All posts by Jonathan Hummel

Patently-O Bits and Bytes No. 119

Bits and Bytes, Patent,
  • The AP on Hugo Chavez: Venezuelan officials plan to invalidate some pharmaceutical patents and allow domestic manufacturers to produce licensed medicines, an action that could cause shortages and scare off foreign investment, industry leaders said Sunday. [AP][via PatentHawk]
  • BPAI Data: An updated version of yesterday’s paper on BPAI decision data is available online here: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1423922. Comments are welcome.
  • New Blog: Rocket Docket IP Litigation (E.D. Va. Patent Focus). The blog is edited by the folks at Williams Mullen. Their latest post is an update on the false marking litigation against Solo Cup.
  • National Patent Jury Instructions: A comittee assembled by Chief Judge Michel has released its set of model jury instructions. Although Judge Michel assembled the committee, the introduction makes clear that the instructions “have not been endorsed by the Federal Circuit Court of Appeals, and are not “official” jury instructions.” However, the instructions are likely to serve as the ongoing model. http://www.nationaljuryinstructions.org/.

Bits and Bytes No. 117: Data, Damages & Deferred Examination

Bits and Bytes, Patent
  • Data.Gov: As part of the transparent government project, we now have the website Data.Gov with the purpose of “increas[ing]public access to high value, machine readable datasets generated by the Executive Branch of the Federal Government.” So far, the PTO has only included two datasets -both of which were already available through the PTO website. Hopefully there will be more to come – including opening access to PAIR. [More here].
  • IP Colloquium: Professor Lichtman has released a new edition of his audio-program IP Colloquium. This month’s program focuses on reforms of the patent damages laws. [LINK] The program offers CLE Credit.
  • Deferred Examination: Comments on a potential deferred examination program are here.
  • Deferred Examination: Intel’s comments are interesting. The company argues that the success of deferred examination in other countries is a facade. Rather, the high rate of drop-out during prosecution in countries such as Japan, Germany, and Korea is due to the inventor compensation schemes in those countries. So the story goes – companies in those countries tend to file more low-quality local patent applications for the purpose preempting inventors from asserting rights on their own.

“We actually believe that the reason that deferred examination has had little success in the United States is due to the inventor compensation schemes that exist in many countries such as Japan, Germany and Korea.

In essence, under the regimes in these countries, if the company fails to patent the invention, the inventor has the right to file on his or her own behalf. Having inventors file on their own behalf is generally viewed as undesirable. As a result, the companies file disproportionately more applications in their home jurisdictions than normal prudence would otherwise suggest. Since they are filing these in part to pre-empt the inventor’s rights and to avoid having additional inventor compensation issues, we believe that this contributes to an inclination to avoid paying the examination fee and then to abandon the patent application.   

However, outside their home jurisdictions, these companies have a tendency to file a fraction of the patents that they file in their home jurisdictions. Having filed in the home jurisdiction, they have little or no concern that the inventor has the right or will file the application overseas. Apparently, as a result, they do not appear to abandon nearly as high a percentage of the patent applications that they file outside their home jurisdictions as they file in their home jurisdictions.

Of course, the US does not have such inventor compensation statutes. Those foreign companies that file and abandon so heavily in their home jurisdictions exhibit radically different behavior in the US. They file less and abandon much less. Hence, we believe that this helps explain the disparate experience of deferred examination in other countries. It means that the practice in these other countries is not likely to be a good indicator for practice before the USPTO.”

Patently-O Bits and Bytes No. 111

Patent

Courtoon via David Mills.

Although patent activity may be down 10%, it is still much more active than it was a decade ago. Folks are hiring:

Patently-O Bits and Bytes No. 110

Articles and Publications, Bits and Bytes, Patent, ,
  • Tom Bakos and Mark Nowotarski have posted their own inventions on the Peer-to-Patent site. You can review them and add prior art: Invention 1, a Risk Assessment Company; Invention 2, SoberTeen Driving Insurance
  • I am expecting an announcement of the next PTO director on Friday (May 8). Jim Pooley is being nominated as deputy director of WIPO and is apparently out of the running for the job of PTO director. The two leading candidates thus appear to be Todd Dickinson and David Kappos.
  • If Kappos is nominated, the Peer-to-Patent system (originally funded by IBM) will receive a boost.
  • Speaking of WIPO, the US has proposed “comprehensive” PCT Reform “which would result in the establishment of a new Patent Cooperation Treaty, PCT II. The new treaty would serve to better facilitate workload sharing between the patent offices.
  • I just looked at Prof. Margo Bagley new article on First-to-Invent published in the Berkeley Technology Law Journal. Her conclusions: “The US First-to-Invent system may be unique in the world but it offers significant benefits to small entity entrepreneurs and others.” Bagley sees these benefits as primarily coming through the “robust grace period.” When should FITF be adopted? “Only when such a move will provide a clear advantage for small entities by facilitating the adoption of a one-year grace period outside of the US.” See The Need for Speed (and Grace).
  • Bagley’s short article is well received. My one quibble is that she perpetuates the idea that a desire to end interferences is a major motivation in the debate. She says “Eliminating interferences and the uncertainty associated with them appears to be a prime motivation for the FITF legislation.” Lets be clear, in the US, proponents of the first to file legislation want to make it easier to invalidate patents by creating more prior art.

Patently-O Bits and Bytes No. 109

Bits and Bytes, Patent
  • Quote of the week: “Am I starting to grow nostalgic for Jon Dudas? At least he hated all applicants, big and small. Jon, Jon, Jon – should I have not doubted your wisdom?” Greg Aharonian, on contemplating the potential that Dave Kappos (IBM) will be the next PTO director.
  • My Discussion of Kappos: Here.
  • Section 2 of the Sherman Act: The Truth on the Market Blog is hosting a series of interesting articles on reforms of Section 2 (unilateral monopolization). Expect a post from IP/Antitrust leader Hovenkamp on Tuesday or Wednesday. [Link].

Bits and Bytes No. 108

Bits and Bytes, Patent

Patently-O Bits and Bytes No. 105

Patent
  • Irreparable Injury: I have written about this before, but I am still struggling with a basic question from eBay v. MercExchange: Is there any distinction between the first two elements of eBay’s test for permanent injunctive relief [Irreparable injury vs. the inadequacy of available remedies at law]? Ordinarily, the first element of irreparable injury is defined as a substantial injury that cannot be fully compensated by available remedies at law (such as money damages). The ordinary test for preliminary injunctive relief collapses these and only looks at irreparable injury.
  • Future Harms?: Second, what should we make the eBay’s use of the present perfect tense in the irreparable injury requirement: “A plaintiff must demonstrate: (1) that it has suffered an irreparable injury.” I guess that this makes sense if it is an indication that the irreparable harm must be an ongoing harm rather than a merely future harm?
  • Patent Litigation Data: Professor Colleen Chien’s new article uses the newly taboo troll label in its title. I report on the article here because of her data-derived conclusion that it would be improper to “blame non-practicing entities (“NPEs”) for a majority of the problems with the patent system.” In fact “public and large private companies” have initiated the largest share of patent litigation in the past 8 years. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1396319 .
  • History: Professor Adam Mossoff is posting this week at the Volokh Conspiracy on his new article “A Stitch in Time: The Rise and Fall of the Sewing Machine Patent Thicket.” The story is 150 years old, but it amazingly shows that today’s arguments on patent reform are nothing more than rehash http://volokh.com/posts/1240974253.shtml .

Bits and Bytes No. 102

Patent
  • PPAC Nominations are due by May 15 – The new PTO director will presumably pick the nominee and will likely have time to suggest a nominee.
  • IP Scholars Conference 2009: This annual event will be held at Cardozo Law in NYC on August 6th and 7th, 2009. This is usually a large gathering of IP focused academics and academic minded individuals presenting original works-in-progress. Deadline for submissions is April 30, 2009. Individual submissions and questions should be directed to David Morrison at dmorriso@yu.edu. For more information, visit www.ipscholars.org. Submissions include topic, abstract, author name, & academic affiliation.
  • ANDA Infringement: Section 271 of the patent act provides a cause of action for patent infringement based on an unauthorized submission of an abbreviated new drug application (ANDA) for a patented drug or method. In a recent decision, the New Jersey district court found that the submission may still be an act of infringement even if the ANDA itself does not provide sufficient information to conclude that the use would be infringing. Instead, “the Court must look to the whole of the product, which means considering its ultimate useable state, as well as the ANDA-contemplated process and compound.”PDL Biopharma, Inc. v. Sun Pharm. Indus. Ltd., 2-07-cv-01788 (NJD March 31, 2009).

Federal Circuit Affirms $4.6 million award for litigation misconduct

Attorney Fees, Damages, Patent, Patent Cases 2009

ICU Medical v. Alaris Medical System pic-14.jpg (Fed. Cir. 2009)

ICU’s patents covers technology for using syringes to add drugs to an IV. The district court granted summary judgment of invalidity and also awarded attorney fees and found a violation of Rule 11 of the Federal Rules of Civil Procedure. Alaris was awarded $4.6 million in attorney fees and sanctions. On appeal, the Federal Circuit affirmed.

Section 285 of the Patent Act provides for the award of attorney fees to the winning party in “exceptional cases.” In Brooks Furniture, the Federal Circuit discussed a two-part test for whether attorneys fees may be awarded due to litigation conduct. The test requires that “both (1) the litigation is brought in subjective bad faith, and (2) the litigation is objectively baseless.” A district court fee award will be affirmed absent clear error.

The problem – ICU argued that the claim term “spike” could be a non-pointed structure such as a tube even though the specification “repeatedly and uniformly describes the spike as a pointed instrument.” The claim construction was not ICU’s only problem:

For example, the district court found that ICU made “multiple, repeated misrepresentations . . . to the Court regarding its own patents in an effort to conceal what are now characterized as errors in order to rescue the TRO/PI from denial.” These misrepresentations related to (1) ICU’s assertion of claims in the ’509 patent that were identical to claims in the ’592 patent (i.e., assertion of double-patented claims); (2) ICU’s assertion of more double-patented claims from the ’509 patent even after Alaris and the district court warned ICU of the double-patenting issue; (3) ICU’s misrepresentation of Federal Circuit authority; (4) ICU’s representation that figures 13 and 20–22 of the common specification “clearly” disclosed a spikeless embodiment, only to later acknowledge that these figures do not disclose such an embodiment and state that its representation was an “honest mistake.”

Although the Brooks Furniture rule discusses objectively baseless “litigation,” that rule is not construed to focus on the litigation as a whole. Rather, attorney fees may be assessed if any portion of the litigation is brought in bad faith and in an objectively baseless manner. Here, the Federal Circuit found that the lower court had “appropriately exercised its discretion in awarding attorney fees only for [a] portion of the litigation.”

Notes:

  • Federal Circuit Decision 08-1077.pdf
  • District Court award of Fees: 232495.pdf. Bottom line: “The Court finds that Alaris is due $4,587,622.44 in attorney fees and $164,721.19 in costs for the reasons set forth below. . . . This represents a reasonable lodestar calculation for Alaris’ work . . . , and it constitutes a reasonable pro rata amount of Alaris’ total expenditure of $11,000,000 in attorney fees and $2,000,000 in costs overall in this case.”
  • District Court decision to find a Section 285 exceptional case and Rule 11 sanctions. 232494.pdf. Money Quote: “[The submitted declarations] do not substantively justify or excuse ICU’s litigation tactics or show its good faith. These declarations were prepared by ICU’s litigation counsel for the purpose ofopposing the Rule 11 and Fees Motions, and comprise mostly self-serving assertions of good faith by interested witnesses, such as ICU’s CEO (Dr. George Lopez), trial counsel (Fulwider, Patton, Lee & Utecht; Paul Hastings; or Pooley & Oliver), patent counsel (Knobbe Martens) and its paid experts (Dr. Maureen Reitman and Bob Rogers). These materials lack the indicia of credibility provided by declarations or opinions from outside, independent counsel or experts, particularly outside patent, as opposed to litigation, counsel. Most of the materials appear to have been “memorialized” in retrospect, providing marginal support compared to, for example, an ex ante documented and vetted analysis that preceded the litigation or that, al minimum, preceded the TRO/PI request and the inclusion of the “spike” claims in the amended complaint.”
  • Although the district court decision appears to identify the Fulwider firm as “trial counsel,” that appears to have been a mistake made by the court. A Fulwider attorney has indicated that their firm “was never one of ICU’s trial counsel in that matter, and thus made no representations to the court on ICU’s behalf.” In fact, ICU appears to be somewhat of a toxic client. According to the court documents, Fulwider represented ICU in the 1990’s. At some point ICU dropped the firm as a client and sued for malpractice based on Fulwider’s representation of alleged ICU competitors. Fulwider did not admit wrongdoing, but a 2007 press release by ICU claims that ICU “will be paid $8 million in settlement of its claims against Fulwider.”

Patently-O Bits and Bytes No. 93

Bits and Bytes, Conference or CLE, Patent, Reexamination

Upcoming Events

  • Northwestern Law School’s Journal of Technology and Intellectual Property (NJTIP) is putting on a great event in Chicago on March 6, 2009 (Friday). Bob Irvine will be debating Bilski with Lauren Katznellenbogen. Irvine is a partner at my former firm, MBHB – He is amazingly smart and was my resource whenever I had difficulty understanding some complex technology. The debate is moderated by blogger R. David Donoghue. (The notice includes a disclaimer that the positions “are for advocacy purposes” and might not reflect the positions of the parties or their firms. Other speakers include Judge Holderman, Dr. Chris Singer (of Patent Docs and MBHB), Profs Seymore and Sag, and Mike Baniak (also of MBHB). [Symposium Website]
  • The IP Law Summit – March 17-19 – hosted by the marcus evans company will be a nice event in Ponte Vedra, Florida. I will be speaking there along with Marc Began (Novo), Manny Schecter (IBM), Bruce Schelkoph (Cummins), Scott Kief (Wash U), Bruce Pokras (Pfizer), Colin Raufer (Boeing), Mony Ghose (BD), Ken Collier (Medtronic), Scott Reid (Lenovo), Chris Turoski (Cargill), Hope Mehlman (Regions Financial), Tom Boshinski (Mead), Wendall Guffy (Nestle), Tim Wilson (SAS), Robert Renke (Flashpoint), John Parrish (Sanofi), Mike Jaro (Medtornic), and Phyllis Turner-Brim (Intermec).

Stays pending reexamination:

  • I continue to be surprised that courts grant stays of litigation pending re-examination – especially inter partes reexaminations which tend to be incredibly slow. In Wall Corp. v. BondDesk Group, LLC (D.Del. Feb. 24, 2009), district judge Gregory Sleet granted the defendant’s motion to stay the litigation pending inter partes reexaminations. The fact that the reexamination was inter partes was especially important to the court since the potential “estoppel will resolve many of the invalidity issues and streamline the litigation.” In a decision last week in Affinity Labs v. Dice Electronics, LLC, (E.D.Tex. February 20, 2009), the Texas-based Federal Court denied a stay pending ex parte reexam noting that the ex parte approach allows the “Defendant to lay behind the log, hoping for favorable developments with the passage of time. Instead of streamlining the process, Defendants’ choice guarantees the imposition of additional costs … and indicates a lack of desire to resolve the issues in the case in a timely manner.”

Late Patents:

Provisional Patent Applications: Waiting to File Non-Provisionals

Academic Studies, Articles and Publications, Patent, Provisional Patent Application

For better or worse, provisional patent applications have always been used as a way to delay patent prosecution. The procedure has become popular as a relatively cheap and informal mechanism for preserving priority of invention without losing patent term. Although a provisional application sets a priority date, the application does not even reach the examination queue until the full utility patent application is filed. Thus, on average, each day of delay in filing the utility patent application pushes the issue date back one day as well. However, provisional applications also serve as a mechanism for extending the tail end of the patent term because the twenty-year patent term does not begin to run until filing of the utility patent.

Provisional applications have become quite popular. In FY2007, for instance, over 132,000 provisional applications were filed and about 30% of recent patents assigned to US companies reference a provisional filing. [Link]

To see how provisional filings are being used, I compiled a set of 65,000 patents that issued sometime between Jan 2007 and Feb 2009 (inclusive). All the patents in the group share the common property of claiming priority only to one or more provisional applications. I additionally excluded patents that made other priority claims such as continuations, divisionals, and continuations-in-part. Once I formed the set of patents, I then looked at the filing date of the provisional application compared with the filing of the utility application to how applicants are using the extra year of deferred examination. For patents claiming priority to multiple provisional applications, I used the date of the earliest filed provisional application.

The graph below shows the result. The vast majority of applicants wait until the year is almost up before taking action and filing the non-provisional application. About two-thirds of the non-provisional applications were filed with less than ten days remaining in the one-year provisional pendency. In over ten percent of the cases, applicants properly filed the non-provisional more than 365 days after the original provisional filing because of weekends, holidays, and/or leap year.

200902212058.jpg

Two weeks ago, I had a conversation with a patent litigator about the propensity of patent attorneys to barely meet deadlines. He was worried about the potential for malpractice claims against his firm. And, here, I found a surprising number of cases that appear to miss the deadline.

My lingering question for patent attorneys and applicants — why delay so long? Is it simply a matter of doing work according to deadline? Does it matter that delaying filing the application also delays the eventual issuance of the patent?