We’re dedicated to providing in-depth analysis of innovations coming from the top developers of consumer electronics in IPWatchdog’s Companies We Follow series, and Apple is one corporation we return to again and again. Apple often makes waves in the media for its imaginative inventions expressed in patent applications filed with the U.S. Patent and Trademark Office. Today, we’ve dug a little deeper to find other patent applications and recently issued patents which may be of great interest to our readers.
As always, we start with a close look at one featured patent application, and we were intrigued by one technology designed to encourage group completion of fitness activities. This lifestyle companion system can also suggest fitness activities to users based on personal interviews conducted by the system. Other inventions directed at personalized services, including a method of creating avatars reflecting a user’s current emotional state, are also described in a series of patent applications discussed in today’s column.
Earlier today the United States Supreme Court issued another of the many intellectual property related decisions the Court took during the October 2013 term. In this case, POM Wonderful LLC v. The Coca-Cola Company, the Supreme Court reversed a decision from the Ninth Circuit that held that within the realm of labeling for food and beverages, a Lanham Act claim asserting that the label is deceptive and misleading is precluded by the Federal Food, Drug, and Cosmetic Act (FDCA). The Supreme Court ruled that a claim brought pursuant to the Lanham Act, which makes deceptive and misleading advertising actionable under 15 U.S.C. § 1125(a), is not precluded by the FDCA, which forbids the misbranding of food, including by means of false or misleading labeling.
This case arose relating to the belief of POM that claims made by the Coca-Cola Company were misleading with respect to a juice blend sold by Coca-Cola’s Minute Maid division. The juice sold by Coca-Cola prominently displays the words “pomegranate blueberry,” but in truth the product contains only .3% pomegranate juice and only .2% blueberry juice.
In a unanimous ruling delivered by Justice Kennedy (minus Justice Breyer who took no part in the decision) explained that there is no text within the statutes that would support the contention that the FDCA precludes Lanham Act claims. Indeed, the Supreme Court specifically found the FDCA and the Lanham Act to complement each other.
Never before has IPWatchdog’s Companies We Follow series focused its attention on this Taiwanese multinational corporation, but today we wanted to take our first perusal of the innovations coming out of the research facilities of this electronics manufacturer. The U.S. Patent and Trademark Office handles a wide degree of patent application filings from Foxconn. The large amount of patent applications and recently issued patents pertaining to improvements to electronic components and manufacturing methods are largely consistent with the corporation’s main operational focus.
Our first foray into the innovations coming from Hon Hai Precision begins with a look at our featured patent application, which describes a method for assembling a fan rotor for cooling of electronic components. This method provides superior fan security and durability through a cost-effective method of attaching a shaft to a fan hub. Other patent applications describe some fairly unique innovations which stirred our imaginations, including an electronic blackboard as well as a method of simulating boomerang flight paths through a mobile device.
In advance of his presentation next week I reached out to Lemley to discuss what is going on and what accounts for the rise in patent damages observed in the Lex Machina report that will be released in conjunction with the panel discussion. I reached him yesterday at his office, and our conversation lasted approximately 30 minutes.
My first question to Lemley was why are patent damage awards increasing? Is this in response to any particular case or event? “An interesting question,” Lemley responded. “There is not a recent case that extends the scope of damages; if anything most of the cases seem to be moving in the opposite direction, such as doing away with 25% rule, for example.”
I would have to agree. I don’t believe any Federal Circuit or Supreme Court cases over the last year or two have made it more hospitable for patent owners seeking hefty damages. Indeed, it seems that the Federal Circuit has seemed to make it more difficult to achieve high damage awards. Lemley agreed: “Even as we are seeing the law get tighter we are seeing an increase in damage awards.”
Back in 2012, I discussed in a two-part article (here and here) the conundrum created by the Federal Circuit’s joint infringement doctrine, as particularly reflected in its extremely discordant and fragmented en banc decision of almost 100 total pages in the combined cases of Akamai Technologies, Inc. v. Limelight Networks, Inc. and McKesson Technologies, Inc. v. Epic Systems Corp. In an opinion over 30 pages long, a bare six judge per curiam majority found it unnecessary to resolve the joint infringement issue. Instead, the per curiam majority ruled that the Akamai Technologies and McKesson Technologies cases should be resolved by applying the doctrine of inducing (indirect) infringement under Section 271(b). The majority also ruled that such indirect infringement could occur as long as all steps of the claimed method are performed, but didn’t requiring that all steps be performed by a single actor.
In a decision barely reaching 11 pages, a unanimous Supreme Court in Limelight Networks, Inc. v. Akamai Technologies reversed and remanded the Federal Circuit’s per curiam majority ruling in Akamai Technologies and McKesson Technologies. That the Supreme Court overturned the Federal Circuit’s per curiam majority ruling is not a surprise. But what is truly shocking are the factually inaccurate statements, as well as the problematical reasoning that appears in Justice Alito’s opinion for this unanimous Supreme Court. With all due respect, Alito’s opinion is an abysmal “comedy of errors.” (In terms of one factually inaccurate statement, Alito’s opinion has been characterized as “embarrassing” and rightly.)
Canada is not the first country that comes to mind as a threat to U.S. trade. After all, Canada is our largest goods trading partner, with $632 billion in total goods traded bilaterally during 2013. Canada was one of America’s first free trade agreement partners, and the importance of the North American Free Trade Agreement (NAFTA) is demonstrated by the continuing economic integration between the two countries. Most recently, the U.S. and Canada have undertaken bilateral dialogues on border security issues (Beyond the Border) and regulatory cooperation (the U.S.-Canada Regulatory Cooperation Council).
While the good news of U.S.-Canada trade cooperation is well-recognized, this doesn’t mean the trading relationship is always smooth sailing. A trade dispute over Canada’s subsidies for softwood lumber has been an irritant for over two decades and Canada has voiced strong concerns over U.S. government procurement practices. Over the last decade U.S. pharmaceutical companies have faced trade challenges in the form of a narrow interpretation of patent eligibility in Canada. Canada’s patent utility provisions are a serious threat to U.S. innovative industries, and therefore are legitimately being raised in NAFTA’s dispute settlement system.
Knowing when to give up on a patent application is one of the most critical questions facing for any patent applicant, whether they be an independent inventor or a large corporation. Resources are finite even for the largest corporations, and throwing good money after bad is not a strategy for success.
When you do not want to give up on a patent application filing an RCE can be an extremely attractive option compared with the cost and delay associated with filing an appeal to the Patent Trial and Appeal Board within the United States Patent and Trademark Office. The filing of the first RCE for a small entity costs $600, and the cost of filing a second or subsequent RCE for a small entity costs $850. These fees are double for large entities, and half as much for those that qualify as micro-entities. Filing an RCE also gives the applicant another two attempts, generally speaking, to convince the examiner that patentable claims are present in the application.
Filing an Appeal is a decision that many applicants simply forego at all costs. The cost of filing a Notice of Appeal is currently $400 for a small entity, double that for a large entity, and half as much for those that qualify as micro-entities. If you want an oral hearing that adds $650 for small entities, $1,300 for large entities and $325 for micro-entities. But the real cost of moving forward on appeal is the attorneys fees that will be encountered. According to the 2013 Economic Survey of the American Intellectual Property Law Association (AIPLA), the median attorney cost for preparing a brief is $4,500, and the median cost for those appeals that include an oral argument raises by another $4,100. Compare this with the filing of an RCE, which depending on the complexity of the technology will vary between about $2,000 to $3,500.
Justice Samuel Alito, authored the Limelight decision for a unanimous Court.
There are some who are questioning the wisdom and correctness of the Supreme Court’s recent decision, authored by Justice Alito for a unanimous Court, in Limelight Networks, Inc. v. Akamai Technologies, Inc. One particular point of criticism seems to be centered around the fact that the Supreme Court failed to take into consideration the existence of 35 U.S.C. § 271(f). Section 271(f) was enacted by Congress to overrule a 1972 Supreme Court decision that held that supplying parts to be assembled outside the United States could not result in infringement of a U.S. patented combination machine because the assembly occurred outside the territorial reach of the U.S., and therefore beyond the scope of the exclusive rights granted by a U.S. patent.
We recognize that certain Supreme Court patent decisions over the past several generations have legitimately raised questions about the Court’s familiarity with overall patent law concepts. Indeed, the Supreme Court has been criticized, including here on IPWatchdog.com, for muddying patent waters, failing to articulate clearly applicable standards and promulgating rulings that seem internally inconsistent, if not scientifically inaccurate. Any legitimate criticism of Supreme Court patent jurisprudence should, however, be on a case-by-case basis. Further, it is important to recognize that the Supreme Court does from time to time get a patent decision perfectly correct. See Diamond v. Chakrabarty, Diamond v. Diehr, Octane Fitness v. ICON Health & Fitness, Highmark v. Allcare, Gunn v. Minton, Bowman v. Monsanto, i4i v. Microsoft and Kappos v. Hyatt.
This current criticism swirling around Limelight seems misguided. Arguing that the Supreme Court erred by misinterpreting, or failing to apply, 271(f) misses the point entirely. The question presented in the appeal to the Supreme Court was whether there can be infringement under 271(b) if there is no direct infringement under 271(a). Infringement under 271(f)(1) was not at issue in the case, and 271(f)(1) was not relied upon by the Federal Circuit below.