Tag Archives: Federal Circuit En Banc

Humerus Claim Construction: Plain Meaning Redux

Patent, ,

Acumed v. Stryker (Fed. Cir. 2007).

Acumed and Stryker both manufacture equipment for orthopedic surgery. Based on its patented nail technology for reconstructing humerus fractures, Acumed sued Stryker for patent infringement. A jury found the claims valid and that Stryker was a literal and willful infringer. Based on the verdict, the Oregon judge assessed enhanced damages and entered a permanent injunction against the adjudged infringer.  Stryker appealed infringement and willfulness.

Claim Construction: The most-disputed aspect of the case involved the court’s interpretation of the claim term “transverse holes.” Every figure showed the holes, showed them extending “perpendicularly through the shaft.” Similarly, the description noted that the holes were “perpendicular.”  Based on this intrinsic evidence and the precedential value of Phillips, Stryker argued that the claim term should be given a narrow meaning.

On appeal, the CAFC refused to limit “transverse holes” to holes that were arranged perpendicularly. In doing so, the court reestablished that the paramount rule of construction is that claims are given their plain meaning.

The plain meaning … covers more than the particular embodiment shown…. While the disclosed embodiment possesses “perpendicular” holes, the claim language covers all “transverse” holes—a word that does not necessarily imply right angles. Moreover, the patentees’ description of their preferred embodiment itself implies a difference between the words “perpendicular” and “transverse.”

In its analysis, the Court implied reasoning similar to that of claim differentiation.  Here, however, the analysis compared the use of “perpendicular” in the specification with the word “transverse” as used in the claims.

The written description states that Figure 2 “illustrates a plurality of transverse holes, each of which is . . . perpendicular to the portion of the nail axis at the butt portion 14 of the nail.” ’444 patent col.2 ll.56-59. This implies that a “transverse” hole need not be “perpendicular”—if it were, the patentee would not have needed to clarify that these holes, in addition to being transverse, were perpendicular to the nail axis.

This case follows the same pattern as the en banc decision of  Phillips v. AWH:

Just as in Phillips, where the asserted claim mentioned “steel baffles” and hence “strongly implie[d] that the term ‘baffles’ does not inherently mean objects made of steel,” this usage of language is strong evidence that the patentee considered “transverse” and “perpendicular” to have distinctly different meanings.

Narrowing Intrinsic Evidence: The court refused to give credence to the interpretation of the term “transverse” found in prior art that was cited on the face of the patent because the reference was not “created by the patentee in attempting to explain and obtain the patent.”

Judge Kimberly Moore dissented from this claim interpretation.  Judge Moore would have held that the intrinsic evidence “fully supports” defining “transverse” as “made at right angles to the anterior-posterior axis of the body”.

The majority suggests that the use of both words “implies a difference between the words ‘perpendicular’ and ‘transverse.’” The majority contends that if transverse was meant to be construed as perpendicular, “the patentee would not have needed to clarify that these holes, in addition to being transverse, were perpendicular to the nail axis.” I disagree… [T]he patentee used the two words to clearly specify which of the definitions of transverse applied to his invention; the purpose of using the word “perpendicular” was to further describe what the inventor meant by the term “transverse,” not to distinguish it as the majority suggests.

Willfulness Affirmed:

[T]wo patent attorneys … at first strongly discouraged Stryker from marketing the infringing nail in the United States. Despite that advice, Stryker continued to push towards a United States market entry, filing its FDA application months before it received … revised [non-infringement] legal advice….The judgment of willfulness is therefore affirmed.

Permanent Injunction: Because the case was decided before eBay, the CAFC remanded for a finding on the equities.

Claim Differentiation

Patent,

Andersen Corp. v. Fiber Composites (Fed. Cir. 2007).

Claim differentiation is based on a “common sense” presumption that different words used in the various claims indicate that the claims differ in focus and scope. Andersen holds a number of patents related to fiber materials and sued Fiber Composites for infringement.  Fiber Composites used the material for deck railing. Several of the claims included terms such as pellets, linear extrudates, or composites. 

Overcoming the Presumption of Claim Differentiation: Based on the concept of claim differentiation, Andersen argued that the composite limitation must not be limited to pellets and linear extrudates.  In its decision, the CAFC agreed that – in the abstract – Andersen’s argument was sound.  However, the appellate body found “powerful evidence” in both the specification and prosecution history that overcome the presumption of claim differentiation. In particular, the applicant lumped the three elements together when making arguments and discussed the pellet form as an ‘essential’ part of the invention.

Differentiation of Elements vs. Claims: It is also important to remember that the doctrine is that of claim differentiation rather than element differentiation.  Claim differentiation is not necessary unless the claims as a whole are redundant.

“A further reason for not applying the doctrine of claim differentiation in this case is that the … claims are not otherwise identical but for the references to pellets, linear extrudates, and composite compositions, and thus the district court’s construction does not make the composite composition claims redundant. Instead, there are numerous other differences varying the scope of the claimed subject matter….

Even though the “composite composition” claims, as construed by the district court, cover substantially the same subject matter that is covered by the “pellet” and “linear extrudate” claims, overlapping patent claims are not unusual, and the overlap does not require us to construe the “composite composition” claims to cover subject matter that differs from the subject matter covered by the other two sets of claims. Under these circumstances, the doctrine of claim differentiation does not require rejection of the district court’s construction of the claims.

Consequently, the CAFC ruled that the composite elements were no broader than the claimed pellets or extrudates.

Notes:

  • This is a case from January 2007.  I missed it because the Seagate en banc order was released the same day.

In re Seagate: Scope of Opinion Waiver

Patent

A tremendous amount of litigious time and energy is spent fighting over opinions of counsel and associated waivers.  Formal non-infringement or invalidity opinions are usually designed for litigation — their sole purpose to reduce that a defendant will be held liable for treble damages.  The formal opinions are — as you might expect — stiff and formal. The good ones are exceedingly thorough and cover all the legal bases.  Yet, formal opinions often fall far short of honestly answering the important question: "What are my chances of winning if I’m sued on this patent?"  That question is much more nuanced.

Opinions of counsel are protected as attorney work product and usually attorney-client privilege as well.  When the opinion is presented to court, those protections are waived.  Many courts extend the scope of the waiver to include any related opinions (whether formal or informal) provided to the client. This waiver has, on occasion, been extended to litigation counsel even when an outside firm provided the formal opinion. 

The logic behind the broad waiver may help avoid nefarious behavior: A potential defendant would like to obtain several separate opinions, then only produce the ‘best’ one.  Such a scenario would hardly comport with the ‘reasonable reliance’ standard.  In addition, a broad wavier helps the patentee’s counsel ensure that any opinion is based on a solid background rather than potentially faulty information. (sword vs. shield)

One reason why waiver issues are fought so fiercely is that court outcomes are all-over-the-map. Some courts grant broad waivers while others are quite narrow.

In Seagate, the lower court granted a broad waiver to include otherwise privileged communication between the defendant and its trial counsel "even if it is communicated in the context of trial preparation."  The waiver was also extended to include in-house counsel’s internal discussions with business executives.  The Court of Appeals for the Federal Circuit, acting sua sponte, has requested an en banc hearing to determine the scope of opinion waivers.

In its opening brief, Seagate takes the position that "opinion and trial counsel have entirely different roles," and those roles require that the waiver be limited to opinion counsel.  Seagate also focuses on the result — that litigation attorneys will stop talking with their clients, resulting in worse legal representation. Clear rules will also "foster predictability."

I agree that this case is very important for patent litigants, but the interesting aspect involves the interplay between general practice and boutique firms. (More to come on this).

Documents:

Notes:

En Banc Panel to Determine Scope of Opinion Waiver

Patent

In Re Seagate Technology (Fed. Cir. 2007).

The Federal Circuit has decided sua sponte to an en banc hearing addressing the following questions:

  1. Should a party’s assertion of the advice of counsel defense to willful infringement extend waiver of the attorney-client privilege to communications with that party’s trial counsel? See In re EchoStar Commc’n Corp., 448 F.3d 1294 (Fed. Cir. 2006).
  2. What is the effect of any such waiver on work-product immunity? 
  3. Given the impact of the statutory duty of care standard announced in Underwater Devices, Inc. v. Morrison-Knudsen Co., 717 F.2d 1380 (Fed. Cir. 1983), on the issue of waiver of attorney-client privilege, should this court reconsider the decision in Underwater Devices and the duty of care standard itself?

DOCS

NOTE:

  • As I suggested earlier this week, the CAFC has begun to test publication of merits briefs on its www.cafc.uscourts.gov website.
  • The Order indicates that Amici will be entertained “in accordance with [FRAP] 29 and Federal Circuit Rule 29.” This likely means that the court will grant leave to all amici briefs, although that meaning is unclear.

Inducement Requires Knowledge of The Patent and Culpable Mens Rea

CAFC, En Banc, Inducement, Medical Device, Patent

PatentlyO2006017DSU Medical v. JMS (Fed. Cir. 2006) (en banc)

The interesting portion of this opinion rests in Section III.B, where the CAFC convened an en banc panel to clarify that “inducement” of infringement requires intent to induce actual infringement, which necessarily requires knowledge of the patent.

Section 271(b) of the Patent Act spells out the tort: “Whoever actively induces infringement of a patent shall be liable as an infringer.”

Applying the language of Grokster, the CAFC clarified that in patent cases, “the intent requirement for inducement requires more than just intent to cause the acts that produce direct infringement. . . . [I]nducement requires evidence of culpable conduct, directed to encouraging another’s infringement.”  According to the court, this culpable conduct requires knowledge of the patent and an intent to induce infringement of the patent.

As Kevin Noonan has noted, the distinction in this case is that “there was evidence (an opinion of counsel and testimony from corporate officials) that the defendant believed that the accused behavior was not infringement. Thus, CAFC said the evidence supported the trial court’s finding that the defendant did not intend to induce infringement, which was the mens rea required for liability under 35 USC 271(b).”

Bruckelmyer Stands — Expands Scope of Available Prior Art

Patent

Bruckelmyer v. Ground Heaters (Fed. Cir. 2006).

Bruckelmyer has two patents on methods of thawing frozen ground so that a layer of concrete can be laid on top of the ground. In a decision earlier this year, the CAFC found that Bruckelmyer’s patents were obviated by the contents of a Canadian patent file history — thus affirming a summary judgment of invalidity.

On appeal, Bruckelmyer argued that the unpublished Canadian patent documents were not a “printed publication” under 35 U.S.C. Section 102(b) and thus, was not prior art. The CAFC found that the originally filed application was “publicly accessible,” and thus a prior art “printed publication” because the Canadian prosecution file was open to the public more than a year before Bruckelmyer filed his application.  Here, the Court found that this particular application could be located because the related patent discussed a solution for the same problem addressed by Bruckelmyer’s patents.

The CAFC has now denied Bruckelmyer’s request for rehearing en banc.  However,  Judge Newman presented a forceful dissent from the denial of rehearing:

It is undisputed that these [disclosures] are not available in any database or any library, and that no index, no catalog, no abstract suggests their existence or their content. It is not contested that the only way to obtain these [disclosures] (although their existence was unknown) is to personally go to the Canadian Patent Office in Hull, Quebec, and ask to examine the file wrapper (the prosecution history) of this particular patent, which is entitled “Portable Construction Heating System”. This is not the method for heating frozen ground in preparation for pouring concrete, which is the subject of the patent in suit. The only lead to this particular Canadian prosecution record, we are told, is to observe that the broad recitation in the Canadian patent that “other typical uses [of the invention] are . . . thawing frozen ground,” and then to travel to Quebec to examine the file wrapper to see if it might contain information that was deleted from the Canadian application before issuance. This excised and unpublished and unreferenced material is not a “printed publication,” no matter how generously that concept is defined. This court improperly relies on it to invalidate the United States Patents here at issue. . . . As Judge Linn observes in his dissent, a person searching for prior art cannot be reasonably expected to look in the prosecution history of a foreign patent that does not disclose the invention, on the off chance that its inventor might have invented something relevant to the search, and then cancelled it from the application before grant.

Notes:

CAFC “Clarifies” Design Patent Jurisprudence but Denies Rehearing En Banc

Patent, Patent Cases 2006,

AIPLATalk070Lawman Armor v. Winner Int’l (Fed. Cir. 2006, en banc).

In February 2006, the Federal Circuit decided Lawman Armor in a way that utterly devalued design patents.  The decision appeared to read a design patent would never be enforceable if the patent was simply a novel combination of known elements.  Essentially, the decision held that, for the point of novelty test, multiple prior art references could be combined without any prior suggestion or motivation for doing so.  As noted in the AIPLA’s amicus brief requesting rehearing, if this result were true, there would be very few enforceable design patents because most (if not all) designs are combinations of old forms.

On motion for rehearing and rehearing en banc, the original CAFC panel issued a new opinion intended to “clarify” the original:

In our [original] decision, we did not intend to cast any doubt upon our prior decisions indicating that in appropriate circumstances a combination of design elements itself may constitute a ‘point of novelty.’ Such a combination is a different concept than the overall appearance of a design which, as indicated, our cases have recognized cannot be a point of novelty.

Thus, the result:

  • A unique combination of known elements may be a “point of novelty” for design patent infringement analysis; but
  • The “overall appearance” of a design cannot serve as such a “point of novelty.”

As one of the attorneys of record pointed out to me in a post-decision conversation, this distinction does not make sense for this case because the Appellant never argued that the point of novelty was simply the “overall appearance.” Rather, the Applicant set forth eight constituent elements and also argued that the combination of those elements was a ninth point of novelty.

Judge Newman, joined by Judges Rader and Gajarsa would have heard the case in an en banc panel. In a dissenting opinion, those judges argue that the overall appearance of a design should be sufficient to constitute patentable novelty:

The patentability of a design is determined on statutory criteria, as for all patents. The protocol called "point of novelty" has often aided the analysis of the application of these criteria to designs, but it is not a different concept from patentability based on the invention — the design — as a whole, and has not replaced the statutory provisions. Contrary to the panel’s view, the overall appearance of a design can indeed be novel, and can indeed constitute the patentable novelty.

Documents:

Links:

  • Design Patent: Patently-O discussing the petition for rehearing
  • Design Patent: Patently-O discussing the CAFC original panel decision
  • Welch: Discussing the CAFC original panel decision I
  • Welch: Discussing the CAFC original panel decision II
  • Welch: Discussing the rehearing decision
  • Welch: Discussing the Nike Brief
  • Welch: Discussing the IDSA brief

In Lava Trading Dissent, Judge Mayer Laments de Novo Review

Patent, Patent Cases 2006,

AIPLATalk203Lava Trading v. Sonic Trading Management (Fed. Cir. 2006, 05–1177)

The majority overturned a lower court claim construction, but Judge Mayer dissented:

The decision today is yet another example of the unfortunate consequences of Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed. Cir. 1995) (en banc), Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448 (Fed. Cir. 1998) (en banc), and Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc), which cemented this court’s jurisprudence with respect to claim construction as being purely a matter of law subject to de novo review. Because claim construction is treated as a matter of law chimerically devoid of underlying factual determinations, there are no “facts” on the record to prevent parties from presenting claim construction one way in the trial court and in an entirely different way in this court. By not dismissing this case, we issue a decision based on an undeveloped record. We set ourselves up to have to decide claim construction again later, which could well differ from the ruling today. Furthermore, allowance of an appeal of the trial court’s perfunctory, offhand ruling from the bench, for all intents and purposes allows an interlocutory appeal of claim construction, which portends chaos in process.

Knorr-Bremse does not Preclude Inference of Reckless Behavior for Failure to Obtain Opinion

Patent, Patent Cases 2006

AIPLATalk060Golden Blount v. Robert H. Peterson Co. (Fed. Cir. 2006, 04–1609).  

Opinions of Counsel: This case holds that Knorr-Bremse does not prevent a court from finding that a defendant was at least reckless by obtaining an oral noninfringement opinion but failing to obtain a written opinion.  Rather, Knorr-Bremse only precludes an inference that an undisclosed written opinion would have been negative.

Damages: The defendant here was on the hook for contributory infringement — actual infringement occurred when customers assembled the fireplaces.  On damages, the CAFC partially reversed the lower court’s ruling.  The appellate panel found that lost-profit damages must be reduced by any products that were returned to the defendant without being opened by the customer — because in those cases the underlying direct infringement never occurred.

 Links:

Filed Briefs:

Phillips v. AWH: Certiorari Briefing Complete

Patent, Patent Cases 2006,

Phillips v. AWHPhillips v. AWH (on petition for certiorari)

Last week, Phillips posted its opposition to AWH’s petition for certiorari in this landmark case focused on the question of whether patent claim construction should be reviewed de novo on appeal. [Link].

In “short and pithy” paper, AWH has now filed its reply with, inter alia, these points:

  1. On three separate occasions, an en banc CAFC has ruled that claim construction is reviewed de novo. That issue is ripe for review.
  2. This is an extremely important issue — one that garnered 23 amici briefs at the CAFC level.  “The United States Patent and Trademark Office itself filed an amicus brief urging the Federal Circuit to apply some form of deferential review.”

The briefs may be circulated as early as next Tuesday.

Documents:

CAFC Refuses to Hear Case Export of Patented Processes

Patent

Union Carbide v. Shell Oil (Fed. Cir. 2006)

The CAFC has again decided that it is not ready to sort-out questions of extraterritorial application of the U.S. patent laws.  Here, the appellate body has rejected Shell’s bid for a rehearing en banc.

Dissenting from the opinion, Judges Lourie, Linn and Chief Judge Michel argued that the court should reconsider whether Section 271(f) of the Patent Act applied to process inventions.

Links

 

Phillips v. AWH: At the Supreme Court

Patent, ,

Phillips v. AWHPhillips v. AWH (on petition for certiorari)

AWH has petitioned the Supreme Court to with the broad question of whether patent claim construction should be reviewed de novo on appeal.

Question Presented: Whether the Federal Circuit is correct in holding that all aspects of a district court’s patent claim construction may be reviewed de novo on appeal.

AWH’s petition picks up where Judge Mayer and Newman’s dissent left off in the en banc Phillips decision. In their dissent, the judges focused their attention on the “futility [and] absurdity” of the de novo rule.  

Now more than ever I am convinced of the futility, indeed the absurdity, of this court’s persistence in adhering to the falsehood that claim construction is a matter of law devoid of any factual component. Because any attempt to fashion a coherent standard under this regime is pointless, as illustrated by our many failed attempts to do so, I dissent.

Indeed, many believe that the high reversal rate of claim construction is primarily due to the de novo standard.  To that effect, AWH’s petition does not mince words:

Left to its own devices, the Federal Circuit will continue to improperly devote the chief measure of its energy to rejudging the facts of patent claim constructions, rather than to fulfilling its purpose of bringing uniformity to patent law.

Now Phillips has posted his opposition.  Phillips argues that claim construction should be considered a matter of law and should continue to receive de novo review.

The construction of written instruments is one of those things that judges often do and are likely to do better than jurors unburdened by training in exegesis.  Similarly, the Federal Circuit is uniquely equipped to make such determinations on appeal.

The main thrust of the Phillips argument, however, is that the case is not ripe for review because the CAFC did not rule on the issue of de novo review.

Notes:

CAFC Written Description Jurisprudence: “OPAQUE”

Patent,

LizardTech v. Earth Resource Mapping (Fed. Cir. 2005) (on request for rehearing).

Plaintiff LizardTech lost its case at the Federal Circuit because its written description was lacking. 

The asserted patent was related to the use of discrete wavelet transform (DWT) to compress digital images. The specification provides an example method for creating a seamless DWT.  One of the claims included a claim to seamless DWT without including all of the limitations of the example method.

In its original decision, the CAFC stated the rule that a claim will not be invalidated under Section 112 for only disclosing a single embodiment.  However, the court went on to determine that the claim in question was improperly directed at “all seamless DWT’s” — a coverage not adequately supported by a single embodiment.

The CAFC has refused LizardTech’s request for rehearing, but has issued concurring and dissenting opinions.

Lourie, Michel, Newman: Disclosure containing only one embodiment will result in limiting the scope of the claims to cover only that embodiment.

[Claims] must be interepreted, in light of the written description, but not beyond it, because otherwise they would be interpreted to cover inventions or aspects of an invention that have not been disclosed. Claims are not necessarily limited to preferred embodiments, but, if there are no other embodiments, and no other disclosure, then they may be so limited. One does not receive entitlement to a period of exclusivity for what one has not disclosed to the public.

Rader, Gajarsa:

“This court’s written description jurisprudence has become opaque to the point of obscuring other areas of this court’s law.” 

BlackBerry Patent Settlement Found Unenforceable — Stay of Injunction Denied

Patent

PatentlyOImage009NTP v. Research-in-Motion

Judge Spencer of the Eastern District of Virginia has determined that the $450 million agreement between RIM and NTP that was announced Spring 2005 is not enforceable:

“The court finds the parties do not have a valid and enforceable settlement.”

RIM had asked the court to enforce the settlement that would allow it to end the patent lawsuit and escape from the threat of injunction. 

Settlement Agreement? In December 2004, the Federal Circuit released its opinion that pushed against the territorial bounds of patent law.  In that opinion, the Court of Appeals for the Federal Circuit (CAFC) found that U.S. patent law covers instances where infringing elements are located abroad — so long as the “control and beneficial use” of the infringing system is within U.S. territory.  Soon thereafter, RIM filed a motion for rehearing en banc that is still pending. 

The CAFC’s decision, strongly in favor of NTP, paved the way for a March 2005 “settlement” that reportedly included $450 million for NTP.  The original settlement announcement was based on a 1/2 page term-sheet reportedly signed by the parties.  As would be expected, 50 square inches of paper turned out to create a whole new level of disagreement between the parties who have been working through court mediation to flesh out the agreement.

Settlement Breakdown: In early June 2005, the settlement issue came to a head and the parties staked out their positions on paper before the CAFC.  However, that court declined to hear the issue until it being first decided by the district court.

STAY DENIED: In addition, the district court denied RIM’s motion to stay. (decision posted below).  In his opinion, Judge Spencer held that:

The Court recognizes the rights of a patent holder whose patents have been infringed. Indeed, the essence of patent protection is that a party legally deemed to have infringed one or more patents shall be liable to the patent holder for damages. Valid patents would be rendered meaningless if an infringing party were allowed to circumvent the patents’ enforcement by incessantly delaying and prolonging court proceedings which have already resulted in a finding of infringement.

The Court intends to comply with the Federal Circuit’s mandate and move this litigation forward so as to bring closure to this case on remand. Derailing these proceedings when a resolution is in sight would be ill-advised at best.

For these reasons, RIM’s Motion for Stay of Proceedings Pending Reexamination of NTP, Inc.’s Patents-in-Suit is hereby DENIED.

The Court’s opinion the filings from the Department of Justice, however, it appears to be clear that the Court’s next step will be to determine the bounds of any injunction.

Files:

Disclosed Subject Matter Only Dedicated to the Public When Specifically Identified as an Alternative to a Claim Limitation

Patent, ,

Pfizer v. Teva (Fed. Cir. 2005) (05–1331).

By S. Richard Carden

On appeal from the District Court’s grant of a preliminary injunction against generic manufacturers/distributors Ranbaxy and Teva, the Federal Circuit concurred with the lower court’s finding of likelihood of success and irreparable harm and thus affirmed the PI grant. Perhaps the most significant portion of the decision related to the Circuit’s clarification of dedication of subject matter to the public for the purposes of the doctrine of equivalents, as recently set forth in Johnson & Johnston Assocs. Inc. v. R.E. Serv. Co. (Fed. Cir. 2002) (en banc). (more…)

Phillips v. AWH: Case Petitioned to Supreme Court

Patent, Patent Cases 2005, ,

Phillips v. AWHPhillips v. AWH (on petition for certiorari)

AWH has petitioned the Supreme Court to take-up this landmark case with the broad question of whether patent claims should be reviewed de novo on appeal.

Question Presented: Whether the Federal Circuit is correct in holding that all aspects of a district court’s patent claim construction may be reviewed de novo on appeal.

This petition picks up where Judge Mayer and Newman’s dissent left off in the en banc Phillips decision. In their dissent, the judges focused their attention on the “futility [and] absurdity” of the de novo rule.  

Now more than ever I am convinced of the futility, indeed the absurdity, of this court’s persistence in adhering to the falsehood that claim construction is a matter of law devoid of any factual component. Because any attempt to fashion a coherent standard under this regime is pointless, as illustrated by our many failed attempts to do so, I dissent.

Indeed, many believe that the high reversal rate of claim construction is primarily due to the de novo standard.  To that effect, AWH’s petition does not mince words:

Left to its own devices, the Federal Circuit will continue to improperly devote the chief measure of its energy to rejudging the facts of patent claim constructions, rather than to fulfilling its purpose of bringing uniformity to patent law.

A Phillips reply brief will be due shortly.

Notes:

Supreme Court Shows More Interest In Pharmaceutical-Patent Antitrust Case

Patent, Patent Cases 2005,

FTC v. Schering-Plough (on Petition for Certiorari).

Odds are good that the Supreme Court will hear this high profile case involving antitrust issues surrounding the settlement of generic-pioneer patent cases.  On October 31, the Court asked the USDOJ to provide its stance on the case — a request that is often followed with a grant of certiorari.

It is a bit odd that the High Court asked for the Government’s amicus view on a case where the Government is a party.  Although the FTC is not directly under the control of the Administration, this has the appearance of giving antitrust regulators two bites at the apple. On the other hand, this may expose an interesting split between the FTC and DOJ.

In its petition for certiorari, the FTC presents two questions to the Court:

1. Whether an agreement between a pharmaceutical patent holder and a would-be generic competitor, in which the patent holder makes a substantial payment to the challenger for the purpose of delaying the challenger’s entry into the market, is an unreasonable restraint of trade.

2. Whether the court of appeals grossly misapplied the pertinent “substantial evidence” standard of review, by summarily rejecting the extensive factual findings of an expert federal agency regarding matters within its purview.

In its supporting brief, the FTC argues that agreements between competitors should not be per se lawful simply because they are within the “potential” reach of a patent claim.

Links:

  • FTC petition for Rehearing at the 11th Circuit
  • Schering 11th Circuit Decision.pdf
  • Patent at issue, No. 4,863,743
  • PubPat Amicus Brief to the 11th Circuit [pdf]

    • CAFC Denies RIM Rehearing (UPDATE)

    Patent, Patent Cases 2005

    RIM STOP TRADINGThe big patent news on Friday was that RIM’s petition for a rehearing en banc at the Court of Appeals for the Federal Circuit was denied.  This news was so hot that trading of RIMM on Wall Street was halted for three hours.  (Someone on the Street does not understand odds because the denial was entirely expected.)

    RIM has ninety days to file a petition for writ of certiorari with the Supreme Court and line-up any Amicus curiae.  NTP will then have thirty days to respond in opposition.  This time-line easily pushes the Court’s decision on whether to even hear the the case into 2006.  In all likelihood, the Court will decline — thus allowing the case to return to the district court to determine: (1) whether a the “term sheet” was an actual settlement; (2) whether an injunction should issue immediately; and/or (3) how new hearings/trial should proceed on the issues vacated by the August 2005 opinion [pdf]. (see UPDATE below).

    In a parallel process, the patents in suit are all undergoing reexamination at the PTO.  Each patent has been initially rejected in a first office action.  However, those initial rejections have yet to be made final.

     UPDATE: I received several comments on my implied conclusion that the district court would not take-on the case until after the Supreme Court came to a conclusion on the petition for cert:

    Love your blog. . . . The district court gets jurisdiction back as soon as the Fed Cir mandate issues. . . . The district court can thus act even while RIM is drafting a cert petition and the Supremes are reviewing it.  In most cases, a district court will move forward because the odds of cert are so low.  The district court can, however, stay the case pending Supreme Court review.  If I were NTP, I’d be in Judge Spencer’s face right now pushing for action on this case and telling him that the revised Fed Cir opinion makes Supreme Court review highly unlikely.  If I were RIM, I’d be asking for a stay based on the progress of the re-exams, and I’d be citing the Fed Cir’s stay of the MercExchange case.

     

    CAFC Finds Liability For Export of Catalyst Used in Patented Process Abroad

    Patent, Patent Cases 2005

    Patentlyo006Union Carbide v. Shell Oil (Fed. Cir. 2005).

    A jury found that Shell infringed Union Carbide’s patented process for producing Ethylene Oxide.  However, the court did not allow Union Carbide to collect damages for Shell’s foreign sales under 35 U.S.C. 271(f) because the statute is “not directed to process claims.”

    On appeal, the CAFC reversed the district court and reaffirmed the recent Eolas decision that 271(f) is directed to “every component of every form of invention” and that the statute is “not limited to physical machines.”

    Thus, the court found that Shell’s exportation of a catalyst used abroad to facilitate the patented process constituted infringement under the law. Remanded for a new determination of damages.

    Links: