Posts Tagged: "Judge Kathleen O’Malley"

The only thing we know is this — the Federal Circuit issued an extraordinarily brief per curiam decision, which stated: “Upon consideration en banc, a majority of the court affirms the district court’s holding that the asserted method and computer-readable media claims are not directed to eligible subject matter under 35 U.S.C. § 101. An equally divided court affirms the district court’s holding that the asserted system claims are not directed to eligible subject matter under that statute.” Thus, the asserted claims are not patent eligible.

In partially dissenting, Judge Newman’s beef with per curiam panel opinion on the small entity status issue was in “declin[ing] to correct the district court’s ruling that improper payment of the small entity fee is material to patentability.” Newman’s view that filing of an incorrect small entity statement doesn’t render it per se “material” is based on the 1928 Supreme Court case of Corona Cord Tire Co. v. Dovan Chemical Corp. which Newman said had made immaterial to patentability “an affidavit that was not the basis of the patent grant.” Put differently, Newman characterized Therasense as reiterating that the doctrine of inequitable conduct “should only be applied in instances where the patentee’s misconduct resulted in the unfair benefit of receiving an unwarranted claim.” In other words, Newman viewed a potentially incorrect assertion of small entity status as being “immaterial to the patent’s issuance.” But she found the per curiam panel’s opinion as being equivocal “on materiality and intent based on error in small entity status” and thus “simply add[ing] uncertainty when such is unwarranted.

The decision of the Supreme Court in Prometheus has been predicted to have implications for business method patentability, but the decision in what will surely become known as the Alice case provides an early indication that the CAFC may endeavour to limit its scope. Whether the claimed subject matter lies in the reality of patent-eligible subject-matter or is more correctly located in the Wonderland of abstract ideas is an issue that has been debated on both sides of the Pond, and on which the Dodo or the King of Hearts in his judicial capacity would surely have had an opinion if it had been brought to their attention. In the US there appears to be ample scope for further debate.

In what seems to be a continuing trend, the United Stats Court of Appeals for the Federal Circuit is continuing to show increasingly little tolerance for abusive patent litigation tactics. In the most recent pronouncement along these lines the Federal Circuit, per Judge O’Malley (with Judges Newman and Prost joining), ruled the district court appropriately awarded the defendant $3,873,865.01 in attorney fees and expenses under § 285, as well as $809,788.02 in expert fees.

The CAFC’s split panel decision this past week – In re Construction Equipment Company – extends the PTO’s authority to reexamine a patent even where its validity has already been adjudicated and confirmed by the courts. Yet the CAFC once again fails to explain how a PTO reexamination finding that a patent is invalid effects an earlier judicial determination that the same patent is valid and infringed.

I have wondered out loud whether the Judges of the Federal Circuit realize that the outcome is unpredictable until the panel has been announced. It seems that at least some do. How is that defensible? How do others not on the Court not see a problem? The law needs to be certain and predictable and at the Federal Circuit far too many times it is neither. Claims construction is but one of the areas as clear as mud. The Federal Circuit was created to bring certainty to the law, but what has transpired over the course of the last 10 years or so seems to be anything but certainty and stability. For crying out loud a patent is a property right and for any property rights regime to flourish it must be stable and certain! In the words of this generation: OMG!

Some will undoubtedly view the Chief Judge’s basis in Ultramercial for distinguishing the ruling in CyberSource as being “slight of hand” and using “mirrors,” but it certainly illustrates the wide gulf of views between the various members on the Federal Circuit on the patent-eligibility question. I wouldn’t be surprised (and frankly it needs to happen) if both Ultramercial and CyberSource ended up before the en banc Federal Circuit. As I’ve noted previously, we’ve currently got what appear to be irreconcilable decisions in the Classen, Prometheus, and AMP cases in determining the patent-eligibility of certain medical (e.g., diagnostic) methods. With what appears to be similarly conflicting decisions in Ultramercial and CyberSource, the gauntlet has truly been thrown down. An en banc Federal Circuit needs to step in soon, or the conflagration that currently exists in the patent-eligibility “war” might soon consume us all.

It was also determined that the underlying patent litigation was brought for no other reason than to extract nuisance payments despite the fact that there was no infringement. Specifically, the district court determined that Eon-Net filed the lawsuit against Flagstar had “indicia of extortion” because it was part of Eon-Net’s history of filing nearly identical patent infringement complaints against a plethora of diverse defendants, where Eon-Net followed each filing with a demand for a quick settlement at a price far lower than the cost to defend the litigation.

Judge Kathleen O’Malley was confirmed by the United States Senate earlier today. O’Malley’s confirmation, along with the confirmation of 18 others in recent days, is the result of a deal between Senate Democrats and Republicans that ensured passage of 19 nominations in exchange for an agreement not to move forward with other controversial nominations, including the hotly challenged nomination of Goodwin Lui, who is Associate Dean and Professor of Law at University of California Berkeley School of Law.