Posts in IPWatchdog Articles

Cobra Products filed a lawsuit for patent infringement. G.T. Water then filed for a re-examination of my patent at the U.S. Patent and Trademark Office to invalidate my patent claims. My licensing agreement with Cobra and BrassCraft was to share equally in the cost of defending my patent. However, Cobra Products elected not to help me in the defense of my patent at the USPTO. I was forced to bear the total cost of that alone. After seven years of validity proceedings, which have cost more than $250,000, the Patent Trial and Appeal Board (PTAB) has invalidated all 12 of my claims covering the Zip-It. How can the USPTO issue a patent with 12 claims and then use the PTAB to neuter my patent? Since this has been going back and forth with the court system, there are now numerous other entities which have engaged in copying and infringing my patented invention.

In October 2016, the creators of the classic mockumentary film This Is Spinal Tap filed suit against a group of defendants including the French mass media conglomerate Vivendi S.A. alleging that Vivendi engaged in anticompetitive business activities to defraud the Spinal Tap creators of profits earned from the movie. On August 28th of this year, U.S. District Judge Dolly Gee of the Central District of California allowed the case to move forward by denying a motion filed by defendants to dismiss the case based on the economic loss rule, a rule that otherwise operates to require recovery of damages under contract rather than for an action for fraud. Judge Gee also determined that copyright reversion claims presented a sufficiently ripe controversy for consideration by the court. 

In its decision, the Federal Circuit noted that the PTAB is entitled to strike arguments improperly raised in a reply brief under 37 CFR § 42.23(b). However, the appellate court disagreed that Ericsson raised a new theory in its reply brief and thus the Board erred in not considering those portions of the reply brief. “The Board’s error was parsing Ericsson’s arguments on reply with too fine of a filter,” the Federal Circuit found. Ericsson’s petition for IPR described how a person with ordinary skill in the art would be familiar with the concept of interleaving. The CAFC further found that the PTAB’s error was exacerbated by the fact that the new claim constructions proposed by Intellectual Ventures after institution gave rise to the significance of interleaving in the proceeding. In light of this, the Federal Circuit found that Ericsson deserved an opportunity to respond to the new construction.

On August 15, 2018, Fall Line Patents, LLC asserted U.S. Patent No. 9,454,748 against a number of companies. Specifically, Fall Line alleged in nine separate lawsuits that the mobile applications provided by AMC Entertainment, McDonald’s, Boston Market, Panda Express, Papa John’s, Pizza Hut, Regal Cinemas, Starbucks, and Zoe’s Kitchen directly infringe at least Claim 1 of the ‘748 patent. All of the lawsuits were filed in the Eastern District of Texas and request permanent injunctions as well as damages.

The result of the ITC investigation was a win for AMD with the issuance of a cease and desist order against Respondent VIZIO, a cease and desist order against Respondent SDI, and a limited exclusion order against Respondents VIZIO, SDI and MediaTek. Rather surprisingly AMD has not issued a press release touting the win and is also not otherwise taking a victory lap. Generally, when a company scores a win of this magnitude, with either a limited exclusion order or a cease and desist order, it is news that is shared far and wide. In this case both a limited exclusion order and two cease and desist orders were obtained, and there hasn’t been as much as a peep from AMD. The fact that AMD has chosen to remain silent suggests negotiations are ongoing and an omnibus settlement may be announced in the coming days or weeks.

The Federal Circuit recently issued a decision that once again addressed the issue of whether an IPR was time-barred. The Court vacated the final written decision of the Patent Trial and Appeal Board (“the Board”) with respect to one of challenged patents because it was time-barred and affirmed the Board’s decision that two other claims from two different patents were invalid as being obvious.See Luminara Worldwide, LLC v. Iancu, Nos. 2017-1629, 2017-1631, 2017-1633, 2018 U.S. App. LEXIS 22836 (Fed. Cir. Aug. 16, 2018) (Before Lourie, Dyk, and Taranto, J.) (Opinion for the court, Dyk, J.)

The United States Court of Appeals for the Federal Circuit recently issued a ruling on discussing the equitable doctrine of implied waiver; a decision that will be particularly important for those participating in the standard setting process and engaging with standard setting organizations, or SSOs as they are sometimes called. According to the Federal Circuit, failure to disclose patents and applications relevant to a standard may render a patent unenforceable based on an implied waiver.  See Core Wireless Licensing S.A.R.L. v. Apple Inc., No. 17-2102, 2018 (Fed Cir. Aug. 16, 2018) (Before Reyna, Bryson, and Hughes, Circuit Judges) (Opinion for the court, Bryson, Circuit Judge).

The Federal Circuit recently affirmed a district court’s “exceptional” case finding under 35 U.S.C. § 285, which resulted in Appellant Rembrandt Technologies paying attorney’s fees to Appellees, a number of communications companies.  The Court, however, vacated the fee award of $51 million and remanded for a new determination of fees. While the Federal Circuit was comfortable affirming this was an exceptional case, the panel explained that the district court award needs to establish some causal connection between the misconduct and the fee award.  See In re Rembrandt Techs. LP Patent Litig., No. 2017-1784, 2018 (Fed. Cir. Aug. 15, 2018) (Before O’Malley, Mayer, and Reyna, J.) (Opinion for the court, O’Malley, J.). 

Litigation finance in the university context is thus particularly valuable. Even for smaller matters, litigation finance shifts spend off the university’s balance sheet, allowing it to put its own capital to use in its primary endeavors: Education and innovation. For larger matters, litigation finance shifts risk from the university—which, despite its diverse technology portfolio, may have only a small number of claims with attractive litigation prospects—to an entity with a much larger book of diversified risk across uncorrelated claimants.

The Federal Circuit continues to focus on the distinction between an improvement in computer capabilities and an abstract idea for which computers are invoked merely as a tool.  Here, in the context of a database, the Court distinguished between “an improvement to the information stored by a database” and “an improvement in the database’s function”—the former being what the patent covered and also patent-ineligible subject matter.  The Court also rejected multiple arguments related to the breadth of the patents, finding that a narrowed application or scope was not sufficient to meet either step of Alice. 

In Click-To-Call Technologies v. Ingenio, Inc., Yellowpages.com, LLC, the Federal Circuit, sitting en banc, held §315(b) precludes IPR institution when the IPR petitioner was served with a complaint for patent infringement more than one year before filing its petition, even if the district court action in which the petitioner was so served was voluntarily dismissed without prejudice.  

LOT Network markets itself as a non-profit consortium, which offers its members a legal mechanism affording them protection from patent assertion entities (PAEs) and immunizes its members against patent suits from non-operating entities for about 1.2 million worldwide patent assets currently owned by LOT members… The LOT Network conditional license only applies to patents that are in network at the time that a firm joins the consortium. If a business joins LOT after a LOT member sells a patent, previous LOT members are protected by the conditional license whereas the new member still faces the potential of an infringement suit down the road on that patent.

While the changes to the Trial Practice Guide begin to move the rules in the right direction, more is needed before post-grant proceedings will be accepted as neutral to all parties.  The PTAB should endeavor to adopt the time-honored burdens, presumptions and procedures used in the district courts for trying patent cases whenever reasonably possible.  Petitioners should be required to prove that the art upon which they rely is not cumulative to that previously before the USPTO, a patent owner’s Preliminary Response presenting evidence raising genuine issues of material fact should be treated as it would be if presented in opposition to a summary judgment motion brought in the courts, and the presiding panel should determine witness credibility by hearing testimony and cross examination live.

On June 25th, the the U.S. Supreme Court agreed to hear Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA Inc., on appeal from the Federal Circuit. The case will ask the Supreme Court to decide whether an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention under the terms of the Leahy-Smith America Invents Act (AIA). In other words, is a secret sale prior art? To assess some of the reasons why the Supreme Court likely decided to take up Helsinn’s appeal, and some of the arguments we are sure to see again at the merits stage, we explore some of the amicus briefs filed with the Supreme Court encouraging them to take up the case on appeal.

The patent process is long and complex, but well worth the effort if it means protecting your invention and your new company. Key decisions made along the way can help simplify future steps in the process and make obtaining a patent significantly more efficient. Early on, determining a patent scope through patentability searches can help narrow a patent application to the important novel aspects that are most worthwhile to protect. Similarly, preparing a thorough provisional application can make the non-provisional application preparation much simpler and afford better protection against later published works or filings by others. By thinking about these key decisions ahead of time and being aware of the patent process, you can be more prepared when the time comes to seek protection for your invention.