A patent practitioner prosecuting an application would not normally worry about an issued patent having a much later filing date. The CAFC’s Hubbell decision shows, however, that such a patent can create a problem under the doctrine of obviousness-type double patenting, that prevents the earlier-filed application from issuing.
Hubbell is an inventor of U.S. Application 10/650,509. Hubbell appeals from the decision of the Board of Patent Appeals and Interferences affirming the Examiner’s final rejection of his claims for obviousness-type double patenting over U.S. Patent No. 7,601,685, which also names Hubbell as an inventor. The ‘509 application was filed on August 27, 2003, but claims benefit of a provisional application filed in 1997 when Hubbell was a professor at CalTech. Thus, the ‘509 application is assigned to CalTech.
Hubbell left CalTech and joined the faculty at Eidgenossische Technische Hochschule Zurich (“ETHZ”) in 1998. The application which issued as the ‘685 patent was filed on December 17, 2002 and is jointly assigned to ETHZ and Universitat Zurich. It is undisputed that the ‘509 application and the ‘605 patent do not have identical inventive entities, nor do they have common assignees. It is also undisputed that the ‘685 patent is not available as prior art under 35 USC §§ 102 or 103. The Patent Office concluded that the ‘685 patent claims “are a species of the instantly claimed invention and thus anticipate the claimed invention,” in making its obviousness-type double patenting rejection.
The term “privateering” is a new one for some, but by the end of 2013, everyone will talking about it. It’s the transfer of patent rights, including the right to sue for infringement, from a large company with a strong research and development capability to a patent holding company.
There is a tremendous amount of unrealized (“un-monetized”) value in the patent portfolios of many large companies. Yet, for one reason or another, such companies have chosen over the years not enforce their patents in court or through a licensing campaign. In recent times, however, a few of these companies have, one-by-one, started to transfer their patent rights to patent holding companies that are quite willing to enforce those patents. What does the large company receive in return for its patents?
Do patent applicants appealing a rejection of their claims from the Patent Trial and Appeals Board have a chance of success at the Court of Appeals for the Federal Circuit? What about patentees appealing to the CAFC from rejections in reexamination proceedings? The candid answer is not much of a chance. Of course, every case is different and needs to be considered on its own merits. Yet, the standards for review of Board decisions, followed by the CAFC, significantly favor affirmance of those decisions.
What about a rejection by the Board that the claims in an application or patent are anticipated by a prior art reference? The CAFC reviews an anticipation rejection as a “finding of fact” under the “substantial evidence” standard. In re Gleave, 560 F.3d 1331, 1334-35 (Fed. Cir. 2009). A finding of fact is “supported by substantial evidence [and therefore affirmed] if a reasonable mind might accept the evidence to support the finding.” Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938). For a reversal, it is not enough that the CAFC simply disagrees with the Board – the CAFC must find that no reasonable person would have rejected the claims.
Something a bit out of the ordinary occurred earlier this month in the ITC investigation Certain Devices for Mobile Data Communication, 337-TA-809. There, Unwired Planet had accused Apple and Research-In-Motion of infringing four patents related to data transmission with cellular phones. A trial before the ITC’s Administrative Law Judge Gildea was scheduled to begin October 15, but shortly before that date, Unwired withdrew its Complaint and filed a motion with the Judge Gildea to terminate the investigation. Unwired’s problem was that the Judge had previously construed the asserted claims to require that the mobile devices do not contain “a computer module,” thereby precluding a finding of infringement by the accused devices that do contain module computers. Unwired, however, has not entirely given up on its infringement allegations against Apple and RIM – rather, Unwired continues to pursue those claims in a parallel infringement action in Delaware.
Unwired’s withdrawal of its Complaint raises several interesting questions. First, could Unwired have continued its ITC case?
Press releases are a common feature of patent disputes, particularly patent disputes involving reexamination proceedings at the Patent Office. An accused infringer announces that its reexamination request has been granted, that the patent claims have been rejected, or that a rejection has been affirmed by the PTO Board. Or patent owner announces that its claims have survived reexamination. Often the author of the press release tells its story in “a favorable light.” Almost always, a party’s goal in issuing a release is to convince the public that it will ultimately prevail.
But can a press release, by itself, expose its author to potential civil liability? Yes it can. A story of such potential liability is now playing out in Taser International v. Stinger, (Case No. 2:09-cv-289 (D. Nev.)). Taser, the developer of the TASER weapon for use by law enforcement, originally sued Stinger Systems for selling devices that infringed a number of Taser patents. The infringement action lasted three years and ended with a judgment that Stinger infringed one of the patents and an injunction prohibiting future infringement of that patent.
The CAFC’s split panel decision this past week – In re Construction Equipment Company – extends the PTO’s authority to reexamine a patent even where its validity has already been adjudicated and confirmed by the courts. Yet the CAFC once again fails to explain how a PTO reexamination finding that a patent is invalid effects an earlier judicial determination that the same patent is valid and infringed.
In re Swanson
The authority of the PTO to reexamine a patent that has previously been found to be valid by the courts was established by the CAFC’s 2008 decision, In re Swanson. There, the patent owner sued for infringement. A jury found that the patent was not infringed, but additionally found that the patent was not invalid over the so-called Duetsch reference. The trial judge denied the various post-trial motions, confirming the jury’s verdict. And the CAFC affirmed the trial judge’s judgment regarding validity, explicitly finding that “Deutsch” did not anticipate the patent claims.
Companies accused of patent infringement are increasingly looking at patent reexamination at the Patent Office as an attractive avenue for challenging the patent’s validity. Reexamination offers a number of well-known advantages as a forum for such validity challenges over District Court, among them the absence of a presumption of validity and a lower burden of proof. Less well-known, however, is the potential for reexamination to eliminate an accused infringer’s liability for past damages – even if the PTO confirms the validity of a patent in reexamination, the accused infringer might be entitled to “intervening rights,” effectively eliminating past damages, if the patent owner amends its claims to distinguish its invention over the prior art. Even when the patent owner succeeds in the reexamination, if it also amends its claims, it can lose its right to collect damages for infringement occurring prior to the end of the reexamination.
This possibility of “intervening rights” received a big boost last week with the CAFC’s decision in Marine Polymer Techs. v. HemCon, finding that such rights may be created even without an amendment of the claims if the patent owner presents arguments in reexamination that “effectively amend” the claims.
Paul Allen’s road to monetize his huge patent portfolio took an abrupt detour when Judge Marsha Peckham of the Western District of Washington stayed Allen’s eleven infringement cases, pending completion of reexamination proceedings for the patents-in-suit.
Allen, a co-founder or Microsoft, established Interval Research Corporation and then set about acquiring an enormous number of patents, assigning them to Interval Research. For years, his patents sat quietly as idle assets. The subject of constant speculation in the high-tech community, Allen’s patents remained untested. But on August 27, 2010, Allen, through corporate subsidiary Interval Licensing, sued a who’s-who of computer and Internet companies in the District Court in Seattle, notably AOL, Apple, eBay, Facebook, Google, Netflix, Office Depot, OfficeMax, Staples, Yahoo!, and YouTube. Apart from a minor hic-up in December, when Judge Peckham ordered Interval Licensing to state the basis for its infringement allegations with greater specificity, see Complaint Dismissed, the case proceeded smoothly.
The main front of the on-going war between Microsoft and i4i regarding the latter’s U.S. Patent No. 5,787,449 is certainly the Supreme Court. There, Microsoft has asked the Court to reverse a $290 million verdict against it for infringement of the ‘449 patent, arguing that the burden on an accused infringer of proving that a patent is invalid over the prior art should be “preponderance of the evidence” rather than the traditional standard applied by the trial court of “clear and convincing” evidence, at least where the reference asserted was not before the examiner in the original patent prosecution. The Court’s grant of certiorari in this case has understandably generated enormous concern in the patent community, fearful of the potential for undermining the strength of hundreds of thousands of commercially significant patents.
At the same time that Microsoft pursued its appeal of the verdict for i4i, both at the Supreme Court and earlier at the Court of Appeals for the Federal Circuit, Microsoft requested that the Patent Office undertake a new reexamination of the ‘449 patent on the basis of previously considered prior art, but art presented “in a new light” according to Microsoft. This request was dismissed by commentators as a side-show, a mere attempt to support its argument before the Supreme Court, or even a “Hail Mary” (actually, I said that). Indeed, that estimation seemed to be correct when the patent examiner refused to grant Microsoft’s request to grant reexamination – a sharp rejection in view of the very high percentage of reexamination requests that are granted.
On Thursday the PTO Board of Appeals affirmed (here, here) the reexamination examiner’s findings that two patents – U.S. Patent Nos. 7,314,328 and 7,325,994 – are valid over certain prior art. The ‘328 and ‘994 patents are owned by Mack-Ray and claim nozzle structures for “a spreader apparatus,” e.g., a squeeze bottle for holding jelly and spreading it on bread. Mack-Ray sued Smucker (the jelly company) for infringing the two patents, and both companies subsequently requested the present reexaminations. What will interest reexamination practitioners, however, is the extreme reluctance of the Board to consider issues not strictly within the PTO’s reexamination jurisdiction.