Tag Archives: First to Invent

Beating the Deadline: Timing the Responses to Non-Final Office Actions

Patent

PatentlyO060

I took a sample of 6,600 published patent applications whose prosecution files each included an initial non-final office action rejection and a response to that action that was submitted sometime between January 1, 2008 – June 10, 2010.  Based on the dates of the office action and response, I created the histogram shown above. (Note, the histogram is corrected for due-date shifts caused by weekends and holidays).  The data is an improvement on what I presented in 2008. [Link]

As the chart show, patent applicant responses are extremely deadline driven. A typical non-final office action allows three-months to respond, but that deadline can be extended for up to three more months (for a fee).  The current extension fees are $130, $490, and $1,100 for one, two, and three month extensions respectively. That fee is cut in half for qualified “small entities.”  About 2/3 of applicants respond within the original three-month deadline. An additional legal reason to meet the original three-month deadline is that it preserves potential patent term adjustment (PTA) created by patent office delays. PTA is reduced by one-day for each day of applicant delay beyond the three month date.

Hitting the Deadline: More than 26% of the responses were filed on the exact day of the three month deadline. For applicants that missed that date, 70% filed their responses within four-days of a deadline.

Compact Prosecution: One problem with long delays is that information regarding the invention, the business needs, and the prior art, and the attorney-examiner relationship all become stale in the course of three months.  Although this staleness is difficult to quantify, I did look at patent grant rate as a function of the timing of responses. In my study, I found a clear and significant negative correlation between grant rate and delay in responding to the non-final office action.  I.e., longer delays are associated with a lower grant rate. (Here, grant rate is calculated as the number of patents issued divided by sum of the number of patents issued and applications abandoned).  The chart below groups applications according to the earliest deadline met in their first OA response and reports the grant rate for each group.

PatentlyO061

Satisfied With Delay: A delay in applicant response more-likely-than-not will delay the eventual issuance of the patent.  These figures show that most applicants are not troubled by that delay. On that note, I found that applicants that claim priority to a provisional application tend to have longer delays in responding to office actions. That is not surprising since the filing of the provisional already indicates that the applicant is comfortable with delay.  As might be expected, applications relating to Biotechnology and Organic Chemistry (TC 1600) tend to have a longer delay as well.

 

Bits and Bytes: Cybaris

Patent

William Mitchell’s new IP Journal “Cybaris” recently published its first issue. Each article is accopmanied by a videotaped interview and discussion with the author(s). Readers may also leave comments on the site.  The first issue includes:

  • A complete version the Matrix for Changing First-To-Invent by Brad Pedersen & Justin Woo that was originally discussed on Patently-O [Link]
  • Trying to Agree on Three Articles of Law: The Idea/Expression Dichotomy in Chinese Copyright Law by Stephen McIntyre [Link]
  • Buffering and the Reproduction Right: When is a Copy a Copy? by Steven Foley [Link]
  • Note: The Best of Intentions: Why the Proposed Changes to the Canadian Access to Medicines Regime Should Not Be Implemented by Carly L. Huth [Link]
  • Note: In Defense of TRIPs: It Only Seems Imperialistic by Anthony R. Noss [Link]
    Note: The Statutory Damages Regime of Copyright Law: The Non-Commercial User and Capitol Records, Inc v. Thomas-Rasset by Heather N. Kjos [Link]

Divisional of a Divisional: Avoid Terminal Disclaimers

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Boehringer Ingelheim International GMBH v. Barr Laboratories, Inc. (Fed. Cir. 2010) (denial of en banc rehearing)

In January 2010, the Federal Circuit expanded the scope of the safe-harbor created by 35 USC 121 against double patenting allegations. Namely, the court held that a divisional-of-a-divisional still qualifies for the safe harbor so long as the later-filed applications do not violate the Examiner’s original grouping suggestions.

Now, the court has denied generic drugmaker Mylan request for rehearing en banc. Mylan had presented two questions:

1.    Whether a divisional of a divisional patent application is a “result of a restriction requirement imposed on an original application, entitling a patentee to invoke 35 U.S.C. § 121’s safe harbor from invalidity due to double patenting, where the second divisional was filed voluntarily for strategic reasons and was not mandated by the original restriction requirement.”

2.    Whether a divisional application is “consonant” with a restriction requirement, entitling a patentee to invoke the safe harbor of 35 U.S.C. § 121, where the divisional disregards the lines drawn by the examiner in imposing the restriction requirement.

Judges Gajarsa and Dyk dissented from the en banc denial. In the dissent, Judge Gajarsa wrote:

Because the majority’s decision improperly expands the statutory safe-harbor provision of 35 U.S.C. § 121 beyond Congress’s intended scope, I respectfully dissent from the court’s denial of Mylan’s petition for rehearing en banc. While the Supreme Court has not construed § 121, the majority’s expansive opinion is inconsistent with our longstanding precedent, and will work a major change in our jurisprudence.

The purpose of § 121 is to prevent the inequity that resulted from an examiner’s improper restriction requirement (separating out supposedly patentably distinct inventions that were in fact the same or not patentably distinct), whereby a patentee’s compliance with an examiner’s incorrect restriction would result in the original application being used as a reference against the later divisional application and a rejection on double patenting grounds. See Pfizer, Inc. v. Teva Pharms. USA Inc., 518 F.3d 1353, 1361 (Fed. Cir. 2008); Studiengesellschaft Kohle mbH v. N. Petrochem. Co., 784 F.2d 351, 359 (Fed. Cir. 1986) (Newman, J., concurring). Thus, § 121 “effects a form of estoppel” against the PTO, “that shields the applicant from having to prove the correctness of the restriction requirement in order to preserve the validity of the second patent.” Studiengesellschaft, 784 F.2d at 361. In our past decisions, we have limited § 121 in accordance with its language and clear purpose to situations in which the patent applicant has been forced to divide his application by action of the PTO. We have interpreted the statute to include a requirement of consonance, requiring that the later application or applications follow the original examiner’s restriction requirement, and we have interpreted the statute to include a requirement that the later application or application be filed “as a result of” the original PTO restriction.

In addressing § 121, the majority opinion commits two legal errors. First, it significantly undermines this court’s “consonance” precedence by permitting a patentee to ignore the examiner’s demarcation of independent and distinct inventions in subsequent divisional applications. Second, it engages in an impermissible and expansive reading of § 121’s “as a result of” language. Either error in isolation would be worthy of en banc review; coupled together, the errors threaten to significantly broaden § 121’s safe-harbor provision in clear defiance of this court’s “strict test for application of § 121.” Geneva Pharms., Inc. v. GlaxoSmithKline PLC, 349 F.3d 1373, 1382 (Fed. Cir. 2003).

 

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Hearing Components, Inc. v. Shure, Inc., Appeal No. 09-1364 (Fed. Cir. 2010)

This case has three interesting issues: (1) the definiteness of “terms of degree” claim elements; (2) interpreting means-plus-function claim limitations; and (3) the standard for appellate review of a jury’s non-obviousness determination. In this decision, the resolution of each of these issues favors the patentee, Hearing Components.

Terms of Degree: The patents-in-suit all relate to hearing-aide elements. Claim 1 included a long-preamble with the statement that the device is configured to be “readily installed and replaced by a user.” The district court had difficultly drawing a boundary between devices that are readily installed and those that are not readily installed and therefore found the claim indefinite and invalid. On appeal, the Federal Circuit reversed.

In Datamize, the Federal Circuit held the claim term “aesthetically pleasing” to be indefinite. In the process, however, the court noted that these seemingly loose terms of degree will not be considered indefinite if the patentee “provides some standard for measuring that degree.” In the present case, the court found several hints as to the standard for “readily installed.” First, the patentee had argued that the readily limitation helped the claim avoid prior art – thus defining a category of items that were not readily installed. Second, the patent application discussed user installation “without tools.” The Federal Circuit held that this discussion suggested another way to measure “readily.” Based on these findings, the appellate panel rejected the indefiniteness holding because – in the words of Datamize – the specification “supplies some standard for measuring the scope of the phrase.”

Means-Plus-Function Claims: The patent claimed a “means … for disposably attaching” a duct of the hearing aide to a connector. The specification included several examples, but did not include the specific arrangement of the accused device. The jury found infringement, but the district court flipped that decision in a post-verdict order. On appeal, the Federal Circuit confirmed and reinstated the jury verdict of infringement.

Means-plus-function claims often appear to be broadly written, but are limited to specific structures described in the specification and equivalents to those structures. Thus, a means-plus-function element is infringed if the accused device includes a relevant structure that performs the same function as described in a way that is at least equivalent to one described in the specification.

Here, Federal Circuit held that the jury had permissibly found that the accused product’s “interference fit” was equivalent to the “screw threads or ball-and-socket attachment” disclosed in the application.

There was evidence that the inventors knew of the potential of using an interference fit attachment but chose not to disclose it in the specification. The defendant argued that evidence of prior knowledge should limit the scope of equivalents under a doctrine akin to estoppel. Instead, the Federal Circuit held that the “known interchangeability” weighs in favor of a finding of equivalence.

Reviewing a Non-Obviousness Determination: In John Deere, the Supreme Court divided the issue of obviousness into a series of factual inquiries leading to an ultimate conclusion of whether a patent is obvious. The ultimate question of obviousness is an issue of law reviewed de novo on appeal. However, a jury’s findings regarding the question’s many underlying factual predicates are reviewed for substantial evidence. This structure is normally ignored in a jury decision because the jury is typically not asked to explain its factual predicates. Rather most juries just answer the yes/no question: “Is the claim obvious?” When unpacking the decision on appeal, the Federal Circuit gives the jury the benefit-of-the-doubt by looking for any way that the evidence presented can support the jury’s conclusion. Thus, the question on appeal boils down to whether the factual evidence presented could be sufficient to support the legal conclusion on obviousness.

Federal Circuit Confirms that Patents Must Meet Both the Written Description and Enablement Requirements of Section 112.

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Ariad Pharmaceuticals, Inc. v. Eli Lilly and Co. (Fed. Cir. 2010) (En Banc Decision).

In a 9-2 decision, an en banc Federal Circuit has confirmed that 35 USC § 112 ¶1 includes separate written description and enablement requirements. “If Congress had intended enablement to be the sole description requirement of § 112, first paragraph, the statute would have been written differently.” The court also clearly confirmed the prospect that originally filed claims can violate the written description requirement:

Although many original claims will satisfy the written description requirement, certain claims may not. For example, a generic claim may define the boundaries of a vast genus of chemical compounds, and yet the question may still remain whether the specification, including original claim language, demonstrates that the applicant has invented species sufficient to support a claim to a genus. The problem is especially acute with genus claims that use functional language to define the boundaries of a claimed genus. In such a case, the functional claim may simply claim a desired result, and may do so without describing species that achieve that result. But the specification must demonstrate that the applicant has made a generic invention that achieves the claimed result and do so by showing that the applicant has invented species sufficient to support a claim to the functionally-defined genus.

Possession vs Disclosure: The court did step away from “possession” as the hallmark of the written description requirement. Rather, the court wrote that “the hallmark of written description is disclosure. . . . [T]he test requires an objective inquiry into the four corners of the specification from the perspective of a person of ordinary skill in the art. Based on that inquiry, the specification must describe an invention understandable to that skilled artisan and show that the inventor actually invented the invention claimed.”

General Principles: The court presented “a few broad principles that hold true across all cases”: “the written description requirement does not demand either examples or an actual reduction to practice”; however “actual ‘possession’ or reduction to practice outside of the specification is not enough; and a “description that merely renders the invention obvious does not satisfy the requirement.”

Basic Research – Tough Luck: The court recognized that the written description requirement makes it more difficult to patent “basic research” that has not yet been fully reduced to a practical implementation. The court’s reaction to that problem was tough luck. “That is no failure of the law’s interpretation, but its intention. Patents are not awarded for academic theories, no matter how groundbreaking or necessary to the later patentable inventions of others.”

That research hypotheses do not qualify for patent protection possibly results in some loss of incentive, although Ariad presents no evidence of any discernable impact on the pace of innovation or the number of patents obtained by universities. But claims to research plans also impose costs on downstream research, discouraging later invention. The goal is to get the right balance, and the written description doctrine does so by giving the incentive to actual invention and not “attempt[s] to preempt the future before it has arrived.” Fiers, 984 F.2d at 1171.

Holding: For the foregoing reasons, we hold that the asserted claims of the ‘516 patent are invalid for lack of written description, and we do not address the other validity issues that were before the panel. We also reinstate Part II of the panel decision reported at 560 F.3d 1366 (Fed. Cir. 2009), affirming the district court’s finding of no inequitable conduct. The majority opinion was written by Judge LOURIE and joined by Chief Judge MICHEL and Circuit Judges NEWMAN, MAYER, BRYSON, GAJARSA, DYK, PROST, and MOORE. Judges NEWMAN and GAJARSA filed concurring opinions.

Judges RADER and LINN each filed opinions in dissent. [I will write more on this later]

Damages: Federal Circuit Again Demands More Substance from Damages Experts

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PatentLawPic923ResQNet.com and Jeffrey Kaplan v. Lansa, Inc. (Fed. Cir. 2010)

The district court held that one of ResQNet’s patents was infringed and awarded $500k in past damages based on a 12.5% royalty rate. The court denied the patentee’s requested permanent injunction but instead ordered an ongoing license at the 12.5% royalty rate. The court also awarded sanctions against ResQNet’s counsel for failing to withdraw patents from suit that were clearly not infringed.

On appeal, the Federal Circuit took issue with the damages calculation — holding that the lower court had “relied on speculative and unreliable evidence divorced from proof of economic harm linked to the claimed invention.” 

This appellate decision should be seen as an extension of the Federal Circuit’s 2009 Lucent v. Gateway decision.  The issue of sufficiency of expert testimony on damages has been brewing for some time. I remember sitting near Judge Rader (one of the authors of this opinion) and both of us listening to Northern District of California Judge Ron Whyte refer to economic damages experts as the “most intellectually dishonest witnesses” that testify in his court.

Hypothesize Rather than Speculate: The statutory minimum damages for patent infringement is a “reasonable royalty.” That calculation typically involves a “hypothetical negotiation” in an attempt to calculate the rate at which the patentee would have licensed the patent to the infringer prior to the infringement.  Although the hypothetical negotiation is always involves guesswork, here the Federal Circuit reiterated the koan that the guesses must be based on evidence: “a reasonable royalty analysis requires a court to hypothesize, not to speculate.” Everyone understands that the arguments must have some evidentiary basis. Here, the real question was the type of evidence that can be applicable.  In particular, the appellate court held that the only relevant evidence is evidence related to “compensation for the economic harm caused by infringement of the claimed invention.”

Past Royalty Rate Must be Tied to Invention: The first problem with ResQNet’s evidence was that it presented past ResQNet license rates that were not bare patent licenses.  Addressing a similar issue, the CAFC wrote in its 2009 Lucent decision that a reasonable royalty damage award “cannot stand solely on evidence which amounts to little more than a recitation of royalty numbers, one of which is arguably in the ball-park of the jury’s award, particularly when it is doubtful that the technology of those license agreements is in any way similar to the technology being litigated here.”  Lucent.  According to the appellate panel, ResQNet’s expert witness Dr. Jesse David “used licenses with no relationship to the claimed invention to drive the royalty rate up to unjustified double-digit levels.”  The court indicated that experts need even more credible justification when the proposed royalty rate is much higher than might be expected.

Although the discredited prior licenses used by Dr. David were ResQNet licenses, those licenses were directed to the software code and re-branding rights but apparently did not specifically mention the patent number in suit and the evidence did not tie the licenses directly to the claimed invention. The appellate panel rejected these licenses as irrelevant to estimating royalty rate for the infringed patent: “In simple terms, the ’075 patent deals with a method of communicating between host computers and remote terminals—not training, marketing, and customer support services. The re-bundling licenses simply have no place in this case.”

The defendant Lansa did not offer any expert testimony on damages to counter Dr. David.  However, that failure does not remove the patentee’s burden to properly prove its damages. “As a matter of simple procedure, Lansa had no obligation to rebut until ResQNet met its burden with reliable and sufficient evidence.”

Judge Newman writing in dissent argued that the appellate panel over-stepped its bounds:

This is not a case of constructing, and applying, a royalty rate from totally unrelated content; it is simply a case of determining the evidentiary value of the infringed subject matter by looking at the various licenses involving that subject matter, and allocating their proportional value, with the assistance of undisputed expert testimony.

In the district court, ResQNet’s damages expert Dr. David, a qualified economist with experience in the field, followed the traditional application of the Georgia-Pacific factors, analyzing the impact of all of these factors in an extensive Expert Report and in testimony at trial. He was subject to examination and cross-examination in the district court, and the district court provided a full and reasoned analysis of the evidence. No flaw in this reasoning has been assigned by my colleagues, who, instead, create a new rule whereby no licenses involving the patented technology can be considered, in determining the value of the infringement, if the patents themselves are not directly licensed or if the licenses include subject matter in addition to that which was infringed by the defendant here. In this case, the added subject matter was usually the software code that implements the patented method, as the district court recognized, and whose contribution to the value of the license was evaluated by the damages expert and discussed by the court. My colleagues’ ruling today that none of that information is relevant to the assessment of damages is unprecedented, and incorrect.

Judge Newman was a member of the Lucent panel and argues that the majority decision here is “distorting the principles” of that case.

Ongoing damages: The appellate panel did not consider the issue of ongoing damages (compulsory license) because that question was not appealed.

Sanctions: The appellate panel did reverse the imposition of sanctions on Jeffrey Kaplan’s firm. In its decision, the court noted (i) the untimeliness of the motion for sanctions; (2) Kaplan’s prompt withdrawal of one of the three patents-in-suit; and (3) the actual “litigation substance” concerning the patent that was only withdrawn at the last minute.

Book Review: Patent Ethics: Volume I Prosecution

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[This post is an old-one, I’ve moved it to the front because Amazon now has the books in stock.]

Patent Ethics: ProsecutionHricikEthics.jpg

by David Hricik & Mercedes Meyer

ISBN: 0195338359

$225 from Amazon

Professor David Hricik is the country’s leading expert on patent law ethics. Oxford University Press recently published his (and co-author Mercedes Meyer’s) volume on patent prosecution ethics. This is a book that includes specific guidance for both patent attorneys and patent agents. It should be within the reach of every patent prosecutor. Topics include: guidance on client engagement and dis-engagement; the duty of loyalty to the client (perhaps as opposed to the inventor); avoiding conflicts of interest; specific areas of competency in patent prosecution; avoiding pitfalls created by the duty of candor; and issues arising from attorneys who practice both prosecution with litigation. The book also includes two very helpful appendices. The first appendix is an annotated version of the PTO ethics rules where the authors discuss nuances of each rule. The second is a set of sample forms; checklists; and client-memos — a version of which should be used by every patent practitioner in handling client relations.

I suspect that this book will quickly become the leading authority on patent prosecution ethics. Although not at all foolproof, attorneys and agents who rely on the book for guidance will have some cover from charges of malpractice or inequitable conduct.

My only problem with the book is its price: $255! Once you add tax and shipping, the cost approaches $1 per page. Of course, that price would get you only about a 1/2 hour of Professor Hricik’s time. This book is the first volume in a two-part series. The second volume will be published in 2010 and will focus on patent litigation ethics.

Enforcing Contracts between Joint Owners: WARF v. Xenon

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Wisconsin Alumni Research Foundation (WARF) v. Xenon Pharma, Appeal No. 08-1351 (7th Cir. 2010).

WARF and Xenon jointly filed for patent protection for a cholesterol lowering enzyme known as Stearoyl CoA Desaturase (SCD). Warf also granted Xenon rights as an exclusive licensee and Xenon agreed to pay royalties for sales or sublicense fees. Xenon then sublicensed its rights to Novartis but did not pay royalties to WARF. Xenon's argument is based on the law of concurrent patent ownership. Generally, a patent co-owner is not required to share licensing revenue with other co-owners. The district court rejected that argument here — finding that the contract between WARF and Xenon is controlling over the patent law default rule. At trial, a jury awarded WARF one-million-dollars in royalties. That award was reduced then by the judge to $300,000.

The Seventh Circuit has now affirmed the lower court ruling that Xenon breached its license agreement by granting a sublicense without paying WARF its share.

35 U.S.C. 262 makes clear that each Joint owner of a patent right may make use of the rights "without the consent of and without accounting to the other owners." However, §262 has a major caveat in that it only applies "in the absence of any agreement to the contrary." Picking up on that caveat, the Seventh Circuit made clear that the "statutory default rule therefore controls unless there is an agreement to the contrary." The appellate panel went on to confirm that the WARF/Xenon agreement is certainly an "agreement to the contrary" despite the fact that it does not include a specific and explicit revocation of § 262 rights.

The bargained-for exchange between the parties provided that the Foundation would forego its right to separately license the patent in exchange for receiving a share of the profits from Xenon's commercialization of the technology—either directly or via a sublicense to a third party. Xenon received a significant benefit from the agreement—the exclusive right to exploit the technology protected by the joint patent application. Xenon cannot avoid paying royalties or sublicense fees to the Foundation simply by labeling the Novartis transaction a "license" rather than a "sublicense."

Quiet Title: Xenon also filed for its own patents on PPA compounds used to suppress SCD levels. WARF claimed ownership rights in the PPA because one of its scientists had contributed to the project and sued here to quiet title and also sued for conversion. On appeal, the court sided with WARF — finding that the WARF scientist's assignment of rights to Xenon was void because the scientist has already assigned all interest in future inventions to WARF.

Seventh Circuit: WARF originally appealed its case to the Federal Circuit. However, the Federal Circuit transferred the case to the Seventh Circuit based on a lack of subject matter jurisdiction. In a non-precedential opinion, the court held that the dispute did not "arise under the patent laws." [Link] An interesting aspect of that decision was that the court's statement that the Bayh-Dole Act (35 U.S.C. §§ 200-212) is not "patent law" when considering the question of appellate jurisdiction. The Federal Circuit refused to take the jurisdiction issue en banc. Judge Rader penned the following dissent from the en banc denial:

In an extremely short per curiam opinion with far too little explanation, the panel left the impression that it was giving away this court's jurisdiction over a broad swath of claims potentially arising from the Bayh-Dole Act, 35 U.S.C. §§ 200-212. While non-precedential, the panel's opinion nonetheless unnecessarily suggests that this court's jurisdiction to review these cases is limited. I respectfully dissent from this court's denial of rehearing en banc.

The panel concluded, albeit without much analysis, that WARF's complaint did not allege that the Bayh-Dole Act creates a cause of action. Thus it was entirely unnecessary for the panel to opine as to whether the Bayh-Dole Act is a "patent law" or not. And indeed, the Bayh-Dole Act, in my view, is most certainly a patent law. While the panel dismissed the notion that the Bayh-Dole Act's "mere inclusion" in Title 35 does not make it a "patent law," it seems to me that this is actually a pretty good indicator. After all, Title 35 is itself entitled "Patents," and Chapter 18, which encompasses only §§ 200-212, is called "Patent Rights in Inventions Made with Federal Assistance." Also, the language within some of the sections of the Bayh-Dole Act suggests its provenance as a patent law. For example, 35 U.S.C. § 201(d) defines "invention" as "any invention or discovery which is or may be patentable…." Section 201(e) explains that a "subject invention" is an invention conceived of or first reduced to practice by a contractor. "Conception" and "reduction to practice" are familiar patent law terms of art. Also, § 200 states that the Act intends "to use the patent system to promote the utilization of inventions arising from federally supported research or development…." The Bayh-Dole Act is, "at its heart," a patent law, albeit a patent law that employs some government contract rules to facilitate its patent-related policy objectives.

Although this court's panel opinion did not mention it, the reason that the "improvements" clause in this case does not require an infringement analysis is that the WARF/Xenon agreement features no issued patents, just patent applications. Thus, no court need perform a true infringement analysis. See GAF Building Materials Corp. v. Elk Corp., 90 F.3d 479, 483 (Fed.Cir.1996) (no declaratory judgment jurisdiction for infringement/invalidity of a design patent that had not issued when suit was filed; without an issued patent, there can be no infringement and thus no Article III controversy). Unlike GAF, however, this case features an undeniable controversy between the parties. To resolve this dispute, some court will have to compare the claims of the pending patent applications of the WARF/Xenon agreement with the alleged "improvements," and the contract's use of patent infringement parlance to define this term will necessitate some sort of patent analysis, starting with construction of the pending claims. Thus, this is a patent dispute for still another reason.

David Kappos and The Impact of KSR – a unique opportunity for our profession

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Guest Post by Paul Cole, Visiting Professor, Intellectual Property Law, Bournemouth University, UK

On Tuesday 24 November, David Kappos made a posting on the Director’s Forum including the following statement:

Some have suggested that the Office is determining obviousness in a way that stifles innovation by refusing patents for truly inventive subject matter. They’ve asked us to provide examples of non-obvious claims in view of KSR. Such examples would serve as a complement to the examples of obvious claims already in the guidelines.

David Kappos gave a presentation at the AIPLA Annual Meeting in Washington on October, and in a question and answer session that followed there were three questions which concerned KSR, more than any other topic. The two questioners who preceded me expressed dissatisfaction with seemingly unjust and arbitrary rejections for lack of inventive step. I asked whether the US examination guidelines on inventive step could be brought into line with those of the EPO, where positive and negative examples are carefully balanced, and the suggestion created a burst of applause from the audience.

More detained comments on the suggestion are found in a paper on KSR that was published in the John Marshall Review of Intellectual Property Law in 2008[1]. For convenience of reference, the final section is set out here:

The USPTO has been accused of having become significantly less applicant-friendly following the KSR decision. This may reflect concerns about “patent quality” and is reflected in the Guidelines given to examiners. A big difference is noticeable between the EPO Examination Guidelines and those of the USPTO.

The EPO Examination Guidelines at Part C Chapter IV give examples relating to the requirement of inventive step. Considerable care has been taken to balance these examples. Examples illustrating the application of known measures in an obvious way and in which inventive step can be ruled out are balanced by further examples showing the application of known measures in a non–obvious way and in which an inventive step is therefore to be recognized. An example of an obvious and consequently non-inventive combination of features is balanced by an example of a non-obvious and consequently inventive combination of features. Examples of obvious and consequently non-inventive selection are balanced by examples of non-obvious and consequently inventive selection. The single example relating to overcoming a technical prejudice shows a situation where the application should be allowed, not refused. A reader of these Guidelines is made aware that although many applications are open to objection, there are many others that cover meritorious inventions and should be allowed.

When the USPTO issued its post-KSR Guidelines, from the standpoint of a prosecution attorney they made depressing reading. For example, the first heading which refers to combining prior art elements according to known methods to yield predictable results gives two examples, one of which is Andersons-Black Rock, Inc. v. Pavement Salvage Co. and the other of which is Ruiz v SAB Chance Co. in both of which obviousness was established. There is no balancing example in which inventive character was established. There follow five other headings illustrated by examples, each and every one of which shows the claimed subject matter to be obvious. The final heading concerns the TSM test which is not illustrated by any example. Under the heading “Consideration of Applicants Rebuttal Evidence” there are cursory indications that an applicant might have something relevant to say in reply, and that, for example, they might argue that the claimed elements in combination do not merely perform the function that each element performs separately. Might it not have been a good idea to inform the Examining Corps that if an applicant can demonstrate a new and unexpected result, this is strong prima facie evidence of inventive step, that this fact is supported by several opinions of the U.S. Supreme Court and that where such evidence is available an applicant should unless there are compelling reasons to the contrary expect a grant decision to follow? Experience in the EPO is that where an applicant can demonstrate a credible technical problem that he has solved, he will almost always be granted a patent and that although other objections, e.g. “one–way-street” or “bonus effect” are available, circumstances where such objections succeed are rare, as acknowledged by the U.K. High Court in Haberman.

Instructions to examiners are of general importance to the public because they are the main tool used during examination and the important event for most applicants is grant or refusal by the patent office, litigation of patents (even in the U.S.) being uncommon. Instructions are even more important for examiners who are trainees and those who have only recently acquired signatory authority because they are likely to rely chiefly on those instructions and to take some time to achieve a deep understanding of case law. It is important to teach examiners when to make objections and the appropriate grounds for doing so, but is it not equally important to teach them when applications should be allowed and to show them examples of patents whose validity has been upheld, as the EPO does? Quality patent examination is not just a matter of ensuring that applications lacking merit are reliably refused but also of ensuring that meritorious applications are reliably granted.

It now seems that there is at least a chance that the suggestion that I and apparently others have made will be acted on, and that the possibility is under active consideration in the USPTO. Examples of decisions on new function or result which are contained in my paper include the nineteenth century Supreme Court cases Winans v Denmead and Washburn & Moen Manufacturing, Co. v. Beat’Em All Barbed-Wire Co, these decisions being selected on the basis of their instructive character and accessibility to the widest possible range of readers.

For the most to be made of this opportunity, we as students and users of the patent system can help by suggesting additional positive decisions which it would be good for the USPTO to include in the revised inventive step Guidelines. Hopefully readers will respond with references to good Board of Appeals, District Court and CAFC cases, and I look forward to reviewing a large number of hopefully constructive suggestions posted here in response.

[1] Paul Cole, KSR and Standards of Inventive Step: A European View, 8 J. MARSHALL REV. INTELL. PROP. L. 14 (2008)., downloadable from /media/docs/2011/06/Cole.pdf.

Federal Circuit Affirms EDTex Ruling that Iovate’s Muscle Building Patents are Invalid

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Iovate & University of Florida Research Foundation v. Bio-Engineered Supplements & Nutrition 200911201103.jpg (BSN) (Fed. Cir. 2009) (Download 09-1018)

Iovate is the exclusive licensee of UF's patented method for "enhancing muscle performance or recovery from fatigue." Pat. No. 6,100,287. The method includes the single step of administering a coposition that contains a ketoacid and either a cationic or dibasic amino acid. Eschewing their home-state courts, the patentee filed suit in the Eastern District of Texas — alleging that BSN was selling infringing supplements.

On summary judgment, district court judge Ron Clark held the patent invalid as anticipated under 35 U.S.C. 102(b). The most relevant prior art was a series of advertisements found in Flex Magazine.

Each ad includes a list of ingredients, directions for administering the dietary supplement orally to humans, and marketing claims and testimonials from bodybuilders extolling the virtues of the product. . . . The ad also describes how the product is made, including the four steps used to isolate the protein components from milk whey; lists a price of $24.99; states that the product is available at GNC and other health food stores or by phone; instructs the user on the amount to take; and offers a manufacturer’s rebate of $5.00 for mailing in a coupon with proof of purchase before July 31, 1996.

Judge Clark ruled that the advertising served as proof that the invention public use and on sale under § 102(b) based on the fact that the ads "show an actual product and state that it is available for purchase in health food stores, gyms, or by catalog." The district court also held that the ads explicitly disclose "all of the limitations of the asserted claims, including each of the claimed chemical components as well as the stated function of oral administration to a human to speed muscle recovery."

Under § 102(b) a patent is invalid if "the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States."

On appeal, the Federal Circuit affirmed, but narrowed its grounds to focus only on the prior art as a "printed publication." Writing in a concurring opinion, Judge Mayer indicated that he would have found that the ads place the products "on sale" as well.

Iovate raised two arguments regarding the prior art. First, the patentee argued that the ads did not disclose each element in the claims because the preamble included the goal of "enhancing muscle performance" and while the ad merely touted promotion of "muscle synthesis and growth." The appellate panel not only rejected that argument, but also found that it "borders on the frivolous" since the specification and Iovate's briefs at the district court suggested that muscle growth was a proxy for enhancing muscle performance.

Iovate also argued that the ad was not sufficiently enabling as prior art. In rejecting that suggestion, the appellate panel held that "all one of ordinary skill in the art would need to do to practice an embodiment of the invention is to mix together the known ingredients listed in the ad and administer the composition as taught by the ad."

Affirmed.

This case leave open the question of when an advertisement would be evidence of public use or on sale.

Bilski v. Kappos: Supreme Court Arguments

Patent, , , , ,

Bilski v. Kappos (Supreme Court 2009) (oral arguments)

The transcript from the hour-long oral arguments are available online here. The following is the five-minute version of the questions and statements that I found most interesting. They are a bit out-of-order.

 

JUSTICE SCALIA: Well, if the government says that the — that the term on which it hangs its hat is the term useful arts and that that meant, originally, and still means manufacturing arts, arts dealing with workmen, with — you know, inventors, like Lorenzo Jones, not — not somebody who writes a book on how to win friends and influence people. What is wrong with [the] analysis, that …”useful arts” … always was thought to deal with machines and inventions?

JUSTICE BREYER: You know, I have a great, wonderful, really original method of teaching antitrust law, and it kept 80 percent of the students awake. … And I could probably have reduced it to a set of steps and other teachers could have followed it. That you are going to say is patentable, too?

JUSTICE SCALIA: . . . Let’s take training horses. Don’t you think that — that some people, horse whisperers or others, had some, you know, some insights into the best way to train horses? And that should have been patentable on your theory.

JUSTICE SOTOMAYOR: So how do we limit it to something that is reasonable? Meaning, if we don’t limit it to inventions or to technology, as some amici have, or to some tie or tether, borrowing the Solicitor General’s phraseology, to the sciences, to the useful arts, then why not patent the method of speed dating?

JUSTICE SOTOMAYOR: But a patent limits the free flow of information. It requires licensing fees and other steps, legal steps. So you can’t argue that your definition is improving the free flow of information.

 

MR. JAKES: . . . I think that we should go back to the first principles that were enunciated in Diehr and other cases, that abstract ideas per se are not patentable. That’s my position, and what I would advocate in this case and any case…

MR. STEWART: Well, I think the Court could say — could do essentially what was done in Benson and Flook, namely acknowledge that there had never been a case up to this point in which a process had been held patent eligible that didn’t involve a machine or a transformation. It could leave open the possibility that some new and as yet unforeseen technology could necessitate the creation of an exception.

 

MR. JAKES: [L]ooking at what are useful arts, it does exclude some things. It does exclude the fine arts. Speaking, literature, poems, I think we all agree that those are not included, and there are other things as well. For example, a corporation, a human being, these are things that are not covered by the statutory categories. . . . Now, the patent on the data, that’s another category that’s not included in the subject matter of those four categories. The data itself is not patentable, but if it is a series of steps, it should be eligible as long as it meets the other statutory requirements as a process.

 

CHIEF JUSTICE ROBERTS: Well, but your Claim 1 it seems to me is classic commodity hedging that has been going on for centuries.

MR. JAKES: Your Honor, if that were true, then we should run afoul of the obviousness provision under section 103.

 

JUSTICE BREYER: There are actually four things in the patent law which everyone accepts. There are two that are plus and two that are minus. And the two that are plus is by giving people a monopoly, you get them to produce more. As you said, you get them to disclose. The two minuses are they charge a higher price, so people use the product less; and moreover, the act of getting permissions and having to get permission can really slow things down and destroy advance. So there is a balance. In the nineteenth century, they made it one way with respect to machines. Now you’re telling us: Make it today in respect to information. And if you ask me as a person how to make that balance in respect to information, if I am honest, I have to tell you: I don’t know. And I don’t know whether across the board or in this area or that area patent protection will do no harm or more harm than good.

 

MR. STEWART: And you know, Justice Scalia, you mentioned how to win friends and influence people. I think at a certain level of generality you could describe both Dale Carnegie and Alexander Graham Bell as people who devised methods of communicating more effectively. The reason that Bell’s method was patentable was that it operated in the realm of the physical. Bell had devised a process implemented through machines by which sound was transformed into electronic current. The current was then transmitted over a distance and transformed back into sound. Innovations as to new techniques of public speaking, new techniques of negotiations, techniques that go to the substance of what is said may be innovative. They may be valuable. They are not patent eligible because they don’t deal in the realm of the physical —

 

JUSTICE SOTOMAYOR: How about if we say something as simple as patent law doesn’t cover business matters

MR. STEWART: I think that would be incorrect, and it would create problems of its own. . . . So to say that business methods were ruled out would itself be a fairly sweeping holding.

JUSTICE SCALIA: Also you could say business methods apart from machines are not patentable. How about that?

MR. STEWART: If the Court said that in the limited area of business methods, if there is no machine or transformation there is no patent eligibility —

 

CHIEF JUSTICE ROBERTS: Mr. Stewart, I thought I understood your argument up until the very last footnote in your brief. And you say this is not –simply the method isn’t patentable because it doesn’t involve a machine. But then you say but it might be if you use a computer to identify the parties that you are setting a price between and if you used a microprocessor to calculate the price. That’s like saying if you use a typewriter to type out the — the process then it is patentable. . . . that takes away everything that you spent 53 pages establishing. . . . [I]f you look at your footnote, that involves the most tangential and insignificant use of a machine. And yet you say that might be enough to take something from patentability to not patentable.

MR. STEWART: And all we’ve said is that it might be enough; that is, hard questions will arise down the road as to where do you draw the line, to what extent must the machine or the transformation be central —

CHIEF JUSTICE ROBERTS: So you think it’s a hard question. If you develop a process that says look to the historical averages of oil consumption over a certain period and divide it by 2, that process would not be patentable. But if you say use a calculator, then it — then it is?

MR. STEWART: I think if it’s simply using a calculator for its preexisting functionality to crunch numbers, very likely that would not be enough. But what we see in some analogous areas is that the computer will be programmed with new software, it will be given functionality it didn’t have before in order to allow it to perform a series of calculations, and that gets closer to the line. . . . I guess the point I’m trying to make is simply that we don’t want the Court, for instance, in the area of software innovations or medical diagnostic techniques to be trying to use this case as the vehicle for identifying the circumstances in which innovations of that sort would and would not be patent eligible, because the case really doesn’t present any — any question regarding those technologies.

 

JUSTICE KENNEDY: How would you come out in the State Street case today, if all of the arguments were made under your test?

MR. STEWART: Well, under our test, we would come out the same way because the computer would be a machine. The only question would be whether the programming of the computer with new software caused it to be a patentable different machine from the one that existed previously.

 

JUSTICE STEVENS: It’s not on a computer, which the only difference from the old computer is it’s using a new program. You can’t say that’s a new machine.

MR. STEWART: [The] PTO agrees … that programming a computer by means of software to produce — to perform new functions can create a novel —

JUSTICE BREYER: But then all we do is every example that I just gave, that I thought were examples that certainly would not be patented, you simply patent them. All you do is just have a set of instructions for saying how to set a computer to do it. Anyone can do that. Now, it’s a machine.

MR. STEWART: … we recognize that there are difficult problems out there in terms of patentability of software innovations and medical diagnostics.

JUSTICE KENNEDY: You thought we — you thought we would mess it up.

MR. STEWART: We didn’t think the Court would mess it up. We thought that this case would provide an unsuitable vehicle for resolving the hard questions because the case doesn’t involve computer software or medical diagnostic techniques, and therefore, we thought the Court would arrive at the position that I think, at least some members are feeling that you have arrived at, that you will decide this case, and most of the hard questions remain unresolved.

Challenging the Constitutionality of Gene Patents: Ass’n for Medical Pathology v. USPTO

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Association for Medical Pathology & ACLU v. USPTO & Myriad, 09-cv-4515 (S.D.N.Y. 2009)

Earlier this year, a group of organizations and individuals filed suit against the USPTO, Myriad, and individual directors of the University of Utah Research Foundation (ex parte Young action) demanding that the breast cancer gene patents (BRCA1 & BRCA2) be found invalid or unenforceable and that the PTO’s policies and practices with respect to genetic patents be declared unconstitutional. The federal lawsuit argues (1) that the genes are not patentable because they are “products of nature” and (2) that the patentee’s use of patent rights to limit scientific research on the genes violates constitutional First Amendment protections. The defendants moved to dismiss based on various standing and jurisdictional issues. In an 85 page opinion, Southern District of New York Judge Robert Sweet has denied all of the defendants’ motions to dismiss.

Judge Sweet recognized this case as important:

This action is unique in the identity of the parties, the scope and significance of the issues presented, and the consequence of the remedy sought. . . . The challenges to the patents-in-suit raise questions of difficult legal dimensions concerning constitutional protections over the information that serves as our genetic identities and the need to adopt policies that promote scientific innovation in biomedical research.

Jurisdiction & Standing to Sue the USPTO: The court found that the overarching statutory scheme of the Patent Act did not preempt the court’s jurisdiction over the PTO in this case since the Patent Act does not “provide a remedy for persons who complain about the constitutionality of patents issued by the USPTO and/or the policies and practices of the USPTO. . . . The novel circumstances presented by this action against the USPTO, the absence of any remedy provided in the Patent Act, and the important constitutional rights the Plaintiffs seek to vindicate establish subject matter jurisdiction over Plaintiffs’ claim against the USPTO.”

The court also found that the plaintiffs have standing to sue the USPTO for their Constitutional grievances; declaratory judgment jurisdiction over Myriad and the Directors, and personal jurisdiction over the Directors as representatives of the State of Utah.

In the final few pages, Judge Sweet outlined plaintiffs’ case against the USPTO:

In this case, the Plaintiffs have pled sufficient factual allegations to satisfy the standard set forth in Iqbal. The Complaint alleges the existence of a specific, written policy for the patenting of genes and the parameters of the policy. . . . The Complaint further alleges that the information encoded in the BRCA1/2 genetic sequences, rather than being the result of an inventive process, exists in nature. . . . Based on these factual allegations, the Plaintiffs assert that the patents-in-suit grant Myriad ownership rights over products of nature, laws of nature, natural phenomena, abstract ideas, and basic human knowledge and thought in violation of the First Amendment’s protections over freedom of thought. In addition, the Plaintiffs assert that Myriad’s ownership of correlations between certain BRCAl/2 mutations and an increased risk of breast and/or ovarian cancer has inhibited further research on BRCA1/2 as well as genes that interact with BRCA1/2. As a result, the patents-in-suit are alleged to violate Article I, section 8, clause 8 of the Constitution which directs Congress to “promote the Progress of Science and useful Arts . . . .”

The facts alleged in the Complaint are plausible, specific, and form a sufficient basis for Plaintiff’s legal arguments. Consequently, the pleading requirements as set forth in Iqbal are satisfied.

The next decision in the case is expected in January based on the Plaintiffs’ motions for summary judgment.

MTD decision.pdf

Expanding First Action Interview Pilot Program

Patent

“Washington — The Commerce Department’s United States Patent and Trademark Office (USPTO) today announced that it is expanding its First Action Interview Pilot Program in which an applicant is entitled to an interview with the patent examiner prior to the first office action on the merits in a new utility application. The program will expand to additional technology areas for a six-month period beginning on October 1, 2009. . . .

 . . . [The] patent process benefits when interaction between the applicant and the examiner are enhanced at the beginning of examination because patentability issues can be resolved early when the applicant and the examiner discuss them one-on-one. For the applications involved in the initial pilot, the First-Action Allowance rate increased six-fold when compared to applications from the same technology area not involved in the pilot. . . .

Currently, an applicant may request an interview prior to a first action. Granting of an interview is within the discretion of the examiner who has not yet reviewed the case, and the applicant may be required to identify relevant documents and explain how the invention is patentable over these documents.

Under the expanded pilot program, the examiner will conduct a prior art search and provide the applicant a pre-interview communication, which is a condensed preview of objections or rejections proposed against the claims. Within 30 days from the issue date of the pre-interview communication, the applicant must either choose not to have a first action interview with the examiner, or schedule the interview and file a proposed amendment or remarks (arguments).”

Details: http://www.uspto.gov/web/offices/pac/dapp/opla/preognotice/faipp_v2.htm.


Another University Patent Ownership Dispute: Stanford Loses Rights Based on Researcher’s Side Agreement

Patent, ,

Stanford v. Roche (Fed. Cir. 2009) 08-1509r.pdf

Using federal NIH funding, Stanford scientists developed and patented a method of using PCR to measure HIV virus concentration in blood plasma. The development was done in partnership with the PCR leader Cetus. The Cetus PCR business was later purchased by Roche, and Stanford subsequently offered to license the patent rights to Roche (for a substantial royalty). After negotiations stalled, Stanford sued Roche for patent infringement. Roche claims that it has ownership rights or – at least – shop rights to the patents based on its acquisition of Cetus’s PCR assets. The district court (Judge Patel, N.D. Cal.) rejected Roche’s claim of rights, but did find the patents invalid as obvious (on summary judgment).

Roche’s Ownership: Roche raised ownership rights both as a counterclaim and as a defense. The district court held those claims barred by California’s statute of limitations. On appeal, however, the Federal Circuit held that the general statute of limitations does not operate to block defenses in litigation. Rather, “[u]nder California law, a defense may be raised at any time, even if the matter alleged would be barred by a statute of limitations if asserted as the basis for affirmative relief.” (Quoting Styne v. Stevens, 26 Cal. 4th 42, 51 (2001)). Likewise, the statute of limitations to claiming rights does not apply when ownership is raised as a challenge to a plaintiff’s standing to sue. “It is well settled that questions of standing can be raised at any time and are not foreclosed by, or subject to, statutes of limitation.”

The law of patent ownership is somewhat complex because it involves a mixture of state law (or the law of the local jurisdiction) and federal law. State contract law serves as the baseline, but federal law (esp. Federal Circuit law) creeps into many situations. Here, for instance, the Federal Circuit has held that the “question of whether contractual language effects a present assignment of patent rights, or an agreement to assign rights in the future, is resolved by Federal Circuit law.”

One of the listed inventors first signed an agreement with Stanford – promising to assign any future inventions that emerged from his employment. Later, the inventor signed an agreement with Cetus agreeing “to hereby assign” his interests. Under Federal Circuit law, these two contracts are treated differently. And, although the Cetus agreement came later, the company could claim equitable title immediately at the moment of invention while Stanford needed to actually obtain an assignment. The company also automatically held legal title in the patent application at the moment it was filed. (The inventor did not sign an assignment to Stanford until after filing).

“[B]ecause Cetus’s legal title vested first, Holodniy no longer retained his rights, negating his subsequent assignment to Stanford during patent prosecution.”

Recordation of Rights: Patent ownership regularly transfers without the new owner recording the assignment with the USPTO. Recordation is not required, but it does offer some benefits. Notably, where two entities both claim ownership (as there are in this case), a second assignee can hold title if it records first.

A [prior] assignment . . . shall be void as against any subsequent purchaser or mortgagee for a valuable consideration, without notice, unless it is recorded in the Patent and Trademark Office within three months from its date or prior to the date of such subsequent purchase or mortgage. 35 U.S.C. 261

One caveat in the statute is that the subsequent assignee must be a bona fide purchaser – i.e., take “without notice” and pay “valuable consideration.” Here, the Federal Circuit found that Stanford was at least on inquiry notice of the relationship between the inventor and Cetus and the potential for a rights-transfer.

Standing:

Stanford cannot establish ownership of Holodniy’s interest and lacks standing to assert its claims of infringement against Roche. Thus, the district court lacked jurisdiction over Stanford’s infringement claim and should not have addressed the validity of the patents. The district court’s grant of summary judgment of invalidity is therefore vacated, and the case is remanded with instructions to dismiss Stanford’s claim for lack of standing.

Notes:
  • Stanford would have won the case (at least the ownership issue) if it had written its employee agreement to automatically transfer rights upon creation of the invention. Best practices in patent law dictate that patent ownership (and right to sue) be always maintained in a single entity.
  • In Gerber Scientific Int’l v. Satisloh AG, No. 3:07-CV-1382, (D. Conn., September 25, 2009, order) (P. Dorsey), the court held that the assignment of patent rights in the original case did not include later-filed continuations-in-part (CIPs). “Although courts have found variously worded assignments to include CIPs, Defendants are correct that there is no binding precedent holding that an assignment with the exact terms cited above includes CIPs.” The Court has certified that issue for interlocutory appeal to the Federal Circuit who will likely hear the case. [Zura]

Changing the USPTO Count System: Incrementally

Patent,

USPTO Director David Kappos has announced a set of proposed changes to the patent examiner count system. The proposed changes are not dramatic, but they may have some incremental benefit of reducing RCE churning (see below). The proposal also provides for an additional hour of examination time per case with the expectation that the added time will be used up-front in an interview or in preparing a quality first office action on the merits (FAOM).

The Count System: Under the current count system, examiners receive “counts” for various actions and must meet a certain quota every two-weeks. (The quota varies according to art unit and examiner grade.) Under the rules, one count is awarded when the examiner issues an initial office action rejection and a second count is awarded when the case is disposed-of. Because no counts are awarded for second or subsequent office action rejections, the current system is supposed to encourage examiners to quickly move a case to its conclusion.

RCE Churning: When an applicant files a request for continued examination (RCE), the examiner receives a count as a disposal. At that point, the current count system treats the application as new – thus the examiner can receive a second count for mailing another office action rejection and one more count for eventually allowing the application to issue as a patent. Thus, by “forcing” the RCE, the examiner receives four counts instead of only two. (Note – “Forcing” is in quotation marks because examiner’s do not actually applicants to file RCEs.) A similar practice takes place with restrictions where the examiner pushes an applicant to divide a single patent application into multiple applications. In that scenario, the examiner can at times earn multiple counts for reexamining what are essentially identical inventions.

The proposed package would make some modifications – focusing especially on RCE practice. Under the proposal, the first RCE would only be worth 1.75 total counts (rather than 2) and any subsequent RCE can only be worth 1.5 counts. Examination of the original application would still be worth the same 2 counts, but the distribution is slightly shifted. Under the proposal, the first office action on the merits (FAOM) would garner 1.25 counts; a final rejection earns 0.25 counts; and eventual disposal leads to 0.5 more counts. If no final rejection is issued, then the disposal would be worth 0.75 counts. Thus, examiners will still receive credit for examining RCE’s – just less credit than before. The proposal does not appear to address the restriction practice.

Encouraging substantive interviews: The proposal would also regularly grant one-hour of “non-examining time” for preparing for and conducting interviews. This would effectively reduce the examination quota of examiners who conduct interviews.

Examiner Mistakes: The PTO management appears to have come to an agreement with the examiner union POPA on these reforms, although the membership will still be asked for their approval. Interestingly, the documents distributed by the joint task force appears to show some changes on the review of examiners for mistakes in office actions. Notably, the proposal would not allow an examiner to be negatively treated “based upon a single clear error in Patentability Determination” even if the examiner has already received a warning for prior mistakes.

The proposal also includes a new “formal policy” of “working on the earliest filed applications on [an examiner’s] Regular New Case docket first.” This would block the game played by some examiners of cherry picking easier cases to examine earlier.   

Documents: briefing_for_corps_final_draft-093009.pdf

Claim Construction: A Structured Framework*

Articles and Publications, Patent, , , ,

Guest post by Professor Peter S. Menell (UC-Berkeley School of Law); Matthew D. Powers (Weil, Gotshal & Manges LLP); and Steven C. Carlson (Fish & Richardson PC) 

The construction of patent claims plays a critical role in nearly every patent case. It is central to evaluation of infringement and validity, and can affect or determine the outcome of other significant issues such as unenforceability, enablement, and remedies. Yet jurists and scholars have long lamented the challenges of construing patent claim terms. The Federal Circuit’s en banc decision in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005), stands as the most authoritative decision on claim construction doctrine. But while putting to rest various controversies, many core tensions in claim construction persist. Moreover, the decision itself does not provide a step-by-step approach to construing claims. This commentary provides a structured road map.

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Bits and Bytes No. 131

Conference or CLE
  • IP Czar: George Mason visiting professor Victoria Espinel has been selected as the IP Enforcement Coordinator for the Administration – known as the IP Czar. The role will likely be more focused on international trademark and copyright issues rather than patent law issues. Her nomination must be confirmed by the senate. [LINK]
  • DC in DC: Next Thursday (1:30 p.m., October 1), I’ll be the opening speaker in GWU’s IP Speaker Series. My presentation considers the proposed first-to-file legislation and includes a new set of data the (low) frequency that applicant’s attempt to rely on their invention date during prosecution. The talk is open to GWU students, alumni as well as “friends.” Other speakers include Edward Walterscheid (Oct. 27); Zahr Stauffer (Oct. 29); Joseph Miller (Nov. 5); and Chris Cotropia (Nov. 19). [LINK]

Bits and Bytes No. 131

Conference or CLE, Patent
  • IP Czar: George Mason visiting professor Victoria Espinel has been selected as the IP Enforcement Coordinator for the Administration – known as the IP Czar. The role will likely be more focused on international trademark and copyright issues rather than patent law issues. Her nomination must be confirmed by the senate. [LINK]
  • DC in DC: Next Thursday (1:30 p.m., October 1), I’ll be the opening speaker in GWU’s IP Speaker Series. My presentation considers the proposed first-to-file legislation and includes a new set of data the (low) frequency that applicant’s attempt to rely on their invention date during prosecution. The talk is open to GWU students, alumni as well as “friends.” Other speakers include Edward Walterscheid (Oct. 27); Zahr Stauffer (Oct. 29); Joseph Miller (Nov. 5); and Chris Cotropia (Nov. 19). [LINK]

Bits and Bytes No. 131

Conference or CLE, Patent
  • IP Czar: George Mason visiting professor Victoria Espinel has been selected as the IP Enforcement Coordinator for the Administration – known as the IP Czar. The role will likely be more focused on international trademark and copyright issues rather than patent law issues. Her nomination must be confirmed by the senate. [LINK]
  • DC in DC: Next Thursday (1:30 p.m., October 1), I’ll be the opening speaker in GWU’s IP Speaker Series. My presentation considers the proposed first-to-file legislation and includes a new set of data the (low) frequency that applicant’s attempt to rely on their invention date during prosecution. The talk is open to GWU students, alumni as well as “friends.” Other speakers include Edward Walterscheid (Oct. 27); Zahr Stauffer (Oct. 29); Joseph Miller (Nov. 5); and Chris Cotropia (Nov. 19). [LINK]

An Initial Comment on Prometheus: The Irrelevance of Intangibility

Patent, , , , , , ,

By Kevin Emerson Collins, Associate Professor of Law, Indiana University Maurer School of Law—Bloomington [BIO][Articles][PDF Version of this Post]

Background: The Machine-or-Transformation Test of Bilski

Last fall, the Federal Circuit articulated the “machine-or-transformation” test for patent eligibility in its landmark case In re Bilski, 545 F.3d 943 (Fed. Cir. 2008) (en banc). It held that a method is eligible for patent protection only if it is either (a) limited to a “particular machine” or (b) responsible for transforming a “particular article” into a different state or thing. Id. at 954. Additionally, in a classic example of language that adds judicial wiggle room, the machine or transformation that satisfies either of these prongs “must impose meaningful limits on the claim’s scope,” it “must be central to the purpose of the claimed process,” and it must not be part of “insignificant extra-solution activity” or a “mere data-gathering step.” Id. at 961–62 (emphases added).   

The Supreme Court has accepted certiorari in Bilski, but the impending Supreme Court opinion has not stopped the Federal Circuit from issuing what is perhaps its most important case to date applying the machine-or-transformation test: Prometheus Laboratories, Inc. v. Mayo Collaborative Services. There have been two distinct types of claims that have taken center stage in recent debates over the section 101 doctrine of patent eligibility: “business methods” and what I will call “determine-and-infer methods.” The claim at issue in Bilski describes a classic business method. In contrast, Prometheus involves a determine-and-infer method. The Federal Circuit’s opinion in Prometheus opens a new window into the import of the machine-or-transformation test. Regardless of one’s views of the soundness of Federal Circuit’s reasoning in Prometheus, herein lies one of the opinion’s greatest virtues. By issuing Prometheus before the Court’s oral arguments in Bilski, the Federal Circuit has helped to clarify the stakes of the Court’s decision to sanction, reformulate, or reject the machine-or-transformation test.   

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