Posts Tagged: "Patentability"

On October 30, the Senate Judiciary Committee’s Subcommittee on Intellectual Property heard from five witnesses on ways to improve patent quality at the United States Patent and Trademark Office (USPTO). The Subcommittee subsequently posed questions to the witnesses, including professors Colleen Chien, R. Polk Wagner, and Melissa Wasserman, to supplement their testimony. Those witnesses have now submitted their responses, which expand upon their various suggestions for improving patent quality.

Last week, the U.S. Court of Appeals for the Federal Circuit (CAFC) reviewed an appeal of the PTAB’s final decision that Game and Technology Co. Ltd.’s (GAT) Patent No. 7,682,243 (the ‘243 patent) was obvious over the prior art, and that inter partes review (IPR) was not barred under 35 U.S.C. § 315(b). The CAFC held that the PTAB properly asserted that claims 1-7 of patent ‘243 were obvious in light of the prior art and that an IPR was not barred because the petitioner, Wargaming Group Limited (Wargaming), was not properly served with a complaint alleging infringement of the [‘243] patent over a year before it filed its petition for an IPR.

If you innovate and invest more than $10,000 to obtain patent protection on your idea, do you trust a government-issued patent to be a valid one?  And if you believe you have a valid patent, would you trust that government’s judicial system to protect you from sanctions for believing in its validity? These underlying assumptions provide the foundation to any system. If you purchase and obtain title to a car, stock, or real estate, you expect that title to be valid. And you expect not to be penalized for believing in that title’s validity.     For patents, it’s quite the opposite. It has become so commonplace for government-issued patents to be invalidated after issuance, we hardly bat an eye. But with the development of Section 101 law, the patent system has turned down a twisted path—one that sanctions patent holders for believing their patent to be valid. In Finnavations LLC v. Payoneer, Inc., the U.S. District court for the District of Delaware unfortunately advanced our patent system down this path

“It’s up to you to do the right thing and fix this,” said Professor Arti Rai of The Center for Innovation Policy at Duke University School of Law near the end of a hearing on what Congress should do in the wake of the Arthrex decision yesterday. Rai was one of four IP scholars who testified during the hearing of the House Judiciary Committee’s Subcommittee on Courts, Intellectual Property and the Internet; all witnesses seemed to agree that the courts will not fix the problem soon enough to ensure the requisite certainty for U.S. patent owners and businesses, so Congress must act. In Arthrex, the Federal Circuit found that the Patent Trial and Appeal Board’s (PTAB’s) Administrative Patent Judges (APJs) were unconstitutionally appointed and removed the civil service protections they previously were deemed to enjoy—although, as Professor John Duffy of the University of Virginia School of Law pointed out, if the Federal Circuit ruled that the APJs can’t have tenure, that arguably means they never did. “If you go back to Marbury v. Madison, courts don’t actually strike down statutes; they simply say what the law is,” Duffy said.

On November 13, the Court of Appeals for the Federal Circuit (CAFC) heard an appeal from the U.S. District Court for the Southern District of California in the case of Columbia Sportswear North America, Inc. v. Seirus Innovative Accessories, Inc. (Seirus). Columbia appealed the judgment from a jury trial holding claims 2 and 23 of U.S. Patent 8,453,270 (the ‘270 patent) invalid as anticipated and obvious. Seirus cross-appealed from a grant of summary judgment by the U.S. District Court for the District of Oregon, holding tSeirushat Seirus infringed U.S. Design Patent No. D657,093 (the ‘093 patent). The CAFC affirmed that claims 2 and 23 of the ‘270 patent were invalid, reversed the summary judgment decision against Seirus for infringement of the ‘093 patent and remanded for further proceedings on the design patent.

The U.S. Court of Appeals for the Federal Circuit (CAFC), in an opinion authored by Judge Chen, on Friday November 15 reversed a ruling of the District Court for the District of Delaware holding Koninklijke KPN N.V.’s (KPN’s) U.S. Patent No. 6,212,662 (the ‘662 patent) ineligible under Section 101. The patent covers a method that varies “check data” to reduce systematic errors in electronic transmissions. KPN sued Gemalto M2M GMBH (Gemalto) in the district court and Gemalto moved under Rule 12(c) for a judgment on the pleadings, arguing that claims 1-4 of the ‘662 patent were ineligible under 35 U.S.C § 101, which the district court granted. KPN appealed on claims 2-4, stating that they present “a non-abstract improvement in the functionality of an existing technological process and not simply an abstract idea of manipulating data.”

As I have previously reported on KSJ Law, the Patent Trial and Appeal Board (PTAB) issued 80 decisions on appeals in October, and reversed the examiner in 24 of those. Claim construction was at issue in several, and the PTAB made several comments, supported by case law, that will be useful to those laboring against “broadest reasonable interpretations” that are, in fact, not reasonable. Taken together, these recent decisions provide a road map for first arguing against a broadest reasonable interpretation that is overly broad and unreasonable, thereby supporting the conclusion that a prima facie case against the properly construed claims has not been made.

Chestnut Hill Sound, Inc. has filed a petition asking the U.S. Supreme Court to consider whether the Federal Circuit’s disparate practice with respect to issuing Rule 36 decisions for losing patent owner-appellants versus losing petitioner-appellants is constitutional. The petition includes statistics demonstrating that patent owner-appellants are three times more likely to receive a Rule 36 judgment than petitioner-appellants. Chestnut Hill’s petition cites statistics on the number of Rule 36 decisions being issued, which come from Larry Sandell’s article, What Statistical Analysis Reveals About Winning IPR Appeals, LAW 360 (August 8, 2019, 5: 22 PM). A footnote in the petition explains that the likelihood of patent owner-appellants receiving a Rule 36 affirmance is actually closer to 3.6 than 3. “Since a losing Patent Owner- Appellant has a 66% chance of receiving a Rule 36 opinion, and a losing Petitioner- Appellant has an 18% chance of receiving a Rule 36 opinion, a Patent Owner- Appellant is 3.6 times as likely to receive a one- word affirmation than a Petitioner- Appellant,” says the petition.

Petitioners challenging patents covering pharmaceuticals and biologics often use drug product labels as prior art in the Patent Trial and Appeal Board (PTAB). To effectively use a label as prior art, a petitioner must show that it is a “printed publication” under 35 U.S.C. §§ 102 and 311(b). Past PTAB cases demonstrate, however, that proving drug product labels as prior art can be fraught with danger. But practitioners can employ best practices to guard against this. In Celltrion, Inc. v. Biogen, Inc., IPR2016-01614, Paper 65 (Feb. 21, 2018), the Petitioners relied on a copyrighted label for Rituxan that was published on the internet and available on the Food and Drug Administration’s (FDA’s) and on Biogen’s website all before the critical date. The Board held that the Petitioners did not provide sufficient evidence establishing that the drug label was indeed the one disseminated with Rituxan at the time it was proposed to be publicly available or that “persons interested and ordinarily skilled in the subject matter or art exercising reasonable diligence, can locate it.” Similarly, the Board held in Mylan Pharmaceuticals Inc. v. Boehringer Ingelheim International GMBH, IPR2016-01563, Paper 16 (Feb. 3, 2017), that a relied-upon Glucophage label had no source identifying information or indicia of when it became publicly available and the declaration attesting to its publication was not based on personal knowledge, but was merely conclusory.

Jury verdicts are supposed to be sacrosanct. The biggest opposition to the ratification of our Constitution in 1788 was due to its lack of protection for jury trials in civil cases. The omission was corrected by adding the Seventh Amendment as part of the Bill of Rights. So, when a patent holder wins a jury verdict, that should mean more than the paper the verdict is written on. Yet it does not, under recent decisions by the U.S. Court of Appeals for the Federal Circuit. On behalf of Eagle Forum Education & Legal Defense Fund, I filed an amicus brief on November 4 in support of a petition for rehearing en banc by the full Federal Circuit to end the abusive authority of the Patent Trial and Appeal Board (PTAB) to overturn jury verdicts. Many other amicus briefs were subsequently filed in this case, Chrimar Systems, Inc. v. ALE USA, Inc. FKA Alcatel-Lucent Enterprise USA, Inc. (Fed. Circ. Case No. 18-2420), to make similar requests of the Federal Circuit

It’s that time of the year—Halloween candy is still lingering in bowls, turkey and dressing is tantalizingly close, holiday cheer abounds. While winter skies are overhead, Congress is working to strengthen the U.S. Patent system with the STRONGER Patents Act. The bill was most recently debated by the Senate Judiciary Committee’s IP Subcommittee in September and has stolen the spotlight from the Section 101 reform debate, which for the moment seems to have stalled. Much has been written about the main provisions of the STRONGER Act, such as making inter partes review (IPR) and district court standards and procedures the same. Like extra Halloween candy or Aunt Imelda’s sweet potato pone, Congress has included a number of extra goodies for patent owners that have not been widely appreciated.

This week in Other Barks & Bites: the Trump Administration sues Gilead for infringement over HIVE PrEP treatment patents; Senators Inhofe and Wicker ask President Trump to show no leniency on Chinese IP theft; the Supreme Court hears the Allen v. Cooper copyright appeal; the Federal Circuit issues precedential opinions on PTAB evidence admissibility and limitation in patent claim preamble; the Copyright Office says that its digital recordation pilot project is on track for Spring 2020; the PTAB Precedential Opinion Panel (POP) will review the Board’s rejection of substitute patent claims in a motion to amend; “This Is Spinal Tap” creators settle copyright suit; and T-Mobile announces December launch for nationwide 5G network.

Two days ago, TechCrunch published an article touting an important victory by Cloudflare against an evil patent troll—Blackbird Technologies. In the article there is no mention of any inappropriate tactics used by Blackbird, and there is nothing to suggest that Cloudflare was not infringing the patents they were accused to have infringed. In fact, that article seems to practically admit that Cloudflare was infringing on the patents because the defense tactic used by Cloudflare was not to argue that they were not infringing, but instead to argue that the patent claims asserted were invalid. Indeed, on November 4, Cloudflare published a description of their strategy, which does not mention anything about demonstrating that they were not infringing the patents issued by the United States Patent and Trademark Office (USPTO). Instead, the strategy was to: (1) not settle; (2) make a public cry for help and seek the submission of prior art that might invalidate the patent claims they were facing; and (3) file ethics complaints against the attorneys representing Blackbird. In this case, the Blackbird patent claims were found invalid. Cheering for Cloudflare, who had no reason to know that at the time they recklessly infringed those claims, is beyond the pale and speaks volumes as to why innovators are leaving America and heading to Europe, China and elsewhere around the world.

Everybody in the patent world is talking about the latest atrocity from the Federal Circuit known as the American Axle decision, but few actually appreciate the true level of absurdity. Yes, 35 U.S.C. § 101 swallowed §§ 112(a), 112(f), 102, and 103 in a single decision (a new feat of judicial acrobatics), and Judges Taranto and Dyk displayed their technical ignorance. For example, in citing the Flook decision Judges Dyk and Taranto assert that Flook’s mathematical formula (known to a million-plus engineers as the steepest-descent algorithm) is a “natural law.” American Axle, slip op. at p. 19. Seriously? Are Federal Circuit judges so technically ignorant that the entirety of the country is doomed to believe such an idiotic fantasy that a particular adaptive mathematical algorithm associated with no natural law must be a natural law? 

What I tried to do for this presentation is figure out in about seven or eight minutes how I could convey to you what’s really going on in the United States. Because, frankly, it is a mess. The patent system in the United States, for those of you who are unfamiliar, is extraordinarily weakened from where it was 12 years ago. Getting an injunction in the United States is simply not possible anymore in litigation, except for in the most extreme situations. Over the last 12 years, the U.S. patent system largely has become a compulsory licensing system, and increasingly so. This obviously has ramifications for all patent owners. And during this time period, Congress also passed the America Invents Act, which created what’s known as the Patent Trial and Appeal Board (PTAB), which has made it more easy to invalidate patents in the United States. As it turns out, 90% of patents that actually get to a final decision at the PTAB are found to have a mistake.