Patent – Patently-O https://patentlyo.com America's leading patent law blog Tue, 20 Feb 2018 17:36:41 +0000 en-US hourly 1 https://wordpress.org/?v=4.8.5 Isolating and Measuring a Natural Phenomenon https://patentlyo.com/patent/2018/02/isolating-measuring-phenomenon.html https://patentlyo.com/patent/2018/02/isolating-measuring-phenomenon.html#comments Tue, 20 Feb 2018 10:04:44 +0000 https://patentlyo.com/?p=22496 by Dennis Crouch

Ex Parte Simons, APPEAL 2016-002684 (Patent Tr. & App. Bd. Jan. 31, 2018) (Decision on Rehearing)

In this case pending before the USPTO, Australian company Haplomic Technologies is seeking to patent a method of mapping whether methylated DNA bases are cis or trans.

16. A method for improving methylation mapping, comprising,

substantially isolating a DNA molecule from the biological sample, wherein the DNA molecule is an individual metaphase chromosome or a chromatid, or a fragment obtained therefrom;

analyzing the DNA molecule to determine the presence or absence of one or more methylated bases in the DNA molecule and

determining whether any two methylated bases are present in cis on the DNA molecule.

In its original decision, the PTAB affirmed an examiner rejection – finding the claim ineligible as directed toward a natural phenomenon.  However, the patentee requested a rehearing – arguing that the PTAB had failed to properly identify the natural phenomenon being claimed.  On reharing though, the PTAB reaffirmed the decision of no patentable subject matter.

In its analysis, the Board first noted that the claims are not directed toward any transformation of the isolated DNA, but rather simply detecting its parts.  We know from prior cases that isolated DNA remains a product of nature (Myriad) and that detecting DNA sequence is also a phenomenon of nature (Ariosa).  Similarly here, the PTAB ruled:

because the DNA is methylated in its cis or trans configuration prior to isolation, and because Appellant’s claims are directed merely to determining the configuration that exists prior to such isolation, Appellant’s claims are directed to a naturally-occurring phenomenon, i.e., a “phenomenon of nature,” and, therefore, to a judicially-created exception to Section 101.

Looking to step two of the Alice/Mayo analysis, the court found that the claims were written so broadly as to preempt the entire area — and did not including any saving inventive concept application.  “In short, Appellant’s claims are directed to determining, by any means, including means well known in the art, the naturally-occurring cis or transposition of methylated sites on a sequence of isolated DNA.”

Part of the applicant’s argument here was essentially that it combined two different ineligible concepts (isolating the DNA and cis testing) to somehow leave the invention patent eligible. The PTAB though rejected that argument.

It will be interesting to see whether the patentee pushes this case to a District Court or the Federal Circuit for review. Although those options are fun, the more likely outcome is that the patentee will narrow the claims and try again. Mark Nuell at Roberts Mlotkowski argued the case for the applicant.

Docs:

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Some Laws Regarding Laws of Nature https://patentlyo.com/patent/2018/02/some-regarding-nature.html https://patentlyo.com/patent/2018/02/some-regarding-nature.html#comments Mon, 19 Feb 2018 22:48:16 +0000 https://patentlyo.com/?p=22494 United States Declaration of Independence

When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

= = =

Institutes of Justinian 2.1.1

By the law of nature these things are common to mankind—the air, running water, the sea and consequently the shores of the sea.

= = =

Georgia Code § 5-5-41.

[DNA testing permitted if . . .]  (F) The testing requested employs a scientific method that has reached a scientific state of verifiable certainty such that the procedure rests upon the laws of nature; and

= = =

La. Stat. Ann. § 15:422 (now repealed)

Judicial cognizance is taken of the following matters: . . . The laws of nature

(Note, in general, courts still take judicial notice of laws of nature).

 

 

 

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Apology to Judge Reyna https://patentlyo.com/patent/2018/02/apology-judge-reyna.html https://patentlyo.com/patent/2018/02/apology-judge-reyna.html#comments Mon, 19 Feb 2018 20:00:41 +0000 https://patentlyo.com/?p=22485 I want to pause here for a moment to make an apology to Federal Circuit Judge Reyna regarding what could easily be perceived as poor taste humor.  I continue to have the highest respect for the Judge and hope that it was not taken in offense.

Last week when I wrote about the AATRIX Software case, I included an image of Mexican actor Alfonso Bedoya from the 1948 neo-western “The Treasure of the Sierra Madre” along with a modification of the “stinkin’ badges” quote.  The quote was used again in the Mel Brooks classic Blazing Saddles.

At the time when I wrote about AATRIX, I had no conscious thought of Judge Reyna’s Latino cultural heritage. (Judge Reyna dissented-in-part in the AATRIX decision).  A few hours later I deleted the image after considering that it did not reflect well on either myself, Patently-O, or the patent law community.  However, even at that time I did not consciously recognize the potential link to Judge Reyna.  It was only later that I recognized with some horror how it would be interpreted.

Perhaps no offense was taken. Either way though, I do apologize.

– Dennis Crouch

 

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Patents and Antitrust: Trump DOJ Sees Little Connection https://patentlyo.com/patent/2018/02/patents-antitrust-connection.html https://patentlyo.com/patent/2018/02/patents-antitrust-connection.html#comments Sun, 18 Feb 2018 16:18:08 +0000 https://patentlyo.com/?p=22440 Image result for Makan Antitrust Great AgainFor the first time ever, the head of the Antitrust Division for the Department of Justice is a patent attorney – Makan Delrahim – who is known to be “Makan Antitrust Great Again

In a recent speech, Delrahim explained his general position – that patent holders rarely create antitrust concerns.  Rather, it is equally likely that the problem lies with companies implementing new technologies without first obtaining a license from the relevant patent holders.  He explained that the DOJ’s historic approach has been a “one-sided focus on the hold-up issue” in ways that create a “serious threat to the innovative process.”

In response to Delrahim’s approach, a group of technology implementer companies (also known as downstream innovators) and law professors wrote to Delrahim arguing that “patent hold-up is real, well documented, and harming US industry and consumers” — especially in the area of Standards Essential Patents (SEP) — and in ways that the antitrust laws should help fix.

Sweeping in now to buffer Delrahim’s position are a group of libertarian scholars and others (including David Kappos and Judge Michel) who have offered their competing letter.  Their position is largely that the drastic remedies associated with antitrust laws should only be used based upon strong evidence of problems being caused in the market.  Here, they argue that no evidence has shown that violations of FRAND commitments actually cause market harm.

Prof. Jorge Contreras has written on these issues in several Patently-O posts. Contreras did not sign either letter.

Guest Post by Prof. Jorge Contreras: TCL v. Ericsson: The First Major U.S. Top-Down FRAND Royalty Decision

Unwired Planet v. Huawei: An English Perspective on FRAND Royalties

Guest Post on Using the Antitrust Laws to Police Patent Privateering

Good Things Come in Threes? DOJ, FTC and EC Officials Wax Eloquent About FRAND

 

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PTAB Appeals, Standing, and the PTO’s Voice as Intervenor https://patentlyo.com/patent/2018/02/appeals-standing-intervenor.html https://patentlyo.com/patent/2018/02/appeals-standing-intervenor.html#comments Fri, 16 Feb 2018 15:18:02 +0000 https://patentlyo.com/?p=22461 Guest Post by Matthew J. Dowd and Jonathan Stroud

Professor Saurabh Vishnubhakat’s recent well-reasoned post and longer article add much to the discussion about standing to appeal from the PTAB. Standing has recently garnered significant interest from the Federal Circuit. Building on existing scholarship, we have written a concise synopsis of standing law as applied to PTAB appeals, forthcoming in Catholic University of America Law Review.

Drawing from it, we offer a counterpoint to Professor Vishnubhakat’s view, as expressed in his post, of intervenor standing—with his permission (and we thank Prof. Crouch for the opportunity). Professor Vishnubhakat’s thesis asserts, in part, that while 35 U.S.C. § 143 grants the PTO “the right to intervene in an appeal,” separate and independent constitutional standing requirements should prevent it from doing so when an appellee fails to appear. He finds that the PTO’s “ability to intervene often will rest on its ability to show Article III standing” and that the PTO “as intervenor may be able avoid having to show its own standing—but only if (1) the agency has entered the case on the side of a party that does establish standing, and so long as (2) the agency does not seek relief that is different from what that friendly party seeks.” The PTO, he concludes, should not be able to intervene where a party does not appear.

In our view, as a matter of standing alone, the PTO can participate as an intervenor in virtually all AIA appeals from the PTAB—and many reasons are consonant with the principles on which Professor Vishnubhakat bases his reasoning. We make no judgment here on the merits of the positions the PTO solicitor has or will adopt, or the frequency of intervention. While there is a valid debate about the policy choices and the frequency with which the PTO has intervened, that debate is distinct from the legal question of whether the PTO has, or must have, standing as an intervenor beyond their express statutory grant. Professor Vishnubhakat reasons correctly; he just goes a bridge too far.

First, while no court has definitively held that each party to an appeal must establish independent Article III standing where appellants have standing, most courts and opinions suggest that if the party invoking the court’s jurisdiction establishes Article III standing, the inquiry is resolved. For instance, in Camreta v. Greene, 131 S. Ct. 2020 (2011), the Supreme Court found that any opposing party necessarily has an “ongoing interest in the dispute,” so that the case by nature features “that concrete adverseness which sharpens the presentation of issues.”

In ASCARCO Inc. v Kadish, 490 U.S. 605 (1989), the Supreme Court held that while the state-court plaintiffs-respondents lacked Federal Article III standing, the Court had jurisdiction, because the petitioners seeking review had suffered “a specific injury stemming from the [adverse] state-court decree.” Importantly, the Court took no issue with the respondents’ participation in the appeal; they found simply that “the parties remain adverse,” as the plaintiffs-respondents were defending the state court’s judgment, and an appeal would resolve a “genuine case or controversy.”

And the following year in Department of Labor v. Triplett, 494 U.S. 715 (1990),
the Department of Labor and the Committee on Legal Ethics appealed the claims of a third-party attorney below. The majority held that both appealing parties had standing. The government’s “Committee on Legal Ethics” had “the classic interest of a government prosecuting agency arguing the validity of a law upon which its prosecution is based.” There was “no question” the third-party defendant-respondent Triplett had standing, the court reasoned, given his claim that his clients were being deprived of due process. Justice Marshall, concurring, explained that where “respondent has not invoked the authority of any federal court, then, federal standing principles are simply inapplicable to him.” He went on: “Under this Court’s clear pronouncement in ASARCO, the only relevant question for us here is whether one of the petitioners has standing to seek review by this Court of the state court’s judgment.”

Those are a few in an extensive line of cases supporting the view that the party having to show standing is the one seeking to invoke the court’s jurisdiction. For instance, in Rumsfeld v. FAIR, Inc., 547 U.S. 47 (2006), the Supreme Court held that “the presence of one party with standing is sufficient to satisfy Article III’s case-or-controversy requirement.” At a minimum, any fulsome analysis of intervenor standing must consider this precedent.

Second, Town of Chester v. Laroe Estates, Inc., 137 S. Ct. 1645 (2017)—the Court’s most recent opinion on intervenor standing—comports with prior precedent and runs against the need for intervenors to establish standing independent from the parties to the matter, or to establish the standing of an underlying party whose position they support. In Town of Chester, the Court squarely held that “an intervenor must meet the requirements of Article III if the intervenor wishes to pursue relief not requested by a plaintiff.” The Court cited cases specifying that it is the “plaintiff” who needs to show standing, maintaining consistency with the cases discussed above. To read in a requirement that intervenors must establish standing for their positions—or for the parties they side with—even where they pursue the same relief requested by a party would impermissibly broaden the holding.

The Court further explained that, in multi-plaintiff cases, “[a]t least one plaintiff must have standing to seek each form of relief requested in the complaint.” That statement implicitly accepts that not every party needs to prove Article III standing if multiple parties are seeking the same relief and one party has standing. And it does not follow that at least one defendant must have standing to participate on appeal. The Court has deliberately distinguished between a plaintiff’s standing requirement versus a defendant’s.

Arizonans for Official English v. Arizona, 520 U.S. 43 (1997), is not to the contrary, as the good professor suggests. There, the Court held that standing “must be met by persons seeking appellate review, just as it must be met by persons appearing in courts of first instance.” The person seeking appellate review—and thus invoking the court’s jurisdiction—is the appellant, similar to the plaintiff below.

A third consideration—one noted in Professor Vishnubhakat’s post—further supports the PTO’s role as intervenor, and supports the bulk of, but not all of, his conclusions. He is right that, in cases where the PTO will be asking for relief different from one party with standing, the PTO may then have to demonstrate standing, consistent with Town of Chester. This would be true regardless of—and separate from—whether the underlying party has standing.

This matters little given the Chenery doctrine, which bars courts from accepting an agency’s post hoc rationalization as support for the agency’s decision. Chenery essentially precludes the PTO from asking the Federal Circuit for relief that is any broader than what the PTAB held or what the appellee might argue on appeal. In PTAB appeals, rarely will the PTO be seeking a different scope of relief than what the PTAB did or what an appellee will be seeking—usually affirmance. And if the intervening PTO does expand its argument beyond the scope of the original decision, then its argument is simply barred from doing so by Chenery, and the court need not concern itself with a standing analysis.

Fourth, as a practical matter, even if the PTO had to demonstrate standing, the PTO has a statutory right to participate in the appeal as an amicus. The PTO could advance the same arguments as amicus as if it were intervenor, rendering this debate somewhat academic. And the Federal Circuit, if it were so inclined, could grant the PTO leave to file a brief longer than the standard amicus brief, or any additional briefing it might seek. This point does not affect the Article III standing analysis directly, but it speaks to any practical effect of denying the PTO its statutory right to participate as intervenor. If the Federal Circuit is confronted with the choice of having only one side argued, as opposed to having both sides argued, we would suggest most judges, as a practical matter, would prefer to have the competing arguments for consideration, instead of a docket of one-sided, limited, or partially argued cases. The standing issue aside, the patent system and the public good are best served by arguments fully vetted by the adversarial process.

As a final point, we acknowledge the distinct policy concerns created by frequent intervention on one side of the “v.” Getting beyond the standing issue—which we don’t see as much of a hurdle for PTO participation in PTAB appeals—more significant questions arise about if, when, and how often the PTO intervenes. Indeed, George Washington University Law School Professor Dmitry Karshtedt has persuasively called for further exploration of whether the PTO solicitor must or should defend the Board’s decision. Dmitry Karshtedt, Acceptance Instead of Denial: Pro-Applicant Positions at the PTO, 23 B.U. J. Sci. & Tech. L. 319 (2017). This issue is the third question raised sua sponte in Knowles Electronics LLC v. Matal, currently pending at the Federal Circuit. Professor Karshtedt concludes that the PTO solicitor may disagree with the Board where it is plainly inconsistent with the public good. Although we take no position here, we recommend his paper and agree that it’s a debate well-worth having.

We leave these debates for another day, simply noting that a rough internal count reveals: As of September 2016, out of 179 cases decided, the PTO had intervened 98 times (~54% of decided cases); by September 2017, that percentage had fallen dramatically, to 144 out of the 408 then-decided (~35%). Overall, the PTO has said it has intervened in fewer than 25% of all appeals, and that number continues to fall. There may be several reasons for the decline, such as fewer fundamental legal issues as the AIA matures, or a change in PTO policy after thinking its frequent intervention may have irked some judges. Regardless of the precise reasons for the decline and the other policy concerns raised in Knowles, the question of the PTO’s standing to intervene is a distinct legal question. And we think precedent strongly supports the PTO’s ability to intervene in most, if not all, appeals from the PTAB.

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Stambler v. Mastercard: Petition to SCOTUS https://patentlyo.com/patent/2018/02/stambler-mastercard-petition.html https://patentlyo.com/patent/2018/02/stambler-mastercard-petition.html#comments Fri, 16 Feb 2018 12:58:26 +0000 https://patentlyo.com/?p=22458

Two questions presented on Leon Stambler’s petition for writ of certiorari:

1. Whether covered business method review, an adversarial process used by the Patent and Trademark Office to analyze the validity of existing patents, violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.

2. Whether the Federal Circuit’s issuance of Rule 36 judgments without opinions for the disposition of appeals from the Patent and Trademark Office violates 35 U.S.C. § 144’s requirement that the Federal Circuit “shall issue” its “mandate and opinion” for such appeals.

The petition explains:

The first question is substantially similar to that presented in Oil States Energy Servs., LLC v. Greene’s Energy Grp., LLC, No. 16-712 (June 12, 2017), which has been argued and is awaiting decision by the Court. The second question is identical to that presented by the Petition for writ of certiorari in Celgard, LLC v. Matal (No. 16-1526) (question #2, petition pending).

The case relates to Stambler’s U.S. Patent No. 5,793,302 (authentication system and method). The patent has been asserted in dozens of cases and upheld in several court decisions prior to the PTAB finding it invalid.

[Petition]

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Eligibility Analysis and its Underlying Facts: A Roadmap for Surviving Dismissal on the Pleadings https://patentlyo.com/patent/2018/02/eligibility-underlying-surviving.html https://patentlyo.com/patent/2018/02/eligibility-underlying-surviving.html#comments Thu, 15 Feb 2018 15:01:38 +0000 https://patentlyo.com/?p=22450 by Dennis Crouch

Aatrix Software, Inc. v. Green Shades Software, Inc., 2017-1452, 2018 WL 843288 (Fed. Cir. Feb. 14, 2018)

Following upon its February 8 decision in Berkheimer, the Federal Circuit has again sided with the Patentee on eligibility grounds – holding here that the lower court’s judgment on the pleadings failed to consider disputed issues of material fact.  Prior to this pair of cases, it was unclear whether eligibility analysis involved factual questions.  Although pair of cases indicate a precedential sea-change, both opinions were written by Judge Moore and joined by Judge Taranto (Berkheimer was also joined by Judge Stoll).  Here, Judge Reyna dissented, writing:

I respectfully disagree with the majority’s broad statements on the role of factual evidence in a § 101 inquiry. Our precedent is clear that the § 101 inquiry is a legal question. In a manner contrary to that standard, the majority opinion attempts to shoehorn a significant factual component into the Alice § 101 analysis.

Reyna in dissent.

The divide among the court is now quite clear — what is needed is an en banc consideration of the issues.  Failing that, we will continue to muddle and err.

Going back to the majority opinion, the court explained the setup:

  • Plaintiff filed complaint alleging patent infringement;
  • Defendant motioned for dismissal on the pleadings — asking the court to declare the asserted patent ineligible as a matter of law;
  • Plaintiff filed a motion to amend its complaint to add specific allegations of fact directed to step-two of the Alice/Mayo inquiry — attempting to setup a material factual dispute that could not be resolved on the pleadings;
  • District Court found the patent claims ineligible; refused to allow the amended complaint; according to the court the amendment would not have made any difference – would not have manufactured a factual dispute – since eligibility is a pure question of law.
  • On appeal here, the Federal Circuit has vacated the judgment — holding that the complaint raises factual disputes that must be resolved prior to ruling on the eligibility issue.

The majority writes here:

[The Federal Circuit has previously] held that patent eligibility can be determined at the Rule 12(b)(6) stage. This is true only when there are no factual allegations that, taken as true, prevent resolving the eligibility question as a matter of law.

. . .

The district court granted this Rule 12(b)(6) motion without claim construction. We have some doubt about the propriety of doing so
in this case, but need not reach that issue because it did err when it denied leave to amend without claim construction and in the face of factual allegations, spelled out in the proposed second amended complaint, that, if accepted as true, establish that the claimed combination contains inventive components and improves the workings of the computer.

Moore majority opinion.

Following the majority opinion, some plaintiffs will now look to the patentee’s proposed proposed amended complaint as one roadmap establishing a factual dispute sufficient for a patentee to overcome a motion on the pleadings.  In particular, the complaint alleges a novel data importation scheme that is database independent and that “eliminat[es] the need for hand typing in the values.”  Further, the complaint alleges that the result is “increased the efficiencies of computers processing tax forms” and “saved storage space” on the computers.

Although not proven, Judge Moore suggests that – if proven – these allegations would leave the asserted claims patent eligible since they are “directed to an improvement in the computer technology itself and not directed to generic components performing conventional activities.”  Judge Moore then goes on to explain that these allegations are factual allegations rather than conclusory legal allegations and must be given due process according to the rules of our legal system.  The majority opinion also claims the following:

Whether the claim elements or the claimed combination are well-understood, routine, conventional is a question of fact. And in this case, that question cannot be answered adversely to the patentee based on the sources properly considered on a motion to dismiss, such as the complaint, the patent, and materials subject to judicial notice.

This quote sets-up the potential en banc case: To what extent does eligibility involved factual disputes; to what extent should extrinsic evidence be available to prove those facts?  For patent litigators, these questions look strikingly similar to the decades old dispute over the proper approach to patent claim construction.  It is easy to see eligibility following in the same line of reasoning seen in Teva and Phillips that allows for full judicial but opens the door to potential (but often not required) factual findings regarding extrinsic evidence.

Last note here — The claims at issue are claims 1, 2, and 22 of U.S. Patent No. 7,171,615 (“’615 patent”) and claims 1, 13, and 17 of U.S. Patent No.
8,984,393.  These patents cover really simple tax prep forms that I expect the Supreme Court would eat for lunch.

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USPTO Director Andrei Iancu https://patentlyo.com/patent/2018/02/uspto-director-andrei.html https://patentlyo.com/patent/2018/02/uspto-director-andrei.html#comments Wed, 14 Feb 2018 17:13:43 +0000 https://patentlyo.com/?p=22445 On February 13, 2018, the USPTO issued 6,825 patents, including 6,152 utility patents — Each signed by the new USPTO Director Andrei Iancu (albeit via automated electronic process).

 

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Valentines Day: USPTO Style https://patentlyo.com/patent/2018/02/valentines-uspto-style.html https://patentlyo.com/patent/2018/02/valentines-uspto-style.html#comments Wed, 14 Feb 2018 12:11:56 +0000 https://patentlyo.com/?p=22443

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Trump’s Budget Proposal for USPTO Flat for FY 2019 https://patentlyo.com/patent/2018/02/trumps-budget-proposal.html https://patentlyo.com/patent/2018/02/trumps-budget-proposal.html#comments Tue, 13 Feb 2018 16:51:45 +0000 https://patentlyo.com/?p=22437 The Trump proposed budget for FY2019 appears to be essentially flat as compared with FY2018.  The proposed budget would permit the USPTO to spend up to $3.459 billion in FY 2019 (year beginning October 1, 2018). We are approaching the 1/2 way mark for FY 2018.  In the most recent PPAC meeting, PTO Chief Financial Officer Tony Scardino reported expected FY2018 spending of $3.444 billion.

Trump Budget (PTO on p. 199): http://src.bna.com/wlO

 

 

 

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