It makes sense that the government cannot use Copyright to keep the law out of the hands of the general public. The Government Edicts Doctrine takes care of this for statutes and precedential judicial opinions. The question before the Supreme Court now asks how far that doctrine extends. In particular, in Georgia v. Public.Resource.Org Inc., the state of Georgia argues that the official annotations to its statutes can be protected by copyright. Thus, question presented (as simplified):
Is the Official Code of Georgia Annotated (OCGA) an edict of government?
Briefing in the case is ongoing, but I want to highlight the most interesting brief filed so far — the history-focused amicus filed by Charles Duan on behalf of R Street, Wikimedia, and Public Knowledge.
Twenty-five centuries of history reject the foundation of Petitioners’ case. In contending that it may assert federal copyright law against its citizens to block distribution of the OCGA, the State of Georgia contemplates a bright line between its uncopyrightable statutes and all other edicts of government that “lack the force of law.” No such line exists. On the contrary, sovereigns since antiquity have promulgated not only statutes but also proclamations, explanations, commentaries, and even annotations, all of which, even lacking “force of law,” carry great weight for the rule of law and the functioning of government. History reveals not a binary divide between statutes and all else, but a spectrum of edicts of government.
To fill this historical void in the record, this brief surveys nonbinding pronouncements, particularly attached to statutes or codes of law, across time and around the world, from Rome and China to England and America. This historical review—which traverses a Roman whistleblower, the Justinian Code, a dark side of Confucianism, English libertarianism, New York suppressing the press, and the Mayor of London being thrown in jail — reveals multiple important lessons that question the basis upon which Georgia’s argument stands.
In the US, we are still celebrating Columbus Day at the Federal Level. So, USPTO and the Courts are closed. (The Law School is still in operation and I’m teaching today.)
U.S. Patent 4,915,391 claims:
1. A board game comprising:
a. a game board having an endless path of contiguous blocks, some of the blocks representing property which is purchasable and a plurality of the blocks each displaying two alternative directions,
b. a plurality of destiny cards, each card describing an event,
c. a plurality of ownership cards, each card describing commercial transactions for a different piece of property,
d. a device operable by the players for determining randomly between said two directions,
e. a plurality of tokens, one for each player,
f. a plurality of property markers for identifying ownership of property, and
In this new series, I’m looking back to 19th Century Supreme Court patent cases; looking for their wisdom; and considering their ongoing importance.
Winans v. Denmead, 56 U.S. 330 (1853) is cited as an early doctrine of equivalents (DOE) case, although I see it also as an early claim construction decision. According to Westlaw, is the 10th most cited patent case of the 19th Century. At the time of the case, Winans was on his way to becoming one of the wealthiest Americans by making and selling railroad equipment.
As shown in the diagram below, the Winans patent covers a railroad car for transporting coal, etc. The car has a cone-shape particularly “the form of a frustum of a cone, substantially as herein described” The shape allowed the car to carry “more coal in proportion to its own weight than any car previously in use.” Further, excess load did not distort the shape because it “presses equally in all directions.” Id.
The accused infringer inspected a Winans-made car and then made its own — although using an octagonal shape rather than circular as in the patent (looking down as in fig 1). The defendants argued this difference in should have resulted in a non-infringement verdict; Winans argued that this difference was immaterial because the octagonal car was almost the same shape and obtained the same useful results. Further, after being used for a while, the sheet metal used will shape itself into a circle.
The jury was asked Winans asked for jury instructions akin to the function-way-result test:
whether ‘the form adopted by the defendants accomplished the same result, substantially, with that in view of the plaintiff, and upon substantially the same principle and in the same mode of operation.’
However the lower court took a much narrow stance and effectively instructed the jury that they could only find infringement against conical bodies since the operation of the invention is “due alone to conical vehicles and not to rectilinear bodies.” With that narrow instruction, the jury could not find infringement.
The Supreme Court reversed course — concluding that the court must not allow form to dictate substance.
[I]t is the duty of courts and juries to look through the form for the substance of the invention—for that which entitled the inventor to his patent, and which the patent was designed to secure; where that is found, there is an infringement; and it is not a defence, that it is embodied in a form not described, and in terms claimed by the patentee. . . .
The exclusive right to the thing patented is not secured, if the public are at liberty to make substantial copies of it, varying its form or proportions.
In the end, however, I see this case largely about claim construction. The Supreme Court explained that a cone in Euclidean sense is impossible to construct except by imagination.
It may safely be assumed, that neither the patentee nor any other constructer has made, or will make, a car exactly circular. In practice, deviations from a true circle will always occur.
Thus, it is clear to the court that the “cone” limitation in the claim does not require an exact cone. The court went on to interpret the meaning of the patent as covering a design
“so near to a true circle as substantially to embody the patentee’s mode of operation, and thereby attain the same kind of result as was reached by his invention. . . . It must be the same in kind, and effected by the employment of his mode of operation in substance.”
The court ordered that on remand the jury can consider infringement under this broader view of the patent.
Justice Curtis wrote the 5-4 majority opinion.
The dissent by Justice Campbell began with a suggestion that the substance of the invention is likely obvious (lack of invention).
The merit of the plaintiff seems to consist in the perfection of his design, and his clear statement of the scientific principle it contains. . . . There arises in my mind a strong if not insuperable objection to the admission of the claim, in the patent for ‘the conical form,’ or the form of the frustum of a cone,’ as an invention.
The dissent went on – assuming that the patent is valid — noted that it should be assumed that a patentee will draft claims in a way that reach “exactly the limits of his invention” and that it is improper for the court to “extend, by construction, the scope and operation of his patent, to embrace every form which in practice will yield a result substantially equal or approximate to his own.”
The plaintiff confines his claim to the use of the conical form, and excludes from his specification any allusion to any other. He must have done so advisedly. He might have been unwilling to expose the validity of his patent, by the assertion of a right to any other. Can he abandon the ground of his patent, and ask now, for the exclusive use of all cars which, by experiment, shall be found to yield the advantages which he anticipated for conical cars only?
The dissent went on to complain that the majority’s approach has little bound —
The claim of today is, that an octagonal car is an infringement of this patent. Will this be the limit to that claim? Who can tell the bounds within which the mechanical industry of the country may freely exert itself? What restraints does this patent impose in this branch of mechanic art?
The patentee is obliged, by law, to describe his invention, in such full, clear, and exact terms, that from the description, the invention may be constructed and used. Its principle and modes of operation must be explained; and the invention shall particularly ‘specify and point’ out what he claims as his invention. … Nothing, in the administration of this law, will be more mischievous, more productive of oppressive and costly litigation, of exorbitant and unjust pretensions and vexations demands, more injurious to labor, than a relaxation of these wise and salutary requisitions of the act of Congress. In my judgment, the principles of legal interpretation, as well as the public interest, require, that this language of this statute shall have its full significance and import.
Id.
In Graver Tank, the Supreme Court identified Winans as the origin of the doctrine of equivalents.
The essence of the doctrine is that one may not practice a fraud on a patent. Originating almost a century ago in the case of Winans v. Denmead, 15 How. 330, 14 L.Ed. 717, it has been consistently applied by this Court and the lower federal courts, and continues today ready and available for utilization when the proper circumstances for its application arise.
Graver Tank & Mfg. Co. v. Linde Air Products Co., 339 U.S. 605, 608 (1950).
Still, when I read the case, I see claim construction. Notably, the question presented by the court is whether the word ‘cone’ is properly construed and the court answered that it is nearly a circle, and the purpose of the invention helps to understand the limit of that subjective limitation.
In our judgment, the only answer that can be given to these questions is, that it must be so near to a true circle as substantially to embody the patentee’s mode of operation, and thereby attain the same kind of result as was reached by his invention.
Id. The reason the court felt obliged to consider this construction is its conclusion that “construing the letters-patent” “is a question of law, to be determined by the court.” The dissent seemed to similarly agree that the focus is about claim construction — arguing that the majority’s “construction” is too broad.
The order on guidance documents requires agencies to provide their guidance documents on easily searchable websites along with disclaimers about their legal effect. In addition, for new guidance documents that are “significant,” the order requires public notice and comment of at least 30 days and approval by “the agency head or by an agency component head appointed by the President, before issuance.” “Significant guidance document” is defined as including the usual >$100 million effect on the economy, but also encompasses guidance documents that raise novel legal or policy issues arising out of legal mandates, the President’s priorities, or the principles of [EO] 12866.”
The order on adjudications seeks to require greater public notice of both agency jurisdiction and the relevant legals standards applied by agencies in enforcement actions and adjudications. Provisions include the requirement that “When an agency takes an administrative enforcement action, engages in adjudication, or otherwise makes a determination that has legal consequence for a person, it may apply only standards of conduct that have been publicly stated in a manner that would not cause unfair surprise.” The order also limits the use of guidance documents by the agency:
Sec. 3. Proper Reliance on Guidance Documents. Guidance documents may not be used to impose new standards of conduct on persons outside the executive branch except as expressly authorized by law or as expressly incorporated into a contract. When an agency takes an administrative enforcement action, engages in adjudication, or otherwise makes a determination that has legal consequence for a person, it must establish a violation of law by applying statutes or regulations. The agency may not treat noncompliance with a standard of conduct announced solely in a guidance document as itself a violation of applicable statutes or regulations. When an agency uses a guidance document to state the legal applicability of a statute or regulation, that document can do no more, with respect to prohibition of conduct, than articulate the agency’s understanding of how a statute or regulation applies to particular circumstances. An agency may cite a guidance document to convey that understanding in an administrative enforcement action or adjudication only if it has notified the public of such document in advance through publication, either in full or by citation if publicly available, in the Federal Register (or on the portion of the agency’s website that contains a single, searchable, indexed database of all guidance documents in effect).
The orders include several limitations on their scope and effect, but overall they’re very wide-reaching. I’m especially interested in the ways in which they might affect the USPTO, but really need to spend some time thinking through the implications. For example, on the one hand, the MPEP is specifically directed to examiners, not patent applicants. On the other hand, it’s often quoted directly by examiners in office action responses and relied on fairly heavily by applicants. Lots to unpack here.
There are some great posts over at the Notice and Comment blog about the two orders. Thanks to Chris Walker for pointing these out.
2000: When I started law school, I remember finding @IPWatchDog (I’m sure it was via @askjeevesdotcom ). Great insight and explanation of the law. Thanks Gene, and Congratulations on 20 years! pic.twitter.com/VFXmpbmT5x
In 2012 B.E. Sued Facebook for infringing the claims of its U.S. Patent 6,628,314. In 2013, the district court stayed the litigation pending inter partes review. The IPR proceedings ended in 2015 with a finding that the claims were unpatentable and the Federal Circuit affirmed that decision on appeal in 2016.
Back at the district court, Facebook requested judgment on the pleadings in its favor and with prejudice while B.E. argued that the case should be dismissed for as moot rather than decided on the merits. The district court agreed with the patentee — once the claims were cancelled the lawsuit was moot and had to be dismissed for lack of jurisdiction.
Costs to Prevailing Party: Under the Rules of Civil Procedure, “costs” are generally awarded to the prevailing party.
Unless a federal statute, these rules, or a court order provides otherwise, costs—other than attorney’s fees—should be allowed to the prevailing party.
Fed. R. Civ. P. 54(d)(1). The district court awarded $4,424 in costs to Facebook as the prevailing party.
On appeal B.E. argued that there is no prevailing party when a case is dismissed as moot. The Federal Circuit has rejected that argument:
We agree with Facebook that it is the prevailing party.
Here, it is clear that FB “rebuffed” the patentee’s claims and effectively prevailed in the lawsuit. However, the patentee has an important Supreme Court case on its side: Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health & Human Res., 532 U.S. 598 (2001). In Buckhannon, the Supreme Court explained:
Numerous federal statutes allow courts to award attorney’s fees and costs to the “prevailing party.” The question presented here is whether this term includes a party that has failed to secure a judgment on the merits or a court-ordered consent decree, but has nonetheless achieved the desired result because the lawsuit brought about a voluntary change in the defendant’s conduct. We hold that it does not. . . . [Rather, a] “prevailing party” is one who has been awarded some relief by a court.
Although Buckhannon strongly favor’s the patentee in this case, it is not the only Supreme Court case on the topic — and conflicts fairly directly with the Supreme Court’s later decision in CRST Van Expedited, Inc. v. E.E.O.C., 136 S. Ct. 1642 (2016). In CRST, the plaintiff’s employment discrimination case was dismissed because the plaintiff (EEOC) had failed to meet presuit obligations of fully investigating claims and attempting to resolve the claims. In its decision, the Supreme Court held that the defendant could be deemed a “prevailing party” since the defendant “fulfilled its primary objective” of rebuffing the plaintiff’s case. A “defendant may prevail even if the court’s final judgment rejects the plaintiff’s claim for a nonmerits reason.”
Here, the Federal Circuit extended CRST — holding that Facebook is clearly the prevailing party here even though the case was dismissal for mootness:
As the district court held, Facebook obtained the outcome it sought via the mootness dismissal; it rebuffed B.E.’s attempt to alter the parties’ legal relationship in an infringement suit. This is true even though the mootness decision was made possible by a winning a battle on the merits before the PTO.
Here, the Federal Circuit does not appear to be holding that there will always be a prevailing party when a case is dismissed as moot. Rather, B.E. v. Facebook is a special case involving the parallel inter partes review proceedings. What the court recognized effectively is that IPR proceedings are now part and parcel of the infringement litigation process and should be treated as such. This is one further step toward attuning the system so that the various tribunals are all playing by the same rules.
The Supreme Court heard oral arguments this week in NantKwest (attorney fees for PTO in §145 actions) – and I provided my expectation that the Court will affirm the Federal Circuit’s no-attorney-fees holding. The Court has one other patent case on the merits calendar Thryv, Inc., fka Dex Media, Inc. v. Click-To-Call Technologies, LP, No. 18-916 (appellate jurisdiction over challenge to PTO’s finding of no time-bar under §315(b)). Click-to-Call is set for oral arguments December 9, 2019.
Petitions Denied: A number of petitions that were pending last week have now been denied by the court:
Acorda Therapeutics, Inc. v. Roxane Laboratories, Inc., No. 18-1280 (obviousness and secondary indicia)
Hyatt v. Iancu, No. 18-1285 (“Whether MPEP § 1207.04 violates patent applicants’ statutory right of appeal following a second rejection.”)
Glasswall Solutions Ltd. v. Clearswift Ltd., No. 18-1448 (eligibility on the pleadings; Berkheimer question)
StrikeForce Tech., Inc. v. SecureAuth Corp., No. 19-103 (Berkheimer question)
IBG LLC v. Trading Technologies Int’l., Inc., No. 19-120 (definition of “technological invention” for CBM)
Zimmer, Inc. v. Stryker Corp., No. 18-1549 (is negligence enough for treble damages?)
Xitronix Corp. v. KLA-Tencor Corp., No. 19-58 (Federal Circuit jurisdiction over Walker Process antitrust claims)
Senju Pharma. Co., Ltd. v. Akorn, Inc., No. 18-1418 (propriety of R.36 judgments; obviousness)
Imperium IP Holdings (Cayman), Ltd. v. Samsung Electronics Co., Ltd., No. 19-101 (reviewing jury verdict and 7th Amendment)
Arunachalam v. International Business Machines Corp., No. 19-5033 (low quality)
Huang v. Huawei Tech. Co., Ltd., No. 18-1275 (low quality)
Note here that a couple of cases asking Berkheimer style questions were denied — suggesting the likely outcome in Berkheimer.
Speaking of Section 101 — there are a number of pending petitions on the subject. We are particularly waiting for the Solicitor General to provide the Supreme Court with its input in Berkheimer and Vanda. I had expected those to be filed by this week — they are not yet filed.
HP Inc., fka Hewlett-Packard Company v. Steven E. Berkheimer, No. 18-415 (fact-law divide in eligibility) (waiting for views of Solicitor General)
Hikma Pharmaceuticals USA Inc., et al. v. Vanda Pharmaceuticals Inc., No. 18-817 (threshold of a natural phenomenon) (waiting for views of Solicitor General)
Trading Technologies International, Inc. v. IBG LLC, No. 19-353 (patentability of an improved user interface)
Garmin USA, Inc., et al. v. Cellspin Soft, Inc., No. 19-400 (Berkheimer questions)
Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC, No. 19-430 (did the Supreme Court mean to invalidate all diagnostic methods on eligibility grounds?)
Power Analytics Corporation v. Operation Technology, Inc., No. 19-43 (Has the Federal Circuit correctly implemented the standards for patent eligibility)
Other pending petitions:
Atlanta Gas Light Company v. Bennett Regulator Guards, Inc., No. 18-999 (same question as Click-to-Call); Superior Communications, Inc. v. Voltstar Technologies, Inc., No. 18-1027 (same question as Click-to-Call); Arris International Limited v. ChanBond, LLC, et al., No. 19-455 (same question as Click-to-Call)
Enplas Display Device Corporation v. Seoul Semiconductor Company, Ltd., No. 18-1530 (can foreign sales qualify as induced infringement of a U.S. patent — if defendant knew that “the components might be incorporated by third parties into infringing products that might be sold by other third parties in the United States.”)
Eli Lilly and Company v. Erfindergemeinschaft UroPep GbR, No. 18-1515 (functional single step claim and Halliburton (1946))
Technology Properties Limited LLC v. Huawei Techs. Co., Ltd., No. 19-324 (“prosecution history disclaimer” and separation of powers)
Regents of the University of Minnesota v. LSI Corporation, No. 19-337 (state sovereign immunity against IPR challenge)
Medtronic, Inc. v. Mark A. Barry, No. 19-414 (when is a process-invention “ready for patenting” so that a public use or offer to sell would create a bar to patentability)
Time Warner Cable, Inc., et al. v. Sprint Communications Company, L.P., No. 19-211 (damage apportionment; scope of written description)
Brigham and Women’s Hospital, Inc v. Perrigo Company, No. 19-450 (setting aside jury verdicts)
Neology, Inc. v. International Trade Commission, et al., No. 19-445 (due process — is it proper to invalidate a patent without first notifying the patentee of the “specific invalidity challenge posed” and allow for an opportunity to be heard)
Straight Path IP Group, LLC v. Apple Inc., No. 19-253 (R.36 judgments on pure issues of law is a due process violation).
Princeton Digital Image Corporation v. Adobe Inc., No. 18-1343 (impact of a consent judgment on appellate power)
A few petitions likely to be filed soon:
Intel Corporation v. Continental Circuits LLC (claim construction)
Cisco Systems, Inc. v. SRI International, Inc. (eligibility)
Kaneka Corporation v. Xiamen Kingdomway Group Company (Did this R.36 affirmance violate the patentee’s Constitutional right — 5th & 7th Amendments; and Article I, Section 8, Clause 8)
Peter v. NantKwest (Supreme Court 2019) [TRANSCRIPT]
The Supreme Court heard oral arguments on October 7, 2019 in this case involving the question of attorney fees in Section 145 civil actions. I’ll agree with Mark Walsh who identified this as a “a dry, procedural patent case.” But, I really enjoyed the oral arguments — Read some of the drama below.
Before getting too dramatic: I recognize that the result of this case is basically not going to have much of any impact on patent cases. So, perhaps one benefit is that the court is unlikely to ruin the patent system with its decision here. Depending upon the outcome, Section 145 civil actions will be seen as relatively more/less expensive for the applicant. But, they are already very expensive for an applicant to pay its own expenses. My take is that the added PTO-attorney expense will be a relatively small extension of the already high-costs assuming that the PTO continues to be fairly thrifty in its defense of these cases. On the PTO side, the agency has to pay its attorneys from collected fees somehow. If it doesn’t get the fees from the 145 challenger, then it will collect them from the applicant pool in general (about $1.60 per applicant) as it has done for many years.
Conventional wisdom in patent cases is reversal. The Supreme Court does not take cases to offer congratulations to the lower court. And the absence of circuit splits means that there isn’t a right vs wrong appellate court. My read of the oral argument though goes against this conventional wisdom — I’m betting on affirmance. The Gov’t dropped its argument that the American Rule does not apply; and so the American Rule as applied in other areas has the potential of being undermined by a Gov’t win here.
Prof. Erika Lietzan (Missouri) and Prof. Kristina Lybecker have released an important new article that they title Distorted Drug Patents. (Forthcoming in Washington Law Review).
The basics: New drug treatments require pre-approval based upon evidence of safety and effectiveness. That research takes time — with the treatment’s 20-year patent clock typically ticking away throughout the approval period. This is an old issue that was addressed in the 1984 Drug Price Competition and Patent Restoration Act. However, as Lietzan and Lybecker point out – the Patent Term Extension (PTE) “doesn’t restore all of the lost time.” In particular, PTE restors 1/2 of clinical testing time (after the patent issues) and caps recovery at five years of added time. In addition, PTE cannot extend the patent more than 14 years beyond regulatory approval and can only be applied to one patent for each drug treatment listing. Note – PTE is added to any PTA term.
The new data-driven article focuses on the question of whether the partial-restoration steers research “away from drugs that take a long time to develop.”
The article looks at every PTE grant (1984-2018) and ties that grant to product to the clinical research period and launch dates of the brand and generic (if launched). Some conclusions:
Longer clinical period => shorter patent life post-approval;
Being a “child” in a family of patents => shorter patent life post-approval;
This second point seems obvious to patent-law youngsters who have always seen patent term calculated from the parent-filing-date. However, the article argues that the shorter child-life is “the opposite of what lawmakers intended in 1984.”
New use of a known compound: This decision focuses on OSI’s U.S. Patent 6,900,221 — a method for treating non small cell lung cancer (NSCLC) with the drug erlotinib (sold by OSI as Tarceva). In the US dosage is about $200 per day that continues “until disease progression or unacceptable toxicity.”
44. A method for the treatment of NSCLC … comprising administering to [a] mammal a therapeutically effective amount of a pharmaceutical composition comprised of at [erlotinib] and a carrier.
Apotex petitioned the USPTO to cancel several claims, including Claim 44 so that it could begin marketing a generic version. The PTAB agreed to hear the case and eventually cancelled the claims — finding them obvious when laid next to a prior patent (Schnur) in view either of an academic review article on anticancer drug targets (Gibbs) or OSI’s own 10-K (OSI SEC filing).
Schnur lists Erlotinib as a preferred compound for treating cancer in mammals — and note that the class of drugs (erbB) is good for treating human tumors, including “renal, liver, kidney, bladder, breast, gastric, ovarian, colorectal, prostate, pancreatic, lung, vulval, thyroid, hepatic carcinomas, sarcomas, glioblastomas, various head and
neck tumors.” (Lung emphasized in the court decision, but not in the original prior art). Schnur discloses lung cancer treatment – but does not particularly discuss “non small cell lung cancer.”
Gibbs is a review of prior publications and makes the conclusion that erlotinib (and a parallel compound) “appear to have good anti-cancer activity in preclinical models … particularly in patients with non-small cell lung cancer.” However, when the Federal Circuit looked-into the articles cited by Gibbs — none of them provided any “data regarding the use of erlotinib to treat NSCLC.” OSI also hired Gibbs to provide a declaration that he was “not aware of any published abstracts or articles describing the clinical or preclinical response of a NSCLC tumor to [erlotinib] that were available as of the time my article was published, and I reviewed no such abstracts or articles in drafting my article.”
The SEC Filing by the patentee is a prior printed publication from more than 1 year before OSI’s filing date. The Filing states that the company is pursuing research on Erlotinib “which targets a variety of cancers including ovarian, pancreatic, non-small cell lung and head and neck. . . . [The drug] is a potent, selective and orally active inhibitor of . . . a key oncogene in these cancers.” The SEC Filing also indicates that Phase I safety trials had been completed and Phase II clinical trials were ongoing. The SEC filing does not include any “DATA.”
For the Board, the combination of these references rendered the broad claim 44 obvious — the claim just requires administration of “a therapeutically effective” of the drug and a carrier.
On appeal, however, the Federal Circuit has reversed — holding that the references did not create a “reasonable expectation of success.” As such, the Board’s factual conclusion was not supported by substantial evidence.
Over the past several years, the Federal Circuit has been rebuilding its obviousness doctrine post-KSR. The court now asks two key questions of fact: would a person of ordinary skill in the art (1) have been motivated to combine/modify the prior art teachings in order to make the invention; and (2) have had a reasonable expectation of success in doing so.
The combination of references state rather plainly that erlotinib is believed to has anti-cancer activity against non-small cell lung cancer and that the drug is safe (enough). On appeal, however, the Federal Circuit rejected the obviousness claim because the prior art did not provide any evidence that the drug would work in humans. “These references thus contain no data or other promising information regarding erlotinib’s efficacy in treating NSCLC.” In its explanation, the court notes that this area is “highly unpredictable” — 99.5% failure rate of NSCLC treatments entering Phase II.
The court concludes with a caveat — attempting to cabin-in this ruling:
To be clear, we do not hold today that efficacy data is always required for a reasonable expectation of success. Nor are we requiring “absolute predictability of success.” We conclude only that, on these particular facts, a reasonable fact finder could not find a reasonable expectation of success. The Board’s finding is thus not supported by substantial evidence, and accordingly we reverse its obviousness determination.
The decision here has a substantial amount of merit.
What gives me a lump in my throat is that the prior art discloses almost exactly what was claimed in these broad claims — with the addition of the functional language “therapeutically effective” amount.
American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (Fed. Cir. 2019)
This case focuses on Neapco’s U.S. Patent 7,774,911 that D.Del. Judge Stark found to lack eligibility. On appeal a divided panel has affirmed — with Judges Dyk and Taranto supporting invalidity and Judge Moore writing in dissent.
The ‘911 patent covers a method of manufacturing a drive-shaft assembly with an internal-liner that is designed to reduce vibration problems. Yes – the method of manufacture is not patent eligible because it is directed to a law of nature.
One way to see this case is as a battle between Parker v. Flook and Diamond v. Diehr. The majority follows Flook and finds the patent is invalid. As suggested below, the issue here also looks like Halliburton — where the patent “conveniently” uses functional language at the point of novelty. The majority also suggests – but does not decide – that the claims lack enablement and written description.
Essentially, the claim are directed to functional improvement in drive-shaft technology — a drive shaft with an internal liner that has 2-way damping. However, the claims do not require a particular approach to achieving the damping result. Further, according to the majority, the specification does not provide enough guidance to let readers know that something real (beyond a law of nature or abstract idea) is being claimed.
Claim 1 at issue:
A method for manufacturing a shaft assembly of a driveline system … adapted to transmit torque …, the method comprising:
providing a hollow shaft member;
tuning at least one liner to attenuate at least two types of vibration transmitted through the shaft member; and
positioning the at least one liner within the shaft member such that the at least one liner is configured to damp shell-mode-vibrations in the shaft member by an amount that is greater than or equal to about 2%, and the at least one liner is also configured to damp bending-mode-vibrations in the shaft member,
the at least one liner being tuned to within about ±20% of a bending mode natural frequency of the shaft assembly as installed in the driveline system.
Drive shaft technology has been around for a long time and the subject of many patents. One of the earlier U.S. patents is this 1861 Mower Machine (U.S. Patent No. 32,908). Throughout this time, a common problem has been vibration control and various solutions have been the subject of hundreds of patents.
In this case, the core innovation disclosed in the ‘911 patent is that the shaft-liner has been attuned to dampen two types of vibration (shell mode and bending mode) and the patent provides several example shaft liner designs to accomplish this goal:
Critical Over Claiming: Rather than claiming these particular liner shapes, the patent claims a liner that is “attuned” so as to have a particular dampening profile. This is the patentee’s critical error. In addition, the patent does not claim a particular method for attunement — just the functional result. In considering what’s being done here, the Federal Circuit found that the claim is broadly directed to the broad physics principles associated with vibrational frequency and dampening of vibrations:
[The claims] simply state that the liner should be tuned to dampen certain vibrations. Thus, the problem is that the claims’ instruction to tune a liner essentially amounts to the sort of directive prohibited by the Supreme Court in Mayo—i.e. “simply stat[ing] a law of nature while adding the words ‘apply it.’” . . . [T]he mechanisms for achieving the desired result—are not actually claimed.
Since drive shafts and internal liners were already known in the art, the majority found nothing-new there — no inventive step sufficient to transform the abstract idea into a patent eligible invention.
Judge Moore’s dissent is a good read and I’ll save a post on it for this weekend.
OK, here is an important case: Athena Diagnostics, Inc. v. Mayo Collaborative Services, LLC, Docket No. 19-430 (Supreme Court 2019). In its new petition, Athena asks — did the Supreme Court really intend to bar patenting new diagnostic methods absent creation of new technological equipment? [Petition for Writ of Certiorari][Appendix].
At issue are Claims 7-9 of Athena’s U.S. Patent No. 7,267,820. The district court dismissed Athena’s infringement complaint — finding the claims ineligible. That decision was reluctantly affirmed by the Federal Circuit. The appellate court then denied en banc review — with eight separate opinions from the 12-member court. In its Supreme Court petition, Athena now presents the question as follows:
The question presented is: Whether a new and specific method of diagnosing a medical condition is patent-eligible subject matter, where the method detects a molecule never previously linked to the condition using novel man-made molecules and a series of specific chemical steps never previously performed.
[Petition].
The invention process in this case started with the reality that the biological cause of Myasthenia gravis (MG) could be identified for only about 80% of patients. The inventors here discovered that a substantial portion of those “unknown cause” patients generated autoantibodies to “muscle-specific tyrosine kinase” (MuSK). MuSK was previously known as a naturally occurring human protein. Although the autoantibodies to MuSK were not previously known, but do naturally occur in individuals with the condition. The key discovery of the inventors is the link between the autoantibodies and the particular form of MG. Under Mayo v. Prometheus, that link is an unpatentable law of nature.
After discovering the link, the researchers designed and then patented a method of finding those MuSK antibodies to help diagnose the particular form of MG. Since the autoantibodies were not easy to directly detect, the claims requires that a lab first tag MuSK proteins with a radio-label (such as Iodine-125) and then mix the proteins with body fluid. If the autoantibody is present in the fluid then it should bind with the tagged-MuSK. At that point, you immunoprecipitate any antibody/MuSK complex and look for the label in the precipitate. The patent explains that these steps are well known in the art – “Iodination and immunoprecipitation are standard techniques in the art.” However, they had never been done with MuSK and its autoantibody. At that tight level of granularity, these steps could be called “a series of specific chemical steps never previously performed” as they were in the petition.
If you think that Myriad Genetics might provide insight to this case, it will also be important to recognize that radio-labeling MuSK actually creates a new molecules — “novel man-made molecules.”
Claims 7-9 of Athena’s U.S. Patent No. 7,267,820 are at issue. These depend from a very broadly written claim 1 that Athena did not defend on appeal. Claims:
1. A method for diagnosing neuro … disorders related to [MuSK] comprising: … detecting in a bodily fluid … autoantibodies to … MuSK.
7. A method according to claim 1, comprising
contacting [labelled] MuSK … with said bodily fluid,
immunoprecipitating any antibody/MuSK complex … from said bodily fluid and
monitoring for said label on any of said antibody/MuSK complex …,
wherein the presence of said label is indicative [of the disorder]
8. A method according to claim 7 wherein said label is a radioactive label.
9. A method according to claim 8 wherein said label is [Iodine-125].
I’ve unfortunately been reminded of Dickens multiple times this week. The Dickens link with this brief comes in the form of melodrama. The following comes from the petition introduction:
[T]he Federal Circuit issued an unprecedented cry for help from this Court to clarify the patent eligibility of medical diagnostic tests. This Court should heed that cry and provide much-needed guidance on the proper application of the judicially-created exceptions to Section 101 of the Patent Act. . . .
[Among members of the Federal Circuit] there was broad consensus that this Court’s review is desperately needed. Numerous government officials, practitioners, and scholars have echoed and amplified the message that the law of patent-eligible subject matter is in a state of turmoil and there is no more important question facing the patent system. . . .
If these claims do not even meet the threshold requirement of being the kind of subject matter eligible for patent protection, that is the end of patent eligibility for the overwhelming majority of medical diagnostic methods—leading to profound consequences for future investment in scientific research and public health.
It actually took me quite a while to write this post — I must have fainted from simply reading the introduction.
Seriously though – this is an important issue. The Federal Circuit judges agreed that this is the type of invention that SHOULD be patent eligible, but is NOT patent eligible. The Supreme Court should also recognize that its action (or inaction) in this case will likely be followed-up by Congressional action — as such a well reasoned opinion would go far to smoothing that process.
Guest post by Colleen V. Chien, Professor, Santa Clara University Law School. This post is the third in a series about insights developed based on USPTO data.
“If we could further narrow this gap in prior art between examination and litigation, then the accuracy of the patent grant – and therefore, its reliability – would increase.”
As Congress charts its path for the rest of the year, many in the patent community are eagerly awaiting new legislation on patentable subject matter. But to the extent that the Supreme Court’s jurisprudence can be understood as a clumsy response to the proliferation of weak patents, reversing these decisions will not address the underlying root causes of poor patent quality. It is therefore crucial to address the question raised at a recent Hearing before the Senate Subcommittee on Intellectual Property: how can the quality of US patents be ensured?
This post focuses on an aspect of patent quality that, though receiving scant focused attention by scholars (with some exception, such as the excellentwork of Professor Steve Yelderman, now clerking at the Supreme Court), comes up in the examination of over 90 percent of all patent applications.[1] No other issue comes close: the USPTO reports that only about a third of office actions include a rejection based on 35 U.S.C. § 112 and just 11% percent receive a rejection based on § 101. The aspect is the robustness of prior art vetting under §§ 102 (novelty) and 103 (nonobviousness). Below I argue that policymakers should pay more attention to the patent system’s most important tool for ensuring a patent’s quality: not § 101 or inter partes review, but prior art.
The task of vetting inventions in view of the prior art is old, but there are a number of new challenges. As Director Iancu has repeatedly acknowledged, the “ever-accelerating publication and accessibility explosions” strain the ability of examiners to find the best prior art during examination. Foreign patenting, which creates harder-to-evaluate foreign language prior art, is on the rise. In areas of rapid development like artificial intelligence, not unlike the early days of software in which a President’s Commission recommended prohibiting software patents because of the inability to vet them, prior art is being generated at an extraordinary rate – but in repositories like arxiv.org or Google scholar, not necessarily in filings at the Patent Office. As part of its continued focus on prior art, the Office has multiple initiatives to improve access to prior art, including the Collaborative Search and Search Feedback Pilots. It’s asked about prior art in its recent call for comments about patenting artificial intelligence (deadline extended to 11/8). But how can we know if current or piloted approaches are enough?
In a recent paper, Comparative Patent Quality, I argue that the age-old tool of benchmarking can yield valuable insights for tracking quality in patent examination, and in particular the robustness of considered prior art. In it, I describe and apply an approach for benchmarking examiner citation patterns exploiting the natural experiment that occurs when the same application is filed in the USPTO and a foreign patent office (such as the European Patent Office (EPO)). The paper specifically considers the extent to which examiners are considering the full range of prior art—not just patents but also non-patent literature (NPL)—when vetting applications.
A second project, Rigorous Policy Pilots, considers two other prior art benchmarks. The first is the patent applicant’s Information Disclosure Statement (IDS), in which an applicant must disclose to the USPTO all of the prior art or other information of which she is aware material to her application. Another is the Patent Trial and Appeals Board’s inter partes review decisions, in which administrative law judges cite what they believe to be the most relevant prior art.
These papers validate and quantify what Director Iancu has called, the “gap between the prior art found during initial examination and the prior art found,” in this case, in inter partes review. Non-patent literature (NPL) is not being cited by US examiners in the majority of cases, and US examiners are citing it less than European examiners. Within a random sample, 3.2% of the prior art relied upon by a U.S. Examiner (as provided in an 892 Form) was non-patent literature while the comparable rate in European Patent Office cases (as an X or Y reference in the search report) was 20%.[2]
Figure 1 shows the gap in NPL citation rates among Examiners, PTAB judges, and applicants vetting the same invention (906 patents whose claims have been invalidated in inter partes review). While US Examiners cited non-patent literature on average 13% of the time, the PTAB was more than three times more likely to do so (41%). (Figure 1) Applicants were more than five times (66%) more likely to include NPL in an IDS than Examiners (13%) were to cite it. Though the sample size does not permit fine-grained comparisons, the basic finding – that US examiners are citing NPL far less frequently than PTAB judges or applicants – held across all technical centers.[3]
These comparisons have their limits: in inter partes review, the challenger, not Examiner supplies the prior art, and the patents of IPR are not representative of patents in general. An applicant’s inclusion of a reference in an IDS is very different than an Examiner’s consideration, then application of a reference. European examination is closer to US examination, however, and there’s also a gap, though it’s smaller: among the patents analyzed above that had a European counterpart, EPO examiners cited NPL at a 34% rate, more than double the US examiner rate on the same applications of 14% of the time.[4] But applicants do not necessarily treat European and US “twin” applications identically, and European patent law is not identical to US patent law. Perhaps most importantly, correlation does not imply causation, and it can’t be assumed from these contrasts that a lack of robust vetting is responsible for the issuance of patents later proved to be invalid.[5]
Still, because inter partes review only revisits the patent’s validity in light of the prior art under §§ 102 (novelty) and 103 (obviousness), it squarely presents the question, were there references that the examiner missed? This analysis suggests that the robustness of examiner-cited prior art in general, and the consideration of NPL in particular, deserves attention. Work is ongoing to tease out the differences and their relationship to quality not only according to this metric, but also other aspects of robustness pertaining for example to foreign patents and the classes from which patent citations are drawn.
What can the USPTO do now to pay more attention to the robustness of prior art and narrow the gap? I recommend a few steps. First, the Office should make the “robustness of the prior art considered,” whether measured by NPL citation, foreign patent citation, diversity of references, or other measure, an explicit quality metric within existing and future prior art initiatives, consistent with the Office’s commitment to continuous improvement. Studying the link between the robustness of cited prior art and quality and tracking this explicitly as a quality metric would signal the importance of this aspect of prosecution.
Second, the USPTO, as it seeks to leverage artificial-intelligence to improve examination, should take into account the “bias” against non-patent literature currently embedded in examiner citations. If a tool is trained primarily on examiner citations it will reinforce this bias, growing, not narrowing, the gap. As to artificial intelligence applications in particular, the USPTO should also work to ensure that US examiners have access to the same references and resources (including time and information) that those in industry[6] and their international counterparts do. With many AI patent applications coming from non-US sources, high patent quality now can protect freedom to operate later, for US innovators.
Second, as the USPTO continues to evolve its approach towards prior art, including through pilots, it should do so with an eye towards rigorous evaluation. This means explicitly identifying the goal of the piloted policy (the “treatment,” like enhanced search capabilities or examiner collaboration), the theory of change behind it, and a way to measure whether or not the approach being tested has succeeded in increasing the robustness of prior art cited, using experimental or quasi-experimental approaches. To see if a new approach is working, the Office would compare the robustness of art in applications receiving and not receiving the treatment.
While treating otherwise identical applications differently can present non-trivial challenges, existing caselaw and the experiences of agencies including the USPTO, in its own randomized trademark audits, suggest that they are surmountable and the resulting knowledge, well-worth pursuing. The “hard evidence” generated by a rigorous policy pilot, implemented with sufficient power and controls, could be particularly important for justifying changes, perhaps costly, to examination and prior art processes. More importantly, applying rigorous approaches to prior art pilots would do more to support the discovery of what works to advance patent quality, using the patent system’s most important tool for doing so: prior art vetting.
Thanks to research assistant Nick Halkowski, 3L at SCU Law, for providing excellent data support.
[1] Author’s analysis, using the USPTO Office Action Dataset.
[3] Across all TCs except TC2800, where the gap was 17%, the gap between Examiner and PTAB NPL citation among the 906 invalidated patents was of 20% or more . (N=74-186).
[5] While several excellent studies of patent quality have considered the role of prior art including Wasserman and Frakes’ studies of the time devoted to patent examination, and work by my colleagues Professors Brian Love and Christian Helmers uncovering the determinants of quality, none of that I am aware has explicitly considered the “gap”, or “relative” citation of non-patent literature citation by US examiners, as compared to PTAB judges, judges, applicants, and EPO examiners as is contemplated by this analysis. Some evidence suggests that the robustness of US examiner vetting, relative to EP examiner vetting, may have implications for outcomes. Among the US patents granted by the USPTO but fully invalidated in IPR, 202 had an EPO counterpart application. Of these, approximately 1/3 of the EPO applications never matured into patents, primarily because they were withdrawn or revoked. But while applications that did not proceed in the EPO but were granted in the US were 30% more likely to have NPL cited in the search report than their US counterpart, the difference in non-patent literature citation among cases where both offices granted the patent was much smaller, a third of that or 10%.
On Arkema’s request, the PTAB initiated a post grant review against Honeywell’s U.S.
Patent 9,157,017 (“method for producing an automobile air conditioning system for use with 2,3,3,3-tetrafluoropropene”). (Filed 4-months after patent issuance).
The patent includes a priority chain that goes back to 2002 and Honeywell thus argued that the patent was not amenable to PGR review. However, it turns out that Honeywell had a mistake in its priority chain listing — having forgotten to add one additional filing to its priority chain. Honeywell then asked the PTAB for permission to petition the PTO Director for a Certificate of Correction under Section 255.
Whenever a mistake of a clerical or typographical nature, or of minor character, which was not the fault of the [PTO], appears in a patent and a showing has been made that such mistake occurred in good faith, the Director may, upon payment of the required fee, issue a certificate of correction, if the correction does not involve such changes in the patent as would constitute new matter or would require re-examination.
35 U.S.C. § 255
Honeywell admitted that the error was not clerical or typographical and Arkena argued that it was a major change to the patent — “not proper grounds for correction.” Honeywell argued good faith — that discovered the error only after institution, and there is no suggestion that the lack of priority claim benefited the patentee in any way — just a big mistake.
To be clear about PTAB procedure — before filing a motion , you first have to get permission (leave) to file the motion. Here, Honeywell asked PTAB for permission to file a motion for leave from the PTAB to file a petition for correction. The Board did not give permission — rejecting Honeywell’s request for leave. In the process, the Board agreed with Arkena’s “not-minor” arguments and that the correction could prejudice the petitioner. The Board subsequently cancelled the claims – finding that without the priority chain, the late-filed claims are anticipated by intervening prior art.
On appeal, the Federal Circuit has vacated and remanded — holding that the PTAB should allow the Certificate of Correction petition. In particular, the court found that the PTAB had “abused its discretion by assuming the authority that 35 U.S.C. § 255 expressly delegates to the Director: to determine when a Certificate of Correction is appropriate.
Section 255 does not grant the Board authority to determine whether a mistake in an issued patent is of “minor character” or “occurred in good faith.” 35 U.S.C. § 255. That authority is expressly granted to the Director. Id. The Director has not delegated its Section 255 authority to the Board, but has instead promulgated procedures by which patentees may seek the Board’s leave to petition the Director for a Certificate of Correction. 37 C.F.R. § 1.323; MPEP § 1485.
The Federal Circuit has held that it is appropriate for the PTAB to require “sufficient basis” supporting a correction request before granting permission to petition the PTO Director. The basic idea is that the correction process could slow-down the PTAB trial. In this case, however, the PTAB went to far because it did not allow Honeywell to file a motion explaining its case.
By requiring that Honeywell “show that [the] requirements of 255 have been met” before authorizing Honeywell to file a motion for leave to seek a Certificate of Correction from the Director, the Board abused its discretion. The Board further abused its discretion by assuming the authority that § 255 delegates to the Director and deciding the merits of Honeywell’s petition for a Certificate of Correction. . . .
[B]y evaluating the merits of Honeywell’s § 255 request when Honeywell was merely requesting authorization to file a motion for leave to petition the Director, the Board “lacked the information necessary to make a reasoned decision.” [Quoting Ultratec] At that stage, the Board had not seen the language of Honeywell’s proposed correction to the priority chain language of the ’017 patent. Nor had the Board seen any evidence of whether the mistake was inadvertent and made in good faith or whether the correction prejudiced Arkema.
The Board also failed to provide an explanation or a reasoned basis for its decision. The Board provided no explanation for its conclusion that Honeywell “failed to show that the minor character prong has been met” or its conclusion that prejudice to Arkema required denial of Honeywell’s request to file a motion.
Slip opinion. On Remand, the Federal Circuit ordered the PTAB to now allow “Honeywell to file a motion seeking leave to petition the Director for a Certificate of Correction.”
This is a response to Prof. Golden’s A Walk in the Deference Labyrinth: Further Comment on Facebook v. Windy City, Patently-O (Sept. 27, 2019). In my view, Prof. Golden overlooked some things (the same things overlooked by the PTO in its brief). When those additional factors are clearly in view, Prof. Golden’s labyrinth falls into nice straight lines of sight showing that the Chevron deference issue in Facebook v. Windy City is no labyrinth at all: the PTAB’s Proppant decision is not entitled to Chevron deference.
I’m looking forward to being part of the upcoming Patent Open Data Conference at USPTO-Detroit – hosted by Regional Director Damian Porcari. Attend in person or via web. Sign-up to join the conversation:
by Dennis Crouch
