March 2011

Patently-O Bits & Bytes by Lawrence Higgins

Patent,

HigginsFalse Marking Statute Found Unconstitutional

  • The Northern District of Ohio has found that the false marking statute (35 USC 292) is unconstitutional. [Link] Judge Polster applied the Morrison sufficient control analysis, and held the false marking statute invalid because the government lacks sufficient control to enable the President to "take Care that the Laws be faithfully executed. This case will surely be appealed to the CAFC and maybe even the Supreme Court. [Link] Already on appeal to the Federal Circuit is FLFMC, LLC v. Wham-O. In that case, Wham-O has argued that the statute is unconstitutional.

Motorola sues TiVo for patent infringement

  • Motorola contends that TiVo is infringing on patents that they acquired when they bought Imedia Corporation that are related to digital video recorders (DVR's). Motorola claims that the Imdeia Patents were filed in 1995 while; TiVo filed Patents were filed in 1998. The patents that Motorola obtained from Imedia are patent #'s 5,949,948, 6,304,714, and 6,356,708. Motorola asserts that the TiVo patent #'s 6,233,389 and 7,529,465 claim the same technology as their patents. [Link]

Is the patent backlog decreasing?

  • USPTO Commissioner for Patents Bob Stoll recently reported that the total backlog awaiting first office action by examiners decreased in February to 718,857 from 721,831 in January. Stoll also noted that there is a decline in the first action pendency time to an average of 24.2 months for January 2011 from 24.6 months in December 2010. Currently the USPTO has received over 11,000 more patents as compared to this time last year. [Link]

Sony Playstation 3 consoles seized after patent infringement suit

  • LG has won a preliminary injunction in Europe against Sony in a patent infringement suit. [Link]The injunction states that no shipments of the Playstation 3 can be shipped into Europe for at least 10 days. Also LG has filed a similar request with the US International Trade Commission, seeking to bar import of the Playstation 3. The complaint to the USITC alleges that Sony infringed at least one or more claims in US patent #'s 7,701,835, 7,577,080, 7,619,961 and 7,756,398 relating to the playback of Blue-ray Discs. [Link]

Patent Jobs:

  • Halcyon Molecular is seeking an IP strategist for their Silicon Valley location. [Link]
  • Life Technologies is looking for a Patent Attorney with 4-8 years experience and an EE or physics background. [Link]
  • McGinn IP Law Group is seeking a Patent Attorney with a BSEE. [Link]
  • ST-Ericsson is looking for an IP Attorney with more than 7 years experience to work at their Santa Clara location. [Link]

Upcoming Events:

  • Northwestern Journal of Technology and Intellectual Property will hold its 6th annual Symposium on Friday March 4th from 9am-5pm. The Symposium will discuss "The Economics of Intellectual Property and Technology," the keynote speaker will be Michael Fricklas. [Link] (Free Event, however CLE credit available for $200)
  • Berkeley Center for Law and Technology will hold an event on March 10th entitled, "Beyond Piracy: Managing Patent Risks in the New China." Presenters include Sharon Barner, Robert Merges, and Robert Barr to name a few. [Link]
  • The USPTO and USWCC will hold a Women's Entrepreneurship Symposium on March 11th. The event will be held at the USPTO headquarters in Alexandria, Va. The keynote speaker will be U.S. Senator Mary Landrieu will be the keynote speaker. [Link]
  • The George Washington University Law School will host an Intellectual Property Panel Symposium on March 18th. Guest panelists are Bruce Sewell, Mike Jacobson, John Whealan and Chief Judge Radar will be the keynote speaker. [Link]

Patently-O Bits & Bytes by Lawrence Higgins

Patent,

HigginsFalse Marking Statute Found Unconstitutional

  • The Northern District of Ohio has found that the false marking statute (35 USC 292) is unconstitutional. [Link] Judge Polster applied the Morrison sufficient control analysis, and held the false marking statute invalid because the government lacks sufficient control to enable the President to "take Care that the Laws be faithfully executed. This case will surely be appealed to the CAFC and maybe even the Supreme Court. [Link] Already on appeal to the Federal Circuit is FLFMC, LLC v. Wham-O. In that case, Wham-O has argued that the statute is unconstitutional.

Motorola sues TiVo for patent infringement

  • Motorola contends that TiVo is infringing on patents that they acquired when they bought Imedia Corporation that are related to digital video recorders (DVR's). Motorola claims that the Imdeia Patents were filed in 1995 while; TiVo filed Patents were filed in 1998. The patents that Motorola obtained from Imedia are patent #'s 5,949,948, 6,304,714, and 6,356,708. Motorola asserts that the TiVo patent #'s 6,233,389 and 7,529,465 claim the same technology as their patents. [Link]

Is the patent backlog decreasing?

  • USPTO Commissioner for Patents Bob Stoll recently reported that the total backlog awaiting first office action by examiners decreased in February to 718,857 from 721,831 in January. Stoll also noted that there is a decline in the first action pendency time to an average of 24.2 months for January 2011 from 24.6 months in December 2010. Currently the USPTO has received over 11,000 more patents as compared to this time last year. [Link]

Sony Playstation 3 consoles seized after patent infringement suit

  • LG has won a preliminary injunction in Europe against Sony in a patent infringement suit. [Link]The injunction states that no shipments of the Playstation 3 can be shipped into Europe for at least 10 days. Also LG has filed a similar request with the US International Trade Commission, seeking to bar import of the Playstation 3. The complaint to the USITC alleges that Sony infringed at least one or more claims in US patent #'s 7,701,835, 7,577,080, 7,619,961 and 7,756,398 relating to the playback of Blue-ray Discs. [Link]

Patent Jobs:

  • Halcyon Molecular is seeking an IP strategist for their Silicon Valley location. [Link]
  • Life Technologies is looking for a Patent Attorney with 4-8 years experience and an EE or physics background. [Link]
  • McGinn IP Law Group is seeking a Patent Attorney with a BSEE. [Link]
  • ST-Ericsson is looking for an IP Attorney with more than 7 years experience to work at their Santa Clara location. [Link]

Upcoming Events:

  • Northwestern Journal of Technology and Intellectual Property will hold its 6th annual Symposium on Friday March 4th from 9am-5pm. The Symposium will discuss "The Economics of Intellectual Property and Technology," the keynote speaker will be Michael Fricklas. [Link] (Free Event, however CLE credit available for $200)
  • Berkeley Center for Law and Technology will hold an event on March 10th entitled, "Beyond Piracy: Managing Patent Risks in the New China." Presenters include Sharon Barner, Robert Merges, and Robert Barr to name a few. [Link]
  • The USPTO and USWCC will hold a Women's Entrepreneurship Symposium on March 11th. The event will be held at the USPTO headquarters in Alexandria, Va. The keynote speaker will be U.S. Senator Mary Landrieu will be the keynote speaker. [Link]
  • The George Washington University Law School will host an Intellectual Property Panel Symposium on March 18th. Guest panelists are Bruce Sewell, Mike Jacobson, John Whealan and Chief Judge Radar will be the keynote speaker. [Link]

Patently-O Bits & Bytes by Lawrence Higgins

Patent,

HigginsFalse Marking Statute Found Unconstitutional

  • The Northern District of Ohio has found that the false marking statute (35 USC 292) is unconstitutional. [Link] Judge Polster applied the Morrison sufficient control analysis, and held the false marking statute invalid because the government lacks sufficient control to enable the President to "take Care that the Laws be faithfully executed. This case will surely be appealed to the CAFC and maybe even the Supreme Court. [Link] Already on appeal to the Federal Circuit is FLFMC, LLC v. Wham-O. In that case, Wham-O has argued that the statute is unconstitutional.

Motorola sues TiVo for patent infringement

  • Motorola contends that TiVo is infringing on patents that they acquired when they bought Imedia Corporation that are related to digital video recorders (DVR's). Motorola claims that the Imdeia Patents were filed in 1995 while; TiVo filed Patents were filed in 1998. The patents that Motorola obtained from Imedia are patent #'s 5,949,948, 6,304,714, and 6,356,708. Motorola asserts that the TiVo patent #'s 6,233,389 and 7,529,465 claim the same technology as their patents. [Link]

Is the patent backlog decreasing?

  • USPTO Commissioner for Patents Bob Stoll recently reported that the total backlog awaiting first office action by examiners decreased in February to 718,857 from 721,831 in January. Stoll also noted that there is a decline in the first action pendency time to an average of 24.2 months for January 2011 from 24.6 months in December 2010. Currently the USPTO has received over 11,000 more patents as compared to this time last year. [Link]

Sony Playstation 3 consoles seized after patent infringement suit

  • LG has won a preliminary injunction in Europe against Sony in a patent infringement suit. [Link]The injunction states that no shipments of the Playstation 3 can be shipped into Europe for at least 10 days. Also LG has filed a similar request with the US International Trade Commission, seeking to bar import of the Playstation 3. The complaint to the USITC alleges that Sony infringed at least one or more claims in US patent #'s 7,701,835, 7,577,080, 7,619,961 and 7,756,398 relating to the playback of Blue-ray Discs. [Link]

Patent Jobs:

  • Halcyon Molecular is seeking an IP strategist for their Silicon Valley location. [Link]
  • Life Technologies is looking for a Patent Attorney with 4-8 years experience and an EE or physics background. [Link]
  • McGinn IP Law Group is seeking a Patent Attorney with a BSEE. [Link]
  • ST-Ericsson is looking for an IP Attorney with more than 7 years experience to work at their Santa Clara location. [Link]

Upcoming Events:

  • Northwestern Journal of Technology and Intellectual Property will hold its 6th annual Symposium on Friday March 4th from 9am-5pm. The Symposium will discuss "The Economics of Intellectual Property and Technology," the keynote speaker will be Michael Fricklas. [Link] (Free Event, however CLE credit available for $200)
  • Berkeley Center for Law and Technology will hold an event on March 10th entitled, "Beyond Piracy: Managing Patent Risks in the New China." Presenters include Sharon Barner, Robert Merges, and Robert Barr to name a few. [Link]
  • The USPTO and USWCC will hold a Women's Entrepreneurship Symposium on March 11th. The event will be held at the USPTO headquarters in Alexandria, Va. The keynote speaker will be U.S. Senator Mary Landrieu will be the keynote speaker. [Link]
  • The George Washington University Law School will host an Intellectual Property Panel Symposium on March 18th. Guest panelists are Bruce Sewell, Mike Jacobson, John Whealan and Chief Judge Radar will be the keynote speaker. [Link]

Patent Damages and the Need for Reform

Patent

This is a guest Post by Michael J. Mazzeo, Jonathan Hillel and Samantha Zyontz[1]

Our analysis of a new dataset challenges the assumptions on which the Patent Reform Act is based and questions the need for damages law reform. Damages provisions of the Patent Reform Act, the latest version of which was recently introduced for vote in the Senate, are premised on concerns that awards are “too often excessive”[2] and those large verdicts featured in media headlines “represent the tip of the iceberg” of excessive awards.[3] Last week at the inaugural Samsung-Stanford Patent Remedies Conference, we presented a very different picture of patent infringement damages.

In our prize-winning study, “Are Patent Infringement Awards Excessive?: The Data Behind The Patent Reform Debate”, we compile a dataset comprising infringement awards from over 300 cases decided in US federal courts between 1995 and 2008. We build on a proprietary dataset from PricewaterhouseCoopers, supplementing it with information about the litigants, lawsuits and economic value of the patents-at-issue. Using standard statistical techniques and regression analysis, we search for evidence of “excessive” awards. Certain of our key findings are summarized below:

1. The eight largest awards represent nearly half of the total amount of damages in our dataset. As shown below, the distribution of damages is highly skewed, and awards in the largest eight cases represent over 47% of cumulative damages.

Mazzeo1

2. Patent infringement damages are highly predictable. We perform an 80-variable log-linear regression analysis that explains nearly 75% of the variation in the observed awards. As shown below, the first-order results of our regression indicate that juries and large defendants are correlated with higher awards.

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Filing-Date-Focused-System – The Key is the Scope of the Grace Period

Patent

[Update] A vote on S.23 is expected this evening, March 2, 2011. Before becoming law, the bill would need to also be approved by the House of Representatives.

I want to thank Professor McCrackin and her students for providing a useful analysis that compares the patent-race issues involved with the move to a first-to-file system.

I have long maintained that pressure to move to first-to-file has very little to do with these patent races. Interferences are extremely rare. And, as we all know, if it is difficult to prove prior dates of conception and reduction to practice, it is all-but-impossible to prove diligence at the level required by caselaw. Thus, in the words of Paul Morgan, analyzing the change in terms of the patent race is a "truly academic exercise."

For this reason, in my 2010 article on anticipation I decided to move the nomenclature away from first-to-invent and first-to-file systems and instead talk about whether the patent system is filing-date-focused or invention-date-focused and also to query the type of grace period allowed by the various systems.

What few are talking about with the proposed legislation is that it would increase the scope of prior art available to invalidate a patent – even when no competing patent application is filed.

In particular, the proposed legislation severely restricts the one-year grace period currently available to a patent applicant. Under the new legislation, a prior inventor could only antedate a pre-filing disclosure if that disclosure was (1) derived from the inventor or (2) made public after the inventor publicized her invention. Under the current rules, the one-year grace period operates without regard to the source of the putative prior art.

Even more, under current law, sales and offers-to-sell only constitute prior art if those sales occurred more than one year before the patent application filing date. 35 U.S.C. § 102(b). In those circumstances, no "swearing behind" is necessary against sales activities because they only qualify as prior art if they occurred outside of the grace period. It appears from the language of the bill, that no grace period would be allowed for pre-filing sales activities. Rather, the grace period language in the proposed bill only relates to "disclosures" and on sale activity is typically not seen as a disclosure.

From a practical standpoint, these elements involving the grace period are much more likely to impact patent applicants than any potential interference issue.

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Comparison of the Current U.S. First-to-Invent System with the First-Inventor-To-File System Proposed in the Patent Reform Act of 2011 (S.23)

Patent,

Guest Post By Prof. Ann McCrackin, Stephen Brodsky, and Amrita Chiluwal. Prof. McCrackin is Director of the Patent Prosecution Program at the Univ. of New Hampshire School of Law (formerly Franklin Pierce Law Center). Mr. Brodsky and Ms. Chiluwal are both 2011 JD Candidates at the Univ. of New Hampshire School of Law.

The Patent Reform Act of 2011 ("S.23") is now being considered by the full U.S. Senate. One of the provisions of S.23 would replace the current first-to-invent ("FTI") system with a first-inventor-to-file ("FITF") system. Some of the differences between these two systems are outlined below in order to help understand the changes in Sec. 2 of the S.23 Bill. For simplified illustrative purposes, Parties ("A" and "B") and their invention ("Widget") will be used below.

First-to-Invent

The current U.S. system is a first-to-invent ("FTI") system. Under the FTI system, the first party to invent is entitled a patent on that invention upon filing for a patent application (as long as all of the other patentability requirements are met). Even if the first party to invent is not the first to file, that party could still be entitled to the patent rights. In situations where there are multiple inventors of the same invention, the determination as to who is entitled to the patent rights is made during an interference proceeding. Interference proceedings are administrative proceedings held at the USPTO that legally determine the first inventor. However, there are time constraints on interference proceedings, e.g., typically a party cannot bring an interference proceeding on an invention after a patent has issued on that patent. Therefore, the first person to file would get the patent unless another person is able to prove prior invention in an interference proceeding.

The following examples involve two parties who claim the same invention in an FTI system:

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Patent Reform – An Important Amendment to the Bill

Patent,

The Senate is today considering the Patent Reform Act of 2011, with the proviso that the legislation is now being termed the “America Invents Act of 2011.” A major element of the bill would eliminate first-to-invent rights and also eliminate any pre-filing grace period except for inventor-derived disclosures (and post-inventor disclosure disclosures). In several ways, the legal reforms would move US law closer to the rest-of-the-world (ROW) by primarily basing patent rights on the date that a patent application is filed rather than the date of invention.

Anti-Harmonization: In noting a major deficiency in the bill, Hal Wegner has expressed concern that the unfortunate end result is anti-harmonization. The particular concern is the question of when “secret” prior art (today termed 102(e) prior art) is available for obviousness (or inventive step) analysis.

In the European and proposed US first-to-file system, when two individuals independently make the same advance, only the first-inventor-to-file the patent application will receive a patent on that invention. However, it is actually quite rare that the second-filed application’s claim set will be entirely anticipated by the previously filed disclosure. The big question then is not novelty, but rather obviousness (or inventive step) – do the claims in the second-filed application present an inventive step over the prior art? In Europe and the ROW, the first-filed patent application can only be used for novelty analysis and is not applied to the question of obviousness unless that first-filed application was otherwise published. Under the new US bill, however, these unpublished, secret filings would be used both for novelty and obviousness grounds.

An Example: To be clear, the issue arises when Inventor-A files a patent application and then, a few months later, Inventor-B files a patent application claiming a similar (but different) invention. It is usually the case that (1) Inventor-A will not immediately publicize its invention and (2) the first-filed application will not be published until 18-months after its filing. Under the proposed system, Inventor-B’s patent could be blocked on obviousness grounds based on Inventor-A’s application. In Europe and Japan, however, the earlier filed application would not be used in the obviousness (inventive step) analysis unless published prior to Inventor-B’s application date.

Thus, under our current invention-date-focused system, some inventions are patentable in the US that would not be patentable in Europe and Japan. On the flip-side, once the bill is passed, there will be a new set of inventions that are patentable in Europe and Japan, but not patentable in the US.

Importance: This issue turns out to be important in a fairly large number of cases. In a recent study, I found that, on average, US patents cite to about 5.5 references that conform to this situation – i.e., the average patent in my study cited to 5.5 other patent applications that were on-file prior to the filing of the patent application under examination but were not published until afterwards. The legal question for examiners is whether those references should be considered only for novelty grounds or if obviousness should be a consideration as well.

I do not know the answer to the question of whether the proposed US system is better or worse than the current European system. I do know, however, is that the US proposal does not harmonize those laws and may tend to frustrate US applicants by offering a lower bar to patentability in Europe than in their home country.

A Framework for Analysis: The Supreme Court’s 2007 decision in KSR v. Teleflex offers one framework for analysis. That case talked about a common sense approach to obviousness analysis – both in choosing prior art references to consider and in applying those references against the proposed invention. The common sense framework suggests that we not consider prior art references that could not have been accessible to someone of ordinary skill in the art. In this situation, these previously-filed applications were, by definition, kept secret within the Patent Office and not published elsewhere. Under those conditions, a common sense approach would exclude those when determining the level of ordinary skill in the art.

If the fix is to eliminate this secret prior art from obviousness analysis, the solution is a simple three-line amendment to the proposed legislation.