Section 292 (False marking): PATracer reports on a district court decision in favor of Target — holding that the retailer is not liable for false marking even if it knowinly sold products that were falsely marked. [LINK]
Divided Infringement: PATracer also reports on an interesting non-infringement decision in favor of DirecTV based on the company’s outsourcing of customer support operations. “DirecTV can not be liable for direct infringement of an asserted claim if the evidence demonstrates that DirecTV neither performs by itself nor directs nor controls a third party’s performance of any one element of the claim.” [LINK]
Section 292 (False marking): PATracer reports on a district court decision in favor of Target — holding that the retailer is not liable for false marking even if it knowinly sold products that were falsely marked. [LINK]
Divided Infringement: PATracer also reports on an interesting non-infringement decision in favor of DirecTV based on the company’s outsourcing of customer support operations. “DirecTV can not be liable for direct infringement of an asserted claim if the evidence demonstrates that DirecTV neither performs by itself nor directs nor controls a third party’s performance of any one element of the claim.” [LINK]
The recently distributed form (Titled a Request for Recalculation of Patent Term Adjustment in view of Wyeth) is exceedingly simple and requires only basic information regarding the patent and a signature. The applicant is not even required to indicate a belief that additional patent term is due. Forms are due on a rolling basis – always within 180-days of patent issuance. Thus, form should be immediately submitted for patents issued in early August, 2009.
Although PTA calculation is somewhat complex, the Wyeth change only impacts patents that meet the following criteria: (1) application actually filed on or after May 29, 2000 and (2) prosecution pendency of greater than three years. The vast majority of impacted cases will also include (3) a file history showing that the PTO delayed in examining the application during the first three years of pendency. The most likely PTO delay is that the Office waited more than 14-months before providing an initial examination response such as an office action rejection; restriction; or notice of allowance. Although only an educated guess, I suspect that the median additional term will be a bit under 1-year.
In Wyeth v. Kappos, the Federal Circuit held that the USPTO has been miscalculating the Patent Term Adjustment (PTA) owed to patentees due to delays in patent prosecution. The USPTO has now announced an interim procedure for requesting recalculation of patent term. According to the plan, the PTO will recalculate the patent term for free for any patent issued prior to March 2, 2010 so long as the request for reconsideration is submitted within 180 days of issue. (Patents Issued on August 4, 2009 will reach the 180 day mark on Sunday, January 31, 2010.) The requested recalculation may only be for the purpose of correcting the overlap-calculation discussed in Wyeth.
[T]he USPTO will be processing recalculation requests under an interim procedure that is available to a patentee whose patent issues prior to March 2, 2010, and who requests it no later than 180 days after the issue date. This procedure is available only for alleged errors in calculation that are specifically identified in Wyeth. A copy of the notice submitted to the Federal Register for publication and the form for patentees to use in requesting a recalculation of patent term is on the USPTO Web site at /media/docs/2010/01/pta_wyeth.pdf.
The USPTO created March 2, 2010 as a deadline because it expects to be correctly calculating PTA by that point. “The agency expects to complete by March 2, 2010, the software modification necessary to comply with the U.S. Court of Appeals for the Federal Circuit’s recent decision in Wyeth v. Kappos regarding the overlapping delay provision of 35 USC 154(b)(2)(A).” If my undertanding is correct, the PTO intends to continue to issue patents with the incorrect PTA calculation up until that point.
Although it would be wise to double-check the PTO’s calculations, the applicant is not required to make the calculation prior to requesting reconsideration. Rather, according to the PTO, “the request for reconsideration need only state that reconsideration is being requested in view of the Federal Circuit’s decision in Wyeth.”
Potential Statutory Violation: Although I applaud the USPTO’s patentee friendly approach I am not convinced that the PTO has the power to take this action. Notably, 35 USC 154(b)(3)(B)(ii) requires that the PTO “provide the applicant one opportunity to request reconsideration.” The subsequent procedure identified by statute is a civil action that must be filed in court within 180 days of the grant of the patent. For patents that have already issued, the PTO has already offered the one opportunity to request reconsideration (see 37 CFR 1.705) and this waiver of the rules is providing a second opportunity for reconsideration. The court that limited the PTO’s power in Tafas v. Dudas could also limit the agency’s power in this situation. Even if the PTO is acting unlawfully, a patent receiving additional patent term due to the unlawful behavior will still likely be valid and enforceable under Aristocrat.
Potential Loss of Right to a Civil Action: Applicants should also beware that the 180–day-from-issuance deadline for filing a civil action to correct the PTA has not been waived. This means that the applicant may have no recourse if the PTO’s recalculation decision arrives after that 180–day window.
Almost 20,000 patent practitioners have subscribed to the free daily Patently-O e-mail. Each night, the e-mail software (FeedBurner) collects the most recent blog posts and sends them out to the e-mail list. Some folks like the daily e-mail because it allows them to more easily distribute the most pertinent Patently-O posts to their colleagues and clients. Others prefer the e-mail because it is easier to read on a handheld device and because it helps avoid spending time checking the website for updates and comments.
Privacy: I’m the only one who has access to the e-mail list and I won’t sell it (although I may e-mail you personally if I have a particular question about your practice). I believe that it takes two-clicks to unsubscribe.
Sign-up here. (Once you sign-up, you will receive an e-mail with a link that must be followed in order to confirm the subscription.)
Therasense, Inc. (Abbott) v. Becton, Dickinson and Co. (Fed. Cir. 2010) (Case No. 2009-1511)
This detailed 67–page opinion includes several important issues. This post focuses on inequtiable conduct. The Federal Circuit recently released a parallel decision involving the same parties (but different patent) here.
After a bench trial, Northern District of California Judge Alsup held Abbott’s patent unenforceable due to inequitable conduct during prosecution. (Patent No. 5,820,551). On appeal, the Federal Circuit has affirmed that decision — holding that the prosecuting attorneys had violated their duty of disclosure by failing to dislcose statements made by Abbott to the European Patent Office during a proceeding involving the European counterpart of another patent family (the ‘382 patent’ family) also owned by Abbott. Although the court affirmed the finding of inequitable conduct, it offered the fig leaf that such a finding should be “rare.” (Note: Therasense originally filed both patent applications and also made the statements to the EPO. That company was subsequently purchased by Abbott.)
Patent applicants (and their attorneys/agents) are required to disclose to the US Patent Office any information that a reasonable examiner would likely consider important in deciding whether to issue a patent. Failing to submit the required information can lead to a finding of inequitable conduct if the information was both (1) material to patentability and (2) witheld because of an intent to deceive the Patent Office. Inequitable conduct usually results in a patent being rendered totally unenforceable. “The penalty for inequitable conduct is severe, as an entire patent is rendered unenforceable.”
During prosecution, the examiner rejected the application based on Abbott’s own ‘382 patent. In response, Abbott’s Director of Research submitted an affidavit attesting that the one skilled in the art would not consider the ‘382 patent to teach the invention as claimed in the ‘551 patent. [The claimed invention was a glucose-memter electrode strip without an intervening membrane layer — with the absense of the membrane being the distinguishing feature.] Based on that representation, the Examiner allowed the patent to issue. Meanwhile, in Europe, Abbott made the statement that the stated distinction was only a “safety measure” and was “preferred” but not necessary. [“It is submitted that this disclosure is unequivocally clear. The protective membrane is optional, however, it is preferred when used on live blood.”]
Based on these facts, the Federal Circuit found the statements material:
To deprive an examiner of the EPO statements—statements directly contrary to Abbott’s representations to the PTO—on the grounds that they were not material would be to eviscerate the duty of disclosure. Moreover, if this could be regarded as a close case, which it is not, we have repeatedly emphasized that the duty of disclosure requires that the material in question be submitted to the examiner rather than withheld by the applicant.
Lawyer Argument Regarding Prior Art: In several cases, the Federal Circuit has held that contradictory representations made during the prosecution of other patent applications should not be considered material to patentability if made in the form of lawyer-argument. See Innogenetics. Here, the appellate panel distinguished those cases because they all involved US applications rather than statements made to different institutions.
However, all of the cases Abbott cites involve patentees who simply made representations to the PTO about prior art in order to secure the allowance of their patents. None of these cases involved a situation in which contradictory arguments made in another forum were withheld from the PTO. They do not speak to the applicant’s obligation to advise the PTO of contrary representations made in another forum. Before the EPO, Abbott made statements that contradicted the representations Abbott made to the PTO regarding the ’382 patent. An applicant’s earlier statements about prior art, especially one’s own prior art, are material to the PTO when those statements directly contradict the applicant’s position regarding that prior art in the PTO. See 37 C.F.R. § 1.56(b)(2). In any event, the representations to the PTO were not merely lawyer argument; they were factual assertions as to the views of those skilled in the art, provided in affidavit form.
Intent: The Federal Circuit agreed that the lower court’s finding of subjective intent was “amply supported.”
Holding:
Because the district court’s findings that the EPO submissions were highly material to the prosecution of the ’551 patent and that Pope and Dr. Sanghera intended to deceive the PTO by withholding those submissions were not clearly erroneous, the district court did not abuse its discretion in holding the ’551 patent unenforceable due to inequitable conduct.
Judge Linn filed a dissenting opinion: Judge Linn argues (1) that there is an explanation for the statements that does not lead to them being directly contradictory and (2) that the individuals involved “produced a good faith explanation as to why they withheld the EPO submissions.” Such a good faith explanation should defeat charges of inequitable conduct if it is plausible.
The question, thus, is not whether it is plausible that the information is immaterial—a question asked under the objective materiality prong—but rather, whether it is plausible that the individuals subjectively believed that the reference was immaterial at the time they withheld it—a question presented under the subjective intent prong.
Recently issued patent number 7,651,688 is not too remarkable. Its three claims cover an “antibody composition” with a particular arrangement of “sugar chains.” The oddity is that the first 10-pages of the patent document are filled with a listing of over 900 references submitted by the applicant in a series of six information disclosure statements. (The examiner included an additional nine references based on her search of the art).
The most common type of reference submitted in this case were documents from the file-histories of other US patent applications owned by the same entity (Kyowa Hakko Kirin Pharma, Inc.). Many of the submitted references are actually from the file-histories of related-cases being examined by the same examiner. See table below:
881. Non-Final OA issued Oct. 17, 2007 in U.S. Appl. No. 10/581,413. 882. 1.111 Amendment filed Apr. 17, 2008 in U.S. Appl. No. 10/581,413. 883. Restriction Requirement issued Jul. 28, 2008 in U.S. Appl. No. 10/581,413. 884. Final OA issued Dec. 11, 2008 in U.S. Appl. No. 10/581,413.
The result here is that the file history includes 13,689 pages of non-patent or foreign prior art. Most of those documents were submitted after the applicant had already received a notice of allowance.
Based on my cursory reading of the file history, I do not see that the prosecuting firm (Sughrue) did anything improper or wrong in this case. To the contrary, based on recent inequitable conduct cases, the patentee is clearly hoping to avoid charges of inequitable conduct based on ‘hiding’ references. Of course, the applicant did not indicate which (or which parts) of the 900+ references are most relevant and everyone is clear that the examiner is not going to read all of the references. As one practitioner wrote to me: “The balance is way off between useful information in an IDS and covering-our-asses in regards to inequitable conduct. Something needs to give.”
I contacted Ken Burchfiel of Sughrue. He provided the following on-point commentary:
Burchfiel: I can’t comment on U.S. Patent 7,651,688, except to commend its excellence, and instead offer more general observations on the infectious doctrine of inequitable conduct in a time of “absolute plague” 22 years after Kingsdown.
In view of the Federal Circuit’s decisions in Dayco Prods., Inc. v. Total Containment, Inc., 329 F.3d 1358 (Fed. Cir. 2003) and McKesson Info. Solutions, Inc. v. Bridge Med., Inc., 487 F.3d 897 (Fed. Cir. 2007), it is prudent to provide an examiner with citations to office actions in copending applications. Until the court or Congress acts to limit the ever-expanding scope of the meandering duty of disclosure, which now encompasses information that may be of marginal significance, reasonable practitioners have little choice but to follow the mandate of the Federal Circuit and identify Office Actions in other applications that could later be found to be material. It may also be prudent to identify relevant foreign applications and office actions in an IDS, in view of Therasense, Inc. v. Becton, Dickinson & Co., No. 2008-1511 (Fed. Cir., Jan. 25, 2010). Although the prosecution history of a foreign application cannot be used to construe patent claims, it may now render them unenforceable. The extent of disclosure required in a given case is, of course, a judgment call that depends on many factors, including the indeterminate “reasonable examiner” standard applied by the Federal Circuit.
The question is not whether information cited in an IDS is helpful to the actual examiner, but rather whether it may later be deemed material to a “reasonable” examiner by a court. While an actual examiner is required to follow the rules of practice, including the 1992 amendments to Rule 56 limiting the scope of “material” information, a “reasonable” examiner is not similarly bound under Digital Control, Inc. v. Charles Mach. Works, 437 F.3d 1309 (Fed. Cir. 2006). It is not possible, as a practical matter, to determine the scope of information that may be later be deemed material to an unreasonable “reasonable” examiner (i.e., one who, unlike actual examiners, is not fettered by the rules of practice).
As the Federal Circuit again emphasized in Therasense, “if this could be regarded as a close case, which it is not, we have repeatedly emphasized that the duty of disclosure requires that the material in question be submitted to the examiner rather than withheld by the applicant. See LNP Eng’g Plastics, Inc. v. Miller Waste Mills, Inc., 275 F.3d 1347, 1361 (Fed. Cir. 2001) (“[W]hen a question of materiality is close, a patent applicant should err on the side of disclosure.”); LaBounty Mfg., Inc. v. U.S. Int’l Trade Comm’n, 958 F.2d 1066, 1076 (Fed. Cir. 1992) (“[A close case] makes it all the more necessary that the [reference] should [be] disclosed to the examiner. Close cases should be resolved by disclosure, not unilaterally by the applicant.”).” Whether or not this be divinest sense, it is nonetheless Therasense.
A patent solicitor’s life has never been an easy one.
Notes:
Claim 1 reads as follows: An antibody composition comprising antibody molecules, wherein 100% of the antibody molecules comprising a Fc region comprising complex N-glycoside-linked sugar chains bound to the Fc region through N-acetylglucosamines of the reducing terminal of the sugar chains do not contain sugar chains with a fucose bound to the N-acetylglucosamines, wherein said antibody molecules bind to CD52.
Therasense, Inc. (Abbott) v. Becton, Dickinson and Co. (Fed. Cir. 2010) (Case No. 2009-1008)
The Abbott patent covers a glucose meter designed with an additional sensor that ensures that a sufficient blood sample is obtained prior to the measurement. (Patent No. 5,628,890). Abbott sued BD and Nova Biomed for infringement. At the close of trial, the jury returned a verdict that the patent was infringed but invalid. The jury indicated that the patent was invalid for “anticipation or obviousness” and also invalid for failing the written description requirement of Section 112.
Law of Anticipation: On appeal, the Federal Circuit first determined that the jury instructions on the law of anticipation were incorrect. Notably, the district court judge had told the jury that “for anticipation, it is sufficient if the single reference would have informed those skilled in the art that all of the claimed elements could have been arranged as in the claimed invention.” (emphasis added). Of course, anticipation requires that the reference disclose the same elements in the same arrangement.
The requirement that the prior art elements themselves be “arranged as in the claim” means that claims cannot be “treated . . . as mere catalogs of separate parts, in disregard of the part-to-part relationships set forth in the claims and that give the claims their meaning.” Quoting Lindemann Maschinenfabrik GMBH v. Am. Hoist & Derrick Co., 730 F.2d 1452, 1459 (Fed. Cir. 1984).
Harmless Error: Under Federal Circuit law, erroneous jury instructions will lead to vacatur unless the error “could not have changed the result.” Here, the jury decided obviousness and anticipation together and the Federal Circuit found that the overwelming evidence of obviousness renders the error on anticipation “harmless.”
“[A]n erroneous instruction on the law of anticipation could not have changed the result in this case if claims 11 and 12 would have been obvious as a matter of law, such that no reasonable jury could have returned a verdict that the claims are not obvious.”
Obvious as a Matter of Law: The appellate panel held here that the asserted claims “would have been obvious over [the Nankai reference] as a matter of law.” The court’s approach to his holding of obviousness will be important for future summary judgment motions. In particular, Abbott’s downfall was its own broad claim language that encompassed the prior art. One clear difference between the claims and the prior art was admitted by the patentee to be “insubstantial.”
Written Description: Because the claims were obvious, the court did not consider the written description appeal.
Cross Appeal: BD filed a cross-appeal in the case asking the court to overturn the holding of infringement. The Federal Circuit rejected that cross-appeal — holding that it lacked jurisdiction. Notably, a cross-appeal is only appropriate when “a party seeks to enlarge its won rights under the judgment or to lessen the rights of its adversary under the judgment.” Here, the cross-appeal was improper because a holding of non-infringement would not change the ultimate outcome of the case.
Note: The Federal Circuit has also decided the related case No. 2008-1511 (Therasense, Inc. v. Becton, Dickinson and Co.). That opinion focuses on obviousness and inequitable conduct.
Appealing Reexaminations: Rob Sterne has published a 25–page report on “Appeals from the Central Reexamination Unit.” For the 15 BPAI decisions in inter-partes reexaminations, Stern reports that only 15 inter partes reexaminations have reached a BPAI decision. Of those, the median case took 26.5 months to brief and an additional 6.2 months for the case to be decided. Sterne’s reexamination center provides regular updates on reexamination issues.
Reexamination Gridlock: Hal Wegner reports: “Gridlock at all levels” of the inter partes reexamination process is “choking inter partes reexamination.”
Stays of Litigation: David Donoghue reports on the N.D. Ill case of of Card Activation Techs. V. Bebe Stores, Inc., No. 09 C 406, Slip Op. (N.D. Ill. Nov. 20, 2009) (Gottschall, J.) (case stayed pending reexamination even though the asserted claims were not those being reexamined)
Reexamining Design Patents: Scott Daniels writes on his reexamination blog about reexamination of design patents. [Link] Of the 12 design patent reexaminations requests, two requests were denied based on no SNQ, two patents have been confirmed as properly issued, the other eight are still pending. Eleven of the twelve requests were submitted by third parties.
Webinar on Reexaminations: Managing IP is offering a free webinar on “Patent Reexamination as a Litigation Strategy” on Feb 24 at 1pm. The talk is led by Novak-Druce attorneys.
Reexamination and Litigations: Joe Mullin reports on his Prior Art blog that 60+ photo-sharing defendants may be off-the-hook based on the cancelling of FotoMedia’s patent claims in reexamination. [Link] I looked up the reexamination (No. 90/010,143) and found that the PTO has issued a final rejection about half of the patented claims.
Crouch on Reexaminations: I’ll be speaking on reexaminations at the IP Law Summit hosted by the marcus evans company at the Doral resort in Miami Florida March 25–27. See you there.
The following excerpt comes from President Obama’s recent townhall meeting in Ohio on Friday, January 22, 2010:
* * * * *
Q I’m an inventor, and I hold U.S. patent number 7,397,731.
THE PRESIDENT: Okay.
Q And before I ask my question I’d like to make a sales pitch. (Laughter.) If you can use my patent in your next election, I think you can raise a ton of money worldwide. You should take a look at it.
THE PRESIDENT: All right, we’ll take a look. All right.
Q If you can’t use it, the government could use it, and I could build a multibillion-dollar business here in Ohio. (Laughter.)
THE PRESIDENT: All right, we’ll take a look at your patent. Go ahead, what’s your question?
Q Yes, okay, it has to do with international patent rights. With all this free trade and trade barriers falling, it’s really hard for an individual like me with a global-scope patent to file all over the world and get patent protection everywhere, and having to go overseas to fight infringement. So if you’re going to drop trade barriers, maybe you can extend my patent rights to the foreign countries.
THE PRESIDENT: Well, this is a great question, and this is a huge problem. (Applause.) Look, our competitive advantage in the world is going to be people like this who are using their minds to create new products, new services. But that only helps us and helps you build a multibillion-dollar company if somebody can’t just steal that idea and suddenly start making it in Indonesia or Malaysia or Bangladesh with very cheap workers.
And one of the problems that we have had is insufficient protection for intellectual property rights. That’s true in China; it’s true for everything from bootleg DVDs to very sophisticated software. And there’s nothing wrong with other people using our technologies. We just want to make sure that it’s licensed and you’re getting paid.
So I’ve given instructions to my trade offices — and we actually highlight this at the highest levels of foreign policy — that these are issues that have to be addressed because that’s part of the reciprocity of making our markets open. And so when I met with President Hu of China, this is a topic that, at dinner, I directly brought up with him. And — but as you point out, it’s got to be sustained, because a lot of times they’ll say, yes, yes, yes, but then there’s no enforcement on their end.
And one of the things that we’re also doing is using our export arm of the U.S. government to help work with medium-sized businesses and small businesses, not just the big multinationals to protect their rights in some of these areas, because we need to boost exports.
Can I just say, we just went through a decade where we were told that it didn’t matter, we’ll just — you just keep on importing, buying stuff from other countries, you just take out a home equity loan and max out your credit card, and everything is going to be okay. And it looked, for a lot of people, like, well, the economy seems to be growing — but it was all built on a house of cards. That’s what we now know. And that’s why if we’re going to have a successful manufacturing sector, we’ve got to have successful exports.
When I went and took this trip to China, and took this trip to Asia, a lot of people said, “Well, why is he going to Asia? He’s traveling overseas too much. He needs to be coming back home and talking about jobs.” I’m there because that’s where we’re going to find those jobs, is by increasing our exports to those countries, the same way they’ve been doing in our country. If we increased our exports — our share of exports by just 1 percent, that would mean hundreds of thousands of jobs here in the United States. Five percent — maybe a million jobs, well-paying jobs. So we’re going to have to pry those markets open. Intellectual property is part of that process.
* * * * *
The invention claimed by the 7,397,731 patent is pretty cool. It is a “perpetual day reminder calendar.”
The patent was prosecuted by the inventors and it is not surprising that the claims are written in some sort of modified Jepson language. Claim 1 reads as follows:
1. A perpetual day reminder calendar for illustrating day, date and month information, including:
a) a set of day indicating plates with day indica; b) a set of month indicating plates with month indica; c) a set of date indicating cubes with date indica; d) a display stand with locating guides in one of three possible configurations, top holding, center holding or bottom holding;
the improvement wherein said day indicating plates and said month indicating plates identically shaped to fit around said date indicating cubes in a manner providing an interlocking of, said plates and cubes and the shielding of unneeded indica allowing only the needed day, date and month indica to be viewed and the interlocking pieces forming a calendar stack having a unique locating interaction feature with said display stand whereby the perpetual day reminder calendar can be easily manipulated for the sequential displaying of day, date and month indica.
Boehringer Ingelheim Int’l v. Barr Labs and Mylan Pharma (Fed. Cir. 2010)
This decision holds a terminal disclaimer cannot be effective if filed after the expiration date of the earlier patent. The decision expands scope of the safe-harbor created by 35 USC 121 against double patenting allegations. Here, the court held that a divisional-of-a-divisional still qualifies for the safe harbor so long as the later-filed applications do not violate the Examiner’s original grouping suggestions.
(Opinion by Judge Linn and Joined by Judge Prost) Boehringer owns several patents listed in the FDA’s Orange Book as covering the drug Mirapex (pramipexole) used to treat symptoms of Parkinson’s disease. Boehringer filed this lawsuit after the defendant generic-drug manufacturers submitted abbreviated new drug applications (ANDAs) to the FDA as part of their efforts to begin making generic versions of the Mirapex.
The Mirapex patent family began with a 1985 patent application. That family has branched-out into more than fifty world-wide patents, including three US patents. Interestingly, the patent that issued from the original application (the “earlier patent”) is not listed in the Orange Book while a later issued patent is listed. By the time of this lawsuit, the Mirapex patents had passed their ordinary 17–year term of enforceability. However, the term of the later issued patent had been extended by over 4–years based on FDA delay under 35 USC 156.
Late-Filed Terminal Disclaimer : Despite their similarity, Boehringer had not filed a terminal disclaimer in the latest-filed US application. On the last day of trial, Boehringer decided to go ahead and file a terminal disclaimer. In spite of that action, the district court still held Boehringer’s asserted patent invalid under the judicially created doctrine of obviousness-type double patenting. In its opinion, the district court rejected the terminal disclaimer as inoperative because it was filed after the original patent had expired.
On appeal, the Federal Circuit agreed that a terminal disclaimer is not effective if filed after the expiration of the earlier patent.
By failing to terminally disclaim a later patent prior to the expiration of an earlier related patent, a patentee enjoys an unjustified advantage—a purported time extension of the right to exclude from the date of the expiration of the earlier patent. The patentee cannot undo this unjustified timewise extension by retroactively disclaiming the term of the later patent because it has already enjoyed rights that it seeks to disclaim.
Safe harbor of Section 121: Section 121 of the Patent Act provides a safe-harbor for family–member patents that issue after a restriction requirement:
A patent issuing on an application with respect to which a requirement for restriction … has been made, or on an application filed as a result of such a requirement, shall not be used as a reference either in the Patent and Trademark Office or in the courts against a divisional application or against the original application or any patent issued on either of them…
On appeal, the Federal Circuit first held that Section 121 can apply to protect “a divisional of a divisional” as in this case. Here, the court agreed that the later application was filed “as a result of” a restriction requirement because the restriction requirement in the original application was the original cause of the multiple US patent filings. The court did indicate that this safe-harbor would have been lost if the later-filed application violated the claim groupings of the restriction requirement.
In a prior decision, the court held that Section 121 applies to protect patents against double patenting rejections. See Geneva Pharms, 349 F.3d 1373, 1378 (Fed. Cir. 2003) (“Section 121 intervenes to prevent a nonstatutory double patenting rejection”).
Thus, because of the protection of Section 121, Boehringer did not need to file a terminal disclaimer.
In dissent, Judge Dyk argued that Section 121 should not apply here because the applicant had not strictly following the groupings in the original restriction requirement. Notably, the original restriction requirement divided the claims into ten groups — each group representing a separate invention while the later application was filed with claims from four of the groups.
The USPTO has announced it will not seek further review of the Wyeth v. Kappos decision. In that case, the Federal Circuit held that the USPTO has been under-calculating the Patent Term Adjustment (PTA) owed to patentees based on USPTO prosecution delays. In its announcement, the USPTO indicated that is “preparing guidance for expediting requests for recalculation of patent term adjustments by the USPTO in light of the Wyeth decision.”
Although I have not completed the calculations, the patents perhaps most-likely to have some additional patent-term due to the Wyeth decision are those whose prosecution history include both (1) a pendency of more than three years from filing until either the patent issues or the applicant files an RCE and (2) a delay of more than 14–months from the application filing to the mailing of the first examination notification.* Prior to Wyeth, the PTO treated the beyond-three-year-issuance delay as overlapping with the the beyond-14–month-notification delay.
In a sample of 674 patents issued in the past year and filed after May 2000, I found that 479 (71%) both (1) had a pendency (smaller of filing-to-RCE and filing-to-Issuance) of greater than three years and also (2) had not received a qualifying notification with 14–months. Although I cannot say this with certainty yet, I believe that most of these newly issued patents deserve additional patent term under the Wyeth decision.
Note :*Notifications that qualify as first examination notifications include a Notice of Allowance, Final or Non-Final Rejection, Restriction Requirement, and an Ex Parte Quayle Action. Pre-examination notices such as a notice of omitted items or notice of incomplete application typically do not satisfy the PTO’s duty of meeting the 14–month deadline.
Invention Submission Corporation v. Gene Quinn & IP Watchdog (N.D.N.Y.)
Plaintiff, “InventHelp” is the most recent DBA name of the Invention Submission Corporation. Defendant, Gene Quinn runs the IPWatchdog.com website and works with the same type of individual-inventor clients as InventHelp. The following two statements are taken directly from the InventHelp website:
From 2003 to 2005, we signed submission agreements with 6,592 clients. As a result of our services, 119 clients have received license agreements for their products, and 15 clients have received more money than they paid us for these services.
From 2006-2008, we signed Submission Agreements with 5,692 clients. As a result of our services, 94 clients have received license agreements for their products, and 21 clients have received more money than they paid us for these services.
During the 2003–2008 time period, fewer than 1 out of 300 InventHelp clients “received more money than they paid [to InventHelp] for these [invention promotion] services.”
For years, Gene Quinn has been writing about InventHelp and arguing that the company is “one of the most notorious of all invention scams.” Now, the company has sued Quinn (and his wife) under the Lanham Act for providing a “misleading representation of fact … in commercial advertising or promotion…”; for defamation (apparently under NY Law?); for trade libel; and for interference with prospective clients.
In an earlier post, I indicated that 40% of appeal briefs are initially rejected as “defective” for failing to comply with the rules of BPAI brief-drafting practice. I pulled-up the file histories for eleven applications whose appeal briefs were rejected in the calendar year 2009. [Table Below] The most common cause for defect in this group occurred when the applicant fails to list previously cancelled claims in the brief. Although that information is included in the appendix of claims, the briefing rules as interpreted by the appeal specialists require that withdrawn/cancelled claims also be identified in the proper section of the body of the brief.
Application Serial Number
Explanation of Defect
9/967,742
Brief did not contain a statement of the status of all claims (e.g., rejected allowed, withdrawn, objected to, cancelled) or does not identify the appealed claims. (The brief did state that “all of the claims have been finally rejected, and the rejections of claims 1-18 and 23-25 is appealed herein.” However, the brief did not state that claims 18-22 were cancelled. Of course, that information was in the appendix of claims.)
10/159,079
Figures of prior art that were pasted into the brief were “unreadable.” (The figures were identified and the prior art was already in the file).
9/983,493
The Brief did not present an argument under a separate heading for each ground of rejection on appeal. (It appears that the problem here is that the applicant underlined the heading for each argument, but did not put the argument in bold.)
10/223,904
The Brief did not contain a reference to a co-pending application also on appeal.
8/873,974
The Brief did not list the cancelled claims. (Of course, that information was in the appendix of claims.)
10/711,517
The Brief did not present an argument under a separate heading for each ground of rejection on appeal. (The argument section did not exactly parallel the grounds-for-rejection section.)
11/484,214
The Brief did not contain a concise statement of each ground of rejection presented for review. (The applicant was appealing one rejection and stated the ground of rejection being reviewed was “Whether the claims fail to comply with the written description requirement under U.S.C. § 112, first paragraph.” The revised and accepted brief instead asked “Whether claims 1-13 fail to comply with the written description requirement under U.S.C. § 112, first paragraph.” Of course, the original brief also stated that “Claims 1-13 are pending. Thus, claims 1-13 are being appealed.”)
10/660,659
The Brief mis-cited the prior art at one point using the wrong patent number.
10/277,646
The Brief indicated that claim 23 was “cancelled,” but the applicant had not actually filed an amendment to cancel the claim.
10/914,894
The Brief did not list all claims and their status, including those withdrawn. (The amended brief added the information that claims 24-42 had been previously cancelled. Of course, that information was also available in the claim appendix.)
10/804,237
The Brief did not list the cancelled claims although that information was available in the claim appendix.
Two recent expanded-panel BPAI decisions both consider the situation where a patent applicant presents arguments in a reply brief even though the arguments could have been raised by in the principal brief. Interpreting the regulations of 37 CFR 41, both decisions hold that the Board is not required “to consider such belated arguments” unless the applicant presents “good cause” for the delay in presentation.
“[W]e take this opportunity to explain that the regulations governing Appeals to the Board require that any argument not timely presented in the principal Brief, will not be considered when filed in a Reply Brief, absent a showing of good cause explaining why the argument could not have been presented in the Principal Brief.” Nakashima.
Rule 41 does not discuss the potential content of a reply brief other than to note that the reply brief “shall not include any new or non-admitted amendment, or any new or non-admitted affidavit or other evidence. 37 C.F.R. § 41.41(a)(2) (2007). Prior to 1998, Rule 41 required that reply brief content focus only on points newly raised in an examiner’s answer. That limitation, however was eliminated in the 1998 rule modifications. Despite this change, the BPAI panels both held that the “scope of the reply brief was never expanded to include belated arguments or new arguments unaccompanied by a showing of good cause.”
No New Nuances: A no-new-arguments rule is a common rule in all types of court systems. However, the rule as implemented in Nakashima appears that it could be better stated as no-new-nuances. Nakashima argued in its principal brief that the examiner’s obviousness rejection was incorrect. The “new” argument presented in the reply brief still focused on obviousness and the same two references, but provided a new justification for a non-obviousness conclusion. In particular, Nakashima’s opening brief argued (1) that the examiner’s suggested combination of prior art teachings would “destroy” the functionality of the claimed vacuum apparatus and (2) that the examiner was incorrect in his assertion that one of the references taught a “inner belt.” The reply brief added the nuance that there is “no reason to combine” the two prior art references because the result would not have been desirable. According to the Board, the “no reason to combine” argument was new and therefore, the Board refused to address that issue.
Writing in dissent in Nakashima, Administrative Patent Judge Terry Owens argued that the patent applicant had a right to include new arguments in its reply brief. Owens quotes the PTO’s comments associated with the 1998 rule change found in 62 Fed. Reg. 53168: “The former practice of permitting reply briefs based solely on a finding of a new point of argument [in the examiner answer] is eliminated thereby preventing present controversies as to whether a new point of argument has been made by the primary examiner.”
Notes:
On remand and after filing an RCE, Nakashima should be able to argue its new points to the examiner and perhaps reach the Board again in three-years.
The Nakashima application is owned by Brother (Japan) and is being prosecuted by the Oliff & Berridge firm (DC).
The Borden application is owned by Sharp (US) and is being prosecuted by the Chernoff firm (Oregon).
In the newest Patently-O Patent Law Journal article published today, Gregory Landis and Loria Yeadon discuss the role of ethnic diversity in the process of choosing upcoming nominees for the Court of Appeals for the Federal Circuit. The authors suggest that diversity should play a role in the judicial selection and that diversity likely will play such a role.
Read Gregory P. Landis & Loria B. Yeadon, Selecting the Next Nominee for the Federal Circuit: Patently Obvious to Consider Diversity, 2010 Patently-O Patent L.J. 1 (2010) here: [Nominee Diversity]
The Patently-O Patent Law Journal publishes short, timely essays on patent law focused topics. The published essays are typically fewer than 2000 words. Feel free to submit essays to me: dcrouch@patentlyo.com.
In a recent e-mail to PTO employees, Director Kappos explained a real problem associated with PTO funding for the next year — that 1.9 billion dollars will not be enough for FY2010. Although that seems like a lot of money, the PTO’s technology infrastructure is in dire need of an overhaul and the agency needs to hire additional examiners to reduce the current backlog of over one million pending applications. It appears likely that the PTO will collect over two billion dollars in user fees for FY2010, but the current funding rules would force the agency remit any amount over $1.887 billion to the US Treasury.
To recap, the PTO is (1) entirely funded by by user fees and (2) has significant financial needs to address shortfalls in serving its users. In this situation, the agency should at least be authorized to spend the fees that it collects.
== Kappos Letter ==
Dear Team:
I wanted to share my thoughts with you about a topic of great import to the USPTO and its mission. As you’ve read in the press, we have been engaged in ongoing discussions with members of Congress and their staff regarding our budget for the current fiscal year, which began on October 1, 2009. In addition, we have been providing technical assistance to Congress in connection with patent reform legislation, which is geared toward placing the USPTO on a sustainable funding model.
Innovation is the engine of our economy, and an efficient USPTO facilitates the timely delivery of innovative goods and services to market. What we do here at the USPTO is therefore of paramount importance to economic recovery and job creation.
As you know, the USPTO has been struggling in the last year to put itself on solid financial footing. Declines in fee revenue during the recession have adversely impacted our budget – and as a consequence forced us to make hard choices – including halting virtually all hiring, limiting overtime, and postponing critical repairs to our information technology infrastructure.
As part of the annual appropriations process, our financial team was asked to provide Congress with projected fee income for the 2010 fiscal year. This information was provided in September based on the data available at that time, when agency collections were at their low point. Congress used that projection of $1.887 billion in setting our budget for the 2010 fiscal year. That budget forces us to maintain operations on a bare-bones basis, but provides insufficient resources for us to replace employees who leave the agency, improve infrastructure or continue some of the improvements we have started to implement.
In addition, in the last two years, Congress had provided the USPTO a buffer of $100 million above our appropriation, which we were authorized to retain and spend to the extent fee income exceeded our appropriation (up to the $100 million buffer amount). That provision was removed from our fiscal year 2010 appropriation, due (we have been advised) to changes in Congressional Budget Office accounting which made it more difficult for our appropriators to provide the $100 million buffer this year.
The good news is that fee collections have begun to increase, and our current FY10 projections are more than $100 million above the $1.887 billion appropriations amount. We are actively working with Congress and the Administration to find ways to retain funds in excess of the $1.887 billion spending cap so that we can begin to backfill departing employees, improve our infrastructure, and continue to implement reforms.
But let me be clear about this: Hiring large numbers of people is not the silver-bullet solution to our problems, and we intend to hire conservatively and smartly. Most of you are aware that we have launched many reforms since I came on board last August, and we are now aggressively implementing them and looking for new ways to be more efficient on a constant basis. However, there is simply no way to get the backlog under control in a reasonable period of time without significant hiring given current attrition rates. You can run the numbers yourselves using the Patent Pendency Model and I would encourage you to do that.
Our infrastructure needs are also dire – so dire that President Obama referenced the USPTO’s antiquated IT systems in his remarks last week on modernizing government. We must improve those systems to become an efficient 21st century agency – and to be able to effectively serve the innovation community and the American economy.
It is therefore imperative that we work with Congress to develop long-term financial solutions that will establish a sustainable budget for USPTO over multiple years. Providing the USPTO with fee-setting authority as included in the pending patent reform legislation would be part of that plan. But, for the current year, we have immediate and urgent funding needs that require short-term assistance.
For your reference, I’ve attached a copy of the letter I sent to the relevant Congressional committee members on January 4, 2010.
Addressing our financial challenges so that the Agency can function effectively is my highest priority. I remain dedicated to working with our stakeholders, the Department of Commerce and members of Congress to ensure that we are able to perform our mission properly in the short-term – and to develop and adopt a sustainable funding model that will allow us to serve this country’s innovators in the future.
I want to thank you for your hard work and dedication during this challenging period for the agency. I very much look forward to hearing any thoughts you might have on this matter. Please share any comments via the Director’s Blog. I will be sure to keep you posted on any significant new developments with respect to our budget.
The BPAI reports that their average pendency of ex parte appeals decided in the 1st Quarter of FY2010 (Oct-Dec 2009) jumped to 9.9 months from 7.7 months for the prior three month period. [Link] BPAI Chief Judge Michael Fleming recently reported that the average pendency is likely to rise significantly in the coming year because of the large and growing backlog of cases on appeal.
The BPAI has done an increasingly good job of providing information directly to the public. However, this pendency data is highly misleading for a patent applicant considering the question of whether to appeal. In particular, the BPAI figures are measured from the “appeal number assignment dates” which occur at some point after briefing is complete and therefore do not include time associated with briefing.
To provide a bit more details regarding pendency, I created a dataset of 2770 ex parte BPAI decisions decided in the past two-years (2008–2009) and their assocated file wrappers. Using this dataset, I looked at appeal pendency as calculated from the filing of a notice appeal to the BPAI decision date. A summary of the results follow.
Results:
Median appeal pendency: 23.9 months (Notice of Appeal to BPAI Decision Date).
Median pendency of application at time of BPAI decision: 67 months (Application Filing Date to BPAI Decision Date). I.e., the median case where an appeal has been decided had been pending for 5 1/2 years before the
Median pendency of application family at time of BPAI decision: 79 months (Earliest Priority Date to BPAI Decision Date).
Defective Briefs: 40% of the decided cases included at least one applicant brief that was rejected as defective.
There are three charts below: The first shows the Cumulative Frequency of Ex Parte Appeal Pendency. This first chart is useful in considering the odds that a particular appeal would take fewer than X-months. The second chart shows the median pendency grouped by technology center. The third chart shows the percent of decided appeals that include at least one notice of a defective appeal brief for each technology center.
Looking Forward: As implied by the first paragraph of this report, these figures likely understate the expected pendency for any recently filed appeal.
Notes:
This report did not consider (1) remands without opinion; (2) decisions that were not published on the BPAI website; or (3) the fact that most notices of appeal filed by applicants do not actually result in a complete appeal process (because the examiner withdraws the rejection or the applicant decides to abandon the application or file an RCE).
In a prior post, I discussed the BPAI’s recent precedential decision of Ex parte Tanaka (BPAI 2009). In that case, Board held that a patentee’s failure to add an additional dependent claim (without cancelling the broader claims) was not the type of “error” that is correctable via reissue. Tanaka had wanted to add the aditional claim as a hedge against the potential that the broader claims were found invalid.
Oblon’s Chico Gholz e-mailed me with a likely caveat to this decision based on his 2008 IP Today article. In that article he suggests that is should be proper in a reissue to merely add an additional narrower claim if the purpose is to provoke an interference. [Link]
Section 292 (False marking): PATracer reports on a district court decision in favor of Target — holding that the retailer is not liable for false marking even if it knowinly sold products that were falsely marked. [LINK]
Section 292 (False marking): PATracer reports on a district court decision in favor of Target — holding that the retailer is not liable for false marking even if it knowinly sold products that were falsely marked. [
I can’t comment on U.S. Patent 7,651,688, except to commend its excellence, and instead offer more general observations on the infectious doctrine of inequitable conduct in a time of “absolute plague” 22 years after Kingsdown. 
Therasense, Inc. (Abbott) v. Becton, Dickinson and Co. (Fed. Cir. 2010) (
Rob Sterne has published a 25–page report on “
Invention Submission Corporation v. Gene Quinn & IP Watchdog (N.D.N.Y.)
