This is the third eligibility post in as many days. In a non-precedential decision issued September 10, 2024, the Federal Circuit affirmed the PTAB's rejection of claims in a patent application directed to eliciting tips for media content -- finding them ineligible. In re McDonald, No. 24-1015 (Fed. Cir. Sept. 10, 2024).
The applicant here is a Utah start-up VidAngel, Inc., that helps folks "Filter out the stuff you don’t want to see or hear in your streaming movies & TV shows, like profanity, nudity, violence & more. But, the invention here has a different focus - it is a setup for eliciting and receiving tips from consumers of media content like streaming movies.
In Contour IP v. GoPro, the Federal Circuit has reversed a Judge Orrick (N.D.Cal.) summary judgment of ineligibility. The case here should be one for patent drafters to consider -- particularly thinking about how to incorporate specific technological improvements into their patent claims and specification (while still maintaining broad claim coverage). Of course, the patentee here has the benefit of actual hardware beyond mere processing.
Contour owns two patents related to POV video cameras. These patents claim a camera system having lenses, sensors, etc., that generates two video streams of different quality in parallel, wirelessly transmitting the lower-quality stream to a remote device for real-time viewing and control on your phone. The higher-quality stream is stored on the camera for later use.
For over 150 years, "user interfaces" have been a staple of patent protection, evolving from the physical realm of tool handles and knobs to today's digital screens. Although tangible interface elements continue be patented as components of larger systems, the market shift towards on-screen interfaces has been paralleled with the anti-eligibility shift in Mayo and Alice. The Federal Circuit recently waded into these murky waters in Broadband iTV, Inc. v. Amazon.com, Inc., No. 23-1107 (Fed. Cir. Sept. 3, 2024), examining the patent eligibility of electronic programming guides and content recommendation systems. Affirming a decision by Judge Albright, the appellate panel held that the claimed inventions lacked eligibility under 35 U.S.C. § 101, distinguishing some prior GUI cases that sided with the patentee.
Means-plus-function claims have generally been disfavored because of the tendency of courts to either (1) narrowly construe their scope when corresponding structure is detailed in the specification or (2) render them invalid as indefinite when the specification lacks sufficient corresponding structure. If Impact Engine's petition is well received, there is a good chance that this historically popular claim style will see a revival.
The Federal Circuit's recent decision in Impact Engine v. Google has again raised the issue of over the proper treatment of MPF, this time regarding patent eligibility and infringement analyses. Appeal No. 22-2291 (Fed. Cir. July 3, 2024). I had skipped a write-up of the non-precedential decision, but now Impact Engine has petitioned for en banc review, arguing that
In Rady v. The Boston Consulting Group, Inc., No. 2022-2218 (Fed. Cir. Mar. 27, 2024), the Federal Circuit affirmed the dismissal of a patent infringement lawsuit, holding that the asserted claims of Rady's US10469250 were ineligible under 35 U.S.C. § 101. The patent, owned by Max Rady, patent describes scanning a physical item, determining its unique pattern of imperfections (i.e., "signature"), and recording that signature to a blockchain if not previously registered.
I've become somewhat callous toward patent eligibility jurisprudence and so was surprised when I read the Federal Circuit's decision in ADASA Inc. v. Avery Dennison Corp., 55 F.4th 900 (Fed. Cir. Dec 16, 2022). The case concluded that constructively dividing a fixed-length binary number into different sub-portions was not an abstract idea. Now, the accused infringer has asked the Supreme Court for review.
ADASA's US Patent 9,798,967 is directed toward an RFID chip "encoded with a unique object number." This object number as various blocks pre-allocated to identify the selling-company, product reference, and serial number as shown below. The serial number has a unique feature of being divided into a section of "most significant bits" (MSBs) and "least significant bits" (LSBs). This division between MSBs and LSBs help in the allocation of unique serial numbers in a distributed production system. The basic approach:
A product-line will be exclusively allocated a particular MSB and all possible accompanying LSBs. It will then enable RFID chips using the allocated MSB and then sequentially incrementing the LSB.
A separate product line might also be simultaneously enabling other other chips. To ensure no overlap in serial numbers, the second-line will be allocated a different MSB.
The result then is that we can guarantee that each chip has a unique serial number despite parallel production lines.
The claims do not appear to include any novel features other than this constructed division between bits in a binary number. (Claim 1, is reproduced below). In its petition, the adjudged infringer relies heavily on the old cases of Benson and Flook to argue that the setup here lacks eligibility.
Question presented:
Radio Frequency Identification Device (RFID) tags are encoded with lengthy serial numbers that uniquely identify particular items. The patent at issue in this case designates the leading bits in a binary serial number as “the most significant bits,” and directs that all serial numbers in an allocated block begin with the same “most significant bits.”
The question presented is whether that claim, by subdividing a serial number into “most significant bits” that are assigned such that they remain identical across RFID tags, constitutes patent-eligible subject matter under 35 U.S.C. § 101.
Chief Judge Moore wrote the opinion and concluded that the claims were not directed to an abstract idea but rather provides a novel data structure within a serial number. Here, the idea is that the patentee was able to create a new data field that was "not a mere mental process, but a hardware-based data structure focused on improvements to the technological process by which that data is encoded;" and an improvement with "important technological consequences."
An interesting feature is that the general idea presented by the patentee was already identified and discussed in the book RFID for Dummies. If Avery Dennison loses here, then the district court will hold a trial on anticipation. Still, the "for Dummies" label has strong rhetorical appeal -- should everything in that book title be considered an abstract idea? The petitioner writes:
“[A]bstract ideas are not patentable.” ... It is hard to imagine a more blatant transgression of that rule than the claim in this case, which sought a patent monopoly over the simple concept of treating one long serial number as the combination of two shorter numbers, and then [requiring] blocks of RFID tags all start with the same shorter number. At bottom, that claim is no different from a direction to mentally subdivide all telephone numbers into two component parts and then assign the same leading part to an allocated block of numbers (e.g., all telephone numbers in the District of Columbia start with 202). That may be a good idea (indeed, the concept in ADASA’s patent appears in the pages of RFID for Dummies), but it is no more patentable than the other good but abstract ideas that this Court has held unpatentable for more than 150 years.
Id. I'm confident that if the Supreme Court takes this case, it would even further expand eligibility doctrine.
Douglas Dynamics v. Meyer Prods (W.D. Wisc 2017) [2017-04-18 (68) Order re post IPR invalidity defenses].After Douglas sued Meyer for infringing its U.S. Patent No. 6,928,757 (Snowplow mounting assembly), Meyer petition for inter partes review -- alleging that several of the claims were invalid. Although the "director" iniated the review, the PTAB eventually sided with the patentee - reaffirming the validity of the claims.
Back at the district court, Douglass asked the court to apply the estoppel provisions that of Section 315(e)(e):
The petitioner in an inter partes review ... that results in a final written decision under section 318(a) . . . may not assert . . . in a civil action arising [under the patent laws] . . . that the claim is invalid on any ground that the petitioner raised or reasonably could have raised during that inter partes review.
35 U.S.C. § 315(e)(2). The question for the district court here, was the scope of estoppel - what constitutes grounds that were "raised or reasonably could have [been] raised" during the IPR. Here, the court took a position for fairly strong estoppel:
If the defendant pursues the IPR option, it cannot expect to hold a second-string invalidity case in reserve in case the IPR does not go defendant’s way. In many patent cases, particularly those involving well-developed arts, there is an abundance of prior art with which to make out an arguable invalidity case, so it would be easy to have a secondary set of invalidity contentions ready to go. The court will interpret the estoppel provision in § 315(e)(2) to preclude this defense strategy. Accordingly, the court will construe the statutory language “any ground that the petitioner . . . reasonably could have raised during that inter partes review” to include non-petitioned grounds that the defendant chose not to present in its petition to PTAB.
In Shaw Industries Group, Inc. v. Automated Creel Systems, Inc., 817 F.3d 1293 (Fed. Cir.), the Federal Circuit wrote in dicta that no estoppel should apply to grounds that were petitioned, but not instituted. The Wisconsin court here suggested some potential problems with that outcome, but decided to follow the CAFC's lead, writing:
So until Shaw is limited or reconsidered, this court will not apply § 315(e)(2) estoppel to [petitioned but] non-instituted grounds, but it will apply § 315(e)(2) estoppel to grounds not asserted in the IPR petition, so long as they are based on prior art that could have been found by a skilled searcher's diligent search.
What this means for the defendant here is that the only 102/103 arguments that it gets to raise are ones already deemed total failures by the PTAB - and thus are unlikely winners before a district court.
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Of some importance, the PTAB's final written decision was released in November 2016. For estoppel purposes, that final decision is all that is required for estoppel to kick-in. However, the case currently on appeal to the Federal Circuit -- already giving the defendant its second bite at the apple.
In the latest decision by the UK High Court of Justice (Patents) in Unwired Planet v. Huawei ([2017] EWHC 711 (Pat), 5 Apr. 2017], Mister Justice Colin Birss has issued a detailed and illuminating opinion regarding the assessment of royalties on standards-essential patents (SEPs) that are subject to FRAND (fair, reasonable and non-discriminatory) licensing commitments. Among the important and potentially controversial rulings in the case are:
Single Royalty: there is but a single FRAND royalty rate applicable to any given set of SEPs and circumstances,
Significance of Overstep: neither a breach of contract nor a competition claim for abuse of dominance will succeed unless a SEP holder’s offer is significantly above the true FRAND rate,
Global License: FRAND licenses for global market players are necessarily global licenses and should not be limited to a single jurisdiction, and
Soft-Edge: the “non-discrimination” (ND) prong of the FRAND commitment does not imply a “hard-edged” test in which a licensee may challenge the FRAND license that it has been granted on the basis that another similarly situated licensee has been granted a lower rate, so long as the difference does not distort competition between the two licensees.
Background
This case began in 2014 when Unwired Planet, a U.S.-based patent assertion entity, sued Google, Samsung and Huawei for infringement under six UK patents (corresponding actions were filed in Germany). Unwired Planet claimed that five of the asserted patents, which it acquired from Ericsson in 2013 as part of a portfolio comprising approximately 2000 patents, were essential to the 2G, 3G and 4G wireless telecommunications standards developed under the auspices of the European Telecommunications Standards Institute (ETSI). Because Ericsson participated in development of the standards at ETSI, any patents shown to be SEPs would necessarily be encumbered by Ericsson’s FRAND commitment to ETSI.
The UK proceedings involved numerous stages, including five scheduled “technical trials” which would determine whether each of the asserted patents was valid, infringed and essential to the ETSI standards. During these proceedings Google and Samsung settled with Unwired Planet and Ericsson (which receives a portion of the licensing and settlement revenue earned by Unwired Planet from the patents), leaving Huawei as the sole UK defendant. By April 2016 three of the technical trials had been completed, resulting in findings that two of the asserted patents were invalid and that two were both valid and essential to the standards. These findings are currently under appeal. The parties then agreed to suspend further technical trials. In October 2016 a “non-technical” trial began regarding issues of competition law, FRAND, injunction and damages. Hearings were concluded in December 2016, and the court’s opinion and judgment were issued on April 5, 2017.
A. The High Court’s Decision – Overview
The principal questions before the court were (1) the level of the FRAND royalty for Unwired Planet’s SEPs, (2) whether Unwired Planet abused a dominant position in violation of Section 102 of the Treaty for the Formation of the European Union (TFEU) by failing to adhere to the procedural requirements for FRAND negotiations outlined by the European Court of Justice (CJEU) in Huawei v. ZTE (2014), and (3) whether an injunction should issue in the case. In the below discussion, Paragraph numbers (¶) correspond to the numbered paragraphs in the High Court’s April 2017 opinion.
B. FRAND Commitments – General Observations
Justice Birss begins his opinion with some general observations and background about the standard-setting process and FRAND commitments. A few notable points emerge from this discussion.
After Douglas sued Meyer for infringing its 