Posts Tagged: "novelty"

Patent Eligibility of Diagnostic Tools: Utility as the Key to Unlocking Section 101

A petition for certiorari was filed on October 1 in the case of Athena Diagnostics v. Mayo Collaborative Services asking the question: “Whether a new and specific method of diagnosing a medical condition is patent-eligible subject matter, where the method detects a molecule never previously linked to the condition using novel man-made molecules and a series of specific chemical steps never previously performed.” The petitioners hinge their argument throughout the brief on the novel beneficial utility of their claimed method…. However, benefit has not always carried the day in recent eligibility analyses….. Patent eligibility, considered to be the most important question facing the patent system, poses insidious problems under current jurisprudence to some of the most beneficial cutting-edge technology available today. What is most curious is that this problem apparently can be solved simply by reaching back to the foundations of modern patent law and the underlying requirement that inventions be “useful,” a term that has been baked into the statutory provisions since the first patent act.

Standard Essential Patents: Statistics and Solutions to the Real Party in Interest Problem

As I noted in part one of my talk at the IPWatchdog Patent Masters Symposium, the validity statistics for SEPs do not look very good at first glance. Thus, according to a 2017 PricewaterhouseCoopers study, plaintiffs in U.S. courts (ignoring patent type) have on average a 33% chance of success—only a 27% chance in the case of telecommunications patents. This chance of success is probably overstated for Standard Essential Patents (SEPs), based on the easy availability of prior art. Indeed, according to RPX’s 2014 study, in the United States, SEPs are likely to be less than half as successful as non-SEPs.In my talk, I pointed to the high invalidation rates in Europe to buttress my point that, at first glance, SEPs seem particularly vulnerable to validity challenges. Thus, in Germany, a supposed nirvana for patent assertion, the authors of the study “Patent Paper Tigers” reviewed the case law of the German Federal Patent Court and the German Federal Court of Justice in nullity matters in the period from 2010 to 2013 and found that: The nullification rate of all Senates of the German Federal Patent Court is 79.08% in total; and the nullification rate at the German Federal Patent Court regarding Software and Telecom patents which are (currently) of particular relevance from an economic point of view is 88.11%. Returning to the point made in the first part of my talk, having noted that most SEP nullification comes from obviousness, and not novelty, there should be no public interest exception to my argument that: unprovoked—that is, without first having made a FRAND offer or counteroffer—serial nullification of SEPs is contrary to the duty to negotiate in good faith and should remove a party’s defense against an injunction to SEPs.

Now, there is a flaw in this theory, and that is that, in the past few years, third parties have emerged that will—for their members or other contracted entities—kill patents.

Understanding the Difference Between Preemption and Novelty/Nonobviousness

Recently, the United States Court of Appeals for the Federal Circuit (“the Federal Circuit”) issued its opinion in Solutran, Inc. v. Elavon, Inc., 2019-1345, 2019-1460 (Fed. Cir., July 30, 2019) in which the Court held claims 1-5 of Solutran’s U.S. Patent No. 8,311,945 invalid under 35 U.S.C. § 101 for failing to recite patent eligible subject matter. In reversing the District Court, the Federal Circuit found that the claims of the patent recited an abstract idea (electronically processing paper checks) and that the claims failed to transform that abstract idea into patent-eligible subject matter. More importantly, the Federal Circuit dismissed Solutran’s argument that the claims were patent eligible simply because they were novel and non-obvious, noting that: “We have previously explained that merely reciting an abstract idea by itself in a claim—even if the idea is novel and non-obvious—is not enough to save it from ineligibility.” The Solutran decision is not the first time the Federal Circuit has held that novelty/non-obviousness does not bear on the question of patent eligibility.

Crocs loses inter partes reexam, will appeal rejection of design patent for ornamental footwear

Boulder, CO-based shoe manufacturer Crocs, Inc. (NASDAQ:CROX) had a design patent rejected by the U.S. Patent and Trademark Office. The patent struck by the USPTO is U.S. Patent No. D517789. Issued in March 2006 and assigned to Crocs, it protected the ornamental design of footwear. The design patent illustrations attached to the ‘789 design patent showcase the well-known Crocs design featuring holes in the footwear material around the front of the foot and a strap behind to hold the footwear in place against a person’s heel… The Examiner refused to recognize a priority claims of earlier filed applications dating back to June 23, 2003. According to the Examiner, the shoe that is the subject of the ‘789 design patent was not adequately disclosed prior to May 28, 2004, making an earlier priority date claim impossible to recognize.

The Problem of Reducing Patentability to Novelty

Ironically, judicial decisions on patent eligibility tend to depend on inventiveness, with tests of originality that tend to refer to novelty, reducing the issue of patentability to novelty. For example, post-Alice Federal Circuit decisions in Enfish and Bascom flush out the two-step tests of a technical contribution and an inventive step, thereby reducing patentability to inventiveness. Uncertainty about patent validity, the changing standards for assessing patent validity or the false equivalence between patentability and novelty, has tended to destabilize the patent system.