All posts by Jason Rantanen

About Jason Rantanen

Jason is a Law Professor at the University of Iowa College of Law.

Disuniformity

Patent,

By Jason Rantanen

Lee Petherbridge and I recently completed a draft of our empirical study of Federal Circuit doctrinal uniformity, a topic that ties in nicely with the recent debate over the Federal Circuit's exclusive jurisdiction over in patent cases. The piece is called Disuniformity and is available here.

The central finding of our study is a remarkable downward trend in decisional agreement between Federal Circuit judges over the past several years. Figure 1 from the study shows the degree to which all panel members agreed in precedential opinions in appeals arising from the district courts, presented as a 30-unit lagged average. 

Figure 1
While it is clearly the case that the rate at which these Federal Circuit opinions are unanimous exhibits some variation, the trend line suggests an over 20% drop in the rate at which panels were unanimous in precedential opinions between the end of 2004 and September 2013.

In the full article, available here, we dig deeper into what we think might be going on and offer some suggestions about what this growing trend of doctrinal disuniformity might mean for the debate over the court's exclusive jurisdiction in patent cases.

The article is still in the drafting stage, so any comments and critiques are welcome!

Here's the full abstract:

The Federal Circuit is a response to a failure in judicial administration that produced a fractured, unworkable patent law; one that Congress concluded ill-served entrepreneurship and innovation. The purpose of the response – vesting exclusive jurisdiction for patent appeals in the Federal Circuit – was to permit that court to develop patent law in the direction of greater clarity and uniformity. Both at the time of the Federal Circuit’s creation and more recently, scholars, judges, and practitioners have waged great debates over whether patent law uniformity furthers the ultimate goals of entrepreneurship and innovation. These debates have rested on a largely untested empirical proposition: that the Federal Circuit’s patent law jurisprudence embodies a move towards doctrinal uniformity. This paper reports an empirical study that examines patent law uniformity through the measure of open decisional disagreement between Federal Circuit judges. Its central empirical observation is a remarkable increase in decisional disagreement – indicative of a decline in doctrinal uniformity – among Federal Circuit judges over the past several years. The paper raises and discusses several possible explanations for its surprising observations, including, inter alia, the Supreme Court and personnel changes at the Federal Circuit. It also considers what the observations and explanations might contribute to a current debate over the merits of Congress’s decision to unify patent jurisdiction in the Federal Circuit.

Summary of Oral Argument in Medtronic v. Boston Scientific by Prof. La Belle

Patent, ,

Guest Post by Megan M. La Belle, Assistant Professor at Catholic University of America, Columbus School of Law

Yesterday, the Supreme Court heard oral argument in Medtronic v. Boston Scientific, the first patent case of the term.  The issue before the Court is whether the burden of proof in a declaratory judgment action should be on the patent owner to prove infringement or on the accused infringer to prove noninfringement.  Ordinarily, the patent owner bears the burden of proving infringement, and the declaratory posture of a suit does not shift that burden.  In Medtronic, however, the Federal Circuit created an exception for “MedImmune-type” cases since the patent owner cannot counterclaim for infringement.  “Because the declaratory judgment plaintiff is the only party seeking the aid of the court,” the Federal Circuit reasoned, it should bear the burden of proving noninfringement.

Seth Waxman, on behalf of Medtronic, started his argument with the non-controversial proposition that patent law places the burden of proving infringement on the patent owner.  Mr. Waxman went on to argue that the burden should not shift when the infringement question is raised in a declaratory judgment action –  including MedImmune-type suits – because the Declaratory Judgment Act is merely a procedural device that does not alter substantive rights.  For the most part, the justices appeared to agree with Mr. Waxman.  However, a few questions were raised by Chief Justice Roberts, Justice Kagan, and Justice Kennedy about the fairness of allowing an accused infringer to enter into a license and then turn around and sue the patent owner for declaratory relief.  In the Chief Justice’s words: “The idea is you’re moving along with the license, everybody’s happy.  All of a sudden you jump into court.  Why shouldn’t you have the burden as the party who seeks to disturb the status quo?”

Both Mr. Waxman and Curtis Gannon, arguing on behalf of the government as amicus curiae, addressed these questions of potential unfairness to the patent owner.  They asserted that shifting the burden of proof was not the appropriate way to address the problem.  Mr. Waxman suggested, instead, that patent owners could take certain steps to protect themselves, for instance by including specific contractual provisions in the license that contemplate a declaratory judgment action by the licensee.  Mr. Waxman proposed a number of possible license provisions, including one that would increase the royalty rate if the accused infringer brings a declaratory judgment action, or a provision that makes the filing of a declaratory judgment action a breach of the license agreement.  Mr. Gannon agreed with Mr. Waxman, and made one additional point.  He said this problem of potential unfairness to the patent owner – assuming it is a problem – should be addressed by estoppel, not by shifting the burden of proof:

But even if there were some concern about the licensee turning around and challenging the agreement that it had previously made, it seems like the problem there is either that they should be estopped by what they already said in the agreement or Lear [v. Adkins] needs to be extended to keep them from being estopped in that way.  But shifting the burden of proof seems like an odd way to get at solving whatever the quandary there might be.       

The looming question since MedImmune is whether Lear allows patent owners to “license around” this problem as suggested, or whether such provisions undermine Lear’s policy of encouraging patent challenges.  Unfortunately, Medtronic is unlikely to answer that question, so licensing parties will to continue to wonder if these types of provisions are in fact valid and enforceable.

            Arguing on behalf of the patent owner, Mirowski Family Ventures, Arthur Neustadt defended the Federal Circuit’s decision in Medtronic.  Mr. Neustadt contended that the Federal Circuit correctly applied the “default rule,” which allocates the burden of proof to the party seeking relief.  Because Medtronic was the only party seeking relief in this case, Mr. Neustadt reasoned, it should bear the burden of proving noninfringement.  Justice Scalia began the questioning by stating that this default rule generally doesn’t apply to declaratory judgment actions.  So, Justice Scalia asked, “[w]hat’s different here?”  Mr. Neustadt responded that this case is different because the patent owner could not assert a counterclaim for infringement due to the license.  Justice Scalia was not persuaded by that argument because, as he explained, defendants in declaratory judgment actions often cannot counterclaim:

The whole purpose of the declaratory judgment statute is to enable you to sue before the other side has a cause of action against you.  That’s the whole purpose of it.  So – so why should the fact that the other side doesn’t have a counterclaim change anything?  That’s usually the situation.

Following up on this line of questioning, Justice Ginsburg asked whether Mr. Neustadt was saying that the burden of proof should shift in every declaratory judgment action where only one party is seeking relief.  Mr. Neustadt confirmed that that was his position; in his view, the burden shifting rule established in Medtronic should not be limited to patent cases.  This question of how far the Medtronic rule might extend is also explored in an essay I recently published.

            Throughout his argument, Mr. Neustadt made the point that this isn’t a dispute about infringement, it’s a dispute about claim coverage under the license agreement.  In other words, because there’s a license in place, Medtronic cannot be infringing the patent.  The justices seemed to think this was a distinction without a difference, however.  At one point Justice Breyer said: “[Y]ou want to call that a claim coverage.  I would call it no infringement.  Call it what you wish.”  Later in the argument, Justice Kagan disagreed with Mr. Neustadt’s characterization more directly: “You keep on saying it’s a question of claim coverage, but the question of claim coverage, all that is, is part of an infringement analysis.”  

            One issue the Court did not ask many questions about at oral argument was subject matter jurisdiction.  While subject matter jurisdiction was not raised by the parties, an amicus brief filed by Tessera Technologies argued that the case does not arise under the patent laws because it’s really a contractual royalty dispute, not a dispute about patent infringement.  Tessera relied heavily on the Supreme Court’s recent decision in Gunn v. Minton, which concerned the question of jurisdiction over patent malpractice actions.  Yet, at yesterday’s argument, the only question raised on the topic was by Justice Ginsburg who asked the government for its views on subject matter jurisdiction.    Mr. Gannon stated that the government believes this case arises under the patent laws.  He explained that, in declaratory judgment actions, subject matter jurisdiction is determined by considering what claims would be asserted in the hypothetical coercive action brought against Medtronic.  In other words, if Medtronic were to stop paying royalties and breach its license agreement, the patent owner would sue not only for breach of contract, but for patent infringement as well.   Although the Court did not devote much time to subject matter jurisdiction, the issue was discussed at some length at a post-argument discussion hosted yesterday afternoon by the American University Washington College of Law.  It will be interesting to see to what extent the Court addresses this jurisdictional question in its final decision.

A copy of the full transcript is available here.

The Court is expected to issue its decision before the end of June 2014. 

 

Intellect Wireless v. HTC

Patent,

By Jason Rantanen

Intellect Wireless, Inc. v. HTC Corp. (Fed. Cir. 2013) Download 12-1658.Opinion.10-7-2013.1
Panel: Prost, Moore (author), O'Malley

This opinion is notable because it involves one of the rare instances post-Therasense in which the Federal Circuit concludes that inequitable conduct occurred.

This appeal involves two related patents, Patent Nos. 7,266,186 and 7,310,416, which relate to wireless transmission of caller ID information.  During the prosecution of the '186/'416 patent family, Daniel Henderson, the inventor named on the patents, submitted a Rule 131 declaration to overcome a prior art reference.  A Rule 131 declaration is a document in which the inventor asserts that he or she invented the claimed invention prior to the date of a prior art reference cited by the examiner, a process colloquially referred to as "swearing behind."  (The mechanism does not allow applicants to bypass a statutory bar and was eliminated by the AIA.)  Mr. Henderson averred in the declaration that “the claimed invention was actually reduced to practice and was demonstrated at a meeting . . . in July of 1993.”  

When Mr. Henderson's company, Intellect Wireless, sued HTC for patent infringement, it came out that he had not actually reduced the invention to practice as of the date stated in the declaration.  The district court found that the false declaration constituted inequitable conduct under the Therasense framework.  Intellect appealed.

On appeal, the Federal Circuit affirmed, agreeing that both the requirements of materiality and intent were met. 

Materiality: One question left somewhat open after Therasense was the issue of what constituted egregious affirmative conduct.  Here, the court agreed that Mr. Henderson's conduct rose to that level. 

In one of its earliest opinions, the Federal Circuit held that when an applicant files a false declaration, the applicant must "expressly advise the PTO of [the misrepresentation’s] existence, stating specifically wherein it resides." Rohm & Haas Co. v. Crystal Chem. Co., 722 F.2d 1556, 1572 (Fed. Cir. 1983). In addition, "if the misrepresentation is of one or more facts, the PTO [must] be advised what the actual facts are." Id. 

Therasense, the Intellect Wireless panel held, did not modify this law.  "[T]he materiality prong of inequitable conduct is met when an applicant files a false affidavit and fails to cure the misconduct." Slip Op. at 7. 

Here, the original declaration was indisputably false; the only question was whether the subsequent actions by Mr. Henderson's attorney were sufficient to cure the falsity.  The court held that they were not.  While the attorney quickly submitted a revised declaration, that revised declaration failed to correct the falsehoods in the original declaration.  It did not expressly negate the false references to actual reduction in the original declaration, which included statements such as a reference to a "prototype now in the Smithsonian" that suggested a device embodying the claimed invention was actually built at the relevant time.  The panel agreed that "[n]owhere did the declaration openly advise the PTO of Mr. Henderson’s misrepresentations, as our precedent clearly requires," Slip Op. at 6., and "at best, the revised declaration obfuscated the truth."  Id.

Intent: The Federal Circuit also affirmed the district court's finding of intent to deceive.  In addition to the false statements made during prosecution of the '186 and '416 patents, Mr. Henderson also made false statements about actual reduction to practice during the prosecution of other patents in the family.  This pattern of false and misleading statements combined with the submission of a declaration containing fabricated examples of actual reduction to practice in order to overcome a prior art reference was sufficient to establish intent to deceive. 

Samsung Proposes a Patent Pledge to Settle EC FRAND Investigation

Patent,

Guest post by Jorge L. Contreras.  Prof. Contreras is an Associate Professor of Law at American University Washington College of Law.

As part of the global smartphone litigation between Apple and Samsung, the European Commission has been investigating Samsung’s use of injunctive relief to address infringement of standards-essential patents (SEPs).  Last December, the Commission informed Samsung that its attempts to obtain injunctions against Apple based on SEPs covering the European Telecommunications Standardisation Institute's (ETSI) 3G UMTS mobile wireless standard constituted an abuse of dominant position under EU competition law.  One of the key elements in the claim against Samsung was that it sought injunctions after having committed to license its SEPs to implementers of the UMTS standards on fair, reasonable and non-discriminatory (FRAND) terms, a common requirement within the standards-development world. 

Last week the Commission announced  that it has received a preliminary settlement proposal from Samsung.  Under this proposal, Samsung would commit not to seek injunctions in Europe on the basis of SEPs covering a broad range of wireless telecommunications and networking standards (i.e., well beyond the UMTS standard at issue in the Apple case), so long as the alleged infringers agreed to comply with a specified process for determining appropriate FRAND royalty rates.  This process would include good faith negotiations for at least 12 months, followed by arbitration at the International Chamber of Commerce (ICC) or litigation in the English High Court.  Samsung’s commitment with respect to its SEPs would become the most recent in a growing number of public commitments being made voluntarily by patent holders to limit the enforcement of their patents covering standardized technologies.

For those following the smartphone wars, Samsung’s proposal should sound familiar, as it bears a striking resemblance to the terms on which Google settled an investigation by the U.S. Federal Trade Commission this summer.  The FTC’s investigation of Google’s subsidiary Motorola Mobility also focused on the use of SEPs to seek injunctive relief against implementers of industry standards, and was based on the potential anticompetitive impact of this behavior.  There are, however, several notable differences between the FTC’s Google settlement and what Samsung has proposed.  Some of these are summarized in Table 1 below:

Table 1

Comparison of Google and Samsung (Proposed) Injunction Settlement Terms

 

FTC-Google Order (Jul. 23, 2013)

Samsung Proposal to EC (Oct. 17, 2013)

 

 

 

Scope of Non-injunction commitment

Worldwide

European Economic Area (EEA)

Duration of Commitment

10 years

5 years

Standards covered

Any standard published by a standards-setting organization (SSO)

Mobile Device* standards published by SSOs

Mandatory negotiation period

6 months

12 months

Designated arbitral tribunals

AAA, JAMS, WIPO

ICC

Designated courts

Any tribunal worldwide

English High Court or EU Unified Patent Court

* Mobile devices include smartphones and tablet devices but exclude desktop, notebook, subnotebook and laptop computers.

As Table 1 indicates, Samsung’s proposal is (not surprisingly) a bit less burdensome than the terms that Google agreed with the FTC.  To wit, the proposed geographic coverage is narrower (the EEA rather than the whole world) and the duration is half as long (5 rather than 10 years).  Interestingly, however, Samsung has proposed a mandatory negotiation period, during with it would be required to negotiate FRAND terms with a potential licensee, that is twice as long as the period agreed by Google (12 versus 6 months).  As patent holders typically want to get to court as quickly as possible, it is not clear why Samsung has proposed a longer period, and this may simply be a function of private signaling made by the Commission.  Samsung’s choice of arbitral tribunals is also interesting, inasmuch as it designates the private International Chamber of Commerce (ICC) over the UN-chartered World Intellectual Property Organization (WIPO), which has actively been seeking to get into the SEP arbitration business.

Just as the FTC did prior to finalization of the Google settlement, the EC has solicited public comments on the proposed Samsung settlement.  The FTC received 25 submissions in response to its solicitation, and made several adjustments to the final Google order as a result.  The EC has allowed 30 days for the submission of comments (through Nov. 16, 2013) and it is likely that many of the same issues that were raised in the comments to the FTC will surface again.

For those who are generally interested in voluntary patent pledges like the one proposed by Samsung, the Program on Information Justice and Intellectual Property (PIJIP) at American University’s Washington College of Law has established a new public web resource listing and describing non-SDO patent commitments.  The site, which was launched last week, already includes 63 different non-SDO patent commitments covering thousands of patents.  These pledges have been made by industry leaders such as Google, Microsoft, Apple and Intel, as well as small entities and, should its proposal to the EC be accepted, Samsung.  We hope to continue to add information to this site, and invite the submission of additional non-SDO patent commitments by the public.

PTO Post-Issuance Filings

Patent, , , ,

By Jason Rantanen

This afternoon my frequent collaborator Lee Petherbridge will be presenting Unenforceability (which we wrote with Polk Wagner) at the Houston Intellectual Property Law Association's annual IP Institute.  As we were talking about the presentation, our conversation turned to the subject of the AIA's impact on post-grant proceedings at the PTO (particularly supplemental examination).  I was able to assemble the following charts based on data from the PTO's website (specifically, from this page and this page).

Ex Parte ReexamInter Partes
Note that the inter partes review data points are my estimates based on graphical data from the PTO; practically speaking, however, any deviations from the "true" values are going to barely show up here due the scale of this graph. 

Unsurprisingly, there was a large jump in both ex parte and inter partes filings in Q4 of 2012.  These spikes corresponded with the approximately 5-fold fee increase for filing an ex parte reexamination request, and the transition to inter partes review coupled with a similarly high fee structure on September 16, 2012.  Since then, ex parte reexamination requests have remained low while inter partes review filings have been on the rise, eclipsing even pre-September 16 inter partes reexamination levels (for just the first two months of Q4 of FY 2013, there have already been more than 130, which constitutes more inter partes filings than any previous 3-month quarter except for Q4 2012). 

What about supplemental examination requests?  In the past I've expressed skepticism that supplemental examination will be a widely used mechanism.  To date, the actual filing data appears to have born that skepticism out: the PTO's supplemental examination final rules predicted about 1,430 requests anually; as of August 30, 2013 there were 40. 

 

Monthly_se20130830

Source: http://www.uspto.gov/aia_implementation/statistics.jsp

 

What surprised me the most about this data is that supplemental examination was widely believed to be the new path to ex parte reexamination for patent owners (i.e.: rather than file an ex parte reexamination request, just file a supplemental examination request), including by the PTO itself.  See 77 Fed. Reg. 48828, 48847 (Aug. 14, 2012) ("In view of the benefits to patent owners afforded by supplemental examination under 35 U.S.C. 257(c), the Office is estimating that all 110 requests for ex parte reexamination that would have been filed annually by patent owners will instead be filed as requests for supplemental examination.").  So  far, however, traditional ex parte reexamination requests are an order of magnitude greater than supplemental examination filings.  Of course, this can all change with time – inter partes post grant proceedings started off slow but now have eclipsed ex parte reexamination.

One last chart, again from the PTO's website: pre-issuance submissions are becoming a relatively common, although by no means ubiquitous, type of filing. 

 

Monthly_preissuance20130830a

Source: http://www.uspto.gov/aia_implementation/statistics.jsp

  

Trends in Inequitable Conduct

Patent, ,

By Jason Rantanen

Last fall, I presented a set of data on inequitable conduct pleadings at the America Invents Act: One Year Later conference at the Indiana University Mauer School of Law. That data revealed two significant findings: first, that the rate at which inequitable conduct pleadings rose between 2000-2008 was much slower than previously believed (and never came close to the alleged 80% of all patent cases) and second, that since 2008 the rate at which inequitable conduct is pled has fallen substantially.  The results of that study have since been published in IP Theory; you can read the relatively short article here: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2266041.

Since the article only included data up to the end of 2012, however, I thought it would be useful to update it to include 2013 data.  The below chart compares the number of patent cases in which an Answer was filed to the number of patent cases in which an Answer was filed containing the term "inequitable conduct" for each year based on searches performed in LexMachina.  The 2013 data is as of 9/18/2013.

 Inequitable Conduct Chart

This chart indicates that the rate at which inequitable conduct is being pled continues to decline (at least measured through this crude metric), although it may have reached a plateau.  I've also generated a similar chart that shows Answers containing "inequitable conduct" as a percentage of all "Answers" in patent cases that are searchable using LexMachina; it shows a similar pattern.  

(more…)

Oral Argument Recap: Lighting Ballast Control v. Philips

Patent, , , , ,

Guest Post by Jonas Anderson, Assistant Professor at American University, Washington College of Law.

This morning, the Federal Circuit sat en banc in the case of Lighting Ballast Control v. Philips.  The case is the latest and most significant challenge to the court’s de novo standard of review in claim construction cases.  In taking the case en banc, the Federal Circuit asked the parties to brief three questions:

  • Should the Federal Circuit overrule Cybor Corp. v. FAS Techs. Inc., 138 F.3d 1448 (Fed. Cir. 1998) (in which the Federal Circuit held that “as a purely legal question, we review claim construction de novo on appeal including any allegedly fact-based questions relating to claim construction.”)?
  • Should the Federal Circuit afford deference to any aspect of a district court’s claim interpretation?
  • If so, which aspects should be afforded deference?

Both parties in this case agree that de novo review is not the appropriate standard of review for all aspects of claim construction.  The parties’ positions differ, however, as to the proper scope of appellate deference: Lighting Ballast argues that the court should completely abandon its practice of de novo review and afford deference to all aspects of claim construction decisions; Universal Lighting Technologies (the appellee), on the other hand, argues that deference is appropriate only in resolving “disputed issues of historical fact.”  The PTO echoes ULT’s stance.  In a recent paper forthcoming in the Northwestern University Law Review co-authored with Professor Peter Menell of Berkeley Law School, we argue that de novo review has already been replaced at the Federal Circuit with a more deferential standard, albeit informally.  We find evidence for out theory in the significant drop in reversal rate that has occurred over the past decade: from a high of 44% of terms in 2004 to 20% reversed in 2011.

Despite both parties arguing that Cybor should be modified to some degree and numerous Federal Circuit judges having expressed that belief in prior cases, the tone of the arguments today was certainly one of skepticism.  The three main topics addressed:

National Uniformity Concerns -  Judge Lourie’s initial question was whether deference would disrupt the national uniformity of patent law that the Federal Circuit was designed to achieve.  ULT admitted that the possibility of non-uniform claim construction decisions would be a negative outcome of overruling Cybor, but FRCP 52(a) is in tension with a pure de novo review of claim construction.  The acting Solicitor of the PTO, Nathan Kelley, closed his argument by addressing the non-uniformity concern.  Kelley argued that any non-uniformity that occurred in light of a lowered deference standard would be a benefit to the public because it would result in reduced patent scope in some parts of the country.  While that is obviously not ideal, Kelley’s point was that the concern should not be an overriding one for the court since any non-uniformity is a benefit, not a burden, to the public. 

Line-drawing Problems between Issues of Fact and Issues of Law – The issue that perhaps most captivated the Judge’s attention was whether a deferential standard was workable.  Judge Moore, perhaps one of the court’s most vocal critics of Cybor, was clearly troubled with the solution offered by ULT and the PTO.  She asked for a precise definition of a “historical fact” no less than three times, and never received an answer that satisfied her.  Because claim construction is ultimately an effort to decipher the meaning that a PHOSITA would ascribe to a claim term, she feared that every claim construction decision (other than when the patentee acts as his own lexicographer) would be considered a question of fact.  Despite the PTO and appellee’s repeated assurances that their preferred level of deference would amount to no more than a “small change” in the law, Judge Moore and others (including Judge Dyk, Lourie, and Reyna) seemed troubled by the potential implications of the change.  Judge Lourie asked whether every case would now involve litigants attempting to frame legal determinations as factual determinations.

The Impact of Stare Decisis – This issue, pursued extensively by Judge Taranto, seemed to take the litigants by surprise.  Judge Taranto repeatedly asked about the court’s ability to revisit a clearly established en banc precedent with no intervening Supreme Court case or other change in the law.  Neither side seemed to have a ready answer to his question.

Judge O’Malley, who was on the original panel decision, played a pivotal role in the argument, attempting to clarify the position of the PTO and ULT.  She interpreted their position as one in which a district court judge’s decision as to the historical meaning of a claim that was based on extrinsic evidence would be given deference, but if that interpretation runs counter to the Federal Circuit’s de novo review of the intrinsic evidence the district court’s decision would not impact the case.  This middle position was clearly not satisfactory to a number of judges.  In light of the skepticism, ULT’s counsel essentially backed away from his position that Cybor should be modified; on rebuttal he suggested that the court may well not want to modify Cybor. 

Ultimately, it will be interesting to see if the court decides to maintain the de novo standard or tries to find a way to disentangle factual issues from legal ones.  As a skeptical Judge Dyk quipped about the latter option, “let’s just experiment and see how difficult it would be.”  I sense that some on the court would like to make those distinctions (Judge O’Malley in particular), but I’m unsure whether enough votes exist to make the change.  I don’t think the court will gravitate to Lighting Ballast’s position of a pure legal error standard.  Characterizing all claim construction decisions as factual seems too radical of a departure to the court. Judge Lourie appeared taken aback when Lighting Ballast’s counsel suggested that the specification should be treated as parole evidence: “That is an extraordinary argument.”  Indeed, switching from de novo review to complete deference to all district court claim construction decisions appears, at this stage, very unlikely.

Ed.: You can listen to the oral argument here.

High Point v. Buyer’s Direct – Tell me more, tell me more (about design patents and § 103)

Patent, , , , ,

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

High Point Design LLC v. Buyer’s Direct, Inc. (Fed. Cir. Sept. 11, 2013) Download High Point v Buyers Direct
Panel:  Schall (author), O’Malley, Wallach

High Point Design LLC (“High Point”) and Buyer’s Direct, Inc. (“BDI”) both manufacture fuzzy slipper-socks. In this case, BDI accused High Point of infringing U.S. Des. Patent No. D598,183 (the “D’183 patent”). In May, the district court granted summary judgment in favor of High Point, concluding that the patented design was invalid as obvious and as functional. It also dismissed BDI’s trade dress claim.

The most interesting parts of this decision deal with the issue of obviousness. In the design patent context, the § 103 analysis has two steps. First, the court must identify a proper primary reference—i.e., a “something in existence” that has “basically the same” appearance as the claimed design. Second, other references can be used (assuming certain conditions are met) to modify the primary reference “to create a design that has the same overall visual appearance of the claimed design.”

In High Point, the district court identified two Woolrich slippers, the “Penta” and the “Laurel Hill,” as primary references. In particular, the district court found that the Penta slipper “looks indistinguishable” from the claimed design and that the Laurel Hill slipper had some “insubstantial” differences but “nonetheless has the precise look that an ordinary observer would think of as a physical embodiment” of the claimed design. The district court did not, however, include any images of these designs. For your reference, however, here is a chart comparing the Penta slipper to some of the drawings from the D’183 patent: 

High Point

On appeal, the Federal Circuit decided that the district court erred in its primary reference analysis in a number of ways. According to the Federal Circuit, the district court “erred by failing to translate the design . . . into a verbal description.” On this point, the court relied on its 1996 decision in Durling v. Spectrum Furniture Co., Inc. In Durling, the court divided the first step of the § 103 analysis (i.e., the determination of whether there is a proper primary reference) into two parts, instructing district courts to: “(1) discern the correct visual impression created by the patented design as a whole; and (2) determine whether there is a single reference that creates ‘basically the same’ visual impression.” According to the Federal Circuit, the district court’s analysis in High Point failed to satisfy both of these requirements.

As to the “first part of the first step”—i.e., “discern[ing] the correct visual impression”—the Federal Circuit noted that, under Durling, “the trial court must first translate [the design patent’s] visual descriptions into words,” so that “the parties and appellate courts can discern the internal reasoning employed by the trial court to reach its decision as to whether or not a prior art design is basically the same as the claimed design.”[1] The Federal Circuit found the district court’s description of the D’183 patent to be insufficient because it described the claimed design at “too high a level of abstraction.” So it reversed and remanded on the issue of obviousness, instructing the district court to “add sufficient detail to its verbal description of the claimed design to evoke a visual image consonant with that design.” The Federal Circuit did not, however, explain how much detail would be “sufficient” to meet this evocation standard.

This part of the opinion may seem strange in light of the 2008 en banc decision in Egyptian Goddess, Inc. v. Swisa, Inc., in which the Federal Circuit cautioned district courts against “attempt[ing] to ‘construe’ a design patent claim by providing a detailed verbal description of the claimed design.” In Egyptian Goddess, the Federal Circuit did attempt to distinguish Durling, stating in a footnote that “[r]equiring such an explanation of a legal ruling as to invalidity is quite different from requiring an elaborate verbal claim construction to guide the finder of fact in conducting the infringement inquiry.” Whether that distinction is persuasive is an issue for another day.

As to the second part—i.e., determining whether there is a reference with “basically the same” impression—the Federal Circuit concluded that the district court failed to adequately explain its reasoning. It stated that, on remand, “the district court should do a side-by-side comparison of the [potential primary reference and the claimed design] to determine if they create the same visual impression.”

The Federal Circuit identified a number of other errors in the district court’s § 103 analysis, including its use of an “ordinary observer” standard. The Federal Circuit reiterated that “the obviousness of a design patent must . . . be assessed from the viewpoint of an ordinary designer,” notwithstanding some unfortunate dicta (my characterization, not the court’s) in the 2009 case of Seaway Trading Corp. v. Walgreens Corp.

However, despite all of its criticisms of the district court’s analysis, the Federal Circuit did not say that the district court’s conclusion was wrong. Indeed, the Federal Circuit expressly refused to take a position on the ultimate issue of whether the D’183 patent was obvious. And the Federal Circuit did not say that the Penta or the Laurel Hill slippers could not qualify as primary references. So it will be very interesting to see what happens on remand.

Wawrzynski v. H.J. Heinz Company: CAFC Jurisdiction and Preemption of State Law Claims

Patent,

By Jason Rantanen

The primary issue in this case is whether the Federal Circuit has subject matter jurisdiction over the appeal.  On that issue, the court's analysis of the arguments presented by the parties is solid.  However, in addition to concluding that it lacks jurisdiction, the panel seemingly also rules on a substantive issue in the appeal: whether patent law preempts the plaintiff's state law claims for unjust enrichment and breach of implied contract based on its alleged use (without payment) of the plaintiff's creative ideas.  Without engaging in any substantive analysis, the court concludes that "nothing in federal patent law now stands in the way of Mr. Wawrzynski pursuing his state law claims," a result that is – at least based on the court's minimal discussion of the issue – difficult to reconcile with substantial Supreme Court precedent on the subject.

Wawrzynski v. H.J. Heinz Company (Fed. Cir. 2013) Download Wawrzynski v Heinz
Panel: Newman, Plager (author), Prost 

David Wawrzynski is an entrepreneur who owns his own food delivery company.  During the 1990's, he developed a method for dipping and wiping an article of food, such as a French fry, in a specially configured condiment package.  In 1997, the patent office granted him a patent, No. 5,676,990, for a "Method of Food Article Dipping and Wiping in a Condiment Container."  The sole drawing in that patent is below.

990 patentIn 2008, Wawrzynski sent a letter to the Heinz Company presenting his condiment packaging ideas (including his "Little Dipper" concept) and soliciting a meeting.  He included promotional materials that depicted a condiment package similar to the container depicted in the '990 patent and stated that the features of the "Little Dipper" were subject to his patent.  Heinz invited Wawarzynski to meet with his representatives to present his product ideas, which he did.  At that meeting, Wawrzwynski contends that he shared the idea of creating a "dual function" product that permitted a customer to either dip a food article or squeeze out the condiment.  Following the meeting, Heinz indicated that it was not interested in Wawrzynski's product ideas and did not wish to receive additional information from him.

A few months later, Heinz released its new "DIP & SQUEEZE" packet.  In a surprising coincidence, my wife happened to bring a couple of these items home on Friday so I took the following picture:

Heinz

On October 5, 2010, Wawrzynski filed a lawsuit against Heinz in Michigan state court. (Heinz removed on the basis of diversity jurisdiction.)  Wawrzynski's amended complaint contains two legal claims: breach of an implied contract and unjust enrichment based on Heinz's alleged use of Wawrzynski's ideas for condiment packaging.  The general allegations also reference the '990 patent. 

The case was subsequently transferred to the Western District of Pennsylvania and Heinz filed an answer and counterclaim alleging that it did not infringe the Wawrzynksi patent and that the patent was invalid.  Wawrzynski answered the counterclaim stating, among other things, that "Mr. Wawrzynski avers that there is no case in controversy regarding the ‘990 Patent because he admits that Heinz is not infringing on it."  He also provided Heinz with a covenant not to sue on the '990 patent.

During the district court proceedings, Wawrzynski filed a motion to dismiss Heinz's counterclaim and Heinz filed a motion for summary judgment on the ground that Wawrzynksi's non-patent claims were preempted by federal patent law.  The district court denied Wawrtzynski's motion, concluding that "Wawrzynski's admission and covenant were "manufactured" and did not change the fact that Wawrzysnki's complaint made allegations based upon the '990 patent."  Slip Op. at 5, quoting district court.  The court also granted Heinz's motion for summary judgment.  Wawrzynski appealed the district court's rulings.

No Jurisdiction: Under the Federal Circuit's jurisdictional statute, 28 U.S.C. § 1295, if the case arises under the Federal patent laws, the court has jurisdiction; if the case is one purely of state law claims, not involving a patent issue, it does not.  Although both parties contended that the Federal Circuit had jurisdiction, the court concluded that it did not.  Wawrzynski argued that the post-AIA version of Section 1295 applied.  Under this version of Section 1295, the court has jurisdiction over appeals in actions "in which a party has asserted a compulsory counterclaim arising under any Act of Congress relating to patents." However, the newer version only applies to actions commenced on or after September 16, 2011 and this action commenced before that date.  Nor did the date of Heinz's counterclaim (September 28, 2011) count; the AIA speaks in terms of the date the action commences.

The Federal Circuit also rejected Heinz's jurisdictional argument.  Heinz argued that Wawrzynski's complaint did, in fact, assert a claim of patent infringement.  But this was not the case.  First, under the "well-pleaded complaint rule," the plaintiff is the master of the complaint and can "eschew[] claims based on federal law [and] choose to have the cause heard in state court."  Slip Op. at 10, quoting Caterpillar Inc. v. Williams, 482 U.S. 386, 398-99 (1987).  Here, Wawrzynski's complaint raised only two causes of action, both based on state law.  Although it referenced the patent, "[t]he complaint does not have a count for patent infringement or anything similar."  Slip Op. at 10.  Ultimately, the court concluded that the "sparse background discussion of the patent does not make a well-pleaded complaint for patent infringement." Slip Op. at 12.  Based on this, the court ordered the appeal transferred to the Third Circuit.

The Preemption Puzzle: Despite concluding that it lacked jurisdiction, the panel nevertheless went on to apparently rule on the issue of preemption, or at least make clear its opinon on the subject.  I find the following three paragraphs particularly puzzling.  The court seems to hold that there is no preemption in a highly summary fashion:

We note that some of the issues underlying our jurisdictional analyses also underlie the district court's summary judgment merits analyses. To fully assess the question of our jurisdiction, we necessarily have analyzed and decided certain of these issues.
For example, we have concluded that the relief requested in the complaint aligns with state law claims and not a claim for patent infringement. We also found support for Mr. Wawrzynski's contention that certain of the ideas and materials he allegedly provided to Heinz are not found in his patent. These conclusions, along with our overarching conclusion that the complaint does not present a well-pleaded patent law issue, undercut conclusions relied upon by the district court to support its grant of summary judgment of preemption. Accordingly, it appears that nothing in federal patent law now stands in the way of Mr. Wawrzynski pursuing his state law claims.

With regard to the district court's finding of non-infringement of the ′990 patent by Heinz's ‘Dip & Squeeze®’ packet, Mr. Wawrzynski's responsive pleadings contain both a concession that Heinz's product does not infringe and a covenant not to sue. Thus, it would appear that in any event there is no case or controversy remaining to support a subsequent judgment on the issue of infringement.

Slip Op. at 13 (emphasis added).  Notwithstanding the court's rather cursory dismissal, however, patent law preemption of state law claims involving ideas and other intangibles is a  complex and challenging analysis (as my unfair competition students have learned over the past two weeks).  The central Supreme Court precedent is well known: Sears v. Stiffel, Bonito Boats v. Thunder Craft Boats, Kewanee Oil v. Bicron, and the circuits have struggled with issues of preemption for decades.  While it is conceivable that some of Wawrzynski's claims are not preempted by patent law, it seems at least equally plausible that many of them are.  Given the complexity and importance of this issue, it is surprising that the panel did not choose to either let the Third Circuit address the issue or analyze the issue itself in meaingful detail if it believed it was necessary to satisfy the approach described in Gunn v. Minton (which the opinion does not mention). 

Surprise! The Law of Subject Matter Eligibility Remains Unsettled

Patent, , , , ,

By Jason Rantanen

Accenture Global Services, GMBH v. Guidewire Software, Inc. (Fed. Cir. 2013) Download Accenture v. Guidewire
Panel: Rader (dissenting), Lourie (author), Reyna

It is difficult to think of an issue that has more deeply divided the Federal Circuit over the past few years than subject matter eligibility.  Accenture is the latest barrage and counter-barrage in this seemingly endless war.  Unlike Ultramercial v. Hulu, though, in which Judge Rader wrote the majority opinion and Judge Lourie concurred in the result, the forces arguing against subject matter eligibility of computer programs won today's battle. 

At issue in the case were claims 1-7 and 8-22 of Patent No. 7,013,284.  Claim 1 read:

A system for generating tasks to be performed in an insurance organization, the system comprising:

an insurance transaction database for storing information related to an insurance transaction, the insurance transaction database comprising a claim folder containing the information related to the insurance transaction decomposed into a plurality of levels from the group comprising a policy level, a claim level, a participant level and a line level, wherein the plurality of levels reflects a policy, the information related to the insurance transaction, claimants and an insured person in a structured
format;

a task library database for storing rules for determining tasks to be completed upon an occurrence of an event;

a client component in communication with the insurance transaction database configured for providing information relating to the insurance transaction, said client component enabling access by an assigned claim handler to a plurality of tasks that achieve an insurance related goal upon completion; and

a server component in communication with the client component, the transaction database and the task library database, the server component including an event processor, a task engine and a task assistant;

wherein the event processor is triggered by application events associated with a change in the information, and sends an event trigger to the task engine; wherein in response to the event trigger, the task engine identifies rules in the task library database associated with the event and applies the information to the identified rules to determine the tasks to be completed, and populates on a task assistant the determined tasks to be completed, wherein the task assistant transmits the determined tasks to the client component.

The district court (Judge Robinson, one of the ) held claims 1-7 (system claims) and claims 8-22 (method claims) invalid under 35 U.S.C. § 101.  Accenture appealed only claims 1-7. 

System Claims Ineligible Subject Matter: In an opinion authored by Judge Lourie, the majority agreed with the district court that the claims were patent ineligible subject matter.  The majority provided two bases for its conclusion.  First, "because the system claims offer no meaningful limitations beyond the method claims that have been held patent-ineligible" and second, "because, when considered on their own, under Mayo and our plurality opinion in CLS Bank, they fail to pass muster." Slip Op. at 10.

The majority first compared the system claims to the method claims that were conclusively invalid because Accenture failed to appeal them.  Relying on the plurality opinion in CLS Bank v. Alice, the majority concluded that the proper approach is to "compare the substantive limitations of the method claim and the system claim to see if the system claim offers a “meaningful limitation” to the abstract method claim, which has already been adjudicated to be patent-ineligible."  Id. Because the court found no additional "meaningful limitation" in the system claims, they were as patent ineligible as the method claims. 

The majority also concluded that the method claims were invalid under Section 101 even standing on their own.  Applying a preemption analysis to the abstract idea at the heart of the system claims, the majority concluded that the additional imitations did not "narrow, confine, or otherwise tie down the claim so that, in practical terms, it does not cover the full abstract idea itself."  Slip Op. at 15.  Furthermore, "simply implementing an abstract concept on a computer, without meaningful limtiations to that concept, does not transform a patent ineligible claim into a patent-eligible one."  Id.

Judge Rader's Dissent: Unsurprisingly, Judge Rader disagreed with the majority.  Central to his disagreement was the belief that the plurality framework relied upon by the majority in this case lacks precedential value.  "[N]o part of CLS Bank, including the plurality opinion, carries the weight of precedent.  The court's focus should be on Supreme Court precedent and precedent from this court."  Slip Op. at 20.  He also disagreed with the basic idea of the comparing the system claims to the invalid method claims, characterizing it as estoppel that will have the effect of "requiring litigants to appeal the invalidity of every claim or else risk the potential for estoppel or waiver of other claims."  Id. And Judge Rader would have concluded that, even on the merits, the claimed systems present patent-eligible subject matter.  "The claims offer “significantly more”  than the purported abstract idea, …, and meaningfully limit the claims’ scope."  Id. at 4, quoting Mayo v. Prometheus, 132 S.Ct. 1289, 1293 (2012).

Judge Rader also once again proclaims his view that the courts' approach to patent law's subject matter eligibility requirement is pure folly:

In conclusion, I note that prior to granting en banc review in CLS Bank, this court commented: “no one understands what makes an idea abstract.” CLS Bank Int’l v. Alice Corp., 685 F.3d 1341, 1349 (Fed. Cir. 2012), opinion vacated, 484 F. App’x 559 (Fed. Cir. 2012) (internal quotations marks omitted). After CLS Bank, nothing has changed. “Our opinions spend page after page revisiting our cases and those of the Supreme Court, and still we continue to disagree vigorously over what is or is not patentable subject matter.” MySpace, Inc. v. GraphOn Corp., 672 F.3d 1250, 1259 (Fed. Cir. 2012); see generally CLS Bank. Indeed, deciding what makes an idea “abstract” is “reminiscent of the oenologists trying to describe a new wine.” MySpace, 672 F.3d at 1259.

I take this opportunity to reiterate my view that “the remedy is the same: consult the statute!” CLS Bank, 717 F.3d at 1335 (additional reflections of Rader, C.J.). The statute offers broad categories of patent-eligible subject matter. The “ineligible” subject matter in these system claims is a further testament to the perversity of a standard without rules—the result of abandoning the statute.

Slip Op. at 23.  That said, Judge Rader's thoughts about indeterminacy should perhaps be taken with a grain of salt: his opinions indicate, after all, that he has very strong views that one side of the subject matter eligibility battle is right and the other wrong.

One other thing of note about this case: Mark Lemley – who has written a great deal about patenting of computer-implemented inventions, including a recent post on PatentlyO – was the lead attorney for the defendant.

Trading Technologies v. Open E Cry: Doctrinal Formalism in Patent Law

Patent, ,

By Jason Rantanen

Trading Technologies International, Inc. v. Open E Cry, LLC (Fed. Cir. 2013) Download Trading Tech v Open E Cry
Panel: Lourie (author), Plager, Benson (District Judge)

The traditional – and certainly most widely held – view in patent law is to view its issues as formally distinct doctrines; crystalline pillars supporting the temple.  This view emphasizes the formal distinction between patent law doctrines and rejects attempts to cross between them.  Each doctrine is an independent whole.  Trading Technologies v. Open E Cry exemplifies this view.  (It's worth noting that this opinion notwithstanding, some of the most successful patent litigators that I've met have succeeded by rejecting the formality of doctrines and building their litigation strategy around the intersticial spaces between the doctines.)

Trading Technology ("TT") owns a series of related patents generally pertaining to software for electronic trading on a commodities exchange.  The four patents at issue in this appeal claim priority based on an application that ultimately issued as Patent No. 6,772,132.  In an earlier appeal, Trading Technologies International, Inc. v. eSpeed, Inc., 595 F.3d 1340 (Fed. Cir. 2010), the Federal Circuit considered the correct construction of claims of the '132 patent that required a graphical user interface having a "static" display of market price information.  In eSpeed, the Federal Circuit held that "static," as used in the claims of the ’132 patents, "required a price column that moves only in response to a manual re-centering command."  In reaching this result, eSpeed concluded (among other things) that:

“[t]he inventors’ own specification strongly suggests that the claimed re-centering feature is manual” because the written description “only discusse[d] manual re-centering commands” and referred to “the present invention” as including a manual one-click re-centering feature.

While the earlier litigation was pending, TT filed the applications that matured into the patents involved in this suit. In those applications, TT introduced new claims that lacked the term "static" in any form.  As a result, three of the new patents had identical written descriptions to the '132 patent but claims that differed in one key way: they did not include "static" limitations.  (In the fourth patent TT pursued the strategy of filing a continuation-in-part; the result was that TT was able to add new disclosures). 

TT filed multiple actions based on this second round of patents. The district court consolidated the actions and subsequently grand summary judgment of invalidity of the four  new patents based on lack of adequate written description under 35 U.S.C. § 112(a).  The district court based its ruling on the earlier eSpeed opinion, concluding that eSpeed required holding the claims invalid for lack of written description. The Federal Circuit summarized the district court's action as follows:

According to the district court, eSpeed’s construction of “static” in the ’132 and ’304 patents turned “on the premise that the invention described in the specification was limited to static price axes that move only with manual re-centering.” Id. at 1045. Because the ’411 patent’s claims lacked that term and therefore appeared to cover displays with automatic re-centering, the district court concluded that any decision upholding those broader claims as supported by the same written description “would be at odds with the Federal Circuit’s binding findings in the eSpeed Decision.” Id. In granting the Defendants’ motion for summary judgment, the district court expressly declined to evaluate the parties’ evidence or make its own findings on the merits because the court determined “as a matter of law that the eSpeed Decision controls.”

Slip Op. at 12.  On appeal, the Federal Circuit rejected this reasoning, reversing the grant of summary judgment and remanding for further proceedings.  The court based its conclusion on the formal distinction between the doctrines of claim construction and written description, a distinction that it explained in detail:

Despite their similarities, however, claim construction and the written description requirement are separate issues that serve distinct purposes.

In construing claims, a court seeks to discern the meaning of a particular term used in one or more claims of a patent, based, inter alia, on evidence drawn from the specification, the surrounding claim language, the prosecution history, and relevant extrinsic sources….While guided by the specification, the focus of claim construction remains on defining a discrete claim term to better ascertain the boundaries of a claim. In contrast, the written description analysis considers the bounds of the specification itself. The written description requirement prevents patentees from claiming more than they have actually invented and disclosed to the public, as measured by the written description of the invention provided with their patent applications.

This case illustrates the distinction. In eSpeed, we were called upon to evaluate the proper construction of “static,” a term used in the claims of the ’132 and ’304 patents. Accordingly, we considered the evidence relevant to a proper reading of that term, starting with those patents’ common written description. eSpeed, 595 F.3d at 1353–55. Noting that the patents referred to one-click centering as part of the invention and did not discuss automatic re-centering, we concluded that the specification “strongly suggests” that a “static” price column would require manual re-centering. Id. at 1353–54. And even though the patents described price columns that “do not normally change positions unless a re-centering command is received,” ’132 patent col. 7 ll. 46–48 (emphasis added), we concluded that “the inventors jettisoned the word ‘normally’ during prosecution” by limiting the term “static” in response to an indefiniteness rejection, eSpeed, 595 F.3d at 1354. In sum, we concluded that the disputed claim term should be limited to require a manual re- centering command in the claims of the ’132 and ’304 patents.

But our decision in eSpeed did not thereby determine whether the same written description would also support different claims drawn to a non-“static” display. In particular, we did not make “findings regarding the specification . . . that are dispositive” as to the present written description challenge. See Summary Judgment Order, 852 F. Supp. 2d at 1044. On the contrary, we merely determined the best construction for a single disputed claim term, a term that is absent from the claims of the ’411, ’768, and ’374 patents now before us. That analysis did not require us to pass on the outer limits of the pa- tents’ written description, nor did we endeavor to do so. In fact, our prior examination of that written description did not even settle the limited claim construction issue then facing the court, see eSpeed, 595 F.3d at 1353–54 (concluding that the specification “strongly suggests” that the claimed re-centering feature is manual), much less conclusively find that the same written description could never support any claim to a display with a non-“static” price axis.

Slip Op. at 17-18.

Prosecution History Estoppel: The court also reversed grant of summary judgment of prosecution history estoppel, concluding that statements made in connection with the earlier '132 patent did not extend through to the subsequent patents in the same lineage in this case.  "Prosecution history estoppel can extend from a parent application to subsequent patents in the same lineage, Elkay, 192 F.3d at 981, as can a prosecution disclaimer, Omega Eng’g, 334 F.3d at 1333–34. But “arguments made in a related application do not automatically apply to different claims in a separate application.” Biogen, Inc. v. Berlex Labs., Inc., 318 F.3d 1132, 1139 (Fed. Cir. 2003)….In this case, the intrinsic record specific to the ’055 patent distinguishes eSpeed and compels a different result." Slip Op. at 24.

Disclosure: Several years ago, Dennis represented Trading Technologies in a previous case at the District Court level. That said, we haven't talked about the substance of these cases.

SkinMedica v. Histogen

Patent, , , ,

By Jason Rantanen

SkinMedica Inc. v. Histogen Inc. (Fed. Cir. 2013) Download SkinMedica v Histogen
Panel: Rader (dissenting), Clevenger, Prost (author)

SkinMedica owns Patents No. 6,372,494 and 7,118,746, which relate to methods for producing pharmaceutical compositions containing "novel conditioned cell culture medium compositions,…[and] uses for the[m]."  A conditioned cell culture medium is an artificial environment that supplies the components necessary to meet the nutritional needs of the growing cells.  The conditioned medium at issue here also included extracellular proteins that, according to the patentees, may be useful for treating skin conditions such as wrinkles, frown lines, etc. 

The written descriptions of the '494 and '746 patents explain that a novel and important aspect of their invention is the difference between growing cells in two-dimensions and growing cells in three-dimensions. 

Claim 1 of the '494 patent:

1. A method of making a composition comprising:

(a) culturing fibroblast cells in three-dimensions in a cell culture medium sufficient to meet the nutritional needs required to grow the cells in vitro until the cell culture medium contains a desired level of extracellular products so that a conditioned medium is formed;

(b) removing the conditioned medium from the cultured cells; and

(c) combining the conditioned medium with a pharmaceutically acceptable carrier to form the composition.

(emphasis added by court).  At issue was the phrase "culturing…cells in three-dimensions."  The district court construed this phrase to mean "growing…cells in three dimensions (excluding growing in monolayers or on microcarrier beads."  Following claim construction, the district courted summary judgment of noninfringement for Histogen as it was undisputed that Histogen grew its cells on microcarrier beads. 

Limits on Ordinary Meaning: On appeal, the Federal Circuit affirmed the district court's claim construction. The court first agreed with SkinMedica that "the ordinary meaning of “culturing . . . cells in three-dimensions” would reach the use of beads."  However,

If the specification reveals “a special definition given to a claim term by the patentee that differs from the meaning it would otherwise possess[,] . . . the inventor’s lexicography governs.”…. And if the specification reveals “an intentional disclaimer, or disavowal, of claim scope by the inventor,” the scope of the claim, “as expressed in the specification, is regarded as dispositive.”
Slip Op. at 13 (citations omitted).  An  high hurdle applies when dealing with implied rather than express redefinition, as an "implied redefinition must be so clear that it equates to an explicit one."  Id. at 29, quoting Thorner v. Sony Computer, 669 F.3d 1362, 1368 (Fed. Cir. 2012).  Here, according to the majority, the inventors did precisely that for "culturing…cells in three dimenations":

In the written description, the patentees plainly and repeatedly distinguished culturing with beads from culturing in three-dimensions. They expressly defined the use of beads as culturing in two-dimensions. And they avoided anticipatory prior art during prosecution by asserting that the conditioned medium produced by two-dimensional cultures was inferior and chemically distinct from the conditioned medium produced by three-dimensional cultures. Because none of the evidence called to our attention by SkinMedica would reasonably lead to a different reading of the intrinsic evidence, we find that the inventors clearly redefined the scope of “culturing . . . cells in three dimensions” by disclaiming the use of beads—which would otherwise be included in the ordi- nary meaning of that phrase.

Id. at 15.  In support of this conclusion, the majority opinion walks through a lengthy discussion of the text of the specification and prosecution history, addressing language such as "beads, as opposed to cells grown in three dimensions and the use of "i.e."  The result was a disavowal of beads from the scope of the claim term at issue:

"In sum, although the inventors never explicitly redefined three-dimensional cultures to exclude the use of beads, their implicit disclaimer of culturing with beads here was even “so clear that it equates to an explicit one. Without fail, each time the inventors referenced culturing with beads in the specification, they unambiguously distinguished that culture method from culturing in three-dimensions."

Id. at 27. 

Incorporation by Reference: One of SkinMedica's counter arguments was that the written description incorporated a voluminous technical treatise, Cell & Tissue Culture: Laboratory Procedures ("Doyle") in its entirety and that Doyle describes three-dimensional culturing with beads.  Among the majority's bases for rejecting SkinMedica's argument was the lack of any specific reference to Doyle:

Third, even if we assume that the passage from Doyle discusses what one of ordinary skill in the art might understand to be three-dimensional culturing with beads, the inventors’ general citation of Doyle does not indicate any reliance on that particular passage to define “culturing in three-dimensions” and to abandon the otherwise clear disclaimer of beads in the specification. When discussing cell culture methods, the patentees make the following reference to Doyle:

The cells may be cultured in any manner known in the art including in monolayer, beads or in three-dimensions and by any means . . . . Methods of cell and tissue culturing are well known in the art, and are described, for example, in [Doyle], supra; Freshney (1987), Culture of Animal Cells: A Manual of Basic Techniques, infra.

’494 patent col. 10 ll. 2–6.

It is clear from that passage that the inventors did not refer to Doyle in order to define what they meant by “three-dimensional culturing” in their patent. They did not indicate their reference to Doyle was for that purpose; nor did they even refer with any detailed particularity to the passages in Doyle that, according to SkinMedica, may have discussed three-dimensional culturing with beads. When the inventors wanted to use Doyle to explain the potential scope of terms they used, they did so specifically….We see no reason for such a non-specific reference to trump the clear disclaimer in the specification of culturing with beads.

Slip Op. at 35-36. 

Judge Rader's Dissent: Writing in dissent, Judge Rader disagreed that the patentee had met the "heavy presumption" in favor of the ordinary meaning of claim language.  Central to Judge Rader's opinion was the distinction between growing cells "on beads" and growing cells in three-dimensions using beads.  

Deference battle? Judge Rader's dissent also relied on testimony by SkinMedica's technical expert, Dr. Salomon.  The majority agreed with district court's decision to give Dr. Salomon's testimony "no weight"; in Judge Rader's eyes, "Dr. Salomon's testimony, when viewed as a whole, deserves great weight and respect."  Slip Op. at 47. 

The Disappearing Federal Circuit Advisory Council Model Orders

Patent,

By Jason Rantanen

In late July, a model order relating to the number of asserted claims and prior art referenes in patent litigations was released on the Federal Circuit Advisory Council's webpage.  (You can read the PatentlyO post here.)  This new model order followed an earlier order relating to discovery issues in patent litigation that Dennis wrote about in September 2011.  In a surprising development, however, within two days of being released, all content on the Federal Circuit Advisory Council webpage was removed and replace with the message "This site is being updated and will be posted soon."

Recently, the Advisory Council webpage was mostly restored with the exeption of the two model orders.  Instead, the webpage contains the following text:

The Advisory Council published model orders concerning e-discovery and limitations on claims and prior art, and posted a disclaimer that the Court did not approve the model orders.  To avoid the risk of any misperception that the Court has endorsed or taken any position on the model orders through the Advisory Council, or otherwise, the Advisory Council confirms that it does not sponsor or endorse orders.

A linked PDF adds simply:

Model Orders
Model orders concerning e-discovery and limitations on claims and prior art were posted on the court’s website. Those orders have now been removed since the court has not sponsored or endorsed the orders. In light of the court’s determination, the advisory council should not be viewed as having sponsored or endorsed these orders on behalf of the court.

While not speculating on the court's internal reason for taking this action, it's worth noting that there's an interesting tension here between the Federal Circuit's historical mandate to bring uniformity to patent law (a mandate that is usually thought of as applying to substantive patent law but might involve procedural issues unique to patent law) and the statutory basis for the Advisory Council, 28 USC § 2077:

(b) Each court, except the Supreme Court, that is authorized to prescribe rules of the conduct of such court’s business under section 2071 of this title shall appoint an advisory committee for the study of the rules of practice and internal operating procedures of such court and, in the case of an advisory committee appointed by a court of appeals, of the rules of the judicial council of the circuit. The advisory committee shall make recommendations to the court concerning such rules and procedures. Members of the committee shall serve without compensation, but the Director may pay travel and transportation expenses in accordance with section 5703 of title 5.

(emphasis added).  Despite the issues surrounding the creation and distribution of the model orders themselves, they're still useful tools for patent litigators to be aware of and draw from.  The E-Discovery model order formed the basis for an E-Discovery model order adopted in the Eastern District of Texas (albeit with some variation), has been employed in litigation in other districts, and (according to a quick search on Westlaw) has been referenced or quoted in full in over two dozen secondary sources (include a few articles that discuss the order in depth).

Copies of the now withdrawn model orders are available here:

Download Model-order-excess-claims

Download Ediscovery-model-order

Update: Steve Joncus dropped me a note to tell me that the District of Oregon has adopted the E-Discovery model order in its entirety (LR 26-6), available here.

Bits & Bytes from Jonathan Hummel

Patent

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An ongoing story, the editors at Bloomberg report on the effects of President Obama’s granting a reprieve to Apple. ON August 1, Susan Decker and Peter Burrows reported that Apple was seeking a reprieve from President Obama to allow the company to continue selling versions of its iPhone4 and iPad2 in the United States. The reprieve was granted and Bloomberg reports that Samsumg’s market value dropped by over $1 billion.

#2. Google wins Patent Battle over Predetermined “UnLocking” Patterns

Don Reisinger for CNET describes, in a recent report, how Google’s “Alternative Unlocking Patterns” are different from other technologies. “Currently, software allows for different unlocking patterns, but all they do is open up the handset's software. Google's technology would unlock the device and bring people to a certain place within the software.”

#3. Raymond T. Chen Affirmed as Newest Justice on US Court of Appeals for the Federal Circuit

Gene Quinn at IPWatchdog reports on the newest Justice. Justice Chen was formerly the Deputy General Counsel for Intellectual Property Law and Solicitor at the United States Patent and Trademark Office.

#4. Cadbury and Nestle have a Row over KitKat Design

The crunchy confection beloved by chocolate enthusiasts around the world has a dicey future after the IPO ruled the bars distinctive shape could not be trademarked in the UK. James Tozer, reporting for the UK’s Daily Mail Online, explains that a real tricky legal situation arises becauset the distinctive KitKat design is already trademarked at the EU level.

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Bits & Bytes from Jonathan Hummel

Patent

RECENTLY

#1. Obama Grants Reprieve to Apple…and why it matters.

An ongoing story, the editors at Bloomberg report on the
effects of President Obama’s granting a reprieve to Apple. ON August 1, Susan
Decker and Peter Burrows reported
that Apple was seeking a reprieve from President Obama to allow the company to
continue selling versions of its iPhone4 and iPad2 in the United States. The
reprieve was granted and Bloomberg
reports that Samsumg’s market value dropped by over $1 billion.

#2. Google wins Patent Battle over Predetermined
“UnLocking” Patterns

Don
Reisinger for CNET describes, in a recent
report, how Google’s “Alternative Unlocking Patterns” are different from
other technologies. “Currently, software allows for different unlocking
patterns, but all they do is open up the handset's software. Google's
technology would unlock the device and bring people to a certain place within
the software.”

#3. Raymond T. Chen Affirmed as Newest Justice on US
Court of Appeals for the Federal Circuit

Gene
Quinn at IPWatchdog reports
on the newest Justice. Justice Chen was formerly the Deputy General Counsel for
Intellectual Property Law and Solicitor at the United States Patent and
Trademark Office.

#4. Cadbury and Nestle have a Row over KitKat Design

The crunchy confection beloved by chocolate enthusiasts
around the world has a dicey future after the IPO ruled the bars distinctive
shape could not be trademarked in the UK. James
Tozer, reporting for the UK’s Daily Mail Online,
explains that a real
tricky legal situation arises becauset the distinctive KitKat design is
already trademarked at the EU level.

JOBS

Litigation
Associate – Law Firm – Seattle, Wash.

  • Seed IP Law Group, one of the country's
    leading intellectual property law firms, is looking for a litigation
    associate with a minimum of two years of patent litigation experience and
    a degree in chemistry.

Patent
Attorney – Law Firm – Portland, Ore.

  • Marger Johnson McCollom, P.C., a
    Portland, Oregon, full-service IP boutique, seeks a registered patent
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Related articles
Apple succeeds on appeal: dismissed ITC patent case against Google's Motorola Mobility alive again
Protecting Intellectual Property – Law

Rembrandt v. Johnson & Johnson: Expert Reports and Inconsistent Testimony

Patent,

By Jason Rantanen

Rembrandt Vision Technologies, L.P. v. Johnson & Johnson Vision Care, Inc. (Fed. Cir. 2013) Download Rembrandt v J&J
Panel: Dyk, Clevenger, Moore (author)

While this opinion is precedential, it does not contain any major legal prouncements.  It does, however, illustrate the importance of procedural rules in patent litigation.  Here, Rules 26 and 37 of the Federal Rules of Civil Procedure played the pivotal role in the outcome of the infringement suit. 

Rembrandt sued Johnson & Johnson Vision Care (JJVC) for infringement of a patent covering a type of soft gas permeable contact lenses.  At issue during trial was whether JJVC's lenses were "soft" under the parties' agreed upon claim construction ("a contact lens having a Hardness (Shore D) less than five"). To support its position that JJCV's lenses met this limitation, Rembrandt relied on the testimony of its expert witness who allegedly conducted a hardness test using procedures described in his expert report.

While on the stand at trial, however, Rembrandt's expert "suddenly changed course in the middle of cross-examination and testified that he did not follow the procedures listed in his expert report."  Slip Op. at 4-5 (quoting district court).  Instead, he testified that he followed a different procedure that was less susceptible to many of the criticisms that JJVC was leveling at the methodology described in the report.  Based on the inconsistency, the court struck the expert's testimony under FRCP 26 and 37 and, because his testimony was the only evidence that the "soft" limitation was met, granted JMOL in favor of JJVC.

The Federal Circuit affirmed the district court's rulings on appeal.  "Rule 26 requires an expert witness to disclose an expert report that contains “a complete statement of all opinions the witness will express and the basis and reasons for them.” Slip Op. at 7, quoting FRCP 26(a)(2)(B)(i). Furthermore, "[a]n expert witness may not testify to subject matter beyond the scope of the witness’s expert report unless the failure to include that information in the report was “substantially  justified or harmless.” Id. (quoting FRCP 37(c)(1)). 

At issue was whether the expert's failure to comply with the requirements of Rule 26 was "substantially justified or harmless.  The Federal Circuit agreed that it was not substantially justified: 

The court rightly found that “[t]here is simply no excuse for Dr. Beebe waiting until cross-examination to disclose his testing procedures.” JMOL Order, 282 F.R.D. at 664. Dr. Beebe submitted his expert report nearly six months prior to trial. Id. at 663–64; J.A. 96. Leading up to trial, the contents of his expert report were the subject of his deposition and were at issue in the pre-trial briefing, including dispositive motions. JMOL Order, 282 F.R.D. at 663–64. JJVC moved to exclude Dr. Beebe’s testimony on the basis that his Shore D testing did not comply with industry standards. Id. at 658. JJVC also moved for summary judgment on the ground that the testing was not sufficient to raise a genuine issue of material fact as to the Shore D Hardness values of the accused lenses. Id. Nevertheless, even though the adequacy of his Shore D Hardness testing methodology was in dispute prior to trial, Dr. Beebe never attempted to supplement his expert report. As the district court observed, “Dr. Beebe thus apparently either did not review his expert report or forgot how he had actually performed the test.” Id. at 664.

Slip Op. at 8.  Nor was it harmless:

JJVC prepared its noninfringement defense based on the methodology disclosed in Dr. Beebe’s expert report, and opted to challenge that methodology rather than introduce competing expert testimony. JMOL Order, 282 F.R.D. at 664. Nothing during the course of the proceedings alerted JJVC to the possibility that Dr. Beebe would change his testimony. To the contrary, Rembrandt stood behind Dr. Beebe’s expert report at summary judgment and Dr. Beebe testified to the veracity of his report on direct examination. Id. at 657–58. Dr. Beebe even initially defended his testing methodology upon cross-examination. Id. at 658–59. Dr. Beebe only recanted his expert report when, after being “repeatedly challenged on cross-examination,” he was “[u]nable to explain how his written procedures complied with the standards” that govern hardness testing. Id. at 659, 668. While Dr. Beebe characterized the errors in his report as “typo[s],” it is undisputed that the shift in his testimony was both substantive and substantial. Such a late change in course significantly hampered JJVC’s ability to adequately cross-examine Dr. Beebe and denied it the opportunity to develop or introduce competing evidence.

Id. at 8-9.  The expert's testimony was the only evidence that Rembrandt pointed to on the Shore D Hardness requirement.  What about other evidence of the "soft" limitation?  Because Rembrandt agreed to the construction of "soft" as requring the lenses to have a Hardness (Shore D) less than five, JJVC's characterization of its lenses as "soft" was irrelevant.  "Generic statements that the accused lenses are “soft” had the potential to confuse the jury and did not bear on whether the accused lenses had a Shore D Hardness of less than five."  Id. at 10.

Welcome Judge Chen!

Patent

This morning the Senate unanimously confirmed Raymond T. Chen for a seat on the United States Court of Appeals for the Federal Circuit.  Soon-to-be Judge Chen comes to court with extensive experience in patent law including both private practice and governmental service (most recently as the Deputy General Counsel for Intellectual Property Law and Solicitor for the United States Patent and Trademark Office). 

Congratulations Judge Chen!

A brief bio from a February 2013 White House press release:

Raymond T. Chen currently serves as the Deputy General Counsel for Intellectual Property Law and Solicitor for the United States Patent and Trademark Office (USPTO), a position he has held since 2008.

Chen received his B.S. in electrical engineering in 1990 from the University of California, Los Angeles, and his J.D. in 1994 from the New York University School of Law.  After graduating from law school, he joined Knobbe, Martens, Olson & Bear, a boutique intellectual property law firm in Irvine, California, where he prosecuted patents and represented clients in intellectual property litigation.  From 1996 to 1998, Chen served as a Technical Assistant at the United States Court of Appeals for the Federal Circuit, performing the functions of a staff attorney.  At the end of his two-year term, he joined the USPTO as Associate Solicitor and remained in that role until his promotion to Solicitor in 2008.   Since joining the USPTO, Chen has represented the agency in numerous appeals before the Federal Circuit and personally argued over 20 cases, issued guidance to patent examiners to ensure consistency with developing law, advised the agency on legal and policy issues, and helped promulgate regulations.  He has co-chaired the Patent and Trademark Office Committee of the Federal Circuit Bar Association and is a member of the Advisory Council for the United States Court of Appeals for the Federal Circuit.

 

 

Charles Machine Works v. Vermeer Mfg: CAFC continues rolling back the vitiation doctrine

Patent,

By Jason Rantanen

The Charles Machine Works, Inc. v. Vermeer Manufacturing Company (Fed. Cir. 2013)
Panel: Dyk, Mayer, Moore (author)

The Charles Machine Works (CMW) holds U.S. Patent No. 5,490,569, which relates to a two-pipe apparatus for boring underground holes in the horizontal direction.  Claim 1 is illustrative (emphasis added):

1. An apparatus for boring a hole with a directional control from the surface comprising:

a body having an elongate axis and a front end;
a drill bit mounted at the front end of the body for rotary motion about a drill bit axis, the drill bit axis being constantly noncoincident with the elongate axis of the body at the front end;
a casing rigidly secured to the body and extending to the surface to selectively rotate the body independent of the drill bit to position the deflection Shoe to deflect the apparatus within the bore;
a deflection shoe mounted on a first side of the body; rotating structure to rotate the drill bit continuously to bore the hole, the rotating structure extending to the surface.

In 2011, CMW brought an infringement suit against Vermeer Manufacturing.  A central issue in the dispute was the design of the drill casing.  "Vermeer’s apparatus for boring is a “bent sub,” in which two sides of the body or casing are attached together to form a bend or elbow in the casing."  Order Granting Summary Judgment for Defendant, Charles Machine Works, Inc. v. Vermeer Manufacturing Co., No. 4-11-cv-507-CRW-CFB (June 21, 2012).  CMW contended that this "bent sub" structure met the "deflection shoe" and "mounted on" limitations.  After construing "mounted on" to mean "attached to" and "deflection shoe" to mean a "structure that can be attached to the side of the body or casing and that can be positioned to deflect the boring apparatus from a linear path," the district court granted summary judgment of nonfringement, both literal and equivalents.

On appeal, the Federal Circuit affirmed the district court's claim construction and summary judgment of no literal infringement without substantive discussion. The Court then turned to the doctrine of equivalents.  From the district court's summary judgment order:

Also there is no infringement in this record under the doctrine of equivalents. A bent sub is plainly different from and not the equivalent of the “deflection shoe” described over and over in the ‘569 patent that must be “mounted on” the apparatus, fully described with drawings in the patent itself. This record does not establish that persons learned in the art would deem the bent sub and mounted shoe interchangeable. See Graver Tank & Mfg. Co. v. Linde Air Products Co., 339 U.S. 605, 609 (1950). None of Vermeer’s products described in this summary judgment record infringes any of the claims in the ‘569 patent.

Order Granting Summary Judgment for Defendant at 8.  The Federal Circuit disagreed and found that the testimony of CMW's expert was sufficient to raise a genuine factual dispute under the "function-way-result" test for determining equivalency.

Vitiation: In addition to arguing the factual issue of equivalency, Vermeer's brief also raised a vitiation argument: that allowing the "bent sub" to satisfy the deflection shoe limitation would "read the “deflection shoe” and “mounted on” limitations out of the claims."  Vermeer Response Brief at 58. In addressing this argument, the Federal Circuit reaffirmed its pushback against the vitiation doctrine.  Just as the court did in Deere and Brilliant Instruments, Charles Machine Works treats vitation not as an exception to equivalency, but as simply the application of the "function-way-result" or "insubstantial differences" tests:

Vitiation is “a legal determination that ‘the evidence is such that no reasonable jury could determine two elements to be equivalent.’” Deere, 703 F.3d at 1356 (quoting Warner-Jenkinson, 520 U.S. at 39 n.8). “[S]aying that a claim element would be vitiated is akin to saying that there is no equivalent to the claim element in the accused device based on the well-established ‘function-way-result’ or ‘insubstantial differences’ tests.” Brilliant Instruments, Inc. v. GuideTech, LLC, 707 F.3d 1342, 1347 (Fed. Cir. 2013)

…

We also conclude that the doctrine of claim vitiation does not bar CMW’s application of the doctrine of equivalents. On summary judgment, the appropriate question for the court was whether no reasonable jury could find equivalence based on the record. Deere, 703 F.3d at 1356. Based on CMW’s expert declaration, we hold that a reasonable jury could have found equivalence, and the court erred by making a contrary legal determination.

Slip Op. at 8-9.  The court's conclusion in this case is particularly notable given that it applied vitiation in a very different way to a "mounted on" limitation in Asyst Technologies, Inc. v. Emtrak, Inc. 402 F.3d 1188, 1195 (Fed. Cir. 2005), ("This case falls within both that doctrine and its corollary, the "specific exclusion" principle, since the term "mounted" can fairly be said to specifically exclude objects that are "unmounted."). 

CMW's Lack of Notice: The Federal Circuit also reversed the district court's grant of summary judgment as to Vermeer's non-commercial prototypes (which include a structure called a wear pad) on the ground that CMW had insufficient notice that the summary judgment decision would include the prototypes.  Vermeer's moving papers were titled "MOTION FOR SUMMARY JUDGMENT THAT VERMEER’S COMMERCIAL
PRODUCTS DO NOT INFRINGE," its proposed rulings bore the heading "GRANT SUMMARY JUDGMENT
THAT VERMEER’S COMMERCIAL PRODUCT DOES NOT INFRINGE THE ASSERTED CLAIMS . . . OF THE
’569 PATENT," and at oral argument it indicated that the prototypes were not the focus of the motion and trial would still be required on the prototypes. 

 

Guest Post: Why Lighting Ballast Won’t Solve Claim Construction

Patent, , ,

Guest post by Thomas W. Krause and Heather F. Auyang.

In our recently-published article, What Close Cases and Reversals Reveal About Claim Construction at the Federal Circuit, 12 J. Marshall Rev. Intell. Prop. L. 583 (2013) (available at http://jmripl.com/issues/article/310), we focus on two independent sets of cases that reveal some deep truths about the current state of claim construction jurisprudence, and which show that the current problems with claim construction have little to do with the narrow "deference" issue in Lighting Ballast. 

The article reports on (1) claim construction cases in which the Federal Circuit judges disagreed on an issue of claim construction, and (2) claim construction cases where the Federal Circuit reversed a district court. 

Close Cases

We call the former set "close cases," since they are typically decided by a 2-1 vote, as opposed to a 3-0 vote.  The notion is that 3-0 cases are not all that interesting — if all the judges agree on an issue, then odds are it is not that controversial.  2-1 cases, by contrast, often reflect differences in approach between the judges.

Here is a chart that shows that in close cases, some judges predictably vote for a broader interpretation, others predictably vote for a narrower interpretation, and the remaining judges vote unpredictably. 

Krause Figure 1

If predictability is the goal, then the easiest solution would be for the Court to choose between Judges Linn and Lourie, and let that judge's principles guide claim construction in every case.  Until such a "choice" is made, claim construction in "close" cases will always be panel dependent. If Judges Lourie and Linn are both deemed “wrong,” then it is difficult to see how we will ever attain predictability in claim construction at the Federal Circuit.  The basic divide seems to be over what we call the “actually invented” standard – the approach taken by Judge Lourie (and others), and opposed by Chief Judge Rader (and others).  The Federal Circuit’s failure to take this issue en banc in Retractable Technologies guarantees that there will be a steady flow of dissents in claim construction cases for the foreseeable future.

We also looked at the same set of cases in terms of whether the judges were (i) more or less likely to be accused of "importing" a limitation from the specification, (ii) more or less likely to affirm a district court claim construction, and (iii) more or less likely to vote for the patentholder.  These parameters are not independent of the decision to vote broad or narrow (since a narrow interpretation typically aligns with the district court [see below] and against the patentholder), but it’s interesting to look at the ways in which the data do not track.  Some judges vote against the patent holder and against the district court more often than one would expect based on their broad/narrow voting tendencies, and others vote for the patent holder and for the district court more often than one would expect.  Figures 2-4 in the article show these results.

We also created individual charts for each judge, which show case by case how the judges voted in terms of broad/narrow, pro-affirm/pro-reverse, and pro-patent/anti-patent.  Here are a few contrasting examples, which underscore some of the more dramatic differences:

Krause Figure 2
Krause Figure 3
Krause Figure 4
Krause Figure 5

Just looking at these charts (without even trying to figure out what they mean) shows that these judges vote very differently from each other.  The article provides itself provides a few observations based on the charts (and an explanation of how to read them, if it’s not readily apparent).

Reversals

The reversals are also very interesting.  We focused on these cases because they – by definition – are cases in which the district court did something wrong.  What we found is that when district courts err, they tend to err in favor of a narrower interpretation.  In other words, while one might expect, all things being equal, that district courts would err as often in a broadening as a narrowing direction, all things are clearly not equal.  Over 2/3 of the time, the district court's mistake was in going narrow.  On reflection, this should not be surprising.  A narrower interpretation often permits a district court to grant summary judgment of non-infringement and thereby get the case up to the Federal Circuit without having to put the parties and the court through the time and expense of a trial.  But given this nearly systematic bias, perhaps giving more deference to district courts will not be particularly helpful.

Krause Figure 6
Krause Figure 7
Additional charts and discussion are in the article.

We welcome any comments.

Thomas W. Krause is an Adjunct Professor of Law at the Georgetown Law Center and Special Counsel for Intellectual Property Litigation at the United States Patent & Trademark Office.  Heather F. Auyang is Senior Counsel at LTL Trial Attorneys in Redwood City, California. The views and opinions expressed herein are those of the authors and do not reflect the views or opinions of the United States Patent and Trademark Office or LTL Trial Attorneys.

 

Model Order Addressing Numerosity of Claims and Prior Art [UPDATED]

Patent,

By Jason Rantanen

UPDATE: On Wednesday, the content of the Advisory Council page on the Federal Circuit's website was removed and replaced with the message "This site is being updated and will be posted soon."  Consequently, the two Model Orders referenced below are no longer available at the Court's website.

This morning the Federal Circuit Advisory Council, a committee including practitioners and academics formed to advise the Federal Circuit on the rules and internal operating procedures of the court, released its Model Order Re: Excess Claims and Prior art.  Download Model Order Excess Claims

The Model Order is being provided as an aid to trial courts should they choose to exercise their discretion to limit the number of claims and prior art references asserted by patent holders and accused infringers.  While it is not binding on district courts, and its specific language has not been approved by the Court of Appeals for the Federal Circuit, this model order holds the potential to be a powerful mechanism for standardizing the procedures of patent litigation.  (It's also worth noting that Chief Judge Rader, three district court judges and an ITC judge served on the Model Order committee itself).  It should also be noted that the order itself is flexible and can be tailored to individual cases.

Some key points:

  • Limits imposed at two points: A preliminary stage occuring after production of "core" technical documents but before claim construction and a final stage after claim construction but before expert reports consisting of a subset of the preliminary claims/references.
  • At both stages the patent holder first identifies the asserted claims.  Fourteen days later the patent defendant identifies the prior art references.   
  • Preliminary stage: the patent holder is limited to no more than 10 claims from each patent and not more than 32 claims total, while the patent defendant is limited to no more than 12 prior art references against each patent and not more than 40 references total.
  • Final stage: the patent holder is limited to no more than 5 claims from each patent and not more than 16 claims total, while the patent defendant is limited to no more than 6 prior art references per patent and not more than 20 references total.  
  • The Model Order also includes a three-page explanation, with citations, of why adopting an order limiting excess patent claims and prior art benefits both the court and the parties themselves. 

The Model Order Re: Excess Claims follows on the heels of the Advisory Council's E-Discovery Model Order, which Dennis previously wrote about.  I've heard from several practitioners that the E-Discovery Model Order has produced a substantial positive impact on discovery in patent litigation, and that the trend is toward leaner, more focused discovery.  I'd be interested in hearing whether that's reflective of patent litigation more broadly.