Patent Law Blog (Patently-O)

BPAI: “Programmed Computer Method” Not Patentable Subject Matter

Ex parte Halligan (BPAI 2008)

Halligan's patent application claims a "programmed computer method" that operates to identify trade secret information. (Claim 119). In essence, the computer program has the common law rules of trade secrets hardcoded, and those rules are applied to determine whether particular information is a "trade secret." Applying the machine-or-transformation test of Bilski, the Board of Patent Appeals and Interferences (BPAI) rejected Halligan's claims as lacking patentable subject matter under 35 USC § 101.

Under Bilski, "[a] claimed process is surely patent-eligible under § 101 if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing." To avoid preemption the Federal Circuit emphasized that "the use of a specific machine or transformation of an article must impose meaningful limits on the claim's scope to impart patent-eligibility;" that "the involvement of the machine or transformation in the claimed process must not merely be insignificant extra-solution activity;" and that the transformation "must be central to the purpose of the claimed process."

Transformation: As in Bilski, the transformation here involves legal rights and "does not represent physical and tangible objects." Therefore, it fails the transformation prong of the test.

Machine: Claim 119's only tie to a machine is the preamble statement that the method is a "programmed computer method." The BPAI listed several reasons why that recitation is insufficient to satisfy the machine prong of Bilski:

"This recitation fails to impose any meaningful limits on the claim's scope as it adds nothing more than a general purpose computer that has been programmed in an unspecified manner to implement the functional steps recited in the claims. Were the recitation of a "programmed computer" in combination with purely functional recitations of method steps, where the functions are implemented using an unspecified algorithm, sufficient to transform otherwise unpatentable method steps into a patent eligible process, this would exalt form over substance and would allow pre-emption of the fundamental principle present in the non-machine implemented method by the addition of the mere recitation of a "programmed computer." Such a field-of-use limitation is insufficient to render an otherwise ineligible process claim patent eligible."

Means-Plus-Function language: A second set of claims were directed to the "programmed computer." Functional elements of the software were described as "means for ___." The structure of a means plus function element is presumably particular enough to constitute a "particular machine." However, the BPAI expressly did not reach that issue – rather, the Board rejected those claims under 35 USC § 112 as indefinite for lacking any description of particular structure in the specification. Following Aristocrat, the opinion noted that software-type means should include a disclosure of an algorithm. "The Appellant has failed to disclose any algorithm, and thus has failed to adequately describe sufficient structure, for performing the recited functions of claims 1 and 121 so as to render the claims definite."

Notes:

• Read the decision
• Open Government: Not yet. The BPAI opinions are stored on the site http://des.uspto.gov. Unfortunately that site is not crawled by web indexes such as Google or Yahoo. The problem is that the site includes a "robots.txt" file that excludes such activity. See http://des.uspto.gov/robots.txt. Robots are also blocked from crawling the USPTO patent database (http://patft.uspto.gov/robots.txt) and the PAIR site (http://portal.uspto.gov/robots.txt). Also blocked from crawling is this site: http://www.uspto.gov/web/gifs/ - what is that?
• The inventor Mark Halligan is a Trade Secret expert and partner at Lovells and adjunct professor (teaching trade secret law) at John Marshall Law School in Chicago.

   

Patently-O Bits and Bytes

• Poor Economic Forecast and Patent Prosecution:
  • Bad: Patent value is based on potential market for patented products when the market shrinks, so does the value of the patents;
  • Bad: Patent prosecution is generally a cash-heavy endeavor, and many firms are low on cash/credit;
  • Bad: The smaller market and lack of cash may also depress research & development expenditures – potentially leading to a time-lagged depression in patent applications.
  • Good: When times are tough, folks save their scraps. Patents are one way to do that;
  • Good: Patents are something that can be more easily sold or licensed (as compared with trade secrets, for instance). Companies looking for alternative cash streams; to sell-off portions of the corporation; or to retain some value in bankruptcy may look to patent protection.
• I spent a summer at Heller Ehrman while in law school. The firm dissolved earlier this fall. Using Patent Buddy, I graphed the number of registered patent practitioners at Heller over the past several years. Their patent department shows problems stretching back to 2007.

• Figure 2 below shows the same information for the law firm of Akin Gump. Patent Buddy's data comes directly from the PTO's enrollment database. That database is usually a bit outdated because many patent attorneys are slow to update their records.

• Obama's Choice as the next head of the Department of Commerce is New Mexico Governor Bill Richardson. Gov. Richardson was Energy Secretary under Clinton.
• New Blogs (new to me):
  • http://www.tangible-ip.com/
  • http://greatdomainname.wordpress.com/
  • http://ipfinance.blogspot.com/
  • http://coderights.com/
  • http://boswellip.com/blog
• Some places are hiring patent attorneys: Apple; Ultradent; Quine IP Firm; Invention Law Group (IV); MoFo; Roche; Wenderoth; Connolly Bove; Gordon Reese; GWU; Ward & Smith Firm; Myers Dawes; Young & Thompson; Pacific Biosciences; Amin Hallihan.

   

  

Federal Circuit Internal Operating Procedure

The Court of Appeals for the Federal Circuit generally follows its own set of "internal operating procedures." Although these are not citable rules, they do represent the usual standard practice for the court. The court provides them to the public to try to steer appellate practice away from a purely old boy system and allow the public to understand the court's process. Transparency is especially important for the Federal Circuit. Although located in Washington DC, the court's jurisdiction reaches across the nation. And, lawyers from across the country come to DC to argue on behalf of their clients. The Federal Circuit – especially Judge Michel – should be commended for its work toward a more open system that is more transparent than ever. The court has done an excellent job with its online public release of new opinions that provides equal access to new information. That system is especially important when a case involves a major product (such as a blockbuster pharmaceutical) of a publicly traded company. The audio files have also been useful for non-Washington insiders to understand the impact of particular oral arguments. The court is working on the next step –immediate online access to briefs and other pleadings.

Back to the new procedures: Anyone planning to practice before the court should read the internal operating procedures. In a recent update, the court provided two additional bits of information about its operation. The first statement describes the process of selecting three judge panels. According to the court, the three-judge panels are randomly selected, subject to the availability of each judge.

"The chief judge provides to the clerk's office a list of judges that are available for each day of an argument session. The clerk's office runs a computer program that randomly generates three-judge panels for each month, subject to the judges' availability."

The second new discussion in the IOP explains how pre-release precedential opinions are circulated to all Federal Circuit judges and the "senior technical assistant" prior to publication. Non-panel members have seven working days to provide comments or request that publication be held pending en banc poll.

"When all panel votes are in on a precedential opinion or order, the authoring judge circulates the opinion and any concurring or dissenting opinions, with a transmittal sheet, to each judge. A copy is also circulated to the senior technical assistant (STA), and the STA shall provide information on potential conflicts between the panel-approved opinion and any other prior opinions of the court or other relevant precedents. The nonpanel members of the court will have seven working days (twelve working days for opinions circulated during the summer period) to review a circulated precedential opinion or order. Nonpanel members may send comments to the authoring judge, to the panel, or to all judges. A nonpanel member judge in regular active service may submit a hold sheet pending a request for an en banc poll. Absent transmittal of a hold sheet or a request for an en banc poll during the circulation period, the authoring judge sends the opinion, and any concurring or dissenting opinions, to the ASO for copying and delivery to the clerk for issuance."

Notes:

• Revised IOP [PDF file]
• Mark Davies Book on Federal Circuit Appellate Procedure:

Leader Tech v. Facebook (D.D.E. 2008)

On November 19, Leader Tech sued Facebook for patent infringement of its U.S. Patent No. 7,139,761. The '761 patent claims priority to a provisional application filed in December 2002 – well before Facebook's 2004 launch. The patent claims are difficult for me to understand:

1. A computer-implemented network-based system that facilitates management of data, comprising: a computer-implemented context component of the network-based system for capturing context information associated with user-defined data created by user interaction of a user in a first context of the network-based system, the context component dynamically storing the context information in metadata associated with the user-defined data, the user-defined data and metadata stored on a storage component of the network-based system; and a computer-implemented tracking component of the network-based system for tracking a change of the user from the first context to a second context of the network-based system and dynamically updating the stored metadata based on the change, wherein the user accesses the data from the second context.

Facebook has also been sued for patent infringement by PA Advisors (Patent No. 6,199,067; dismissed with consent of parties) and Cross Atlantic Capital Partners (Patent No. 6,519,629; Litigation stayed pending reexamination).

Rewarding Breakthrough Innovation

I understand that design patents are worth only a fraction of their utility patent namesakes. Each year, the number of design patent applications are only a small fraction of the number of utility patent applications filed., and design patents are – on average – less valuable than utility patents.

I do believe that utility patent law can learn something from design patent law. Let's start with the recent en banc design patent case of Egyptian Goddess v. Swisa. In that case, the Federal Circuit defined the meaning of "infringement" of a design patent. The test created by the court looks to whether an "ordinary observer" who is "familiar with the prior art" would find an accused design "substantially similar" to the patented design. Thus, the test looks for substantial similarity in the context of the prior art.

"When the differences between the claimed and accused design are viewed in light of the prior art, the attention of the hypothetical ordinary observer will be drawn to those aspects of the claimed design that differ from the prior art. And when the claimed design is close to the prior art designs, small differences between the accused design and the claimed design are likely to be important to the eye of the hypothetical ordinary observer."

Another way of interpreting the Egyptian Goddess test is that the scope of infringement varies inversely with the scope of prior art. When a patented design is in a field crowded with similar prior designs, the only infringing designs will be those that are strikingly similar to the patented design yet different from the prior art. Alternatively, when the patented design stands alone as a breakthrough design, the potential variety of infringing activity actually increases.

I like the idea of rewarding breakthrough innovations that go beyond ordinary invention. Here, Egyptian Goddess does that by increasing the potential claim scope when the invention goes well beyond the prior art. The question here is whether the law of utility patents can be arranged to likewise provide the best rewards for the most innovative creations.

Citation of law review articles

Citation of law review articles. On a lark, I looked at the table of authorities for about two hundred party briefs filed in the past six months at the Federal Circuit.  These briefs each cited many cases and statutes.  Notably absent, however, were cites to law review articles. Out of the two hundred briefs, only two law review articles were cited — three if you count a citation to John Duffy’s Patently-O Patent L.J. article. The famous articles:

• Jeffrey S. Dillen, DNA Patentability - Anything But Obvious, 1997 Wis. L. Rev. 1023 (1997)
• John F. Duffy, Are Administrative Patent Judges Unconstitutional?, 2007 Patently-O Patent L.J. 21.
• Mark A. Lemley et al., Divided Infringement Claims, 33 AIPLA Q.J. 225(2005).

This result goes along with the rule of thumb for Federal Circuit appellate briefs — cite only Federal Circuit cases unless you have a compelling reason to do otherwise.

Patently-O Bits and Bytes No. 78

• FTC Hearings on the "evolving IP marketplace" http://www.ftc.gov/opa/2008/11/ipmarketplace.shtm. December 5. How it will play out: In the next year, the FTC will likely publish a new report on the state of patent law in the US. That report will serve as the basis for any patent reform measures in 2010.
• Interesting article by Jim Klaiber in IP Today. He writes about a recent nonprecedential CAFC that seemingly expanded the limitations on claim amendments during reexamination. His piece is titled: Reexamination Amendments Made for an Improper Purpose – A New Basis For Invalidity Under 35 U.S.C. § 305.
• I am now on twitter: http://twitter.com/patentlyo. tweet tweet.
• The Federal District Courts in New Jersey are contemplating new local patent rules. IPO offers its "six principles" for local patent rules:
  • (1) early identification and mutual mandatory disclosure of essential infringement and validity-related discovery and consideration of staying non-essential discovery until after a claim construction decision is issued in a case;
  • (2) early disclosure and appropriate staging of detailed infringement and invalidity contentions;
  • (3) early supplementation of detailed infringement and invalidity contentions supported by identification of specific evidence produced in the early mandatory disclosures;
  • (4) scheduling any claim construction procedure early in the case but after detailed contentions have been exchanged;
  • (5) identification of claim limitations most important to the outcome of the case; and
  • (6) consideration of dispositive motions as early as appropriate to narrow issues or resolve cases without non-essential discovery.
• TIME: Best Inventions of 2008
• Wish List 2008: For the past few years, I have assembled a top-ten list of holiday gifts for patent attorneys and agents. I have heard from several spouses that actually used the list. So – let Santa's helper (me) know if there are any particular machines or articles that should make the list.

Software Method Claims: Bilski in light of Benson

In re Bilski and Gottschalk v. Benson

It is important to remember that the Supreme Court's decision in Gottschalk v. Benson is still controlling law. In that 1972 decision, the Supreme Court held unpatentable a method of converting a signal from "binary coded decimal" into "binary." The Benson method operates by using a "reentrant shift register" – a particular electronic memory circuit of the day. The rejected claim reads as follows:

8. The method of converting signals from binary coded decimal form into binary which comprises the steps of: storing the binary coded decimal signals in a reentrant shift register, shifting the signals to the right by at least three places, until there is a binary `1' in the second position of said register, masking out said binary `1' in said second position of said register, adding a binary `1' to the first position of said register, shifting the signals to the left by two positions, adding a `1' to said first position, and shifting the signals to the right by at least three positions in preparation for a succeeding binary `1' in the second position of said register.

In Bilski, the en banc court struggles with Benson because – on its face – the rejected Claim 8 from Benson satisfies the machine-or-transformation test of Bilski. The claimed BCD conversion method is tied to a particular machine. The Bilski majority admits as much: "the claimed process operated on a machine, a digital computer, but was still held to be ineligible subject matter." According to the en banc panel however Benson's claim still fails the machine-or-transformation test because the claimed physical limits were "not actually limiting." In particular, since the only uses of the BCD converter would be on a computer, tying the claims to a computer offered no practical limitation to the otherwise preemptive claim of an algorithm.

"[I]n Benson, the limitations tying the process to a computer were not actually limiting because the fundamental principle at issue, a particular algorithm, had no utility other than operating on a digital computer."

Thus under Bilski/Benson, tying a software algorithm to particular computer hardware may well be unpatentable subject matter if the patent would still preclude all practical uses of the otherwise unpatentable algorithm.

Notes:

• Patently-Unobvious suggests that careful drafting could have avoided the whole problem for Benson: "If only the inventors had been less forthcoming, more obtuse, and called their claim a method for operating a shift register, who would have seen that the machine-implemented signal processing method surprisingly also happens to convert a binary coded decimal signal into a binary coded one?"

NonObviousness: Analogous Arts Test Still Strong

Andersen v. Pella (Fed. Cir. 2008)(non-precedential)

Andersen sued Pella and WL Gore for infringement of its window screen patent. Apparently, the patented screen allows ventilation and blocks insects, but is easier to see through than traditional screens. The claims focus on the diameter and strength of the screen wires and as well as on the screen's "transmittance" and "reflectance" properties.

Prior to KSR, the district court had rejected the defendant's summary judgment motions on obviousness – finding that the prior art references lacked a motivation to combine. After KSR, the district court reversed course – this time granting summary judgment of invalidity based on obviousness of the claimed screen. In its analysis, the district court asked and answered the following question: "would an insect screen manufacturer of ordinary skill have found it obvious to use the [prior art] screening material, decrease its reflectance value, bond it, and place it in a window frame? The answer, plain and simple is 'Yes.'" According to the lower court, the prior art mesh was the "heart" of the claimed invention, and it was a "simple act of common sense" to slightly modify the mesh and apply it to a window. Although secondary factors of nonobviousness were shown, the lower court found they were not enough to rebut a strong showing of obviousness.

Analogous Arts: On appeal, the Federal Circuit vacated – finding material facts that prevent summary judgment of obviousness. In particular, the appellate panel found that the prior art mesh might not count as nonobviousness type prior art because it "outside the scope and content of the prior art." The court based its decision on three issues: (1) the prior mesh was not in the same "insect screen manufacturing field"; (2) there was some evidence that the prior mesh would not be useable for an insect screen (teaching away); and (3) the PTO specifically considered the reference before granting the patent and should be given some deference.

Upon our review of the record in the light most favorable to Andersen, we find support adequate to overcome summary judgment on the question of whether the TWP mesh was outside the scope and content of the prior art. Andersen put forth evidence in the record that, one, the TWP mesh was not part of the insect screen manufacturing field, and, two, an insect screen manufacturer would have read the prior art to teach away from using a mesh with the characteristics possessed by the TWP mesh. This field-of-invention and teaching-away evidence, combined with the deference owed to the PTO's issuance of this patent after reviewing the same prior art references that form the basis of this obviousness challenge, raises a genuine issue of material fact as to whether an ordinarily skilled insect screen designer would have found the combination of the TWP mesh with the other prior art references obvious.

Teaching away and price feasibility: One of the 'teaching away' arguments accepted by the Federal Circuit was that of price infeasibility. Andersen had argued that the prior mesh would not have been considered by a designer because it was quite "extraordinarily expensive." In its holding, the appellate panel gave backing to the notion that a high price would discourage consideration of a potential prior art reference.

As to the third characteristic, pricing, Andersen's expert, Laurence Armstrong, stated that the TWP mesh was "extraordinarily expensive in comparison with traditional insect screen material, costing about $75.00 per square foot." It is not unreasonable to suggest that a significant difference in cost could discourage an insect screen designer from using the more expensive mesh. . . . On the whole, we think, the record creates a genuine issue of material fact as to whether the durability, transparency, and pricing of the TWP mesh would have discouraged an ordinarily skilled artisan from incorporating the mesh into an insect screen.

Summary judgment vacated.

New PPAC Members

The Secretary of Commerce (with the advice of the PTO Director) has named three new member of the Patent Public Advisory Committee (PPAC): Marc Adler; Stephen Pinkos; and Maureen Toohey. Mr. Adler is well known in the patent community as the past president of both the IPO and the ACPC. Adler has called for patent quality reforms that put more responsibilities on both the PTO and Applicants. Stephen Pinkos is a former deputy director of the PTO where he managed daily operations of the office. Maureen Toohey has her own law firm in Boston. She has apparently represented Dean Kamen in the past and clerked for Judge Rader.

The committee's purpose is to advise the PTO Director on the management of operations of the Office. The nine-member PPAC is on a three-year rotating schedule. Each year three new members are appointed. For each day of actual service, the PPAC members will be paid the equivalent of an Executive Level III salary (annual rate of about $150,000).

Patently-O Bits and Bytes No. 77

• Acting Patent Commissioner Focarino recently reported on the rising use of the Patent Office Electronic Filing System (EFS) for filing patent applications. Kudos to the PTO on a system that works well! (The graph below is built from Commissioner Focarino's data).

  

• I wonder how electronic filing impacts prosecution speed and quality?
• Great article on Biotech 101 (i.e., subject matter patentability of biotech) by Philip McGarrigle and Vern Norviel. It is pre-bilski, but considers many of the same issues. http://www.chtlj.org/pdf/24-2_McGarrigle.pdf.
• BountyQuest II: http://www.articleonepartners.com.
• Patent Law Jobs: Los Angeles / Washington D.C.; ITC Litigator; Part-time; IP Fellowship Washington D.C.; Chicago; Wilmington, N.C.; Orange County & Los Angeles; Alexandria, Va.; Philadelphia; Menlo Park.

Malpractice and the Statute of Limitations

Wright v. Renaldo, 279 Mich. App. 526 (Mich. Ct. App. 2008)

Wright sued Renaldo and her firm for legal malpractice involving the prosecution of his patent directed to an absorbent mat. Renaldo allegedly erred in (1) failing to remove the name of an originally listed co-inventor; (2) "improperly drafted documents submitted to the patent office, and (3) failed to recognize and take steps to correct the patent because it did not adequately protect Wright's invention."

Without reaching the merits of the malpractice claim, the court agreed that the claim was barred by a Michigan two-year statute of limitations. Under Michigan law, a plaintiff "must file a legal-malpractice action within two years of the attorney's last day of service to the plaintiff or within six months of when the plaintiff discovered or should have discovered the claim, whichever is later." Here, there was evidence that Wright had been planning a malpractice claim for over two years after White revoked her power of attorney and hired different counsel.

A dissenting judge argued that the two-year time line had not expired because Renaldo had not learned of the revocation of the power of attorney until much later.

Although the patent attorney won this case, it should serve as a reminder to counsel to promptly memorialize a disengagement.

Patent Practice: Annual Practitioner Maintenance Fee.

[NEW RULES] The USPTO has announced final rules to implement an annual practitioner maintenance fee. According to the new rules effective December 17, 2008, a practitioner who fails "to pay the annual practitioner maintenance fee required under § 11.8(d) [will] be administratively suspended." Easy to remember, the Fee under Section 11.8 is $118.

What is the point: The $118 fee will raise two or three million dollars for the PTO. Although that money is useful, the primary purpose of the fee is not to raise money. Rather, it an easy way to cull the list of registered practitioners by removing those who are not making money as patent attorneys. In the words of the office, the purposes of the fee include "protecting the public, preserving the integrity of the Office, and maintaining high professional standards."

When folks forget to pay:

[A] paper submitted in good faith by a practitioner who does not know that he or she has been administratively suspended for failure to pay the annual practitioner maintenance fee will be treated as unsigned. In the case of a new complete application, the applicant will receive a filing date because the signature of an attorney or agent on transmittal papers is not required. In the case of an unsigned bona fide response to an Office action, the submission will be treated in accordance with 37 CFR 1.135(c), and applicant may be given a new period of time to supply the omission. Practitioners should be aware, however, that submission of a response having an omission may affect patent term adjustment pursuant to 37 CFR 1.704(c)(7). In the case of an issue fee payment, an unsigned issue fee transmittal form may lead to abandonment of the application, in which case a petition to revive would be required.

 Who can afford this?

The Office estimates that, in 2006, the average annual income in the United States of solo practitioners was $231,777; of patent attorneys who are partners in private firms, $434,464; of patent attorneys who are associates in private firms, $152,677; and of corporate IP attorneys, $198,109; and the average annual salary of patent agents in a firm in the United States was $92,761. AIPLA Report of the Economic Survey 2007.

In many ways, the high average incomes of patent attorneys and patent agents are due to the limits created by the PTO.  When only a few can practice patent law, those few are able to charge higher prices.  Under traditional protectionist thinking, the Bar would want to take steps that solidify the monopoly by encouraging further barriers to entry and take pains to show that the limits on practice lead to better results.

Notes:

• These final rules are based on a minor portion of a five-year-old 2003 notice of proposed rulemaking. [LINK]
• The proposed rules would have added continuing education requirements as well.
• At that time, the AIPLA stated that it was “conceptionally … not opposed to an annual fee for registered practitioners.” The organization was, however, concerned with the practicalities of paying and with the problems created by attorneys forgetting to pay.
• The following anonymous coment was submitted in response to the 2003 rule proposal:

Dear Bureaucrats: Stuff your annual fees for attorneys and agents. You are really getting to be a bunch of greedy pigs. The fee structure is venal and complex enough as it is. Actually taxes should pay for mast of the PTO, but while you are not to blame for that, your asskissing desire to show your superiors haw you can rake in profits with nasty, petty little fees for ever trivial action is on your heads. Stuff your continuing education also. If you people would keep your Rules of Practice up to date and written in intelligible language instead of insider bureaucratic gobbledygook there would be no need for continuing education. How hard is is to keep your Rules up to date in this era of wordprocessing? If the Manual of Patent Examining Procedure has grown from 1 inch to 5 inches in the span of a couple of decades, maybe the problem is with too many stupid petty rules and fees to understand. God knows writing patent applications isn't that hard. We need a five inch manual for this? Are you people martyrs over there? All I ever hear is whining and attitude that the public should do all the work in prosecuting patent applications so the poor bureaucrats can twiddle their thumbs. Why don't you get it over with and specify that applicants should do a self?examination as to patentability and swear that it is accurate under penalty of law so that the Patent Office doesn't have to do anything? You people are out of control. It is time the the PTO is privatized so we get less attitude.

Graham Analysis Not Necessary for Obviousness-Type Double Patenting Rejection

In re Baselle Poliolefine Italia (Fed. Cir. 2008)

Nobel Prize winning chemist Giulio Natta filed for patent protection in 1954 on a process for polymerizing ethylene. One of Natta's continuation patents issued in 2002. Later that year, the PTO initiated a Director-ordered reexamination based on obviousness type double patenting. Later, the BPAI affirmed the rejection. On appeal, the Federal Circuit affirmed the rejection in a 2-1 split. The majority held that the one-way obviousness type double patenting rejection was appropriate. Judge Newman dissented – arguing that the reexamination was conducted illegally and that the court's findings were unsupported by the evidence.

The interesting legal issue here is the reminder that the obviousness determination for double patenting may be different than Section 103(a) obviousness.

Indeed, "this court has endorsed an obviousness determination similar to, but not necessarily the same as, that undertaken under 35 U.S.C. § 103 in determining the propriety of a rejection for double patenting." In re Braat, 937 F.2d 589 (Fed. Cir. 1991). Hence, we find no basis for reversing the Board's decision merely because the Board failed to expressly set forth each of the Graham factors in its analysis. The Board carefully considered claim 1 of the '987 patent and the claims of the '687 patent and determined that a person of ordinary skill in the art would have found the '687 patent claims to have been obvious. We find no error in the Board's analysis.

Of historical interest here is the timeline:

• 1954: Natta files Italian Appn. No. 25,109.
• 1955: Natta files US Appn. No. 04/514,098 patented in 1971 as No. 3,582,987.
• 1955: Natta files US Appn. No. 04/514,097 (now abandoned) claiming priority to the Italian appn.
• 1958: Natta files US Appn. No. 04/710,840 (now abandoned) as divisional of the '097 appn.
• 1958 – 1983: "multiple interferences."
• 1983: Natta files US Appn. No. 06/498,699 (now abandoned) as continuation of the '840 appn.
• 1986: Natta files US Appn. No. 06/906,600 (now abandoned) as continuation of the '699 appn.
• 1990: Natta files US Appn. No. 07/607,215 (now abandoned) as continuation of the '600 appn.
• 1991: Natta files US Appn. No. 07/719,666 (now abandoned) as continuation of the '215 appn.
• 1992: Natta files US Appn. No. 07/883,912 as continuation of the '666 application.
• 1999: CAFC decides in re Natta, 194 F.3d 1333 (both parties agreed to further examination).
• 2002: PTO issues Patent No. 6,365,687 based on '912 appn.
• 2002: PTO orders reexamination of the '687 patent based on double patenting.
• 2008: CAFC affirms invalidity of the '687 patent based on obviousness type double patenting (as compared to the '987 patent).

Patent Reform: Next Stop USPTO

Ron Katznelson has become a leading patent data guru. In a recent talk at UC Davis Law School, he presented is ideas that the next focus of patent reform should be on USPTO Operations. His focus remains on (1) pendency and (2) quality without limiting patentee rights. Katznelson calls for an optional deferred examination for those applicants willing to go slow. In his schema, a third party worried about a pending application could request examination of a deferred application. With some financial incentives (such as a substantial examination fee), many voluntary deferred applications may become voluntary abandoned claims due based on obsolescence or low market potential (creating a "substantial workload reduction").

As shown below –the pendency problem is growing.

Katznelson also discussed the enjoined PTO continuation & claim rules. The beautiful graph below helps illustrate the significant number (about 30%) of patent applications having more than 5 independent or 25 dependent claims.

On the continuation side, Katznelson had to resort to a logarithmic axis to show the continuity chain distribution at the PTO.

Notes:

• These are reprinted with permission
• Download Ron Katznelson presentation

Patently-O Bits and Bytes

Next PTO Directors: The PTO has 200 years of inertia and set expectations. Today, the PTO is a billion-dollar enterprise and the PTO Director's first job is to manage that ship. However, the director should also have a visions and goals for the future of the PTO and the patent system. Along with Chief Judge Michel and a few other key players, the PTO director is seen as the leader of the US patent system. The vision of the next director will have a great impact on the potential for patent reform; international patent cooperation; and the role for industrial design protection. Part of Obama's overall agenda is to move toward an open and transparent government. The PTO has come a long way, but the new director and deputy should be on board with ways to increase the communication channels and the ability for third parties and competitors to monitor the patenting process. Many are calling for the next PTO director to have patent prosecution experience. I agree that such experience will be helpful – both in understanding the system and for credibility. However, being a career prosecutor does not necessarily coincide with having the vision and leadership necessary for the job. Lots of speculation on upcoming PTO Officials.

• But first: The National Academy of Science published a book suggesting guidelines for the "most critical" Science and Technology Appointments of the new administration. PTO appointments do not make the list.
• John Doll is expected to become the PTO director temporarily until a new director and deputy are appointed. At that point, he will most likely move back to his role as Commissioner of Patents.
• Several sources (perhaps stemming from the same core) have identified former PTO trademark examiner Shanna Winters as a potential successor to either Mr. Dudas or Ms. Peterlin. Ms. Winters played a key role in the passage of the properly maligned House Patent Reform Act of 2007. Her staff position in the House is necessarily shifting as the IP subcommittee is being abolished. Patent reform in the next Congress will be dealt with directly by the Judiciary Committee – led by Rep Conyers.
• Some are calling for Todd Dickinson to return to his former post. He recently took over as executive director of the AIPLA.
• Professors Rai, Lemley, Noveck, Lesseg (and the vast majority of other law professors) have been strong Obama supporters. Professor Rai was a classmate of Obama at Harvard Law School. She was Executive Editor of the Harvard Civil Rights-Civil Liberties Law Review while Obama led the Harvard Law Review.
• I would be fully behind the nomination of Kevin Noonan.  (* Full Disclosure – Kevin is a partner at MBHB, my former employer and the primary Patently-O advertiser).
• I suspect that none of these folks will get the call.
• Notes: Joff Wild (qualities of PTO director); Gene Quinn (Nominating Paul Kamenski); Hal Wegner (“If you had a very good, honest broker that both sides could admire and respect, then common elements could be found in a solution.”)

Stanford IP Litigation Clearinghouse: Speaking of Mark Lemley – He and attorney Joshua Walker (who also knows Obama…) are leading an amazing new project titled the Stanford IP Litigation Clearinghouse. The free service tracks over 23,000 US District Court cases filed since 2000 and includes in depth real time information "that cannot be found elsewhere in the public domain." [Invitation to Launch]

Wii Infringing? Motiva has sued Nintendo in the Eastern District of Texas. The young superstar plaintiff's attorney Mark Lanier is representing the patentee. U.S. Patent 7,292,151. In his blog, Blaise Mouttet noted the potential that the Wii infringed back in 2007. [Link]

How Long Do I Wait for a First Office Action [Updated Data]

Based on the USPTO's most recent numbers on examination, I created an updated table of the average delay until a first office action is mailed from the PTO. These numbers reflect an average for each technology center as it operates today.  The 3.7 year delay in Fuel Cell and Battery Technology (TC 1795) means that the applications receiving first office actions from that TC during the past three months were filed 3.7 years ago on average — taking us back to early 2005.  The numbers do not necessarily reflect how long it would take for an application filed today to make it through. (Although it is perhaps one of the better estimates that we have on hand.).

Technology Center	Description	Months	Years
1795	Fuel cells batteries solar	44.8	3.7
1791	Tires, adhesive bonding, glass	43.8	3.7
1797	Separation, purification	43.8	3.7
1610	Pharmaceutical formulations	42.9	3.6
3680-B	Business Methods	42.3	3.5
3620	Electronic Commerce	40.7	3.4
1792	Coating etching cleaning	40.4	3.4
1794	Food stock materials	39.4	3.3
2130	Cryptography security	39.2	3.3
2140	Computer networks	38.8	3.2
2190	Interprocess communications	38.5	3.2
2620	Television and TV Recording	37.2	3.1
1796	Organic chemistry and polymers	35.4	3.0
1793	Metallurgy metal working	34.9	2.9
2610	Digital Communications General	34.8	2.9
1620	Organic chemistry	34.1	2.8
3640	Aeronautics	34.1	2.8
3680-A	Business Methods - Finance	33.9	2.8
3630	Static structures	30.5	2.5
3650	Material handling	29.3	2.4
2110	Computer architecture	29.2	2.4
3610	Surface transportation	29.1	2.4
2120	Miscellaneous computer	28.3	2.4
3780	Package and Article Carriers	26.9	2.2
2160	Database and file management	26.9	2.2
3670	Wells earth boring	26.7	2.2
3680-A	Machine elements	26.7	2.2
1630	Molecular biology	25.9	2.2
1650	Fermentation microbiology	25.6	2.1
2180	Computer architecture	24.9	2.1
3750	Fluid handling and	24.9	2.1
1640	Immunology receptor ligands	24.2	2.0
2811+	Semiconductors and	23.9	2.0
2871+	Liquid crystals optical	23.7	2.0
3730	Medical instruments	23.4	2.0
3710	Amusement	22.9	1.9
2816+	Electronic circuits static	22.6	1.9
3660	Computerized vehicle	22.4	1.9
3770	Respirators Therapeutic	21.9	1.8
2831+	Electronic conductors	21.9	1.8
3760	Body treatment	21.4	1.8
1660	Plants	21.3	1.8
3720	Manufacturing devices	20.4	1.7

 

Survey results: Would Metabolite's claim 13 be found patentable under the reasoning of Bilski?

Earlier in the week, I wrote about Bilski in relation to the recent diagnosis patent case of LabCorp v. Metabolite. Metabolite's claim 13 reads as follows:

13. A method for detecting a deficiency of cobalamin or folate in warm-blooded animals comprising the steps of: assaying a body fluid for an elevated level of total homocysteine; and correlating an elevated level of total homocysteine in said body fluid with a deficiency of cobalamin or folate.

I asked the following question to Patently-O readers and received a response from about 200 readers: It reads as follows:

Would Metabolite's claim 13 be found patentable under the reasoning of Bilski?

The response can be broken down as follows: 31% of responses would find the claim to include patentable subject matter while the remaining 69% would reject the claim under Section 101. Of those who would find the claim patentable, the vast majority (89%) reason that the claim includes a transformation. In my discussion of the case, I indicated one argument for showing how the assay step could be considered a transformation. The remaining 11% of those who would find the claim patentable say that it is tied to a particular machine or apparatus. None of the responses indicated that the claim satisfied both the machine and transformation prongs of the test.

Of the 69% of "unpatentable" responses, the majority (72%) saw the claim unpatentable as neither a machine nor a transformation. 43% of those asserting unpatentability saw the claim as unpatentable under the revived mental steps doctrine of bilski. Included in these figures is the 16% who saw the patent violating both the revived mental steps doctrine and the machine-or-transformation test.

The survey did not ask demographic data. However, of those responses using a USPTO IP address, 86% would find the claim unpatentable under Section 101.

Post-Bilski BPAI Approves of Beauregard Claims

Ex parte Bo Li, Appeal 2008-1213 (BPAI 2008)

Li's patent application claims a computer program product stored on a computer readable memory adapted be executed to implement a report generation method. The computer program product is a typical Beauregard claim. In what appears to be the first decision to cite the new Bilski machine-or-transformation test of patentable subject matter, the BPAI overturned the examiner's Section 101 rejection – finding that the product claim includes statutory subject matter.

Here, the examiner argued that the claimed computer program product could not be patentable because it did not produce "a useful, concrete and tangible result." On appeal, the BPAI held that Bilski expressly rejected that statement from State Street. However, because Li's claim was for a product, the BPAI did not apply the Bilski machine-or-transformation test to determine patentability. Rather, the court merely relied on the notion of that claimed products – even when written as Beauregard claims – are patentable.

"It has been the practice for a number of years that a "Beauregard Claim" of this nature be considered statutory at the USPTO as a product claim. (MPEP 2105.01, I). Though not finally adjudicated, this practice is not inconsistent with In re Nuijten. Further, the instant claim presents a number of software components, such as the claimed logic processing module, configuration file processing module, data organization module, and data display organization module, that are embodied upon a computer readable medium. This combination has been found statutory under the teachings of In re Lowry, 32 F.3d 1579 (Fed. Cir. 1994). In view of the totality of these precedents, we decline to support the rejection under 35 U.S.C. § 101."

Li won the Section 101 battle, but still lost the war – the BPAI affirmed the examiner's contention that the claim was also unpatentable as obvious.

Notes:

• Thanks to Amber Rovney of Weil's Austin office for first noting the opinion.  
• Assignee is IBM, but originally filed as a Korean Application.
• The approved-of claim is drafted as follows:

42. A computer program product, comprising a computer usable medium having a computer readable program code embodied therein, said computer readable program code adapted to be executed to implement a method for generating a report, said method comprising:

• providing a system, wherein the system comprises distinct software modules, and wherein the distinct software modules comprise a logic processing module, a configuration file processing module, a data organization module, and a data display organization module;
• parsing a configuration file into definition data that specifies: a data organization of the report, a display organization of the report, and at least one data source comprising report data to be used for generating the report, and wherein said parsing is performed by the configuration file processing module in response to being called by the logic processing module;
• extracting the report data from the at least one data source, wherein said extracting is performed by the data organization module in response to being called by the logic processing module;
• receiving, by the logic processing module, the definition data from the configuration file processing module and the extracted report data from the data organization module; and
• organizing, by the data display organization module in respone to being called by the logic processing module, a data display organization of the report, wherein said organizing comprises utilizing the definition data received by the logic processing module and the extracted report data received by the logic processing module.

Trends in patent complaints

Prof. Paul Janicke at the University of Houston Law Center is an expert on patent litigation statistics. He recently sent me a note about some recent trends in the filing of patent complaints.

Over the last three years, patent lawsuit filings have been fairly steady at around 2,700 annually. This year to date they seemed on track to stay at that level or a little higher, with filings through Oct. 31 standing at 2,327. However, filings in recent months are down about 20%, possibly due to the general financial conditions of September and October.

Patent Suits filed in September and October (all districts):

Year	Filings in Sept.-Oct.
2008	409
2007	513
2006	486

Eastern District of Texas patent suit filings in September and October:

Year	ED Tex Filings in Sept.-Oct.
2008	55
2007	68
2006	59

Firm Disqualified from Representing Patentee in Malpractice Suit After Defending Deposition of Prosecuting Attorney

Touchcom v. Bereskin & Parr (Fed. Cir. 2008)(non-precedential order)

This is an attorney malpractice case. The Canadian firm Bereskin & Parr prepared and prosecuted Touchcom’s US patents relating to fuel pumps. Touchcom then sued Dresser, Inc, but lost when the district court granted summary judgment of invalidity under 35 USC 112 (indefiniteness). After that loss, Touchcom sued the B&P for malpractice in preparing and filing the patent application.

Wildman Harrold represented Touchcom in the original infringement action and also in the malpractice case. During the original litigation, Wildman Harrold had also defended the deposition of the B&P patent agent who had filed the case.  Based on that conflict, B&P asked that Wildman firm be disqualified from arguing the appeal, and the Federal Circuit agreed.

In a non-precedential order, the Federal Circuit agreed to disqualify the Wildman Harrold firm. Because the malpractice case arose in the Eastern District of Virginia, the court applied Virginia Professional Conduct Rule 1.9.  That rule prohibits (without consent) an attorney from being adverse to a former client in a matter substantially related to the prior representation.

“A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless both the present and former client consent after consultation.” Rule 1.9.

Wildman agreed that it had represented the patent agent and that the matter was substantially related. However, Wildman argued that it could turn against its former client because the firm was representing both Touchcom and the B&P patent agent.  And, the nature of the litigation meant that the B&P patent agent had no expectation that Wildman would keep any secrets from Touchcom.

Following the only Virginia case on point (an unpublished opinion), the Federal Circuit disqualified the Wildman Firm — finding that Rule 1.9 establishes broad “standards of attorney loyalty” that go beyond client confidences.

Holding: The motion to disqualify is granted to the extent that attorneys from Wildman Harrold are disqualified from representing Touchcom in this case. Replacement counsel for Touchcom is directed to file an entry of appearance within 30 days of the date of filing of this order.

 

Patent Demand – A Simple Path to Patent Reform

[Read Tim Wilson’s Paper] Tim Wilson (Senior IP Counsel at SAS US) has been concerned about patent quality for some time. In part, the sheer number of patent applications being filed creates a host of problems. Wilson's solution is to raise patent fees – he says the fees should go as high as $50,000 for large corporate applicants. The result – according to natural tendencies of supply and demand – is that fewer applications will be filed and fewer patents will issue. In all likelihood, however, those that are filed will be better applications covering higher quality inventions.

Wilson did not simply pull his $50,000 figure out of his ear. Using the powerful computing resources of SAS, Wilson calculated an estimated demand curve for patent applications using both (1) historical filing reactions to increases in PTO fees and (2) an assumption that the budgets of corporate patent departments is fairly inelastic. Wilson then created his Figure 5 – showing the demand curve for patent applications drawn with respect to the patent application fees.

Wilson's approach is admittedly only an estimate, but his intuition has to be correct that a dramatic increase in PTO fees would lead to a dramatic decrease in PTO filings.

An average high technology patent contains a minor improvement on a small portion of a product and the patent application is typically written using outside counsel working for a flat fee of a few thousand dollars. Imagine what would happen to the high technology company's patent process if each patent application cost $50,000 just to file. The high technology company would file far fewer, but more important patent applications and they would spend more time and effort doing so. The pharmaceutical company's process probably would not change much because a billion dollar decision depends on the outcome of the patent process. What would happen to non-practicing entities, sometimes derisively referred to as patent trolls? I believe that these entities will change to patent market facilitators, or cease to exist. When the value of all patents is increased substantially, it is very unlikely that any patent will be available to fall to these non-practicing entities. First, each individual patent will be more valuable to the current owner of that patent, so it will be less likely that an owner would be willing to part with it to a troll. Second, if a company does fail, competitors of that company may be more willing to buy that patent rather than allow it to fall to a company that may sue the competitor. Finally, fewer issued patents mean that it will be easier for companies to monitor patents issuing in their product space and less likely that they will allow those patents to fall into the hands of a troll.

DDC Comment: Wilson's proposal has some merit, and his work on the demand curve is especially interesting. However, the proposal suffers from three fundamental problems: First, the proposal implicitly equates economic value with technologic value – the two are related but different. Many important technical advances have only limited economic value, but still serve as building blocks for future advances. (i.e., standing on the shoulders of giants). Second, the proposal greatly favors technologies where the economic value is well known up front. Again, many important technologies are eventually found valuable – but the very high up-front price will greatly limit those applications – and consequently, the upstream incentive to innovate in that area. Third, the proposal favors firms with cash – i.e., those that have performed well in the past and have saved their money. However, many innovation experts believe that most of the breakthrough work comes from these mainstream companies. To his credit, Wilson addresses this problem by stating that the high-price only applies to large companies. However, that approach would tend to allow the "non-practicing entities" to continue to obtain patents (against one of Wilson's primary goals). In addition, the prospect of small entities paying only $500 while large entities pay $50,000 would surely lead to other political and practical problems.

• Tim's paper is published in the recent edition of the International In-house Counsel Journal.

  

Applying Bilski to Metabolite’s Diagnosis Claim

Metabolite's broadest method claim has two steps: First, assay a body fluid to determine its homocysteine level. Second, correlate the homocysteine level to a vitamin deficiency. It reads as follows:

13. A method for detecting a deficiency of cobalamin or folate in warm-blooded animals comprising the steps of: assaying a body fluid for an elevated level of total homocysteine; and correlating an elevated level of total homocysteine in said body fluid with a deficiency of cobalamin or folate.

In 2006, the Supreme Court almost took the time to reject this claim under Section 101, but decided that the issue had not been properly raised on appeal. Dissenting from the last minute denial of certiorari were Justices Breyer, Stevens and Souter. In a dissenting opinion drafted by Justice Breyer, the three would have held the invention as claimed an unpatentable "law of nature." The same anti-preemption theme of Bilski also runs through the Breyer opinion. The courts are concerned with the potential (but unidentified) problems of having a patent that

There can be little doubt that the correlation between homocysteine and vitamin deficiency set forth in claim 13 is a "natural phenomenon." . . . . Claim 13 . . . tells the user to use any test at all. Indeed, to use virtually any natural phenomenon for virtually any useful purpose could well involve the use of empirical information obtained through an unpatented means that might have involved transforming matter.

I thought it would be interesting to attempt to apply the Bilski decision to Claim 13 to judge its patentability.

[SURVEY: DOES CLAIM 13 PRESENT PATENTABLE SUBJECT MATTER]

Bilski offers two avenues for showing that a claimed process is patentable. First, the process will be patentable if it is tied to a particular machine or apparatus. Alternatively, the process will be patentable if it "transforms a particular article into a different state or thing." According to the court, "particular article" does not necessarily need to be physical, but it must at least be "representative of physical objects or substances."

Machine: Metabolite's Claim 13 easily fails the first prong of the machine-transformation test because the claimed method is not tied to any particular machine.

Transformation: The "correlating" step could be performed in a human mind and consequently cannot serve as the basis for finding patentable subject matter. As the court noted in Bilski – a process step that "may be performed entirely in the human mind is obviously not tied to any machine and does not transform any article into a different state or thing."

The "assay" step could follow the same analysis – if it is possible to "assay a body fluid for an elevated level of total homocysteine" only using the human mind then no there is no credible transformation. The mental step potential may be true if, for example, the body fluid's homocysteine level is visually apparent. [Interesting timing issues here, at the time of the invention, the assay involved extensive lab work, but later-invented technology has dramatically changed the process.]

Assuming that "assaying a body fluid for an elevated level of total homocysteine" cannot be done in the mind, we must then ask whether the claim requires a transformation of a particular physical object or substance or at least transformation of a particular article that is "representative of physical objects or substances." Perhaps the best physically related transformation involves transforming the "body fluid" into an indication of elevated homocysteine level and then into an indication of vitamin deficiency. Under Abele, both homocysteine level and vitamin deficiency do represent physical substances – consequently their 'creation' may be "sufficient to render that … process patent-eligible." [Of course, this analysis may apply a loose definition of 'transformation.']

Notes:

• What do you think: [SURVEY: DOES CLAIM 13 PRESENT PATENTABLE SUBJECT MATTER]. I'll post results on Thursday or Friday. [See ongoing results here]
• Want more on Bilski: Professors Merges (UC Berkeley), Duffy (GWU), and Lichtman (USC) discuss Bilski on Professor Lichtman's new radio show - the www.ipcolloquium.com (Free CLE)

Constitutionality of the Marking Statute

Pequignot v. Solo Cup (E.D.Va. 2008)

Earlier this year, I discussed patent attorney Matthew Pequignot's two "false marking" lawsuits pending in the Eastern District of Virginia. 35 U.S.C. § 292 is a penal statute and calls for damages of "not more than $500" for each false marking offense.

In an interesting turn, Solo Cup recently moved to dismiss the case based on its argument that Section 292 is unconstitutional. Now, the US Government has filed a motion to intervene and will argue (in support of the plaintiff) that the false marking statute is valid. 

On the other side, Solo Cup argues that the statute gives the courts extraconstitutional power. The statute allows any party to sue and collect half of the statutory reward, but the statute does not explicitly provide that the private lawsuit be filed on "behalf of the US Government." These two facts lead to Solo's argument that the court lacks Article III jurisdiction. (And that Congress had no power to enact the statute – leading to separation of power problems). 

Pequignot response will likely win the day: "given that qui tam statutes are older than the Republic, Solo fails to cite even one judicial decision holding that such provisions, including § 292, violate the Separation of Powers doctrine."

According to the USDOJ brief, the same issue has been raised in two other pending cases: Harrington v. CIBA Vision Corp., No. 3:08cv00251 (W.D. N.C.) and North Carolina Farmers' Assistance Fund, Inc. v. Monsanto Co., et al., No. 1:08-cv- 409 (M.D. N.C.).

• File Attachment: USDOJ Intervention (46 KB)
• File Attachment: SOLO Motion (496 KB)
• May 2008 Discussion of Pequignot cases

“Barack,” “Obama,” and the Trademark Office

By Mark Reichel. Mark Reichel is a patent attorney at the Ice Miller firm and writes the "daily dose of IP."

After such an exciting election, I thought I'd have some fun with a blog post and highlight a few attempts to register trademarks pertaining to our President-elect that, for reasons shown below, were unsuccessful: "BARACK STAR" – U.S. Trademark Application Serial No. 78/471,745 in IC 016 and 025 – This application was abandoned after the USPTO refused registration for false association because "the proposed mark consists of or comprises matter which may falsely suggest a connection with U.S. Senator Barack Obama" and "[a]lthough not connected with the goods or services applicant provides under the proposed mark, the name BARACK is so famous that consumers would presume a connection with Senator Obama." "DO YOU SMELL WHAT BARACK IS COOKING" - U.S. Trademark Application Serial No. 77/406,936 in IC 025 – This application was abandoned after the USPTO refused registration "under Section 2(c) of the Trademark Act, for the record does not include the written consent of Barack Obama, the name of the living individual identified in the proposed mark." "PET BARACK" - U.S. Trademark Application Serial No. 77/408,020 in IC 020 – This application was abandoned after the USPTO refused registration using the same lack of consent argument as described above. "OBAMA -- O BABY!" - U.S. Trademark Application Serial No. 78/745,546 in IC 026 – This application was abandoned after the USPTO refused registration using a false connection argument similar to the false association argument described above. "OBAMA SO PHAT" - U.S. Trademark Application Serial No. 77/135,294 in IC 040 – This application was abandoned after the USPTO refused registration using the same lack of consent argument as described above. "OBAMA NOT YOUR MAMA FOR PRESIDENT IN 2008" - U.S. Trademark Application Serial No. 77/037,088 in IC 040 – This application was abandoned after the USPTO refused registration for false association and lack of consent as described above. In addition to the foregoing, I note one additional trademark application (77/086,418) that I will not describe here due to its sensitive and offensive nature, and of which I am personally pleased to see rejected for a multitude of reasons.

* * * * *

Following Mark's lead, I also found this mark for Gov. Palin [also offensive] and a host "joe the plumbers" including several actual plumbers.

California Malicious Prosecution Charges Based on PTO Interference

Plumley v. Mockett, 79 Cal. Rptr. 3d 822 (California Ct. App. 2008) 79 Cal.Rptr.3d 822

Interesting case from California state court. Plumley won an interference proceeding and then sued Mockett and Mockett's attorney for "malicious prosecution." The allegation was that Mocket and his patent attorney "filed the federal interference action with malice and without probable cause. In the malicious prosecution charges were dismissed, but case raises important cautions to third parties intending to request interference proceedings; request reexamination; or potentially even oppose European patent grants. In this case, both parties were located in California, and the court there did not appear concerned that the interference (the alleged malicious prosecution) was filed in a non-Californian administrative agency.

Note:

• The facts from the case are intriguing and detailed. Mockett originally sued Plumley in California court alleging that Plumley had stolen his idea. The California court, however, held that Mockett was lying and had fabricated evidence. Parallel to the original state court action, the PTO found for Mockett in the interference (noting that it was not bound by the California court's holding). On appeal, the district court flipped BPAI's holding – finding no evidence of derivation. Subsequently, the BPAI awarded the patent to Plumley. At that point, Plumley sued Mocket for malicious prosecution.

The patent at issue is a design patent covering a grommet for a desk that allows wires to pass through. U.S. Design Patent No. D 361711.

Responding to Examiner’s Charge of Burying Reference

In another recent first office action, the Examiner complained of the "voluminous references" submitted by the applicant. In this case just over 75 references were submitted.

[T]he cloaking of a clearly relevant reference by inclusion in a long list of citations may not comply with the Applicant's duty of disclosure. Penn Yan Boats, Inc. v. Sea Lark Boats, Inc., 359 F. Supp. 948 (S.D. Fla. 1972). . . . accord with dicta from Molins PLC v. Textron, Inc., 48 F.3d 1172 (Fed. Cir. 1995), stating that forcing the Examiner to find "a needle in a haystack" is "probative of bad faith." Id. [The Molins] case presented a situation where the disclosure was in excess of 700 pages and contained more than fifty references. Therefore, it is recommended that if any information that has been cited by Applicants in the previous disclosure statements is known to be material for patentability as defined by 37 C.F.R. § 1.56, applicant should present a concise statement as to the relevance of that/those particular documents therein cited.

The Examiner here appears to only recommend more detailed statements about the submissions. Under 37 C.F.R. § 1.105 and Star Fruits, the Examiner could have instead officially requested such information.

Earlier in the year Shell Oil proposed an alternative rule that would allow an Examiner to "decline consideration of [a] reference" when the reference's relevance could not be determined. In response, the "attorney could concisely point out the section or portion of the reference believed to be relevant or submit a concise statement of the relevance of the reference as a whole." [Link]

Canadian Supreme Court Confirms Plavix Patent Despite Evergreening Charges

Apotex Inc. v. Sanofi-Synthelabo Canada Inc., 2008 SCC 61 (Canada Supreme Court 2008)

The Supreme Court of Canada has upheld Sanofi's "selection patent" (the '875 patent) covering the blockbuster anti-clotting drug Plavix. A broader "genus" patent (the '777 patent) – also held by Sanofi – discloses over 250,000 different compounds. The narrower patent does have some additional patent scope. In particular, while '875 patent claims a particular dextro-rotatory isomer, the prior '777 patent only describes a racemate of that compound that includes two different isomers.

As an apparent "evergreening" strategy, Sanofi did not claim priority to its earlier patent filing. This allows for an additional decade of patent term. Looking at the case, the Supreme Court determined that it should simply follow the law of novelty and obviousness and not create any special 'evergreening' exception:

[97] Evergreening is a legitimate concern and, depending on the circumstances, strategies that attempt to extend the time limit of exclusivity of a patent may be contrary to the objectives of the Patent Act. The Act aims to promote inventiveness by conferring exclusivity for a limited period of time while providing for public disclosure of the invention to enable others to make or use it after expiry of the period of exclusivity. [98] However, a generalized concern about evergreening is not a justification for an attack on the doctrine of selection patents for two reasons. First, a selection patent may be sought by a party other than the inventor or owner of the original genus patent. In such a case, anticipation or obviousness may be an issue, but evergreening does not arise.

On obviousness, the court found "a significant difference" between the claimed patent and the prior genus patent, and that the "difference was not obvious."

• Thanks to Professor Jeremy de Beer for sending the case.

Junk Patents

In 2007, Haliburton filed for patent protection – claiming a method of "patent acquisition and assertion by a (non-inventor) first party against a second party." It looks like the company wants to be able to sue non-inventing entities who try to patent and assert technology against a company who has been using the technology as a trade secret. Bilski wipes cleanly out the claims – except for those claiming the step of "performing research using a computer." The inventor Clive D. Menezes is a Halliburton patent attorney. The prosecuting attorney is Howard Speight.

Obligation to point out the inventor and invention dates of each claim not commonly owned

In a recent first office action rejection, the examiner wrote the following:

"This application currently names joint inventors. In considering patentability of the claims under 35 U.S.C. 103(a), the examiner presumes that the subject matter of the various claims was commonly owned at the time any inventions covered therein were made absent any evidence to the contrary. Applicant is advised of the obligation under 37 C.F.R. 1.56 to point out the inventor and invention dates of each claim that was not commonly owned at the time a later invention was made in order for the examiner to consider the applicability of 35 U.S.C. 103(c) and potential 35 U.S.C. 102(e), (f) or (g) prior art under 35 U.S.C. 103(a).

I'm confused by this examiner statement. (Otherwise, this particular office action is exceptionally well written). What I don't understand is the "obligation." After receiving this (or even before) are the patent applicants under a duty to describe the ownership structure and invention dates?

Federal Government’s Contracting Quota for Small (Racially) Disadvantaged Businesses Found Unconstitutional

Rothe Development Corp. v. Department of Defense (Fed. Cir. 2008)

Although not a patent case, Rothe raises an important Federal Constitutional issue. In Rothe, the Federal Circuit has held that the statutory quota for governmental contracts with "small disadvantaged business" is facially unconstitutional as a race-based violation of the right to equal protection (through the Due Process Clause of the Fifth Amendment).

10 U.S.C. § 2323 ("Section 1207") sets a goal that "five percent of federal defense contracting dollars" be awarded to small businesses owned and controlled by "socially and economically disadvantaged individuals." Under the Small Business Act, Black Americans, Asian Americans, Hispanic Americans, and Native Americans are presumptively socially disadvantaged individuals.

Statutes that that include explicit racial classifications are reviewed with "strict scrutiny." Such provisions are only valid if they "serve a compelling governmental interest, and [are] narrowly tailored to further that interest." In the race setting, general efforts "to alleviate the effects of societal discrimination" are not considered compelling interests under the Supreme Court's 1996 Shaw decision. Congress reauthorized Section 1207 in 2006. Thus, to be constitutional, the evidence of a compelling governmental interest at that time.

On appeal, the Federal Circuit found that older Congressional evidence (from the original enactment of the provision) was "stale" by 2006 and thus not reliable. Additionally, the record did not reflect that newer evidence was officially considered by Congress.

Although we are mindful that Congress has broad discretion to regulate its internal proceedings, we are hesitant to conclude that the mere mention of a statistical study in a speech on the floor of the House of Representatives or the Senate is sufficient to put the study "before Congress" for purposes of Congress' obligation to amass a "strong basis in evidence" for race-conscious action.

Finally, the Federal Circuit found that the newer studies – even if considered by Congress – were inadequate because of the many methodology defects.

Upon these findings, the Federal Circuit held that congress did not have a compelling governmental interest in enacting Section 1207 and that the statute therefore is invalid as unconstitutional.

Note:

• Opinion written by Chief Judge Michel and joined by Circuit Judge Mayer and District Court Judge Stearns from Massachusetts sitting by designation. These judges were appointed by Presidents Reagan, Reagan, and Clinton, resptively.

    

BPAI Appointments Clause Argument Waived

In re DBC (Fed. Cir. 2008) (

The primary issue in DBC began with Professor Duffy's 2007 administrative law article in the Patently-O Patent L.J. In that article, Duffy noted a constitutional problem with the appointment of BPAI judges. Notably, the 1999 statute required that BPAI judges be appointed by the PTO Director while constitution requires such 'inferior officers' be appointed by either the President or a 'Head of Department' such as the Secretary of Commerce. Later, I found that the vast majority of recent BPAI decision included at least one illegally appointed judge (using Duffy's standard). [LINK] Following these findings, Congress passed an amendment placing the appointment duty in the hands of the Secretary of Commerce. The Bill – now signed into law – includes a retroactive saving clause that would bless prior improperly appointed judges as properly acting as "de facto officer[s]" [Link] The retroactive savings clause is, however, considered constitutionally suspect.

During reexamination, the patentee (DBC) lost its BPAI appeal. At the Federal Circuit, the DBC argued that the BPAI decision should be vacated because two of the three BPAI panel members were 'illegally appointed.' Citing Duffy's Patently-O article, Judge Linn noted the potential appointment problems. However, rather than addressing the issue directly, the Federal Circuit dismissed DBC's argument as waived because the patent applicant had failed to raise the issue before the BPAI panel itself.

If DBC had timely raised this issue before the Board, the Board could have evaluated and corrected the alleged constitutional infirmity by providing DBC with a panel of administrative patent judges appointed by the Secretary. Of course, the Board may not have corrected the problem, or even acknowledged that the problem existed. But in that case, DBC would have preserved its right to appeal the issue.

In exceptional circumstances, the Federal Circuit will consider previously waived arguments. Here, however, the court declined its discretion to do so: "We do not view the circumstances of this case to warrant such an exceptional measure."

Although this case focuses on the particular appointments clause issue, its discussion of waiver may be especially important for those preparing BPAI arguments.

DBC's patent focuses on uses of the mangosteen fruit – apparently one of the ugliest and most delicious fruits around. In the appeal the Federal Circuit also found (1) a substantial question of patentability had been raised [this has become a very low bar] and (2) that the patent claims were properly found obvious based on the prior art despite evidence of commercial success.

Applying Bilski to Biotechnology and the Life Sciences

By Professor Christopher M. Holman (University of Missouri at Kansas City School of Law and author of Holman's Biotech IP Blog)

The Bilski majority characterizes its machine-transformation test as "the governing test for determining patent eligibility of a process under section 101." Under this test, a claim is patent-eligible if (and as applied in Bilski apparently only if): (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing." As explained by the Court, the test serves as a proxy for assessing the more fundamental concern – ensuring that the claim does not seek to impermissibly "preempt the use of a fundamental principle." This might make sense in the context of so-called business method patents, where the fundamental principle implicated is typically characterized as an abstract idea or mental process. But it is unclear to what extent this test will prove applicable to patent claims arising out of the life sciences, where patentable subject matter challenges more often allege preemption of a natural phenomena or law of nature, rather than an abstract idea or mental process.

For example, although Bilski states that a process claim is "surely" patent-eligible under section 101 if it complies with the machine-transformation test, this cannot be literally correct with respect to a naturally occurring biological process. Photosynthesis transforms carbon dioxide and water into sugar, and in Bilski the Court specifically points to chemical reactions as the sort of physical transformation that will render a process patentable, but a claim directed to photosynthesis would clearly violate Supreme Court precedent which bars the patenting of natural phenomena.

Bilski acknowledge that the machine-transformation test might require refinement or augmentation in the future, and I think this refinement will likely be necessary when the court addresses patentable subject matter challenges based on allegations that a patent claim preempts a biological natural phenomenon. Three such cases are currently on appeal to the Federal Circuit – Ariad v. Lilly, Classen v. Biogen, and Prometheus v. Mayo. Nevertheless, since for the time being the machine-transformation test is apparently the governing test, it is worth considering how the claims at issue in these case, and some other controversial biotechnology patent claims, might fare under this approach.

Ariad's claims essentially recite methods of altering the activity of a regulatory protein (NF-kB) in a cell, which would seem to satisfy the transformation prong of the test. This outcome would be consistent with the District Court's determination that the claims comply with section 101, albeit for an entirely different reason. But Lilly argues (reasonably I think) that the claims wholly preempt the use of a natural biological phenomenon, and since Bilski acknowledges that the machine-transformation test is really just a proxy for weeding out patent claims that preempt "fundamental principles," this argument might prevail even though the claim does recite a physical transformation.

The claims at issue in Classen, on the other hand, are directed to methods for determining an optimal immunization schedule based on comparing the observed incidence of immune-mediated disorders in treatment groups subjected to different vaccination schedules. Determining an immunization schedule does not appear to satisfy either prong of the machine-transformation test. The claims do include an additional step of immunizing patients, but under Bilski this step would likely be classified as "insignificant extra-solution activity." For example, the majority particularly points to data collection steps as insufficient to render patentable a claim that is essentially directed to a process of analyzing the data. Notably, the majority strongly suggests that the inclusion of a data-gathering step in the claim at issue in LabCorp v. Metabolite is insufficient to confer patentability on that claim, the essence of which is directed to the non-tranformative step of observing a correlation between homocysteine and vitamin B levels in a body fluid. In this regard, Bilksi appears to be consistent with the approach suggested by Justice Breyer in his dissent from the Supreme Court's decision not to decide LabCorp.

Similarly, the claims at issue in Prometheus essentially target observing the level of a drug metabolite in a patient, and based on that observation recognizing that an adjustment in dosage may be required. The claims recite the administration of the drug to a patient and determining the level of metabolite in the patient's body, but under Bilski these might well be treated as an insignificant extra solution data-gathering steps, analogous to the assay step in the claim challenged in LabCorp. If we disregard these steps, the claims would appear to fail machine-transformation test.

Note that at the core, the reason the claims in Prometheus and Classen might fail the machine-transformation test has little to do with any underlying natural phenomenon, but rather because they preempt an abstract idea/mental process without tying that process to a specific machine or apparatus. In contrast, the challenge to Ariad's claims is fundamentally different, being based on preemption of a natural phenomenon rather than preemption of an abstract idea that could be implemented mentally without the use of a machine. In my view, the machine-transformation test just does not work for claims such as Ariad's.

Some of the most controversial biotechnology patents are so-called human gene patents, particularly those relating to genetic diagnostic testing. For example, Myriad has been widely criticized for its perceived aggressive enforcement of patents relating to the BRCA breast cancer genes. Some of these patents broadly claim methods of identifying mutations, with no apparent extra-solution step that transforms a particular article or is tied to a particular machine or apparatus. For example, U.S. Patent No. 5,753,441 claims a "method for screening germline of a human subject for an alteration of a BRCA1 gene which comprises comparing germline sequence of a BRCA1 gene . . . with germline sequences of wild-type BRCA1 gene . . ., wherein a difference in the sequence of the BRCA1 gene . . . of the subject from wild-type indicates an alteration in the BRCA1 gene in said subject.

Similarly, U.S. Patent No. 6,432,644 claims "a method for diagnosing the presence of a polymorphism in human KCNE1 . . . wherein said method is performed by means which identify the presence of said polymorphism . . .."

Arguably, these sorts of claims are merely directed to "comparing" naturally occurring genetic sequences, or "diagnosing" the presence of natural mutations, and lack the significant extra-solution step necessary for patent-eligibility under Bilski.

Finally, note that Bilski in effect treats the patentable subject matter doctrine as a mechanism for policing claim scope, a role more commonly associated with the enablement and written description requirements. For example, the majority points to its earlier decision in Abele as an example where a broad claim is invalid for encompassing patent-ineligible subject matter, but an appropriately narrowed dependent claim complies with Section 101. Similarly, genetic diagnostic testing claims might be fine if limited to a specific test or tests, but patent-ineligible if drafted so broadly as to effectively encompass any method for observing a genetic variation.

Gardner: Patent Bar Should Use Its High Priced Skills to Overcome Bilski et al.

In my last post on Bilski, I added my Comiskey 'fear factor' to Paul Gardner's analysis of post-Bilski claim strategies. In response, Mr. Gardner first notes that the Comiskey language I quoted is "dicta, supported only by arguably inapposite precedent, and presumably uninformed by any discourse in the briefing." Beyond that, however, Gardner explains that the Patent Bar should stand-up and explain to the PTO and courts that "the application of novel and nonobvious software to otherwise computer hardware is neither 'routine' nor 'typical.'"

Paul Gardner: The verbiage in Comiskey from which you opine in the September 20, 2007 issue of Patently O that "Comiskey could be read to indicate that any portion of an invention that constitutes nonstatutory subject matter will be considered de facto obvious" is dicta, supported only by arguably inapposite precedent (n. 16 in Comiskey), and presumably uninformed by any discourse in the briefing (given the fact that the court remanded the case to the Patent Office for ruling on the Section 103 issue). Moreover, the opinion says only that "[t]he routine addition of modern electronics to an otherwise unpatentable invention typically creates a prima facie case of obviousness." (Emphasis added.) I can't help but wonder whether such gratuitous, patent-negative dicta is in large part the unintended but predictable consequence of the patent bar too often capitulating to rejections rather than aggressively asserting their clients' rights to protection (caused, perhaps, by clients' limited funding of patent prosecution). By "aggressively asserting," I mean arguing forcefully in a given case that the application of novel and nonobvious software to otherwise conventional computer hardware is neither "routine" nor "typical," and that labeling it "routine" or "typical" at the front end is to prejudge the 103 issue and forestall reasoned analysis. I submit that a compelling argument can and should be made that the application of nonobvious software to conventional hardware renders the combination patentable, in much the same way that purification of a naturally-occurring substance renders the purified substance patentable if its therapeutic value is nonobvious. The discovery of the therapeutic value of the naturally-occurring substance makes the purified substance nonobvious notwithstanding the fact that the purification process itself is old and well known. It seems to me that the same logic applies to nonobvious software implemented by old and well known hardware. One of the two questions you posed last Friday was whether skilled patent attorneys will be able to alter their claim strategies to fit within Bilski's pronouncements. I believe that it is more important than ever for the patent bar to use their high priced skills to argue against the kind of short-sighted rejections that are coming out of the Patent Office and being affirmed by the courts. The balance has clearly shifted against inventors and patentees in recent years, and only the skills of the advocate can move the balance back to the appropriate position. Please understand that I do not take issue with your statement that "Comiskey could be read to indicate that any portion of an invention that constitutes nonstatutory subject matter will be considered de facto obvious." My concern is that, left without countervailing exposition, such commentary may discourage the patent bar from advocating the contrary.

I have posted a reprint of my Patently-O post from the first Tuesday of November, 2004. There were no comments added to that original post

Chicago still uses punch-cards for voting. Despite the risk of hanging chads or dimpled marks, the benefit of this system is the paper trail. Many voters, including myself, are reassured by the paper trail. Patent No. 4,445,731 (shown above) was invented by John Ahmann in the early 1980's. The patent covers the type of portable voting booths used in my precinct. Ahmann is still recognized as an expert in voting technology and testified in the Bush v. Gore controversy of 2000. According to the BBC, about 30% of U.S. voters will use electronic voting (e-voting) machines in today's election. *2008 NOTE – that number is up to 32% for 2008*

Problems and praise Opponents highlight the problems that have already occurred with the machines - pointing for instance to a congressional race in Ohio in which votes were incorrectly registered due to a problem with the memory cartridges. At the same time however, Georgia's entirely electronic system appears to have few naysayers after two years in operation - although it is widely believed that the [2004] presidential election will prove the greatest test. The principal criticism remains the lack of paper audit trails. Nevada is the only state using machines that provide voters with the kind of receipt which would, if necessary, allow for a manual recount. But in order to accommodate some of the concerns, a number of states - including California - will give voters the opportunity to vote using electronic machines or a paper ballot form.

Here is a picture of my neighbor and senate hopeful Barack Obama and his daughter casting his vote.

Bilski: Adding Obvious but Meaningful Limitations

Paul Gardner is PRG's Academic Director. In an e-mail, I asked him whether claim drafting techniques and strategies can be effectively tailored to satisfy Bilski's requirements without sacrificing valuable claim scope. Mr. Gardner says yes it can be done most of the time (and PRG is developing the CLE to tell you how). For Gardner, an important consideration in Bilski is between "meaningful limits" versus "nonobvious limits."

While Bilski requires that process claims recite machine or transformation limitations that "impose meaningful limits on the claim's scope," such limitations need not themselves be new or nonobvious. In other words, "meaningful limits" is not to be equated with "nonobvious limits," and the "meaningful limits" requirement may be satisfied – insofar as Section 101 patent-eligibility is concerned – by machine or transformation limitations which, standing alone, are old or obvious. Once Section 101 patent-eligibility is found to be present, novelty and nonobviousness of the claim as a whole may be satisfied by a novel and nonobvious algorithm in combination with the structural machine or transformation recitations.

This difference is seen in the Federal Circuit's discussion of Abele.

As Chief Judge Michel points out in Bilski, in Abele the CCPA found a broad method claim reciting only data manipulation steps (calculating the difference between two values and displaying the value of the difference) to be patent-ineligible, but found a dependent claim adding only that the data is "X-ray attenuation data produced in a two dimensional field by a computed tomography scanner" to be patent-eligible, because the data represented physical and tangible objects.

My own caution comes from the CAFC's nonobviousness analysis in the 2007 Comiskey decision. In describing that case, I led with the headline "35 USC 101 Finds its Teeth (Biting into Nonobviousness)" because Comiskey could be read to indicate that any portion of an invention that constitutes nonstatutory subject matter will be considered de facto obvious. Under this reading of Comiskey, obvious but meaningful limitations may overcome §101, but leave the claim extremely vulnerable under §103(a). The Supreme Court's 1978 Parker v. Flook decision follows this same line of thinking – treating a non-statutory (but previously unknown) algorithm "as though it were a familiar part of the prior art."

   

     

     

   

Written Description: Single Embodiment Insufficient

This decision is nothing new. Broad claims must either be supported by multiple embodiments or some general principles describing how the single embodiment is applicable to other configurations. Failing that, a broad claim may fail the enablement prong. As seen here, even when enabled, a broad claim without sufficient support will be invalid under the written description requirement.

In re Alonso (Fed. Cir. 2008)

The PTO Board of Appeals (BPAI) rejected claim 92 of Kenneth Alonso's for failing the written description requirement of Section 112. "To satisfy this requirement, the specification must describe the invention in sufficient detail so that one skilled in the art can clearly conclude that the inventor invented the claimed invention as of the filing date sought." (quoting case). In an opinion written by Judge Stearns (D.M.A.) sitting by designation, the Federal Circuit affirmed.

Claim 92 of the Alonso patent application claims a "method of treating neurofibrosarcoma in a human by administering an effective amount" of an idiotypic monoclonal antibody (mAb) secreted in a human-human cell hybridoma.

In his application, Alonso only described the preparation of a single mAb, but claimed essentially all Mab's that bind to neurofibrosarcoma, and the PTO found that a "skilled artisan would reasonably conclude that applicant was clearly not in possession of the claimed genus of compounds. Applicant should direct the claim language toward the only described embodiment (e.g., a mAb produced by hybridoma HB983)."

Standard of Review: The PTO's factual determinations are reviewed for "substantial evidence." Thus, the Federal Circuit will affirm when "a reasonable mind might accept [the evidence] as adequate to support a conclusion." Even if the Federal Circuit might ultimately have seen the facts differently, it will affirm if the PTO's position is reasonable.

Predictability: The Federal Circuit acknowledged that disclosure of a single embodiment can be sufficient for a broader genus claim. However, more disclosure is necessary when the composition and effectiveness of members of the genus is heterogeneous or unpredictable.

We have previously held in a similar context that "a patentee of a biotechnological invention cannot necessarily claim a genus after only describing a limited number of species because there may be unpredictability in the results obtained from species other than those specifically enumerated." Noelle v. Lederman, 355 F.3d 1343, 1350 (Fed. Cir. 2004).

Alonso argued that his single embodiment should be given more weight because he had actually reduced it to practice (unlike the Rochester COX-2 case). The Federal Circuit rejected that argument because Alonso had not provided the necessary predictive information – "nothing about the structure, epitope characterization, binding affinity, specificity, or pharmacological properties common to the large family of antibodies implicated by the method."

Notes:

• The court gives the following justification for the written description requirement: "The requirement 'serves a teaching function, as a quid pro quo in which the public is given meaningful disclosure in exchange for being excluded from practicing the invention for a limited period of time.'" quoting Univ. of Rochester, 358 F.3d 916 (Fed. Cir. 2004) (in turn quoting Enzo Biochem, 323 F.3d 956 (Fed. Cir. 2002)).
• In his 2005 book on Electronic and Software Patents, Steve Lundberg, et al. include the understatement: "The purpose of the written description requirement has been in flux recently."

Professor Collins: In re Bilski: Tangibility Gone “Meta”

By Professor Kevin Emerson Collins (Indiana University Law School – Bloomington) [PDF Version]

In its recently issued en banc majority opinion in In re Bilski, the Federal Circuit articulates a "machine-or-transformation" test for patent-eligible subject matter under § 101 of the Patent Act. Although they are both legitimate questions, this short comment addresses neither whether there is a legitimate statutory basis for this test nor whether Supreme Court precedent should be interpreted so as to mandate (or even support) this test. Rather, it focuses solely on the criteria that the court offers to draw the line between patentable and unpatentable transformations. The Federal Circuit has added a new twist to the tangibility test that has for many years played a role in determining patent-eligibility: the tangibility test has gone "meta." The tangibility of the formal data that is actually transformed by a method of processing information is not relevant to patent-eligibility, but the tangibility of the things that the data is about—the tangibility of the informational content of the data or the things to which the data refers—now appears to be dispositive.

Bilski sets out a disjunctive two-prong "machine-or-transformation" test for patent-eligible subject matter: "A claimed process is surely patent-eligible subject matter under § 101 if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing." Slip op. at 10. The opinion declines to elaborate on the implications of the particular-machine prong of the test because the applicants conceded that their claim did not satisfy this prong. Id. at 24. It addresses only the transformation prong. It puts forward a conjunctive, two-prong test that must be satisfied for a method to "transform[] a particular article into a different state or thing" and thus to qualify as patent-eligible subject matter. First, the transformation implicated "must be central to the purpose of the claimed process." Id. In other words, it must also "impose meaningful limits on the claim's scope" and not "be insignificant extra-solution activity." Id. Second, the transformation only qualifies as patent-eligible if it transforms a certain type of "article." "[T]he main aspect of the transformation test that requires clarification here is what sorts of things constitute 'articles' such that their transformation is sufficient to impart patent-eligibility under § 101." Id. at 24–25. This is the distinction—the distinction between the "articles" that, if transformed, constitute patent-eligible subject matter and the other "articles" that, if transformed, do not constitute patent-eligible subject matter—on which the opinion elaborates at length, id. at 25–32, and on which this comment focuses.

Most importantly for the point addressed here, the Federal Circuit implies in Bilski that there are two different categories of "electronically-manipulated data," id. at 25, and that the data in each category is a different type of "article" insofar as patent-eligibility is concerned. The data in the first category is an "article" that, if transformed by a method claim, constitutes patent-eligible subject matter, but a method that transforms the data in the second category is not a patent-eligible method.

The first category is comprised of data that represents a "physical object or substance." Id. at 28. For example, citing In re Abele, 684 F.2d 902 (C.C.P.A. 1982), the Federal Circuit stated that a method that transforms data that "clearly represent[s] the physical and tangible objects, namely the structure of bones, organs, and other body tissues" is a patent-eligible method. Slip. op. at 26.

The second category of data seems to have two distinct subsets. The first subset is data that, as claimed, does not represent anything (or, alternatively, that can represent anything). This data is semantically empty; it is a variable without any specified informational content. Bilski again uses Abele—but this time the claims that the court rejected under § 101—as an example. Id. The fact that methods reciting the transformation of this meaningless (or infinitely meaningful) data are not patent-eligible should come as no surprise to those familiar with the history of patent-eligibility in the last several decades: methods that recite the manipulation of variables without semantic meaning are nothing more than methods that recite mathematical algorithms in the abstract.

The second subset of the second category, however, is likely to raise some eyebrows: it contains data that represents something specific or something in particular, but that something represented is itself intangible. Here, the informational content of the data—the thing in the world to which the data refers—is intangible. The Federal Circuit holds that the method at issue in Bilski is not patent-eligible because it "transform[s]" or "manipulat[es]" data representing "public or private legal obligations or relationships, business risks, or other such abstractions," which critically is not data "representative of physical objects or substances." Id. at 28.

The idea that the meaning that the user attributes to the data transformed or manipulated by an information processing method is relevant to patent-eligibility is not a novel feature of the "machine-or-transformation" test announced in Bilski. For example, the "concrete, useful and tangible result" test of State Street Bank required the courts to examine the meaning of the data, variables or "numbers" in the course of determining patent-eligibility. State St. Bank & Trust Co. v. Signature Fin. Group, 149 F.3d 1368, 1373–75 (Fed. Cir. 1998). However, what is new in Bilski is the importance now placed on the physicality of the thing to which the data refers. Thus, the tangibility test has gone "meta": it is no longer the tangibility of jostling electrons that is of concern (as it was in the early days of patents on computer-executed information processing methods), but the tangibility of the stuff represented by those electrons-as-symbols. In the language of semiotics, the tangibility analysis has shifted from a concern about the tangibility of the signifier—the physical configuration of matter that forms a symbol—to a concern about the tangibility of the signified—the informational content of or the thing represented by the symbol.

There is in my opinion much that needs to be said about this move in Bilski that takes the long-standing concern about tangibility in the patent-eligibility analysis "meta," transforming it from a concern about a signifier to a concern about a signified. Here, however, I limit myself to raising two initial, narrow questions.

First, the move raises a normative question: Why should we treat information about tangible things in a manner that is categorically different from the manner in which we treat information about intangible things? Having taken its cue from the Supreme Court, the Federal Circuit clearly wants to prevent patent-eligible method claims from pre-empting mathematical "fundamental principles." Slip op. at 26. However, the most appropriate means to achieve this end would seem to be a focus on the specificity, not the intangibility, of what is meant. Why should the manipulation of data that represents my height (a presumptively physical property of my body) be patentable, yet the manipulation of data that represents my expected longevity (a property that is difficult to classify as a physical one) be unpatentable?

Second, the move raises concerns about administrability. Is data about my expected longevity about something physical, namely my body? If it is, then why isn't the data at issue in Bilski also about something tangible? The data is after all about a property of lumps of coal, namely their expected future rate of consumption or the legal rights that individuals have with respect to them. Or, to formulate the administrability problem in a recursive manner, what about data that is about the structural qualities of electronic signals? To determine whether a method that manipulates such data is patent-eligible, it would seem again to be necessary to confront the tangibility of an electronic signal—the very question that patent doctrine has been trying to render irrelevant for several decades—but this time with the signal as a signified rather than as a signifier.

Patently-O Bits and Bytes

• Media Partner & Symposium CLE: TechInsights is hosting a series of Intellectual Property Symposiums beginning December 2 and 4 in Chicago and Dallas respectively. The focus of the one-day symposium is on the "needs of the electronics community." http://ips.techinsightsevents.com/. Use code IPSPYO for $359 registration special (or just ask for the "Patently-O Discount.")
• Quote of the week: Ellen P. Apill "The consequences of the [Bilski] decision will depend on how PTO examiners understand and apply the test to the patent applications they review."
• Fish & Richardson on Bilski: Business method inventions "might be or might not be patentable." [Link]
• Bilski Process: In Bilski, the Federal Circuit took sua sponte action to hear the case en banc even before a three-member panel considered the issues. This process seems to have worked well here.
• Google Patents: I have been having an e-mail conversation with a patent librarian. Our conclusion is that Google Patents is useful for quick searching, but folks should be aware that it is not totally accurate and is missing some patents and publications.
• Recent Patent Law Jobs:
  • Patent Counsel - Small Corporation - Menlo Park, Calif.
  • Patent Attorney - Law Firm - Chicago, Ill.
  • Sponsored: Senior ANDA Litigator
  • Paralegal - Law Firm - Madison, Wisc.
  • Senior Patent Attorney - Small Corporation - Bellevue, Wash.
  • Patent Agent - Law Firm - Chicago, Ill.
  • Patent Attorney - Large Corporation - Madison, N.J.
  • Patent Litigation Associate - Law Firm - Chicago, Ill.
  • Patent Attorney - Small Corporation - Rochester, N.Y.
  • Patently-O Jobs

CLE: How to Draft Software Claims under Bilski

In Bilski, the Federal Circuit laid down the law of subject matter eligibility under Section 101 of the Patent Act. To be patent eligible, a claimed process must either: (1) be tied to a particular machine or apparatus, or (2) transform a particular article into a different state or thing. In all likelihood, claim limitations focused at general machines such as a "computer" will not be considered tying to "particular machine." Bilski did not, however, decide that question – Bilski's claims were admittedly divorced from any particular machine. On the transformation side, the court provided the example from Abele where graphically displaying "X-ray attenuation data produced in a two dimensional field by a computed tomography scanner" was sufficient transformation. Bilski's claims were essentially knocked-out on the new mental steps doctrine – a process where all the claimed steps "may be performed entirely in the human mind is obviously not tied to any machine and does not transform any article into a different state or thing."

Two additional points: Although the Federal Circuits points to the machine-or-transformation test as the sole test for Section 101 patentability, the court approved two ‘corollaries.’  First, field-of-use limitations continue to be “generally insufficient to render an otherwise ineligible process claim patent-eligible.” Second, "insignificant postsolution activity will not transform an unpatentable principle into a patentable process." (quoting Diehr).  Thus, merely reciting a specific machine or particular transformation will not bring a claim into the realm of patentable subject matter unless the recitation is more than mere insignificant postolution or extra-solution activity.

Going forward, I do not believe that these limitations will have a significant impact on a skilled practitioner's ability to patent software innovations. However, I would like community input on how you might properly claim computer software in a way that avoids § 101 rejections?