USPTO Guidelines: Amgen is a Nothingburger

Patent

by Dennis Crouch

The USPTO has published new examination guidelines regarding the enablement requirement for utility patent applications in light of the Supreme Court’s May 2023 decision in Amgen v. Sanofi, 143 S. Ct. 1243 (2023).  As I explain below, the primary takeaway from the published examination guidelines is that the PTO will continue business as usual — i.e., Amgen did not significantly change the law.  Still, there are, some key points to consider. Notably, the guidelines: (1) provide a reminder that enablement applies to all technology areas, not just biotech; and (2) suggests that the office may increase its assertion of the enablement doctrine against functionally defined claim limitations that are potentially directed to a large number of embodiments.

Background on Amgen v. Sanofi: In its unanimous opinion, the Supreme Court affirmed that Amgen’s broad functional claim was invalid having failed the requirements that claims must be enabled to their full scope, allowing for “a reasonable amount of experimentation.” Amgen. The claim at issue included a key broad functional element — covering all antibodies capable of binding with and disabling a particular enzyme (PCSK9).  Although the Federal Circuit commented negatively on the functional aspect of the claim, the Supreme Court noted that there is no special rule for functional claims.  Still, functional claims can often be suspect on enablement grounds because of their potential breadth that goes well beyond tech disclosed. The result then is a simple rule: broader claims require more detailed disclosure.

If a patent claims an entire class of processes, machines, manufactures, or compositions of matter, the patent’s specification must enable a person skilled in the art to make and use the entire class. . . . The more one claims, the more one must enable.

Id.  To be clear the specification is not required to “describe with particularity how to make and use every single embodiment within a claimed class.” Id.  In fact, I would posit that in most situations it is effectively impossible to describe all potential embodiments covered by a modern comprising-style patent claim. Instead of fully describing every potentiality, the court concluded that the specification must provide enough disclosure to “reliably enable a person skilled in the art to make and use all of what is claimed, not merely a subset” allowing for a reasonable amount of experimentation. Id. The threshold for enablement can often be difficult to ascertain, but here the Supreme Court made clear that Amgen’s specification was more of a research assignment than an enabling disclosure. The Court also noted that whether experimentation is reasonable depends on the context, citing Minerals Separation, Ltd. v. Hyde, 242 U.S. 261 (1916).

Two potential Points of Confusion: The Supreme Court’s analysis in Amgen introduced two potential points of confusion regarding enablement doctrine. First, while citing a litany of its own old precedent on enablement related to technologies like telegraphs and incandescent light, the Court did not explicitly reference leading contemporary Federal Circuit decisions that articulate enablement standards. Most notably, Amgen does not mention In re Wands, 858 F.2d 731 (Fed. Cir. 1988) and its seminal “Wands factors” that are regularly relied upon by patent examiners and litigants to assess if PHOSITA would need to conduct an unreasonable amount of experimentation in order to make and use the invention. These Wands factors include:

  • (A) the breadth of the claims;
  • (B) the nature of the invention;
  • (C) the state of the prior art;
  • (D) the level of one of ordinary skill;
  • (E) the level of predictability in the art;
  • (F) the amount of direction provided by the inventor;
  • (G) the existence of working examples; and
  • (H) the quantity of experimentation needed to make or use the invention based on the content of the disclosure.

Wands (noting that this is not an exhaustive list of potential factors).  Although relied upon daily in the patent system, the Supreme Court did not reference the Wands factors in its analysis. This omission created a question of whether Wands and its factors are still applicable.

The second issue is related to the first, and it has to do with a subtle shift in the language that the court used in forming the test.  In Amgen, the Supreme Court offered repeated reference to “reasonable experimentation” rather than the typical “undue experimentation” standard.  This difference introduced potential confusion on whether the Court announced a distinct, new test.

In post Amgen cases, the Federal Circuit has resolved these two subtle points of confusion, holding (1) that there is no difference between the traditional statement of “without undue experimentation” and the Supreme Court’s similar wording of a “reasonable” amount of experimentation; and (2) that the Wands Factors continue to serve as the key approach to determining whether the amount of experimentation needed to make & use the invention is too much.  The case that explains this best is probably Baxalta Incorporated v. Genentech, Inc., 81 F.4th 1362 (Fed. Cir. 2023).

Its new guidelines, published January 10, 2024, the PTO reviews Amgen and post-Amgen case law and concludes that examiners will continue applying the long-standing “undue experimentation” standard and In re Wands factors when evaluating enablement. Guidelines for Assessing Enablement in Utility Applications and Patents in View of the Supreme Court Decision in Amgen Inc. et al. v. Sanofi et al., 83 Fed. Reg. 1563 (Jan. 10, 2024).

From my initial review, these guidelines do not appear remarkable, but simply serves the purpose of keeping everyone on the same page.  It remains to be seen whether the examiner corps will further increase its focus on functional genus claims – especially those directed to a large number of embodiments and whether examiners outside the traditional ‘unpredictable arts’ will alter their enablement examination practice.

To be clear, these are examination guidelines – guidance for patent examiners that supplement the Manual of Patent Examination Practice (MPEP). They are not “rules” and do not have the force of law.

Claim Construction and its Role in Eligibility

Patent

by Dennis Crouch

In 2022, the Federal Circuit issued a Judge Hughes decision in IBM v. Zillow invaliding the claims of IBM’s asserted claims as ineligible subject matter. Intl. Bus. Machines Corp. v. Zillow Group, Inc., 50 F.4th 1371 (Fed. Cir. 2022) (U.S. Patent No. 9,158,789). In that case, Judge Stoll dissented in part, arguing that dismissal on the pleadings was inappropriate because the patentee had alleged plausible and specific facts showing that the claims embodied inventive concepts.

Now in 2024, the Federal Circuit has issued a new opinion in separate IBM v. Zillow case with patents from a different family. U.S. Patent Nos. 6,778,193 and 6,785,676. Seemingly by happenstance, Judges Hughes and Stoll were both on this panel. Judge Hughes again wrote the majority opinion affirming the motion to dismiss on eligibility grounds; Judge Stoll again dissented-in-part, concluding that the district court should have construed the claims (or preliminary relied upon IBM’s proposed construction) before deciding eligibility.

Intl. Bus. Machines Corp. v. Zillow Group, Inc., — F.4th — (Fed. Cir. January 9, 2024) 

The two asserted patents related to improving the display of search results to users by using “visual workspaces” (the ‘193 patent) and “user context vectors” (the ‘676 patent) to better capture user preferences and context.  The majority found these techniques covered only abstract ideas of “identifying, analyzing, and presenting certain data to a user.”  This holding parallels the 2022 IBM decision as well as others, such as Customedia Techs., LLC v. Dish Network Corp., 951 F.3d 1359 (Fed. Cir. 2020).

In dissent, Judge Stoll argued that the majority failed to properly consider IBM’s proposed construction of the term “user context vector” in the ‘676 patent claims. IBM asserted this term should be construed as “an n-dimensional vector derived from the combination of user context and previous interaction with the system,” which Judge Stoll argued “add[ed] a degree of particularity.” But the majority stated Zillow had not disputed this construction, so there was no claim construction issue for the district court to resolve.

A key dispute in the case centered on whether IBM’s allegations of technological invention beyond the abstract idea were sufficient to survive dismissal. The majority held these allegations too “generic.” contrast, dissenting Judge Stoll argued reversal was warranted because “IBM has demonstrated that its claims plausibly recite an inventive concept under its proposed construction.”

Representative Claim 1 is below. What do you think?:

1. A graphical user interface for a customer self service system that performs resource search and selection comprising:

a first visual workspace comprising entry field enabling entry of a query for a resource and, one or more selectable graphical user context elements, each element representing a context associated with the current user state and having context attributes and attribute values associated therewith;

a second visual workspace for visualizing the set of resources that the customer self service system has determined to match the user’s query, said system indicating a degree of fit of said determined resources with said query;

a third visual workspace for enabling said user to select and modify context attribute values to enable increased specificity and accuracy of a query’s search parameters, said third visual workspace further enabling said user to specify resource selection parameters and relevant resource evaluation criteria utilized by a search mechanism in said system, said
degree of fit indication based on said user’s context, and said associated resource selection parameters and relevant resource evaluation criteria; and,

a mechanism enabling said user to navigate among said first, second and third visual workspaces to thereby identify and improve selection logic and response sets fitted to said query.

As an aside, the panels of the two cases were not identical. In the IBM 2022, the Judge Reyna joined the majority, in IBM 2024, Judge Prost joined the majority.

Goutam Patnaik (Desmarais) argued on behalf of the patentee IBM, Steven Seigel (Susman Godfrey) argued for the defendants.

Yes, a “single biomolecule” means one biomolecule

Patent

by Dennis Crouch

Pacific BioSciences v. Personal Genomics (Fed. Cir. 2024)

PacBio was partially successful in its IPR against Personal Genomics that resulted in cancellation of some claims of US7767441.  Both sides appealed with PacBio wanting all the claims cancelled, and Personal Genomics wanting restoration of its patent rights. The case focuses on preamble claim construction and interpreting the prior art.

Construing the Preamble: The claims were directed to “an apparatus for identifying a single biomolecule, comprising” three different elements. The preamble here has a purposive statement “for identifying a single biomolecule,” and a key question in the case is whether the preamble should be limiting. In the IPR, the patentee wanted a narrow construction – giving effect to the preamble – in order distinguish its invention from prior art apparently not capable of single-molecule identification.

The PTAB found the preamble as limiting and the Federal Circuit affirmed that holding on appeal. This is probably a case where the PTAB’s move to the Phillips v. AWH standard from Broadest-Reasonable-Interpretation during inter partes review.

The general presumption in patent claim construction is that the preamble is not limiting for obviousness purposes. But, the preamble can be given weight when it crosses some threshold of providing important meaning to the claimed invention.  Here, the preamble identified “a single biomolecule” and body of the claim referenced “the biomolecule.”  This antecedent basis for referencing the biomolecule was enough for the PTAB find the preamble limiting, and that construction was not appealed.

What was appealed was the actual construction of “a single biomolecule.”  Petitioner argued that the claims should cover identifying a biomolecule by making copies, examining the resulting ensemble, and inferring the identity of the original molecule. But the court rejected this, finding it inconsistent with the language of the claim as supported by the specification describing problems of such ensemble approaches.  Of interest, the court decided that the ordinary meaning of “identifying” should be applied and thus cited two dictionary definitions.

A final note on this preamble construction is that it could also be given no meaning because it appears simply state the purpose of the device (and thus not really limiting) rather than a structural limitation (that would be limiting).  On appeal, the Federal Circuit noted that this issue was not challenged on appeal, but that there is precedential to support the notion that the phrase “for identifying a single biomolecule” is a limitation on the capability of the machine rather than simply a statement of purpose.

Scope of the Prior Art: One of the key prior art references (Hassibi) described its detection sensitivity “as low as 0.1 attomoles,” which is >60,000 molecules.  Thus, the court was able to affirm that Hassibi does not meet the requirement of identifying a single biomolecule.

The patentee also argued that a second reference (Choumane), did not detect a single molecule.  The patentee’s expert conducted a number of calculations and testified that Choumane’s sensitivity required at least 78 biomolecules — i.e., more than one.  But, the text of Choumane disclosed “detection and observation of individual [biomolecules].”  On appeal, the Federal Circuit recognized that that the expert’s calculations might have merit, but that the Board had substantial evidence to support its conclusion that Choumane disclosed a single molecule detector.

[T]his type of calculation can be proper where based on the express disclosures of a
piece of prior art. In this case, however, the Board, considering the calculation, had sufficient reason, in light of the Choumane statement quoted above, to reject the inference about Choumane that PGI offered the calculation to support.

Id.  Although obviousness is a question of law, it must be supported by various factual findings, including a determination of the scope and content of the prior art.  This means that the Court gives deference to the PTAB — affirming its factual finding so long as there is enough evidence available that a reasonable fact finder could rule as the Board ruled.  See Shoes by Firebug LLC v. Stride Rite Children’s Group, LLC, 962 F.3d 1362, 1369 (Fed. Cir. 2020).

Edward Reines of Weil Gotshal argued for the patentee; Keith Orso of Irell & Manella argued for petitioner. The panel included judges Prost, Taranto, and Hughes, with Judge Taranto authoring the opinion.

A publication “by others” under pre-AIA Section 102

Patent

by Dennis Crouch

The text of pre-AIA Section 102(a) suggests that an inventor’s own prior publication qualifies as invalidating prior art, even if within the 1-year grace period.  Although the statute includes a “by others” caveat, the clause’s grammar suggests that qualification only applies to prior art created by being “known or used” and does not apply to printed publications.  Here is the statute:

A person shall be entitled to a patent unless —(a) the invention was known or used by others in this country, or patented or described in a printed publication in this or a foreign country, before the invention thereof by the applicant for patent.

35 U.S.C. § 102(a)(pre-AIA).  In the statute, “by others” modifies “known or used” but does not appear to modify “patented or described in a printed publication.”  As the Federal Circuit’s precursor explained, a strait reading of the statute “would negate the one year period afforded under § 102(b) during which an inventor is allowed to perfect, develop and apply for a patent on his invention and publish descriptions of it if he wishes.” In re Katz, 687 F.2d 450 (C.C.P.A. 1982).  In Katz, the court recognized the difficulty in the statute, but determined that a non-grammatical reading was the best reading in order to protect grace period rights.  Id.

A case pending before the Federal Circuit focuses on the meaning of “by others” and asks whether a press release by the patent owner quoting one of the inventors qualifies as prior art under 102(a).  Salix Pharmaceuticals et al. v. Norwich Pharmaceuticals, Docket No. 22-2153 (Fed. Cir.).  Oral arguments were held January 8 2024, and a decision is expected later this year.

The case centers on two patents covering methods of using the drug rifaximin to treat irritable bowel syndrome with diarrhea (IBS-D). U.S. 8,309,569 and U.S. 10,765,667.  Both patents have priority dates from early 2008. In finding the claims obvious, the lower court relied largely on a September 2007 press release from the patentee reporting positive Phase II trial results on using a particular dosage of rifaximin to treat IBS-D.  Although the press release does not disclose exact invention eventually claimed, it does disclose aspects of the invention that arguably renders the subsequent claims obvious.   (Although I don’t write about it here, the patentee argues that even if the press release is prior art, it still does not render the claimed invention obvious).

The press release specifically quotes and references Dr. Bill Forbes, who is listed as an inventor on the IBS-D patents. This press release is also discussed in the patent specifications. Salix argues this means the press release reflects the inventor’s own work, not the work of “others,” and thus does not qualify as prior art that can be used against the patents.

At oral argument, the attorney for Salix, William Peterson (MorganLewis), focused on how Norwich as the challenger failed to carry its burden of proving by clear and convincing evidence that the press release was prior art – i.e., that it reflected work done by “others” not inventors. He reiterated how the press release quotes the inventor and patents describe the underlying study, clearly tying it to the inventors. In his view, this means it cannot be Section 102(a) prior art used to invalidate the patents as obvious.

But the judges pushed back with probing questions about inventor Forbes being quoted and whether that alone makes the press release not prior art. They suggested that the face of the press release gives no indication or reason to assume it is solely reflects the inventor’s work.  The suggestion here is that a publication by someone other than an inventor will be assumed to be “by others” — shifting the burden to the patentee to at least present a prima facia case that the release was not by others. Thus, a central issue here is who bears the burden with respect to showing whether the release reflects “others” vs the inventors.

This issue was solved in the AIA with Section 102 no longer using the words “by others.” Still, we’ll be litigating lots of pre-AIA cases the next decade. A similar issue does arise under AIA 102(b) in terms of who has the burden of proving whether a disclosure was derived from the inventor.

William Peterson (MorganLewis) argued on behalf of the patentee and Chad Landmon (Axinn) on behalf of Norwich.  

Supreme Court Denies Certiorari in Three Patent Cases

Patent

The Supreme Court announced on Monday, January 8, 2024, it has denied certiorari petitions in three patent cases that we have been watching. This leaves the Federal Circuit rulings intact.  It also means that the court is unlikely to hear a patent case this term.

The first case is Intel Corp. v. Vidal, which challenged the Patent Trial and Appeal Board’s “Fintiv rule.” This policy allows the PTAB to use the director’s delegated discretion to deny inter partes review petitions if, for instance, parallel litigation in district court is progressing quickly. Intel argued the rule is arbitrary, overly restrictive, and skirted proper rulemaking procedures. But the Federal Circuit said decisions on whether to institute reviews cannot be appealed. Although the Supreme Court has declined to take-up the issue, Dir. Vidal has already narrowed the approach taken under Dir. Iancu and will potentially go further.

The second case, Realtime Data v. Fortinet, involved eligible subject matter under 35 U.S.C. 101. Realtime alleged the Federal Circuit had expanded eligibility exceptions too broadly and asked SCOTUS to reinforce that most inventions should qualify as patentable. However, the Court turned down Realtime’s appeal.

Finally, Traxcell Techs v. AT&T raised a narrow question on whether attorney’s fees can be awarded for “baseless” litigation actions taken after a magistrate judge’s recommendation but before final confirmation by the district judge. Here too though, the Supreme Court denied cert, leaving the Federal Circuit’s answer that “yes, fees were appropriate.” (paraphrasing).

With these three denials on widely-varying patent issues, the Court seems inclined to let CAFC precedent control in these areas for now.

There are still two pending petitions, with VirnetX having a much greater shot than Tehrani.

  • VirnetX Inc. v. Mangrove Partners Master Fund, Ltd., No. 23-315. The VirnetX petition focuses on the Federal Circuit’s interpretation of the inter partes review (“IPR”) joinder provisions and the requirements of the Federal Vacancies Reform Act (“FVRA”).  Both Cato and BIO filed briefs in support of the petition.
  • Tehrani v. Hamilton Technologies LLC, No. 23-575.  The petition raises issues of obviousness, expert qualifications, claim interpretation, etc.  I wrote previously that although the issues are super interesting, “the petition largely re-argues the evidence — typically a losing approach at the Supreme Court” petition stage.

Federal Funded Innovation and March-In Rights

Patent

by Dennis Crouch

The Biden Administration is seeking comment on its proposed framework for how how agencies should evaluate exercising “march-in rights” over federally funded inventions. For those familiar with march-in rights, this guidance has been a long time coming. While these powers have technically existed for years under the Bayh-Dole Act, the lack of clear procedures around their use has rendered them largely theoretical. This proposal could change that.

(more…)

Sharon Israel, PTO New Chief Policy Officer

Patent

Congratulations to Sharon Israel on her new leadership role at the USPTO.  I was happy to learn that Director Vidal has appointed Sharon Israel as its new Chief Policy Officer and Director for International Affairs. Ms. Israel has been a leader of the patent bar for many yeas and will bring tremendous expertise to this important role overseeing the USPTO’s policy and international programs.  For the past few years, she has been a partner at Shook Hardy focusing on patent litigation — primarily on the defense side. (more…)

Plagiarism Police come for Winston & Strawn

Patent

Hsuanyeh Law Group v. Winston & Strawn, 23-cv-11193 (S.D.N.Y. 2024)

A recent copyright infringement lawsuit filed by small Boston intellectual property boutique Hsuanyeh Law Group PC (HLG) against international giant Winston & Strawn LLP focuses a dividing line that can highlight when copying the work of another firm is permissible.  I believe that Winston & Strawn will eventually prevail based upon a fair use defense, but it is still an embarrassing situation for the firm and attorneys involved.  I hope that they did not overbill the client.  The role of attribution is also receiving increasing focus as attorneys begin to rely more heavily on AI outputs for their legal documents.

(more…)

Federal Circuit Affirms Invalidity of Genus Claims to Stevia Production Method Lacking Written Description and Narrower Claims as Combining Natural Phenomena with an Abstract Idea

Patent

by Dennis Crouch

In PureCircle USA Inc. v. SweeGen, Inc., No. 22-1946 (Fed. Cir. Jan. 2, 2024) (non-precedential) [PureCircle Decision], the Federal Circuit affirmed a district court summary judgment siding against the patentee, PureCircle.  The court concluded that the stevia production method claims were all invalid, either for: (1) lack of written description for the genus claim or (2) lack of eligibility because the claims are directed to a natural phenomenon combined with an abstract idea.  Judge Dyk authored the opinion of the court that was joined by Judges Schall and Stark affirming the ruling of C.D.Cal Judge James Selna.

The written description portion of the opinion parallels the Supreme Court’s 2023 Amgen decision that focused on the sibling doctrine of enablement. Although non-precedential, the eligibility portion appears important because of the way it combines prohibited eligibility categories and rules that method claims requiring a particular purity level are themselves an abstract idea absent requirement of specific steps on how that purity level is achieved.

(more…)

The First Precedential Patent Decision of 2024: Dexcom v. Abbott Diabetes Care

Patent

by Dennis Crouch

The U.S. Court of Appeals for the Federal Circuit has begun 2024 [2023] with its first precedential patent decision in DexCom, Inc. v. Abbott Diabetes Care, Inc., 2023-1795 (Fed. Cir. January 3, 2024).  In an opinion by Judge Stoll, the court affirmed a district court decision denying DexCom’s motion for a preliminary injunction. The patentee had requested an order barring Abbott from pursuing its IPR challenges – based upon a forum selection clause that was part of a prior settlement between the parties. Judges Dyk and Hughes were also on the panel.

(more…)

Patent Law Exam 2023: Are you Smarter than a Law Student?

Patent

by Dennis Crouch

The following is my patent law exam from this past semester. As in years past, the exam was worth less than half of the final grade because the students did other substantial work during the semester, including a major moot court competition.   Students were permitted access to their book/notes/internet, but were barred communications with another human during the exam.

This year’s exam is very loosely based upon an interesting patent that I found associated with the Tow Whee product created by Eric Landis.  See US11167164, US11731470, and US11724148.  But, the events described are entirely my creation.

= = =

(more…)

Coffee and Claim Construction: The Plain and Ordinary Meaning of “Barcode”

Patent

Guest Post by Jordan Duenckel. Jordan is a third-year law student at the University of Missouri and a registered patent agent. He has an extensive background in chemistry and food science.  

A recent Federal Circuit opinion, K-Fee v. Nespresso, 2022-2042, — F.4th — (Fed. Cir. Dec. 26, 2023), arises from an infringement suit filed by K-fee System GmbH against Nespresso USA, Inc. in the Central District of California and revives a coffee controversy. K-fee owns three related patents (the ‘176, ‘177, and ‘531 patents) concerning coffee capsules that display information via a “barcode” which is read by the coffee machine to control the beverage production process. The key dispute is over the meaning of “barcode” and whether there was any prosecution disclaimer.

The technology underlying the dispute is individual coffee pods that have a barcode located on the outer rim of the pod that the coffee machine can read to self-adjust temperature, water amount, and other characteristics to brew different types of coffee all without user input creating a “one touch” gourmet coffee maker. Depending on the pod, our Nespresso machine can make expresso, a double expresso for the wife, or just a cup of black coffee for me. 

K-fee owns U.S. Patent No. 10,858,176 and claim one reads in part:  

1. A method of making a coffee beverage comprising: 

providing an apparatus including a barcode reader; 

inserting a first portion capsule into the apparatus, the first portion capsule including . . . an opposing bottom side with a first barcode located on the bottom side, . . . ; 

reading the first barcode with the barcode reader; 

controlling a production process of a first coffee beverage based upon the reading of the first barcode; 

The initial issue is the plain and ordinary definition of a barcode as both parties agree that the plain and ordinary definition is appropriate but disagree about what that meaning is. The district court issued a claim construction order construing “barcode,” relying on statements K-fee made distinguishing certain prior art (Jarisch) during prosecution of a related European patent before the European Patent Office (EPO). Based on K-fee’s statements that Jarisch discloses a “bit code” rather than a barcode, the district court construed barcode to exclude the type of bit codes in Jarisch. The district court granted summary judgment of non-infringement to Nespresso, finding that its accused coffee capsules use a code identical to Jarisch’s bit codes.  

The Federal Circuit reviewed appeal of the claim construction de novo because the claim construction relied only on intrinsic evidence. The claims and specification did not define “barcode,” so the court looked to the prosecution history, specifically K-fee’s statements distinguishing the Jarisch reference before the European Patent Office. Specifically examined were what the statements would indicate to a person having ordinary skill in the art about the meaning of “barcode.” K-fee presented evidence consisting of quotes from technical publications describing “barcode” as a code with bars of varying widths. K-fee also explicitly stated “the [skilled artisan] at all times defines the term ‘barcode’ as a line code constructed of bars having variable widths.” Additional confirmation is in K-fee’s statement that standard UPC retail barcodes fall within the scope of its claims. Since K-fee did not describe anything about how retail barcodes encode data, this further indicates K-fee was focused only on the visual appearance of varying width bars when referring to “barcodes.” 

Judge Taranto concludes a skilled artisan would not understand K-fee’s statements as excluding all bit codes from the scope of “barcode.” He specifically points to K-fee explicitly stating that retail barcodes like UPC codes are barcodes, even though they contain binary code elements. Citing Phillips v. AWH Corp.,415 F.3d 1303, 1312-17 (Fed. Cir. 2005), Judge Taranto found that the ordinary meaning of “barcode” to a relevant artisan focuses on visual appearance – i.e. a linear sequence of visually non-uniform width bars and concluded that the district court erred in narrowing the ordinary meaning of “barcode” based on K-fee’s statements to the EPO.  

I am sympathetic to Nespresso’s concern that the focus on visual appearance as to ordinary meaning misses some of the nuance about what the barcodes actually represent and that a relevant artisan would consider their functional purpose. As construed by Judge Taranto, “varying-width visual appearance of the bars” is an extraordinarily broad claim construction that seems to expand the claim scope significantly compared to the more narrow district court construction.    

The corollary issue is whether K-fee’s statements to the EPO are disclaimer of claim scope. Nespresso alleges that K-fee’s statements to the EPO constitute surrender of claim scope that would include their Vertuo coffee pod product. The court notes disclaimer requires “clear and unmistakable” statements, unequivocally disavowing claim scope. Looking at K-fee’s EPO submissions, statements about bit codes being excluded from barcodes were ambiguous rather than clear. For example, K-fee said a barcode “can be, but is not necessarily, a bit code.” This directly contradicts disclaimer of all bit codes. 

Judge Taranto concludes that the prosecution history as a whole does not show K-fee clearly disclaimed any portion of the ordinary meaning of “barcode.” The only thing K-fee clearly distinguished was the Jarisch reference itself, which does not expressly disclose varying width bars. Multiple instances indicate some possible indicia that K-fee disclaimed some scope however, it was not “clear and unmistakeable” as required to find disclaimer.  Therefore, reversing the district court’s construction of “barcode” also necessitated reversing the summary judgment of non-infringement that was based entirely on the erroneous claim construction.

Patent Grant Total 2023

Patent

by Dennis Crouch

The US Patent and Trademark Office (USPTO) issued a total of 312,100 utility patents in the calendar year 2023. This marks the fourth consecutive year of decline in the number of issued patents. The 2022 figures show a 3% decrease from the previous year and a 12% decrease from the record-high numbers seen in 2019, as depicted in the chart below.  One of the biggest changes from 2022 to 2023 is that non-US patent applicants dropped from 51% of the total down to 48%. In fact, numbers from US-applicants increased over the past year.   There was a roughly parallel shift when looking at the % of patents naming a US inventor — up from 47% in 2022 to 50% in 2023.

It’s important to recognize that patent issuance in any given year is largely based on innovations and applications filed 2-5 years prior or more. For example, the 2023 decline reflects a drop in underlying patent filings, R&D, and new invention volume primarily from 2018 to 2020, with most applications pending examination for years before grant. Similarly, the 2022 and prior year patent volumes correlate most directly with late 2010s economic, policy and innovation landscapes. So this data is more of a backwards-looking snapshot. The drivers behind 2023’s applicant mix shift likely originated a few years back as well — established in the midst of the COVID pandemic. Though issuing patents now, the underlying applicant behaviors and investment decisions providing this US boost trace back to the 2020-2022 period or earlier based on typical application lag. Any analysis of the grant mix changes must recognize this context, and account for influencers at the time of filing rather than issuance to best understand the shift.

Rather than an economic indicator, the grant numbers and details surrounding them are (I believe) more reflective of the operation of the USPTO and the faith innovative companies have in the patent system.

 

Trademark Influencers and Aspen Mountain

Patent

by Dennis Crouch

I’m excited to head out to Snowmass in early January for the IP-SKI conference! Although we have the Ozarks here in mid-Missouri, there is nothing like the Rocky Mountains.  This year I’ll also have the opportunity once again to connect with other intellectual property lawyers and talk shop while enjoying some long runs. (LINK)

In the meantime, I came across an interesting lawsuit that Aspen Skiing Company (ASC) recently filed against ski apparel company Perfect Moment. ASC owns and operates the four famous ski resorts that make up Aspen Snowmass – Snowmass along with Aspen Mountain, Aspen Highlands, and Buttermilk, with a history stretching back to 1947. According to the complaint, ASC is suing Perfect Moment for trademark infringement, false association, unfair competition, and other claims. [Aspen Complaint]

The basic scoop here is that Perfect Moment conducted photo shoots on ASC properties to promote its skiwear, intentionally trading on ASC’s fame and reputation. Back in March 2021, Perfect Moment posted social media photos showing influencers posing in Perfect Moment apparel, with recognizable buildings, ski lifts, and trails of the ASC resorts in the background. ASC asserts such posts falsely imply an endorsement or sponsorship relationship. After a cease & desist letter, Perfect Moment removed some but not all of the photos.  More recently, Perfect Moment began selling jackets and pants bearing an image of people relaxing in at the Aspen “beach club,” complete with the signature red-and-white striped tents and lounge chairs on the mountain. The complaint seeks injunctive relief, destruction of the allegedly infringing apparel, and disgorgement of Perfect Moment’s profits.

Truthfully, the case here is a bit shaky, but courts have been known to strongly protect trademark holder rights. I expect that PM will quickly cave to the legal pressure, although I would suggest first sending in the influencers to the Federal Courthouse for a quick shoot with their winter attorney apparel.

Ian Saffer and Kate Bohmann from Quarles & Brady filed the lawsuit on behalf of Aspen. It does not appear that PM has been served yet.

Artificial Intelligence and Copyright in China: Lessons from a Recent Court Case

Patent

by Dennis Crouch

Thus far US copyright and patent tribunals have refused to award rights for AI generated works.  China has begun its move in the opposite direction with the recent decision granting rights to an artist who created an image using the popular generative AI system Stable Diffusion.  The case of Li v. Liu was decided by the recently Beijing Internet Court.  The court decides internet related cases using online tools. Although the court uses AI judges in some cases, this one was decided by humans.

[Read an English translation created by GWU Law Students Yuqian Wang and Jiaying Zhang supervised by Prof. Robert Brauneis: Li v Liu Beijing Internet Court 20231127 with English Translation. More AI related decisions are available at the GWU AI Litigation Database.]

The plaintiff, Li, used Stable Diffusion to generate a photorealistic image of an Asian woman. He shared the work on Xiaohongshu, a Chinese platform similar to Instagram. Later, the defendant Liu, a blogger, published the image in a blog post without Li’s permission, removing his username and platform watermark.

Li sued for copyright infringement. The Beijing Internet Court ultimately ruled in his favor, ordering Liu to apologize publicly, pay ¥500 ($72) in damages, and cover ¥50 ($7) in court fees.

Crucially, the court recognized Li as the legal rights-holder, having contributed the necessary “intellectual input” through choices of models, prompts, parameters, and final image selection. Judges emphasized that copyright law aims to encourage human creativity.

In this case, from the moment the Plaintiff conceived the disputed image to the moment the Plaintiff finally selected the disputed image, it can be seen that the Plaintiff has carried out a certain amount of intellectual input, such as designing the presentation of the character, selecting the prompts, arranging the order of the prompts, setting the relevant parameters, selecting which picture meets their expectations, and so on. . . . Currently, a new generation of generative AI technology is increasingly being used for creation. As long as AI-generated images reflect the original intellectual input of a person, they should be identified as a work and protected under copyright law.

This court ruling signals China’s interest in extending copyright law to better account for AI-generated content and also potentially places the country in the forefront of protecting AI creations.  Still, the Beijing Internet Court itself emphasized the approach of judging AI copyright issues based on the specific facts.

Of course, this is one regional lower court decision and is not generally a policy statement of the PRC.  The judges here particularly noted that the level of creative expression requires a case-by-case analysis.  In an email, Berkeley IP scholar Yuan Hao (郝元) points out, there is still debate within China on this issue. A similar case decided by a court in Shenzhen came to the opposite conclusion, finding AI-generated output eligible for copyright protection as the “intellectual fruits” of the AI developer rather than the AI user. According to Hao, cases like Li v. Liu feature “experimentalist practice” with different local courts exploring the issue before final guidance from the Supreme People’s Court.  Hao also disputes depictions of the case as a political move to strategically assist China’s AI industry. While acknowledging that some “political” IP cases may occur, she has not seen evidence of that here.  In my view, the low-value of the case (less than $100) also serves as an indication that this was not intended as a landmark decision setting national policy, but rather resolving a minor copyright dispute between two individuals.

 

Federal Circuit Appellate court Grants Emergency Stay of Apple Watch Ban

Patent

by Dennis Crouch

The patent battle between Masimo and Apple over pulse oximetry technology in the Apple Watch took a new turn on December 27th. Despite the recent import ban imposed by the U.S. International Trade Commission (ITC), Apple was granted a temporary stay by the U.S. Court of Appeals for the Federal Circuit. For now, this emergency ruling blocks the government from enforcing the exclusion order on certain Apple Watch models through at least mid-January. However, the legal fight is far from over. For Masimo, this short-term win for Apple weakens its bargaining position as the two companies continue their protracted patent dispute in courts and before regulatory agencies.

(more…)

Fed Cir affirms PTAB decision Invalidating 1996 Patent on Mobile Base Stations

Patent

by Dennis Crouch

In a non-precedential decision, the Federal Circuit has affirmed a set of PTAB decisions canceling the claims of four patents owned by Carucel Investments L.P. (“Carucel”) — finding them invalid as obvious under 35 U.S.C. § 103. See Carucel Invs. L.P. v. Vidal, Nos. 2021-1731 (Fed. Cir. Dec. 26, 2023). The affected Carucel patents include U.S. Patent Nos. 7,221,904; 7,848,701; 7,979,023; and 8,718,543, with priority back to a 1996 application filing. All four patents relate to mobile communication systems involving base stations that can be mounted on moving vehicles. Carucel v. Vidal Opinion.

The original focus of the invention involved a closed-loop rail system running alongside a highway and that carried mobile base stations moving in the direction of the flow of traffic. That focus of the invention was quickly scrapped – likely as impractical.  But, the disclosure was seen as sufficient to also cover movable base stations with no rail limitation — allowing mobile base stations that might be on the cars and other vehicles themselves.

Multiple petitioners, including Mercedes-Benz, Volkswagen, and Unified Patents filed petitions seeking inter partes review (“IPR”).  Relying on KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 406 (2007), the Patent Trial and Appeal Board (“PTAB”) instituted review and ultimately issued final written decisions concluding that the petitioners had proven by a preponderance of evidence that all challenged claims were unpatentable as obvious.

On appeal, Carucel disputed the PTAB’s claim constructions, obviousness determinations, and post-institution procedures under the Administrative Procedure Act (“APA”).  The Federal Circuit rejected Carucel’s arguments on all fronts.

Claim Construction: During inter partes review proceedings, the patentee is typically seeking a narrow construction of various terms in order to distinguish itself from the prior art. This has to be a careful argument — if the patentee goes too narrow then the accused infringers can also escape liability.

Here, the patent specification suggests that the mobile base stations are connected directly via cellular-network.  However, the claims themselves only use the terms “mobile device” and “mobile unit.” The court explained that neither the claim language nor the specifications justified restricting the scope to only cellular networks or requiring the mobile devices to directly register or communicate with the network.  In its analysis the court concluded first that the words “mobile device” refers to the capability of movement of a physical object and does not suggest the narrow construction requested.

On the obviousness determination, the Federal Circuit made the factual determination that a person of ordinary skill in the art would have been motivated to combine the teachings of the prior art with a reasonable expectation of success.  That determination quickly led to the legal conclusion that the claims were obvious.  On appeal, the Federal Circuit gives deference to PTAB fact finding under the substantial evidence standard. And here, the court found more than iota to support the conclusions — especially after deferring to the PTAB’s credibility findings favoring petitioner’s expert testimony.  At oral arguments, Brian Bear (Spencer Fane) argued that the Board had simply adopted the opposing expert testimony ipse dixit without providing critical analysis and, in particularly without explaining how the prior art combination overcame the “massive barrier” of incorporating the TDMA systems in some references alongside the CDMA systems in other references.   As with the PTAB decision, the Federal circuit decision does not provide a direct response or analysis regarding the TDMA/CDMA incompatibility issue.

Finally, the Federal circuit rejected Carucel’s argument that the PTAB’s denials of requests for Director Review violated the APA.  The denial orders themselves were unsigned, but still sufficiently identified the Commissioner Hirshfeld as the presiding officer.   In addition, the Director Review does not need to separately explain reasons for denial.  Although this is an agency action, the PTAB written decisions are “reviewable final decisions of the agency” despite intervening director denial.

Brian Bear of Spencer Fane argued the case for the patentee with Debra McComas of Haynes & Boone for appellees.  Michael Tyler from the PTO’s solicitor’s office also defended the opinions.  Judge Stark authored the unanimous opinion that was joined by Judges Dyk and Schall.

Emergency Appeal of the Apple Watch Ban

Patent

by Dennis Crouch

December 25th, marked the deadline for President Biden to reject the U.S. International Trade Commission’s (USITC) ruling banning imports of certain Apple Watch models. With no action from the White House, Apple now faces a federal government order to halt imports and sales of Apple Watch Series 9 and Ultra 2 devices because it incorporates light-based pulse oximetry technology covered by the claims of Masimo’s U.S. Patent Nos. 10,945,648 (claims 24 and 30) and 10,912,502 (claim 22).

(more…)

Guest post by Gugliuzza, Goodman, & Rebouché: Inequality and Intersectionality at the Federal Circuit

Patent

By: Paul Gugliuzza is a Professor of Law at Temple University Beasley School of Law, Jordana R. Goodman is an Assistant Professor of Law at Chicago-Kent College of Law and an innovator in residence at the Massachusetts Institute of Technology, and Rachel Rebouché is the Dean and the Peter J. Liacouras Professor of Law at Temple University Beasley School of Law. This post is part of a series by the Diversity Pilots Initiative, which advances inclusive innovation through rigorous research. The first blog in the series is here and resources from the first conference of the initiative are available here.

The ongoing reckonings with systemic racism and sexism in the United States might seem, on first glance, to have little to do with patent law. Yet scholarship on racial and gender inequality in the patent system is growing. Recent research has, for example, shown that women and people of color are underrepresented among patent-seeking inventors and among lawyers and agents at the PTO. In addition, scholars have explored racist and sexist norms baked into the content of patent law itself.

In a new article, we empirically examine racial and gender inequality in what is perhaps the highest-stakes area of patent law practice: appellate oral argument at the Federal Circuit.

Unlike many prior studies of inequality in the patent system, which look at race or gender in isolation, our article looks at race and gender in combination. The intersectional approach we deploy leads to several new insights that, we think, highlight the importance of getting beyond “single-axis categorizations of identity”—a point Kimberlé Crenshaw made when introducing the concept of intersectionality three decades ago.

The dataset we hand built and hand coded for our study includes information about the race and gender of over 2,500 attorneys who presented oral argument in a Federal Circuit patent case from 2010 through 2019—roughly 6,000 arguments in total. Our dataset is unique not only because it contains information about both race and gender but also because it includes information about case outcomes, which allows us to assess whether certain cohorts of attorneys win or lose more frequently at the Federal Circuit.

Perhaps unsurprisingly, we find that the bar arguing patent appeals at the Federal Circuit is overwhelmingly white, male, and white + male, as indicated on the three figures below, which break down, in a variety of ways, the gender and race of the lawyers who argued Federal Circuit patent cases during the decade covered by our study. (Note that the figures report the total number of arguments delivered by lawyers in each demographic category. Note also that the number of arguments we were able to code for the race of the arguing lawyer was slightly smaller than the number of arguments we were able to code for the gender of the arguing lawyer, so the total number of arguments reported on the figures differ slightly.)

Federal Circuit Patent Case Oral Arguments, 2010-2019

What is surprising, however, is that the racial and gender disparities illustrated above dwindle when we look only at arguments by lawyers appearing on behalf of the government, as shown on the three figures below, which limit our data only to arguments by government lawyers. (About 75% of those government arguments were by lawyers from the PTO Solicitor’s Office; the others came from a variety of agencies, including the ITC and various components of the DOJ.)

Federal Circuit Patent Case Oral Arguments, 2010-2019 – Government Lawyers Only

In fact, among lawyers appearing on behalf of the government, the proportion of arguments by women, people of color, and women of color exceeded the proportion of women, people of color, and women of color in the total population of practicing lawyers—that is, all lawyers, not just patent lawyers. Among private sector patent lawyers, by contrast, the proportion of arguments by women, people of color, and women of color was much lower than the proportion of women, people of color, and women of color in the total population of lawyers, as shown on the table below.

To restate those findings in a slightly different fashion: we find that, among lawyers arguing patent cases at the Federal Circuit, a government lawyer is 2.3 times more likely than a private-sector lawyer to be a person of color, over 5 times more likely to be a woman, and over 10 times more likely to be a woman of color.

Remarkably, the racial and gender disparities we find—particularly among Federal Circuit lawyers from the private sector—bear no relation to attorney performance. As we explain at length in our article, appellants in Federal Circuit patent cases win about a quarter of the time and appellees win about three-quarters of the time—with no significant differences based on race, gender, or the intersection of the two.

There is, however, one group of lawyers who do win more frequently than all others: a small group of 65 private-sector lawyers who argue patent cases at the Federal Circuit more than anyone else—on average, at least once a year. When seeking to overturn a judgment of a district court, the PTO, or the ITC in a patent case, those frequent Federal Circuit advocates succeed 41% of the time, as compared to a 24% win rate for the other private-sector lawyers in our dataset. That finding adds a patent-law angle to a growing literature documenting the remarkable influence a small group of specialist appellate litigators (mostly white and male, and almost all at the wealthiest, most prestigious law firms in the world) have had on the U.S. legal system.

We conclude our article with some ideas about how to make the patent system, and high-level law practice generally, more diverse and inclusive. In the main, we think our findings about the large proportion of women, people of color, and women of color arguing patent appeals for the government undercuts the oft-mentioned “pipeline” explanation for a lack of diversity in patent law—that is, the idea that women and people of color are absent because they lack scientific or technical backgrounds.

Not only is that explanation based on outmoded conceptions of what patent practice entails—especially patent litigation—our data suggest there are women, people of color, and women of color arguing patent cases at the highest level—they are just not getting many opportunities to do so in law firm practice. Indeed, though the number of government arguments in our dataset (567) is less than one-tenth the number of arguments by private-sector lawyers (5825), the government had a greater number of arguments presented by women of color (65) than the private sector did (60).

The inequalities we find among private-sector patent lawyers, and the lack of correlation between those inequalities and case outcomes, suggest that entry into the upper echelon of patent practice is about more than winning and losing in the courtroom. As a recent ABA report on “interrupting bias” suggests, to really make progress with race and gender equity, we must focus on the structural causes of disadvantage and exclusion. For instance, law firms can use concrete, objective metrics to track the effects of diversity efforts, to ensure promoting diversity is rewarded in performance reviews, and to ensure no demographic group is being treated differently in assignments, evaluation, and compensation.

In short, broadening the population of lawyers who make it to very top of appellate practice will require a more deliberate approach than “add diversity and stir”; it will require disrupting the rules and norms that exclude and undermine outsiders to the status quo.

Three main takeaways:

  1. Racial and Gender Disparities in Patent Law Practice: The study highlights that the demographic of attorneys arguing patent appeals at the Federal Circuit is predominantly white and male. This disparity is evident when compared to the total population of practicing lawyers. However, an interesting contrast is observed in government lawyers, where the proportion of arguments by women, people of color, and women of color exceeds their proportion in the overall lawyer population.
  2. No Difference Between Attorney Demographics and Case Outcomes: Despite the noted disparities in racial and gender representation, these factors do not correlate with the success rates in court. The data indicates that appellants in Federal Circuit patent cases win roughly a quarter of the time and appellees three-quarters of the time, irrespective of the attorney’s race, gender, or their intersection.
  3. Need for Structural Changes to Enhance Diversity: The post concludes that the disparities in private-sector patent law practice and the absence of correlation with case outcomes point to a need for more than just increasing diversity. There is a call for addressing structural causes of disadvantage and exclusion in the legal profession. This includes implementing concrete measures in law firms to track and promote diversity, ensuring fair treatment in assignments, evaluations, and compensation, and disrupting norms that perpetuate the status quo, thereby broadening the population of lawyers in top appellate practice.

If you find this insight compelling and want to stay informed on the latest developments, sign up for the DPI research updates today!