Tag Archives: inventorship

Democracy on Trial: Chestek and the Future of USPTO Accountability

by Dennis Crouch

The pending petition for certiorari in Chestek v. Vidal focuses on the extend that the APA requires the USPTO to follow notice-and-comment requirements when promulgating regulations under 35 U.S.C. § 2(b)(2). In its decision below, the Federal Circuit held that the USPTO is exempt from these requirements because the types of rules it is authorized to issue under Section 2(b)(2) are procedural in nature, and the APA excuses “rules of agency … procedure” from the requirements.  There are two ways that the Federal Circuit potentially erred:

  1. The TM applicant home-address requirement being challenged here is not the type of procedural rule exempted under the APA; and
  2. Even if it is procedural, the particular requirements of the Patent Act’s section 2(b)(2) requires following the notice and comment requirements.

The Federal Circuit agreed that 35 U.S.C. § 2(b)(2) requires USPTO regulations to be “made in accordance with” the APA — but disagreed that this requires notice-and-comment for all new regulations. The court concluded that the APA inherently includes an exception for procedural requirements and so the USPTO was not required to follow notice-and-comment rulemaking when promulgating the trademark applicant home-address rule, because the court deemed it to be a procedural rather than substantive rule exempt from those APA requirements.

Five amicus briefs were recently filed in support of the petitioner, arguing that Supreme Court review is warranted to correct the Federal Circuit’s erroneous decision, arguing that the Federal Circuit’s interpretation of Section 2(b)(2) is flawed and undermines important principles of administrative law. (more…)

Decoding Patent Ownership beginning with Core Principles

by Dennis Crouch

In a recent decision, the Federal Circuit vacated a district court’s grant of summary judgment that an inventor, Dr. Mark Core, had automatically assigned a patent associated with his PhD thesis to his then-employer and education funder TRW.  Core Optical Techs., LLC v. Nokia Corp., Nos. 23-1001 (Fed. Cir. May 21, 2024). The key issue was whether Dr. Core developed the patented invention “entirely on [his] own time” under his employment agreement. The majority opinion written by Judge Taranto and joined by Judge Dyk held the contract language was ambiguous on this point and remanded for further factual development to determine the parties’ intent.  Judge Mayer dissented.

Although not discussed in the court’s decision, the appellant brief includes a suggestion that the Federal Circuit should “narrow or overrule” the automatic assignment law seen in FilmTec Corp. v. Allied Signal, Inc., 939 F.2d 1568 (Fed. Cir. 1991), and its progeny (more…)

Guest post by Profs. Chien and Grennan: Unpacking the Innovator-Inventor Gap: Evidence from Engineers

By: Colleen V. Chien, Professor of Law at the University of California, Berkeley School of Law and co-director of the Berkeley Center for Law and Technology, and Jillian Grennan, Associate Professor of Finance and Sustainability at the University of California, Berkeley Haas School of Business. This post is part of a series by the Diversity Pilots Initiative. The Initiative will be hosting its second conference at Emory University Law School in Atlanta on Friday, September 20, 2024. Indicate your interest by signing up here.)

Which IP professionals ascend to partnership or top counsel roles? Which professors publish in the top journals? And which innovators become inventors? This question of who among lawyers, academics, or innovators reaches the next milestone in the progression of a career is relevant in many settings. It has been a central focus in the world of innovation since USPTO’s Director Kathi Vidal’s urgent call to ensure that we “get everyone off the bench” in order to solve world problems and foster economic prosperity.

This call is motivated by the observation that while women comprise 35% of the STEM workforce, they make up only 13% of inventors; Black professionals represent 9% of STEM workers but only 1.2% of inventors. What explains this innovator-inventor gap, the reduced rate at which underrepresented innovators become inventors?  Just as lawyers of varying backgrounds do not equally ascend in firms – with women comprising a slight majority of associates but just 24% of equity partners – the journey from conceiving an idea to becoming a named inventor on a patent is not just a matter of technical merit, but, rather, is significantly influenced by the broader work environment.  Because the progression from innovator to inventor happens largely behind closed, corporate doors, this critical gap has largely been overlooked and its causes, largely unexplored, despite technological innovations’ critical role as a driver of economic growth.

In our study, “Unpacking the Innovator-Inventor Gap: Evidence from Engineers,” which reports on a survey of close to 4,000 innovators across 4 firms, and collaborating firms’ invention disclosure databases, we use detailed administrative and survey data to unpack the forces underlying this gap and provide novel insights into the invention process, how it is influenced by firm policies, and its variation by demographics.  The study’s unique empirical data reveal that inventorship, far from being a rote translation of ideas into patents, reflects an opt-in, competitive process, in which only one-third of engineers engage with their firm’s formal invention submission processes, and only half of these submissions progress to the patent application stage.  Strikingly, participation rates for women at each step of this journey are significantly lower.

A closer examination of the data uncovers additional nuance. While the gender gap is pronounced at all stages of the patenting process, engineers from underrepresented ethnicities exhibit higher engagement levels in both initial ideation and later stages, suggesting distinct experiences and that the barriers and incentives likely differ across demographic groups.  An important take-away for practitioners is that one-size fits all policies to encourage inclusive innovation may not work, rather targeted strategies to address the specific hurdles faced by women and underrepresented ethnicities are warranted.

We gain insights into the process of inventing and the challenges engineers face in going from having an innovative idea to becoming a named inventor by interviewing thirteen patent professionals and the resulting survey of engineers across various collaborating high-tech firms.  The next two figures highlight a key finding takeaway from our study.  Namely, that the path from ideation to patenting is a process fraught with potential frictions attributable to firm policies and systems, cultural norms, and personal experiences.

Figure 1. Variations in the invention submission process across firms

Figure 1 reveals the varied approaches employed by firms in the invention submission process. This figure captures the essence of the diverse practices across different organizations, showcasing the differences in how ideas are collected, reviewed, and iterated upon based on feedback. It serves as a window into the dynamics between engineers, patent professionals, and patent review boards.

Figure 2. Factors influencing the invention submission process

Figure 2 complements Figure 1 by delineating the myriad factors at both the firm (external) and individual (internal) levels that influence an engineer’s decision to submit an inventive idea. It categorizes firm-level factors into informal and formal institutions, such as culture and management practices, while individual-level traits include personal characteristics, early-life experiences, and desires for work-life balance.

Together, these figures underscore the need for a holistic approach to fostering an inclusive inventive environment, one that not only encourages the generation of new ideas but also supports their refinement and submission through processes that are equitable and transparent. As high-tech firms reassess their internal policies and practices, it is helpful to know the specific factors engineers perceive to be working for and against the invention process, in order to cultivate an environment where innovation can thrive.

Using well-established survey techniques, we determine a relative pecking order of factors that contribute to the innovator-inventor gap.  The hierarchy among factors contributing to the innovator-inventor gap as revealed by engineers is management, motivation, culture, the invention submission and review process, mentoring, peer influence, and last personal characteristics. Again, though, we observe that women and URMs perceptions of the factors facilitating invention are distinctive.

For instance, leadership and management practices influence the innovation-invention gap. Better management is the top factor that would increase idea submission. The disparity in engineers’ perception of management is notable, with women and URGs less likely to view management as supportive in the inventing process. Additionally, motivational factors, both extrinsic and intrinsic or pro-social, significantly influence idea submission, with a notable difference in URGs’ desires for creating social value.  Third, corporate culture, especially in terms of aspirational values like collaboration and integrity appear to contribute to the innovator-inventor gap. Female engineers are significantly less likely to (i) experience managers explaining important details, (ii) have people with whom to collaborate, and (iii) experience managers being ethical and making fair decisions. Overall, the creation of a pecking order underscores that the gap is linked to changeable aspects of companies, like management practices and corporate culture, rather than unique individual determinants.

Why is it important to address the inventor-inventor gap?  The final part of our study, in which we examine the patents granted not only to firms in our study, but all U.S. public firms, supplies one answer. We find that patents with female inventors working at firms with meaningful frictions in the innovation process, as proxied by ineffective culture and poor management, are of higher quality and more likely to be in the top 10 percent of citations than the patents of their male counterparts. This outcome is consistent with a model we present which predicts that the costs females face in refining the signal of the patent-worthiness of their inventive idea are higher because of the practices such as inadequate feedback early in the submission process or a lack of peers to collaborate with. Therefore, developing and testing pilots to address these types of information barriers is a particularly promising direction for research and policy.

In conclusion, “Unpacking the Innovator-Inventor Gap: Evidence from Engineers” presents new evidence on the competitive, opt-in nature of the invention process inside high-tech firms and determinants of the innovator-inventor gap, where STEM professionals transition unevenly to being named inventors. Most previous work on inventors focuses on factors influencing the extensive margin like access to STEM education or factors influencing the intensive margin like financial incentives. Our results point to a new, important locus point for inclusive innovation – the workplace and – frictions in the invention process within firms – as a critical factor that determines both who becomes an inventor and the quantity and quality of inventions they pursue. These frictions in the invention process help explain why there is a more pronounced innovator-inventor gap for females. Importantly, we provide evidence that these frictions are so costly to females that they prevent high quality and potentially impactful ideas from being disclosed to society.

By implementing targeted interventions and fostering a culture of inclusion, high-tech firms can unlock the full potential of their diverse workforce, driving forward the frontiers of innovation and securing their competitive edge in the global marketplace. As this analysis has shown, the path forward requires a commitment to systemic change, guided by empirical evidence and grounded in a deep understanding of the challenges faced by underrepresented inventors.

Three main takeaways:

  1. Innovator-Inventor Gap: Only one-third of engineers submit ideas through their firms’ formal invention processes, and just half of these become patent applications. Women participate significantly less at each stage in the journey from potential innovator to patented inventor.
  2. Pecking Order of Factors Influencing the Gap: One key advantage of using a survey to unpack the forces driving the innovator-inventor gap is we hear directly from the engineers who are driving technological progress about their views of the inventive process at their firms.  The hierarchy among factors contributing to the innovator-inventor gap as revealed by engineers is management, motivation, culture, the invention submission and review process, mentoring, peer influence, and last personal characteristics.
  3. Economic implications of the Gap: Analysis of citation patterns suggests that high-quality patents are lost in firms with larger gender gaps. Female inventors at firms with more frictions in the invention process receive significantly more forward citations and are more likely to have their patents be in the top decile of citations, consistent with the marginal lost inventions from women being of high quality.

Read the full paper here: Chien and Grennan, Unpacking the Innovator-Inventor Gap: Evidence from Engineers

If you find this insight compelling and want to stay informed on the latest developments, sign up for the DPI research updates today!

False Patent Marking as False Advertising: Overcoming Dastar

by Dennis Crouch

The Federal Circuit is set to consider the use of terms like “patented,” “proprietary,” and “exclusive” in commercial advertising can be actionable under § 43(a)(1)(B) of the Lanham Act when their use is not entirely accurate. The key issue on appeal is whether the district court erred in granting summary judgment for Crocs on Double Diamond Distribution and U.S.A. Dawgs’ (“Dawgs”) counterclaim for false advertising under the Lanham Act.

This case began back in 2006 (more…)

The Quest for a Meaningful Threshold of Invention: Atlantic Works v. Brady (1883)

by Dennis Crouch

My recent discussion of Vanda v. Teva references the landmark Supreme Court case of Atlantic Works v. Brady, 107 U.S. 192 (1883).  I thought I would write a more complete discussion of this important historic patent case.

Atlantic Works has had a profound impact on the development of patent law, particularly in shaping the doctrine of obviousness, but more generally providing theoretical frameworks for attacking “bad patents.”  As discussed below, I believe the case also provides some early insight into the new AI inventorship dilemma.

The case addressed the validity of a patent granted to Edwin L. Brady for an improved dredge boat design.  The Supreme Court ultimately reversed the lower court’s decision upholding the patent and found instead that Brady’s claimed invention lacked novelty and did not constitute a patentable advance over the prior art.


Inventorship Correction Affirmed for Patent on Intermodal Container for Transporting Gaseous Fluids

by Dennis Crouch

In a recent nonprecedential decision, the Federal Circuit affirmed a district court ruling ordering the correction of inventorship for U.S. Patent No. 9,376,049. Tube-Mac Indus., Inc. v. Campbell, No. 2022-2170 (Fed. Cir. Mar. 15, 2024). The patent at issue, originally naming a single inventor (Steve Campbell), claims a lightweight intermodal container system for transporting refrigerated gaseous fluids.

This post examines the reasoning behind the Federal Circuit’s affirmance as well as the potential applicability of the equitable defense of laches in cases brought under 35 U.S.C. § 256 to correct inventorship on an issued patent.


Joint Inventorship: AI-Human Style

by Dennis Crouch

The U.S. Patent and Trademark Office (USPTO) recently published examination guidance and a request for comments on the treatment of inventorship for inventions created with the assistance of artificial intelligence (AI) systems.  Inventorship Guidance for AI-Assisted Inventions.

The key takeaway here is that the USPTO believes that an AI-developed invention is patentable so long as a human satisfies the joint-inventorship standard of “significantly contributing to the invention.” A human who provides a significant contribution may be the sole inventor and original owner, even in situations where the AI provided the greater contribution.

The PTO’s approach here is fairly broad and will likely serve current AI use cases in most situations because most AI invention models of today are tightly controlled and managed by humans rather than simply arising from AI autogeneration or broad prompting. Thus, from a practical effect, there will likely be at least one natural person who satisfies the joint inventorship standard in the vast majority of cases. (Recognizing here that mere control of an AI is insufficient. Rather, the human must provide significant inventive contribution).

Although I am very sympathetic to recognizing human contributions, I also want a patent system that broadly encourages innovation without either prescribing or proscribing particular approaches. The flexibility of this guidance allows room for both human and machine intelligence to intersect in the creative process. But, we should continue monitoring the effects the policy to ensure it does not unduly constrain AI’s eventual capacity to autonomously formulate inventive concepts. But for now, the USPTO’s basic framework reasonably balances competing interests.

But, the USPTO’s approach is not fully grounded in the law because it allows for patenting of an invention in a situation where no human or combination of humans fully conceived of and originated the invention. Rather, we are simply looking for at least one human who provided a significant contribution. The guidance does not particularly address this issue and, by declining to specifically justify the legal grounds why human “significant contributions” suffice even without complete conception, the USPTO leaves the door open to contrary arguments. Opponents could contend that full conception remains legally required for inventorship and that this expansion of the inventorship doctrine exceeds the statutory language.  It is not clear who will have standing to make this particular argument.


A present assignment of future continuation applications

by Dennis Crouch

In Roku, Inc. v. ITC, the Federal Circuit has affirmed determinations by the International Trade Commission (“ITC”) favoring the patent holder Universal Electronics, Inc. (“Universal”). The most interesting part of the case for me is the assignment issue – whether the patents had been properly assigned at the appropriate time. This can become in cases like this because Universal has created a large patent portfolio that all claim back to original priority documents from more than a decade ago. While most of patents are attributable to both joint-inventors, some are only attributable to one or the other.  Here, though the Federal Circuit supported the simple approach of a “hereby assigns” transfer of rights that includes future continuations.  The decision is lacking though because the court does not ground its decision in any particular contract or property tradition.


No Patent for Robot Inventions: UK Supreme Court Rules on AI Inventorship in Thaler v. Comptroller-General

by Dennis Crouch

Thaler v. Comptroller-General of Patents, Designs and Trade Marks, [2023] UKSC 49. 

In a December 20, 2023 decision, the UK Supreme Court has agreed with American courts that an inventive machine is not deserving of patent rights.  The underlying case will be familiar to many with Dr. Stephen Thaler of St. Louis seeking to patent a thermal-mug designed by an artificial intelligence machine that he created.  Thaler has argued that the AI (called DABUS) conceived of the particular invention in question and also identified its practical utility.  The UK Supreme court based its holding upon the text of the UK Patents Act of 1977 as it reached the same ultimate conclusion as the Federal Circuit in Thaler v. Vidal, 43 F.4th 1207 (Fed. Cir. 2022), cert. denied, 143 S. Ct. 1783 (2023).

These Thaler cases showcase that under the current patent law regime, autonomous AI systems cannot qualify as inventors entitled to patent rights, irrespective of their creativity. For AI-generated inventions to become patentable, intervention by policymakers to amend inventorship laws would likely be necessary. However, the arguably bigger questions of immediate importance surround collaborative human-AI inventions where both human and machine contribute in creation of a new invention. Thaler expressly disclaimed any human input into DABUS’s inventions, but going forward mixed human-AI inventor teams seem inevitable. Neither the UK Supreme Court’s decision nor the parallel US rulings provide direct guidance on the requisite threshold quality or quantity of human participation in such collaborative inventions to satisfy legal inventorship requirements. Thus, for instance, an open issue remains whether token perfunctory human approval of an AI-devised invention would suffice, or if substantive intellectual contribution is needed. And for primarily AI-driven inventions, are minor tweaks by a human collaborator enough? Or must the human contributor objectively supply the novel concept? (more…)

The Fate of Patent Term Adjustment: In re Cellect Seeks Rehearing on Double Patenting

by Dennis Crouch

In August 2023, the Federal Circuit decided an important case questioning how  obviousness-type double patenting (OTDP) is impacted when the terms of two family-member patents that would otherwise expire on the same day are separated by patent term adjustment (PTA) added to the term of one of the patents.  In re Cellect, LLC, 81 F.4th 1216 (Fed. Cir. 2023).  One of Cellect’s patents passed through the PTO quickly, but the other was delayed and thus received extra term as required by the statutory “patent term guarantee” codified in 35 U.S.C. 154(b).  In its panel decision, the Federal Circuit held that Cellect should have filed a terminal disclaimer to disclaim the portion added by the statutory term adjustment.  And, since the patentee did not file the disclaimer, the USPTO properly found the claims invalid under the non-statutory doctrine of OTDP. As Cellect’s attorney Paul Andre stated at oral aguments: “The point of this appeal really comes down to whether a statutory extension or adjustment in it by itself enough to invalidate patents.”  The Federal Circuit found the answer to be “Yes.”  The USPTO has argued that the situation creates an unjustified advantage for the patentee: “As this court has already explained in Boehringer, by failing to terminally disclaim a later patent prior to the expiration of an earlier patent, Cellect enjoyed an unjustified advantage, a purported time extension of the right to exclude from the date of the earlier patent.” USPTO attorney Kakoli Caprihan at oral arguments.

Cellect has now petitioned for en banc rehearing and has received support from several amici, including IPO, NYIPLA, and Bob Armitage.  Cellect’s rehearing petition asserts the panel wrongly treated PTA differently than patent term extension (PTE) under 35 U.S.C. §156 for OTDP purposes. In Novartis AG v. Ezra Ventures LLC, 909 F.3d 1367 (Fed. Cir. 2018), the Federal Circuit held PTE for one family member is not invalidating for OTDP. Cellect contends PTA deserves identical treatment, with OTDP assessing pre-PTA expiration dates. The petition argues the panel misapplied precedent and failed to honor Congressional intent for these “technical term adjustment provisions.”

The statute indicates that the term “shall be extended for 1 day for each day” of USPTO delay. But, it also includes a special caveat for disclaimers: “No patent the term of which has been disclaimed beyond a specified date may be adjusted under this section beyond the expiration date specified in the disclaimer.” 35 U.S.C. § 154(b)(2)(B) (emphasis added). As mentioned above, however, the patentee did not file a disclaimer in this case, and so argues that that this disclaimer provision is not applicable.

Three amicus briefs support Cellect’s petition. I’ll include a few interesting notes from each.  Amicus curiae Bob Armitage proposes rethinking OTDP entirely, suggesting res judicata could address any harassment from enforcing indistinct patents. The NYIPLA argues the panel and Board applied the wrong OTDP test by using a one-way analysis instead of the two-way test required for PTO-delay. It further contends the panel improperly ignored the doctrine’s equitable underpinnings by rigidly applying OTDP without assessing misconduct or gamesmanship. The IPO brief echoes Cellect’s arguments that the panel’s interpretation improperly overrides express statutory language that PTA “shall” issue. IPO contends this formalistic use of ODP to invalidate PTA-adjusted patents is unsound policy that will deter innovation.

The USPTO has been asked to file a responsive brief that was originally due November 30, 2023.  The Solicitor’s office has requested an extension to December 14, 2023 “due to the unusually heavy workload in the Solicitor’s Office.” Nothing in the public record indicates whether the request has been granted or denied.

This case is a bit of an unusual situation because the patentee was never asked to file a terminal disclaimer during prosecution — based upon the briefing this was an oversight by the patent examining corps. However, if Cellect wins, then the USPTO will likely receive substantial pressure to allow terminal disclaimers that include an exception for PTA.

14,000 Words to Win It: Why Medtronic’s Appeal Strategy Backfired

by Dennis Crouch

The Federal Circuit’s new decision in Medtronic v. Teleflex delves into the old pre-AIA law of inventorship and prior art.  It also provides an important appellate procedure lesson with the court finding the appellant waived a key argument. 

Teleflex’s U.S. Patent No. RE46,116 claims methods for using a special extension for its guide catheter. Medtronic filed a pair of IPR petitions, asking the USPTO to cancel the claims. Although the PTAB granted the petitions, it eventually sided with the patentee — agreeing that one of the asserted references did not qualify as prior art.  On appeal, the Federal Circuit has affirmed.

The basic question is whether Itou (7,736,355) qualifies as prior art against Teleflex’s patent (RE46,116). The Itou application was filed about nine-months before the Teleflex application.

Under the AIA Teleflex would clearly lose. Itou was filed first and eventually published and therefore qualifies as prior art under AIA 102(a)(2).  And,  the AIA limited 1-year grace period under 102(b)(2) would not apply since Teleflex did not first disclose the invention. But, these applications are all pre-AIA.

In this situation, Medtronic wants Itou to qualify as prior art as of its application filing date.  That means that we apply pre-AIA 102(e).  35 U.S.C. 102(e) provided that a person shall not be entitled to a patent if the claimed invention was described in a patent granted on an application for patent by another filed in the United States before the invention by the applicant for patent.   Thus, Itou is prior art so long as it was filed prior to the Teleflex invention date.

Proving Invention Date.  Establishing invention date requires determining when the inventor both conceived of the complete invention and then reduced it to practice.  Conception is typically seen as the most important aspect of invention, but invention is not complete until it is reduced to practice. Conception occurs when an inventor forms a definite and permanent idea of the complete and operative invention in their mind. This is the critical inception of the invention. However, conception alone is not enough – the inventor must also reduce the invention to practice. This can occur either by actually building and testing the invention to show it works for its intended purpose (actual reduction to practice).  But, in patent law we also observe the legal fiction that filing a patent application describing the invention in sufficient detail to enable a person skilled in the art to make and use it will also qualify (constructive reduction to practice).

When proving a prior invention date, the law allows inventors to claim all the way back to their provable date of conception, so long as they also show reasonable and continuous diligence by the inventor to reduce the invention to practice.  Thus, if the inventor conceived the invention but then set it aside for a long period before filing a patent application or resuming diligent efforts to reduce it to practice, this can negate the prior invention date.  Once the invention is reduced to practice, diligence is no longer required, but the inventor must be careful not to unduly delay in filing for patent protection because it could create abandonment, estoppel, or laches issues.

In this case, the PTAB agreed with Teleflex that Itou was not prior art, finding that the invention was both actually and constructively reduced to practice before Itou’s filing. On appeal, the Federal Circuit affirmed on the grounds of constructive reduction to practice, declining to reach the issue of actual reduction to practice. Constructive reduction to practice requires (1) conception prior to the filing date of the asserted reference, and (2) reasonably continuous diligence from just before the reference’s filing until the priority application.

Here, Teleflex provided dated technical documents about the “GuideLiner” product it was developing sufficient to prove diligence and submitted declarations and other supporting evidence showing ongoing development of the invention through the filing date of the patent application.   These included records of prototypes, emails, testic documents, manufacturing prep, etc.

On appeal, Medtronic argued that the PTAB erred in finding that Teleflex established an actual reduction to practice before Itou’s filing date. Specifically, Medtronic asserted that the plain language of Teleflex’s claims requires in vivo testing, as the claims recite steps like “advancing a distal end of a guide catheter . . . through a main blood vessel to an ostium of a coronary artery.” According to Medtronic, Teleflex’s bench testing in an anatomical model was insufficient to meet this limitation and demonstrate actual reduction to practice.  In response, Teleflex contended that actual reduction to practice allows some flexibility rather than rigidly requiring that every claim limitation be performed exactly as stated. Teleflex pointed to cases like In Re Spiller finding reduction to practice despite variations from the explicit claim language. However, the Federal Circuit panel questioned whether Spiller actually supports such flexibility, and whether the Board properly construed the precedent it relied on.

Ultimately, the Federal Circuit declined to decide the issue of actual reduction to practice, affirming solely on the grounds of constructive reduction to practice since Medtronic had seemingly waived its diligence arguments on appeal through improper incorporation by reference.

Incorporation by Reference Doesn’t Work: For anyone appealing to the Federal Circuit, the waiver aspect of this case will be the most important part.   Appellants get 14,000 words in their appeal brief. Although that word length is quite a lot — it gets eaten up pretty quickly and appellants are regularly cutting arguments that they feel could be winners. Here, Medtronic attempted to incorporate 20 pages of briefing from another case by reference that detailed its argument on lack-of-diligence.  The brief itself only included a cursory statement that if the Federal Circuit vacated the diligence finding in the parallel case, it should also vacate and remand on diligence here. But, Medtronic did not substantively argue against the PTAB’s diligence analysis in the brief proper. During oral arguments, Judge Chen offered the following remarks:

We have a 14,000 word count limit to our briefing. You’re at 13,979 and on page 41 you want to incorporate 20 pages of briefing from a separate appeal, which would obviously blow right through the 14,000 word count.  So I’m trying to figure out what to do here. We’ve got 14,000 word count limit that’s being blown through. And likewise, we have a pretty strong precedent that says you’re not allowed to incorporate by reference arguments made in other documents into your briefing. So I don’t know if we can read this as a permissible incorporation by reference.

In the decision, the court concluded that the 14,000 word count limit for principal briefs under Federal Circuit Rule 32(a) along with prior precedent prohibits incorporation by reference to ensure parties fully develop their arguments within the allotted word limits. Despite Medtronic asserting the diligence issue was fully briefed in the other case, the Federal Circuit held Medtronic waived any challenges to the PTAB’s diligence determination and affirmed on the basis of Teleflex’s constructive reduction to practice. According to the court, Medtronic made a strategic decision (a bet) regarding how to allocate its words, and could not undo that choice by asking the court to consider extra-record briefing (without a successful motion to extend the word count).  Thus, while Medtronic contested the finding of diligence before the PTAB, the Federal Circuit found this challenge waived on appeal due to inadequate briefing.


Safe, Secure, and Trustworthy Artificial Intelligence

by Dennis Crouch

The White House this week issued a new executive order focusing on a variety of aspects of regulating artificial intelligence, some of which focuses on IP issues.  The executive order lays out eight guiding principles for manages risks while allowing growth and benefits:

  1. Ensuring AI is safe, secure and trustworthy, including through developing guidelines, standards and best practices, verifying reliability, and managing risks related to national security, critical infrastructure and cybersecurity.
  2. Promoting innovation and competition in AI, such as through public-private partnerships, addressing intellectual property issues in ways that “Protect inventors and creators”, and ensuring market competition and opportunities for small businesses.
  3. Supporting workers affected by AI adoption, including through training, principles for workplace deployment, and analyzing labor market impacts.
  4. Advancing equity and civil rights when using AI in criminal justice, government benefits, hiring, and other areas.
  5. Protecting consumers, patients, passengers and students from risks of AI systems.  “[C]onsumer protections are more important than ever in moments of technological change.”
  6. Safeguarding privacy including through evaluating commercial data use and advancing privacy-enhancing technologies. “[T]he Federal Government will ensure that the collection, use, and retention of data is lawful, is secure, and mitigates privacy and confidentiality risks.”
  7. Improving government use of AI.
  8. Strengthening American leadership abroad to advance international cooperation on AI.

Beyond the stated goals, the order has a number of requirements — most of them directed to the various Federal executive agencies.  The tightest new regulations appear intended to focus on future AI models that are a few times larger than what OpenAI and other are currently deploying as well as “dual-use” models that could have potential national security impact.

  • It requires companies developing or intending to develop “potential dual-use foundation models” to provide information to the government about model training, ownership of model weights, results of AI “red team” testing, and measures taken to meet safety objectives.
  • It authorizes the Secretary of Commerce to define the technical conditions that would trigger these reporting requirements. Until defined, reporting is required for models trained on over 10^26 operations or primarily on biological sequence data over 10^23 operations.
  • NIST is charged with developing standards and tests to ensure that AI systems are safe, secure, and trustworthy and the Department of Commerce to develop guidance for content authentication and watermarking of AI-generated content.

The intellectual property-related aspects of the executive order ask the appropriate agencies to work on the problem.

  • It directs the USPTO Director to issue guidance to patent examiners and applicants on AI and inventorship, including issues related to using generative AI in the inventive process. It calls for the USPTO Director to issue updated guidance on patent eligibility for AI and emerging technologies.
  • It instructs the USPTO Director to consult with the Copyright Office and make recommendations on potential executive actions related to copyright and AI, including the scope of protection for AI-generated works and the use of copyrighted works for AI training.
  • It directs Homeland Security to develop a program to address AI-related intellectual property theft, including investigating incidents and enforcing actions. It also calls for updating the IP enforcement strategic plan to address AI.
  • It encourages the FTC to use its authorities to promote competition in the AI marketplace and protect consumers and workers from related harms.
  • It promotes public-private partnerships on advancing innovation, commercialization and risk-mitigation methods for AI. This includes addressing novel IP questions.

None of these requirements have immediate effect, but indicate that there will be further action over the next few months.

Supreme Court Patent Petitions: Seeking Guidance on Eligibility, Inventorship, and Procedure

by Dennis Crouch

A number of petitions are pending before the Supreme Court raising interesting patent issues, although none have been granted certiorari thus far.

Leading Eligibility Case: In next week’s long conference (Sept 26), the court will consider what I see as the current leading case of CareDx Inc. v. Natera, Inc., No. 22-1066. The case focuses on the question of whether the patent covering a new biologic diagnostic method was properly invalidated as directed to a natural phenomenon.

The CareDx invention relates to early noninvasive detection of organ transplant failure–an important and longstanding issue in the field. The detection method involves identifying DNA fragments from the transplant within the bloodstream, a challenge that had stumped scientists for over a decade.  Although various scientists had proposed mechanisms for using this information, the evidence shows more than a decade of failed ideas, and at least one article reported that the process is “difficult and impractical.”  The breakthrough came when Stanford researchers successfully applied high-throughput multiplex sequencing (“shotgun sequencing”) to detect single nucleotide polymorphisms (SNPs) unique to donor organs.  Of potential importance, the Stanford researchers did not create these new sequencing techniques, but they were the first to take advantage of them in this particular context and identified particular thresholds in crafting a method that works in this situation.  The claims were invalidated by the district court, and that judgment affirmed on appeal.

Another Natural Law Case: A second well written natural phenom petition was recently filed in ChromaDex, Inc. v. Elysium Health, Inc., No. 23-245.  The patent in that case claims a dietary supplement of nicotinamide riboside (“NR”) that increases the production of nicotinamide adenine dinucleotide (“NAD+”) — this one was crated by folks at Dartmouth.  I have written previously that the Supreme Court’s product of nature in Myriad is hard to square with the two-step abstract idea / law of nature cases of Alice & Mayo.  In its decision, the Federal Circuit concluded that the two-step approach is inapplicable in the natural phenomenon case — thus omitting consideration of any inventive concept going beyond the excluded portion.  The Hail Mary case of Killian v. Vidal, No. 22-1220, argues that the judge made eligibility exceptions represent a Fifth Amendment taking, a due process violation, and represent ultra vires actions.

IPR Estoppel: A second important case awaiting the late-September conference is Ingenio, Inc. v. Click-to-Call Technologies LP, No. 22-873, focusing on the scope of IPR estoppel under 35 USC 315(e).  The case asks whether the Federal Circuit erroneously extended IPR estoppel under 35 U.S.C. § 315(e) to all grounds that reasonably could have been raised in the petition. They focus on the the statutory language that, under their reading, applies the reasonably-could-have modifier in a much narrower context. To wit, petitioner argues that estoppel only applies to issues that could have been raised after the petition was granted– that petitioner “reasonably could have raised during that inter partes review.”

Favorite Pending Case – Inventorship: My favorite pending case is HIP, Inc. v. Hormel Foods Corporation, No. 23-185. HIP argues that the Federal Circuit’s decision improperly heightens the standard for joint inventorship by focusing on quantity rather than substance of inventive contributions. HIP contends any original contribution included in a claim, even if partial, warrants joint inventor status under 35 U.S.C. § 116.  In the case, a HIP engineer provided suggestions to Hormel on implementing a pre-cooked bacon method. HIP’s suggestion (using an infrared oven for the preheating step) made its way into the claims, the court concluded it was not significant enough to warrant joint inventorship.  For me, the case is largely about the strong presumption that the listed inventors are correct.

Additional Pending Petitions: Two more pending petitions. In Personalized Media Communication, LLC v. Apple Inc., No. 23-230, the patentee PMC argues that the court improperly applied prosecution laches to render its patents entirely unenforceable. PMC argues that under cases such as SCA Hygiene, a patentee’s compliance with statutory deadlines precludes equity from stepping in via laches.  I believe that PMC owns the most pre-GATT patents that are still within their patent term. Yes, even more than Gill Hyatt.   Finally, in Salazar v. AT&T Mobility LLC, No. 23-241, the petitioner argues that the Federal Circuit acted improperly by issuing an unforeseeably narrow claim construction on appeal.  Back in 1995 when these applications were filed, Apple had just released an updated Newton that included Graffiti handwriting recognition software from Palm.

Conclusion: The Supreme Court has not yet granted certiorari on any of these patent law petitions, but their treatment of these issues will provide valuable guidance. Cases like HIP v. Hormel and ChromaDex v. Elysium give the Court opportunities to clarify murky areas of the law around joint inventorship and patent eligibility. Meanwhile, petitions in Ingenio v. Click-To-Call and PMC v. Apple deal with critical procedural issues tied to post-issuance review and prosecution laches. The next few weeks may prove pivotal as the Court considers which of these issues merit its attention.

Double Patenting and Patent Term Adjustment

by Dennis Crouch

The Federal Circuit recently issued an important decision in In re: Cellect, LLC (Fed. Cir. Aug. 28, 2023) regarding how Patent Term Adjustment (PTA) interacts with terminal disclaimers and obviousness-type double patenting (ODP). This case establishes binding precedent that a terminal disclaimer cuts off any extended patent term granted through PTA.

This holding contrasts with the court’s prior rulings regarding Patent Term Extension (PTE), where the extended term is calculated from the disclaimed expiration date, not the original expiration date. Thus, PTE extends beyond a disclaimed term, while PTA does not.

This result was expected by many patent experts, although some in the pharmaceutical industry had pushed for PTA to extend beyond disclaimed terms similarly to PTE. In the end, the statutory language expressly addressing disclaimers in the context of PTA proved decisive. This precedent will apply to all patents already in-force as well as those issued in the future.  Thus, applicants will want to carefully consider PTA and terminal disclaimer strategy for patent families.

If I were the judge, I would consider eliminating non-statutory double patenting. I expect the doctrine would have never developed under our current patent term calculation and is instead a vestige of history.

Millions of U.S. patents are tied to a family member patent via terminal disclaimer and its accompanying promise of continued common ownership.  A terminal disclaimer generally disclaims any patent term that would extend beyond the expiration date of the full statutory term of the reference patent and are generally required for the USPTO in order to overcome a rejection for obviousness-type double patenting.

Obviousness-type double patenting (ODP) is a judicially created doctrine that prevents an inventor from obtaining a second patent for claims that are not patentably distinct from claims in a first patent. The doctrine has its stated origins in 35 U.S.C. 101, which provides that an inventor may obtain “a patent” (singular) for an invention.  The obviousness question normally focuses on prior-art as required by Section 103.  ODP doctrine does not consider prior art but rather non-prior-art patents (or applications) with overlapping inventorship.

Although the statutory hook of Section 101 focuses on one-patent-per-invention, the policy concern is also highly focused on ensuring that a patentee cannot obtain multiple patents on a single invention in order to improperly extend the patent term.  This problem is largely historic — stemming from the time when patent term was determined based upon the date of issuance and prior to publication of applications.  These transformations have substantially limited gamesmanship potential.  However, in the patent-term-adjustment world, it is possible to extend a patent’s term by several years in situations where the patent applicant has a successful PTAB appeal.

ODP is intended to prevent an inventor from securing a second, later-expiring patent for small modifications or obvious variations of the same invention claimed in an earlier patent. The goal is to prevent an unjustified extension of the term of exclusivity for the invention beyond the original patent term. ODP is most commonly applied when two commonly owned patents share overlapping or obvious claims but have different expiration dates.  The courts have concluded that a terminal disclaimer by the patentee along with a binding promise of ongoing co-ownership serves as a solution — allowing both patents to issue.  The result is effectively a single patent with a single patent term designed to preventing potential harassment from multiple assignees asserting commonly owned patents covering the same invention.

= = =

The case at hand involves several Cellect patents related to image sensors in personal digital assistants and phones.  The patents are all part of a family and all claim priority to the same original application. The patents also received varying Patent Term Adjustment (PTA) to extend their terms due to USPTO delays during examination.

After Cellect sued Samsung for infringement, Samsung requested ex parte reexaminations of Cellect’s patents asserting they were unpatentable for obviousness-type double patenting (ODP) over earlier expiring patents in the family.  The examiner agreed the claims were unpatentable for ODP in the reexaminations. The Board affirmed the unpatentability findings.

On appeal, Cellect argued that PTA should be available beyond the disclaimed portion of the term — noting that the judge-made-law could not overcome the statutory guarantee.  On appeal, however, the Federal Circuit affirmed the Board and rejected Cellect’s arguments.  The clincher here is that Congress identified disclaimers within the PTA statute, stating: “No patent the term of  which has been disclaimed beyond a specified date may be adjusted under this section beyond the expiration date specified in the disclaimer.”  35 U.S.C. 154(b)(2)(B).   In other words, Congress appears to be stating that PTA  cannot extend a patent term beyond what was disclaimed — but this is exactly what Cellect was asking for.  The appellate panel also agreed with the PTAB that Cellect received an unjustified timewise extension and a terminal disclaimer was required to ensure common ownership since the later patents were clearly obvious variants of the original.  An otherwise result would effectively confer PTA on the earlier issued patents even though they were not entitled.

In summary, the unjustified extension stemmed from the challenged claims extending beyond the expiration of the one family member (‘036) that did not receive PTA. This could have been resolved with a terminal disclaimer, but none were filed.

The decision thus establishes how PTA granted under 35 USC 154 should be factored into the ODP analysis — and the result does not favor patent families.

Guest Post: Diversity Pledge: Boosting Innovation and Competitiveness

By: Suzanne Harrison, Chair of the Patent Public Advisory Committee (PPAC) at the USPTO.  This post is part of a series by the Diversity Pilots Initiative, which advances inclusive innovation through rigorous research. The first blog in the series is here and resources from the first conference of the initiative are available here.

In July 2021, the USIPA hosted a DEI in innovation conference and launched The Diversity Pledge, alongside 30 founding Pledgee companies who agreed to increase the participation of under-represented inventors (URIs) in their own firms.  Currently, over 50 technology companies have committed to the Diversity Pledge from both the US and Europe across a variety of different industries as well as over 25 law firms and consulting firms as pledge supporters. On August 1st, we held the second conference on Increasing Diversity in the Innovation Ecosystem with the USPTO and showcased what companies, law firms, universities and the USPTO are doing in their respective organizations to increase DEI within inventorship, innovation and the IP profession.

When we created the Diversity Pledge, our hope was to create more transparency in innovation and inventorship inclusivity, by creating a standard metric for companies to report on their DEI reports.  What we have come to realize however, is that increasing diversity and inclusivity in innovation is not only an equal-opportunity social imperative, it is a common sense means to improve R&D efficiency, corporate ROI and it is also a necessity for maintaining and increasing national competitiveness. Because we can’t afford to leave our most talented people on the sidelines, the goal must be actionable, not performative.

So, two years into this movement, what have we learned?  Creating a metric and asking companies to focus on improving it has led them to implement best practices, try out a variety pf process improvements which have led to substantive changes.  Of the 50 Pledgee companies, 30 of them participated in our first round of reporting, as not all of them had been Pledgees long enough to have a full year of data to report.  Of the 30 reporting, 17 provided women inventor rates (WIR) for year 1 and 6 provided the WIR rate for year 2. You can see the results in Figure 1 below:

Figure 1

For clarity, Pledgees were not required to report their WIR numbers, but chose to do so.  So, for the 6 Pledgees that reported two years of data, we can see that focusing on increasing inclusivity in inventorship for women, led to an average increase of women on patent applications of 23%.  For comparison, the US national WIR as determined by the USPTO is 13% so our Pledgees mean WIR in both year 1 and 2 are above the national average.  How are companies achieving these results?  At the conference we heard about a number of different things companies are doing.  First, mentoring women on the inventorship process and how they can improve their invention disclosure and patent application success rates.  Companies are also looking at how to better integrate underrepresented inventors into the innovation process and how to ensure both their voices and ideas are heard and incorporated.  Many of these efforts are being piloted by companies, and groups such as the Diversity Pilots Initiative (DPI) are crucial to helping us determine what actually works versus “seems” to work.   Many Pledgees have worked with DPI and have determined what interventions are successful and have allowed us to genericize those efforts and promulgate within Pledgees for continued success.

Two years ago, companies were focused on having us explain the value they would receive by focusing on inclusivity in inventorship or DEI in general.  While we still get occasional questions about this, recent data from both Gartner and World Economic Forum show that diverse teams within corporations, will exceed their financial targets, and drive a higher average revenue from innovation.  For companies this often translates to higher revenue and/or profit, increased employee retention, and lower hiring costs (as potential employees are interested in working for companies that appear more inclusive). But the real value for the nation, comes from increased employment and higher state and national gross domestic product (GDP).  This focus on jobs and GDP has caught the attention of both the Department of Commerce (DoC) and the USPTO.  Between the DoC and the National Science Foundation (NSF), these two agencies are investing over $1.3 billion in revitalizing America’s innovation ecosystem.  Finding out that one can use patent data to help visualize who is and is not participating in our innovation ecosystems, helps us figure out who to include in this process.

Additionally, the work Diversity Pledgees are doing is laying the groundwork for how companies, universities and law firms can make meaningful contribution to not only their own profitability, but also to our national economic and technological success. This point was made crystal clear in the fireside chat with Director Kathi Vidal and Deputy Secretary of Commerce Don Graves at the conference.  In my 30 years as an IP practitioner, I cannot recall ever hearing anyone from the DoC talk about the importance of IP and innovation to the economy.  While we all intuitively believe that focusing on DEI is the right thing to do, finding out that it can truly help the nation is invaluable.  So, if you haven’t started on your DEI journey yet, what are you waiting for?  Knowing you can make an impact for both your company and country seems like a no brainer.

Three Key Take-Aways

  • Immediate Innovation Impact: Pledgee companies focusing on DEI report an average 23% increase in women on patent applications, surpassing the US national WIR.
  • National Competitiveness Boost: DEI initiatives, supported by the DoC and USPTO, are highlighted as essential for improving national employment rates and GDP.
  • Blueprint for Profitable Inclusion: The Diversity Pledge and collaborations like DPI are helping organizations elevate DEI, enhancing both their profitability and national economic success.

If you find this insight compelling and want to stay informed on the latest developments, sign up for the DPI research updates today!

Challenges of Proving Inventorship: Corroboration of All Inventive Facts

by Dennis Crouch

Medtronic, Inc. v. Teleflex Innovations S.A.R.L., — F.4th — (Fed. Cir. 2023)

The case involving Medtronic and Teleflex centered on five patents related to a coaxial guide catheter used in interventional cardiology procedures. These patents, US Patents 8,048,032, RE45,380, RE45,776, RE45,760, and RE47,379, cover inventions devised to offer an “enhanced backup support” in contrast to using a guide catheter individually.

In an attempt to invalidate these patents, Medtronic launched a succession of Inter Partes Review (IPR) petitions. Despite the initial approval of the petitions, the Board eventually ruled in favor of Teleflex, the patent holder. The pivotal question on appeal was whether U.S. Patent 7,736,355 (“Itou”) could be regarded as prior art.

In a split decision, the Federal Circuit confirmed the Board’s decision, establishing that the first-to-invent law from before the America Invents Act (AIA) allowed Teleflex to antedate the prior art by demonstrating prior invention. The case underlines a situation where the transition to the AIA has resulted in the loss of certain rights for patent holders. Under the AIA’s provisions, Itou would have been considered prior art, therefore preventing Teleflex’s patenting. The also case stands out as Itou was clearly the first inventor, but this evidence was not taken into account due both to arcane pre-AIA rules and due to the IPR process focusing only on the published patent documents.

Teleflex’s patents claim a priority filing date of May 3, 2006, based on a purported conception date in early 2005. Itou’s priority application was filed in Japan in September 2004, and a year later, the US application was filed on September 23, 2005. Despite Itou pioneering the invention in Japan and filing the Japanese patent application prior to Teleflex’s invention, Teleflex arguably demonstrated an invention date that preceded Itou’s US filing date, which was critical for the court’s decision.

A crucial regulation in this context is pre-AIA 102(e), which introduces a form of ‘secret prior art’ for patent applications that are unpublished as of the patentee’s invention date. Under this regulation, a third party’s US or PCT patent application becomes prior art once published. However, the quirk of 102(e) as compared to pre-AIA 102(a) lies in the fact that these applications are treated as prior art from their filing date, not their publication date. An important subtlety is that a foreign patent filings, like Itou’s Japanese application, do not qualify as prior art under 102(e). In re Hilmer, 149 USPQ 480 (CCPA 1966).

Proving Prior Invention: The concept of ‘invention date’ is crucial in pre-AIA patent cases, and typically, this date is assumed to be the filing date of the patent application. The patentee can then furnish evidence to establish an earlier date of invention, which usually involves a sworn declaration from the inventor, corroborated by additional evidence. Perfect Surgical Techs., Inc. v. Olympus Am., Inc., 841 F.3d 1004 (Fed. Cir. 2016).

Both the Patent Trial and Appeal Board (PTAB) and the majority judges (Judge Lourie and Chief Judge Moore) concurred that Teleflex had provided adequate evidence to substantiate an earlier invention date. Judge Dyk, however, wrote in dissent.

It’s important to understand that the process of invention involves two steps – conception and reduction to practice. The majority and dissent agreed that Teleflex had provided evidence sufficient to proven both conception and the creation of a prototype before the critical date. However, reduction to practice also necessitates evidence demonstrating the suitability of the invention for its intended purpose. For complex inventions like the one in this case, the courts can require testing to establish this suitability prong. Steinberg v. Seitz, 517 F.2d 1359 (C.C.P.A. 1975). While the majority deemed the evidence of testing adequate, the dissent argued it was insufficient — with the debate focusing on the extent of corroboration required.

The majority observed, “[B]oth inventors Howard Root and Gregg Sutton testified regarding testing performed on a prototype of the claimed invention. These tests, although more qualitative than quantitative, were sufficient to confirm that the prototype would work for its intended purpose — providing increased backup support as compared with a guide catheter alone.” The judges concurred with the Board’s view that the tests did not require a direct comparison or a quantitative analysis to prove improvement in function. They also noted expert testimony suggesting “qualitative testing would have been sufficient.”

However, Judge Dyk, dissenting, questioned the lack of corroborative evidence supporting the prior testing. He cited to Cooper v. Goldfarb, 154 F.3d 1321 (Fed. Cir. 1998), to assert that “[i]n order to establish an actual reduction to practice, an inventor’s testimony must be corroborated by independent evidence.” Judge Dyk particularly concluded that every “inventive fact” should be corroborated with evidence beyond the inventors’ testimonies.

The corroborating evidence in this case included a sales presentation and two non-inventors’ testimonies. However, Judge Dyk believed that this evidence did not provide any information regarding proof of operation for the intended purpose. Specifically, there was “no specific description of what tests were performed or the results of the tests … [or] when the tests were performed and whether they were performed before the critical date.” Dissent.

The majority responded that not every detail of reduction-to-practice needs to be independently corroborated, advocating for a rule of reason. Despite agreeing with this general principle, Judge Dyk insisted that the lack of corroboratory evidence regarding testing for the intended use couldn’t be overlooked.

Judge Dyk, in his dissent, noted the lack of internal documents from Teleflex corroborating any testing during the crucial period in 2005. “Common sense, and Teleflex’s own testimony [showing record keeping in this area], suggest that these documents would exist if testing had occurred.” Dissent. He argued requiring such documents did not created an unreasonable standard for inventors seeking to enforce a patent claim. Judge Dyk’s dissent concludes that “I think that Itou has been shown to be prior art to the patents at issue and therefore could support a determination of anticipation or obviousness.”

However, the majority, led by Judge Lourie, disagreed with the dissent and upheld the PTAB’s decision in favor of Teleflex.

The attorneys for the appellants (Medtronic) were led by Tasha Bahal from Wilmer Cutler. Representing Teleflex were attorneys from Carlson Caspers, led by Derek Vandenburg.

Bringing Home the Bacon with Joint Inventorship

Guest Post by Jordan Duenckel.  Jordan is a second-year law student at the University of Missouri, head of our IP student association, and a registered patent agent.  He has an extensive background in chemistry and food science.

HIP, Inc., v. Hormel Foods Corp., 2022-1696, — F.4th — (Fed. Cir. May 2, 2023)

Joint inventorship requires a substantial contribution to the invention. In the decision HIP, Inc. vs. Hormel, Judge Lourie writes for a unanimous panel to reverse a district court’s determination of joint inventorship involving a new process for precooking bacon. US Patent 9,980,498 has four inventors that are employees of and assigned their interest to Hormel.  HIP sued Hormel, alleging that David Howard was either the sole inventor or a joint inventor of the ’498 patent. The district court determined that Howard was a joint inventor based solely on his alleged contribution to the infrared preheating concept in independent claim 5.  

Bacon is an interesting food with unique preservation and cooking properties. Being a cured product, for food safety reasons, no additional cooking of the bacon is needed when bought off the shelf in a refrigerated section. Of course, most people are not consuming the bacon without additional cooking and some companies will precook the product for consumer convenience. When precooking, Hormel is trying to avoid the loss of salt, and therefore flavor, through condensation and prevent the creation charred off flavors (as opposed to the desirable char on a steak).  

 In the process of viability testing the new method, prior to filing the application, the inventors consulted with David Howard of Unitherm, HIP’s predecessor, to discuss methods related to Unitherm’s cooking equipment to create a two-step process of preheating then a higher temperature step. After some difficulties, Hormel leased the equipment and returned to their own R&D lab. The method created, the subject matter of the ‘498 patent, involves a first step that allows the fat of the bacon to seal the surface of the bacon and prevent condensation. The charring was remedied by adjusting the heating method of the oven in the second step of high-temperature cooking. In Hormel’s product development, Hormel tried an infrared oven and a conventional spiral oven.

HIP argued that Howard contributed to the ‘498 patent in the preheating by hot air in claim 5 and/or preheating with an infrared oven in claim 5.  Claim Five reads in the relevant part:  

  1. A method of making precooked meat pieces using a hybrid cooking system, comprising: preheating meat pieces in a first cooking compartment using a preheating method selected from the group consisting of a microwave oven, an infrared oven, and hot air to a temperature of at least 140º F. to create preheated meat pieces…

On appeal, Hormel argues that Howard’s contribution is well-known in the art and insignificant when measured against the full invention. With inventorship being a question of law, and the issuance of a patent creating a presumption of inventorship, an alleged joint inventor must provide clear and convincing evidence to substantiate their claim. In evaluating whether a significant contribution was made by Howards, the parties apply the test from Pannu v. Iolab Corp., 155 F.3d 1344, 1351 (Fed. Cir. 1998). The test requires that the alleged joint inventor: 

(1) contributed in some significant manner to the conception of the invention; (2) made a contribution to the claimed invention that is not insignificant in quality, when that contribution is measured against the dimension of the full invention; and (3) did more than merely explain to the real inventors well-known concepts and/or the current state of the art. 

Analyzing the second Pannu factor, the Court found that the alleged contribution of preheating meat pieces using an infrared oven to be insignificant in quality because it was mentioned only once in the patent specification as an alternative heating method to a microwave oven and was recited only once in one Markush grouping in a single claim. In contrast, preheating with microwave ovens and microwave ovens themselves were prominently featured throughout the specification, claims, and figures. The examples and corresponding figures also employed procedures using preheating with a microwave oven, but not preheating with an infrared oven.  

Infrared heating seems to have been an afterthought in the creation of the two-step precooking method. Whatever discussions Howard might have had about the importance of the infrared, Hormel seems to have focused on microwave heating to solve the condensation problem. From one step further back, it seems absurd to permit joint ownership by a cooking equipment manufacturer when the significant discoveries and refinements of the methods were made in Hormel’s R&D facility without Howard present. The prevention of condensation and avoiding the char flavor were both made independent of Howard’s contributions. Considering the second Pannu factor, the reversal of inventorship seems appropriate.  

Guidance on Patenting Inventions with AI Contributions

The following are my remarks given on April 25, 2023 to the USPTO as part of their AI listening session:

by Dennis Crouch

Members of the USPTO, and fellow participants of this AI Listening Session, thank you for inviting me here today and for taking time to consider these important issues.  I want to also thank the prior speakers who have done a great job laying out many of the issues.  I am also happy to work with any of you to help figure this out and reach a workable system that truly encourages innovation.

My name is Dennis Crouch, and I am a law professor at Mizzou and author of Patently-O. It is my privilege to discuss the role of generative AI in the realm of intellectual property and the need for clear guidance from the USPTO.

As artificial intelligence progresses at an unprecedented pace, numerous cases have emerged where generative AI has played a crucial role in conceiving an invention. In certain instances, if the AI were human, it would be rightfully recognized as at least a joint inventor. This raises the question of whether it is appropriate to designate the human, who contributed to only a part of the invention and collaborated with the AI, as the sole inventor. This is particularly concerning in cases where the AI introduced concepts that the human had not conceived or even considered. Generative AI differs from traditional tools in that its responses are unpredictable and it produces results akin to those of a human inventor.

I would like to draw attention to a striking similarity between generative AI and biological models, particularly in the context of the pending Supreme Court case of Amgen v. Sanofi. In this case, researchers patented a genus of monoclonal antibodies, but the antibodies’ amino acid sequences were not designed by humans. Instead, a genetically modified humanized mouse generated the antibodies in response to a specific antigen. This scenario closely mirrors the role of generative AI in the invention process.

The parallel between the genetically modified humanized mouse and generative AI becomes apparent when we examine the prompt given to the mouse in the form of a PCSK9 injection and the subsequent response: antibodies collected from the mouse’s spleen. This analogy can be applied to generative AI, with a human providing the initial input or prompt, and the AI system generating an inventive output.

One key issue is the uncertainty patent attorneys face regarding the proper course of action. Innovators are seeking to protect their valuable inventions, but the lack of clear guidance creates potential ethical dilemmas for patent attorneys. I recently published an article on Patently-O titled “AI Inventor and the Ethics Trap for US Patent Attorneys,” highlighting this concern.

I believe the USPTO should promptly offer guidance, stating that patent applications may appropriately list the human contributor to the conception as the sole inventor, even in situations where an AI or other tool provided key elements of the discovery.

The US Copyright Office has taken steps to deny registration of AI-created works. It is essential for the USPTO to avoid the current pitfalls of the US Copyright Office in addressing AI-related issues.  Ideally, US intellectual property policymakers would consider all aspects of IP—patent, trade secret, and copyright in our situation here—as a unified whole. This might present an opportunity to contemplate the establishment of a US Intellectual Property Office that merges the PTO and Copyright Office, while also providing some authority to regulate trade secrecy.

As several speakers have noted, generative AI is expected to reduce the cost of inventing, which is a tremendous benefit. As Profs Levine and Feldman explained, AI has different incentives than human inventors and lacks the fundamental humanity that our inventorship laws respect.  Still, a valuable technological improvement by an AI (such as a new medical treatment) is something that we want to encourage.

For inventions without direct human contribution, it is timely to consider a special rights category for computer-generated inventions. This unique exclusivity could feature a reduced term and additional requirements to ensure clarity and patentability, such as pre-screening, limited claims, definitions, and the incorporation of born-digital aspects of the documentation.

In conclusion, it is imperative for the USPTO to provide guidance on how to handle generative AI’s role in the invention process – distinguishing between situations where a human inventor exists and those with in no or insufficient human originality.

AI Inventor and the Ethics Trap for US Patent Attorneys

by Dennis Crouch

The Supreme Court denied certiorari in Thaler v. Vidal, a case involving inventor Dr. Stephen Thaler’s attempt to patent an invention created by his artificial intelligence (AI) system, DABUS. Thaler argued that DABUS, not himself or any other human, conceived the invention and identified its significance. However, both the United States Patent and Trademark Office (USPTO) and the Court of Appeals for the Federal Circuit  (CAFC) maintained that US patent laws require a human inventor, and as a result, they refused to consider Thaler’s patent application.

In his petition to the Supreme Court, Thaler asked if the Patent Act restricts the statutory term “inventor” solely to human beings. The current legal stance in the US remains that the answer to this question is “yes,” human inventors and only human inventors.

Moving forward, I am quite concerned for the role of patent attorneys and the upcoming ethical dilemmas — that patent attorneys will be prompted to bury the truth about AI contributions within their patent applications.  In particular, a growing number of inventive entities are developing new products and designs with significant AI input. And, many of the resulting claims will be directed to aspects that were generated by the AI and then first recognized as patentable by either the AI or the patent attorney.  In that situation, the patent attorney will be asked to list the human closest to the invention as the inventor — but, depending upon the circumstances, that listing might turn out to be fraud.

This situation calls for a guidance from the USPTO or the legislature on the definition of “inventor” in the context of AI-generated inventions. The current legal framework does not adequately address this evolving landscape of innovation driven by AI.

I particularly like to think about this situation in the joint inventorship context because the contribution and recognition requirements are much easier to meet than for a solo inventor.  In my experience, generative AI are regularly providing conceptual input that would easily require listing as a joint-inventor, except for the exclusion of non-human inventors.

What do you think here?

= = =

USPTO is holding an AI listening session on April 25 at the USPTO (and webcast). See you there: https://www.uspto.gov/about-us/events/ai-inventorship-listening-session-east-coast