Posts Tagged: "innovation"

There really is no one-size-fits-all approach entrepreneurs and business executives can follow, and there is no roadmap to success that will work in all cases. That doesn’t mean there aren’t a number of things that can and should be understood, appreciated, and truly internalized if you are going to pursue any kind of economic engagement as more than a hobby, or to do more than merely punch a clock for a paycheck every other week. This is not to say that there isn’t anything wrong with making a few extra dollars as the result of a hobby, or being happy where you are, doing your job and then punching out at 5 o’clock. But if you want more, if you have hopes and dreams of building something from the ground up that is your own and will become your business, or climbing the corporate ladder to become a C-suite executive, you need to treat each business endeavor with an entrepreneurial mindset from the earliest stages. If you don’t, it will create all the wrong habits, and worse, it will create the wrong mindset. A mindset is a very difficult thing to change, and patterns become easy, comfortable and difficult to break.

The National Institute of Standards and Technology recently indicated in its “Return on Investment Initiative draft green paper” that it would issue regulations effectively ending attempts to misuse march-in rights to assert government price controls over successfully commercialized federally-funded inventions. Such an announcement was bound to elicit a reaction. That it came in The Washington Post shouldn’t be a surprise. The paper’s April 18 article, “A rare deterrent to limitless drug price increases may die under Trump” gives coverage to both sides, but the takeaway is that something nefarious is underway: “As drug prices have soared, lawmakers and patient advocates have pushed the federal government to deploy for the first time a powerful deterrent: a legal provision that allows it to suspend a drugmaker’s patent and license someone else to produce the drug. Now, responding to industry alarm over those demands, the Trump administration is proposing to strictly limit the little-known power,” said the article. There’s a reason why this “little-known power” has never been used—it doesn’t exist.

Capitol Hill remains quiet this week as both the U.S. House of Representatives and Senate enter a second straight week of work periods. Technology and innovation events continue, however, at the many policy think tanks residing in Washington, D.C. Monday starts with a discussion on U.S.-China relations at the Brookings Institution, while a pair of events at the Cato Institute look at whether human ingenuity can improve resource availability in the face of a growing world population and the effects of artificial intelligence (AI) on the future of work. In the middle of the week, the Center for Strategic and International Studies hosts two events exploring threats to the government’s software supply chain, as well as counterspace threats faced by the U.S. The week wraps up on Friday with a Consortium for Science, Policy and Outcomes event that explores the positive effect that creative play can have on business innovation.

The year 2017 proved to be a difficult one for the territory of Puerto Rico. Even before Hurricane Maria hit in September of that year, the island was in trouble. By the end of year, the economy was predicted to shrink back to levels not seen since 2000, the average household income was a mere $19,350, one-half that of Mississippi, the poorest state in the nation. Meanwhile, the cost of living in San Juan, Puerto Rico’s capital, was 11.6% higher than in an average U.S. metropolitan area. The government was already dealing with $74 billion in bond debt and another $49 billion in unfunded pension obligations, with U.S. banks taking at least $1 billion to manage its bond sales. In the fall of 2017, after Maria hit head on as a Category 4 hurricane that caused catastrophic damage, the second blow to Puerto Rico was brewing—this time in Washington. The Republicans, being in control of the House, Senate, and the White House, drafted a tax reform bill that proposed the biggest change to the tax code in 30 years. Within that tax bill was a provision that was predicted to decimate what is left of Puerto Rico’s remaining economy. The tax bill proposed, and ultimately the President signed into law, a provision that levies a 12.5% tax on profits derived from foreign-owned intellectual property. This hits Puerto Rico in two ways. First, Puerto Rico has a complicated taxation relationship with the United States. Its citizens do not pay federal income taxes, although they do pay into Social Security. However, when it comes to taxation, the IRS considers Puerto Rico to be a foreign country. Thus, any profits derived from intellectual property in Puerto Rico would be considered foreign profits subject to the excise tax. The second problem is that Puerto Rico derives a great deal of its revenue from the manufacturing of prescription drugs, representing the very profits from intellectual property contemplated in the law. According to the U.S. Bureau of Labor Statistics, pharmaceuticals account for 72% of Puerto Rico’s 2017 exports, which was valued at $11.5 billion.

On April 10, inventor Gilbert Hyatt and the American Association for Equitable Treatment (AAET) filed a petition for writ of certiorari with the U.S. Supreme Court asking the Court to review a Federal Circuit case that struck down an Administrative Procedures Act (APA) claim brought by the petitioners. If the Supreme Court grants certiorari, they will determine whether a section of the U.S. Patent and Trademark Office’s (USPTO) Manual of Patent Examining Procedure (MPEP) authorizing examiners to reopen patent prosecution and block a patent applicant’s appeal after a second rejection violates that patent applicant’s statutory right of appeal under the Patent Act. The particular section of patent examination procedure at issue in this appeal is MPEP § 1207.04, titled Reopening of Prosecution After Appeal. This section was adopted by the USPTO in August 2005. Prior to this, patent examiners could propose reopening prosecution to patent applicants who had appealed a decision after a second rejection and patent applicants were free to disregard this proposal. In Gil Hyatt’s case, Section 1207.04 was used by patent examiners to force the reopening of prosecution, ending 80 appeals of examiner decisions to the Patent Trial and Appeal Board (PTAB).

You’re a patent prosecutor. You’ve just received an office action. The examiner has rejected your claims. You think the examiner got it wrong. On the technical issues, it looks like the examiner is off base, pointing out elements in the prior art that aren’t really there, and finding motivation based upon the flimsiest bases. Also troubling is that the examiner has based some of the rejections upon rules or precedent that you think are incorrect, both on their face and as applied to your claims. So, it’s time to prepare an office action response. Hopefully this will change the examiner’s mind and will allow your client to receive a patent. Your response may include some preliminary matters, perhaps some claim amendments and recitation of the prosecution history, and the status of various claims. Then you come to the arguments. You want to argue with the examiner’s decisions, to be sure, but that does not mean that you want to be disagreeable. Your job as an advocate is to help the examiner understand your client’s position. There are numerous techniques you can apply in order to argue your case in a more effective manner. Effective advocacy is not limited to legal documents filed in court or an administrative appeal. Even when you are arguing to an examiner, your arguments can be made more effective by the manner in which those arguments are presented.

Yesterday, members of congress announced in a press release a proposed framework to fix patent eligibility law in the United States.Reactions to the framework were mixed. While many are delighted that the issue seems to be getting real attention on Capitol Hill, others are skeptical of some of the proposals. For example, Russ Slifer, former Deputy Director of the United States Patent and Trademark Office (USPTO), described the framework as “a big swing and a miss.” Having attended the meeting on the Hill yesterday in which the framework was released and discussed prior to being circulated to the public, Todd Dickinson of Polsinelli, and the former USPTO Director, said that he can understand how those seeing the proposal without having taken part in the dialogue might be alarmed. “There are still some big questions to answer, but I left the meeting encouraged by the momentum,” Dickinson told IPWatchdog. The discussion, which he described as decidedly “more lawyerly” than previous meetings on the topic, included staffers for both the House and Senate, and from both political parties, which “is a good sign that there is a continued intention to do something,” he said.

In a promising indication that there is real momentum on The Hill to fix Section 101 law, several Senators and Representatives today proposed a framework for addressing 101-related patent reform.Senators Thom Tillis (R-NC) and Chris Coons (D-DE)—respectively, Chair and Ranking Member of the Senate Judiciary Subcommittee on Intellectual Property—and Representatives Doug Collins (R-GA-9), Ranking Member of the House Judiciary Committee; Hank Johnson (D-GA-4), Chair of the House Judiciary Committee’s Subcommittee on Courts, Intellectual Property and the Internet; and Steve Stivers (R-OH-15) announced earlier today indicating that “months of hard work by the Senators and Representatives has led to this bipartisan, bicameral framework.” IPWatchdog has been reporting for some time that closed-door meetings have been held with stakeholders and members of congress to gather information on the problems with patent eligibility law. IPWatchdog also has been told that the relevant members of congress intend to hold regular public hearings on the topic beginning soon. “I think it’s wise for congress to hit the reset button and reassert its authority with respect to the statutory requirements, and getting rid of the non-statutory judicial exceptions is an absolute must,” said Gene Quinn, patent attorney and President and CEO of IPWatchdog, Inc. “I just hope that whatever the ultimate statutory language is, it is very carefully limited and narrowly tailored; and I must confess that it worries me a little that the framework says that reciting generic language won’t be enough to save an otherwise ineligible claim.”

Among the seven amicus curiae briefs filed Monday with the U.S. Supreme Court in InvestPic, LLC, v. SAP America, Inc., Eagle Forum Education & Legal Defense Fund’s brief argues that the case demands a hearing because the Federal Circuit has added yet another extra-statutory test to the already distorted patentability jurisprudence. In a decision of May 15, 2018 authored by Judge Taranto, the Federal Circuit found the patent claims of U.S. Patent No. 6,349,291 invalid because they were directed to an abstract idea and lacked an inventive concept necessary to save the invention under 35 U.S.C. § 101. In the course of its opinion, the Federal Circuit created a “physical realm” test, which is nowhere to be found in 35 U.S. Code Section 101, having been wholly conjured by judges.

In one more example of ways the U.S. patent system can be stacked against the small inventor, we have the story of Lori Cheek, who more than ten years ago had an idea for a unique dating service that she dubbed Cheekd. In 2008, still just prior to the age when people existed via smartphone, the patent she applied for covered a card-based dating system. Cheek decided to leave her steady job as an architect to pursue the idea of a business centered around pre-printed dating cards featuring clever pick-up lines and held a brainstorming session with friends on February 22, 2008. On March 7, 2008, she registered the URL Youvebeencheekd.com (now cheekd.com) with GoDaddy, and officially founded her company, Cheekd, on April 20, 2009. She applied for a patent in 2010 and it was granted on September 24, 2013. A few years later was when the trouble started for Cheek, and today, she is embroiled in her second lawsuit over a patent on a business she is no longer pursuing, both brought by a man, Alfred Pirri, whose first suit was dismissed in pre-trial conference.

On April 8, the Court of Appeals for the Federal Circuit issued a precedential decision in Omega Patents, LLC v. CalAmp Corp. that reversed and vacated a district court’s ruling that CalAmp had directly infringed certain patent claims asserted by Omega. While the Federal Circuit did affirm that CalAmp directly infringed one of the asserted claims, it vacated and remanded on a number of the district court’s other findings. The decision was issued by a panel including Chief Judge Sharon Prost and Circuit Judges Timothy Dyk and Evan Wallach. Omega’s allegations of patent infringement centered on CalAmp’s sale of Location Messaging Unit (LMU) products that assist businesses and government entities by tracking fleets of vehicles and retrieving vehicle information such as battery health and speed for remote monitoring. A jury verdict in the Middle District of Florida held that all asserted claims were not invalid, were infringed, and that CalAmp had committed willful patent infringement. The jury awarded compensatory damages of $2.98 million and the judge trebled that damages award and added attorney’s fees, damages for sales subsequent to the jury verdict and pre-judgment interest, increasing the monetary award to about $15 million with an ongoing royalty rate of $12.76 per sale of infringing unit by CalAmp.

This week on Capitol Hill, both the U.S. House of Representatives and the U.S. Senate are quiet for the next two weeks as the House enters district work periods and the Senate holds state work periods. However, various policy institutes around the nation’s capital continue to host events related to technology and innovation, and the Supreme Court will hear oral arguments in Andrei Iancu, Under Secretary of Commerce for Intellectual Property and Director, Patent and Trademark Offce v. Erik Brunetti. The week kicks off early on Monday with an all-day event at the Internet Society looking at the prospects of federal legislation to improve consumer data privacy from various angles and the Brunetti oral argument. The Cato Institute will host events related to government regulation of social media, as well as the section of U.S. Internet law which largely eliminates legal liability for online service providers based on user-generated content. The week wraps up with an event at the Center for Strategic and International Studies, which will look at U.S.-Australia cooperation in the digital economy, among other sectors. 

An important part of any patent portfolio manager’s work is to understand which patents are likely to be implemented in real-world technology. We can think of the process of matching patents to products as having three levels of progressively precise analysis. The investment in time and resources required to arrive at useful documentation at each level increases as the level of analysis increases.  Accordingly, access to higher levels of product matching analysis will tend to enable higher monetary returns if the associated documentation can be brought to bear effectively in the intellectual property marketplace. To begin with a bit of background, there is a strong correlation between the value of a patent and the likelihood that the technology it describes is instantiated in real-world commercial products. Any methodologies that can provide insight into this likelihood therefore provide information on the value of a patent.

In each of the recent Federal Circuit decisions on medical diagnostics inventions, Athena Diagnostics v. Mayo Collaborative Services, 2017-2508, (Fed. Cir. Feb. 6, 2019) (“Athena”) and Cleveland Clinic Found. v. True Health Diagnostics LLC, 2018-1218 (Fed. Cir. April 1, 2019; non-precedential) (“Cleveland Clinic II”), the court affirmed a district court ruling that found a medical diagnostic or a related patent invalid for being directed to ineligible subject matter. Athena and Cleveland Clinic II follow the hard stance taken by the Federal Circuit against medical diagnostics inventions, first in Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F.3d 1371, 1376 (Fed. Cir. 2015) (“Ariosa”) and next in Cleveland Clinic Found. v. True Health Diagnostics LLC, 859 F.3d 1352, 1361 (Fed. Cir. 2017) (“Cleveland Clinic I”). In Athena, the patent covered a method for diagnosing a disease in a subpopulation of affected individuals based on the discovery of a correlation between the disease and certain autoantibodies found only in that subpopulation. In Cleveland Clinic I, the patent claims were directed to diagnosing the risk of atherosclerotic cardiovascular disease (CVD) based on the correlation between elevated levels of a protein found in the blood and occurrence of atherosclerotic CVD. In Cleveland Clinic II, the claims were directed to methods of identifying elevated levels of the protein but did not include any recitation of the correlation…. The requirement for an improvement to the technology involved in carrying out the claimed method is a steep hurdle for the eligibility of most medical diagnosis inventions, since the essence of such inventions is applying a newly discovered correlation to deliver a practical benefit—not improving the technology used to provide the diagnosis. In this regard, medical diagnostic inventions are unique. This point was highlighted by the Athena dissent through reference to the amici curiae Five Life Sciences Patent Practitioners’ brief, which stated, “[medical] diagnostic methods . . . are so tightly bound to underlying natural laws and phenomen[a], they are especially susceptible to undue expansion of the eligibility standards…” Athena Dissenting opinion at 13.

A company must be strategic in any business decision it makes in order to ensure that it takes the necessary measures to avoid liability for its actions. With respect to patent infringement, and specifically willful patent infringement, the different approaches to determining which measures to take and when to take such measures have been repeatedly challenged in light of a number of court decisions in recent years. To set the scene, the Federal Circuit held in Underwater Devices Inc. v. Morrison-Knudsen Co., 717 F.2d 1380 (1983) that a potential infringer has an affirmative duty to exercise due care to determine whether or not he or she is infringing. This placed the burden on the potential infringer to seek competent counsel and obtain either a non-infringement opinion or invalidity opinion prior to undertaking the possible infringing activities. This would prevent a finding of willful infringement and treble damages.