Soto v. US: Will the Court Require Congress to Say the “Magic Words?”

Patent

By Dennis Crouch

Although most of our fare is IP related, I have also been keeping an eye on other Federal Circuit cases.  On April 28, 2025, the Supreme Court hears oral arguments in  one of those, Soto v. US, a case could significantly impact thousands of combat-disabled veterans seeking retroactive benefits. The Court will decide whether veterans can receive full retroactive Combat-Related Special Compensation (CRSC) payments or are instead limited to six years of backpay under the federal Barring Act.

Background: Marine veteran Simon Soto served in Mortuary Affairs during Operation Iraqi Freedom, where he retrieved fallen service members, often under combat conditions. This obviously stressful assignment led to severe PTSD, resulting in his medical retirement in 2006. In December 2008, the Department of Veterans Affairs rated him 100% disabled due to combat-related PTSD, which qualified him for CRSC under a 2008 program expansion that opened benefits to all medically retired veterans with combat-related disabilities.

However, Soto did not apply for these benefits until 2016, approximately eight years after becoming eligible. While the Navy approved his claim, it only provided retroactive payments dating back six years (to December 2010), citing the six year statute of limitations found in the "Barring Act." 31 U.S.C. § 3702.  Soto argues that the CRSC statute itself (10 U.S.C. § 1413a) contains its own settlement mechanism that displaces the Barring Act's time limitation.  The Barring Act provides "authority to settle claims" against the U.S. Government, and particularly identifies a settlement process with the six-year statute of limitations to be used "except as provided [by] another law."  The question then is whether the CRSC statute does, in fact, provide, alternative settlement authority.  The basic problem is that the CRSC statute does not expressly state that it is providing "settlement" authority and it contains no statute of limitations.  On this second point, Soto suggests that the absence of a SOL is a feature

As I wrote last November, the Federal Circuit split 2-1 in reversing the district court's ruling in favor of Soto. Judge Todd Hughes, writing for the majority, applied a formalist approach requiring specific statutory language. Hughes concluded that nothing in the CRSC statute expressly supersedes the Barring Act, looking for "magic words" such as specific authorization to "settle" claims or an alternative limitations period.  Judge Jimmie Reyna dissented, advocating for a more functional analysis that would benefit the disabled veterans. Reyna argued that the majority's test was unnecessarily rigid, pointing out that over a century ago, the Supreme Court defined "settle" in this context to simply mean making an administrative determination of the amount of money due on a claim. In his view, the CRSC process unquestionably meets that definition. This divide between Hughes and Reyna reflects a broader philosophical tension I've observed across multiple cases, with Hughes typically adopting a text-focused formalist approach and Reyna favoring a more purposive or justice-oriented analysis that considers practical impacts.

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Federal Circuit Affirms: Rule 60(b) Motion Filed Too Late to Revive Patent Case

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"You only get one shot, do not miss your chance to blow. This opportunity comes once in a lifetime, yo." Emenim

The Federal Circuit recently affirmed the District of Delaware's denial of Franz Wakefield's motion for relief from judgment under Rule 60(b), underscoring the importance of timely raising arguments during the normal appeal process. Wakefield v. Blackboard Inc., Nos. 2024-2030 (Fed. Cir. Apr. 23, 2025).

Wakefield, proceeding pro se, sought to reopen a judgment invalidating his U.S. Patent No. 7,162,696 based on indefiniteness grounds more than two years after the district court's original judgment and more than a year after the Federal Circuit's affirmance. The Federal Circuit panel of Judges Lourie, Dyk, and Chen had little difficulty concluding that the district court did not abuse its discretion in finding the Rule 60(b) motion untimely. As the court emphasized, Rule 60(b) is not a substitute for appeal.

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Masters of Their Own Petition: The Federal Circuit’s Latest Stance on AAPA

Patent

by Dennis Crouch

One ongoing debate at the PTAB has been the role of Applicant Admitted Prior Art (AAPA) in inter pates review proceedings. AAPA refers to statements made by the patentee that admit that certain subject matter is part of the prior art. These statements are typically found in the background section and might include language like:

  • “It is well known that …”
  • “Conventional systems use …”
  • “Prior work includes …”
  • “As described in [reference], it is known that …”

Examiners rely heavily on AAPA, but IPR proceedings are limited to anticipation and obviousness grounds "and only on the basis of prior art consisting of patents or printed publications."   In Qualcomm Inc. v. Apple Inc., 24 F.4th 1367 (Fed. Cir. 2022) ("Qualcomm I"), the Federal Circuit sided with the patentee (Qualcomm), holding that AAPA contained within the challenged patent does itself constitute such prior art.  Still,  the obviousness determination looks at evidence beyond the prior art, such as the level of skill in the art, and motivation to combine references.  And, the court held that AAPA could be used to prove those facts. The court noted particularly that a petitioner may properly rely on AAPA "as evidence of the background knowledge possessed by a person of ordinary skill in the art" for purposes such as "furnishing a motivation to combine" or "supplying a missing claim limitation" as part of the obviousness analysis.  But see Arendi v. Apple (Fed. Cir. 2016).

Following Qualcomm I, the USPTO issued updated guidance in on the treatment of AAPA in IPRs. Director Katherine Vidal's new guidance explicitly acknowledged the Federal Circuit's ruling that "under § 311, 'patents or printed publications' that form the 'basis' of a ground for inter partes review must themselves be prior art to the challenged patent" and not the challenged patent itself or any admissions therein. The guidance clarified that it is "impermissible for a petition to challenge a patent relying on solely AAPA without also relying on a prior art patent or printed publication."

But, the updated USPTO guidance established what would later be termed an "in combination" rule, providing that "[i]f an IPR petition relies on admissions in combination with reliance on one or more prior art patents or printed publications, those admissions do not form 'the basis' of the ground and must be considered by the Board in its patentability analysis." The guidance identified several permissible uses of AAPA in IPR proceedings, including: "(1) supply[ing] missing claim limitations that were generally known in the art prior to the invention...or the effective filing date of the claimed invention; (2) support[ing] a motivation to combine particular disclosures; or (3) demonstrat[ing] the knowledge of the ordinarily-skilled artisan at the time of the invention...for any other purpose related to patentability."

Back to Qualcomm: On remand, the PTAB applied the USPTO's "in combination" rule to conclude that Ground 2 of Apple's IPR petition complied with § 311(b). The Board determined that since Apple's challenge relied on AAPA "in combination with" prior art patents (Majcherczak and Matthews), the AAPA did not form "the basis" of the ground in violation of § 311(b). The Board rejected Qualcomm's argument that Apple had expressly included AAPA as part of the "Basis" of Ground 2 in its petition tables, concluding that these statements merely described how the grounds included both AAPA and prior art patents used "in combination."

On appeal, the Federal Circuit has once again reversed. Qualcomm Incorporated v. Apple Inc., Nos. 2023-1208, 2023-1209 (Fed. Cir. Apr. 23, 2025) (Qualcomm II). The new panel concluded that Board's interpretation contravened the plain meaning of § 311(b). Rather, the Federal Circuit held that Apple's express designation of AAPA in the "Basis" of Ground 2 was determinative, ruling that the Board erred in concluding the challenged claims were unpatentable under Ground 2 when that ground improperly included AAPA as part of its basis in violation of § 311(b).

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The Priority Paradox: In re Floyd Highlights the Dual Standards of Written Description and Anticipation

Patent

by Dennis Crouch

While a design patent can technically claim priority to a prior utility patent, that approach takes some planning and forethought to ensure that the utility patent's drawings and disclosure sufficiently show possession of the specific ornamental design features that will later be claimed in the design application.  Ideally, the drawings in the utility filing would be identical to those later included in the design application.

This situation is exemplified by the Federal Circuit's recent decision In re Floyd (Fed. Cir. April 22, 2025) (non-precedential).  The claimed design is a cooling blanket -- with the drawings showing a 6x5 array pattern.  The priority filing included a 6x6 array, a 6x4 array, and a statement that the array could include a plurality of array layouts.  But, the priority filing did not specifically and expressly include the 6x5.  The result: priority claim denied for lack of written description.

The case also illustrates the "daylight" between written description and anticipation standards, creating a trap where an applicant's own published application can both fail to provide written description support yet anticipate a later filing.  In this case, although Floyd's prior published application was insufficient as a priority document, the court found it served perfectly well as an anticipatory reference.

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The Hughes-Reyna Divide Continues: Dongkuk v. US

Patent

by Dennis Crouch

In a new decision released April 21, 2025, the Federal Circuit has given us another example of the jurisprudential divide between Judges Hughes and Reyna–something that I’ve followed across numerous opinions. Dongkuk v. US continues this pattern in a case involving antidumping duties on Korean wind towers.

Anti-Dumping Law: Under the Tariff Act of 1930 (19 U.S.C. § 1673 et seq.), the Commerce Department investigates whether foreign manufacturers are selling products in the U.S. at less than fair value (“dumping”). This process begins when a domestic industry files a petition simultaneously with both the Commerce Department and the U.S. International Trade Commission (19 U.S.C. § 1673a(b)). Commerce compares U.S. export prices with either home market prices (19 U.S.C. § 1677b(a)(1)(B)) or a “constructed value” when home market sales are inadequate or below cost (19 U.S.C. § 1677b(e)). The constructed value calculation includes the cost of materials and fabrication, selling expenses, profits, and packaging costs (19 U.S.C § 1677b(e)(1)-(3)). If Commerce determines dumping has occurred, it calculates a “dumping margin” and imposes corresponding antidumping duties (19 U.S.C. § 1673).  Commerce’s final determinations are first appealed to the Court of International Trade (CIT) and then to the Federal Circuit, which has exclusive jurisdiction over appeals from the CIT pursuant to 28 U.S.C. § 1295(a)(5).

In Dongkuk, the Wind Tower Trade Coalition filed a petition alleging Korean utility-scale wind towers were being dumped in the U.S. market. Commerce selected Dongkuk S&C (DKSC) as the mandatory respondent and ultimately determined its products were being sold at less than fair value, imposing a 5.41% antidumping duty.  The CIT affirmed (after some back-and-forth). On appeal, the Federal Circuit has now also affirmed, with Judge Hughes writing for the majority and Judge Reyna in dissent. (more…)

The Non-Compete Ban: Impact on Patenting and Challenging Implementation

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by Dennis Crouch

Non-compete agreements fly under the radar for most American lawyers.  One reason is that such restrictions have long been banned within legal practice. As an example, the American Bar Association (ABA) Model Rule 5.6(a) prohibits lawyers from entering into agreements that restrict their right to practice law after terminating an employment, partnership, or other professional relationship. The rule's stated aim is to protect clients' freedom to choose their legal representation, but it also ensures that lawyers can practice their profession without restriction.

The increasing prevalence of non-compete agreements in other industries has drawn increasing scrutiny from policymakers and regulators, leading to the FTC's recent rule banning most non-compete agreements across the United States.  The new rule was announced on April 23, 2024 following a 3-2 vote by the FTC Commissioners (along party lines, with Democrats in the majority). It is set to take effect 120 days later (August 21, 2024). As I discuss below, two lawsuits have already been filed seeking to derail implementation.

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Without Undue Experimentation vs Without Any Experiments

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by Dennis Crouch

I was rereading the Supreme Court's recent enablement decision of Amgen Inc. v. Sanofi, 598 U.S. 594 (2023) and was struck by the Supreme Court's statement that its 19th Century decision of Wood v. Underhill, 46 U.S. 1 (1847) "establish[ed] that a specification may call for a reasonable amount of experimentation to make and use a patented invention."  This statement from Amgen is surprising because Chief Justice Taney's decision in Wood includes a seemingly contrary statement that bars any experimentation

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SCT: False Claims Act Actions Based Upon Fraudulently Obtained Patent Rights

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by Dennis Crouch

This post walks through a new petition for writ of certiorari involving claims that Valeant Pharma defrauded the U.S. government by using fraudulently obtained patent rights prop up its drug prices. [Read the Petition]

The False Claims Act (FCA), originally enacted in 1863 to combat contractor fraud during the Civil War, imposes civil liability on anyone who "knowingly presents" a "fraudulent claim for payment" to the federal government. 31 U.S.C. § 3729(a)(1)(A). The Act allows private citizens, known as "relators," to bring qui tam actions on the government's behalf against those who have defrauded the government. If successful, relators can recover up to 30 percent of the damages. 31 U.S.C. §§ 3730(b)(4), (d)(2).

To prevent opportunistic lawsuits, however, Congress has sought to strike a "balance between encouraging private persons to root out fraud and stifling parasitic lawsuits"

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UMKC School of Law Wins National Patent Application Drafting Competition

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By Chris Holman

Last week the U. S. Patent and Trademark Office announced the winner of this year’s National Patent Application Drafting Competition (NPADC), the University of Missouri-Kansas City School of Law. I teach patent law at UMKC, and was privileged to travel to Alexandria with the team of UMKC students (pictured below, from left to right, Will Knutson, Mark Trompeter, Joe Hooper, and Lukas Fields) to watch them compete and ultimately triumph in the final round of the competition. I am sure a great deal of the credit for their success can be attributed to our adjunct faculty members teaching patent prosecution at UMKC, James Devaney (Shook Hardy & Bacon) and Jon Hines (Senior Patent Counsel at 3Shape).

I would encourage any law student interested in pursuing a career in patent prosecution to consider participating in the competition next year. In a nutshell,

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What is Next for Enablement and Written Description of Antibody Claims?

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by Dennis Crouch

I had been following the case of Teva v. Lilly for a few years.  Teva has traditionally been a generic manufacturer, but in this case sued Eli Lilly for infringing its patents covering methods of treating headache disorders like migraine using humanized antibodies that bind to and antagonize calcitonin gene-related peptide (CGRP), a protein associated with migraine pain. U.S. Patent Nos. 8,586,045, 9,884,907 and 9,884,908.  The patents cover Teva's drug Ajovy, and allegedly cover Lilly's Emgality. Both drugs were approved by the FDA in September 2018.  A Massachusetts jury sided with Teva and awarded $177 million in damages, including a controversial future-lost-profit award.

Although the jury sided with Teva, District Judge Allison Burroughs rejected the verdict and instead concluded that Teva's patent claims were invalid as a matter of law for lacking

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Supreme Court Declines to Hear Vanda’s Patent Obviousness Appeal

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by Dennis Crouch

The Supreme Court has denied Vanda Pharmaceuticals' petition for certiorari, leaving in place a Federal Circuit decision that invalidated Vanda's patents on methods of using the sleep disorder drug Hetlioz (tasimelteon) as obvious.

Vanda had argued in its cert petition that

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Importance of Due Diligence for Patent Practitioners and the US/China Economic War

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by Dennis Crouch

37 C.F.R. § 11.18(b) imposes crucial responsibilities on patent applicants, attorneys, and agents. Documents submitted to the USPTO implicitly certify that:

  1. Statements made are true or are are believed to be true (based upon information and belief) and do not include any attempt to conceal a material fact; and
  2. That a reasonable inquiry was conducted to confirm that: (i) statements have no improper purposes, (ii) legal contentions are supported by existing law or valid arguments for change, (iii) allegations and factual contentions have or are likely to have evidentiary support, and (iv) denials of factual contentions are based on evidence or a reasonable lack of information or belief.

Recent USPTO disciplinary cases underscore the seriousness of these obligations. Examples include filing a micro entity status request without proper investigation and submitting an information disclosure statement (IDS) by a non-practitioner without practitioner review. Rubber stamping is not permitted.

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Functional Claims: Morse, Halliburton & Amgen

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by Dennis Crouch

In the patent context, functional limitations describe inventions in terms of their function or intended use, rather than their specific structure or components. Such claims have been subject to much debate and litigation throughout the history of the US patent system. Notable Supreme Court cases like O'Reilly v. Morse, 56 U.S. (15 How.) 62 (1854) and Halliburton Oil Well Cementing Co. v. Walker, 329 U.S. 1 (1946) significantly impacted patent practice and the balance between functional and structural claim drafting.

The pending Supreme Court case of Amgen Inc. v. Sanofi, No. 21-757 (2023) is another example, with the potential to further shift the landscape regarding functional claim limitations. The title of my essay on the case following oral arguments, "Bye Bye Functional Claims," hints at my outlook. Although the patentee focused on other issues in its briefing, the Justices repeatedly questioned the permissibility of broad functional claim limitations.

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