Alice-Insanity (Part Three): How the Star Chamber of Madison Place Violates Basic Principles of Collateral Estoppel

“One patent / patent application after another after another is immolated not because there is a single thing wrong with the substance of a single claim, but because the claims are accused of looking ‘similar’ to other claims previously immolated by The Star Chamber of Madison Place.”

https://depositphotos.com/13491865/stock-photo-state-capitol-building-madison.htmlAs stated in Part One of this series, the Fifth Amendment of the U.S. Constitution guarantees, inter alia, that no person shall be deprived of property (including intellectual property), without due process of law. However, the Supreme Court has never held that a single appellate court must comply with Fifth Amendment due process of law.

The closest the Supreme Court ever came to such a radical idea as requiring any appellate court in the nation to comply with due process of law was at a time when “Three’s Company” and “The Muppet Show” dominated the 7PM-9PM Nielsen’s ratings. See Singleton v. Wulff, 428 U.S. 106 (1976) (warning the Eighth Circuit that “injustice was more likely to be caused than avoided by deciding the issue without petitioner’s having had an opportunity to be heard,” but not actually requiring the Eighth Circuit to comply with Fifth Amendment due process). In contrast, the Supreme Court has held that even a man classified as an “enemy combatant” by the U.S. government is entitled to at least some measure of due process. See Hamdi v. Rumsfeld, 542 U.S. 507 (2004).

Le Tribunal des Marsupiaux

Procedures in which violations of due process are so gross that fundamental justice is denied are often referred to as “kangaroo trials.” Such trials deal more in capriciousness than in law. Such trials are rejected by common men bearing common sense.

For example, common sense dictates that a first person should not presumed guilty, much less convicted of a particular crime, merely because a second person with a similar sense of fashion was arrested and convicted for the same crime. Now consider the concept that, not only was the first person convicted, but a third person with the same fashion sense is accused and convicted because the first person was convicted. Sounds absurd? It is! Yet this practice is one of the fundamental pillars of the Alice-Mayo test as is practiced by Federal Courts as, before a single iota of evidence is gathered, the judge before a patent suit dismisses the case as looking too much like another case. One patent / patent application after another after another is immolated not because there is a single thing wrong with the substance of a single claim, but because the claims are accused of looking “similar” to other claims previously immolated by The Star Chamber of Madison Place.

The Big Question

Collateral estoppel is a rule derived from the common law whereby a person is prohibited from re-litigating an issue after the issue was properly decided in a body having subject-matter jurisdiction. This means that an issue of fact or law properly decided against a particular party in one case cannot be re-decided in another case by the same party. There are exceptions to the collateral estoppel rule – all based on fundamental fairness and due process of law – none of which are relevant to this discussion.

A natural question arises re collateral estoppel: when, if ever, is a person rightfully prejudiced by a determination in a separate litigation based on a separate set of facts and circumstances with which said person had no possible involvement or interest? If you’re a constitutional scholar or even a 2L, you’re likely to say “never.”

Yet this practice is another fundamental pillar in the average Alice-Mayo analysis.

Any victim of Alice-Mayo reading this knows of this phenomena. By way of example, a federal district court judge has just compared your claims to the claims in Investpic while ignoring Berkheimer.

What is the basic difference between the claims in Investpic and the claims in Berkheimer?

Answer: N-O-T-H-I-N-G

The only difference in these cases was that one CAFC panel couldn’t be bothered to read the text of 35 U.S.C. § 112(f) and believed that their fine arts degrees, their J.D.s, and their political appointments to The Bench conferred a god-like grasp on all aspects of law and of advanced statistics as such applies to financial analyses. Things like evidence, statutory language, actual Supreme Court precedent, and due process are the concerns of the less gifted. It’s a Dunning-Kruger thing.

This is not to say that a legal rule taken from Investpic cannot be applied. However, what is to be applied? That functional language is verboten in claims despite the statutory language of 35 U.S.C. § 112(f)? That computer-generated data relating to images of animated characters are of  the “physical realm” while images relating to actual markets are not? Berkheimer cannot be reconciled with Investpic, and yet one government employee after another will assert Investpic applies your claims while Berkheimer does not apply. Why is not clear.

Amazingly enough, Judge Taranto, who penned Investpic and was part of the Berkheimer panel, never asserted that the claims in Berkheimer were mental steps in either of the Berkheimer and Berkheimer en banc decisions despite abundant opportunity to do so. Given that the Berkheimer en banc decision was issued about two weeks after the Investpic decision, the divergent outcomes are difficult to resolve. Regardless, because Investpic cannot be resolved with 35 U.S.C. § 112(f), Alice Corp., Bilski, Berkheimer, and reality, the Investpic holding cannot be controlling law.

If the evidence-based holding of Berkheimer is applied, the patent holder wins. If the evidence-based holding of Bilski is applied, the patent holder wins. If the evidence-based holding of Alice Corp. is applied, the patent holder wins. If the evidence-based holding of Mayo. is applied, the patent holder wins. Given that Investpic cannot overrule Alice Corp., Bilski, and Mayo, the only possible way Investpic can possibly apply to the patent holder while Berkheimer, McRO, and Enfish survive is some twisted application of collateral estoppel personal to the patent holder. Admittedly, this application of Investpic analogy to collateral estoppel isn’t perfect, but its far closer to reality than asserting Investpic represents controlling legal precedent.

Pray for Vegas Odds

Every patent applicant / patent holder accused of having claims that look too much like Investpic, Recognicorp, and Electric Power Group, and not enough like Berkheimer, McRO, and DDR Holdings knows the peril. Salvation, if any, lies in the Federal Circuit panel selected for review. Yet now consider the plight of a patent applicant who stands accused of violating Alice-Mayo despite a mountain of evidence favoring said patent applicant because Investpic – a case that said patent applicant had no opportunity to influence and that cannot be reconciled with the statutory patent law, Supreme Court precedent, and a dozen other Federal Circuit decisions issued before and after. Better to blow your hard-earned money in lottery tickets and at the Vegas casinos than invest in an Alice-Mayo appeal and hope the decision goes your way.

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The Author

Burman York (Bud) Mathis III

Burman York (Bud) Mathis III is a sole-practitioner in the Washington D.C. area with experience in patent drafting and prosecution, opinion writing, due diligence, litigation and appellate work. Mr. Mathis technical expertise and experience is far-ranging. For example, Mr. Mathis’ experience covers a wide variety of highly-technical subject matter that includes wired and wireless communications (including MIMO, 3G, 3GPP/LTE, D2D and 4G technology), analog and digital electronics, image processing, semiconductor devices and processes, solid-state physics, material science, printers and copiers, projectors, cameras, speech recognition and synthesis, xerography, cryptography, control systems, magnetic and optical disc technologies, fiber optics, MEMS technologies, nanosensors, GPS navigation systems, software, computer networking and business methods.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 18 Comments comments. Join the discussion.

  1. concerned November 22, 2021 5:22 pm

    Another well written article and exactly our CAFC appeal brief in addition to evidence.

    The patent application also has the PTAB stating the application met the everyday definition of the statutory text but not the legal definition of those terms, which the Solicitor and Board refuse to define those legal terms. According to SCOTUS, the everyday definitions control unless defined otherwise, which the Board and Solicitor refuse to define.

    We do not lose on the legal merits, it uissettled law. We only lose if the CAFC says so.

  2. Curious November 23, 2021 9:44 am

    Not sure that this is a winning argument.

    Yet this practice is one of the fundamental pillars of the Alice-Mayo test as is practiced by Federal Courts as, before a single iota of evidence is gathered, the judge before a patent suit dismisses the case as looking too much like another case.
    When I was a 1L, this was called argument by analogy. The facts are similar, and therefore, the results should be similar. I very much doubt that you’ll get any traction whatsoever with this line of argument.

    If what you are saying is true, then why do we bother to cite prior decisions?

    A very smart person gave me this advice with regard to case law. You should always be arguing either: ‘the facts are the same, and therefore, you should be relying upon XYZ case’ or ‘the facts are different and therefore you shouldn’t be relying upon ABC case.’ This is how you argue case law.

    The USPTO/PTAB made a decision that the facts associated with your claims are similar to that of some Federal Circuit decision. Arguing lack of “due process” isn’t going to help.

    because Investpic – a case that said patent applicant had no opportunity to influence and that cannot be reconciled with the statutory patent law, Supreme Court precedent, and a dozen other Federal Circuit decisions issued before and after
    Then you need to argue that Investpic is bad law. Good luck with that. The only way Investpic becomes bad law is if an en banc panel of the Federal Circuit says that it is bad law or the Supreme Court does the same. However, what are the chances that you’ll get an en banc panel or have the Supreme Court hear your case? Probably less than 1%.

    To reverse Investpic (and others), you are going to need a very sexy invention and/or an important (or otherwise noteworthy) client. You are going to need some incredible facts. You are also going to need a team of experienced appellate lawyers who know what it takes to get a reversal.

    I wish you all the best in fighting the good fight. While I’m sure you have some good arguments to make, I don’t think this is one of them.

  3. TFCFM November 23, 2021 11:15 am

    Article: “…the Fifth Amendment of the U.S. Constitution guarantees, inter alia, that no person shall be deprived of property (including intellectual property), without due process of law.

    That the author (like many, including me) does not fully understand precisely where the ‘boundary’ between abstractness and non-abstractness is or should be for certain kinds of subject matter does not amount to a Due Process violation.

    Without any serious question, the courts are trying to devise and apply a sensible standard for assessing unpatentable “abstractness.” The mere fact that that process is difficult (as evidenced by the inability of anyone to propose an unquestionably-proper and -clear boundary for this issue) does not mean that Due Process demands that “anything goes” in the meantime.

  4. concerned November 23, 2021 11:47 am

    Curious: Thank you for your comments and well wishes.

    I am not an important client or noteworthy, however, there might be a higher authority involved. If you knew my life story you may tend to agree. My first attorney, who did an incredible job, last name is Miracle.

    On a worldly note, the USPTO and PTAB have been all over the place on this application and B is highly gifted. The first examiner said I should get the patent. then a second examiner gets mysteriously assigned.

    Time will tell.

  5. B November 23, 2021 12:59 pm

    @ Curious “When I was a 1L, this was called argument by analogy. The facts are similar, and therefore, the results should be similar. I very much doubt that you’ll get any traction whatsoever with this line of argument.”

    Think carefully.

    You have first Federal Circuit case saying A, a second Federal Circuit case near identical saying NOT A, two Supreme Court cases saying NOT A, and yet there’s a 100% chance the PTAB will say A.

    Argue analogy I understand, but you miss the point.

    “I wish you all the best in fighting the good fight. While I’m sure you have some good arguments to make, I don’t think this is one of them.”

    One last part to this series. You’ll see if it is good or not

  6. B November 23, 2021 1:08 pm

    @ TFCFM “That the author (like many, including me) does not fully understand precisely where the ‘boundary’ between abstractness and non-abstractness is or should be for certain kinds of subject matter does not amount to a Due Process violation.”

    Respectfully, you show a lack of fundamental knowledge of Constitutional due process, or even knowledge of the APA.

    As to “abstractness,” I’d ask you how Investpic is consistent with any Supreme Court case since forty years

    @ Curious “However, what are the chances that you’ll get an en banc panel or have the Supreme Court hear your case? Probably less than 1%.”

    I wouldn’t lay odds being that high re SCOTUS – unless the CAFC holds a due process violation – then it’s 100%.

  7. B November 23, 2021 1:31 pm

    @ TFCFM “Without any serious question, the courts are trying to devise and apply a sensible standard for assessing unpatentable ‘abstractness.’”

    Respectfully, outside Judges Moore and Newman, what would give you such an idiotic notion?

    I would bet you $10,000 that if you challenged the USPTO’s Solicitor circa TWO MONTHS AGO to define “abstract” in a way the CAFC uses that term and that is consistent with Supreme Court precedent, the Solicitor would have totally chickened out LAST WEEK and ignored the challenge.

    I really would take that bet.

  8. concerned November 23, 2021 1:43 pm

    TFCFM: “That the author (like many, including me) does not fully understand precisely where the ‘boundary’ between abstractness and non-abstractness is or should be for certain kinds of subject matter does not amount to a Due Process violation.”

    “Without any serious question, the courts are trying to devise and apply a sensible standard for assessing unpatentable “abstractness.”

    Judge Moore opinion in the American Axle dissent: “Finally, though not a legal question, I am troubled by the deprivation of property rights without due process.”

    My opinion: It is not a sensible standard to toss evidence, admit the statutory text was met but not our undefined version (which we refuse to give you, its apparently a secret) and we will choose to cherry pick the lower court’s opinion over SCOTUS case law.

  9. concerned November 23, 2021 1:52 pm

    Regarding the odds whether SCOTUS will take up the matter or the CAFC will en banc:

    Does anyone know any case where the inventor had both undisputed documents from every possible end user plus the PTAB stating the statutory text was met?

  10. Curious November 23, 2021 4:56 pm

    Without any serious question, the courts are trying to devise and apply a sensible standard for assessing unpatentable “abstractness.”
    That is interesting because “abstractness” is not in the statute. Rather, it was created out of whole clothe by this same judiciary that cannot seem to devise a sensible standard to apply it. Mind you, this is the same judiciary that determined an invention to an improved camera phone (Yu v. Apple) was abstract.

    Whatever the courts are doing — they aren’t doing a good job at it. Rather, they are making a mess of it.

  11. Curious November 23, 2021 5:16 pm

    but you miss the point.
    I get the point. It is the same point I recognized nearly 20 years ago back in that DC law firm (with a big brother in Chicago) in dealing with the claim construction jurisprudence being handed out. There is enough case law that the Federal Circuit can preordain the result based upon the case law they choose to follow.

    Does anyone know any case where the inventor had both undisputed documents from every possible end user plus the PTAB stating the statutory text was met?
    If by “statutory text” you mean 35 USC 101, then most cases I come across have statements on the record that they meet the statutory text. This is Step 1 of the Alice/Mayo test (see MPEP 2106.03). It is actually quite easy to meet. In fact, I cannot recall running across an application in which Step 1 wasn’t met.

  12. concerned November 24, 2021 8:59 am

    Curious: Thank you again for your insights.

    Did those applicants/patentees also have the evidence also from every possible end user?

    It is really difficult for a common person to understand they meet the law as stated and have undisputed evidence, yet there is no patent based on mystery words which the Solicitor would also not define in his response.

    I have to define my invention yet the USPTO/Solicitor do not have to define their rejections.

  13. B November 24, 2021 1:06 pm

    @ Curious “There is enough case law that the Federal Circuit can preordain the result based upon the case law they choose to follow.”

    Absolutely true – which makes argument by analogy capricious – which IS my point.

  14. concerned November 25, 2021 4:39 am

    I used to refer cases to the Attorney General regarding disputed insurance claims that my Agency felt should be paid. We never lost a case. Not because we were great, but because all the ducks were lined up. We had the insurance contract, the law, the evidence or we would not move forward. We argued merits.

    Working with “B” has taught me that a patentee/patent applicant cannot argue merits in the patent environment, the other side just does not seem to care about facts, evidence, rule of law, etc. The patentee/patent applicant has to argue the process is capricious and hope someone cares.

    I agree. If merits counted, I would not be at the CAFC, I would of had my patent years ago. I would not have the Solicitor refusing to define words he uses against me or the Solicitor arguing lower court decisions over Bilski, Mayo and Alice.

    The process is appalling. If I handled my Office like the patent environment, the Governor would have personally rang my bell. Who rings their bell?

  15. Curious November 26, 2021 1:26 pm

    Did those applicants/patentees also have the evidence also from every possible end user?
    Evidence from every possible end user? What evidence what that be? Why would the Federal Circuit care? Patent eligibility is a conclusion of law, which the Federal Circuit reviews de novo. Serious question — why is your invention more patent eligible than a camera phone (i.e., Yu v. Apple)?

    I have to define my invention yet the USPTO/Solicitor do not have to define their rejections.
    Nobody said that life was going to be fair.

    Absolutely true – which makes argument by analogy capricious – which IS my point.
    Your argument is that the system by which the Federal Circuit applies their case law is flawed. Assuming, for sake of argument, that this is true, then that would be an implicit admission that all of the other decisions rendered by the Federal Circuit were wrong decided. Do you seriously entertain any hope that the Federal Circuit would go down this path? You could be 100% entirely in the right, but the Federal Circuit is highly, highly unlikely to admit that they were wrong in all of those other decisions.

  16. Pro Say November 28, 2021 5:18 pm

    concerned: ” I would not have the Solicitor refusing to define words he uses against me or the Solicitor arguing lower court decisions over Bilski, Mayo and Alice.”

    As anyone who’s read even a handful of the Solicitor’s briefs knows, they have no problem at all defending indefensible decisions of the death squad PTAB.

    Indeed, there be no need to incur the cost of their own rubber stamp . . . when the CAFC’s is so close at hand.

    Such the money-savers they are.

  17. concerned November 28, 2021 9:50 pm

    Patent law is a conclusion of law or a conclusion of truth?
    If the law states the USPTO can state anything, true or false, then I guess I lose.

    And yes we have the evidence from every end user, that is why the USPTO runs from it, the Board wants to change the theory of the rejection and the Solicitor punts. Why does the truth scare everyone?

    This is quite an area of alleged law.

  18. concerned November 29, 2021 10:10 am

    Pro Say: Thank you for your support and comments!

    B is letting them have it over those issues and other matters.

    I thought the Solicitor was an officer of the court and certain standards are expected. There are 4 Solicitors/assistants defending the position of the USPTO.

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