and precedent require that it be respected and enforced.”

= = =

I should note that the patent at issue here has the auspicious title of “Process and apparatus for selecting an item from a database.” [Link]

Federal Circuit Further Eases Path for Obtaining Design Patents

by Dennis crouch

In re Surgisil, LLP, — 4th — (Fed. Cir. 2021).

This is an important design patent decision that substantially narrows the scope of prior art available for anticipation rejections in design patent cases.  The result is that it should become easier to obtain design patent protection.  The decision is only about 600 words long — fewer than may writeup about the case. 

My children have a variety of paper stumps that they use for smoothing and blending their pencil drawings. The first image below shows a typical paper stump that artists have been using for many decades. The second image shows the design for Surgisil’s article of manufacture that it is attempting to patent (design patent).  I also recall being fascinated by double-sharpened pencils that you can see in the third image. 

Although the three are basically identical in shape, Surgisil still believes it should be able to obtain a design patent because its patent is directed toward something different, the “ornamental design for a lip implant.” 

The USPTO examiner rejected Surgisil’s claims and the Patent Trial & Appeal Board affirmed. The PTAB held particularly that for anticipation purposes, “it is appropriate to ignore the identification of the article of manufacture in the claim language.” Further, although these might not be analogous art, “whether a reference is analogous art is irrelevant to whether that reference anticipates.”

On appeal the Federal Circuit reversed and instead held that the Surgisil’s claim language limited its invention to a design for “lip implants.” As such, prior art directed to drawing stumps and pencils do not anticipate a lip implant.  The court explains:

Here, the claim identifies a lip implant. The claim language recites “a lip implant,” and the Board found that the application’s figure depicts a lip implant, As such, the claim is limited to lip implants and does not cover other articles of manufacture. There is no dispute that Blick discloses an art tool rather than a lip implant. The Board’s anticipation finding therefore rests on an erroneous interpretation of the claim’s scope.

Slip Op.

The decision here goes a bit further than Court’s 2019 decision in Curver Luxembourg, SARL v. Home Expressions Inc., 938 F.3d 1334 (Fed. Cir. 2019).  Curver Luxembourg held that a particular claim was limited to the wicker pattern applied on an the article of manufacture recited in the claim (a chair) and thus did not cover the use of the same pattern on a basket or other non-claimed article.  The PTO had attempted to distinguish that case as applying to the particular situation where the drawings do not actually show the claimed article of manufacture. In particular, the court held we “that claim language can limit the scope of a design patent where the claim language supplies the only instance of an article of manufacture that appears nowhere in the figures.”  The drawing in Curver was an abstraction showing only the wicker design, and so the claim was important to tie the design to a particular article of manufacture.

The terse Surgisil decision did not attempt to explain why this case extends beyond the language of Curver.

For many years, the USPTO has followed the same policy — the claimed article does not make any difference for anticipation purposes.  That rules stems from an old CCPA case known as In re Glavas, 230 F.2d 447, (CCPA 1956).

It is true that the use to which an article is to be put has no bearing on its patentability as a design and that if the prior art discloses any article of substantially the same appearance as that of an applicant, it is immaterial what the use of such article is. Accordingly, so far as anticipation by a single prior art disclosure is concerned, there can be no question as to nonanalogous art in design cases.

Id.  One problem with Glavas is that it was an obviousness case and so the statement above is dicta. The court previously recognized this dicta in Curver. The court also suggested that Glavas had been implicitly overruled by Egyptian Goddess.  In Egyptian Goddess, the en banc court held that the ordinary observer test applies to anticipation analysis. In that regard, an ordinary observer would not be likely to confuse a sharpened pencil with a lip insert. (Note, this last sentence is implied by the court in Curver, but not expressly stated).

Surgisil is in some tension with precedent holding that the claim scope should be limited only to ornamental features. See, e.g., In re Zahn, 617 F.2d 261 (CCPA 1980) (“[35 U.S.C] 171 refers, not to the design of an article, but to the design for an article.”);  OddzOn Prods., Inc. v. Just Toys, Inc., 122 F.3d 1396 (Fed. Cir. 1997) (design patent scope is limited to the ornamental features).  The appellate panel here did not address that argument presented by the USPTO on appeal.

Generally, the USPTO will see this case as a major change to anticipation analysis.  In the end, it will make it even easier to obtain design patents — and seemingly permits someone to obtain a design patent by grabbing a design that is known in the art and applying it to a new article of manufacture.