EDITORIAL NOTE: What follows is the Summary of the Argument from the AIPLA amicus briefin Limelight Networks, Inc. v. Akamai Technologies, Inc. The brief is filed by Wayne P. Sobon, who is the current President of the AIPLA, with Jeffrey I.D. Lewis listed as Counsel of Record. Lewis is himself a former AIPLA President. Also on the brief with Lewis is Scott B. Howard.
The cornerstone of Petitioner’s argument is that it follows from the language and simple structure of Sections 271(a) and 271(b) of Title 35 “that § 271(b) proscribes conduct that induces actionable direct infringement of a patent as described in § 271(a).” Pet. Br. at 1 (emphasis added). In doing so, Petitioner focuses on the elements of a claim for induced infringement under 35 U.S.C. § 271(b), but hides the true issues of this case – what is the meaning of “infringement” and is there patent liability when someone causes all of the steps of a method patent to be performed but no single entity performs all of the steps of the method claim by him or herself?
Recent Federal Circuit law has, without any statutory basis, limited infringement under Section 271(a) to the actions of a single entity, and some amici have even mistakenly characterized the single entity rule as settled law, e.g., Brief of Amici Curiae Cargill, Inc. et al. at 4 (but it is not, as shown below and in district court cases in the accompanying footnote  ). It is that erroneous limitation that leads to confusion over whether or not direct infringement is necessary for a finding of indirect, induced infringement.
The oral argument schedule for the Supreme Court over the next few months is heavy on intellectual property cases.
The Court will hear oral argument as follows: on February 26, in two cases on granting (Octane Fitness) and reviewing (Highmark) attorneys’ fee awards; on March 31, in a case (Alice Corp.) on patent eligibility of system and computer-implemented method claims; on April 21, in a case (POM Wonderful) on claims under Section 43 of the Lanham Act challenging labels regulated by the Food and Drug Administration; on April 22, in a case (Aereo) on whether a provider of broadcast television programming over the Internet violates a copyright owner’s public performance right; on April 28, in a case (Nautilus) on the proper standard for finding indefiniteness invalidity for patents; and on April 30, in a case (Limelight) on joint liability for method claim infringement where all of the claimed steps are performed but not by a single entity.
What follows is a portion of the written statement of Q. Todd Dickinson, Executive Director of the American Intellectual Property Law Association, republished here with permission. Mr. Dickinson testified today at the Senate Judiciary Committee hearing on “Protecting Small Businesses and Promoting Innovation by Limiting Patent Troll Abuse.” To read Mr. Dickinson’s full prepared statement please see Testimony of Q. Todd Dickinson.
Q. Todd Dickinson, Executive Director of the American Intellectual Property Law Association.
A recurring theme that can be traced through the patent reforms of the AIA to the current debate over patent litigation abuse is the issue of patent quality. A key component of the reported abuses is the assertion of allegedly invalid or overbroad patents, the very abuse for which AIA post-grant procedures were created, in order to improve patent quality. These matters of patent quality are being addressed by the changes made to the law by the Judiciary and by Congress in the AIA, which are only now beginning to be felt.4 It may well be premature to conclude that they are not doing the job.
Take one major example, as a former Director of the USPTO in particular, I would support, as former Director Kappos did, giving the post-grant processes in the USPTO a chance to work.
They have only been in place for less than two years, and in the case of PGR, less than one.5 Early data suggests that they are performing in many ways as Congress intended, at least at the macro level, to provide an efficient, less expensive means to address potentially low quality patents. We believe that the prudent course is to give these reforms the chance to demonstrate their efficacy to deal with the concerns for which they were created before we consider making significant additional changes which may have their own unintended consequences. In support of this proposition to wait and see how they are working, we would simply point out that the AIA itself requires that USPTO study the reforms implemented by the AIA and report back to Congress by September 16, 2015. Those reports would serve as an important and more empirically-driven body of data which would allow for greater clarity and direction in making any necessary changes.
The Supreme Court on November 5, 2013, heard oral argument on whether the burden of proof in an action for a declaratory judgment of non-infringement falls on the plaintiff licensee or on the defendant patentee. Medtronic Inc. v. Boston Scientific Corp., U.S., No. 12-1128, oral argument 11/5/2013.
The debate centered around whether a patentee/defendant sued for a declaratory judgment of non-infringement is required to prove a case of infringement that was neither alleged nor arguably possible where the DJ plaintiff is a licensee. The Petitioner argued that the burden that would be on the patentee as infringement plaintiff does not change when it is a DJ defendant. The Respondent argued that, because the patentee cannot assert an infringement counterclaim against its licensee in good standing, the normal default rule places the burden on the party that initiates the action.
Patent law places the burden of proving infringement on the patentee, and the procedural device provided by the Declaratory Judgment Act does not shift that burden, according to Seth Waxman of WilmerHale, arguing for Petitioner Medtronic. The Federal Circuit erred in changing the rule where the DJ plaintiff is a licensee.
The en banc Federal Circuit on September 13, 2013, heard oral argument on whether to overrule its en banc decision in Cybor Corp. v. FAS Technologies, Inc., 138 F.3d 1448 (Fed. Cir. 1998), and hold that claim construction can involve issues of fact reviewable for clear error, and that it is not entirely an issue of law subject only to de novo review. Lighting Ballast Control LLC v. Universal Lighting Technologies, Inc., Fed. Cir., No. 2012-1014, 3/15/2013.
Lighting Ballast Control LLC (LBC) owns a patent (5,436,529) on control and protection circuits for electronic lighting ballasts commonly used in fluorescent lighting. The patent includes the term “voltage source means” in the following context: “voltage source means providing a constant or variable magnitude DC voltage between the DC input terminals.” LBC sued Universal Lighting Technologies, Inc. (ULT).
District Court Decision
On appeal is the district court decision that a person of ordinary skill in the art would understand the claim term “voltage source means” to correspond to a rectifier or other voltage supply device. It thus rejected ULT’s argument that the term invokes Section 112 ¶6 and that the claim is invalid for indefiniteness for lack of specific structure in the specification. A Federal Circuit panel reversed in a nonprecedential decision, concluding from a de novo review that “voltage source means” does invoke Section 112 ¶6 and that the claim is invalid for indefiniteness. That panel decision was vacated when the appellate court decided to consider the claim construction issue en banc.
EDITOR’S NOTE: This year I will be speaking at the AIPLA meeting on The AIA: Traps for the Unwary. I will publish my paper here on IPWatchdog.com in segments over the next week. We also have on tap a wide ranging discussion with AIPLA Executive Director Todd Dickinson, and a few other AIPLA-centric pieces are in progress. Ultimately our AIPLA coverage will culminate, as usual, with full coverage of the AIPLA annual meeting, which takes place at the Marriott Wardman Park Hotel from October 24-26, 2013.CLICK HERE to register for the AIPLA annual meeting.
The America Invents Act (AIA),  signed by President Barack Obama on September 16, 2011,  ushered in many significant changes to U.S. patent law. The USPTO summarizes the changes that went into effect on March 16, 2013 as follows:
(1) Convert the U.S. patent system from a ‘‘first to invent’’ system to a ‘‘first inventor to file’’ system; (2) treat U.S. patents and U.S. patent application publications as prior art as of their earliest effective filing date, regardless of whether the earliest effective filing date is based upon an application filed in the United States or in another country; (3) eliminate the requirement that a prior public use or sale be ‘‘in this country’’ to be a prior art activity; and (4) treat commonly owned or joint research agreement patents and patent application publications as being by the same inventive entity for purposes of 35 U.S.C. 102, as well as 35 U.S.C. 103. These changes in section 3 of the AIA are effective on March 16, 2013, but apply only to certain applications filed on or after March 16, 2013. 
Honestly, it is impossible to in any single article or series of articles describe the magnitude of the changes ushered in by first to file. This is because Congress has fundamentally altered the definition of what is considered prior art. An applicant is still entitled to a patent unless there is prior art that renders the claimed invention unpatentable because it is not new or because it is obvious. But what references and information can be considered prior art? That is where things have fundamentally changed.
The Supreme Court on June 24, 2013, called for the views of the Solicitor General on petitions to review the Federal Circuit’s en banc decision on joint infringement of process patents. That decision held that induced infringement of a process patent claim may be found even though no single entity performed all of the claimed steps as long as claim steps are performed collectively by multiple parties. In Akamai Technologies, Inc v. Limelight Networks, Inc., U.S., No. 12-960, 6/11/2013, the question presented is:
Whether a party may be liable for infringement under either 35 U.S.C. §271(a) or §271(b) where two or more entities join together to perform all of the steps of a process claim?
In Limelight Networks, Inc., v. Akamai Technologies, Inc., U.S., No. 12-786, 6/11/2013, the question presented is:
Whether the Federal Circuit erred in holding that a defendant may be held liable for inducing patent infringement under 35 U.S.C. § 271(b) even though no one has committed direct infringement under §271(a).
The Supreme Court on May 20, 2013, agreed to review a Federal Circuit decision that a patent licensee bears the burden of proof in its action for a declaratory judgment of noninfringement where the license remains in effect to preclude the defendant patentee’s infringement counterclaim. Medtronic Inc. v. Boston Scientific Corp., U.S., No. 12-1128, 5/20/2013.
The question presented in the petition for certiorari is as follows:
In Medlmmune, Inc. v. Genentech, Inc., 549 U.S. 118, 137 (2007), this Court ruled that a patent licensee that believes that its products do not infringe the patent and accordingly are not subject to royalty payments is “not required … to break or terminate its … license agreement before seeking a declaratory judgment in federal court that the underlying patent is … not infringed.”
The question presented is whether, in such a declaratory judgment action brought by a licensee under MedImmune, the licensee has the burden to prove that its products do not infringe the patent, or whether (as is the case in all other patent litigation, including other declaratory judgment actions), the patentee must prove infringement.
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