This year as we wind down and look back we not only need to look back at the previous year, but the first decade of the new century and new millennium will be ending. So at this reflective time of year it seems appropriate to take a look back at the biggest patent related news stories of the decade. As with any Top 10 list, or any ranking, there will undoubtedly be disagreements, arguments and some things that people believe should have been on the list. What follows is Part 1 of my personal Top 10 patent news related stories for the decade. Once I get all 10 out, by later in the week, I will provide a survey that allows you to rank them, and I hope you will. We can then take a look back at my Top 10 vs. the Top 10 of IPWatchdog.com readers next year. Please also feel free (and I am sure you will) to point out things that I missed or clearly got wrong, at least in your opinion.
Without further ado, in descending order, here is Part 1 of my Top 10 Patent Related Stories of the Decade:
10. The Doctrine of Equivalents – Festo and Honeywell
Clearly the doctrine of equivalents is much ado about nothing, thanks in no small part to the work of the United States Court of Appeals for the Federal Circuit and the United States Supreme Court. While Festo v. Shoketsu Kinzoku Kogyo Kabushiki came to a head early in the decade (May 2002) it continued to linger throughout the decade and consume far more time and energy than it deserved. Recall that the Federal Circuit had ruled that any amendment precluded making a claim of infringement under the doctrine of equivalents, which went completely against Supreme Court precedent. The Supreme Court took the Festo case and embarked on a decade of reversing the Federal Circuit. In this situation what the Supreme Court came out with was even worse, and terribly intellectually dishonest.
The Supreme Court explained: “There is no reason why a narrowing amendment should be deemed to relinquish equivalents unforeseeable at the time of the amendment and beyond a fair interpretation of what was surrendered.” And that when an equivalent was unforeseeable “the patentee can overcome the presumption that prosecution history estoppel bars a finding of equivalence.” Thus, in order to be entitled to make a claim under the doctrine of equivalents you must demonstrate you were not in possession of the invention at the time of filing, thereby creating a Written Description problem. Brilliant!
On June 2, 2004, apparently unknown to the Supreme Court (because they refused cert.), the Federal Circuit killed the doctrine of equivalents in Honeywell International Inc. v. Sundstrand Corp., where the Federal Circuit ruled that dependent claims rewritten into independent form during prosecution lost the doctrine of equivalents even if claim scope never changed. Judge Newman in dissent explained “this new rule will simply drive patent applicants away from dependent claims and away from the accepted protocol of presenting successively narrowed dependent claims for examination. This new rule will simply raise the cost and increase the difficulty of patent examination.” She turned out to be correct, as some large firms with big tech clients started filing patent applications with thousands of claims in order to guarantee many would issue without ever having been amended at all!
9. Brobeck; Pennie & Edmonds; Morgan & Finnegan No More
Perhaps no news story shook the patent bar quite the same way as did the demise of Brobeck, Phleger & Harrison and Pennie & Edmonds, both of which occurred in 2003. Morgan & Finnegan also dissolved and then filed for bankruptcy earlier this year, and other high profile fimrs such as Lyon & Lyon and Fish & Neave met their demise, but none more spectacularly than the three mentioned at #9.
Brobeck was began in 1926 with three lawyers and went on to become one of the most powerful names in the patent space, representing a whose who of clients in San Francisco, California. At some point in time during the 1990s, as the technology sector was growing at an enormous rate, Brobeck decided to start accepting equity in emerging start-up tech companies in lieu of traditional pay-as-you-go compensation for lawyers. This lead to a rapidly expanding base of clients, the hiring or more and more attorneys and partner’s per year compensation that rose to more than $1 million on average. Times were good, at least right up until they were not good. As the Internet/tech bubble burst, so did the firm. The practice of taking equity in companies that crashed in value practically overnight proved more than the venerable firm could withstand.
Pennie & Edmonds was a New York City based firm that focused on all aspects of intellectual property. The firm started in 1883 and had a run of 120 years, being dissolved on December 31, 2003. The popular belief on the demise of the firm suggests that at this time general practice firms were starting to gain on boutiques, causing problems for Pennie & Edmonds. Additionally, the loss of Jonathan A. Marshall, a rainmaking litigator with high profile clients such as Hewlett-Packard, certainly did not help. But perhaps the straw the broke the camel’s back was the U.S. District Court for the Western District of New York ruling that the University of Rochester patent relating to Cox II Inhibitors was invalid in March 2003. Pennie & Edmonds already had ethical problems associated with not telling existing clients who would be targets of the patent that they were representing the University of Rochester, and when the patent estimated to bring in $4 to $5 billion to the University in royalties was lost the writing was no doubt on the wall.
Morgan & Finnegan started in 1893, and was one of the nation’s oldest and most respected intellectual property law firms. Thanks to numerous partners leaving and little fresh talent coming in, Morgan & Finnegan dissolved in February and filed for bankruptcy protection just 6 days after being placed into receivership in response to a lawsuit by lender JPMorgan Chase. The boutique firm listed $6.37 million in assets and $10 million in liabilities in its bankruptcy filing.
8. Patent Reform That Never Happened
On again, off again, patent reform has dominated policy discussions and lobbying efforts for the second half of the decade now about to end. While frequent readers of IPWatchdog.com may have difficulty believing this, I never used to follow patent legislation unless and until it was enacted because so often nothing was ever accomplished. Then several years ago I heard from several trusted sources that it was a done deal, it was going to happen and nothing could stop it. Famous last words! In all truth, I cannot blame those sources because over and over again patent reform legislation has been a done deal only to lose all momentum at the last minute. So we will close 2009 and the decade without anything to show for it.
On some level the lack of patent reform has been enormously positive. At least Congress has not done any more harm with a topic that the vast majority of them seem to know little or nothing about. If Senator Kyl, Senator Hatch and Congressman Issa could fashion reform I would be all for it, but there are 532 other Members of Congress that I worry about to one degree or another. The Federal Circuit has taken care of some of the issues, particularly venue in the Eastern District of Texas in the TS Tech case. The sad thing about patent reform is that even if it had happened it still wouldn’t have done much good because the larger issues of obviousness and inequitable conduct were not going to be fixed. Maybe 2010 will be a different year, but I am not holding my breathe. Of course, like any train wreck it is hard not to watch and be amused by talk of imminent patent reform. I guess I just don’t understand what the word “imminent” means.
7. The Rise of Patent Blogs
No doubt some will think this is self serving, but that is not true. If you are reading this article I don’t need to convince you that IPWatchdog.com is worth reading, or that patent blogs in general are worth reading. At the beginning of the decade I was doing a weekly newsletter that reviewed every intellectual property case with a decision or opinion in the Federal Court system. With the rise of widespread and cost effective (or even free) content management systems many who were doing various newsletters and working with static websites transitioned into blogging. Truth be told, I don’t like the term “blogging” with respect to what I do, and I don’t really think it applies to most of the best patent blogs out there today. We write op-ed type pieces, informational articles and what we do collectively is much more like an online magazine than it is a blog, which frequently seems to be mostly random and brief thoughts.
There are a lot of great patent blogs out there. Recently larger firms are getting into patent blogging, which will no doubt keep all of us on our toes and continue to lift the quality through what is no doubt a competition, albeit hopefully a friendly competition.
The net result is high quality information and analysis that is easily findable and accessible. Blogs in our space are picked up in Google News and in Google, Yahoo and Bing search engines. Now if the popular press can raise its analysis and reporting the role of blogs and blogging will only have continued impact on shaping debate and influencing decision makers and the public.
6. Obama Names Patent Attorney PTO Director
It is impossible for readers of IPWatchdog.com not to know my own particular political persuasion. I did not vote for President Obama, but I try and keep my analysis real. While I don’t agree with much of what is happening in Washington, DC, the area I know best is one that has dramatically improved since President Obama became our 44th President. After a disastrous period during the second Bush Administration, the United States Patent Office seems to be once again open for business and operating as a Patent Granting Authority! While things started to change upon the resignation of former PTO Director Jon Dudas, there was only so much that could be accomplished by the dedicated career employees and officials at the USPTO prior to a new Director coming to power.
Simply stated, David Kappos is the right man for the job and he is making great progress. I cannot say that I have disagreed with anything he has done so far, and it is clear that he understands the patent process and what ails the patent system. He has surrounded himself with high caliber people who are well respected and dedicated. Some of these people are Sharon Barner, Bob Stoll, Peggy Focarino and Rob Clarke. I have great hopes for 2010 and beyond, and having a patent attorney run the Patent Office will make all the difference.
Thank you President Obama for listening to the patent bar and giving us a Director with a plan and someone who knows what he is doing!
NOTE: Article updated 12/21/09 at 4:52pm ET to add Morgan & Finnegan to #9.