Government Contracts and Ownership of Technical Data

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.


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.

Pre-AIA 102: Meaning of On Sale “in This Country”

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.

= = = =

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.]

= = = =

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].

Doctrine of Equivalents in Lilly v. Apotex

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.

Patently-O Bits and Bytes by Juvan Bonni

Recent Headlines in the IP World:

Commentary and Journal Articles:

New Job Postings on Patently-O:

What is an Article of Manufacture for Design Patent Law?

USPTO is seeking public comment on the meaning of an “article of manufacture” as used in 35 U.S.C. 171(a):

Whoever invents any new, original and ornamental design for an article of manufacture may obtain a patent therefor, subject to the conditions and requirements of this title.

The Federal Circuit’s recent decision in Curver Luxembourg refocused attention on the importance of the particular article of manufacture in the design patenting process. That case reiterated the point that design patents must be tied directly to an article of manufacture, and not simply a design in the abstract.

[L]ong-standing precedent, unchallenged regulation, and agency practice all consistently support the view that design patents are granted only for a design applied to an article of manufacture, and not a design per se.

Curver Luxembourg, SARL v. Home Expressions Inc., 938 F.3d 1334 (Fed. Cir. 2019) (refusing to enforce Curver’s patent as a disembodied design).

[RFC Design Patents]

This particular RFC focuses on emerging technologies: projections; holographs; virtual/augmented reality; etc.  I would also include screen icons that are only temporarily shown when electricity is applied.  In general, the USPTO has deduced the following regarding screen icons from various precedential decisions:

  • they must be embodied in a computer screen, monitor, other display panel, or portion thereof;
  • they must be more than a mere picture on a screen; and
  • they must be integral to the operation of the computer displaying the design.

Particular questions from the RFC:

  1. Please identify the types of designs associated with new and emerging technologies that are not currently eligible for design patent protection but that you believe should be eligible. For these types of designs, please explain why these designs should be eligible, how these designs satisfy the requirements of section 171, and how these designs differ from a mere picture or abstract design. In addition, if you believe that these types of designs should be eligible, but a statutory change is necessary, please explain the basis for that view.
  2. If the projection, holographic imagery, or virtual/augmented reality is not displayed on a computer screen, monitor, or other display panel but is integral to the operation of a device (e.g., a virtual keyboard that provides input to a computer), is this sufficient to render the design eligible under section 171 in view of the current jurisprudence? If so,
    please explain how the article of manufacture requirement is satisfied and how these designs differ from a mere picture or abstract design. If you believe that these designs do not meet the requirements of section 171, please explain the basis for that view.
  3. If the projection, holographic imagery, or virtual/augmented reality is not displayed on a computer screen, monitor, or other display panel but is interactive with a user or device (e.g., a hologram moves according to a person’s movement), is this sufficient to render a design eligible under section 171 in view of the current jurisprudence? If so, please explain how the article of manufacture requirement is satisfied and how these designs differ from a mere picture or abstract design. If you believe that these designs do not meet the requirements of section 171, please explain the basis for that view.
  4. If the projection, holographic imagery, or image appearing through virtual/augmented reality is not displayed on a computer screen, monitor, or other display panel but is projected onto a surface or into a medium (including air) and is not otherwise integral to the operation of a device or interactive with a user or device (e.g., is a static image), is
    this sufficient to render a design eligible under section 171 in view of the current  jurisprudence? If so, please explain how the article of manufacture requirement is satisfied and how these designs differ from a mere picture or abstract design. If you believe that these designs do not meet the requirements of section 171, please explain the
    basis for that view.
  5. Do you support a change in interpretation of the article of manufacture requirement in 35 U.S.C. 171? If so, please explain the changes you propose and your reasons for those proposed changes. If not, please explain why you do not support a change in interpretation.
  6. Please provide any additional comments you may have in relation to section 171, interpretation or application of section 171, or industrial design rights in digital and new and emerging technologies.

Deadline for comments: Feb 4, 2021

Method: Comment via the portal at (Docket No PTO-C-2020-0068).

NCAA v. Alston: Antitrust and Athlete Pay

Best sports of the season may actually be in the court — the Supreme Court.  The Supreme Court has agreed to hear the antitrust against the NCAA and AAC regarding payments to student athletes.

The basic issue here is that big-sport colleges and their associations (NCAA, SEC, ACC, etc.) generate tremendous revenue while at the same time use horizontal agreements to force their athletes to remain amateur.

Question presented:

By NCAA: Whether the Ninth Circuit erroneously held … that the National Collegiate Athletic Association eligibility rules regarding compensation of student-athletes violate federal antitrust law.

Restatement by Athletes: Whether restraints that competing NCAA member schools have agreed to impose in the name of “amateurism” should be exempt from challenge under the antitrust laws.

And, who owns the IP?

See National Collegiate Athletic Ass’n v. Board of Regents of the University of Oklahoma, 468 U.S. 85 (1984)

Finjan’s Claims in IPR

Palo Alto Networks, Inc. v. Finjan, Inc. (Fed. Cir. 2020)

Note – I originally misread this decision as applying the Phillips standard for claim construction. On review, I realize that I misread the decision. The court explains:

For petitions for inter partes review filed on or after November 13, 2018, the Board applies the Phillips district court claim construction standard. 37 C.F.R. § 42.100(b) (2018); Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc); Immunex Corp. v. Sanofi-Aventis U.S. LLC, 977 F.3d 1212, 1216 & n.2 (Fed. Cir. 2020). For petitions for inter partes review filed before November 13, 2018, like Palo Alto’s, we apply the broadest reasonable interpretation claim construction standard.

So, my original opinion–that the change in claim construction made the difference–is obviously wrong.

= = = =

This appeal stems from an IPR proceedings filed by Palo Alto (PANW) against Finjan’s US. Patent No. 8,141,154.  Back in 2017, the Board originally sided with Finjan and confirmed patentability of the claims (not proven unpatentable). In a 2018 appeal, however, the Federal Circuit vacated that decision under SAS.  The IPR had only been partially-instituted and the Supreme Court in SAS held that partial-institution is improper.   On remand, the Board expanded its institution to all challenged claims and then again sided with the patentee — finding none of the challenged claims were proven unpatentable.  On appeal here, the Federal Circuit has affirmed. (more…)

The USPTO Patent Litigation Dataset: Open Source, Extensive Docket and Patent Number Data

Guest Post by Prof. Ted Sichelman, University of San Diego School of Law

Many online services provide district court patent litigation dockets, documents, and associated patent numbers. However, none of these services offer comprehensive, hand-coded patent numbers and case types, plus full dockets and key documents (complaints, summary judgments, verdicts), downloadable in bulk at no charge and with no license restrictions.

After more than three years of extensive automated and manual review of patent dockets, the USPTO’s Office of the Chief Economist —in conjunction with researchers from the University of San Diego’s Center for IP Law & Markets (myself) and Northwestern Law School (David L. Schwartz)—have completed that very goal, expanding upon the patent litigation dataset the USPTO had released in 2015.

Currently, the dataset (available here) includes:

  • Dockets: The complete docket for every lawsuit filed in district courts tagged as a patent action in PACER (and many other patent cases tagged under non-patent PACER codes) from the first patent case logged in PACER through the end of 2016 (over 80,000 case dockets).
  • Attorneys & Parties: Full lists of parties by type (e.g., plaintiff, defendant, intervener, etc.) and their attorneys, with full contact information for the attorneys gathered from public records.
  • Patent Numbers: Comprehensive, hand-coded patent numbers by a team over 30 law students from all electronically available complaints in PACER in cases filed from 2003 through the end of 2016.
    • Based on testing against several of the leading commercial services, plus publicly available data from the Stanford NPE Litigation Database, the dataset’s patent number information is substantially more complete and accurate than any of these services (which often use automated methods for determining patents-in-suit).
  • Case Types: Every case in PACER filed from 2003 through the end of 2016 is identified with one of 15 fine-grained case types, including patent infringement (non-declaratory judgement [DJ]), DJ on non-infringement and invalidity, DJ on non-infringement only, DJ on invalidity only, false marking, inventorship, malpractice, regulatory challenge, and others.

In the next few months, the USPTO will make available:

  • Documents: Initial complaints, summary judgment orders, and verdicts (bench and jury) that are electronically available for all patent cases in PACER filed from 2003 through the end of 2016.

The data is downloadable only in bulk and is not searchable at the USPTO website. However, it is relatively straightforward to download and search the patent number, case type, and attorney data, in Microsoft Excel or other database and statistical packages.

Importantly, there are no licensing restrictions whatsoever on the use of the data, and the research team and USPTO expect that commercial and non-commercial services will add the information to their search interfaces in the coming year. Additionally, the research team is hoping to update all of the data for patent cases filed through the end of 2020 sometime next year. Further down the road, we hope to code cases for outcomes and add appeals by supplementing Jason Rantanen’s comprehensive Compendium of Federal Circuit Decisions with full dockets and key documents.

In examining litigation trends, many researchers across the academic, public, and private sectors have used proprietary datasets, which generally could not be disclosed to other researchers for study replication and testing. Hopefully, academics and others will now use the USPTO’s fully open dataset for studies on the U.S. patent litigation system to allow for meaningful review of empirical studies.

Documentation on the database is available here and at the USPTO webpage. Anyone interested in using the data is also welcome to contact me ( with technical and other questions.

Some pending en banc petitions before the Federal Circuit

In re Apple (level deference given on mandamus review of discretionary transfer decisions). [Uniloc Brief][Crouch’s prior post]

Valeant Pharmaceuticals North America LLC v. Mylan Pharmaceuticals, Inc. (Proper venue for ANDA filing — what counts as having “has committed acts of infringement”). [ValeantANDAVenue][Crouch’s prior post]

C R Bard Inc. v. AngioDynamics, Inc. (printed matter and eligibility). [BardPrintedMatter][Crouch’s prior post]

EcoServices, LLC v. Certified Aviation Services, LLC  (automation & eligibility) [EcoWashingMachine][CAFC Decision]

GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc. (inducement and “skinny labels”) [GlaxoInducingSkinny][Crouch’s Prior Post]



Injury-in-Fact and Standing to Appeal from the AIA-Trial Decisions

New petition for writ of certiorari in an interesting Hatch-Waxman and the question of Article III standing in appeals of AIA-Trial Decisions.

Argentum Pharmaceuticals LLC v. Novartis Pharmaceuticals Corporation (Supreme Court 2020)

Introducing generic alternatives that compete with previously approved drugs requires market approval through the Food and Drug Administration (“FDA”). To do so, competitors submit an Abbreviated New Drug Application (“ANDA”) that relies on the safety and efficacy data of the previously approved brand name drug. When that previously approved drug is covered by a patent, however, the mere act of filing the required ANDA subjects the competitor to an immediate patent infringement suit by the brand name company. Such suits are common. By filing an infringement action, the brand name company obtains an automatic 30-month stay during which the FDA cannot approve the competitor’s ANDA.

The real and immediate risk of an infringement suit extends equally to all members of joint ventures that work towards FDA market approval. Petitioners formed a joint venture with a manufacturing partner to develop a generic alternative to Respondent’s brand name drug. Fearing an infringement suit, Petitioner challenged the validity of Respondent’s patent through an administrative proceeding created by Congress under the Leahy-Smith America Invents Act. Petitioner did not prevail on the challenge and appealed the adverse decision.

The questions presented are:

i. Did the Federal Circuit categorically and erroneously preclude redress for injured members of joint ventures in the pharmaceutical industry by only recognizing (1) the manufactuing partner in the joint venture, and (2) the partner applying for FDA marketing approval in the joint venture, as having demonstrable injury-in-fact for Article III standing?

ii. Did the Federal Circuit err by rejecting the Leahy-Smith American Invents Act’s statutory estoppel provisions as a basis to demonstrate injury-in-fact for Article III standing?

Petition.  The petition here was filed by Terry Stanek Rea, former PTO Deputy Director (and Acting Director).

Adaptive Streaming – Not Patent Eligible

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.

= = = = =

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%).


Patently-O Bits and Bytes by Juvan Bonni

Recent Headlines in the IP World:

Commentary and Journal Articles:

New Job Postings on Patently-O:

2020 Patent Exam – Are you Smarter than a 2L?

At the University of Missouri, my patent law class is practice based – with students drafting claims, rejecting claims, responding to office actions, and participating in a patent law moot court competition. The class is pretty much fully packed. Still, I also give them a short final exam to ensure sure that they have learned the basics.  This year’s exam is based upon an actual pending patent application for the Boss Hammer.  Note – I played with the actual facts and claims a bit to make it all more straightforward.

= = = =

Introduction: Daniel Raymond is the inventor of the “Boss Hammer” shown below. The hammer works as a conventional claw-hammer that might be used by a carpenter or house framer, but also has several secondary functions.  You can see the ruler being used in the drawings below.  The head of the hammer is slightly wider than the handle that allows it to rest atop a board (FIG 4A) and is arranged so that the handle extends out at a right-angle when the head is resting on the board. The head of the hammer is standard width (here 1-inch) so that it can form part of the measurement (FIG 4B).  The hammer also includes a set of angle marks calibrated with the claw end (FIG 5). This replaces a carpenter square so that you wouldn’t need to carry so many tools.

Raymond’s patent application claims a March 2019 effective filing date and includes the description and drawings above.  The application is currently pending before the USPTO with the following claims:

1. A hammer, comprising: a head; and a handle extending from said head;

wherein said head includes (a) a nail-striking section having a base surface and (b) a nail-pulling section having a pair of claws, each claw having an end;

wherein the claw ends share a common plane with the base surface of the nail-striking section; and wherein no other portions of the claws share a common plane with the base surface of the nail-striking section;

wherein at least a portion of said handle extends linearly and perpendicularly to said common plane for allowing a user to draw a straight line which is perpendicular to the common plane.

2. The hammer as set forth in claim 1 wherein said handle further includes angle indicia which indicates angles relative to said ends of said claws for allowing a user to draw a straight line which is non-perpendicular to the common plane.

[Note: I did not provide the students with this, but you can read Raymond’s published patent application here: Raymond Published App (Patent Center link). Likewise with the prior art: Warren Patent Prior Art].

Prior to filing the patent application, Raymond formed a new company (Boss Hammer Co.) and assigned his rights to the patent application to the new company.

One key prior art reference has been identified by the USPTO Examiner: U.S. Patent No. 7,621,503 (“Warren”).  That patent has now expired, but the Patent Examiner identified it as prior art because Warren’s patent application was filed in 2005 and the patent issued in 2009.

Raymond sees a few differences between his claims and Warren.  In particular: (1) in Warren, the entire base of the head is flat while Raymond’s head includes the curved claws; and (2) the angle-lines in Warren are relative to the nail-striking portion while Raymond proposes that these be drawn relative to the claw.  Raymond argues that these differences allow for a more agile hammer head.

= = = = =

Question 1. Is Raymond’s claim 2 directed toward eligible subject matter?

Question 2. Provide a concise argument why the USPTO should reject claim 1 as indefinite.

Question 3. Raymond is concerned that his pre-filing assignment of rights (discussed above) might block him from receiving a patent. In particular, the transfer document is labelled a “sale of patent rights” and recite $1 as consideration. Will the assignment of rights cause his company problems under Section 102?

Question 4. Should Warren bar Raymond from obtaining a patent?

Question 5. Higher-end hammer-heads are often made of titanium and it is well known in the industry how to form hammer-heads out of the metal. In his patent application, Raymond only disclosed Steel as a material for the hammer head. Raymond has suggested to his attorney that he would like to add a claim limitation directed to a titanium head. Raymond correctly notes that, after reading his application, someone skilled in the art would be able to make-and-use a titanium version of his invention. Can he amend the claims to add the titanium-head element? (Consider only written description and enablement requirements).

Question 6. It is now 2022: Raymond obtained a patent covering claim 1 in 2021.  Later that year, IKEA began selling a similar hammer for its customers to use when assembling furniture.[1] The key difference between what Raymond sells and IKEA’s is that IKEA’s hammer-head is rubber-coated metal.  In addition, IKEA sells the hammer unassembled with instructions for assembly.  (It comes in two separate pieces –head and handle).  Will Raymond be able to show that IKEA infringes?


[1] IKEA sells its furniture unassembled, and it is a notoriously laborious process to assemble some items.

= = = = =

The hammer here looks pretty cool and would be a great holiday gift for your patent attorney friends. Wrap it in the drawings from the patent application.

Summary Judgment Satisfies Justice

by Dennis Crouch

Super-Sparkly Safety Stuff v. Skyline (Fed. Cir. 2020)

Apart from the Plaintiff’s fabulous name, this case involves the defendant’s catch-phrase “bling-it-on!”; photos of celebrity models; personal weapons (pepper spray); AND a design patent!

Both of these companies take the approach that a can of pepper-spray should be a fashion-accessory.  Skyline’s catch-phrase is “Bling it On!” while Super-Sparkly Safety Stuff doesn’t need more than its company name. The Patent at issue here is Super-Sparkly’s Design Patent No. D731,172 titled “rhinestone covered container for pepper spray canister.”  In the images below, you can compare the patented design (left) with Skyline’s accused product (right).  I have also included an image of a prior art rhinestone cover that was given-out at the Oscars a few years ago.

One thing to note here is that the patented design requires rhinestones on the bottom of the cannister.  Neither the accused product nor the prior art include those bottom-rhinestones.  Based upon that distinction, the district court awarded partial summary judgment of non-infringement. On appeal, the Federal Circuit has affirmed:

The district court did not err in concluding that that this difference precludes a finding of infringement under the ordinary observer test. . . .

The ’172 patent claims a very simple design, in which rhinestones are applied to two surfaces of a canister: the vertical cylinder and the bottom. Removing the rhinestones from one of these surfaces—the bottom—is a significant departure from the claimed design. The ’172 patent and the accused design are thus plainly dissimilar. . . . Even assuming that the two designs are not “plainly dissimilar,” a comparison with the prior art makes clear that the accused design does not infringe the ’172 patent. Although there do not appear to be “many examples of similar prior art designs,” the prior art “Pepperface” reference, dating from 2006, was widely marketed and endorsed by various celebrities. Its design has rhinestones around the majority of the canister, but not on the top (near the spray nozzle) or bottom of the cylinder. Per Egyptian Goddess, then, the Pepperface design highlights that the key difference between the ’172 patent and the accused design is that the bottom of the cylinder is decorated with rhinestones.

Summary Judgment of Non-Infringement Affirmed.

Civil Procedure moment: Here, the non-infringement was only partial summary judgment because other claims remained pending in the case–namely, Skyline filed unfair competition counterclaims. Under R. 54(b), partial summary judgment is not immediately appealable because it is not a “final judgment.”  However, the rule allows the district court to sever-off that portion of the case and enter final judgment “if the court expressly determines that there is no just reason to delay.”  This is effectively an alternate mechanism for certifying an interlocutory question for appeal.  The district court took those steps here, and the Federal Circuit agreed that “the case was properly certified” and so heard the appeal.

Before the district court, the plaintiff had asked the court to delay the summary judgment ruling and instead permit more discovery under R. 56(d).  The district court denied that request and the Federal Circuit found no abuse of discretion.  In particular, the appellate panel found that none of the additional discovery sought by the patentee “has any bearing on the ordinary observer test for design patent infringement.”

Who Says its Not Convenient? Mandamus on 1404(a) Convenience

by Dennis Crouch

In re Apple (Apple v. Uniloc), Misc. Docket No. 20-135 (Fed. Cir. 2020)

In November 2020, the Federal Circuit granted Apple’s mandamus petition and ordered the case of Uniloc v. Apple to be transferred from W.D.Tex. (Albright, J) to Apple’s other home-court of N.D. Cal.  In the Federal Circuit’s opinion, the district court had clearly abused its discretion in finding that N.D. Cal. was not clearly the more convenient forum.  Notice the double-use of the word clearly above — the district court will transfer only when the proposed forum is “clearly more convenient”; and mandamus will only be granted for “clear abuse of discretion.”

Uniloc has now petitioned the court for en banc rehearing–arguing that the appellate panel failed to provide the double-deference required for mandamus review of a discretionary transfer decisions. As Judge Moore wrote in her dissent, “There is no more deferential standard of review.

I remember talking with soon-to-be Chief Judge Rader back in 2009 about the court’s most important opinions of the term.  My view for top-on-the-list was In re TS Tech USA Corp., No. 09-M888 (Fed. Cir. Dec. 29, 2008).  That was the first case where the court granted mandamus on a denial of venue transfer under 28 U.S.C. § 1404(a). At that time, patent litigation was highly concentrated in the Eastern District of Texas, and the proper venue statute, 28 U.S.C. § 1400(b), had been fully nullified by the Federal Circuit.  E.D. Tex. remained a hot venue in patent cases following TS Tech, even as district court patent litigation declined based upon eligibility dismissals and the rise of administrative trials in the form of inter partes review (IPR). The real venue hammer came down with the Supreme Court’s decision in TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (2017).  In that decision, the court reinvigorated the notion of “proper venue” under § 1400(b).  Now, patent cases can only be sued in districts within where the defendant is incorporated or where where the defendant has infringed the patent and keeps a regular-and-established-place-of-business.  By closing its Plano, TX Apple Store, Apple was able to avoid the E.D. Tex. because venue was no longer proper.

In my view this history is important.  The pre-TC Heartland nullification of the proper-venue statute (§ 1400(b)) was a but-for cause of the E.D. Tex. concentration “problem”; and the Federal Circuit used the convenient-venue statute (§ 1404(a)) to relieve that policy pressure.  Now that proper-venue has been revitalized, it is time for the court to also reconsider its approach to convenient-venue.

In this case, it is clear that W.D. Texas is a proper venue for Apple; It also seems like it is pretty darn convenient. Apple has 8,000+ employees in the district and maintains its second-largest headquarters outside of Cupertino. One of the accused products is made in the district. And, even if Apple needs to fly-in witnesses it will be OK because the company is in the process of building its own 192 room hotel in the district.

= = =

Extraordinary Writ?: I may do a separate essay that focuses more on the legal issues of the petition, but I thought I would leave-of with an interesting statistic from the petition:

Since 2008, [the Federal Circuit] has issued over seventy mandamus decisions; the Fifth Circuit by comparison has issued seven. And this Court grants the “exceptional remedy” of mandamus in approximately 1-out-of-3 petitions.

Petition at 2.


Locking in the Rules at the PTO

President Trump’s administrative agencies are working hard to lock-in policy changes before the major shift expected in January.  The Patent Office is no different. The changes here (except those implementing court precedent) are ones that the next administration could change, but the implementation Final Rules and Precedential Decision create administrative hurdles.

Final Rules on PTAB Practice: A new set of final rules has now been published and will become effective on January 8, 2021. [Rules].

  • Eliminating Presumption in Favor of Petitioner’s Evidence: During the institution stage, there is currently a presumption in favor of the petitioner involving testimonial evidence. 37 C.F.R. § 42.108(c) states that “a genuine issue of material fact created by such testimonial evidence will be viewed in the light most favorable to the petitioner solely for purposes of deciding whether to institute [a] review.’’  The change eliminates that presumption and going forward the Board will simply consider and weigh all presented evidence according to the institution standard.
  • Right to a sur-reply: this rule provides the patentee with the right to get-in the last word in the institution-stage briefing.  The new rules also allows the patent owner to respond to a decision to institute.  These changes have already been adopted by the Board, but are now codified within the Rules.
  • SAS: The new rules also implement the requirements of SAS barring partial institution (either all challenged claims are reviewed, or no claims are reviewed).

[Rule Change]

New Precedential Decisions: The PTAB (operating under the guidance of Dir. Iancu) has designated three recent institution related decisions as Precedential.  These decisions are important for locking-in the Board’s approach because the Federal Circuit no longer has authority (Thryv) to guide the scope and procedure of IPR institutions.

  • RPX Corp. v. Applications in Internet Time, LLC, IPR2015-01750, Paper 128 (Oct. 2, 2020) (precedential) (Finding that Salesforce is a real-party-in-interest of RPX, and thus that RPX is time-barred from petitioning for IPR).
  • SharkNinja Operating LLC v. iRobot Corp., IPR2020-00734, Paper 11 (Oct. 6, 2020) (precedential) (Board only needs to resolve real-party-in-interest disputes that would impact the time-bar).
  • Apple Inc. v. Uniloc 2017 LLC, IPR2020-00854, Paper 9 (Oct. 28, 2020) (precedential) (Denying institution/joinder of Apple’s copycat petition as a serial challenge; applying the General Plastics model.)

[PTO Description and Links to Cases].  It is easier for the next admin to make changes to these precedential decisions than it is to change rulemaking, but would at least be done in a public manner.


Patents and COVID-19 Vaccines

NYTimes has published a new opinion piece titled “Want Vaccines Fast? Suspend Intellectual Property Rights.”

A few years ago I wrote an essay entitled Nil: The Value of Patents in a Major Crisis Such as an Influenza Pandemic (2009).  My basic argument was that the timeline for patenting is quite different than the timeline for a pandemic.  Patents typically take years to obtain (especially on an international level) and pandemics typically have a shorter timeline.  By the time the patents issue, the crisis will likely be averted.  And, if the crisis is still ongoing governments will simply bend/break the patents if their owners refuse to comply.

My understanding is that – so far – none of the COVID-19 vaccines have been patented, but that process is certainly in the works.  The NYTimes article also implicitly recognizes that patents are not the key to COVID distribution, rather, the focus here is really to force the technology developers to also turn-over their undisclosed know-how and trade secrets. This is something obviously more invasive than refusing to enforce patent rights and would shift the balance of power out of the hands of the innovator companies.

Reviewing Summary Judgment for Abuse of Discretion?

GS Cleantech v. Adkins Energy LLC (Supreme Court 2020)

This pending petition for certiorari focuses on the civil procedure question: What is the standard for review of a partial summary judgment that is not reopened at trial?  Normally summary judgment is reviewed de novo on appeal, but this is a case where the Federal Circuit switched the standard.

The patentee here intentionally failed to disclose its its pre-filing sales-activity to the PTO during prosecution. Those prior sales barred patenting of a number of claims (on sale bar) and the remaining were found unenforceable (inequitable conduct).  That outcome was affirmed on appeal by the Federal Circuit and the court denied a petition for rehearing (without opinion).  Now comes the petition for writ of certiorari. Prof. Hricik and I have both written about the Federal Circuit decision:

Here is the relevant procedure at the district court:

  • Summary Judgment of Invalidity: A number of claims found invalid based upon the GS-Cleantech’s pre-filing commercial offer for sale (made after the invention was ready for patenting).
  • Bench Trial for Inequitable Conduct: The remaining claims were found unenforceable due to inequitable conduct at trial.  Inequitable conduct requires a showing of both intent-to-deceive and that the deception was material to patentability.  At trial, the district court relied upon its summary judgment determination as evidence of materiality.

When appealed, inequitable conduct determinations are generally reviewed for abuse of discretion — providing substantial deference to the district court determination.  The patentee argued that things should be different on the issue of materiality – particularly on the issue of whether the undisclosed prior sales rendered the claims invalid.  The difference here, is that issue was decided on summary judgment, and summary judgment is generally reviewed de novo on appeal.

The Federal Circuit gave full deference — noting that the district court “held an eight-day bench trial in which materiality was squarely before it.”  Further, the district court did not simply apply its prior summary judgment determination but rather it incorporated the summary judgment evidence and admitted additional relevant evidence, including previously unheard testimony relating to materiality and ultimately “confirmed” its summary judgment determination in finding materiality.  On appeal, the Federal Circuit found this sufficient to move the on-sale determination fully under the abuse-of-discretion shelter of the inequitable conduct trial and identified the patentees arguments as lacking nuance. (“This argument is jejune.”).

The patentee also directly appealed the summary judgment of invalidity, but the appellate panel did not hear that issue (which it would have given de novo review). Rather, the appellate panel found the issue moot based upon the unenforceability holding.

All that sets up the current petition for writ of certiorari:

Until the Federal Circuit’s decision in this patent case, every Circuit had held that an issue resolved on partial summary judgment, and not reopened at trial, must be reviewed de novo. Here, the district court resolved the issue of patent invalidity on partial summary judgment, and did not reopen it at trial. Yet, the Federal Circuit expressly refused to review the issue de novo, and instead reviewed it under the “abuse of discretion” standard governing review of the decision at trial.

The question presented is: Whether the Federal Circuit, in cases arising under the Patent Act, may depart from the uniform rule of the other Circuit Courts that an issue resolved on partial summary judgment, and not reopened at trial, must be reviewed de novo on appeal.


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