Tag Archives: Supreme Court

Supreme Court Reins-In Patent Venue

by Dennis Crouch

In TC Heartland LLC v. Kraft Foods Group Brands LLC, the Supreme Court has significantly shifted the balance away from the geographically fringe Eastern District of Texas – holding that the residence requirement of 28 U.S.C. § 1400(b) refers only to a defendant’s State of Incorporation for patent infringement venue purposes.

Read the Decision: 16-341_8n59.

The short (10-page) unanimous opinion authored by Justice Thomas reaffirms the court’s prior decision in Fourco Glass Co. v. Transmirra Products Corp., 353 U. S. 222, 226 (1957) — holding again that “for purposes of §1400(b) a domestic corporation ‘resides’ only in its State of incorporation” and rejecting the notion that a much broader definition of venue (found in §1391) applies.

Although the Supreme Court law appears continuous.  The Federal Circuit created a major blip in its 1990 decision of VE Holding Corp. v. Johnson Gas Appliance Co., 917 F. 2d 1574 (1990).  In that case, the appellate court held that patent infringement venue is proper in any court having personal jurisdiction over the defendant.  That expansive change allowed for the rise of patent-focused venues such as the Eastern District of Texas where the majority of infringement lawsuits have been filed over the two decades (heat map below). PatentLawPic984

What next:  Section 1400(b) limits patent cases to the judicial district (1) “where the defendant resides,” or (2) “where the defendant has committed acts of infringement and has a regular and established place of business.”  This means a likely large boost of lawsuits in Delaware.  National retailers will still be amenable to suit essentially everywhere, but many would-be defendants will be able to avoid E.D.Texas at least. There will also be new litigation on the implications for foreign companies with no established place of business in the US.  The decision here expressly refuses to address that question other than noting that it did previously decide that foreign corps can be an exception to 1400(b). Although possible, it is unlikely the court will adapt the “established place of business” to include the internet, although that portion of 1400(b) has not been explored since the e-tailing explosion.  With less concentrated venue, I we can also expect a rise in multi-district litigation.  For more, consider Prof Janicke’s article on the Imminent Outpouring from the Eastern District of Texas.

 

SAS Institute v. Lee: Partial Institution of Inter Partes Review

by Dennis Crouch

The Supreme Court has agreed to hear a new AIA-trials case: SAS Institute v. Lee

The inter partes review appeal focuses on the procedural question of whether the America Invents Act permits the USPTO to partially institute IPR proceedings – as it has been doing. SAS argues instead that the statute requires a full up/down vote on a petition and, if granted, the Patent Trial and Appeal Board (PTAB) must then pass final judgment on all petitioned claims:

Whether 35 U.S.C. § 318(a) … requires [the] Board to issue a final written decision as to every claim challenged by the petitioner, or whether it allows that Board to issue a final written decision with respect to the patentability of only some of the patent claims challenged by the petitioner, as the U.S. Court of Appeals for the Federal Circuit held.

As I previously wrote,

The basic setup here is that SAS argues that the PTO cannot partially institute IPR proceedings since the statute requires that PTO “shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner.” 35 U.S.C. § 318(a)

Although a somewhat sideline issue, it will likely have its biggest impact on estoppel resulting from AIA trials and, as a result, may also shift filing strategy.

AIA Trial Docs:

 

 

SAS Institute Inc. v. Lee: Challenging Partial Institution

The Supreme court has relisted SAS Institute Inc. v. Lee, 16-969 – an important step in the progress toward grant of certiorari.  The inter partes review case presents the following question:

Whether 35 U.S.C. § 318(a) … requires [the] Board to issue a final written decision as to every claim challenged by the petitioner, or whether it allows that Board to issue a final written decision with respect to the patentability of only some of the patent claims challenged by the petitioner, as the U.S. Court of Appeals for the Federal Circuit held.

The basic setup here is that SAS argues that the PTO cannot partially institute IPR proceedings since the statute requires that PTO “shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner.”

Although the Department of Justice has sided with the PTO’s approach here, in a prior filing the DOJ argued that the PTO erred in “picking and choosing some but not all of the challenged claims in its Decision.” See Department of Justice v. Discovery Patents, LLC, Case IPR2016-01041 (Patent Trial & Appeal Bd., Nov. 29, 2016).

The outcome of a rule-change here  is unclear – while the patent challenger (SAS) is petitioner here.  Patentees may prefer the all-or-nothing approach that would hopefully result in final judgments confirming patentability as well as the resulting estoppel.

 

Shore v. Lee

In Shore v. Lee, the Federal Circuit affirmed a PTAB finding without opinion.  Shore’s petition to the Supreme Court asks whether “the Federal Circuit’s affirmance without opinion of the PTO’s rejection of Petitioner’s patent application violate 35 U.S.C. § 144?”  In its first opportunity to support the Federal Circuit’s R.36 jurisprudence, the Department of Justice has passed – instead waiving its right to offer any argument in support.  The Supreme Court will consider the petition later this month.

Wrongly Affirmed Without Opinion: At the Supreme Court

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Similarly in Broadband ITV v. Hawaiian Telecom, respondents have waived their right to respond to Broadband’s challenge to quick-look eligibility denials.

Supreme Court: Challenging Quick-Look Eligibility Denials

Oil States: Trump Admin Supports AIA Trial Proceedings

Oil States v. Greene’s Energy (Supreme Court 2017).

After receiving party briefs in this case, the Supreme Court requested a responsive brief from the Michelle Lee in her role as PTO Director on the constitutionality of the AIA trial system.  That brief has now been filed by the new acting Solicitor General Jeff Wall who handled a number of patent cases in private practice.  Despite the regime change, the SG’s office continues to strongly support the AIA Trial system and the brief argues strongly that patents are public rights that may be subject to administrativ review:

Patents are quintessential public rights. Pursuant to its constitutional authority to “promote the Progress of Science and useful Arts” by establishing a patent system, U.S. Const. Art. I, § 8, Cl. 8, Congress created the USPTO, an agency with “special expertise in evaluating patent applications.” Kappos v. Hyatt, 566 U.S. 431, 445 (2012). Congress directed that agency to issue a patent if “it appears that the applicant is entitled to a patent” under standards set by federal law, 35 U.S.C. 131. Patents accordingly confer rights that “exist only by virtue of statute.” Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225, 229 n.5 (1964). . . . Petitioner’s constitutional arguments do not warrant this Court’s review.

[Read the Brief: 16-712_oil_states_energy_servs._llc_opp]  The Supreme Court has already denied certiorari in three prior constitutional challenges to the AIA trial mechanisms. MCM Portfolio v. Hewlett-Packard; Cooper v. Lee; and Cooper v. Square.  If Oil States is denied here, there are also several more cases waiting in the wings to raise the challenge again.

Oil States Energy Services v. Greene’s Energy Group

Federal Circuit Refuses to Hear Private Right Issue

by Dennis Crouch

Cascades Projections v. Epson America (Fed. Cir. 2017) (en banc denial)

In a split decision, the Federal Circuit has denied Cascades petition for initial en banc hearing.  The petition asked one question: “Whether a patent right is a public right.” Because a Federal Circuit panel already decided this decision in MCM, Cascades asked the court to bypass the initial panel appeal and head straight to the en banc question.  See MCM Portfolio LLC v. Hewlett-Packard Co., 812 F.3d 1284 (Fed. Cir. 2015), cert. denied 137 S. Ct. 292 (2016).  The issue is important because the answer to the private right question could lead to a judgment that the administrative patent trial system is an unconstitutional violation of due process rights.  I previously discussed the case on Patently-O.

Whether a Patent Right is a Public Right

 

For judges wrote separately on the case:

Judge Newman Concurring in Denial: The important question here is “whether the statutory scheme created by the America Invents Act, in which the Office is given an enlarged opportunity to correct its errors in granting a patent, with its decision subject to review by the Federal Circuit, meets the constitutional requirements of due process in disposition of property.”  Judge Newman suggests that she would vote for re-hearing after “full opportunity for panel rehearing.”

Judge Dyk (Joined by Judges Prost and Hughes) Concurring in the Denial: “MCM was correctly decided. . . . [T]here is no inconsistency in concluding that patent rights constitute property and that the source of that property right is a public right conferred by federal statute.”

Judge O’Malley, Dissenting from the Denial: Patent rights are likely “core private rights only subject to adjudication in Article III courts.”

Judge Reyna, Dissenting from the Denial: “The state of current law compels en banc review.”   According to Judge Reyna, the clear statement from Supreme Court’s 1898 decision in McCormick Harvesting that “The only authority competent to set a patent aside, or to annul it, or to correct it for any reason whatever, is vested in the courts of the United States, and not in the department which issued the patent.” McCormick Harvesting Mach. Co. v. C. Aultman & Co., 169 U.S. 606, 609 (1898).

We’ll look for the upcoming panel decision in the case and subsequent en banc hearing.

 

 

Court-Agency Allocations of Power and the Limits of Cuozzo

Guest post by Saurabh Vishnubhakat, Associate Professor at the Texas A&M University School of Law and the Texas A&M College of Engineering.  Although Prof. Vishnubhakat was an advisor at the USPTO until June, 2015, his arguments here should not be imputed to the USPTO or to any other organization.

Prof. Vishnubhakat was counsel of record for the amicus brief by patent and administrative law professors in this case.

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Yesterday’s argument in Wi-Fi One, LLC v. Broadcom Corp. suggested that the en banc Federal Circuit are grappling with at least three important issues as they consider the reviewability of PTO decisions to institute inter partes review that arguably violate the one-year bar of 35 U.S.C. § 315(b):

  • How does the IPR statute allocate power between the PTAB and the district courts to reevaluate patent validity?
  • How does the Supreme Court’s opinion last Term in Cuozzo Speed Techs., LLC v. Lee allocate power between the USPTO Director and the Federal Circuit to oversee the PTAB?
  • How might this case resolve (or aggravate) rule-of-law concerns that the Federal Circuit has recently expressed, especially as to separation of powers under the Chenery doctrine?

The Federal Circuit’s panel decision in Achates Reference Publ’g, Inc. v. Apple Inc. held that PTAB decisions to institute IPR are unreviewable even where the § 315(b) time bar may have been violated.  The en banc question here is whether to overrule Achates.

The USPTO’s interest in the case was clear from the large group of agency employees in attendance, including members of the PTAB and the Solicitor’s Office as well as Director Michelle Lee herself.  The USPTO also formally intervened in the case and designated Mark Freeman from the DOJ Civil Division’s Appellate Staff to argue.

The PTAB-District Court Balance of Power

Historically, of course, the power to invalidate patents in the first instance resided in the district courts.  An opening exchange with Chief Judge Prost laid the groundwork that although the AIA sought efficient patent validity review outside the courts, it also constrained the administrative alternatives in a variety of ways.  The USPTO would later elaborate this point as well, that challenges that would have gone to court would now go to the agency, but this reallocation of power would not be total.  District-court defendants and their privies would have to act within a year, or never at all.  Judicial review can police this balance of power—but not without disruption of its own, and so the dispute over appealability.

The Main Cuozzo Exception: Relatedness to Institution

From early in Wi-Fi’s argument, several members of the court starting with Judge Dyk explored whether the § 315(b) time bar is distinguishable from the § 312(a)(3) particularity requirement that was found nonappealable in Cuozzo.  A well-known passage in Cuozzo orients the holding toward institutions that are made “under this section [§ 314]” or that are “closely tied” to institution-related statutes.  Meanwhile, several types of “shenanigans” may still merit review, such as constitutional defects, interpretations of less closely related provisions, or decisions whose scope and impact reach well beyond institution.  As a result, arguments to limit Cuozzo and afford review have often focused on these exceptions, especially on framing the statute as “less closely related” to institution “under this section [§ 314].”  Judges Chen and Stoll also followed up at several points with Broadcom and the USPTO about the “under this section” limitation.

Reconciling Cuozzo’s Majority and Dissent

Judge Chen also took an interesting further approach to how closely related a statute must be for Cuozzo to apply.  He noted that the dissent in Cuozzo complained specifically that the majority’s approach swept broadly and harmfully.  The Cuozzo dissent argued that the majority’s position would foreclose review even of issues such as the § 315(b) time bar because timeliness is “no less . . . closely tied” to institution.  The majority disclaimed various other horribles but was silent about the alleged relatedness of the one-year bar to institution.  Was this colloquy from Cuozzo a signal of consensus that the time bar is, indeed, the type of PTAB decision that is immune from review?

One sensible answer is that the Cuozzo dissent’s argument about the one-year bar should be seen as hortatory, intended first to build a majority and later, when the case was lost, to cabin the impact of the majority’s reasoning.  In other words, the dissent did not merely read the majority’s logic broadly but read it broadly as a reason to reject that logic.  To accept part of the Cuozzo dissent’s premise now while continuing to reject the dissent’s urged conclusion may itself be problematic cherry-picking, especially if any supposed agreement by the Cuozzo majority were to be inferred from its silence on the matter.  Indeed, Wi-Fi answered Judge Chen along just these lines by discussing what the Cuozzo dissent was trying to accomplish—limiting nonappealability to a prohibition of interlocutory review—not merely what the dissent said.

The Other Cuozzo Exception: Scope and Impact

Apart from “less closely related” statutes, the argument also started at times to explore Cuozzo’s “scope and impact” exception, particularly where the PTAB might act outside its statutory authority and thereby lose immunity from review.  It was the USPTO to whom Judge Chen suggested that the one-year bar of § 315(b) may well have been a Congressional allocation of power between the agency and the district courts to resolve patent validity disputes.  This view of the time bar would make it a statutory limit on the agency’s authority, a violation of which would render the PTAB susceptible to appellate review despite Cuozzo.

The scope and impact of § 315(b) are also stark when seen through the lens of court-agency substitution.  Arti Rai, Jay Kesan, and I have reported in recent research that a substantial share of petitioners (about 30%) seek PTAB review before being sued in district court on the patent in question.  This and related findings indicate that, in addition to ordinary court-agency competition over who resolves the validity of a patent in an ongoing infringement lawsuit, the PTAB also competes with the courts over who should resolve preemptive strikes against patents.  As the law professors’ amicus brief argued in this case, the one-year bar of § 315(b) sets an important boundary line in this competition and—as Judge Chen suggests—preserves an inter-branch allocation of power.  Thus, its scope and impact reach well outside the walls of the agency and into the federal courts, empirically as well as analytically.

The USPTO Director-Federal Circuit Balance of Power

One of the most significant aspects of this case, and why it was an apt choice for en banc review, is that the Federal Circuit is shaping its own ability to shape future cases.  Much like the balance of power between the PTAB and the district courts to evaluate patent validity in the first instance, also at stake is the power to correct errors and bring uniformity to the decision-making of the PTAB.  This latter power, too, was reallocated away from the Federal Circuit by the AIA’s nonappealability provisions.

The Source(s) of Uniformity

One might suppose, as Wi-Fi began to argue, that the absence of judicial oversight would leave individual PTAB panels to generate consensus in a common law fashion, and that consensus is unlikely to emerge because of the PTAB’s sometime disregard for its own prior analogous precedents and for prior court judgments regarding the validity of the same patent.  (Even a Federal Circuit panel endorsed the latter as recently as a month ago in Novartis AG v. Noven Pharms. Inc.)

Judge Wallach, however, strongly rejected Wi-Fi’s view that nonreviewability might leave uniformity and oversight to individual panels of the PTAB.  Instead, he noted, the Director of the USPTO can impose uniformity by assigning additional judges to particular panels to resolve contentious issues in a certain way.  To this, one might add that the Director can also generate uniformity directly through the ordinary chain of administrative command as an ex officio member of the PTAB and through the process for designating PTAB opinions as precedential, representative, or informative.  Judge Wallach raised the issue with Broadcom as well, asking whether “stacking the panel” to reach certain outcomes would qualify as judicially reviewable shenanigans.

This alternate view of uniformity is significant for its implicit but direct potential not only for displacing the Federal Circuit but also for making patent validity decisions more responsive to political constituencies.

The APA Presumption of Reviewability

The counterargument to this potential injection of politics into patent adjudication came in the closing minutes of the hearing.  For all the discussion about Cuozzo and its enumerated exceptions, Wi-Fi argued that the Cuozzo holding did not make nonreviewability the new baseline in administrative reviews of patent validity.  Rather, Cuozzo was one instance where the Administrative Procedure Act’s ever-present presumption favoring judicial review was rebutted clearly and convincingly enough as to institution decisions.  To construe the nonappealability statute as to timeliness under § 315(b) or any other issue would require a fresh analysis of statutory text, purpose, legislative history, etc.

Judge Moore engaged this argument, suggesting that Cuozzo need not be limited entirely to its facts with nonappealability decided from scratch each time.  She suggested, for example, that Cuozzo could be seen as precluding a range of appeals from institution and institution-related decisions, but that the opinion’s limitations apply here and thus dispel the indications that were clear and convincing in the Cuozzo case itself.

Notably, Judge Moore was also one of several, including Judges Newman and Reyna, to ask whether PTAB actions that are plainly invalid or ultra vires would enjoy immunity from review.  This concern, too, is of a piece with the balance of power between the Federal Circuit as judicial overseer and the Director of the USPTO as political overseer because it highlights a necessary choice between correcting agency errors and tolerating them in the name of Congressionally intended agency autonomy.

Making the PTAB Better Explain Itself

Finally, the en banc court referred at various points to the need for greater transparency in the PTAB’s own decision-making.  This is a concern that Federal Circuit panel decisions increasingly voice in PTAB appeals.  An early colloquy with Chief Judge Prost explored whether the PTAB might be shielded from review of certain issues in final written decisions simply by omitting discussion of those issues from its final written decisions, in light of the APA’s general requirement that an agency articulate its “findings and conclusions, and the reasons or basis therefor.”  Similarly, in the discussion over political panel-selection by the USPTO Director, Judge Wallach suggested that rule-of-law values such as predictability, uniformity, and transparency of judgments and the neutrality of decision-making may be threatened.

These concerns are also consistent with recent decisions finding fault with the PTAB’s failure to explain its reasoning with enough detail even to enable meaningful review.  For example, citing the Chenery doctrine, the In re NuVasive, Inc. panel decision last December reversed a finding of obviousness not because it was necessarily wrong, but because the reasoning that the PTAB had articulated could not support the decision, while the separation of powers forbade the Federal Circuit to supply its own rationale.  Similarly, in the Shaw Indus. Group., Inc. v. Automated Creel Sys., Inc. panel decision early last year, Judge Reyna wrote separately to chastise the USPTO for its opaque practice of making partial institutions while denying certain grounds or prior art as “redundant.”

Conclusion

The opportunity to clarify these allocations and reallocations of power is likely to be a welcome aspect of en banc consideration.  The power in question may be to adjudicate (as between the PTAB and the district courts), to oversee (as between the USPTO Director and the Federal Circuit), or simply to force a clearer account of the PTAB’s own reasoning.  All of these powers have seen significant revision under the AIA, reflecting the more general ascendancy of administrative adjudication in patent law.  In seeking the right balance for each of these powers, the Federal Circuit appears to be taking seriously the warning that “no legislation pursues its purposes at all costs” and that if the goals of the AIA are important, so also are the particular means that Congress enacted to achieve those goals.

Case Information

  • Oral Argument Recording
  • En Banc Panel: Prost, Newman, Lourie, Bryson, Dyk, Moore, O’Malley, Reyna, Wallach, Taranto, Chen, Hughes, Stoll
  • Arguing for Appellant Wi-Fi One, LLC: Douglas A. Cawley (McKool Smith)
  • Arguing for Appellee Broadcom Corporation: Dominic E. Massa (WilmerHale)
  • Arguing for Intervenor Michelle K. Lee, Director of the USPTO: Mark R. Freeman (DOJ Civil Division, Appellate Staff)

Wrongly Affirmed Without Opinion: At the Supreme Court

Shore v. Lee (Supreme Court 2017)

In a new petition for writ of certiorari, patent attorney and inventor Michael Shore has challenged the propriety of the Federal Circuit’s continued approach of affirming patent office decisions without opinion. In a forthcoming article titled “Wrongly Affirmed Without Opinion” (Wake Forest Law Review), I raise the previously unnoticed requirement of 35 U.S.C. § 144 that the Federal Circuit issue an opinion in appeals from the Patent Office (PTO).  Although the Supreme Court generally permits its lower appellate courts to issue summary affirmances, I argue that the Patent and Trademark statutes take precedence in this particular situation.  The issue has come to a head with the large number of no-opinion judgments being issued by the court since the creation of the system of administrative patent trials (IPR/PGR/CBM).

Running with that argument, Shore raises the following three questions:

  1. Does the Federal Circuit’s affirmance without opinion of the PTO’s rejection of Petitioner’s patent application violate 35 U.S.C. § 144?
  2. Does the statute’s requirement that the Federal Circuit issue a “mandate and opinion” govern over Federal Rule of Appellate Procedure 36’s general permission for appellate courts to render judgment without opinion?
  3. Assuming that the Federal Circuit can issue an affirmance without opinion despite the language of § 144, does the Federal Circuit act within its discretion by issuing an affirmance without opinion that does not meet any of the criteria listed in Fed. Cir. R. 36(a)-(e)?

[Read the petition: 2017_WL_1406097]

Certainly, if the PTAB had issued its judgment without opinion, the Federal Circuit would have immediately vacated that decision. However, the appellate court suggests that the rules of opinion writing should not be self applied.

In the underlying case, Shore’s patent application (with co-inventor Charles Attal – founder of Austin City Limits Festival) covers a method for creating a custom video track of a live musical performance.  The claims were rejected as obvious – affirmed by the PTAB.  On appeal, Shore raised several challenges regarding both interpretation of the prior art and claim construction.  Rather than working through those arguments, the Federal Circuit simply affirmed without opinion.

Supreme Court: Challenging Quick-Look Eligibility Denials

by Dennis Crouch

Broadband ITV v. Hawaiian Telecom (Supreme Court 2017)

A newly filed petition for writ of certiorari offers a substantial challenge to the quick-look eligibility decisions that have been so popular among district courts.  The challenge here is especially focused on no-evidence eligibility decisions that serve as a substitute for an obviousness determination.

In the case, the claims of BBiTV’s U.S. Patent No. 7,631,336 have been repeatedly upheld as non-obvious before a Hawaii district court ruled them ineligible on summary judgment.  In its 103 analysis, the Hawaii court also denied summary judgment of obviousness – finding questions of material fact regarding whether (1) elements of the claims were found in the prior art or (2) PHOSITA would have been motivated to combine those elements.  In its simultaneous 101 decision, however, the court determined as a matter of law that those same elements were “well-understood, routine, conventional activities previously known to the industry” that lack the “inventive concept” required by Alice.  The decision was (as is now common) affirmed without opinion by the Federal Circuit.

The petition challenges the decision and the newly-popular approach of using eligibility as a shortcut to more difficult and fact-intensive obviousness analysis. The three three questions:

1. Evidence for Underlying Factual Findings: Whether the statutory presumption of validity set forth in 35 U.S.C. § 282 applies to claims challenged under 35 U.S.C. § 101, as set forth by this Court in Microsoft Corp. v. i4i L.P., 564 U.S. 91 (2011), when the ultimate legal conclusion relies upon underlying findings of fact, such as whether the additional novel and non-obvious elements of the claims are merely well-understood, routine, and conventional or whether they add an inventive concept.

2. Standard for Summary Judgment: Whether, unlike every other area of law involving motions for summary judgment, as set forth by Fed. R. Civ. P. 56 and Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986), and its progeny, a district court may resolve material underlying fact disputes against the non-movant party on a summary judgment motion for lack of patent-eligibility under § 101.

3. Not All Abstraction Are Abstract: Whether the judicially-created exception for “abstract ideas” broadly includes any abstraction of a claim (including novel business practices or methods of organizing human activities) or only “fundamental” and “long-standing” (i.e., pre-existing) practices and methods, as recognized by this Court in Bilski v. Kappos, 561 U.S. 593, 611 (2010) and Alice Corp. Pty. v. CLS Bank Int’l, 134 S. Ct. 2347, 2356- 57 (2014).

The questions begin with the implicit understanding that, although a question of law, eligibility decisions are based upon a set of factual determinations that should be treated like any other factual determination by the court.  This approach is directly contrary to the approach often taken these days that follows Judge Mayer’s concurring opinion in Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014).

An important legal question here is how close the link should be between obviousness and eligibility.  Post-KSR and Alice, there does appear to be substantial connection between the obviousness analysis associated with combining-old-elements and the eligibility analysis of elements that are “well-understood, routine, and conventional.”  The two should often correlate, the court here may have the opportunity to explain the differences both in doctrine and procedure.

Read the petition here: [LINK]

Amicus Briefs in support of the Petition are due by May 17, 2017.

 

Supreme Court Affirms Causal Requirement for Sanctions under Inherent Power

In patent litigation, as in all civil litigation, district courts have various means to impose sanctions for litigation misconduct.  Rule 11, Rule 37, Section 1927, and, of course, Section 285 are rule- or statutorily-based means to impose costs on those who litigate improperly.

Federal courts also have the “inherent power” to impose sanctions even if one of those rules or statutes is not violated.  But, because it is judicial in nature and cannot be used to swallow the rule, inherent power has long been somewhat cabined. Among other things, the Court has always held that any sanctions imposed must be causally related to the misconduct.

The Court affirmed that requirement in a non-patent case, Goodyear Tire & Rubber Co. v. Haeger (Apr. 18, 2017).  In that case, Goodyear engaged in a years-long effort to hide key documents from the plaintiffs, who, not knowing of them, settled the case.  When they sought sanctions, the district court awarded all of the litigation fees the plaintiff had incurred from the time when the scheme had begun:  $2.7 million.  It also held, conditionally, that $2 million was caused directly by the shenanigans.

The Ninth Circuit affirmed, but the Court reversed, unanimously.  It reiterated that in some cases — such as when the entire defense or entire claim are brought in bad faith — a shifting of all fees is proper, but found that was not the case here.  Instead, unable to discern if the $2 million conditional award was appropriate, it remanded for the courts below to decide what amount had actually been caused by Goodyear’s misconduct.

Section 285 is often the myopic focus of patent litigators.  While the Goodyear opinion confirms the causation requirement of inherent power, it also should remind litigators to think of all available means to seek compensation for improper litigation conduct.

Supreme Court Cheers on Copyright Separability

Screen-Shot-2016-05-02-at-2.27.31-PM1[1]by Dennis Crouch

Star Athletica v. Varsity Brands (Supreme Court 2017)

In a new Copyright decision, the Supreme Court has modified the doctrine of separability that allows for copyright of works of authorship associated with useful articles.

Under the statute:

The design of a useful article … shall be considered a [copyrightable] pictorial, graphic, or sculptural work only if, and only to the extent that, such design incorporates pictorial, graphic, or sculptural features that can be identified separately from, and are capable of existing independently of, the utilitarian aspects of the article.

17 USC 101.  Interpreting that statute, the Court here holds that the statute requires that an ‘artisitc feature’ of a useful article may be copyrighted:

if the feature (1) can be perceived as a two- or three-dimensional work of art separate from the useful article and (2) would qualify as a protectable pictorial, graphic, or sculptural work either on its own or in some other medium if imagined separately from the useful article.

In walking through this, the court held that two-dimensional surface decorations will not always be separable, but the ‘artwork’ applied to the cheerleader uniforms at issue here did pass the test.

The Star Athletica decision will further blur the line between the intellectual property spheres and savvy IP strategists will continue to layer overlapping IP rights.  A challenging aspect of the decision will be the “work of art” requirement.

Read the Decision: 15-866_0971

Life Tech v. Promega: Supreme Court Limits Contributory Liability for Exports

Life Technologies Corp. v. Promega Corp. (Supreme Court 2017)

In a largely-unanimous opinion, the Supreme Court has ruled that the “supply of a single component of a multicomponent invention for manufacture abroad does not give rise to §271(f)(1) liability.”

The case interprets the patent infringement statute 35 U.S.C. §271(f)(1) that creates liability for supplying from the US “all or a substantial portion of the components of a patented invention” to be combined abroad in a manner that would infringe the US patent (if it had been combined in the US).  The patent covers a genetic testing kit that includes five different components.  The accused infringement was shipping one component of the kit (Taq polymerase) to the UK for combination with the other components. The Federal Circuit had ruled that a single component could constitute a “substantial portion of the components” under the statute.

Writing for the court, Justice Sotomayor found that the “substantial portion” should be seen as a quantitative requirement and that a single component is not sufficient.

Although they joined with the bulk of the opinion, Justices Alito and Thomas did not join the portion suggesting that 271(f) was intended as a narrow provision enacted by congress only to fill the gap left by Deepsouth Packing Co. v. Laitram Corp., 406 U. S. 518 (1972).  Rather, in a concurring opinion, justice Alito writes that congress intended “to go at least a little further.”  The concurrence also includes its interpretative statement on the majority opinion:

I note, in addition, that while the Court holds that a single component cannot constitute a substantial portion of an invention’s components for §271(f)(1) purposes, I do not read the opinion to suggest that any number greater than one is sufficient. In other words, today’s opinion establishes that more than one component is necessary, but does not address how much more.

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Supreme Court Update: Are Secondary Indicia of Invention Relevant to Eligibility?

by Dennis Crouch

The Supreme Court is on recess until Feb 17.

I don’t know if my end-of-April prediction will hold true, but I do expect Neil Gorsuch to become a Justice on the United States Supreme Court.  As a 10th Circuit Judge, Gorsuch never decided a patent case, but does have a handful of interesting IP cases.

There are a few petitions filed that we have not discussed here: 

 In its newest petition, DataTreasury takes 101 for a new spin by taking the 101/103 analysis to its next logical level.  If we are going to include a 103 analysis as part of the eligibility doctrine then lets go whole hog.  Thus, DataTreasury asks: whether a court must consider secondary indicia of invention as evidence in its eligibility analysis? In the case, the Federal Circuit had affirmed the PTAB judgment without opinion under R.36. A second eligibility petition is found in TDE Petroleum Data Solutions, Inc. v. AKM Enterprise, Inc., dba Moblize, Inc. TDE asks the court to “please reconcile Diehr and Alice.” (I’m not literally quoting here).  The patent at issue (No. 6,892,812) claims a four-step process of “determining the state of a well operation.” (a) store several potential “states”; (b) receive well operation data from a plurality of systems; (c) determine that the data is valid by comparing it to a threshold limit; and (d) set the state based upon the valid data.

In Wi-LAN v. Apple, the patentee revives both Cuozzo and Markman claim construction arguments – this time focusing on “whether claim terms used to define the metes and bounds of an invention are generally given their “plain and ordinary meaning,” or are redefined (limited) to match the scope of the exemplary embodiments provided in the specification.”

duPont v. Macdermid asks whether summary judgment of obviousness is proper because of the factual disputes at issue.  Similarly, in Enplas v. Seoul Semiconductor, the petitioner argues that a finding of anticipation by the PTAB must be supported by findings each and every element of the subject patent claim is disclosed in the prior art.  In Enplas, the Federal Circuit affirmed the PTAB on a R.36 Judgment Without Appeal — it difficult for the petitioner to point to the particular deficiencies.

 

=== THE LIST===

1. 2016-2016 Decisions:

  • Design Patent Damages: Samsung Electronics Co. v. Apple Inc., No 15-777 (Total profits may be based upon either the entire product sold to consumers or a component);  GVR order in parallel case Systems, Inc. v. Nordock, Inc., No. 15-978.  These cases are now back before the Federal Circuit for the job of explaining when a component

2. Petitions Granted:

3. Petitions with Invited Views of SG (CVSG): 

4. Petitions for Writ of Certiorari Pending:

  • Claim Construction: Wi-LAN USA, Inc., et al. v. Apple Inc., No. 16-913 (“plain and ordinary meaning”)
  • Is it a Patent Case?: Boston Scientific Corporation, et al. v. Mirowski Family Ventures, LLC, No. 16-470 (how closely must a state court “hew” federal court patent law precedents?) (Appeal from MD State Court)
  • Anticipation/Obviousness: Google Inc., et al. v. Arendi S A.R.L., et al., No. 16-626 (can “common sense” invalidate a patent claim that includes novel elements?) (Supreme Court has requested a brief in response)
  • Anticipation/Obviousness: Enplas Corporation v. Seoul Semiconductor Co., Ltd., et al., No. 16-867 (“Whether a finding of anticipation under 35 U.S.C. § 102 must be supported by findings that each and every element of the subject patent claim is disclosed in the prior art?”)
  • Anticipation/Obviousness: E.I. du Pont de Nemours and Company v. MacDermid Printing Solutions, L.L.C., No. 16-905 (summary judgment of obviousness proper)
  • Jury Trial: Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, et al., No. 16-712 (“Whether inter partes review … violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.”) [oilstatespetition]
  • Jury Trial: Nanovapor Fuels Group, Inc., et al. v. Vapor Point, LLC, et al., No. 16-892 (Can a party forfeit a properly demanded trial by jury without an explicit, clear, and unequivocal waiver?)
  • Is it a Patent Case?: Big Baboon, Inc. v. Michelle K. Lee, No. 16-496 (Appeal of APA seeking overturning of evidentiary admission findings during reexamination – heard by Federal Circuit or Regional Circuit?)
  • LachesMedinol Ltd. v. Cordis Corporation, et al., No. 15-998 (follow-on to SCA); Endotach LLC v. Cook Medical LLC, No. 16-127 (SCA Redux); Romag Fasteners, Inc. v. Fossil, Inc., et al, No. 16-202 (SCA Redux plus TM issue)
  • Eligibility: TDE Petroleum Data Solutions, Inc. v. AKM Enterprise, Inc., dba Moblize, Inc., No. 16-890 (Please reconcile Diehr and Alice)
  • Eligibility: DataTreasury Corporation v. Fidelity National Information Services, Inc., No. 16-883 (secondary indicia as part of eligibility analysis).
  • Eligibility: IPLearn-Focus, LLC v. Microsoft Corp., No. 16-859 (evidence necessary for finding an abstract idea)

5. Petitions for Writ of Certiorari Denied or Dismissed:

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Apple Samsung: Federal Circuit Remands Design Patent Damages Decision to District Court

iphonedesignpatentimageBy Dennis Crouch

Apple v. Samsung (Fed. Cir. 2017)

In a non-precedential decision, the Federal Circuit has remanded this design patent damages dispute back to the district court reconsideration.  The basic question is whether the patented “article of manufacture” (which serves as the basis for profit disgorgment) should be the entire article sold to consumers or some component of that whole.  A patentee would obviously prefer the whole-article basis because it would result in a greater total-profit award. In Samsung Elecs. Co. v. Apple Inc., 137 S. Ct. 429 (2016), the Supreme Court held that the statute is broad enough to encompass either the entire-article or simply a component.  However, the Court refused to provide any guidance as to how to determine the appropriate basis in any particular case (including this case involving Apple’s iPhone design patents).

On remand here, the Federal Circuit has also refused to particularly decide the case but instead has remanded to the District Court for her analysis.  “[W]e remand this case to the district court for further proceedings, which may or may not include a new damages trial.”

The court did provide some commentary:

The Supreme Court clarified that a damages award under § 289 involves two steps: (1) “identify the ‘article of manufacture’ to which the infringed design has been applied;” and (2) “calculate the infringer’s total profit made on that article of manufacture.”

The parties here dispute whether the jury instructions were appropriate based upon this clarification of the law.   Apparently, Judge Koh read the statute to the jury, and did not particularly indicate whether the “article of manufacture” was the phone as a whole or some component thereof.  So, while the instructions are not wrong, they could be more detailed.

On remand, the District Court will need to review the trial record and determine whether a new damages trial is necessary based upon more detailed jury instructions.

= = = = =

I like what the court did here.  When the Federal Circuit does decide this issue, its precedential approach is likely to stick for many years to come.  It makes sense then for the court to seek the perspective of at least one other judge before jumping into the foray.  Here, there is no question that the district court more fully understands the case and the particulars of the trial and so it is also right to remand for consideration of how the Supreme Court’s decision impacts what has already been decided. We can also recognize that the parties are fighting over past damages and both have sufficient cash-on-hand so that a delay in judgment does not create irreparable harm.

= = = = =

In a Footnote, the court looked to foreclose a separate argument on remand. The court writes:

Samsung also argued that § 289 “contains a causation requirement, which limits a § 289 damages award to the total profit the infringer made because of the infringement.” We rejected that argument, and Samsung abandoned this theory during oral argument to the Supreme Court.

Thus, although causation may still be an issue to be debated – it appears out for this case.

Supreme Court 2017 – Patent Preview

by Dennis Crouch

A new Supreme Court justice will likely be in place by the end of April, although the Trump edition is unlikely to substantially shake-up patent law doctrine in the short term.

The Supreme Court has decided one patent case this term. Samsung (design patent damages).  Five more cases have been granted certiorari and are scheduled to be decided by mid June 2017. These include SCA Hygiene (whether laches applies in patent cases); Life Tech (infringement under 35 U.S.C. § 271(f)(1) for supplying single component); Impression Products (using patents as a personal property servitude); Sandoz (BPCIA patent dance); and last-but-not-least TC Heartland (Does the general definition of “residence” found in 28 U.S.C. 1391(c) apply to the patent venue statute 1400(b)).

Big news is that the Supreme Court granted writs of certiorari in the BPCIA dispute between Sandoz and Amgen.   The BPCIA can be thought of as the ‘Hatch Waxman of biologics’ – enacted as part of ObamaCare.   The provision offers automatic market exclusivity for twelve years for producers of pioneer biologics.   Those years of exclusivity enforced by the FDA – who will not approve a competitor’s expedited biosimilar  drug application during the exclusivity period.   The statute then provides for a process of exchanging patent and manufacturing information between a potential biosimilar producer and the pioneer – known as the patent dance.  The case here is the Court’s first chance to interpret the provisions of the law – the specific issue involves whether the pioneer (here Amgen) is required to ‘dance.’ [Andrew Williams has more @patentdocs]

A new eligibility petition by Matthew Powers in IPLearn-Focus v. Microsoft raises eligibility in a procedural form – Can a court properly find an abstract idea based only upon (1) the patent document and (2) attorney argument? (What if the only evidence presented supports eligibility?).  After reading claim 1 and 24 (24 is at issue) of U.S. Patent No. 8,538,320, you may see why the lower court bounced this. Federal Circuit affirmed the district court’s ruling without opinion under Federal Circuit Rule 36 and then denied IPLF’s petition for rehearing (again without opinion).

1. A computing system comprising:

a display;

an imaging sensor to sense a first feature of a user regarding a first volitional behavior of the user to produce a first set of measurements, the imaging sensor being detached from the first feature to sense the first feature, the first feature relating to the head of the user, and the first set of measurements including an image of the first feature, wherein the system further to sense a second feature of the user regarding a second volitional behavior of the user to produce a second set of measurements, the second feature not relating to the head of the user; and

a processor coupled to the imaging sensor and the display, the processor to:

analyze at least the first set and the second set of measurements; and determine whether to change what is to be presented by the display in view of the analysis.

24. A computing system as recited in claim 1, wherein the system capable of providing an indication regarding whether the user is paying attention to content presented by the display.

=== THE LIST===

1. 2016-2016 Decisions:

  • Design Patent Damages: Samsung Electronics Co. v. Apple Inc., No 15-777 (Total profits may be based upon either the entire product sold to consumers or a component);  GVR order in parallel case Systems, Inc. v. Nordock, Inc., No. 15-978.  These cases are now back before the Federal Circuit for the job of explaining when a component

2. Petitions Granted:

3. Petitions with Invited Views of SG (CVSG): 

4. Petitions for Writ of Certiorari Pending:

  • Is it a Patent Case?: Boston Scientific Corporation, et al. v. Mirowski Family Ventures, LLC, No. 16-470 (how closely must a state court “hew” federal court patent law precedents?) (Appeal from MD State Court)
  • Anticipation/Obviousness: Google Inc., et al. v. Arendi S A.R.L., et al., No. 16-626 (can “common sense” invalidate a patent claim that includes novel elements?) (Supreme Court has requested a brief in response)
  • Civil Procedure – Final Judgment: Johnson & Johnson Vision Care, Inc. v. Rembrandt Vision Technologies, L.P., No. 16-489 (Reopening final decision under R.60).
  • Anticipation/Obviousness: Enplas Corporation v. Seoul Semiconductor Co., Ltd., et al., No. 16-867 (“Whether a finding of anticipation under 35 U.S.C. § 102 must be supported by findings that each and every element of the subject patent claim is disclosed in the prior art?”)
  • Post Grant Admin: Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, et al., No. 16-712 (“Whether inter partes review … violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.”) [oilstatespetition]
  • Eligibility: IPLearn-Focus, LLC v. Microsoft Corp., No. 16-859 (evidence necessary for finding an abstract idea)
  • Post Grant Admin: SightSound Technologies, LLC v. Apple Inc., No. 16-483 (Can the Federal Circuit review USPTO decision to initiate an IPR on a ground never asserted by any party)
  • Is it a Patent Case?: Big Baboon, Inc. v. Michelle K. Lee, No. 16-496 (Appeal of APA seeking overturning of evidentiary admission findings during reexamination – heard by Federal Circuit or Regional Circuit?)
  • LachesMedinol Ltd. v. Cordis Corporation, et al., No. 15-998 (follow-on to SCA); Endotach LLC v. Cook Medical LLC, No. 16-127 (SCA Redux); Romag Fasteners, Inc. v. Fossil, Inc., et al, No. 16-202 (SCA Redux plus TM issue)
  • Eligibility and CBM: DataTreasury Corporation v. Fidelity National Information Services, Inc., No. 16-883 (I have not seen the petition yet, but underlying case challenged whether (1) case was properly classified as CBM and (2) whether PTAB properly ruled claims ineligible as abstract ideas) (Patent Nos. 5,910,988 and 6,032,137).

5. Petitions for Writ of Certiorari Denied or Dismissed:
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Supreme Court Grants Cert in Amgen v. Sandoz & Sandoz v. Amgen

By Jason Rantanen

Today, the Supreme Court granted certiorari in two dueling petitions involving the Federal Circuit’s 2015 interpretation of the Biologics Price Competition and Innovation Act of 2009.  Here are the questions presented:

Amgen v. Sandoz

(1) Whether a biosimilar applicant is required by 42 U.S.C. § 262(l)(2)(A) to provide the reference product sponsor with a copy of its biologics license application and related manufacturing information, which the statute says the applicant “shall provide;” and (2) whether, where an applicant fails to provide that required information, the sponsor’s sole recourse is to commence a declaratory judgment under 42 U.S.C. § 262(l)(9)(C) and/or a patent-infringement action under 35 U.S.C. § 271(e)(2)(C)(ii).

Sandoz v. Amgen

(1) Whether notice of commercial marketing given before Food and Drug Administration approval can be effective; and (2) whether, in any event, it is improper to treat Section 262(l)(8)(A) – the Biologics Price Competition and Innovation Act of 2009’s “Notice of commercial marketing” provision which states that a biosimilar applicant shall provide notice to the incumbent seller of the biological product “not later than 180 days before the date of the first commercial marketing of the biological product licensed under” an abbreviated pathway for biosimilars – as a stand-alone requirement and as creating an injunctive remedy that delays all biosimilars by 180 days after approval.

Kevin Noonan discussed the underlying opinion on the PatentDocs blog, describing it as “a seriously fractured decision….”

You can read the Federal Circuit opinion here:  s15-1499

More Pressure on Texas Supreme Court to Enforce Ethical Rules Despite Arbitration Clauses

Dennis wrote about this case involving Jenner & Block and Parallel Networks on the main page, and I was an expert in the underlying case for the client.  Boiled down, Jenner agreed to represent Parallel Networks on a contingent fee.  The firm got upset when the client fell behind on expenses, and the client paid up.  Then the firm lost  on summary judgment, and dumped the client.

The law in Texas is pretty clear that there’s a big distinction between whether you can quit a case — withdrawal — and whether you can quit a case and be paid.  The former is pretty narrowly circumscribed but the latter is severely so:  without “just cause” you lose any right to any money.  Makes sense, otherwise a contingent fee is illusory:  I get in a case, and it’s a loser, I withdraw but still get paid.  Undermines the entire notion of contingent fees.

Although Jenner gave up on its client’s case, the client didn’t.  But the client had to pay another firm hourly fees to handle the appeal and get the case out of the ditch into which Jenner had put it, and left it.

Then that firm (my old firm, Baker Botts), turned the case around on appeal,  resulting in settlement money.

Believe it or not, Jenner then demanded that — even though it had left its own client in the ditch to fend for itself — because of the contingent fee agreement, it was entitled to its fully hourly fees. Yes, full hourly fees because supposedly that’s what the agreement provided.  The arbitrator awarded the firm some money, but not full hourly fees.  The agreement is quite something to read and Jenner pointed out that the client had used it in another case (long story), and so, presumably, was the cause of any unethical provisions in it.  (Think on that.)

The Texas courts have, so far, refused to even examine the merits  of the award because, supposedly, the Federal Arbitration Act precludes review unless the award was fraudulent, etc.

As you can imagine, the prevailing notion in Texas that we’ve outsourced ethics to arbitrators (aka, lawyers), and as a result insulated their decisions from review by the judiciary — supposedly independent and constitutionally charged in many states with enforcing ethics —  has caused some people to wonder about what is wrong in Texas courts.  If anything, the Texas Supreme Court should say, clearly:  “if there’s an arbitration clause it will be enforced even if the conduct is unethical because that’s what the FAA requires,” so the Supreme Court can take corrective action.

The latest amicus brief is here.  Dennis’ post which links to my earlier one, is here.

I don’t mean to be flippant but, the way things stand, suppose you hire a hit man and, being the good lawyer you are, you include an arbitration clause in your written agreement. He then decides it’s not right to murder someone. So you bring an arbitration proceeding for damages. Hooray for you.  That arbitrator is free to ignore public policy saying that contract is no good, and make then hitman pay, and a Texas court will enforce the award.  Yes, a silly example and obviously extreme, but that’s where Texas now is. It’s obviously wrong, seriously misguided, and needs to be corrected by that court or the one above it.

Supreme Court Patent Cases: Post Sale Exhaustion

by Dennis Crouch

Substantive Patent Law: Newly filed petition in Merck & Cie v. Watson Labs raises a core substantive patent issue – does the on sale bar apply to secret sales? The defendant asks:

Whether the “on sale” bar found in § 102(b) applies only to sales or offers of sale made available to the public, as Congress, this Court, and the United States have all made clear, or whether it also applies to non-public sales or offers of sale, as the Federal Circuit has held.

The Merck petition is focused on pre-AIA patents.  The PTO (and patentees) are arguing more forcefully that the AIA certainly intended to exclude secret sales from the scope of prior art in cases now pending before the Federal Circuit.

The second new substantive patent law case is Google v. Arendi that challenge’s the Federal Circuit’s limitations on the use of common sense in the obviousness analysis.  In its decision, the Federal Circuit limited KSR to combination patents and held that “common sense” cannot be used to supply missing limitations.  Google argues that the Federal Circuit’s approach is contrary to the broad and flexible obviousness analysis required by KSR.  Patentees bristle term “common sense” – they see an overly flexible analysis as providing opportunities to invalidate patents without evidence.  The question: “Did the Federal Circuit err in restricting the Board’s ability to rely on the common sense and common knowledge of skilled artisans to establish the obviousness of patent claims?”

As these new petitions were being filed, the Supreme Court has also denied the pending obviousness, anticipation, and eligibility petitions.  In addition, Cooper v. Square has also been denied.

Civil Procedure: In J&J v. Rembrandt, the defendant J&J won at trial. However, Rembrandt later learned that J&J’s expert had testified falsely and the Federal Circuit ordered the case re-opened under R.60(b)(3) that empowers district courts to revisit final judgments after a showing of “fraud …, misrepresentation, or misconduct by the opposing party.”  The various circuits follow different standards and procedures for analyzing process and J&J has asked the Supreme Court to reconcile these (in its favor).  Another CivPro petition was also filed by Eon Corp that questions whether an appellee needed to file a R.50 JMOL motion to overturn a jury verdict that was based upon a faulty legal conclusion by the district court (here claim construction).  The Question Presented is:

Whether the Federal Circuit erred in ordering entry of judgment as a matter of law on a ground not presented in a Rule 50 motion in the district court, even though the ground presented a purely legal question.

Both J&J and Eon are only marginally patent cases, the core procedure case now pending is TC Heartland that would substantially upset the status quo of patent lawsuit concentration in E.D. Texas. Briefing continues in TC Heartland. In recent weeks a set of seven amici briefs were filed on the top side.

Next week Supreme Court conference includes review of the most likely-to-be-granted petition of Impression Products, Inc. v. Lexmark International, Inc. that focuses on important questions of post-sale exhaustion of patent rights.  The setup – If I buy a used product that was made and sold by the patentee, do I still need to worry that I might get sued for patent infringement?  The Federal Circuit says yes. The Supreme Court is likely to add some caveats to that.  The US Government (Obama Administration via DOJ) has argued that the case should be reviewed and that the Federal Circuit’s position should be rejected. Both parties then filed supplemental responsive briefs.  Lexmark’s best argument here is that these principles are well settled and that Congress can take on the role of tweaking them if needed.

Upcoming Supreme Court Oral Argument: Life Tech (export of components) set for December 6, 2016.

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Citing to Supreme Court’s Eligibility Cases

The chart below shows Shepard’s citation results for recent Supreme Court eligibility cases.  I chart the number of federal court decisions citing to each of these seven major Supreme Court decisions.  2016 numbers do not include November-December 2016.

Citing101DecisionChart

* I apologize that the chart won’t be easy to read for those who are colorblind. Truthfully, it is hard for anyone to tease out information regarding any particular decision.

Supreme Court Update: Extending the ITC’s Reach Beyond US Borders

by Dennis Crouch

Constitutional Challenge to Inter Partes Review: Although the Constitutional issues in Cooper v. Lee and MCM v. HP were law-professor-interesting, they were not substantial enough for certiorari.  The Supreme Court has now denied the Cooper and MCM petitions — leaving the IPR regime unchanged.  Although Cooper v. Square is still pending, its chances are slight. The Supreme Court has also denied certiorari in Encyclopaedia Britannica (malpractice), Gnosis (appellate review), and GeoTag (case-or-controversy).

A new 101 Challenge: In its first conference of the term, the Supreme Court denied all of the pending petitions regarding patent eligibility.  However, Trading Technologies has filed a new petition asking whether a new card game is categorically unpatentable so long as it uses a standard deck (rather than a novel deck) of cards.  My post on the case asks: Does the Patent Statute Cabin-in the Abstract Idea Exception?  That question references Section 100 of the Patent Act that expressly allows for the patenting of new use of a known manufacture.

Extra Territoriality of Trade Secrecy Law: On the trade secrecy front, Sino Legend has petitioned to review the Federal Circuit’s affirmance of the International Trade Commision’s ban on Legend’s importation of rubber resins used for tire production. The underlying bad-act was a trade secret misappropriation that occurred in China and the question on appeal asks: Whether Section 337(a)(1)(A) permits the ITC to adjudicate claims regarding trade secret misappropriation alleged to have occurred outside the United States.  A Chinese court looked at the same case and found no misappropriation.

Design Patent Damages: Oral arguments were held earlier this week in Samsung v. Apple. During the arguments, all parties agreed that (1) the statute does not allow for apportionment of damages but rather requires profit disgorgement; (2) the article-of-manufacture from which profits can be calculated may be a component of the product sold to consumers; and (3) the determination of what counts as the article-of-manufacture is a question of fact to be determined by the jury.   The only dispute then was on the factors that a jury should be considered and when the “inside gears” of a product should ever be included in the calculation.

Upcoming Supreme Court Oral Argument: SCA Hygiene (laches) on November 1; Star Athletica (copyright of cheerleader outfit) on October 31.

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