Patent Law Year in Review

by Dennis Crouch

I just gave a short (45 min) talk about the past year in patent law. See the slides here: Patent Year in Review.  Key points:

  1. Director Review and Ex Parte Lobbying: Exercising the constitutional right to petition the government via shadow request for director review.
  2. Full Scope Enablement and Written Description: Increased focus by both the USPTO and the Federal Circuit.  Pending SCOTUS cases of Amgen v. Sanofi and Juno v. Kite.
  3. Patents as Commodity: Many folks are treating it as such.
  4. Broad IPR Estoppel: CalTech v. Broadcom/Apple.  Pending before the Supreme Court.
  5. Who is the Inventor: AI and Corporation as the inventor.  Thaler v. Vidal cert petition likely in January 2023.
  6. Eligibility: Tropp and Interactive Wearables are not great vehicles for Supreme Court review.  Hopefully IBM petitions its case from IBM v. Zillow.
  7. Patent Venue: Lots still happening in W.D.Tex.  IMO, parties arguing inconvenient venue don’t really care about convenience. Their basic concern is that they want to escape from Judge Albright’s courtroom and raise costs on the patentee.

22 thoughts on “Patent Law Year in Review

  1. 6

    >>Patents as Commodity: Many folks are treating it as such.

    I’ve been saying this for years. The in-house counsel now treat patents like a commodity.

    1. 6.1

      A patent seems more like a non-fungible token (NFT) than a pure commodity

    2. 6.2

      The essence of a “commodity” is that one can buy essentially any quantity of the good at a common, well-know price. At any given moment there is a spot price for a barrel of west Texas crude oil, for a bushel of winter wheat, for a ton of steel (etc.) because these are all commodities.

      Is there a market price for an unspecified dozen patents? Can one just call one’s broker and say “I want 100 patents,” and the broker will say “100 patents will cost €1537 on the Brussels exchange right now”?

      If not, in what sense are we talking about a “commodity”?

  2. 5

    Having talked about this a fair bit with a bunch of plaintiff’s counsel, it’s not about increasing cost. Judge Albright’s shadow docket and discovery rulings are unpredictable for both parties involved. It’s more about generating uncertainty, quickly—something a fair amount of smart investors don’t want either. So you get a lot of more serious plaintiffs and funders headed to the Eastern, where they expect speed and certainty (and that their judgments will hold up on appeal). The majority of the Western District stuff by the numbers is file-and-settle stuff that benefits from less certainty—cases filed by Bill Ramey are a prime example (and a massive part of the docket). It cuts both ways, often against serious plaintiffs as much as for them.

    1. 5.1

      An interesting rebuttal,* JRS, of the Dennis conjecture that “in W.D.Tex .. parties arguing inconvenient venue don’t really care about convenience. Their basic concern is that they want to escape from Judge Albright’s courtroom and raise costs on the patentee.” But there have been only a handful of successful efforts to “get out of Dodge” [Waco] on contested venue grounds, and another reason to “care” is to be able to get an IPR decision before incurring high discovery and other litigation costs burdens.
      Your additional view that: “The majority of the Western District stuff by the numbers is file-and-settle stuff” seems supported by the absence of appeals to the Fed. Cir. from final decisions there?
      *[Generating uncertainty for PAE investors]

  3. 4

    No surprise to me, given the step change in philosophy, from First to Invent to First to File, that there is, these days, “increased focus” on WD. It’s inevitable.

    Looking in from Europe, I don’t know what it means to be “in possession” of the full scope of the claimed invention but I’m not expecting anybody (least of all the Justices of the Supreme Court) to spell it out for me any time soon.

  4. 3

    Great work Professor. You are spot on with the PTAB political influence observation. It is out of control. Failed experiment. Capable lawyers should join inventors in lobbying for abolishing the PTAB. Only second rate lawyers prefer the PTAB, as their work product is likely to pass muster there, where second rate judges are receptive and get paid well for parroting their arguments.

    1. 3.1

      “second rate judges”

      And even at that, you’re being too kind, Josh.

      Indeed, to anoint them “judges” at all is a grave disservice to real, U.S. Court Judges.

  5. 2

    Can you clarify what you mean by “patents as commodity”? A particular example might help.

    1. 2.1

      Dozens, is this not just a suggestion that the sheer number of patents in one’s portfolio counts for more than the “quality” of any one patent in the quiver. Look at Slide 2 of Dennis’s presentation. Most every patent has 20 claims, these days, which suggests to me that claim drafting to do justice to the invention takes second place to the importance of paying no claims fees to the USPTO. Further, one hears from colleagues that corporations who would hitherto have initiated enforcement through the courts are ever more inclined to eschew litigation, preferring to settle the dispute through alternative channels. It used to be that the pharma sector dominated patent litigation, a sector associated with individual “blockbuster” patents. Not any more though. Does IBM, for example, treat patents as a commodity? Does Musk? Zuckerberg? Bezos? Microsoft? Apple? I assume so. Who does Dennis have in mind, when he writes “folks” are thinking that patents have become a commodity? Investors and their advisors, perhaps?

      1. 2.1.1

        is this not just a suggestion that the sheer number of patents in one’s portfolio counts for more than the “quality” of any one patent…

        This very much depends on the client – as it always has been so.

      2. 2.1.2

        Look at Slide 2 of Dennis’s presentation. Most every patent has 20 claims, these days, which suggests to me that claim drafting to do justice to the invention takes second place to the importance of paying no claims fees to the USPTO.

        Your reasoning is rather pitiful.

        There well may be a certain amount of some claims being less-well-written, but as the graph you reference clearly shows an increase in claims from both mode and median.

        The FAR more reasonable suggestion is that a 3/20 set has been paid for, so one might as well have those numbers of claims.

        Or were you up to your old throw C R P against the wall to see what sticks mode?

      3. 2.1.3

        Does IBM, for example, treat patents as a commodity?

        Worse than commodity now.

        In an announcement last year (explaining their NOT taking a ‘numbers crown’), IBM indicated that they l would be gauging their own innovation metrics by other means and that patent count was no longer a driver.

      4. 2.1.4

        Thanks, Max. That is a helpful response. Certainly does not jibe with my experience in pharma, but good to know.

    2. 2.2

      Greg (I-Use-My-Real-Name-Except-When-I-Don’t) Dozens DeLassus is – yet again – inserting his hidden hyperlinks (the “t” in “might”).

      This time with a mindless Leftist tweet attempting to smear Dr. Lindsay.

      Funny how Greg will do this, and has never yet actually addressed any of the substantive points to which Dr. Lindsay’s teachings have been advanced on this blog.

      So why IS ‘mr.up and up’ resorting to this type of posting and just to whom is Greg signaling?

      (as if it matters, and let’s be clear, Greg’s posts do NOT matter)

    3. 2.3

      > Can you clarify what you mean by “patents as commodity”?
      > A particular example might help

      This is presumably referring to the fact that some companies (often big tech companies) prosecute and stockpile a large number of patents that are not particularly important to their businesses. These patent applications are often hastily drafted and prosecuted (often with very limited budgets), and if they issue, the company knows they’re not likely to ever be asserted against anyone or even used in any licensing discussions.

      Perhaps the clearest example of what many would call a “commodity” approach to patents was IBM (although IBM has reportedly changed its patent policies in recent years). But in the 1990s and early 2000s, it seemed that IBM would file patent applications on just about anything, no matter how silly or worthless. Many of these patent applications made national headlines and were embarrassing for IBM, leading to public disclaimers (such as IBM’s infamous attempt in 2006 to file a business method patent on outsourcing of services, or its equally infamous 2000 patent application for determining (on a “first-come-first serve” basis) who gets to use a restroom on a boat or airplane). IBM was also well-known for letting a large percentage of its issued patents lapse for failure to pay maintenance fees, which also suggests a clear lack of value to those patents to the company. In fact, Dennis covered this in an article more than a decade ago:

      link to patentlyo.com

      But the “commodity” label is never complete nor universal, even for companies like IBM. Even companies like IBM will have a subset of its patents that are important to its core business, and those patents tend to be higher quality, well-written, and are suitable for use in litigation or licensing negotiations with third parties.

      1. 2.3.1

        I am obliged to you for this response. If, however, this is what Prof. Crouch meant when he chose the word “commodity,” then it was a poor word choice. You are describing “bilge” or “garbage,” neither of which are “commodities.” Commodities get bought and sold in an undifferentiated manner. Why would anyone buy that which is as unambiguously worthless as that which you are describing?

        1. 2.3.1.1

          Greg,

          “Commodity” is understood and is neither of how you are trying to define it.

          Maybe stop and realize that the rest of the world operates differently than you.

        2. 2.3.1.2

          Commodity here is used to differentiate from something of high value. As noted by others, total volume is more important rather than individual value. For example, venture capital firms like to see a high number of patents, regardless of strength of individual patents, for start-up companies they are considering investing in. It serves as a proxy for breadth.

  6. 1

    IMO, parties arguing inconvenient venue don’t really care about convenience. Their basic concern is that they want to escape from Judge Albright’s courtroom…

    This sounds intuitively correct.

    … and raise costs on the patentee.

    This is not as intuitively correct. Is it not more correct to say that the plaintiff is trying to raise costs on the defendant by filing in Waco, and the defendant is just trying to set costs back to the “normal”?

    1. 1.1

      Greg reaches (and misses badly) with his ‘not intuitively correct attempt to deflate a pro-patent statement by Prof. Crouch.

      No Greg, there is no such ‘setting back to normal’ by defendants.

      How in the world would you ever come to such an odd view?

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