Justice Alito began the decision with this summation:
“This case presents the question whether a defendant may be liable for inducing infringement of a patent under 35 U. S. C. §271(b) when no one has directly infringed thepatent under §271(a) or any other statutory provision. The statutory text and structure and our prior case law require that we answer this question in the negative. We accordingly reverse the Federal Circuit, which reached the opposite conclusion.”
At issue was the alleged infringement of U. S. Patent No. 6,108,703 (’703 patent), which claims a method of delivering electronic data using a “content delivery network,” or “CDN.” The ’703 patent also provides for the designation of certain components of a content provider’s website to be stored on Akamai servers. The process of determining which component to store on Akamai servers was known as “tagging.”
Earlier today the United States Supreme Court handed down its decision in Nautilis Inc. v. Biosig Instruments, Inc., which dealt with the appropriate standard for indefiniteness under 35 U.S.C. 112(b). It should be noted, however, if you read the case you will see mention of 35 U.S.C. 112, ¶ 2, which was the section of 112 at issue in the case. Congress has since relabeled section 112 to sections (a) through (f). In any event, the statute at issue reads as follows: “The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the inventor or a joint inventor regards as the invention.” This is the section that defines the so-called definiteness requirement for patent claims.
In an opinion delivered by Justice Ginsburg for a unanimous court, the Federal Circuit was overruled, although it may wind up being much ado about nothing because it seems that the Supreme Court was concerned with the language used to articulate the indefiniteness standard, not specifically whether the claims at issue were indefinite.
The patent in dispute, U. S. Patent No. 5,337,753 (’753 patent), issued to Dr. Gregory Lekhtman in 1994 and assigned to respondent Biosig Instruments, Inc., concerns a heart-rate monitor for use during exercise. Claim 1 of the ‘753 patent covers a heart monitor, and in two places uses the term “spaced relationship.”
By now much of the patent world likely already knows that Chief Judge Randall Rader has announced that he will step down as Chief Judge of the United States Court of Appeals for the Federal Circuit effective May 30, 2014. Many in the popular press are tying his decision to step down to his recent recusals, which were necessitated by an ill-advised email sent by Judge Rader praising a member of the patent bar that routinely appears before the Federal Circuit. On May 23, 2014, Judge Rader sent a letter to all of the other Judges on the Federal Circuit apologizing for his lapse in judgment and for the need to recuse himself. Given the timing of Judge Rader’s decision to step down and his apology letter it is easy to understand why many are speculating that the two are connected.
Given the anti-patent climate that has been created by major Silicon Valley technology companies, the Obama Administration and certain Members of Congress, the news that Judge Rader will step down as Chief Judge comes at a difficult time. As innovators celebrated the defeat of the latest round of patent legislation that would have weakened the patent system and patent rights generally, the industry is now face with losing Judge Rader, at least to some extent.
Judge Rader will stay on the Federal Circuit, he will continue to teach, lecture and travel, spreading the positive patent message that he delivers so uniquely well. Even though the Chief Judge is really only a leader among equals, there is no doubt that a bully pulpit is provided to a Chief Judge. Judge Rader was willing to talk about the virtues of the U.S. patent system generally, and continually raised issues relevant to businesses both small and large that innovate. His absence at this critical time will be missed.
EDITOR’S NOTE: What appears below are the prepared remarks for “The Honorable Howard T. Markey Distinguished Lecture on Intellectual Property Law,” given by Don Dunner at the John Marshall Law School on November 12, 2010. In light of the recent announcement that Chief Judge Rader will be stepping down as Chief Judge, Dunner granted us permission to publish this piece.
The title of my lecture today is “The Evolution of Patent Jurisprudence … from Giles Rich to Howard Markey to Randall Rader.” Why, you might ask, am I restricting myself to these three jurists if my subject is “The Evolution of Patent Jurisprudence”? Why not start at the beginning, for example, and talk of Article I, Section 8, Clause 8 of the Constitution, or the first patent act in 1790, or the beginning of the patent examination system in 1836, or the patent writings of Judge Learned Hand.
Those of you who are familiar with my career will know the answer: My 55 year career in patent law spans almost exactly the judicial tenures of Judges Rich, Markey and Rader. I have been specially blessed with my extensive interactions with all three judges, not to mention numerous oral arguments that I have been privileged to make before them. And so it seemed to me appropriate to spend my time today sharing my recollections and thoughts about these three giants of the patent profession.
Chief Judge Randall R. Rader today announced that he will step down as Chief Judge of the United States Court of Appeals for the Federal Circuit on May 30, 2014. Judge Rader will continue in active service on the Court, although the official announcement says that he will also undertake additional teaching, lecturing and travel.
This surprise announcement by Judge Rader, who turned 65 on April 29, 2014, means that Judge Sharon Prost will become the next Chief Judge of the Federal Circuit. Had Judge Rader served his entire term as Chief Judge succession rules would have meant that the title of Chief Judge would pass Judge Prost and go on to Judge Moore, who remains next in line after Judge Prost.
On Friday, May 9, 2014, the United States Court of Appeals upheld sanctions leveled against E.I. Du Pont de Nemours and Company and its subsidiary Pioneer Hi-Bred International, Inc. (collectively “DuPont”) by the United States District Court for the Eastern District of Missouri. See Monsanto Co. v. E.I. Du Pont De Nemours and Co.
DuPont had appealed from orders of the district court, which had imposed sanctions on DuPont by striking DuPont’s contract reformation defense and counterclaims and awarding Monsanto Company and Monsanto Technology, LLC (collectively “Monsanto”) attorney fees. Finding that the district court did not abuse its discretion the Federal Circuited affirmed the sanctions.
Monsanto developed a genetic modification in soybean seeds, marketed under the Roundup Ready® (“RR”) brand name and known as the 40-3-2 event (the “RR trait”), which enables soybean plants to tolerate the application of glyphosate herbicide that kills weeds. Monsanto obtained U.S. Patent RE 39,247E (the “’247 Patent”), which covers the RR trait, and granted Pioneer Hi-Bred International, Inc. (“Pioneer”) a nonexclusive license to produce and sell soybean seeds containing Monsanto’s glyphosate-tolerant traits. After Pioneer became a subsidiary of DuPont, Monsanto and Pioneer entered into an Amended and Restated Roundup Ready® Soybean License Agreement on April 1, 2002 (the “License”), which superseded the 1992 license.
Earlier today the United States Court of Appeals for the Federal Circuit ruled that Dolly the cloned sheep, and any other genetic clones, are patent ineligible in the United States because the “claimed clones are exact genetic copies of patent ineligible subject matter.” The case decided was In re Roslin Institute(Fed. Cir. May 8, 2014).
The Roslin Institute of Edinburgh, Scotland (Roslin) is the assignee of U.S. Patent Application No. 09/225,233 (the ’233 application) and had appealed from a final decision of the Patent Trial and Appeal Board, which held that all of Roslin’s pending claims were unpatentable subject matter under 35 U.S.C. § 101. The Board also rejected Roslin’s claims as anticipated and obvious under 35 U.S.C. §§ 102 and 103. Having determined that genetic clones are not patent eligible the Federal Circuit, in a decision by Judge Dyk who was joined by Judges Moore and Wallach, did not reach the 102 or 103 issues, instead simply affirming the Board’s rejection of the claims under § 101.
To tell the story involved in this case we must travel back to July 5, 1996, when Keith Henry Stockman Campbell and Ian Wilmut successfully produced the first ever cloned mammal from an adult somatic cell: Dolly the Sheep. The cloning method Campbell and Wilmut used to create Dolly was a significant scientific breakthrough. Campbell and Wilmut obtained U.S. Patent No. 7,514,258 (the ’258 patent) on the somatic method of cloning mammals, which was been assigned to Roslin. The ’258 patent was not at issue in this case.
The Federal Circuit has affirmed once again—this time in a sharply divided en banc decision—that it will subject a district court’s claim construction to de novo review on appeal. The case is Lighting Ballast Control v. Philips, and the appeal was the latest challenge to the standard of review set by the Federal Circuit over 15 years ago in Cybor Corp. v. FAS Technologies, Inc.
On the surface, this question of patent procedural law seems innocuous enough, but a glance at the title pages of the numerous amicus briefs (filed by an impressive roster of academic commentators and industry heavyweights) shows otherwise. The question of the appropriate standard of review for claim construction rulings is of immense importance to the patent bar.
At stake in Lighting Ballast was the Federal Circuit’s ruling 15 years ago in Cybor,that claim construction is subject to de novo review at the appellate level, despite the fact that the interpretation of patent terms often has factual underpinnings, a domain where trial judges are usually given a wide berth and significant deference. As the Supreme Court recognized in its landmark decision in Markman v. Westview Instruments, decided in 1996 shortly before Cybor, claim construction is a “mongrel practice” of both law and fact that often involves “construing a term of art following receipt of evidence.”
Cybor has been criticized both by Federal Circuit judges and by outside commentators, with most critics deriding Cybor’s blindness to the factual issues that are often implicit in the interpretation of what a patent means. While the question can sometimes be answered by reference to the terms of the patent alone—a traditional legal inquiry—it oftentimes also requires extrinsic evidence and the opinions of dueling experts on the state of the art and the technology in question—factual issues traditionally left alone absent “clear error.”
In Kilopass Tech., Inc. v. Sidense Corp. (Fed. Cir. December 26, 2013), in a 2-1 decision, the majority suggested that the fee shifting provisions of 35 U.S.C. §285 have broader application and are not applicable only when subjective bad faith and objective baseless claims are found. The push for broader application for the existing fee shifting statutory provisions is particularly relevant since there has been an increase in media coverage about certain abusive litigation tactics of patent trolls. This case might signal a nod to the district courts to apply the fee shifting provisions when trolling behaviors are practiced by the patent owner.
In this case, the District Court focused on the subject of bad faith prong and the objectively baseless prong to prove that the case is exceptional as required under 35 U.S.C. §285 for the fee shifting provisions to kick in. However, the Federal Circuit reiterated that 35 U.S.C. §285 allows for fee shifting in other situations than solely in those situations where the objective and subjective prongs are proven.
The Defendant (Sidense) was granted summary judgment holding that Sidense did not infringe the patent owner’s patent (Kilopass). Thereafter, the Defendant filed a motion in the District Court seeking an award of attorney’s fees under 35 U.S.C. §285, which the District Court denied. Sidense then appealed. This case provides a litany of points argued by the defendant as to why attorney fees should be awarded. The Federal Circuit agreed on some but rejected others.
There’s an old expression that Murphy (of Murphy’s Law fame) “was an optimist.” That expression certainly applies to the recent Federal Circuit panel decision in Novartis AG v. Lee, as well as the companion decision in Exelixis, Inc. v. Lee on the meaning of the Patent Term Adjustment (PTA) Statute (35 U.S.C. § 154(b)), and particularly what’s called the “B period” portion (i.e., 35 U.S.C. § 154(b)(1)(B)) of PTA. In Novartis, this Federal Circuit panel (opinion by Judge Taranto, joined by Judges Newman and Dyk) ruled that the second exclusion from PTA in the “B period” portion (i.e., 35 U.S.C. § 154(b)(1)(B)(ii)) excludes from PTA any time consumed by a Request for Continued Examination (RCE), even if that RCE is filed more than 3 years after the “actual filing date” of the patent application. Not only is this ruling a questionable interpretation of 35 U.S.C. § 154(b)(1)(B)(ii) for reasons I’ll discuss below, but it creates an unfortunate, and surely unintended impact on RCEs specifically, as well as continuation practice generally. And the more I dig into the PTA statute, the more problematical this ruling in Novartis becomes.
Novartis also addresses another thorny issue of when a patent applicant dissatisfied with the PTA determination by the USPTO may timely challenge such a determination (i.e., 35 U.S.C. § 154(b)(4)(A) (and which also went against the patentee, Novartis), but I’m going to focus solely on the B period exclusion issue. I’m also going to provide here a summary of the PTA statute as it relates to these 3 periods used for determining the cumulative PTA that the patent applicant gets. See the 2012 Eastern District of Virginia’s decision in Exelixis, Inc. v. Kappos which was vacated by the Federal Circuit’s companion decision to Novartis, and provides a nice, concise explanation of how these 3 periods work for determining the cumulative PTA owed the patent applicant.