by Dennis Crouch

Maxill, Inc. v. Loops, LLC (Fed. Cir. 2020)f [Maxill v. Loops]

The Loops patent covers a flexible toothbrush — and the claims require “an elongated body being flexible throughout the elongated body.”  US8448285 (Claim 1). Apparently, these brushes are sold primarily to “institutional” settings such as prisons.

Early in the case, the patentee moved for summary judgment of infringement.  The district court denied the motion, and acted sua sponte to enter summary judgment of non-infringement.  Apparently, the judge had inspected the accused product and found that the head-portion of the elongated body wasn’t flexible. Although the body was made of flexible rubber, once the stiff head (with bristles) was molded-in, the body was no longer flexible.

On appeal, the Federal Circuit has reversed and remanded — finding that the district court erred in  its claim construction of “elongated body being flexible throughout the elongated body.”  The appellate court found that the flexibility requirement does not require the whole assembly to be flexible, but rather only that the elongated itself be flexible.

Loops argues that the accused toothbrush’s elongated body is made of orange flexible material that is flexible throughout (a position that Maxill does not dispute) and that this component is separate from the more-rigid head component. . . . We agree with Loops and conclude that, based on the claim language and structure, as well as the specification, the district court misunderstood the flexibility limitation to pertain to the elongated body when combined with the head as opposed to the elongated body alone. . . . Reversed.

Slip. Op. Read the claim and tell me what you think? Does the body need to be flexible when assembled, or only pre-assembly?

1. A toothbrush, comprising:

an elongated body being flexible throughout the elongated body and comprising a first material and having a head portion and a handle portion;

a head comprising a second material, wherein the head is disposed in and molded to the head portion of the elongated body; and

a plurality of bristles extending from the head forming a bristle brush, wherein the first material is less rigid than the second material.

Claim 1.

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The appellate panel also took issue with the sua-sponte summary judgment without first providing the party with a “full and fair opportunity to present its case.”  Here, although Loops had presented its summary-judgment argument of infringement, the appellate panel found that summary-judgment of non-infringement to be an entirely different matter. “Under the circumstances, we conclude, Loops did not have a full and fair opportunity to respond to Maxill prior to the district court’s sua sponte grant of summary judgment.”

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I was researching old inventors, but couldn’t find the burial place of William Addis, the toothbrush inventor. . . No plaque.

by Dennis Crouch

Simio, LLC v. FlexSim Software (Fed. Cir. 2020) (opinion by Chief Judge Prost and joined by Judges Clevenger and Stoll).

In this case, the Federal Circuit has affirmed the lower court’s summary dismissal of Simio’s infringement lawsuit on eligibility grounds.  The appellate panel also upheld the lower court’s refusal to permit the patentee to amend its complaint — seeing the proposed amendment as “futile.”

Dennis Pegden has received many awards for his work developing software (and programming languages) for simulating real-life processes in order to optimize decisionmaking; perform risk analysis, etc.  He was a professor who then developed his own company that was bought-out by Rockwell. Later, he formed the new company Simio, that owns the patent at issue here: U.S. Patent No. 8,156,468.  The ‘468 patent is effectively an object-oriented simulation programming tool that allows users to develop simulation models of process flows using a graphical framework.

In December 2018, Simio sued its competitor FlexSim for infringement of the ‘468 patent; FlexSim responded with its successful motion-to-dismiss on eligibility grounds.  The district court found the claims directed to the unpatentable abstract idea of the “decades old computer programming practice of substituting text-based coding with graphical processing.”

On appeal, the Federal Circuit affirmed — finding that the claims were indeed directed to transitioning from text-based coding to icon-based.  In making its “directed to” conclusion, the court repeatedly quoted the specification’s explanations that

[A]n object in the present invention is simple and completely graphical. There is no need to write programming code to create new objects. . . . Simio™ objects can be created with simple graphical process flows that require no programming. . . . [T]his invention can bring an improved object-oriented modeling approach to a much broader cross-section of users. . . . [etc.]

Quoting the patent specification.  And, the court agreed that “Simply applying the already-widespread practice of using graphics instead of programming to the environment of object-oriented simulations is no more than an abstract idea.”

Prior decisions have found innovations that improve computer functionality to be non-abstract (and thus patent eligible). Here, the court admitted that the claimed innovation may well improve the ability of many individuals to create simulations, but found that such a usability improvement does not count as an improvement to the computer’s functionality.

[Simio’s] argument does not explain how the computer’s functionality is improved beyond the inherent improvement of the experience of a user who cannot (or maybe, would rather not) use programming.

Slip Op. Quoting Customedia, the court explained its position that “user experience” is not “computer functionality.”

Simio pointed to particular improvements of user behavior offered by its invention such as faster simulation model development (a major selling point of the products in this area). Again, the court found that an abstract idea is still abstract, even if done quickly.

In Alice Step 2, the court admitted that the claim may include novel features, but those novel features are the abstract idea.

And that’s really what we have: a claim directed to the idea of using graphics instead of programming to create object oriented simulations—maybe a new idea, but still an abstract one—and lacking any inventive concept, any meaningful application of this idea, sufficient to save the claim’s eligibility.

Slip Op.

The rules of civil procedure allow for flexible pleading. Rule 8 simply requires “a short and plain statement of the claim.”  And, defects in a complaint are regularly fixed via amendment.  The rules of Civil Procedure require courts to “freely give leave” to amend pleadings “when justice so requires.”

Here, the district court refused to allow the patentee to amend its pleadings with specific allegations regarding the uniqueness of various claim elements.  On appeal, the Federal Circuit affirmed — finding that the proposed amendment were “conclusory statements” to be disregarding when ruling on a Rule 12(b)(6) motion.

Simio had delayed in its request to amend until after the deadline set by the district court in the R. 16(b) scheduling order.  On appeal, the Federal Circuit found that the district court was within its rights to deny amendments after that deadline absent presentation of good cause. Here, the court’s granting of the motion-to-dismiss didn’t count as good cause.

by Dennis Crouch

The Boeing Company v. Air Force (Fed. Cir. 2020)

This is a government contract case involving rights to technical data provided to the government from a contractor.  Boeing is working on a multi-billion-dollar F-15 Eagle Passive/Active Warning Survivability System (EPAWSS) project subject to a DoD contract.  Under the contract, Boeing “retains ownership” of the technical data it generates and delivers.  However, the U.S. Gov’t receives also “unlimited rights” to the data, including the right to “use, modify, reproduce, perform, display, release, or disclose [the] technical data in whole or in part, in any manner, and for any purpose whatsoever, and to have or authorize others to do so.”

When Boeing began providing data, it included first notice below.  The U.S. Gov’t. objected to that language and Boeing offered the second alternative. Still though the U.S. Gov’t. objected as out of compliance with the DoD regulations. (DFARS 252.227-7013(f)).  This objection apparently came as something of a surprise — Boeing says that it has been marking its technical data with propriety legends since 2002.

Boeing wanted to retain its limitations on use and further disclosure by “Non-U.S. Government recipients” and so petitioned to the Armed Services Board of Contract Appeals (ASBCA).  After losing, Boeing brought its appeal to the Federal Circuit.  On appeal here, though the Federal Circuit has reversed.

This is a contract dispute that focuses on the DoD regulations because they were incorporated into the contract.  The regulations strictly limit they ways that a Contractor can “assert restrictions on the [US] Government’s right[s].”  Here, the Federal Circuit drew a fine-point — finding that Boeing’s restrictions are expressly designed to restrict only non-US-Governmental parties. Although the regulations state that “All other markings are nonconforming markings,” the court held that that statement as only applying to markings that restrict US governmental rights.

Thus, we agree with Boeing that Subsection 7013(f) … is silent on any legends that a contractor may mark on its data when it seeks to restrict only the rights of non-government third parties.

Slip Op.

Anyone savvy will note that if the US government has “unlimited rights,” then those rights would include the full right to release, disclose, our otherwise authorize a third-party to use the data. Boeing’s modified proposal takes this into account — stating that third-parties use must be authorized either by Boeing or the U.S. Gov’t.  However, the Gov’t still argues that its rights are being restricted because it requires the Government to be the “authorizer” — something potentially quite burdensome and “inconsistent with its unlimited rights.”  On remand, the Board may consider this issue.

In its decision, the Federal Circuit walks through a set of light policy arguments as well:

Boeing asserts that the Board’s interpretation of Subsection 7013(f) will have far-reaching consequences that will impair contractors’ abilities to protect their rights in their technical data and threaten the willingness of technology innovators to do business with the government. The government responds that allowing contractors unbridled freedom to mark technical data with self-created legends of their choosing is inconsistent with the DFARS and would encumber unrestricted information with unclear markings that make it difficult for the government to exercise its license rights.

To be clear, neither party presents any policy arguments that would be sufficient to overcome the plain language of Subsection 7013(f), as explained above. In any event, we decide this case on the regulation, not policy. … But our interpretation of the plain language of Subsection 7013(f) has the added benefit of alleviating some of Boeing’s policy concerns.

Id.

Technical Data Rights: The underlying question, of course, is what rights are we talking about? The US does not have a category of property rights known as “technical data rights.”  The best data protection may be trade-secret rights, but that does not seem to work here because we’re talking about data that has been turned over to another party without any restriction.  Boeing’s copyright notice is probably the best-clue.  However, copyright protection in a document is a far-cry being the “owner” of the technical data as the court discussed.

by Dennis Crouch

Caterpillar v. ITC & Wirtgen (Fed. Cir. 2020)

Caterpillar filed a complaint with the International Trade Commission (ITC) against Wirtgen — arguing that the German manufacturer was importing infringing devices into the US.  However, the ITC found the claims invalidated by the company’s pre-filing sales.  On appeal here, the Federal Circuit has affirmed.

Caterpillar’s U.S. Patent No. 7,140,693 covers a milling machine with retractable wheels (or tracks).   The invention here was originally created by engineers at the Italian company Bitelli in the late 1990’s.  Caterpillar purchased Bitelli in 2000, the priority patent application was not filed (in Italy) until April 2001, followed by the PCT in 2002.  Bitelli had already been selling embodiments of the invention even before 2000.

Pre-AIA patent law included some geographic limits on prior art.  The on-sale bar in particularly only applied to sales in the United States.

A person shall be entitled to a patent unless — (b) the invention was … sale in this country, more than one year prior to the date of the application for patent in the United States.

35 U.S.C. 102(b) (pre-AIA). Since this is a pre-AIA patent, the pre-AIA laws apply.

During litigation, patent claims are presumed valid unless proven invalid with clear and convincing evidence.  Here, Wirtgen presented records showing the sale of two Bitelli SF 102 C machines were sold to a U.S. Customer. One in June 1999 and the other in July 2000.  The machines were apparently delivered to the Bitelli factory gates in Italy, and the customer may have brought them to America.  The July-2000 machine (or at least a machine bearing that serial number) is actually located in the U.S., but there are no historic records of its location prior to 2018.

In finding the patent claims invalid, the ITC concluded the deliveries in Italy were still “directed to the United States” in a manner sufficient to satisfy the “in this country” prong of the on sale bar “by at least July 2000.”

On appeal, the Federal Circuit has affirmed.

Sale to US Company Not Enough: Wirtgen argued that “Under black-letter law, a sale to a U.S. company is an invalidating sale under § 102(b).” On appeal, the Federal Circuit rejected that contention — “our cases do not hold that the mere fact that the sale was made to a United States company is sufficient” to be “in this country.”

Sale Directed to the US is Enough: A foreign sale can be consider a US sale if it constituted “commercial activity directed to the United States.”  Here, the court found substantial evidence to support that conclusion for the 1999 invoice:

• Buyer located in US;
• Invoice suggests that US Tariffs were due (although the same tariff number is used in EU and other countries around the world);
• Sale in US dollars;
• Description of the machine in US;
• the VAT assessment was at 0% rate — the rate used for export out of Italy and the EU. (20% for items staying in Italy); and
• No other evidence indicating that the purchase was for use anywhere but the US.

Based upon all of this, the Federal Circuit affirmed that sales were in the US for the purposes of the on-sale bar.  Note here that the court’s conception of “directed to” analysis here is similar to the Supreme Court’s test for personal jurisdiction.  A key difference though is that the on sale bar is a statutory provision and the geographic limitation has been eliminated for post-AIA (2011) patents.

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In this case, the the Italian patent application was filed in April 2001, followed by a PCT in 2002 and then the U.S. national stage in 2003. The ITC decision concluded that July 2000 was “more than a year before the application for the ‘693 was filed.”

These facts, considered collectively, are clear and convincing evidence that the Bitelli SF 102 C was “on sale in this country” by at least July 2000, more than a year before the application for the ‘693 patent was filed, thus qualifying as prior art under section 102(b).

Calendarios will note that July 2000 is less than one year before the Italian priority date of 2001.  The problem is that the pre-AIA US statute granting priority for foreign national filings expressly excluded on-sale and public-use activity from the priority claim:

[A foreign-filed application] shall have the same effect as the same application would have if filed in this country on the date on which the application for patent for the same invention was first filed in such foreign country, if … filed within twelve months …; but no patent shall be granted on any application for patent for an invention which had been patented or described in a printed publication in any country more than one year before the date of the actual filing of the application in this country, or which had been in public use or on sale in this country more than one year prior to such filing.

35 U.S.C. 119(a) (Pre-AIA). Thus, for the on-sale and public use bar, the Italian national filing does not count as priority.  A separate provision on the code allowed the PCT date to still count. Thus, for Caterpillar, the critical date is April 2001 — 1 year before the PCT filing date.

Important additional note, these quirks were eliminated in the AIA.  Public uses and on-sale activity in Italy now count as prior art.  And, the Italian priority filing counts for all purposes.

[Note – I updated this statute after re-reading pre-AIA Section 119.]

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Odd side-note.  Figure 1 of the patent document includes two versions – one with wheels 1 and one with tracks 1a.  The priority documents only included the drawing with wheels (as shown above).  During prosecution, the examiner objected to claims directed toward tracks rather than wheels (Cat’s preferred emobidment as shown in the photo below), and the patentee added the new drawing 1a in the midst of prosecution with the statement that “no new matter has been added by these amendments.”  The examiner accepted the amendment without further comment. I’m rusty on Italian reading, but I believe that the Italian priority document does mention tracks, but only as follows:

As alternatives to wheels on the machine, track units can be applied and henceforth the word “wheel” may be replaced with the word “track unit.”

[Priority Document].

Eli Lilly and Co v. Apotex, Inc. (Fed. Cir. 2020)

You don’t see this often — the district court held on summary judgment that Apotex infringes under the doctrine of equivalents.  On appeal, the Federal Circuit has affirmed – finding no error. (Nonprecedential opinion)

Lilly’s US7772209 claims a particular treatment scheme for pemetrexed disodium that includes a pre-treatment with folic-acid to avoid the harsh side-effects.  See, Crouch, Eligibility Cannot be Raised in IPR Appeal (2019).  Apotex’s product uses a slightly different salt – pemetrexed dipotassium.  Apotex needs its version to be the equivalent in order to receive drug approval, but it would prefer to still avoid infringement under the Doctrine of Equivalents.

Although Apotex (implicitly) admits that its version is an equivalent, the company argues that Lilly should be estopped from pursuing DoE infringement here because of Prosecution History Estoppel (PHE).  In particular, Lilly made a narrowing amendment to the claim term in question during patent prosecution to avoid the prior art and now seeks to reclaim that ground via equivalents.

My simplistic drawing above does the trick.  Lilly’s original patent filing did not expressly claim the use of “pemetrexed disodium,” but rather used the broader term “an antifolate.”  During prosecution, Lilly narrowed its claims to avoid some prior art — deleting the broader “antifolate” limitation and replacing it with the narrower “pemetrexed disodium.”

None of the dependent claims expressly recited Pemetrexed Disodium.  However, one original claim had limited the antifolate to “ALIMTA,” which is Lilly’s brand of Pemetrexed Disodium.  In addition, the specification noted that the “most preferred” antifolate for the practicing the invention is “Pemetrexed Disodium (ALIMTA), as manufactured by Eli Lilly & Co.”  The claim to ALIMTA was also deleted during prosecution based upon an indefiniteness rejection. MPEP 2173.05(u).

PHE: We know that a narrowing amendment made during prosecution creates a presumption of Prosecution History Estoppel that would bar the patentee from asserting infringement-by-equivalents over the surrendered subject-matter.

The district court found no surrender, and the Federal Circuit affirmed.  The first bit here is easy claim construction — the original (dependent) claim recited “ALIMTA” and now the claim recites “pemetrexed disodium.”  The district court found these to be synonymous, and the federal circuit agreed.  Apotex had argued that ALIMTA should have been seen as encompassing all forms of pemetrexed, and thus its deletion would serve as an additional narrowing amendment. The courts, however, rejected that argument based upon in intrinsic evidence within the patent documents.  This was the sole argument raised on appeal by Apotex and thus lost the case.

The court does not address PHE stemming from the bigger amendment (antifolate => pemetrexed disodium).  There was a continuation application in-between, but you “can’t use continuations to avoid fact of narrowing amendment.” Robert A. Matthews, 2 Annotated Patent Digest § 14:82.

by Dennis Crouch

Adaptive Streaming Inc. v. Netflix, Inc. (Fed. Cir. 2020)

In this non-precedential decision, the Federal Circuit has affirmed the lower court’s finding that Adaptive’s asserted claims are ineligible under Section 101. In 2019, Adaptive sued Netflix in C.D. Cal. for patent infringement.  Rather than filing its answer, Netflix immediately filed a motion to dismiss for failure to state a claim. Fed. R. Civ. Pro. 12(b)(6).  That motion was granted — case dismissed.

The patent claims a personal broadcasting system that transcribes an incoming video into a more usable format.  Us7047305 (1999 priority date).  I subscribed to Netflix back in 2001 — receiving rental DVDs in the mail each month.  Netflix has changed dramatically — and one bit of its process appears to be a user-based translation engine.

Claim 39 at issue here requires a “broadcasting server” coupled to a “processor” with the capability of transcoding an incoming video signal from a first compression format into a second compression format “more suitable” for the client device — and available in multiple video stream outputs.  A dependent claim includes the functionality of changing the compression output “in response to a change in bandwidth conditions.”

Abstract Idea: The district court identified the abstract idea here as “collecting information and transcoding it into multiple formats.”

Directed To: With regard to what the claims are directed to, the court looked to the written description coupled with the claim language to deduce the “focus of the claimed advance of over the prior art.” (quoting Solutran (2019) and Affinity Labs 2016).  Here, the court concluded that the focus of the invention is format conversion of incoming video. “The focus is not any specific advance in coding or other techniques for implementing that idea; no such specific technique is required.”

Something more: The court offered a grade for the patent’s performance under Alice Step 2: “The claims also flunk the second step of the Alice inquiry.”  In particular, the court notes the presence of “generic” hardware carrying out its common function known in the art.  That much was admitted in the specification.

Patent Spec.  Regarding novelty + obviousness, the court here reiterated that satisfying those inquiries “does not imply eligibility under § 101, including under the second step of the Alice inquiry, because what may be novel and non-obvious may still be abstract.”

In its reply-brief, the patentee argued also that the commercial success of its invention should be used as evidence of patent eligibility.

[C]ommercial success and industry recognition serves as evidence that the technology underlying the asserted patent is far from well-understood, routine or conventional, and supports that the patent claims are directed to a technological solution to a technological problem.

[Adaptive_Streaming_Inc._v._Net_21]. The court did not consider that argument – considering it forfeited because not raised in the opening brief.

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The patent here was originally owned by the dot com LUXXON, a company developing streaming services.  The patents were then assigned to an offshore holding company Hutchison Mediator (Bahamas) as part of an asset sale (part of CK Hutchison Holdings). Then WI-LAN took ownership and transferred rights to Adaptive Streaming, which appears to be a wholly owned subsidiary of WI-LAN (at least no other company owns >10%).