Supreme Court Patent Cases: Malpractice, Obviousness, and Venue

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by Dennis Crouch

The Supreme Court will begin granting and denying petitions in early October.  Meanwhile, several new petitions are now on file.  Last week I wrote about the TC Heartland case as a mechanism for limiting venue. Without any good reason, the Federal Circuit overruled a 1957 Supreme Court case that had strictly limited patent venue as spelled out in the patent venue statute 1400(b).  See VE Holdings (explaining its overruling of Fourco Glass). A result of VE Holdings is the expansive venue availability that facilitated the rise of E.D. Texas as the most popular patent venue. TC Heartland simply asks the Supreme Court reassert its Fourco holding - something that could almost be done with a one-line opinion: "REVERSED. See Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222 (1957)."  The best arguments for the Federal Circuit's approach are (1) the reasoning of Fourco itself is a bit dodgy; and (2) VE Holdings is well settled doctrine (decided 26 years ago) and Congress has revised the statutory provisions several times without amending.  As a side note, several members of Congress have suggested they will act legislatively if SCOTUS fails to act.

Two new petitions (Grunenthal v. Teva and Purdue v. Epic) stem from the same Federal Circuit OxyContin case and focus on anticipation and obviousness respectively.  Grunenthal v. Teva questions how 'inherently' operates for anticipation purposes.   Purdue suggests that - despite the final sentence of Section 103, that the actual circumstances of the invention should be available to help prove non-obviousness (but still not be available to prove obviousness).   Another new petition includes the BPCIA case Apotex v. Amgen that serves as a complement to the pending Sandoz case questioning the requirements and benefits of providing notice of commercial marketing.

Finally - Encyclopedia Britannica v. Dickstein Shapiro is a patent prosecution malpractice action.  The lower court held the lawyers harmless since Alice would have invalidated the patents even if drafted to perfection. The petition asks whether Alice Corp can excuse patent prosecutors from alleged prosecution errors made well prior to that decision.

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Supreme Court Patent Cases: Previewing the October Term 2016

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by Dennis Crouch

When the Supreme Court's October 2016 Term begins in a few weeks, its first patent hearing will be the design patent damages case of Samsung v. Apple. In Samsung, the Court asks: Where a design patent is applied to only a component of a product, should an award of infringer's profits be limited to those profits attributable to the component?  The statute at issue - 35 U.S.C. § 289 - indicates that, someone who (without license) "applies" the patented design (or colorable imitation thereof) to an article of manufacture, "shall be liable to the owner to the extent of his total profit."  Up to now, courts have repeatedly held that the "profits" are profits associated with the product (i.e., the article of manufacture) being sold, but Samsung is asking that the profits be limited only to components of the product closely associated with the patented design.  Although Apple's position is supported by both the text and history and is the approach easiest to calculate, I expect that many on the Court will be drawn to the potential unjust outcomes of that approach.  Apple wins in a 4-4 split.  Oral arguments are set for October 11, 2016.

The court has granted certiorari in two other cases for this October 2016 term with briefing ongoing. In Life Tech v. Promega, the court again takes up the issue of exporting components of a patented invention and the extraterritorial application of US law.  35 U.S.C. § 271(f)(2). The question here is whether export of one component can legally constitute the "substantial portion of the components" required by statute for liability to attach.  In the case, the component (Taq) is a commodity but is also an admitted critical aspect of the invention. In SCA Hygiene v. First Quality, the Court asks whether the equitable defense of laches applies in patent cases.  The case is a follow-on to the Supreme Court's 2014 holding in Petrella v. MGM that laches does not apply in copyright cases.  In its decision, the Federal Circuit distinguished Petrella based both upon statutory and policy arguments. Oral arguments in SCA are set for November 1, 2016.

The three pending petitions most likely to be granted certiorari are Impression Products (exhaustion); Amgen (BPCIA); and GlaxoSmithKline (antitrust reverse payments)   However, these cases are awaiting views of the Solicitor General -- which likely will not be filed until well after the presidential election.

A substantial number of cases are set for the Supreme Court's September 26 conference.  These include the constitutional challenges to IPR coming in MCM and Carl Cooper as well as the interesting eligibility case of Genetic Tech v. Merial.

It looks to be an interesting term.

The big list:

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