Posts Tagged: "SCOTUS"

A well-known patent monetization firm jumps back into the brokered patent market in 2016’s fourth quarter. A federal judge in New York allows arguments over whether American movie star Marilyn Monroe has become too generic for any trademark rights to continue. Sony files a patent infringement lawsuit over set-top boxes. Forever 21 files a declaratory judgment action calling Adidas a trademark bully. Cher wins a copyright dismissal over claims her 2013 album cover was infringing. The Supreme Court gears up to hear oral arguments in a case that examines the limits of the patent exhaustion doctrine. Plus a very busy week on Capitol Hill.

The facts of the underlying case were incredibly simplistic and not representative of a typical patent infringement case involving complex technologies. The parties agreed that the exported product consisted of one of five total “components of the patented invention,” so the Court did not address “how identify the ‘components’ of a patent or whether and how that inquiry relates to the elements of a patent claim.” Id. at FN2. Addressing the issue in a case with minimal real-world applicability does little to help the finder of fact determine whether a product contains one or multiple components of a patented invention. The decision in Promega does not relieve manufacturers from the risk that their single-part product could be used inadvertently to infringe a U.S. Patent overseas. When disputes arise under § 271(f), defendants will need to build strong evidence showing that their product only contains one component to avoid infringement, while plaintiffs will be crafting arguments that the total number of patented components is low and the exported product contains multiple components.

If the Supreme Court were to reverse the Federal Circuit and revert back to Fourco Glass, that would make it difficult for patent owners, including Whirlpool and others like them, to reasonably seek redress for patent infringement. Essentially, a reversion back to Fourco Glass would mean that patent infringement cases brought by corporations like Whirlpool would have to literally be brought in the home court of the patent infringer, or perhaps in Delaware where so many entities are incorporated. It would also necessitate a multiplicity of lawsuits, as Whirlpool explained in its amicus filing.

The resulting decisions reveal the Supreme Court’s holistic outlook as a generalist court concerned with broad legal consistency rather than fidelity to patent law’s underlying specialized and unique features moored in technology research, invention, and patenting processes. Unfortunately, as shown below, the adverse effects on patent rights due to the deviant patent doctrines arising out of the Court’s decisions far exceed the benefits of assimilation and conformity of the patent law with the general law… The dearth in understanding technologies and related invention processes and the lack of prior expertise in patent law pertains to Justices across the political spectrum. Patent law raises questions that have the potential to divide conservatives and liberals alike, as it pits principles of liberty and property against one another. For example, the pillars of the recent problematic jurisprudence on patent-eligibility were authored by liberal Justice Breyer (Mayo v. Prometheus) and by conservative Justice Thomas (Alice v CLS Bank).

In yet another reversal of the Federal Circuit, the Supreme Court yesterday held that liability under § 271(f)(1) of the Patent Act requires more than one component part of a multicomponent patented invention to be shipped abroad for assembly, no matter how important or critical that one component may be. Life Techs. Corp. v. Promega Corp.,(U.S. Feb. 22, 2017) 580 U.S. ___, slip opinion at *8 (No. 14-1538)… Writing for the Court, Justice Sotomayor rejected the case-specific approach of the Federal Circuit. The Supreme Court analyzed the ambiguous term “substantial” in the full context of the statute. Based on this context approach, the Court reasoned that “substantial” is best understood in a purely quantitative sense, as opposed to the qualitative importance of the component approach championed by Promega.

The first and perhaps most obvious news story here relates to the fact that the United States Supreme Court believes that Michelle Lee remains Director of the USPTO… This dispute is between the parties to an inter partes review (IPR) proceeding conducted by the Patent Trial and Appeal Board (PTAB). There are three questions presented by Oil States in the petition for writ of certiorari… Despite these very important questions, the Federal circuit affirmed the Patent Trial and Appeal Board (PTAB) without opinion with a Rule 36 judgment, which is simply a one-word judgment that says “Affirmed” without any explanation.

With respect to the thorny issue of patent litigation, Senator Hatch explained that there is a very real chance that venue reform will happen this year… HATCH: “The Supreme Court is currently examining the issue, so we won’t have a full view of the landscape until after the Court rules. But no matter what the Court does, we’re likely going to need follow-on legislation to prevent future forum-shopping and to ensure that litigants have a meaningful connection to the site of the suit.”

I am particularly concerned about the impact this case law has on the patent application process. Instead of focusing on novelty and clarity, examiners and applicants alike spend time struggling to make sense of Section 101 jurisprudence. That is a serious misallocation of the limited resources of both patent examiners and applicants, leading to longer examination times and less reliable patent grants. Delays in patent review and patent grants can interrupt a startup’s lifecycle, negatively influencing employment growth, sales, and subsequent innovation. This is just one of several factors lengthening patent examination, but it is one that may warrant a congressional response.

Earlier this evening President Donald Trump announced the nomination of Judge Neil Gorsuch of the Court of Appeals for the 10th Circuit as his selection to replace Justice Antonin Scalia, who passed away February 13, 2016. While there will be much time to evaluate Judge Gorsuch’s record and impressive Ivy League background prior to any confirmation hearing or vote in the United States Senate, I have located several intellectual property cases from the 10th Circuit with decisions authored by Gorsuch. While patent issues would not have gone to the 10th Circuit, it also seems worth pointing out that Judge Gorsuch has expressed skepticism of Chevron deference.

IPO supports legislation because the patent eligibility test created by the U.S. Supreme Court is difficult to apply and has yielded unpredictable results for patent owners in the courts and at the USPTO. IPO’s proposed legislative language would address these concerns by reversing the Supreme Court decisions and restoring the scope of subject matter eligibility to that intended by Congress in passing the Patent Act of 1952; defining the scope of subject matter eligibility more clearly and in a technology-neutral manner; requiring evaluation of subject matter eligibility for the invention as a whole; and simplifying the subject matter eligibility analysis for the USPTO, courts, patent applicants, patentees, practitioners, and the public by preventing any consideration of “inventive concept” and patentability requirements under sections 102, 103, and 112 in the eligibility analysis.

The American patent system represents a delicate balance. On the one hand, the patent system provides an incentive to invest in risky technical problem solving by giving an inventor an “exclusive right” for a limited time. On the other hand, from the time of the first Patent Act in 1790, patent critics have argued that patents block competition with a temporary monopoly. This tension has, nevertheless, enabled the rise of the U.S. as a major industrial economy, particularly after the Civil War. Optimally, the patent system encourages inventors to take risks to invent and disclose new and useful things by investing in ex ante costs before a later payoff. After a limited time of exclusivity rights, a patented invention falls into the public sphere, thereby providing a public interest in the long run. Economic and technological progress proceeds by building on previous inventions. Until about 2006, the U.S. patent system worked well, as evident in the development of the largest and strongest economy in the world.

On the menu this week for Other Barks & Bites, the Supreme Court hears oral arguments in a case challenging the Lanham Act’s disparagement provision, a six-figure damages verdict goes in favor of former USPTO Deputy Director Russell Slifer, a TTAB petition is filed to challenge the trademark application for an NFL franchise currently in the relocation process, an announcement by a Japanese academic-industry research project that claims to have doubled the effectiveness of solar cell panel conversion rates, the FTC takes action against a pharmaceutical company and much more.

As we approach the fifth anniversary of the Supreme Court’s decision this is what I know — Mayo is a lawless decision by a Court that has become too powerful. Mayo continues to wreak havoc on the patent system and innovators, and has resulted in patent protection being easier to obtain for cutting edge software, biotech, genetic and medical innovations in Europe, Canada, Australia and even China. Mayo is at the root of all of the problems facing the industry relative to patent eligibility, and if I could repeal only one Supreme Court decision in the patent space it would be Mayo. Indeed, the Supreme Court’s decision in Mayo is probably the worst, most wrongly decided case by the Supreme Court in the patent field ever. I say “probably” only because there are so many contenders to choose from that picking only one is truly difficult. Only the Supreme Court’s decision in eBay v. MercExchange comes at all close to Mayo in terms of damage to the patent system. Only the Supreme Court’s decision in Association of Molecular Pathology v. Myriad Genetics comes close to Mayo in terms of intellectual dishonesty.

This week’s news headlines include nomination hearings for the potential incoming U.S. Commerce Secretary, the Supreme Court’s granting certiorari for an important case in biologics, a patent infringement suit targeting the NFL, the expiration of copyright protecting the works of a very influential science fiction author from the early 20th century, and another sports figure — this time UFC Lightweight Champion Conor McGregor — filing trademark applications.

The Supreme Court has scheduled oral argument in Lee v. Tam for January 18… The genesis of the case is a Portland, Oregon all-Asian-American band called The Slants, founded by petitioner Simon Shiao Tam. An application for trademark was made and the USPTO said “NO” on the basis that “The Slants” is a highly disparaging term and therefore must be denied registration under Section 2(a) of the Lanham Act… The cultural and societal value of the free flow of speech trumps government regulation. The Supreme Court should uphold the Constitution and confirm the importance of robust political debate, cultural discourse, and the right to use ANY words as part of a personal identity.