In February 2015, a Delaware Jury sided with Intellectual Ventures in its case against Symantec — finding that the security software company was infringing two IV patents and awarding $17 million in damages. U.S. Patent Nos. 6,073,142 and 5,987,610.
In an interesting post-verdict letter, Judge Stark has noted that the damages may have to be reduced because of the lack of evidence that the patented features “drove demand” for the accused products. [1-10-cv-01067-LPS-691-PRIMARY DOCUMENT]. I should note here that the letter is expressly not (yet) an order.
At trial, Intellectual Ventures damages expert (Michael Wagner) took the risky strategy of presenting only testimony relating to damages under the entire market value rule and did not offer a fallback reasonable royalty position. That approach kept choices simple for the jury, but now it seems that the entire-market-value calculation likely lacks sufficient supporting evidence. If that testimony is disregarded then the only fall-back position is the damage evidence presented by Symantec’s expert. Although that figure is currently under seal, it is most certainly significantly less than the $17 million award.
Judge Stark has also ordered post-trial briefing on whether the asserted claims lack patentable subject matter under Section 101 with the hope of resolving that issue before a second trial where IV is asserting the same patents against Trend Micro. Obviously, a Section 101 ruling could eliminate the damage award in full.
= = = = =
About half of the award was associated with Symantec’s infringement of Claim 7 of the ‘610 patent. Claim 7 is a dependent claim (from claim 1), but I have rewritten it below in its equivalent independent form:
7. A virus screening method comprising the steps of:routing a call between a calling party and a called party of a telephone network;receiving, within the telephone network, computer data from a first party selected from the group consisting of the calling party and the called party;detecting, within the telephone network, a virus in the computer data; andin response to detecting the virus, inhibiting communication of at least a portion of the computer data from the telephone network to a second party selected from the group consisting of the calling party and the called party; and further comprising the step of determining that virus screening is to be applied to the call based upon at least one of an identification code of the calling party and an identification code of the called party.
Random’s arguments here about KSR also seem relevant to the issue of exhaustion involved in the New York Times case. Assume one buys a widget. Under the law of exhaustion, one has a right to use this widget for all uses – albeit, as we learned in the Monsanto v. Bowman, the right to use does not embrace the right to make new copies. Nor does a right to use embrace the right to use the widget in the making of another patented combination or or practicing another patented method – unless, I would argue, that combination or method’s patentability wholly depends upon the presence of the widget, or the novel features of the widget, in the claim.
But this is KSR as well, is it not? If one combines the widget with something else and that something else is nothing more than an expected use of the widget the first place, such a claim cannot be patentable.
How do you fit into your scheme improvement patents by a different inventor?
Well anon, I think one’s only recourse is to prove that other patent invalid — as it violates KSR, just for example.
I am alluding to the (very) wide scope of innovation activity that is concerned NOT with Flash of Genius first-breakthrough, but rather with the flurry of follow on innovation.
There is (again) the specter of evisceration that is (purposefully) being “not seen.”
This goes to ALL art fields.
Muuuuwahahahahaha (link to upload.wikimedia.org)
Had a real case once – involving a motor patent where the owner, using a broadening reissue, also obtained claims to the combination of the motor and a disk drive. My client bought covered motors from a licensed motor vendor. Nevertheless we were sued.
During mediation, the doctrine of exhaustion was not “recognized” in the Federal Circuit, so we argued implied license instead. At the time, this was equivalent, or at least, so we thought. But the mediator ruled against us because, and this was true, the motors were useful for applications other than disk drives and further because the patentee had restricted the sale of the motors to disk drive companies so as to not give the disk drive companies and implied license. An unrestricted license was strictly verboten.
Post Quanta, I think we would have had a clear win had we argued exhaustion because post-sale unilateral restrictions were deemed unavailing. But that was then, and this is now.
Post KSR, and this is to Random’s argument, if the patent was held by other than the original patentee, the patent would have been invalid as the use of the patented motor in a disk drive was an expected and ordinary application so that third parties could not patent that use.
I guess just looking through this I just wonder how Dennis can maintain the position that MM is not a paid blogger. 10 years of being the largest blogger on her and putting 40+ hours a week into blogging on this site and others.
MM clogs up every discussion with his repetition of his propaganda from his employers.
MM, 50
NWPA, 35
anon, 65.
Point?
“If some patent falls into to a covered category, but is plainly an old invention that can’t even pass a common sense test, 101 is a reasonable place to invalidate it”
And this, my friends (and enemies) is the problem. This is not the-one-who-shall-not-be-named, but plainly his (her?) position. No need for prior art, no need for proof – it’s “common sense” (nevermind to many others, it’s not common sense), it’s “plain” on its face (nevermind that there’s no prior art showing it).
Why undergo a rigorous, logically, legally based analysis, when we can go with the gut?
Congrats to everyone who can actually look someone in the eye and say without missing a beat “yes, that disk in your hand was statutory subject matter when it was first claimed, but because it’s claimed with a program stored on it, how could you possibly believe it a product covered by 101?”
The scary thing about this is that many of the followers don’t even seem to understand why this is a problem. Just imagine what criminal court will look like when this lot gets to re-tool it with their new Alice case law.
Since the subject here is the “Entire Market Value Rule” for patent infringement damages, here are some recent cases to discuss [which cite much older cases, since this is not new law]: The patent owner can get damages based on the entire market value of the [entire] accused product only where the patented feature creates the basis for consumer demand. [Or perhaps a consumer demand value of a severable, separately accountable, component part of the accused product?] Versata Software v SAP (Fed. Cir. 2013), VirnetX v. Cisco (Sept. 2014) and Ericsson v D-Link (Dec. 2014). Adequate proof of this “nexus” between the patented feature and the consumer demand for the entire product is often difficult, as discussed here before, without a properly run consumer survey in evidence. Especially for multi-function, multi-feature products.
I think an important question is what were the alternatives at the time of the manufacture.
Perhaps “what were the alternatives at the time of the manufacture” might be some evidence providing the defendant was aware of the possible infringement of that patent back when they made their selection between product alternatives to make or sell. But that prior knowledge is usually not the case these days, outside of pharma, with millions of patents in force each containing even more claims. In any case, I do not see how that alone is sufficient proof for the Entire Market Value Rule that the commercial success of the defendants product was due to the patented feature rather than to market power, advertising, lower prices, etc.?
That said, as to MM’s note, there are products like some pharmaceuticals, or even the recent case of a superior new windshield wiper sold at a premium price based on its patented feature superiority, where proof of the“nexus” between the patented feature and the consumer demand for the entire product is not totally impossible.
Why would “some evidence providing the defendant was aware of the possible infringement of that patent back when they made their selection between product alternative” have anything to do with anything except perhaps the treble damage aspect of willful infringement?
Paul: adequate proof of this “nexus” between the patented feature and the consumer demand for the entire product is often difficult, as discussed here before, without a properly run consumer survey in evidence.
Impossible is more like it.
And it’s also critical that such a survey addresses the specific embodiments actually disclosed by the patentee (what specific viruses are being detected and what software is being used to detect those viruses) and/or the specific embodiments actually implemented by the accused infringer, and not the ridiculous scope of the claim at issue. A key question is: what percentage of viruses would be detected by implemeting the specific software disclosed in the patentee’s application? How much is that level of protection “worth”? What percentage of viruses were actually detected by the accused infringer’s methods? How much is that level of protection worth?
“critical that… the specific embodiments actually disclosed…, and not the ridiculous scope”
That is CLEARLY not the law.
As this is not the law, and is merely your opinion of what you want the law to be, please try to convince me why this is so critical. If indeed so critical, how has Congress gotten by since the founding of this country without having this as law?
I think that your Red Queen edict needs some serious groundwork to support the supposed “critical ness.”
MM, the virus checking per se is entirely old and has nothing to do with the invention.
The only thing new in the claim is the use of signaling codes to signal the telephone network to conduct the virus checking.
See the way it works Ned according to the Lemley is that if you put something in there like a light detector if you don’t disclose every possible light detector then it is invalid under 112. It is a new push to increase the size of the patent applications to be in excess of 100,000 pages each.
It’s also a rather weak attempt to curb the (unforeseen) consequence that happened when the Supremes super-empowered PHOSITA in KSR, thus reducing the bar as to what needs to be included in patent applications (which expressly tell people not to include what PHOSITA may know), and not-so-paradoxically makes the use of descriptions sounding in functional language (a power expressly broadened by the Act of 1952) stronger.
“The basis.”
This too is a problem.
What if one proves “a basis?”
Is this sufficient to support the jury verdict?
link to dailycaller.com
That is what the former CEO of HP says about patent reform. Consistently what we are seeing is real people as opposed to shills saying that patents have been great for our economy.
While a technical person, she is still a politician…
I will give you that more and more politicians are choosing this plank to rally about, and I do suppose that’s a good thing, but I would still be cautious when dealing with anyone stumping on the political trails.
I agree anon. But, let’s be real. Alice illustrates a complete failure by the SCOTUS to respect the rule of law and a complete disregard for the reality of science. Alice would seem very natural in medieval Europe.
To be clear, the reason Alice is so bad is because it wants to skip the real work and allow a judge to be judge, jury, and executioner with no due process.
The ground game is find prior art and build arguments why it is obvious. If you can’t do that, then it most likely deserves a patent. I have yet to see a single claim despite multiple challenges on this blog of a claim that was somehow obviously underserving of a patent, and yet it would be impossible to come up with a 103 argument.
That’s because this is one of the fictions of the Lemley.
Completely agree – and I would add that our friend Mr. Snyder only too willingly reiforces this notion as per his early comments that 101 should be used purely for convenience to avoid the costs of 103.
I find it absolutely amazing how eager anti-software people are to NOT want to understand the actual history of patent law and how – and why – 103 was created.
This is indeed not rocket science and anyone (and everyone) wanting to join the conversation should be aware – and should respect – this history.
I agree anon. I think what is even more scary to me is that this is not isolated to patent law. Image Alice in criminal law. It would basically be a judge just sitting their in his/her chambers generating arguments why you are guilty or not guilt.
Quite.
The notion of “the ends justify the means” should be a red flag to anyone with even the remotest understanding of law.
anon, you habitually mischaracterize other people’s positions in addition to creating strawmen arguments at every turn. Even the unsophisticated know that those are rhetorical tactics indicating weak positions.
As you may recall, prior to the Alice decision, there was much talk of where procedurally 101 decisions should be made. I argued, as did most others, that the start of the case, using the only the pleadings and the patents, was the smarter choice because of the huge financial and time burdens faced by defendants to get to a 102/103/112 decision.
I also argued (and still do) that your obsession with the primacy of congress in the operations of law is misplaced. We have three co-equal branches, and while congress can say anything they like, the courts ultimately say what the law is, even beyond statues and procedures, because there is a substantial Rule of Law argument that high courts can do whatever they need to do to avoid manifest injustice.
Section 101 includes some inquiry as to novelty. However sharp or blunt that inquiry may be as it interplays with the other sections of the law and the established procedures of the courts, it seems to me that only subject matter extremists think there is no novelty inquiry there whatsoever.
If some patent falls into to a covered category, but is plainly an old invention that can’t even pass a common sense test, 101 is a reasonable place to invalidate it, especially to avoid huge costs for people innocently accused of infringement. I know you could give a fig about the immorality of those costs, but courts are supposed to care about flat injustice happening on their watch. A judge should be able to “gist” something that is as plain as day. That’s been my position and it has not changed.
Patent lawyers don’t get a lot of trial experience, but its pretty clear in the day to day workings of the law across the land that judges powerfully influence just what bits of rules and laws end up influencing final outcomes. Its not a bug, its a feature of our system, like it or not.
Martin, anon reflects a view very common among patent attorneys and the patent VIPs who largely view the Supreme Court and most circuit courts as “a problem.” They erect lobbying organizations in Washington to try to change the law all the time in their favor — the favor of patent attorneys and these VIPs.
What have they done in recent history?
1. Federal Circuit — to take judicial control of the patent system as best they could manage. They wanted to staff its bench with patent attorneys — just like Rich.
2. ’52 Act – to overturn a number of Supreme Court decisions.
3. Sundry acts between ’52 and the AIA to limit the effect of the Supreme Court decision that secret prior art (102(e)) was available for obviousness purposes.
4. Acts to fix other precedents they did not like — to numerous to fully catalog.
5. Reexaminations, IPRs and the like to address the problem of juries deciding patent validity. Essentially they wanted to “lower” the bar — preponderance of evidence, BRI in the PTO — so that they could get rid of patents brought against the VIPs more “reliably.”
6. The AIA to feather the nests of the VIPs at the expense of the small fry.
7. And the Goodlatte Bill to address the so-call troll problem.
In all of this, one see a central figure guiding virtually every move — and to its favor.
Yes. IBM
You think IBM wanted IPRs?
Yes.
Ned,
With all due respect, you are completely off your rocker if you think ANY of my positions have been against true innovation and in favor of the Big Corp and their desire to weaken patents.
Truly absurd of you.
Ned, the AIA greatly weakened patents. It is true that patents were made more for the elite due to the AIA, but the AIA greatly weakened the value of all patents. I don’t believe that IBM would have wanted that.
If you want to clean things up, Congress should get rid of Alice, Benson, etc.
And modernize the PTO.
Ned,
Your unadorned adoration of the judiciary (especially the Supremes) distorts and unbalances the careful tri-part checks and balances (and is reflected by those less savvy like Mr. Snyder having a warped view of the power of the Court).
Further, Try telling me the Court is not a political beast…
link to huffingtonpost.com?
“Carly Fiorina excoriated a Republican patent reform proposal in a speech to inventors on Wednesday, comparing it to Obamacare and Dodd-Frank.
Fiorina gave the keynote address at the Inventing America conference, at which representatives from universities, companies and non-profit foundations came together to discuss the current state of intellectual property rights in America.
A running theme throughout the conference was the attendees’ animated opposition to the Innovation Act (H.R. 9), a bill sponsored by Republican Rep. Bob Goodlatte that is intended to discourage abusive patent litigation, known as patent trolling.”
Now Ms. Fiorino might also be a candidate for the Republican nomination for president. Having someone of her status opposing Goodlatte has got to give the opposition some gravitas.
Carly Fiorina excoriated a Republican patent reform proposal in a speech to inventors on Wednesday, comparing it to Obamacare
ROTFLMAO
The Affordable Care Act is pretty darn popular.
Sure, a tiny class of wealthy elites and their braindead sycophants will tell you that government-funded healthcare is the height of fascist-communism. But outside of that minority pretty much everybody else is benefitting. Could it be improved upon? Sure. But those same weatlhy elites and their sycophants were even more opposed to a single payer system.
Gotta keep those professional grifters in the insurance industry contiually well fed, after all. Any of this sound familiar? Get your patent insurance right here, folks …. Ah, the great dream.
Medicare for all, now.
Yes MM let’s bundle together everything she said as a politician and impute that on her arguments on patents. She has stated over the years that she believes that strong patents are important for our economy based on her experience at HP.
But let’s be the nasty little minded person that you are and throw in other stuff and not address any substantive issues—sure sounds a lot like a jihadist to me.
SlotGuy: are you saying US 3030609 should have been rejected as ineligible subject matter? Because that would have been the farthest thing from anyone’s mind in 1962
Pretty sure this was also the farthest thing from anyone’s mind in 1962:
link to patentlyo.com
As was the idea of a company going all the way to the Supreme Court with an argument that its patent made it unlawful for people otherwise practicing the prior art to think — yes, THINK — about a correlation that the same company publicly disclosed in its patent application.
But it happened, just a few years ago.
It’s 2015, SlotGuy. Try to remember that.
You keep on using the number of people choosing to use the patent system as some implicit type of measure of a “bad” thing.
It isn’t.
Even Prof. Crouch has recently indicated that we are in the midst of an innovation boom.
Just because the abundance of innovation today is the type that you seek to disparage and not protect (and yet you still refuse to put your money where your mouth is and abstain from this type of innovation), does NOT mean either that the innovation is my there, nor that the innovation does not deserve protection under the law.
It is indeed 2015, Malcolm, time for you to leave behind the flat-world anti-software mindset.
(And time to leave behind the mere aggregation “pet” – but oh so b@nal – theory that you fall back to every single time.
Lol – damm auto-correct…
Read “is my there” as “is not there”
we are in the midst of an innovation boom.
Sure we are! Because Dennis said so!
LOL
Nice spin.
It is not because Prof. Crouch has said so, but it is an offered discussion point that even Prof. Crouch has noted this.
Instead of kicking up dust, perhaps you want to address the substance of the point?
(More likely, you don’t because that substance is off of your script – one of those inconvenient facts that you will do everything NOT to discuss).
Again, MM does not address the substance. We know why you don’t because you lose on the substance.
“Even Prof. Crouch has recently indicated that we are in the midst of an innovation boom.”
It’s funny you should say that, (and I kinda agree), but why then are all the guys on the ol economics/financial side disagreeing and stating that innovation is practically flatlining so far as the econ is concerned as a whole?
You do realize that the Econ and innovation don’t progress lockstep with each other, right?
“You do realize that the Econ and innovation don’t progress lockstep with each other, right?”
It ain’t really a “boom” if you don’t get “econ boom” out of it anon. That’s the “boom” part everyone cares about. If it’s just a “boom” of eggheads gazing at their navels nobody cares.
Your attempt to conflate is only confusing yourself.
It’s interesting to note though 6, that both you and Malcolm err on this tie to money in opposite extremes.
Here you seem to imply that the only “good” innovations are those directly tied to making money and boosting the Econ. Malcolm appears to take the opposite extreme and often reflects that patents geared to making money (or being monitized) are “the worst things ever.”
If course, you are both wrong and both exhibit a fundamental lack of understanding of innovation, and it’s interrelationship with “making money.” An interrelationship that simply is NOT lockstep with the Econ, while certainly with nothing at all wrong in seeking that “making money.”
you are both wrong
Of course we are, “anon”! Ride the high horse!
Let’s go back to State Street and pre-Prometheus so we can “promote” even “more” “innovation”!
Your comment is a meaningless non-sequitur as neither of those cases have anything to do with the topic at hand.
Try to stay focused.
“Here you seem to imply that the only “good” innovations are those directly tied to making money”
I’m not implying that at all. I’m simply discussing the alleged “boom”. If we’re going to say there is a “boom” then the “boom” is economic. If we’re having an “innovation boom” that doesn’t involve economic boom then frankly I could give two dams less about the “innovation boom” and so could everyone else. A million times more navel gazing than in years past really doesn’t help anyone.
“Malcolm appears to take the opposite extreme and often reflects that patents geared to making money (or being monitized) are “the worst things ever.””
That’s because we’re (he and I both) are talking about actual “economic boom”, not “grifter boom”.
“An interrelationship that simply is NOT lockstep with the Econ,”
Which is exactly why patent reform is on the way and you will take it, kicking and screaming the whole way.
“while certainly with nothing at all wrong in seeking that “making money.””
According to you. Though not according to the people setting up the entitlement program upon this particular house of cards is built. And not according to the people that vote for those people.
Once again – you confuse yourself in your attempts to conflate innovation and Econ.
“Once again – you confuse yourself in your attempts to conflate innovation and Econ.”
Right, I “confused myself”. Lol. That’s a fancy way of saying you just don’t get what’s going on around you.
You’re all “who, whaaaaa, where? You must be confuzzled because I dun understand why you guys are all concerned about the actual useful arts and keep calling my stuff the not-useful arts!”
Unfortunately for you, there are other people that do understand. And they have power, and them wheels are a turnin.
No. I meant exactly what I said: you are confusing yourself.
Take it a step at a time: you do realize that Econ and innovation are two different things, right?
Obviousness changes over time, so does novelty. But patent-eligibility doesn’t. What was eligible in 1962 is eligible today.
The USPTO has been granting patents on data processing methods for over 50 years, so a suggestion that data processing methods were never patent-eligible is empirically incorrect. Further, the Supreme Court held in Festo (citing Warner-Jenkinson) that “courts must be cautious before adopting changes that disrupt the settled expectations of the inventing community.”
Retroactively invalidating all data processing methods is not “being cautious,” and half a century is certainly long enough to establish settled expectations. Frankly, with all the Alice rejections in litigation lately, I’m surprised nobody has filed a 5th Amendment takings claim yet. (Or have they?)
Given that history, I am interested in how to draw a line between eligible and ineligible data processing methods. Perhaps the line to be drawn, if there is one to be found, lies in whether the data being processed is treated syntactically or semantically. Even then, context-sensitive data processing is commonly more efficient than context-free processing; e.g., video stream compression works differently — and better on video streams — than generic data compression. And yes, there are plenty of old patents on systems for data compression. I don’t know the answer, that’s why I’m asking the questions.
SlotGuy: The USPTO has been granting patents on data processing methods for over 50 years,
So what?
Data processing has been around for millions of years. Animals do it.
The PTO started granted some junky data processing patents 50 years ago, you say? That’s nice. Last time I checked the PTO doesn’t make law. In fact, recent history shows that the PTO has an incredible habit of ignoring the law to benefit and coddle its favorite “stakeholders.”
Frankly, with all the Alice rejections in litigation lately, I’m surprised nobody has filed a 5th Amendment takings claim yet.
That’s funny stuff right there. Go ahead and file your “takings claim” yourself. I can’t wait to see the “innovation” at issue. An “app” that makes your phone vibrate when your coffee is too hot to drink, maybe? Oops, I just innovated again. Can I haz patent now?
context-sensitive data processing is commonly more efficient than context-free processing
No kidding.
Perhaps the line to be drawn, if there is one to be found, lies in whether the data being processed is treated syntactically or semantically.
These are general theories of logic and meaning. Is “logic” one of the “useful arts”? Since when? Since the PTO started behaving as if that was the case?
Can I patent an improvement in writing style? I’m saving paper, after all. That’s useful.
“Can I patent an improvement in writing style?”
Too clever by half.
Look at what WAS granted to Morse.
ook at what WAS granted to Morse.
The evidence that Morse was a fraud is pretty good.
But go ahead and pretend otherwise. After all, it’s very convincing to the people who can’t tell the difference between 1850 and 2015. All ten of you.
“The evidence that Morse was a fraud is pretty good.”
Again – a completely meaningless non-sequitur to the topic at hand.
Try to make just a little sense in your “replies.”
dash-dash dot-dash dot-dash-dot-dot dash-dot-dash-dot dash-dash-dash dot-dash-dot-dot dash-dash
dot-dot-dot dot dot-dash-dot-dot dot-dot-dash-dot
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Anon,
This one made me laugh! Even if I don’t agree. Definitely won’t get filtered!
Glad you enjoyed it, but (considering the source), not all that surprised that you don’t agree with wha is plainly self-evident.
You are aware of what Morse did gain patent protection for, right?
anon, are you suggesting it was the code?
dot-dash dash-dash-dot dot-dash dot-dot dash-dot
… – .. .-.. .-.. .- …
.. -. -.-. — -.
– .. -. ..- — ..- …
“Obviousness changes over time, so does novelty. But patent-eligibility doesn’t.”
SlotGuy, you are oh so close and just one little nuance off.
Let me drop you a hint: the universe outside of the Hand of Man is not a static place.
Think of Putensite.