December 2013

Next Step in Patent Reform

By Dennis Crouch

With the passage of the Goodlatte Innovation Act (H.R. 3309), attention now moves to the Senate to consider a a roughly parallel bill. Several amendments passed during today’s debate and we’ll address those in a later post.

In the Senate, Senators Leahy (D-VT), Lee (R-UT), Whitehouse (D-RI), and Klobuchar (D-MN) have proposed the Patent Transparency and Improvements Act of 2013 (S. 1720). In a prior essay, I called the Leahy-Lee proposal “more measured and limited” than the Goodlatte bill and “much more narrowly focused on egregious patent enforcement abuses.”

One important element coming through this process is a clear lack of leadership from the PTO. Although former director David Kappos testified against the Goodlatte proposal, his golden air of credibility and executive authority has shifted since joining the Cravath firm. The PTO has been without a Senate-approved director February 1, 2013 and any new (yet unnamed) PTO director is weeks or months away.

Legislative update.

Chairman Goodlatte is pushing for a vote today in the House on the Innovation Act. Ranking Member Conyers is pushing back. Update: A few minutes ago, the House passed Rep. Goodlatte’s Innovation Act with a strong bi-partisan vote of 325 – 91.

Constitutional Challenge to Administrative Patent Review – Part IV

By Dennis Crouch

Although the parties are ostensibly focused on whether WARF’s “replicating in vitro cell culture of human embryonic stem cells” constitutes patentable subject matter, the Federal Circuit is instead directing its attention to the issue of whether the patent challenger – Consumer Watchdog – has standing to file its patent appeal.

Consumer Watchdog v. Wisconsin Alumni Research Foundation (WARF) (Fed. Cir. 2013)

The Patent Act allows any party to file a post-grant administrative challenge and, if “dissatisfied” the results of the change, to appeal an adverse PTO ruling. Despite the statutory promise of appeal-rights, in Part I, I raised a concern as to whether a third-party challenger who loses at the PTO would necessarily have Article III standing. Within days, of that posting, the Federal Circuit ordered that Consumer Watchdog and WARF brief the issue of whether Consumer Watchdog has standing under Article III.

In Monday’s oral arguments, the court focused entirely on the issue of standing and would hear no arguments regarding the substantive appeal. Dan Ravicher (for Consumer Watchdog) and Kara Stoll (for WARF) both handled themselves very well, but Ravicher noted that the PTO should be at the table since Consumer Watchdog’s complaint is with the PTO for wrongfully issuing the patent and then wrongfully confirming patentability in the reexamination. Chief Judge Rader, Judge Prost and newly enrobed Judge Hughes participated fully in the questioning, although each of indicated some difficulty buying into Ravicher’s argument that Congress created a potential injury-in-fact with its “dissatisfied” language and that the injury was realized when the PTO rejected Watchdog’s case.

However, following Ravicher’s suggestion, the Court has now requested that “the United States Patent and Trademark Office and the United States” provide briefs in the case and particularly brief “whether Consumer Watchdog has standing to pursue its appeal to this court.” Recognizing the recent tension in briefing between the USPTO and the DOJ, the court wrote that “The PTO and the United States may submit a joint brief, if they so choose.”

Although the court does not explicitly welcome other amicus briefs, I am confident that several will be forthcoming. Briefs are due January 6, 2014.

Federal Circuit’s Most Frequently Cited Cases in 2013

The following list comes from a search of 264 patent-related opinions by the Federal Circuit issued this year. The following are the most frequently cited cases found therein:

  1. Cybor Corp. v. FAS Technologies, Inc., 138 F.3d 1448 (Fed. Cir. 1998).
  2. Phillips v. Awh Corp., 415 F.3d 1303 (Fed. Cir. 2005).
  3. KSR International Co. v. Teleflex Inc., 550 U.S. 398 (2007).
  4. Graham v. John Deere Co., 383 U.S. 1 (1966).
  5. Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir. 1996).
  6. Anderson v. Liberty Lobby, Inc, 477 U.S. 242 (1986).
  7. In re Robert J. Gartside, 203 F.3d 1305 (Fed. Cir. 2000).
  8. Markman v. Westview Instruments, 517 U.S. 370 (1996).
  9. Microsoft Corp. v. i4i Ltd. Partnership, 564 U.S. ___ , 131 S.Ct. 2238 (2011).
  10. Omega Engineering, Inc v. Raytek Corp., 334 F.3d 1314 (Fed. Cir. 2003).
  11. Eurand, Inc. v. Mylan Pharms. Inc. (In re Cyclobenzaprine Hydrochloride Extended-Release Capsule Patent Litig.), 676 F.3d 1063 (Fed. Cir. 2012).
  12. Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed. Cir. 1995).

At some point this term, the Federal Circuit will decide Lighting Ballast Control v. Philips Electronics and that decision is expected to serve as a replacement for Cybor.

After Final Consideration Pilot (AFCP) Extended

The USPTO has extended the After Final Consideration Pilot 2.0 (AFCP 2.0) program that basically gives examiners credit for considering responses filed after a final rejection.

To be eligible for consideration under AFCP 2.0, you must file a response under 37 CFR §1.116, which includes a request for consideration under the pilot (Form PTO/SB/434) and an amendment to at least one independent claim that does not broaden the scope of the independent claim in any aspect. . . . If you are considering filing a response to a final rejection under 37 CFR 1.116 that you believe will lead to allowance of your application with only limited further searching and/or consideration by the examiner, you should consider requesting consideration of the response under AFCP 2.0.

The program was scheduled to end on December 14, 2013, but has been extended until September 30, 2014.

Virtual Designs

Guest Post by Mark D. Janis, Robert A. Lucas Chair of Law at the Indiana University Maurer School of Law and Jason Du Mont, Microsoft IP Fellow at the Indiana University Maurer School of Law

While design patents for generated images are commonly portrayed as the newest thing in design patent law, they've actually been around for some time. The USPTO implemented a relevant set of guidelines almost 20 years ago, and today well over 3500 design patents on generated images have been granted.

Nevertheless, scholars have paid relatively little attention to many of the core legal questions these design patents present, and no one has systematically studied how the PTO examines applications that claim these designs. In our recent article, Virtual Designs*, available here, we attempt to fill this vacuum. We analyze the core questions of design patent doctrine, and we provide the first rigorous empirical look at patenting in this sector.

Among the findings are three key points:

  1. Virtual designs are eligible designs "for an article of manufacture" (35 USC § 171).

    Virtual designs are akin to surface treatments. While some design patents protect the shapes of articles of manufacture, others protect surface treatments for articles of manufacture (wallpaper patterns, textile prints, etc.). Surface treatments are eligible subject matter, and always have been, starting with the first design patent provisions in 1842.

    Like other surface treatments, virtual designs (e.g., icons on a phone GUI) are eligible subject matter independent of the appearance of the associated article of manufacture (e.g., the phone).This is not a terribly exotic legal proposition. It's merely a manifestation of the concept thata protectable design may reside in some part of the article; it need not extend to the entirety of the article. Standard design patent claiming practice permits applicants to implement this concept by rendering the unclaimed portions of the article in broken lines.

    While virtual designs may be transient, design patent law has previously dealt with this question, too. The CCPA reversed the PTO's rejection in In re Hruby, involving a design for a spray pattern for a water fountain. The design patent eligibility analysis should not turn on whether the design is too ephemeral, whether the subject matter is a water spray pattern or a virtual design.

  2. Virtual designs equilibrate around the prosecution norms of other design patent sectors

    We studied all available design patents granted for virtual designs and their prosecution histories. We adapted empirical techniques developed for studying utility patents, and extended the traditional proxies used by economists for measuring the quality and private value of utility patents.

    Our analysis indicates that virtual designs are at least on par with design patents from other sectors when assessed by these traditional measures. And, if anything, an argument can be made that they might actually be more heavily scrutinized than others. They not only garner more rejections, but they also receive more prior art citations from examiners, and greater numbers of forward self-citations.

  3. Virtual designs will present a handful of doctrinal challenges

    We expect that design patents for virtual designs will present some challenges for existing rules of design patent anticipation, obviousness, infringement, and remedies. Ultimately, we propose a series of guidelines that seek to account for the transferability of the design among different mediums, and for the need to provide adequate public notice and room to engage in non-traditional, expressive uses of designs.

* We use virtual designs as a generic term that covers everything from GUIs to isolated icons and arrows grouped in classes D14/485 to 495 by the USPTO.

** Read the full article here: