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The Reverse Doctrine of Equivalents: An “Anachronistic Exception” Lives Another Day
Detailed Return-to-Office Implementation Guidance: Potentially Major Disruption for USPTO Operations
Federal Circuit (Again) Upholds Ravgen’s Fetal DNA cffDNA Patent
Rocky Start for the USPTO under President Trump and Director Stewart
by Dennis Crouch
It is tough that one of the very first acts of new USPTO Director Coke Morgan Stewart’s was to cancel hiring for the agency. Two weeks ago I saw a notice that the USPTO expected to hire over 800 new examiners during 2025 in an attempt to address the ever growing backlog of unexamined patent applications. But, today the agency rescinded offers already given and cancelled its job ads. Although unclear, examiners still in their first year probationary period may also be let go. What we have here is the patent office being caught up in the larger political theatre with real world consequences — directly for those individuals losing promised employment and more generally for the intellectual property system as a whole.
This is the first time I have ever searched USAJobs and found nothing for the USPTO.
Still, this week the USPTO did not rescind the notices of allowances already mailed. And the patents issued on time at 12:01 am on Tuesday 1/21/25. This includes US12206106 and US12204163. These two are notable because they each list 28 inventors. One of the more interesting is US12205207, issued to Snap Inc. The ‘207 patent describes a system for automated image generation within a messaging or social media platform. The core innovation enables users to generate custom images directly within the platform’s interface by entering text prompts, which are then processed by an AI text-to-image generator to create multiple image options. Users can select from these generated images and immediately apply them as profile backgrounds, chat wallpapers, or media content backgrounds without leaving the platform.
1. A system comprising:
a memory that stores instructions; and
one or more processors configured by the instructions to perform operations comprising:
causing presentation, at a first user device associated with a first user of an interaction system, of a prompt selection interface of an interaction application provided by the interaction system, the interaction application enabling the first user to obtain automatically generated images and to interact with at least a second user of the interaction system;
receiving, from the first user device and via the prompt selection interface of the interaction application, an image generation request comprising a text prompt;
responsive to receiving the image generation request via the prompt selection interface of the interaction application, generating, via an automated text-to-image generator associated with the interaction system and based on the text prompt, an image;
causing presentation, at the first user device, of the image in an image selection interface of the interaction application;
receiving, from the first user device and via the image selection interface of the interaction application, an indication of user input to select the image; and responsive to receiving the indication of the user input to select, via the image selection interface of the interaction application, the image generated via the automated text-to-image generator: modifying, using the selected image generated via the automated text-to-image generator, a user image that is associated with the first user within the interaction system, and enabling the second user of the interaction system to be presented with the modified user image via the interaction application.
Heartbeat of the USPTO
Trading Technologies Files Supreme Court Petition on Patent Eligibility, Rule 60(b)(3), and Federal Circuit Procedural Issues
USPTO Faces Twin Challenges: Return-to-Office Mandate and Hiring Freeze Could Significantly Impact Patent Operations
Welcome USPTO Director Coke Morgan Stewart
Fast Track: Chinese Origin Patents Racing Through USPTO via PPH
Priority by Two Days: TTAB Grants Cancellation in Domain Name Dispute Turned Trademark Battle
by Dennis Crouch
As someone quite familiar with the subject matter, I was looking forward to writing about the trademark battle of Nerdio, Inc. v. NerdIO Limited. The appeal was recently dismissed based upon a joint stipulation, but I still wanted to dig into the TTAB file for a few nuggets. Nerdio, Inc. v. NerdIO Limited, Cancellation No. 92075281 (TTAB May 14, 2024). As the headline suggests, the mark was cancelled here based upon two days of prior use by the opposition.
Petitioner Nerdio, Inc. provides cloud-based IT services to small and mid-sized businesses under the NERDIO mark and the website getnerdio.com. Respondent NerdIO Limited is owned by Honk-Kong based Edmond Chow, who purchased the nerdio.com domain name in 1999 with stated plans to eventually commercialize it for software services. In May 2016, Nerdio’s predecessor attempted to purchase the nerdio.com domain from Chow through a series of escalating offers, sending twelve separate emails between May 4-27. Chow rejected these offers with a single reply stating “The domain is not for sale.” (The dollar values of the offers is confidential). After a final purchase attempt on June 8, 2016, Chow filed an intent-to-use application for the NERDIO mark the very next day (June 9, 2016). Registration No. 6153453 issued to NerdIO Limited on September 15, 2020, for various computer software related services. Meanwhile, after failing to acquire the domain, Nerdio’s predecessor launched its services at getnerdio.com and later petitioned to cancel Chow’s registration based on its alleged prior common law rights in the NERDIO mark.
First-in-Time: Just like the old fox case from property law, trademark priority is fundamentally based on a first-in-time principle. At common law, we’re looking for the first use of a mark in commerce, but the Lanham Act provides important constructive use rights for intent-to-use (ITU) applications. Under Section 7(c) of the Trademark Act, 15 U.S.C. § 1057(c), filing an ITU application establishes a nationwide constructive use date as of the application filing date, contingent upon eventual registration.
(c) Application to register mark considered constructive use.
Contingent on the registration of a mark on the principal register . . . the filing of the application to register such mark shall constitute constructive use of the mark, conferring a right of priority, nationwide in effect, on or in connection with the goods or services specified in the registration against . . .
This means that even though the applicant has not yet used the mark in commerce, once their mark registers, their priority rights will relate back to their application filing date. This constructive use right operates as a placeholder, effectively reserving priority from the application date against anyone who hasn’t used the mark before that date. However, if another party can prove actual use of the mark in commerce before the ITU application’s filing date, that party has superior rights. This operation is similar to the patent system where patent applications establish an inchoate right that becomes perfected upon patent issuance, trademark intent-to-use applications create a contingent priority right that becomes fixed when the mark registers. This concept also has historical parallels to the European doctrine of discovery in international law during the age of empires, where planting a flag could establish a preliminary claim to territory that would only become perfected through actual settlement and possession.
In Nerdio, Chow filed his intent-to-use in June 9, 2016 and eventually registered the trademark in the year 2000 — completing the requirement to establish the 2016 date.
Unfortunately for Chow, Nerdio Inc.’s predecessor (Adar IT) beat that date by two days via a June 7, 2016 email to its existing customers. The email informed these customers that the company had been “rebranded NERDIO.” Notice here that this email was not simply marketing, but was sent to actual customers who were already receiving IT services from the company. The TTAB found this significant because unlike other evidence of NERDIO usage (like the new website or promotional materials), this email was connected to actual services being rendered to paying customers.
In its decision, the TTAB found the email, combined with the context of ongoing service to these customers, established trademark use as of June 7 – just two days before NerdIO Limited’s June 9 intent-to-use application.
I couple of weeks earler, Nerdio Inc. had launched its getnerdio.com website – but the TTAB found that act was insufficient because it merely offered rather than rendered services. And, evidence of free trials starting June 2 failed because no trials actually began until after June 9. Similarly, social media promotion in early June showed only offers of service, not actual rendering. The TTAB cited Couture v. Playdom, Inc., 778 F.3d 1379 (Fed. Cir. 2015) for its conclusion that merely offering services is insufficient – the services must actually be rendered to constitute use in commerce.
Although Nerdio had a two day priority over Chow because of its prior use (via email to customers) – that priority does not settle the matter because common law use priority tends to be quite narrow in scope. When a party claims priority based on common law use against a registered mark, they must prove use of their mark for specific services that predate the registration’s priority date. This creates an important limitation – the prior user can only claim priority for the particular services they were actually providing before the critical date, not for related or expanded services they began offering later. While Nerdio Inc. proved it was providing certain IT services (monitoring computer systems, outsourced IT consulting, and implementing computer technologies) under the NERDIO mark two days before Chow’s filing date, the TTAB strictly limited Nerdio’s priority rights to just those three services even though though Nerdio later expanded to offer a broader range of services. Still, the Board found enough overlap to create a likelihood of confusion between Nerdio’s commercial offereings and Chow’s registration.
In the end, the TTAB granted Nerdio Inc.’s petition to cancel NerdIO Limited’s registration based on likelihood of confusion with Nerdio’s prior common law rights in the NERDIO mark. The key to this outcome was Nerdio’s ability to prove it was using the NERDIO mark for specific IT services two days before NerdIO Limited’s June 9, 2016 intent-to-use application date. The best evidence being an email to existing customers about the name change and continued provisioning of services to those customers.
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K&L Gates LLP represented Nerdio Inc. with a team led by Alexis Crawford Douglas. Ice Miller LLP defended NerdIO Limited with Jacqueline Lesser leading the representation.
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Federal Circuit: State Law Conversion Claim Preempted Where Pleading Seeks Patent-Like Protection
On January 13, 2025, the Federal Circuit issued a notable opinion on federal preemption of state law conversion (theft) claims and correction of inventorship. In BearBox LLC v. Lancium LLC, No. 2023-1922 (Fed. Cir. Jan. 13, 2025), the court affirmed the District of Delaware’s grant of summary judgment, holding that federal patent law preempted BearBox’s Louisiana state law conversion claim. The court also affirmed that BearBox failed to prove by clear and convincing evidence that Austin Storms should be listed as an inventor of U.S. Patent No. 10,608,433.
The dispute arose from a chance encounter at a Bitcoin mining conference in May 2019. After a brief conversation at cocktail hour and dinner between BearBox’s founder Austin Storms and Lancium’s co-founder Michael McNamara, Storms sent a single follow-up email with four attachments describing BearBox’s technology. Five months later, in October 2019, Lancium filed a patent application that ultimately issued as the ‘433 patent, naming McNamara and Raymond Cline as inventors, but not Storms. (Claim 1 is listed below). The patent covered methods and systems for adjusting power consumption based on power option agreements – a concept that BearBox claimed Storms had conceived and shared with Lancium at the conference. BearBox sued, asserting both correction of inventorship under federal patent law and conversion under Louisiana state law.
State Law Preemption: The preemption issue presents an important question about the intersection of state tort law and federal patent protection. While state law conversion claims are not automatically preempted by federal patent law, the Federal Circuit found that BearBox’s particular claim as pled sought “patent-like protection” for unpatented technology and thus ran afoul of longstanding Supreme Court precedent. The court relied heavily on Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141 (1989), which held that states may not offer patent-like protection to intellectual creations that would otherwise remain unprotected under federal law. The Bonito Boats Court emphasized that “the efficient operation of the federal patent system depends upon substantially free trade in publicly known, unpatented design and utilitarian conceptions.”
The Federal Circuit’s analysis focused on how BearBox pled its conversion claim, rather than the abstract elements of Louisiana conversion law. The court noted that BearBox’s complaint was “replete with ‘patent-like’ language typically invoked when a party asserts inventorship or infringement of a patent.” This included allegations that Storms had “conceived, developed, and reduced to practice” the technology and that Lancium had engaged in “improper and unauthorized use.” The prayer for relief seeking damages based on Lancium’s use and monetization of the technology particularly troubled the court, as it effectively sought patent-like remedies. Ultimately, the court concluded:
Here, we agree with the district court that BearBox’s conversion claim is preempted because the conversion claim, as pled, is essentially an inventorship cause of action and patent infringement cause of action, and thus seeks “patent-like protection” for ideas that are unprotected under federal law.
The court distinguished this case from situations where state law claims might validly protect against misappropriation without conflicting with federal patent policy. For instance, trade secret claims often survive preemption analysis, as the Supreme Court recognized in Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470 (1974). But here, BearBox’s technology was neither patented nor kept as a trade secret – instead, it was “freely shared with others” and “otherwise in the public domain.” The Federal Circuit emphasized that federal patent law generally precludes recovery for a defendant’s use of an unpatented discovery after the plaintiff makes it publicly available.*
What particularly doomed BearBox’s conversion claim was its attempt to recover damages analogous to patent remedies. The court noted that under Louisiana conversion law, damages are typically limited to return of the converted property or its value at the time of conversion. But BearBox sought ongoing royalties and lost profits – remedies that mirror 35 U.S.C. § 284’s provision for patent infringement damages. As the court explained, allowing such recovery would effectively grant BearBox patent-like control over technology it had freely disclosed, undermining Congress’s careful balance between innovation incentives and public access to ideas.
In my view, this decision is somewhat dangerous because of its potential to undermine state law cases that have protected individuals in idea-submission scenarios. Courts have long recognized claims where someone provides an idea to a company and seeks compensation when the company uses it without permission or payment These are typically tied into breach of (implied) contract or misappropriation as part of a confidential relationship. See, Desny v. Wilder, 46 Cal. 2d 715 (1956); Hoeltke v. C.M. Kemp Mfg. Co., 80 F.2d 912 (4th Cir. 1935); Aronson v. Quick Point Pencil Co., 440 U.S. 257 (1979). In Aronson, the Court upheld a contract requiring payment for use of an invention even after a patent application was rejected, distinguishing this from state law protection that would prevent others from using publicly available information. See also Softel, Inc. v. Dragon Med. & Sci. Communs., 118 F.3d 955 (2nd Cir. 1997); Nadel v. Play-By-Play Toys & Novelties, Inc., 208 F.3d 368 (2nd Cir. 2000).
* I want to note one procedural oddity here. The appellate court based its decision here at least partially on the factual finding that the technology here was not kept secret but instead had been “freely shared with others” and “otherwise in the public domain.” The district court made those conclusions following the bench trial on inventorship. But, the those facts were still in contention at the summary judgment stage when the district court decided the preemption issue. And, normally an appellate court reviews the summary judgment record independently, applying the same standards as the district court to determine whether summary judgment was appropriate. This issue probably deserves some additional research, but it is not clear to me that the court appropriately relied upon the publicly-available status of the submissions in its review of the summary judgment.
Inventorship Claims Fail Due to Lack of Clear and Convincing Evidence
Apart from the state law claim, BearBox also claimed inventorship rights under 35 U.S.C. § 256. That statute provides a court with authority to order correction of inventorship when it determines an inventor has been erroneously omitted from a patent. However, patent issuance creates a presumption that the named inventors are the true and only inventors, and the late-coming inventor faces the heavy burden of proving inventorship by clear and convincing evidence.
A key challenge for BearBox was the requirement that an alleged joint inventor’s testimony must be corroborated by independent evidence. As the Federal Circuit has long held, “an alleged co-inventor must supply evidence to corroborate his testimony.” Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456 (Fed. Cir. 1998). While corroborating evidence can take various forms – including contemporaneous documents, physical evidence, circumstantial evidence about the inventive process, or testimony from others – BearBox’s case rested primarily on four attachments sent in a single email: a product specification sheet, an annotated system diagram, hardware component specifications, and a data file modeling system simulation.
The district court’s analysis, which the Federal Circuit affirmed, found these materials insufficient to establish Storms’ inventorship claims. First, Storms himself admitted that the hardware component specifications had nothing to do with the subject matter of the ‘433 patent. More fundamentally, for the remaining documents, BearBox could not establish either that Storms had conceived of the claimed invention or that he had communicated any relevant information prior to Lancium’s independent conception. This timing issue proved particularly problematic because Lancium had filed a prior patent application in February 2018 – fifteen months before Storms ever met anyone from Lancium – disclosing many key aspects of the technology.
To qualify as a joint inventor, an individual must “show that he contributed significantly to the conception—the definite and permanent idea of the invention—or reduction to practice of at least one claim.” Blue Gentian, LLC v. Tristar Prod., Inc., 70 F.4th 1351 (Fed. Cir. 2023). These contributions must arise from “some element of joint behavior, such as collaboration or working under common direction.” Kimberly-Clark Corp. v. Procter & Gamble Distrib. Co., Inc., 973 F.2d 911 (Fed. Cir. 1992). The Federal Circuit found no error in the district court’s conclusion that the limited interaction between Storms and Lancium – essentially one dinner conversation and a single email – failed to establish the required level of collaboration or significant contribution to conception.
BearBox raised several procedural challenges to the district court’s inventorship analysis, but none proved persuasive. The Federal Circuit rejected BearBox’s argument that the district court improperly excluded as hearsay Storms’ testimony about what he told McNamara at dinner. While acknowledging some merit to the argument that the testimony was offered for a non-hearsay purpose (to prove notice rather than truth), the court found that BearBox’s failure to make an offer of proof about what the testimony would have been was “fatal” to preserving the issue for appeal.
The Federal Circuit also dismissed BearBox’s criticism of the district court’s element-by-element analysis of the patent claims. At oral arguments BearBox’s counsel argued:
All claims, or maybe most, the majority of claims, are a combination of known elements. And so, if the District Court is looking at the elements in isolation for evidence of earlier conception or conception, it will always be found.
While BearBox argued that the court should have considered claim elements in combination, the Federal Circuit found no error in the limitation-by-limitation approach given that BearBox needed to demonstrate Storms’ significant contribution to at least one claim. The court noted that this analysis actually mirrored how BearBox itself had presented its case in post-trial briefing.
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The appellate panel also affirmed the district court’s exclusion of Dr. McClellan’s supplemental expert report, which had been filed three weeks before trial and five months after the close of expert discovery.
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The Federal Circuit panel consisted of Judges Chen, Bryson, and Stoll, with Judge Stoll writing the opinion. The case was appealed from the District of Delaware where Judge Williams presided. Benjamin Horton argued the case for BearBox who was also represented by John Labbe, Chelsea Murray, and Raymond Ricordati of Marshall Gerstein. Mark Nelson argued for Lancium and was joined on the brief by other Barnes & Thornburg lawyers, including Adam Kaufmann and Chad Stover.
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Claim 1. A system comprising:
a set of computing systems, wherein the set of computing systems is configured to perform computational operations using power from a power grid;
a control system configured to:
monitor a set of conditions;
receive power option data based, at least in part, on a power option agreement, wherein the power option data specify: (i) a set of minimum power thresholds, and (ii) a set of time intervals, wherein each minimum power threshold in the set of minimum power thresholds is associated with a time interval in the set of time intervals;
responsive to receiving the power option data, determine a performance strategy for the set of computing systems based on a combination of at least a portion of the power option data and at least one condition in the set of conditions, wherein the performance strategy comprises a power consumption target for the set of computing systems for each time interval in the set of time intervals, wherein each power consumption target is equal to or greater than the minimum power threshold associated with each time interval; and
provide instructions to the set of computing systems to perform one or more computational operations based on the performance strategy.