The original January 2013 opinion was authored by Judge Neman with Judges Prost and Reyna in agreement. In that opinion the Court identified claim 34 as representative of the “shopping cart” claims, and held claim 34 invalid on the ground of obviousness. The parties stated, on petition for rehearing, that the Federal Circuit ruling should have been for claim 35, which would conform to the judgment entered on the jury verdict. Ultimately, the rehearing was not successful and claim 35, like claim 34, was ruled invalid because it was obvious. See Soverain Software LLC v. Newegg, Inc. (Fed. Cir., September 4, 2013).
The Newegg brief in opposition to Soverain’s Petition for Certiorari was due on November 18, 2o13, but Newegg’s attorney requested an extension until Thursday, December 12, 2013, so we await the filing of Newegg’s opposition brief. I have been told that Soverain plans to file a reply to whatever Newegg files, so it will be some time before we know whether the Supreme Court will take this important case.
The Pioneering Technology
Before diving into why this case matters and everyone should pay close attention, allow me to point out that the technology involved in this case is THE original shopping cart technology. In fact, the ’314 patent matured from a patent application that was filed on October 24, 1994. Despite what you may have heard, this is not an example of a bad patent, nor is it something that wasn’t new or was legitimately obvious at the time it was invented, which would have been some meaningful time before October 24, 1994. This is an example of a pioneering invention that came about at the dawn of Internet as we know it today. The fact that it is ancient in Internet terms does not mean that the claims are bad, it merely means that the innovation embodied in the patent is fundamentally important. Indeed, the Soverain’s enterprise software product has been in use for nearly 18 years, and has been used by over 1,000 customers in over 25 countries, including companies such as Time-Warner, AT&T, Sony, Disney, BusinessWeek and Reuters.
Dean Kamen accepts the Inventor of the Year Award.
Last night at the National Portrait Gallery, which is the modern day site of the Old Patent Office Building, the IPO Educational Foundation awarded Dean Kamen the 40th National Inventor of the Year Award, and recognized Doug Henderson with the 6th Distinguished IP Professional Award. Also honored were the teenagers who won the 3rd IP Video Contest in three separate age categories.
The evening started off earlier than typical, with the presentation of the Inventor of the Year Award taking place prior to the dinner because Teresa Heinz Kerry, a long time friend of Dean Kamen, was in attendance to present Kamen with the award. Secretary of State John Kerry was expected, but could not attend. In attendance, however, was Senator Kelly Ayotte (R-NH), who is the Junior Senator from Kamen’s home State of New Hampshire.
Before proceeding, it is worth noting that Senator Ayotte said all the right things about the importance patents play for innovation and pledged to thoughtfully consider patent reform now pending before Congress. Ayotte went so far as to say that she specifically wants to hear from all the stakeholders, including the innovators who were in attendance, before the Senate would take any action on patent reform that was passed by the House last week. Unfortunately, by the time Senator Ayotte was giving these remarks it had already been announced that Senator Patrick Leahy (D-VT) has scheduled a hearing in the Senate Judiciary Committee on the Senate companion legislation for Tuesday, December 17, 2013, which suggests that the legislation will be fast-tracked in the Senate without much serious discussion, at least unless someone like Senator Ayotte stands up and uses her considerable powers to halt the legislation unless and until there really is meaningful consideration of the ramifications of the bill if enacted.
WASHINGTON — U.S. Secretary of Commerce Penny Pritzker today announced the appointment of Michelle K. Lee as the next Deputy Under Secretary of Commerce for Intellectual Property and Deputy Director of the U.S. Patent and Trademark Office (USPTO). Lee currently serves as the Director of the USPTO’s Silicon Valley satellite office and will begin her new role at USPTO headquarters in Alexandria, VA, on January 13, 2014.
While Director of the USPTO’s Silicon Valley satellite office, Lee has served as the agency’s primary liaison with the innovation community in the Silicon Valley and West Coast, leading the establishment of a temporary office in Menlo Park and working creatively with California’s Congressional, state, and local leadership to successfully secure a permanent office location in San Jose. In that role, she has also been actively engaged in education and outreach initiatives, empowering the USPTO to more effectively develop programs, policies, and procedures to meet the needs of the West Coast innovation community. Beyond the Silicon Valley office, Lee has also played a broader role in helping shape key policy matters impacting the nation’s intellectual property (IP) system, focusing closely on efforts to continually strengthen patent quality, as well as curbing abusive patent litigation. Prior to becoming Director of the Silicon Valley USPTO, Lee served two terms on the USPTO’s Patent Public Advisory Committee, whose members are appointed by the U.S. Commerce Secretary and serve to advise the USPTO on its policies, goals, performance, budget and user fees.
If you’ve decided that a PGC is right for you, there are a few other related strategic considerations that you may want to evaluate before proceeding: preliminary response, joinder, stay, and amendment.
You may want to consider keeping your cards in your pocket by not filing a preliminary response. If you file a preliminary response, it may provide the petitioner a road map to cure their deficiencies via a second petition or reveal the defects of your position to them. So if the petition is sloppy in some respects it may be in your best interests to not file. On the other hand, not filing a preliminary response may work against you. For every petition the PTAB goes through the preliminary claim construction based upon the evidence given. So if you put in your preliminary response, that will give the APJs additional information to consider when doing claim construction. “I might [initially] be guided by the petitioner’s insights if there’s no patent owner response. If you don’t file a response some times you read between the lines, and assume petitioner[‘s argument] is better,” says Judge Michael P. Tierney, Lead Administrative Patent Judge of the PTAB at the PTO. Then again, APJs thoroughness will likely and generally trump any bias. Just to give you perspective on what other people are doing, eighty-one percent filed a preliminary response with IPR and CBM in 2013, and as of November 21st of this year 77 percent filed a preliminary response, according to a recent AIA Progress Statistics report.
What is lacking from the debate over “patent trolls” is the “other side” of the story. In other words- who is benefiting from large multinational high tech companies being forced to deal with claims of infringement against them?
The major beneficiaries are not the patent trolls- but the thousands of single patent owners and small high tech start ups who for the first time ever-are able to monetize the enormous investments in time, money and ingenuity that they have made in their inventions.
The fact is- today, small patent owner and small tech start ups have real options to liquidate their intellectual property assets that they didn’t have before Intellectual Ventures and Acacia Research Group entered the market in the mid-2000s. If patent trolls sue big companies- then the owners of these patents were able to liquidate their investments. When the multinationals have to worry about these entities suing them it is good for the owners of the patents.
Patent trolls are not bad for them. That’s for sure.
About a year after the introduction of the post grant challenge (PGC) options, you probably have some idea about PGCs and how to deal with the unique rules of this forum. (If you need a refresher on that, read here.) What a lot of us are left wondering is how exactly to decide whether to use one of these options. I’ll elaborate on one approach that may provide some guidance: 1) Weigh the pros and cons; 2) Think about the timing of filing; and 3) Evaluate the nature of your argument.
Assuming there’s enough at stake for your client to go this route, you’ll first want to weigh the pros and cons of filing a petition.
Advantages of PGCs
“From an in-house perspective there’s no question that the various new post grant challenge options under the America invents Act are really a major shift in strategy; it’s a major step in the right direction,” says Samir Pandya, Senior IP Counsel of the Global Litigation Group at SAP, at the 2013 AIPLA Annual meeting.
A goal of nearly every defendant is to lower the total cost of resolution of any legal issue. As counsel for the defendant, you have to weigh the settlement and licensing costs of a patent dispute against the total defense cost and how long it takes to resolve the dispute with certainty. Today, CBM, IPR, and PGR are the lowest possible cost options.
On Thursday, December 5, 2013, the United States House of Representatives passed the Innovation Act by a vote of 325-91.
Surprisingly, the Innovation Act (HR 3309) had only been introduced on October 23, 2013, and was marked-up on November 20, 2013. So what was the rush? This break-neck pace, which took place in a Congress that has been noted for its extraordinary inaction, is curious to say the least. Indeed, one Member of Congress went much further than raising a curious eyebrow. “This schedule suggests the fix was in,” said Congressman Dana Rohrabacher (R-CA) on December 3, 2013, “The clear message to little inventors: give thanks for your intellectual property rights, because you may not have them by this time next year.”
There is no doubt that Congressman Rohrabacher is correct, even if his criticism seems at first glance to be a bit over the top. There can be no serious disagreement over the undeniable truth that over the last 7 or 8 years there has been a steady erosion of patent rights both in the Courts and thanks to laws passed by Congress. There can also be little serious disagreement that the speedy process afforded the Innovation Act prevented those who favor strong patent rights from mounting a credible opposition to the bill. Unfortunately, the forces that seek to weaken patent rights are well funded and fight the battle each and every day. Even before the America Invents Act (AIA) was passed in 2011 there were efforts underway to plant the seeds of what will be the next “industry ask” of Congress, which is stripping the ITC of its patent jurisdiction or at the least preventing the ITC from issuing exclusion orders. See Follow the Moneyand Weakening the ITC Will Harm the US Economyand Are Some Patent Holders More Equal Than Others?
The Truth is that while innovators spend their time inventing and doing business, not focusing on what has been taken for granted in the United States since the days of Thomas Edison, which is a strong patent system. Indeed, in this round of patent reform Universities, small businesses, technology based start-ups and independent inventors were given no meaningful opportunity to express their views. At the one hearing on the bill David Kappos, former Director of the USPTO and now a partner at Cravath, Swaine & Moore, cautioned Congress about going to fast and pointed out that no independent inventors were even invited to testify. But there is no rest for those who seek patent reforms that make patents less valuable, they are hard at work on whatever the current attempt is to chip away at patent rights, but also working to lay the foundation for further erosion of patent rights.
Typically blog roll links are not helpful to a website's rank. To give some additional "link love" to those we think you might be interested in reading we have moved our blog roll and links to a dedicated page. Go to IPWatchdog Blog Roll & Links.