IP Rights and AI Regulation: Finding the Right Balance

Patent

by Dennis Crouch

I’m excited to share a new article I recently published examining the relationship between intellectual property rights and artificial intelligence regulation, recently published in Volume 89, Issue 3 of the Missouri Law Review. Before diving into the substance, I want to express my sincere gratitude to the Missouri Law Review editors and staff, not only for their exceptional editorial work on this article but also for their tremendous efforts in organizing our March 2024 symposium that I co-organized on “AI and Society: Government, Policy, and the Law.” The symposium brought together dozens of leading scholars to explore the pressing challenges of AI governance, and those discussions helped shape many of the ideas presented in the piece.

The article builds on foundational work of scholars, including Amanda Levendowski, who has explored how copyright law can address AI bias, as well as Mark Lemley and Bryan Casey, whose research on “fair learning” has shaped our understanding of AI training and copyright.  My article argues that we should be cautious about viewing IP as a primary regulatory tool. (more…)

From Chief Judge Markey’s Promise to Rule 36: We Do Not Just Render One-Worded Decisions

Patent

by Dennis Crouch

The Supreme Court currently has before it a unique opportunity to address a longstanding problem with the Federal Circuit’s practice of issuing no-opinion summary affirmances in patent cases. The recently filed ParkerVision petition presents a compelling argument that the Federal Circuit’s heavy reliance on Local Rule 36 judgments violates 35 U.S.C. § 144’s requirement that the court “shall issue… its mandate and opinion” when deciding appeals from the Patent Office. This violation has become particularly acute given the surge in appeals from Patent Trial and Appeal Board (PTAB) decisions in recent years. ParkerVision vs. TCL Indus., 24-518.  While appellate opinions serve fundamental interests of human dignity and the rule of law — interests that take on special significance as here when no other Article III court has addressed the dispute — this case presents an even clearer problem because Congress has specifically mandated through Section 144 that the Federal Circuit ‘shall issue’ an opinion in appeals from USPTO decisions.

The ParkerVision petition arises from the Federal Circuit’s summary affirmance of PTAB decisions that invalidated the patentee’s claims related to wireless communication technology. After TCL and LG Electronics successfully challenged the patents via inter partes review (IPR), ParkerVision appealed to the Federal Circuit raising procedural questions about whether the PTAB improperly relied on arguments that had been waived. Rather than addressing the merits of the arguments, the Federal Circuit instead disposed of both appeals without any opinion and rather simply an “AFFIRMED” judgments under Rule 36, providing no explanation for its decisions.

The question presented thus asks:

Whether 35 U.S.C. § 144, which requires the Federal Circuit to issue ‘opinion[s]’ in PTAB appeals, is a reason-giving directive that prohibits the Federal Circuit’s practice, under Federal Circuit Rule 36(a), of summarily affirming PTAB decisions without issuing opinions.

ParkerVision vs. TCL Indus., 24-518 (petition for writ of certiorari).

More reading:

(more…)

Oral Arguments Preview: Teva v. Amneal Tests Scope of Orange Book Device Patent Listings

Patent

by Dennis Crouch

Today at 2pm Eastern, the Federal Circuit will hear arguments in a case that could significantly shape pharmaceutical patent listing practices under the Hatch-Waxman Act. In Teva v. Amneal (No. 24-1936), the court will consider whether device patents that don't explicitly recite active drug ingredients can be properly listed in FDA's Orange Book. William Jay of Goodwin Procter will argue for Teva; Steven Maddox of Procopio will represent Amneal.  The judges are not yet listed for the case, but I expect it will be three judges picked from these six: Chief Judge Moore, Judge Dyk, Judge Prost, Judge Chen, Judge Hughes, or Judge Stark.  (Update: It is judges: Prost, Taranto, and Hughes).

The case centers on several Teva patents related to its ProAir HFA inhaler device and dose counter. After Amneal filed an ANDA for a generic version, it counterclaimed--seeking delisting of these patents from the Orange Book. The N.J. district court granted Amneal's motion, ordering Teva to delist the patents. The key question on appeal is whether device patents must explicitly claim the active drug ingredient to qualify for Orange Book listing under 21 U.S.C. § 355(b)(1)(A)(viii).  The key benefit to patentees is an automatic 30-month stay of FDA approval that kicks in if the patentee sues a generic ANDA filer. This effectively blocks generic entry during litigation without requiring the patentee to show likelihood of success or irreparable harm as would be needed for a preliminary injunction.

To continue reading, become a Patently-O member. Already a member? Simply log in to access the full post.

The Federal Circuit’s Antisuit Injunction Decision in Ericsson v. Lenovo has Broader Implications for Global SEP Litigation

Patent

I previously wrote about the Federal Circuit’s FRAND international injunction decision in Ericsson v. Lenovo, but also invited Prof. Jorge Contreras to provide his insight.  Contreras is one of the world’s leading experts on FRAND litigation and standards-essential patent licensing.  His analysis of the Federal Circuit’s decision in Ericsson particularly highlights the court’s new limits on injunctive relief for FRAND violators and suggests renewed U.S. court engagement in global rate-setting disputes. — Dennis Crouch

= = =

Guest Post by Professor Jorge L. Contreras

On October 24, 2024, the Court of Appeals for the Federal Circuit (No. 24-1515, 2024 U.S. App. LEXIS 26863) cleared the way for Lenovo to seek an antisuit injunction against Ericsson in the parties’ global FRAND litigation. In doing so, it established important precedent for cases involving standards-essential patents.

Background

The case stems from the dispute between Ericsson and Lenovo over licenses to their respective portfolios of patents essential to the 5G wireless telecommunications standards (standards-essential patents or SEPs). Under the applicable rules of the European Telecommunications Standards Institute (ETSI), each of the parties committed to grant licenses under its SEPs to manufacturers of standardized products on terms that are fair, reasonable and nondiscriminatory (FRAND). As the parties, after years of negotiation, were unable to agree on the FRAND royalties for a cross-license of these SEPs, they each initiated litigation in various jurisdictions including the United Kingdom, Brazil, Colombia, the US International Trade Commission and the U.S. District Court for the Eastern District of North Carolina (EDNC). In the EDNC, each party accused the other of infringing its 5G SEPs and breaching its contractual FRAND obligations to ETSI.

In late 2023, Ericsson obtained injunctions against Lenovo’s sale of 5G-enabled phones in Brazil and Colombia. In response, Lenovo petitioned the EDNC for an antisuit injunction (ASI) (technically, a temporary restraining order), which would have barred Ericsson from enforcing its Brazilian and Colombian injunctions against Lenovo until the resolution of the FRAND dispute in the U.S. court. In February 2024, the EDNC denied Lenovo’s motion for an ASI (No. 5:23-CV-00569-BO, 2024 U.S. Dist. LEXIS 26060, 2024 WL 645319).  Lenovo appealed to the Federal Circuit, which reversed and remanded. (more…)

Text vs. Purpose: The Hughes-Reyna Divide Reaches Veterans’ Benefits in Soto

Patent

by Dennis Crouch

The Supreme Court has before it another important petition highlighting the Federal Circuit's approach to statutory interpretation and administrative authority. Soto v. US stems from a Federal Circuit appellate decision focusing on the statute of limitations for awarding back pay associated with Combat-Related Special Compensation. The Supreme Court also recently heard oral arguments in Bufkin v. McDonough, which presents another important question about veterans' benefits - specifically whether the Court of Appeals for Veterans Claims must independently review the VA's application of the "benefit-of-the-doubt" rule in veterans' cases. The University of Missouri Veterans Clinic has played an active role in both of these pending cases as amicus counsel.

The pending Soto v. US petition highlights a recurring philosophical divide between Federal Circuit Judges Hughes and Reyna, with Hughes taking a formalist approach requiring specific statutory language while Reyna advocates for a more functional analysis that favors the underdog (disabled veterans). This post first walks through the Soto case and pending petition and then delves a bit deeper into the contrast between these two leading jurists at the Federal Circuit.

To continue reading, become a Patently-O member. Already a member? Simply log in to access the full post.

A Tale of Two Dewberries: Corporate Structure vs. Trademark Remedies

Patent

by Dennis Crouch

The Supreme Court is set to hear arguments in Dewberry Group v. Dewberry Engineers (No. 23-900) in December 2024, addressing the trademark-specific question of whether courts can disgorge profits earned not by the defendant itself, but also by legally separate non-party corporate affiliates.  In many ways, I see this case largely as a corporate "structure of the firm" case.  Does trademark law permit business owners to formally structure their set of closely related businesses to avoid spillover liability?  Most notably, corporate attorneys are regularly looking at ways to divide companies to limit spillover liability. The golden target is to create low-profit (or non-profit) entities that hold all the potential liability; and then shift profits to other corporate affiliates that do not have any liability.  In the trademark sense, you may have a media holding company that does all the infringing advertising; and then a set of franchisees that don't do any advertising themselves, but do reap the profits.

Background: The Dewberry dispute involves two real estate-related companies: Dewberry Group (defendant/petitioner) and Dewberry Engineers (mark-holder/respondent). After finding that Dewberry Group had infringed Dewberry Engineers' trademarks, the district court ordered Dewberry Group to disgorge nearly $43 million in profits. But here's the twist - those profits were earned not by Dewberry Group itself (which actually showed losses), but by its affiliated companies that were never parties to the litigation.

To continue reading, become a Patently-O member. Already a member? Simply log in to access the full post.

Supreme Court Asked to Address Constitutionality of Judge Newman Removal

Patent

by Dennis Crouch

Miller Mendel, Inc. has petitioned the Supreme Court to review a Federal Circuit decision invalidating its background check software patent in a case that raises questions about both judicial independence and patent eligibility standards. The petition comes after both the district court and Federal Circuit found Miller Mendel's US Patent No. 10,043,188 ineligible under § 101 as directed to an abstract idea.

The Patent and Technology at Issue: The '188 patent covers a software system for managing pre-employment background investigations. The claimed system automates many aspects of the background check process, including collecting and storing applicant information, managing communications with references via email hyperlinks, and automatically generating suggested lists of law enforcement agencies based on an applicant's residential address.  Miller Mendel accused the City of Anna police department (northern Texas) of infringement through its use of Guardian Alliance Technologies' background check platform. The City successfully moved for judgment on the pleadings arguing patent ineligibility under § 101. The court characterized the claimed automation features as merely implementing conventional background check steps on generic computer components.

Three Questions for Supreme Court Review

The petition, filed by Kurt Rylander of Rylander & Associates, presents three questions that go to fundamental issues in patent law and judicial administration:

1. Constitutionality of Removing Article III Judges

The most striking issue challenges the Federal Circuit's effective removal of Judge Pauline Newman from judicial duties for refusing to submit to mental health evaluations. The petition argues that the Federal Circuit's self-policing usurped Congress's exclusive constitutional authority to remove Article III judges through impeachment. 

To continue reading, become a Patently-O member. Already a member? Simply log in to access the full post.