March 2005

Snippets: Review of Developments in Intellectual Property Law

Articles and Publications, Patent,

MBHB’s snippetsTM newsletter provides a timely review of developments in intellectual property law. Here is a table of contents of the most recent issue (March 2005: Volume 3, Issue 1):

  1. Daniel Boehnen and Deana Larkin, Trends in E-Discovery: New Local Rules and Recent Judicial Opinions.
  2. Michael Greenfield, Jennifer Pope, Dennis Crouch, and Elaine Chang, The Primary Source for Claim Construction: Dictionary or Specification.
  3. Kevin Noonan, The Continued Confusion Over Written Description.
  4. Dennis Crouch and Baltazar Gomez, Legislative Update: Joint Research Agreements May Protect Patent Rights.

You can e-mail the editor (snippets@mbhb.com) to receive a PDF copy of the newsletter.  Include your mailing address if you would like a hard-copy.  In the e-mail, please indicate your technology and legal interest: (Biotech, Electrical, Software, Chemical, Mechanical, Litigation, and/or Prosecution). 

Past Issues:

Congress Discusses Which Court Should Hear Patent Cases

Patent, Patent Legislation

The AIPLA is supporting a measure to legislatively overrule the 2002 Supreme Court case of Holmes Group v. Vornado.  The House Subcommittee on Courts, the Internet, and Intellectual Property is holding a hearing today to discuss the matter. 

Specifically, the AIPLA argues that the holding will allow regional circuits and even state courts to begin to hear patent counterclaims.  This scenario was suggested by the Indiana Supreme Court ruling in Green v. Hendrickson Publishers, Inc., 770 NE2d 784, 63 USPQ2d 1852 (< ?xml:namespace prefix ="" st1 />Ind. 2002).  In moderation, the AIPLA believes that if patent claims are raised in a compulsory counterclaim then the Federal Circuit should have jurisdiction.  On the other hand, if the patent claims are raised in a permissive counterclaim then the regional circuit or state court should have jurisdiction. 

The Subcommittee hearing is scheduled for 3:30 p.m. Eastern and will be broadcast over the Internet here.  Those testifying include Edward Reines on behalf of the Federal Circuit Bar Association; Professor Arthur Hellman from the University of Pittsburgh School of Law and expert on the structure of the Courts; Sanjay Prasad, Chief Patent Counsel for Oracle Corporation, and Meredith Martin Addy from Brinks Hofer.

Although the cameras would normally be focused tightly on the patent hearing, as Matthew Buchanan points out, MLB is also testifying today on the Hill.

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CAFC: Ordinary Meaning Defined By Context of Written Description

Patent, Patent Cases 2005

PatentlyO060Medrad v. MRI Devices (Fed. Cir. 2005).

Medrad filed suit against MRI Devices for allegedly infringing Medrad’s patented radio frequency (RF) coils used in magnetic resonance imaging (MRI).  The district court granted a partial summary judgment of invalidity after construing the claims of the patent.

On appeal, the CAFC struggled to give meaning to a claim that “itself provides little guidance.”

Interpreting the term “substantially uniform,” the court rejected Medrad’s argument that the “court may not look to how an invention functions in determining the meaning of claim terms” — finding that proposition “as unsound as it is sweeping.”

We cannot look at the ordinary meaning of the term . . . in a vacuum. Rather, we must look at the ordinary meaning in the context of the written description and the prosecution history. Quoting DeMarini Sport (Fed. Cir. 2001).

Basing its decision on (1) claim language, (2) the specification, and (3) expert testimony, the appellate court found that “substantially uniform” in reference to a magnetic field meant that the magnetic field is sufficiently uniform to obtain useful MRI images.

Affirmed.

 

Intellectual Property Podcasting

Articles and Publications, Patent

Podcasting is catching on as an extension of the blog.  According to the Wikipedia, a podcast is like an audio magazine subscription: a subscriber receives regular audio programs delivered via the Internet, and can listen to them at their leisure.

Podcasts differ from traditional Internet audio in two important ways. In the past, listeners have had to either tune in to web radio on a schedule, or they have had to search for and download individual files from web pages. Podcasts are much easier to get. They can be listened to at any time because a copy is on the listener’s computer or portable music player (hence the "pod" in "podcasting"), and they are automatically delivered to subscribers, so no active downloading is required.

Using podcast technology, for instance, a podcasting program can automatically download new .mp3 files from your favorite blog.  Of course, you can always just click on the .mp3 broadcast from your browser and listen to the podcast through your computer’s speakers.

So far, I know of three podcasting groups in the IP world so far:

Look for the inaugural Patently-O Podcast coming next month.

Aside: Since I am discussing blogging, I would recommend purchasing the newest version of Blogjet.  It is great and integrates very nicely with Typepad.

CAFC: Claims Construed Based on Specification and Prosecution ‘Read as a Whole’

Patent, Patent Cases 2005

ASM America v. Genus (Fed. Cir. 2005)

In a dispute over a method of sequential atomic layer deposition (ALD), ASM sued Genus for infringement of its patents.  After construing the claims, the magistrate granted summary judgment of non-infringement in favor of Genus.  ASM appealed the construction.

On appeal, the CAFC affirmed, finding that the district court was "on firm ground." 

The disputed construction involved the term "evacuate."   ASM argued that evacuate should encompass use of an inert gas to push gases out.  However, the Appellate Panel found that, "when the specification and the prosecution history are read as a whole, it becomes clear that the insertion of inert gas may help render the process of evacuation more efficient, but is not part of the evacuation itself."

Summary judgment of non-infringement affirmed.

Appeals Court Partially Reverses eBay Patent Case: Setting the Stage for a Permanent Injunction

Patent, Patent Cases 2005,

Patentlyo058

MercExchange v. eBay (Fed. Cir. 2005)

by Dennis Crouch

At the district court level, Thomas Woolston, creator of the MercExchange and Patently-O Reader, won a $35 million patent infringement suit against eBay for infringement of his patents covering live internet auctions.  On March 16, 2005, the Federal Circuit released its decision on appeal, reversing the decision in-part, but setting the stage for a permanent injunction against eBay.

On appeal, the Federal Circuit partially overturned the district court’s decision, finding that at least one of the MercExchange patents invalid but vacating the lower court’s ruling that another patent was invalid.

Perhaps most importantly, MercExchange challenged the district court’s refusal to issue a permanent injunction against eBay’s use of the invention.  The CAFC agreed with MercExchange, that the district court “did not provide any persuasive reason that this case is sufficiently exceptional to justify the denial of a permanent injunction.”  Specifically, the CAFC found that the fact that MercExchange expressed a willingness to license was not a valid reason for depriving it of the right to an injunction to which it would otherwise be entitled.

If the injunction gives the patentee additional leverage in licensing, that is a natural consequence of the right to exclude and not an inappropriate reward to a party that does not intend to compete in the marketplace with potential infringers. . . . We therefore see no reason to depart from the general rule that courts will issue permanent injunctions against patent infringement absent exceptional circumstances.

Of course, there is only a very small likelihood that eBay would allow its servers to be shut-down rather than settle the case.  In addition, it is unclear how an injunction would operate in this case, although it would most likely only alter e-bay’s ‘buy it now’ feature.

Finally, the appellate panel affirmed the portion of the judgment denying an award of enhanced damages or attorney fees for MercExchange.

AFFIRMED IN PART, REVERSED IN PART, VACATED IN PART, and REMANDED.

The MercExchange patents are also under reexamination at the Patent Office.  However, if the litigation concludes before the reexam is complete, there is some question as to whether the reexam can be used by eBay to re-open the case.  One issue stems from the 1803 case of Marbury v. Madison where the Supreme Court held that the Judiciary, not the Executive Branch that determined the law.  In this case, the PTO (Executive Branch) would be telling the Judiciary to change its mind.

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March 16, 2005 04:02 PM US Eastern Timezone

eBay Statement on U.S. Court of Appeals Ruling in MercExchange Case

SAN JOSE, Calif.–(BUSINESS WIRE)–March 16, 2005–eBay (Nasdaq:EBAY) is pleased with today’s decision by the U.S. Court of Appeals that invalidates one of MercExchange’s patents, and as a result, throws out all the related damages. Looking forward, we believe that any injunction that might be issued by the District Court with respect to the other patent will not have an impact on our business because of changes we have made following the District Court’s original verdict. The U.S. Patent and Trademark Office is actively reexamining all of MercExchange’s patents, having found that substantial questions exist regarding the validity of MercExchange’s claims. The Patent and Trademark office has already initially rejected all of the claims of one of MercExchange’s patents. We are confident in our position against MercExchange and do not believe that these matters will have any impact on our business.

BlackBerry lawsuit settles for $450M US: Patent Law Questions Remain

Patent, Patent Cases 2005

The legal saga involving NTP’s patents covering Research-In-Motion’s BlackBerry (R) technology appears to be over. According to news reports, RIM has settled the BlackBerry Lawsuit for $450M (US). 

The lawsuit did produce what appears to be an expansion of U.S. patent laws to cover infringing activity that partially occurs on foreign soil.  However, the settlement leaves a number of open questions regarding application of the newly expanded theory of liability. 

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NOTE: The drawing above was used in RIM’s brief at the U.S. Federal Circuit Court of Appeals to graphically show how a substantial portion of the ‘infringing’ activity occurred on foreign soil.  The Court rejected RIM’s argument that activity across the border could not create liability under the U.S. patent laws.

CAFC: References on Face of Patent are Intrinsic Evidence for Claim Construction

Patent, Patent Cases 2005

Inline_skate

V-Formation v. Benetton Group & Rollerblade, Inc. (Fed. Cir. 2005).

By Marcus Thymian

In its March 15 decision, the Federal Circuit affirmed a district court’s grant of summary judgment of non-infringement of the claims of three patents relating to in-line skate technology.  The patents were directed to a particular frame design for attaching the wheels to the boot.  To provide flexibility in frame and wheel adjustment of a skate, the frame included two sidewalls “releasably attached” by a plurality of fasteners to toe and heel plates of the skate.   (For example, see U.S. Patent No. 5,873,584).

The dispute centered on whether rivets could serve as fasteners that “releasably attach.”  The embodiments set forth in the patents-in-suit utilized screws as the releasably attaching fasteners.  The district court had construed the term “releasably attaching” to mean that the fasteners “must permit the sidewalls to be easily removed and replaced” and determined that one skilled in the art would not consider rivets to fall under that definition.  In reaching that conclusion, the district court looked to the specification of the patents-in-suit, as well as the specification of a patent (the “Meibock patent”) cited on the face of one of the patents-in-suit.  Finally, the district court supported its construction by referring to an uncontrolling decision of the Federal Circuit that interestingly addressed the unremovable nature of rivets in in-line skates:  “Screws, unlike rivets and laminates, are meant to be unscrewed, that is, to be removed.  A rivet or a laminate, to the contrary, is meant to remain permanent, unremovable unless one is bent on breaking the permanent structure apart.”

The Federal Circuit first agreed that the intrinsic evidence called for “releasably attaching” to be construed per the district court’s definition.  It agreed that the intrinsic evidence included not only the patent specification, but also the cited Meibock patent:

    The district court properly considered other intrinsic evidence to aid its construction.  For instance, the district court considered [the Meibock patent].  The Meibock patent is prior art that was listed as a reference on the face of the ‘466 patent and in an Information Disclosure Statement.  This prior art reference to Meibock is not extrinsic evidence.  This court has established that “prior art cited in a patent or cited in the prosecution history of the patent constitutes intrinsic evidence. …  The Meibock patent explains that the toe and heel plates are “permanently attached … through the use of rivets or releasably attached through the use of fasteners such as screws or bolts.” …  Thus, the district court correctly concluded:  “[The] Meibock patent provides evidence that rivets are considered by persons of ordinary skill to be permanent fasteners.”

Finally, the Federal Circuit approved of the district court’s reference to its earlier uncontrolling decision addressing the removability of rivets, since the district court had merely used it to supports its independent conclusion in this case.

Marcus Thymian is a partner at McDonnell Boehnen Hulbert & Berghoff LLP in Chicago. Mr. Thymian is experienced in planning, creating, enforcing, and defending against patent portfolios, and has logged many miles on in-line skates over the past 20 years. [link to bio]

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