September 2011

Patently-O Bits & Bytes by Lawrence Higgins

Bits and Bytes, Patent,

Opening of Franklin Pierce Center for IP

  • UNH Law is proud to announce the official opening on September 30 & October 1 of the Franklin Pierce Center for Intellectual Property with an intellectual property works-in-progress conference featuring presentations by scholars from law schools in the Northeast and alumni of UNH Law. Chief Judge Randall Rader will serve as special guest speaker. Other guest include: Jonathan Dudas, Judge Newman, and Judge Gajarsa. [Link]

Biotech in Ottawa is Booming?

  • Ottawa Life Science Cluster currently home to over 90 companies focused on life science and biotechnology research and innovation. Also, there are over 50 other companies that have a secondary focus in life sciences and biotechnology. Leading the charge for commercialization is the Ottawa Centre for Research and Innovation (OCRI). With the increased commercialization in Ottawa, comes an increase in patent applications in Canada, the US, and beyond. [Link] [Link]

Great Patents!

  • Great Patents: Advanced Strategies For Innovative Growth Companies, is a book that aims to inform executives on how best to use patents to improve their competitiveness. The book has a total of 12 chapters and each chapter is written by an individual in the patent world. The chapters in the book are broken into two categories: Strategies and Valuation. Companies pursue patents to make money, and this book is very useful to help companies discover what they can do with their patents that they may not have previously considered. While the book is aimed at executives and the like, it is also a useful tool for law students and others. Most law students are not familiar with the business world of patents and this book gives a perspective different than what is taught in law schools.
    • About the Author: David Orange is a patent attorney in Washington, DC. He is active in the start-up space as an investor and advisor.

Patent Jobs

  • Goldberg Cohen is seeking an IP associate with 2-5 years of experience. [Link]
  • Womble Carlyle Sandridge & Rice is looking for mechanical patent attorneys with at least 3 years of experience. [Link]
  • Verenium is searching for a patent agent with a minimum of 5 years of experience. [Link]
  • Cleveland Golf/ Srixon is seeking a Sr. patent engineer with a BSME and at least 4 years of experience. [Link]
  • The Michaud-Kinney Group is looking for a legal assistant to work at their Middletown, Connecticut location. [Link]
  • Qualcomm is searching for a US patent attorney or a registered India Patent Attorney/Agent with at least 5 years of experience. [Link]
  • Qualcomm is looking for a patent counsel with 3+ years of patent prosecution experience. [Link]
  • Steptoe & Johnson is seeking associates with a minimum of 4 years of experience in patent litigation and with a technical background. [Link]
  • The Office of the Solicitor at the USPTO is searching for an experienced Patent Attorney. [Link]
  • Dynamics Inc. is seeking a patent attorney with an EE degree, to work at their Pittsburgh location. [Link]

Upcoming Events:

  • Boston University School of Law and the Kauffman Foundation will be holding a Workshop on Innovation and Patent Harmonization at Boston University School of Management on September 30-October 1. The workshop will cover the effect of harmonization in both advanced countries, such as the US, and in developing nations, with a particular focus on China. Anyone interested in attending, please RSVP to Elizabeth Aggot at eaa@bu.edu. [Link]
  • American Conference Institute's 12th Annual Maximizing Pharmaceutical Patent Life Cycles will take place in New York on October 4th-5th. The conference is one of the leading sources of information and analysis on the patent life cycle management. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • Houston Intellectual Property Law Association (HIPLA) will be holding its Annual IP Institute in Galveston, Texas October 6-8. The Institute will feature topics such as: Do's and Don'ts in IP Licensing, Due Diligence and Ethics in Acquisitions, Patent Prosecution Under the New Cases and Inducement of Patent Infringement after Global Tech Appliances v. SEB. The guest speaker will be Lord Justice Robert "Robin" Jacob, Court of Appeal of England and Wales. [Link]
  • The 17th Annual Advanced ALI-ABA Course of Study for the Corporate Counsel and the Private Practitioner: Trial of a Patent Case will be held in Chicago October 13-14. Guest speakers include: Judge James Holderman, Judge Liam O'Grady, Scott Coonan, James Leeds, and many more individuals. (Patently-O readers can get 30% off with discount code CT017POB) [Link]
  • The 4th Annual Inland Empire Intellectual Property Institute (IEPI) will be held in Spokane, Washington on October 14th. The program will cover: developments in patent prosecution, patent litigation, copyright and trademark; ethical considerations for IP attorneys; patent reform and its impact on the practicing attorney, and many more topics. Guest speakers include: David Powers, Nancy Kim, Shirley Anderson and many other individuals. [Link]
  • American Conference Institute will be holding a FDA Boot Camp Device Edition conference on October 25th-October 26th in Chicago. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • Licensing Executives Society (LES) will be holding their annual meeting on October 16-19 at the Manchester Grand Hyatt in San Diego. Guest speakers include, Martha Ries, VP of IP Management, The Boeing Company and Barbara Dalton VP, Venture Capital, Pfizer. [Link]
  • The University of Texas at Austin will hold its 16th Annual Advanced Patent Law Institute on October 27-28. The program will cover: recent developments in claims construction and claims drafting, cost savings in litigation, inequitable conduct after Therasense, and many other topics. [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

Patently-O Bits & Bytes by Lawrence Higgins

Bits and Bytes, Patent,

Opening of Franklin Pierce Center for IP

  • UNH Law is proud to announce the official opening on September 30 & October 1 of the Franklin Pierce Center for Intellectual Property with an intellectual property works-in-progress conference featuring presentations by scholars from law schools in the Northeast and alumni of UNH Law. Chief Judge Randall Rader will serve as special guest speaker. Other guest include: Jonathan Dudas, Judge Newman, and Judge Gajarsa. [Link]

Biotech in Ottawa is Booming?

  • Ottawa Life Science Cluster currently home to over 90 companies focused on life science and biotechnology research and innovation. Also, there are over 50 other companies that have a secondary focus in life sciences and biotechnology. Leading the charge for commercialization is the Ottawa Centre for Research and Innovation (OCRI). With the increased commercialization in Ottawa, comes an increase in patent applications in Canada, the US, and beyond. [Link] [Link]

Great Patents!

  • Great Patents: Advanced Strategies For Innovative Growth Companies, is a book that aims to inform executives on how best to use patents to improve their competitiveness. The book has a total of 12 chapters and each chapter is written by an individual in the patent world. The chapters in the book are broken into two categories: Strategies and Valuation. Companies pursue patents to make money, and this book is very useful to help companies discover what they can do with their patents that they may not have previously considered. While the book is aimed at executives and the like, it is also a useful tool for law students and others. Most law students are not familiar with the business world of patents and this book gives a perspective different than what is taught in law schools.
    • About the Author: David Orange is a patent attorney in Washington, DC. He is active in the start-up space as an investor and advisor.

Patent Jobs

  • Goldberg Cohen is seeking an IP associate with 2-5 years of experience. [Link]
  • Womble Carlyle Sandridge & Rice is looking for mechanical patent attorneys with at least 3 years of experience. [Link]
  • Verenium is searching for a patent agent with a minimum of 5 years of experience. [Link]
  • Cleveland Golf/ Srixon is seeking a Sr. patent engineer with a BSME and at least 4 years of experience. [Link]
  • The Michaud-Kinney Group is looking for a legal assistant to work at their Middletown, Connecticut location. [Link]
  • Qualcomm is searching for a US patent attorney or a registered India Patent Attorney/Agent with at least 5 years of experience. [Link]
  • Qualcomm is looking for a patent counsel with 3+ years of patent prosecution experience. [Link]
  • Steptoe & Johnson is seeking associates with a minimum of 4 years of experience in patent litigation and with a technical background. [Link]
  • The Office of the Solicitor at the USPTO is searching for an experienced Patent Attorney. [Link]
  • Dynamics Inc. is seeking a patent attorney with an EE degree, to work at their Pittsburgh location. [Link]

Upcoming Events:

  • Boston University School of Law and the Kauffman Foundation will be holding a Workshop on Innovation and Patent Harmonization at Boston University School of Management on September 30-October 1. The workshop will cover the effect of harmonization in both advanced countries, such as the US, and in developing nations, with a particular focus on China. Anyone interested in attending, please RSVP to Elizabeth Aggot at eaa@bu.edu. [Link]
  • American Conference Institute's 12th Annual Maximizing Pharmaceutical Patent Life Cycles will take place in New York on October 4th-5th. The conference is one of the leading sources of information and analysis on the patent life cycle management. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • Houston Intellectual Property Law Association (HIPLA) will be holding its Annual IP Institute in Galveston, Texas October 6-8. The Institute will feature topics such as: Do's and Don'ts in IP Licensing, Due Diligence and Ethics in Acquisitions, Patent Prosecution Under the New Cases and Inducement of Patent Infringement after Global Tech Appliances v. SEB. The guest speaker will be Lord Justice Robert "Robin" Jacob, Court of Appeal of England and Wales. [Link]
  • The 17th Annual Advanced ALI-ABA Course of Study for the Corporate Counsel and the Private Practitioner: Trial of a Patent Case will be held in Chicago October 13-14. Guest speakers include: Judge James Holderman, Judge Liam O'Grady, Scott Coonan, James Leeds, and many more individuals. (Patently-O readers can get 30% off with discount code CT017POB) [Link]
  • The 4th Annual Inland Empire Intellectual Property Institute (IEPI) will be held in Spokane, Washington on October 14th. The program will cover: developments in patent prosecution, patent litigation, copyright and trademark; ethical considerations for IP attorneys; patent reform and its impact on the practicing attorney, and many more topics. Guest speakers include: David Powers, Nancy Kim, Shirley Anderson and many other individuals. [Link]
  • American Conference Institute will be holding a FDA Boot Camp Device Edition conference on October 25th-October 26th in Chicago. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • Licensing Executives Society (LES) will be holding their annual meeting on October 16-19 at the Manchester Grand Hyatt in San Diego. Guest speakers include, Martha Ries, VP of IP Management, The Boeing Company and Barbara Dalton VP, Venture Capital, Pfizer. [Link]
  • The University of Texas at Austin will hold its 16th Annual Advanced Patent Law Institute on October 27-28. The program will cover: recent developments in claims construction and claims drafting, cost savings in litigation, inequitable conduct after Therasense, and many other topics. [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

Patently-O Bits & Bytes by Lawrence Higgins

Bits and Bytes,

Opening of Franklin Pierce Center for IP

  • UNH Law is proud to announce the official opening on September 30 & October 1 of the Franklin Pierce Center for Intellectual Property with an intellectual property works-in-progress conference featuring presentations by scholars from law schools in the Northeast and alumni of UNH Law. Chief Judge Randall Rader will serve as special guest speaker. Other guest include: Jonathan Dudas, Judge Newman, and Judge Gajarsa. [Link]

Biotech in Ottawa is Booming?

  • Ottawa Life Science Cluster currently home to over 90 companies focused on life science and biotechnology research and innovation. Also, there are over 50 other companies that have a secondary focus in life sciences and biotechnology. Leading the charge for commercialization is the Ottawa Centre for Research and Innovation (OCRI). With the increased commercialization in Ottawa, comes an increase in patent applications in Canada, the US, and beyond. [Link] [Link]

Great Patents!

  • Great Patents: Advanced Strategies For Innovative Growth Companies, is a book that aims to inform executives on how best to use patents to improve their competitiveness. The book has a total of 12 chapters and each chapter is written by an individual in the patent world. The chapters in the book are broken into two categories: Strategies and Valuation. Companies pursue patents to make money, and this book is very useful to help companies discover what they can do with their patents that they may not have previously considered. While the book is aimed at executives and the like, it is also a useful tool for law students and others. Most law students are not familiar with the business world of patents and this book gives a perspective different than what is taught in law schools.
    • About the Author: David Orange is a patent attorney in Washington, DC. He is active in the start-up space as an investor and advisor.

Patent Jobs

  • Goldberg Cohen is seeking an IP associate with 2-5 years of experience. [Link]
  • Womble Carlyle Sandridge & Rice is looking for mechanical patent attorneys with at least 3 years of experience. [Link]
  • Verenium is searching for a patent agent with a minimum of 5 years of experience. [Link]
  • Cleveland Golf/ Srixon is seeking a Sr. patent engineer with a BSME and at least 4 years of experience. [Link]
  • The Michaud-Kinney Group is looking for a legal assistant to work at their Middletown, Connecticut location. [Link]
  • Qualcomm is searching for a US patent attorney or a registered India Patent Attorney/Agent with at least 5 years of experience. [Link]
  • Qualcomm is looking for a patent counsel with 3+ years of patent prosecution experience. [Link]
  • Steptoe & Johnson is seeking associates with a minimum of 4 years of experience in patent litigation and with a technical background. [Link]
  • The Office of the Solicitor at the USPTO is searching for an experienced Patent Attorney. [Link]
  • Dynamics Inc. is seeking a patent attorney with an EE degree, to work at their Pittsburgh location. [Link]

Upcoming Events:

  • Boston University School of Law and the Kauffman Foundation will be holding a Workshop on Innovation and Patent Harmonization at Boston University School of Management on September 30-October 1. The workshop will cover the effect of harmonization in both advanced countries, such as the US, and in developing nations, with a particular focus on China. Anyone interested in attending, please RSVP to Elizabeth Aggot at eaa@bu.edu. [Link]
  • American Conference Institute's 12th Annual Maximizing Pharmaceutical Patent Life Cycles will take place in New York on October 4th-5th. The conference is one of the leading sources of information and analysis on the patent life cycle management. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • C5 will be holding the 21st annual Forum on Biotech Patenting in London on October 5th-6th. The 2011 London Biotech Patenting Forum will focus on the latest legal developments affecting biotech companies and how to implement successful methods and strategies for drafting and filing patent applications in multiple jurisdictions. (Patently-O readers can save 100 pounds by using discount code PO 100) [Link]
  • Houston Intellectual Property Law Association (HIPLA) will be holding its Annual IP Institute in Galveston, Texas October 6-8. The Institute will feature topics such as: Do's and Don'ts in IP Licensing, Due Diligence and Ethics in Acquisitions, Patent Prosecution Under the New Cases and Inducement of Patent Infringement after Global Tech Appliances v. SEB. The guest speaker will be Lord Justice Robert "Robin" Jacob, Court of Appeal of England and Wales. [Link]
  • The 17th Annual Advanced ALI-ABA Course of Study for the Corporate Counsel and the Private Practitioner: Trial of a Patent Case will be held in Chicago October 13-14. Guest speakers include: Judge James Holderman, Judge Liam O'Grady, Scott Coonan, James Leeds, and many more individuals. (Patently-O readers can get 30% off with discount code CT017POB) [Link]
  • The 4th Annual Inland Empire Intellectual Property Institute (IEPI) will be held in Spokane, Washington on October 14th. The program will cover: developments in patent prosecution, patent litigation, copyright and trademark; ethical considerations for IP attorneys; patent reform and its impact on the practicing attorney, and many more topics. Guest speakers include: David Powers, Nancy Kim, Shirley Anderson and many other individuals. [Link]
  • American Conference Institute will be holding a FDA Boot Camp Device Edition conference on October 25th-October 26th in Chicago. (Patently-O readers can register with code PO 200 for a discount) [Link]
  • Licensing Executives Society (LES) will be holding their annual meeting on October 16-19 at the Manchester Grand Hyatt in San Diego. Guest speakers include, Martha Ries, VP of IP Management, The Boeing Company and Barbara Dalton VP, Venture Capital, Pfizer. [Link]
  • The University of Texas at Austin will hold its 16th Annual Advanced Patent Law Institute on October 27-28. The program will cover: recent developments in claims construction and claims drafting, cost savings in litigation, inequitable conduct after Therasense, and many other topics. [Link]
  • IPMI is holding the IP Law & Management Institute on November 6th – 8th at the Rancho Las Palmas in Palm Springs, CA. Hailed as "One of the few programs geared to experienced in-house IP Counsel", the Institute is a CLE-accredited program designed to provide time-starved Heads of IP with the Opportunity to meet and network with their peers, learn from the best practices and validate solutions and services. [Link]

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

A Response to Professor Chiang

Guest Post, Patent, Patent Legislation

By Jason Rantanen

Professor Tun-Jen Chiang's post on best mode (below) argues that Congress must necessarily have intended that patent applicants would not disclose best mode, given that it was aware of the potential consequences of removing litigation enforcement.  Thus, Professor Chiang concludes, Congress not only abolished best mode, but then went about "lying" about it.  I have serious doubts about this conclusion.

Despite being styled as a reply to Professor Sheppard's description of Congressional thought about best mode, Professor Chiang misses the fundamental point of Professor Sheppard's post: that although Congress recognized that removing the litigation mechanism for enforcing best mode might result in reduced compliance, there remained alternative mechanisms – which Professor Sheppard discussed – for encouraging applicants to comply with the best mode requirement.

While I personally question the efficacy of the alternate mechanisms for enforcement – which rely primarily on criminal sanctions that, historically at least, have been rarely employed even to deal with more significant misconduct – it is clear that Congress has a higher view of these types of enforcement mechanisms than I do, especially given its treatment of inequitable conduct in the America Invents Act.  Thus, I find it difficult to accept Professor Chiang's dichotomy that either Congress must have been "dumb" or "lying," as well as his analogy to a child with matches.  This issue is far more complex than such an oversimplification allows, and it is entirely reasonable (and probably far more accurate) to recognize that Congress was attempting to balance a difficult issue: the costs of patent litigation versus the need or desire for disclosure of best mode, and elected to proceed by relying on alternative enforcement mechanisms that, while perhaps less often enforced, might potentially provide equal deterrence through more severe sanctions.  If one must use an analogy, it is more similar to giving a teenager a car, explaining that speeding might result in a criminal penalty, while nevertheless providing reassurance that you will not take away the car if he or she is caught speeding, than it is to a child with matches.

Guest Post on Best Mode by Tun-Jen Chiang

Best Mode, Guest Post, Patent, Patent Legislation

Was Congress dumb, or was it lying?–A reply to Professor Sheppard

Guest Post by Tun-Jen Chiang, Assistant Professor of Law, George Mason University School of Law

Imagine a parent who gives his child a box of matches, and tells the child not to play with the matches. The parent then assures the child that, if he does play with the matches, there will be no punishment whatsoever, and nobody will be watching him for the next hour.

Unsurprisingly, the child plays with the matches and burns the house down. When the insurance company denies the claim because of intentional arson, the parent screams: “but I told him not to play with the matches!” In this circumstance, the charitable inference is that the parent had a charmingly naïve view about the obedience of his child. The uncharitable inference is that the parent knew the child would play with the matches, and the admonition not to play with them was insincere “cover.”

What does this have to do with best mode? In her post, Professor Sheppard assures us that Congress knew precisely the consequences that would occur. Although she protests that her post was only descriptive and not a defense of the law, one cannot help but sense from her “vehement” disagreement with the critics an implication that those who think Congress didn’t know what it was doing are being unfair in some way (When someone says "You can say X is wrong. I agree X is wrong. But don't say X is dumb.", there is an implication that saying X is dumb is unfair). But the critics are not being unfair; they are being charitable.

With Professor Sheppard's assurance that Congress knew the consequences, the unavoidable conclusion is that Congress intends the probable consequence that patentees would not disclose the best mode. The reason for maintaining a best mode requirement on paper now seems to be to provide political cover to scream “but we told them to disclose the best mode!” whenever the critics talk about lax disclosure requirements. This is much worse than either abolishing best mode outright or keeping best mode with no enforcement on the misguided faith that patentees would still comply — it is Congress abolishing best mode and then lying about it.

The Federal Circuit’s Rare Opportunity to Protect the Public from Agency Misconduct

BPAI, Guest Post, Patent, , , ,

Guest Post by Richard B. Belzer, Ph.D.

The Federal Circuit has before it an unusual petition for rehearing en banc. It involves an issue that, to my knowledge, has never before been heard by this court, and it's one that hardly anyone who practices patent law even knows about. Indeed, the reason that this issue is arising now is the U.S. Patent and Trademark Office has made an extraordinary (and heretofore successful) effort to prevent inventors and the patent bar from understanding it.

For this reason, my nonprofit organization has filed an amicus brief asking the Court to uphold statutory rights that, until recently, possibly no patent lawyer knew how to defend. If the Court acts favorably, it can undo decades of rogue agency practice at the PTO.

In In re Lovin, the key issue is whether an examiner's failure to state a prima facie case of obviousness, as required by MPEP Chapter 2100, is sufficient ground for the Board of Patent Appeals and Interferences to vacate or reverse a rejection. Lovin's brief alleges that the Board abandoned its longstanding practice of vacating rejections when the examiner had not made this case, and instead required the appellant to make a substantive showing of patentability in their appeal brief—that is, to prove a negative. The amicus brief of CFPH, LLC, a business unit of Cantor Fitzgerald, offered a complementary explanation of why the Board's interpretation of PTO Rule 41.37 was incorrect.

Regulatory Checkbook, the nonprofit I manage, seeks leave to intervene because the PTO lacked any legal authority to compel Lovin to provide this information. In fact, until December 22, 2009, the PTO had no legal authority to require any appellant to comply with any of the material information collections contained in 37 C.F.R. Part 41.

How could that be? To understand why, let's take a short trip to the Office of Management and Budget, which occupies the tall red brick building across Lafayette Park from the tall red brick building housing the Court of Appeals for the Federal Circuit.

(more…)

Construing Claim Constructions

Claim Construction, Patent, Patent Cases 2011, ,

By Jason Rantanen

Cordis Corporation v. Boston Scientific Corporation (Fed. Cir. 2011) Download 10-1311 -1316-1
Panel: Bryson, Mayer, and Gajarsa (author)

Stent
Cordis v. BSC turns on an interpretation of a construction of the claim term "undulating."  In this case, Cordis obtained a jury verdict of infringement of Patent No. 5,879,370 against Boston Scientific Corporation.  Prior to trial, the district court construed the term "undulating" to mean "rising and falling in waves, thus having at least a crest and a trough."  Slip Op. at 11.  After Cordis obtained its favorable verdict, BSC renewed its motion for judgment as a matter of law on noninfringement, arguing that "Cordis inappropriately altered the parties' and the court's understanding of the term 'undulating'," and that under the "intended" construction the evidence presented at trial could not support a conclusion that this claim element was met by the accused product.    Slip Op. at 11.  The district court granted BSC's motion and Cordis appealed.

Construing Constructions: On appeal, the CAFC confirmed the propriety of BSC's argument.  "The question here is whether BSC did, in fact, seek to alter the district court’s claim construction," a construction Cordis did not challenge.  Slip Op. at 12.  It did not.  "No rule of law restricted BSC from seeking to clarify or defend the original scope of its claim construction."  Slip Op. at 12.  However, "because BSC did not object to the court’s jury instruction regarding the construction of the term “undulating,” “[t]he verdict must be tested by the charge actually given [under] the ordinary meaning of the language of the jury instruction,” Hewlett-Packard, 340 F.3d at 1321."  Id.

In deciphering the "ordinary meaning" of the district court's construction, the CAFC first turned to a general purpose dictionary definition of 'waves' to conclude that 'crest' and 'trough,' "as used in the district court's claim construction, implicate changes of direction, with the curve extending beyond the point of inflection."  Slip Op. at 13.  Although Cordis cited expert testimony and dictionary entries of its own, the CAFC was not persuaded.  The CAFC also looked to the prosecution history, which further suggested a construction of "undulating" that meant more than just a single curve. 

Applying this interpretation of the district court's claim construction, the CAFC concluded that Cordis had indeed failed to offer substantial evidence of infringement.

Inequitable conduct: This case was involved in a prior appeal, Cordis Corp. v. Boston Scientific Corp., 188 F. App’x. 984, 985 (Fed. Cir. 2006), in which the CAFC addressed a district court finding of inequitable conduct.  In that appeal, the CAFC affirmed the materiality of the conduct at issue but remanded to the district court for further findings of fact relating to intent.  On remand, the district court reached an alternate conclusion, deciding that, on reflection, the evidence of record failed to support a finding of deceptive intent under a clear and convincing standard.  On appeal, the CAFC affirmed the finding of no inequitable conduct, noting in particular the deference given to district courts on issues of credibility.

***

Interpretations of constructions raise a difficult issue for the Federal Circuit, and have implications for litigation predictability.  While the panel in this case did not directly identify the standard of review it applied to the district court's interpretation of the construction, the analytic structure of the opinion follows the same approach that the CAFC has traditionally employed when construing claims generally: look at the evidence and arrive at its own conclusion, i.e. de novo.  In this instance, the methodology used by the panel seems to harken back to the Texas Digital line of claim construction: start by determining the ordinary meaning of a word using tools such as dictionaries, then look to the intrinsic evidence to see if it compels a different result.  Perhaps this approach may be more defensible in light of the subject being interpreted, but it seems at odds with the principles announced in Phillips.

The interpretation issue in this case also raises a possible red flag against the concept of routine interlocutory review of claim constructions, a proposal frequently offered as reducing litigation costs and enhancing the predictability of litigation.  If a claim construction itself is subject to a subsequent interpretation, are efficiencies truly added by having the CAFC offer an early construction?  There is a real possibility that, if such a proposal were implemented, the result would be a rise in appeals involving not just claim constructions, but interpretations of claim constructions.

Guest Post: Because Inquiring Minds Want to Know – Best Mode – Why is it One-Sided?

Best Mode, Guest Post, Patent, Patent Legislation, ,

(Today PatentlyO is starting a series of periodic guest posts by Professor Christal Sheppard on the underlying rationales for some of the sections of the America Invents Act.  Prior to joining the University of Nebraska Lincoln College of Law this year, Dr. Sheppard was Chief Counsel on Patents and Trademarks and Courts and Competition policy for the United States House of Representatives Commmittee on the Judiciary. – JAR)

By A. Christal Shepard

Since inquiring minds want to know, I will attempt to give, in a series of posts, insights into the underlying rationales for a few sections of the America Invents Act that are causing particular confusion among my friends and new colleagues who were fortunate to not have been as intimately involved in the machinations of the America Invents Act as I have been over the last three Congresses.  

***

I start this conversation with a blanket statement – these are my recollections of the rationales and do not represent the views of any particular member of Congress.  More importantly, do not shoot the messenger.  This blog is only intended to provide contemporaneous context, not a comprehensive analysis, before the march of time distorts memories.  I will not attempt to defend; I will merely explain.

There has been a great deal of consternation and confusion about the changes to the Best Mode requirement, Section 15 of the America Invents Act.  This section is plain on its face, and yes, it is, and was intended to be, bifurcated. The Best Mode requirement remains a requirement, unchanged, for obtaining a patent under 35 U.S.C. § 112 Paragraph 1; however, under the new law, Best Mode can no longer be used as a defense in any action involving the validity or infringement of a patent.  More specifically, a failure of an inventor to disclose their Best Mode is no longer a basis for invalidating, canceling or making a claim unenforceable even if it is later determined that the inventor unquestionably knew of a Best Mode and intentionally did not disclose it to the United States Patent and Trademark Office (USPTO) during examination.  

The bifurcated reform is a compromise that addresses the legitimate litigation concerns with the subjective nature of Best Mode without undermining the requirement for full disclosure that is the quid pro quo for the grant of a monopoly.  If Best Mode was removed completely, Congress could be seen as removing yet another obstacle to trade secret protections overlapping with monopoly rights.  

The impetus for removal of Best Mode from Section 112 of Title 35 of the U.S.C. came from several recommendations to Congress to limit the subjective portions of patent litigations.  I point to one such recommendation that was highly influential, the National Academies’ A Patent System for the 21st Century: 

Among the factors that increase the cost and decrease the predictability of patent infringement litigation are issues unique to U.S. patent jurisprudence that depend on the assessment of a party’s state of mind at the time of the alleged infringement or the time of patent application… Because the [Best Mode] defense depends on historical facts and because the inventor’s state of mind usually can be established only by circumstantial evidence, litigation over [Best Mode]— especially pretrial discovery— can be extensive and time-consuming.[1]

Although the National Academies’ report also states that eliminating Best Mode completely could be accomplished without “substantially affecting the underlying principles that these aspects of the enforcement system were meant to promote.”[2] Their, and others’, primary objection to Best Mode was that it was an unnecessary burden for litigation, similar to inequitable conduct, often pled but rarely found.

While Best Mode may be unnecessarily burdensome for litigation, Best Mode is not a superfluous requirement.  It is intended to implement the constitutional directive of "promoting the progress of science and the useful arts"[3] by preventing an inventor from obtaining patent protection, “the embarrassment of a monopoly,”[4] while simultaneously concealing a trade secret for the preferred embodiments.  “The purpose of this requirement is to restrain inventors from applying for a patent while at the same time concealing from the public preferred embodiments which the inventor has, in fact, conceived.”[5]  There is nothing else in the patentability requirements that mandates an inventor’s disclosure of their Best Mode. 

The fault with Best Mode in litigation is not a fault of principle; it is a fault of execution – the difficulty of understanding the contents of an inventor’s mind.

If one believes in the quid pro quo of full disclosure to the public in exchange for a limited monopoly, then the disclosure of an inventor’s Best Mode is essential.  If monopoly is the carrot in exchange for divulging what otherwise would remain hidden as trade secrets then trade secrets SHOULD be divulged in order to patent.  Changing the Best Mode requirement for obtaining a patent would be a significant deviation from U.S. policy and practice that was unnecessary to correct the perceived problem. 

The law should and still does require disclosure of Best Mode, but has eliminated Best Mode from litigation.  The reform addresses the concerns without undermining the requirement for disclosure. 

Many scholars have questioned the fact that, under the new law, the day after a patent issues, the inventor could state that, yes there was a Best Mode known at the time of application that was not disclosed and yet the intentional nondisclosure would have no effect on the claims.  The claims could not be invalidated, canceled or made unenforceable.  

There has been a lot of criticism that Congress did not contemplate this result.  Nothing could be further from the truth. This result was absolutely contemplated by the decision makers.

Essentially the question was, how does one stop inventors from lying to the patent office, that the inventor has no Best Mode, when the inventor in fact has a preferred embodiment?  The more accurate question to ask is, when there are no obvious ramifications, why would an inventor divulge a Best Mode when they can keep it as a trade secret?  

Congress did take this into account but did not address it in the legislation for a variety of reasons. I present a few of the considerations that were discussed.

  1. Give the USPTO authority to undertake  investigations when it is presented clear evidence from a court or third party that a Best Mode was intentionally not disclosed.  Here, the counterargument is that the USPTO is even less well situated than the courts for such a subjective determination.  Furthermore, it is not practical to move this determination from the courts to the USPTO. 
  2. Present evidence of intentional concealment of Best Mode to the Office of Enrollment and Discipline (OED) at the USPTO with the deterrent being the possible loss of the ability to prosecute patents, removal from the patent bar.  This is arguably already possible under 35 U.S.C. § 32, Suspension or exclusion from practice.  The obvious flaw is the same as in the first example; the USPTO is not well situated for subjective inquiries.  Additionally, it may result in punishing the patent practitioner for situations where the inventor intentionally concealed but the patent practitioner was unaware.
  3. Institute a mechanism, identical to that which ultimately ended up in Section 12 of the America Invents Act – the new Section 257(e), where evidence of material fraud on the USPTO shall be referred to the Attorney General for possible prosecution under 18 U.S.C. § 1001, a criminal statute penalizing anyone who knowingly and willfully “makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry” on any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States. Again, arguably this deterrent, which is up to a five year prison term, is already possible under 18 U.S.C. § 1001 without any change in the law.

Note that all of these resolutions are arguably already possible under existing law.

One suggestion, not put forth, for the answer to the riddle of “when there are no obvious ramifications, why would an inventor divulge a Best Mode when they can keep it as a trade secret?” is make the ramifications more obvious. The USPTO could add a check box to application forms, stating “I (we), the inventor(s) have no preferred Best Mode and are aware that failure to disclose a Best Mode can result in up to a five year jail term.” But that is a matter for the USPTO and not Congress.

Would a “check box” solve the problem?  No.  But it is an affirmative act, as opposed to an intentional omission.  This affirmative act may be useful in the exercise of 35 U.S.C. § 32 and 18 U.S.C. § 1001 should there be abuses and allows Congress to preserve the U.S.'s emphasis on full disclosure in exchange for the government grant of monopoly.

In the end, I do not disagree with the criticisms of the effect of the new law on Best Mode.  But I do vehemently disagree that the consequences were neither considered nor understood by Congress.

[1] Stephen A. Merrill et al., A Patent System for the 21st Century, no. 7, 121 (2004).

[2] See id. at 7.

[3] U.S. Const. art. I, § 8, cl. 8.

[4] Thomas Jefferson to Isaac McPherson, 13 Aug. 1813.

[5] Young Dental Mfg. Co., Inc. v. Q3 Special Products, Inc., 112 F.3d 1137, 1144 (Fed. Cir. 1997).

 A. Christal Sheppard is an Assistant Professor of Law at the University of Nebraska Lincoln College of Law and former Chief Counsel on Patents and Trademarks and Courts and Competition policy for the United States House of Representatives Committee on the Judiciary.  Look for her next PatentlyO posting on Supplemental Examination.

Chief Judge Rader: Improving Patent Litigation

Patent,

Today, Chief Judge Rader delivered an important speech to a joint meeting of the Federal Circuit Bar Association and the Eastern District of Texas Bar Association. The focus was on the current and future state of patent litigation. His two word synopsis: Needs Improvement.

The Chief Judge identified what he sees as the primary, overarching problem with the US Court System: Its expense. Patent litigation is particularly expensive. Driving this is the high cost of discovery (even though fewer than 1 out of every 10,000 pages disclosed prior to trial actual result in a trial exhibit).

The Chief Judge expanded on his thoughts – listing six ways that patent litigation needs to be improved.

  1. Discovery: Controlling costs through the management and control of the discovery process. In particular, the Chief Judge pointed to blanket production orders that lead to wasteful production and review. As discussed below, the Federal Circuit Advisory Council has also released a new model order relating to e-discovery issues.
  2. Summary judgment. Increasing the use of summary judgment as a tool for the efficient resolution of disputes. As an alternative, summary judgment is also an efficient mechanism for narrowing disputes.
  3. Transfer motions and Joinder. Both the bench and bar should work to "find venues that best suit the convenience of parties" and have a more logical distribution of cases across the country – and especially to the jurisdictions that have self-identified as having expertise in patent law. We should also move away from the trend of having an excess of parties involved in the litigation.
  4. Early procedural and substantive valuation of cases. The court may want to have different procedures for billion-dollar cases as compared with thousand-dollar cases. (The UK has attempted to do this in its recent creation of a low-cost patent court designed for smaller disputes). Chief Judge Rader suggests that judges should proactively probe the parties to establish a value for the case based upon a legitimate damages model. That approach will hopefully have the beneficial effect of promoting better settlement discussions. (DDC Note: I typically begin my patent class with a discussion of remedies).
  5. Rules and Practice. Courts should implement a dependable set of pre-announced rules that apply to patent cases so that the parties can understand the nature of the litigation well in advance.
  6. Troll and Grasshopper Control. Chief Judge Rader's defines a problematic patent troll as someone simply seeking litigation-cost settlements, or, in other words, "any party that attempts to enforce a patent far beyond its actual value or contribution to the prior art." Chief Judge Rader also identifies problematic "Grasshoppers" who steal innovations and then "refuses to license even the strongest patent at even the most reasonable rates." The solution: Attorney Fees and Costs should be awarded in meritless cases. As the Chief Judge writes "I strongly advocate full-scale reversal of attorney fees and costs!"

Coordinated with his speech, Chief Judge Rader has worked with the Federal Circuit Advisory Council to develop a model order relating to discovery issues – with a goal of streamlining e-discovery, particularly email production, and to require litigants to focus on the proper purpose of discovery—"the gathering of material information—rather than on unlimited fishing expeditions." The core of the model rule is a cost-shifting associated with excessive production requests. General disclosures would not require e-mail disclosures unless specifically requested. And, e-mail disclosures would only be required for "specific issues" rather than general discovery associated with a product or business. The basis for the e-mail limitations comes from the FCAC's notion that:

Most discovery in patent litigation centers on what the patent states, how the accused products work, what the prior art discloses, and the proper calculation of damages. These topics are normally the most consequential in patent cases. Thus, far reaching e-discovery, such as mass email searches, is often tangential to adjudicating these issues.

The model rules are not being forced upon any court, but may well be persuasive. The potential for immediate cost shifting could certainly alter some practices.

Documents:

Notes: Members of the team who worked on the model order include Chief Judge Rader of the Court of Appeals for the Federal Circuit, Chief Judge James Ware of the Northern District of California, Judge Virginia Kendall of the Northern District of Illinois, Magistrate Judge Chad Everingham of the Eastern District of Texas, Tina Chappell of Intel, Richard "Chip" Lutton of Apple, Joseph Re of Knobbe Martens, Edward Reines of Weil Gotshal, Steve Susman of Susman Godfrey, and John Whealan of GWU Law School.

Post Grant: Narrowing Claim Construction Argument Creates Intervening Rights for Accused Infringers

Patent

by Dennis Crouch

Marine Polymer Tech. v. Hemcon, Inc. (Fed. Cir. 2011)

It seems that most accused infringers with a credible argument on prior art also file for reexamination or else the patentee preempts with a reissue application.  These cases create parallel processes ongoing in both the district court and USPTO with both bodies making interim determinations about claim scope and, ultimately, patent validity.  The balance of power and respect between the USPTO and the courts continues to be in flux, and that flux will most certainly continue as the USPTO implements the changes to the post grant system mandated by the Leahy-Smith reforms. 

In this case, the Federal Circuit has held that a narrowing claim construction argument made by the patentee in a reexamination gives rise to absolute intervening rights for accused infringer’s products made or sold prior to the reexamination request.  The key importance is that this decision is that the reexamination is was still ongoing at the time of this Federal Circuit decision.

Although we have not directly addressed whether arguments made to the PTO during reexamination can amend the scope of claims for purposes of the intervening rights doctrine, we have consistently held that arguments made to the PTO on reexamination can create an estoppel or disavowal and thereby change the scope of claims even when the language of the claims did not change. . . .

We see no reason why this rule, giving effect to disclaimer of claim scope during reexamination or reissue, should not also apply in the context of intervening rights.  In fact, a contrary rule would allow patentees to abuse the reexamination process by changing claims through argument rather than changing the language of the claims to preserve otherwise invalid claims and, at the same time, avoid creating intervening rights as to those claims.  Therefore, if the scope of the claims actually and substantively changed because of Marine Polymer’s arguments to the PTO, the claims have been amended by disavowal or estoppel, and intervening rights apply.  This is so even though Marine Polymer did not amend the language of its claims on reexamination.

An additional twist here is that the “narrow” claim construction argued by the patentee was simply the construction decided by the by the district court.  On appeal, however, the Federal Circuit held that the construction was erroneously narrow and that, therefore, the patentee’s argument was also a narrowing  argument.

The majority opinion was written by Judge Dyk who was joined by Judge Gajarsa.  Judge Lourie filed a dissent — arguing, inter alia, that by statute, intervening rights only apply to “amended or new claims.” See 35 U.S.C. 307(b) and 316(b).

When Monsanto’s Patents Expire

Patent,

PatentlyO113Monsanto Co. v. Vernon Bowman (Fed. Cir. 2011)

The Federal Circuit has again affirmed that Monsanto’s genetically modified seeds patents can be used to stop farmers from saving and replanting the GM seeds.  Here, the particular issue involved patent exhaustion, and the court ruled that the authorized purchase of seeds did not include the right to replant the second generation.  The legal theory here follows the same notion of copyright in book buying.  When someone purchases a book, they do not typically also receive a right to make further copies.  There are some debatable differences — Monsanto’s soybeans are alive and have the ability to self-replicate. However, the court previously rejected those arguments.

Monsanto’s two patents at issue in this case are U.S. Patent Nos. 5,352,605 (“’605 Patent”) and RE39,247 (“’247 Patent”). The ‘605 patent expires in October 2011, and the ‘247 patent patent expires in 2014. 

As the Bowman and Scruggs cases suggest, Monsanto has alway aggressively enforced these patent rights. However, Monsanto has announced that once the patents expire, it will no longer enforce its existing technology licenses. At that point, farmers will be free to save their GM soybean seeds and replant them at will.  In addition, the expiration of the patents also allows others to manufacture other Roundup Ready organisms.  Obviously, the point here is that the patents’ expiration will likely further expand the use of GM organisms.  Up to now, Monsanto’s profit motive has seemingly helped organic and non-GM producers in their quest to keep their seed lines separate. Patent expiration will dramatically change this status quo.

35 U.S.C. § 102 (newly amended by the Leahy-Smith America Invents Act of 2011)

Patent

As a site for referral and contemplation, I wanted to include the text of the newly drafted statute 35 U.S.C. § 102.

Sec. 102. Conditions for patentability; novelty

(a)    Novelty; Prior Art- A person shall be entitled to a patent unless—

1.    the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention; or

2.    the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.

(b)    Exceptions-

1.    DISCLOSURES MADE 1 YEAR OR LESS BEFORE THE EFFECTIVE FILING DATE OF THE CLAIMED INVENTION- A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention under subsection (a)(1) if—

A.    the disclosure was made by the inventor or joint inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or

B.    the subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor.

2.    DISCLOSURES APPEARING IN APPLICATIONS AND PATENTS- A disclosure shall not be prior art to a claimed invention under subsection (a)(2) if–

A.    the subject matter disclosed was obtained directly or indirectly from the inventor or a joint inventor;

B.    the subject matter disclosed had, before such subject matter was effectively filed under subsection (a)(2), been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or

C.    the subject matter disclosed and the claimed invention, not later than the effective filing date of the claimed invention, were owned by the same person or subject to an obligation of assignment to the same person.

(c)    {CREATE ACT Save for later}

(d)    Patents and Published Applications Effective as Prior Art- For purposes of determining whether a patent or application for patent is prior art to a claimed invention under subsection (a)(2), such patent or application shall be considered to have been effectively filed, with respect to any subject matter described in the patent or application—

1.    if paragraph (2) does not apply, as of the actual filing date of the patent or the application for patent; or

2.    if the patent or application for patent is entitled to claim a right of priority under section 119, 365(a), or 365(b), or to claim the benefit of an earlier filing date under section 120, 121, or 365(c), based upon 1 or more prior filed applications for patent, as of the filing date of the earliest such application that describes the subject matter.’.

 

Dissents: Judges Newman and Dyk

Patent

After considering the merits of a case, Judges Pauline Newman and Timothy Dyk often arrive at opposite conclusions. As just a sample, I thumbed through all of the precedential patent decisions that involved both judges since January 2010. Of those 25 decisions, the pair disagreed on the outcome or application of the law in 19. I.e., the two judges disagreed in more than 75% of the cases.

Dissents are now fairly common. During the past two years about 25% of precedential decisions included a dissenting opinion. Of course, in 2/3 of those cases either Judge Newman or Judge Dyk was involved in the dissent.

A note on these figures – they include en banc decisions where multiple opinions are much more likely. When restricted to three-member panels, the Newman-Dyk disagreement rate dropped to just under 60% (7/12) in precedential decisions.

Guest Post: Preclusive Inventor Disclosure Under Leahy-Smith

Patent, ,

Guest Post by Jeffrey Lefstin, Ph.D., Professor of Law at the University of California Hastings College of the Law

Under Leahy-Smith, inventor disclosures made less than one year before filing are themselves not prior art.  But these  disclosures play two entirely new roles in the Leahy-Smith scheme.  New § 102(b)(2) provides that a disclosure is not prior art if the “subject matter disclosed” had previously been “publicly disclosed” by an inventor (or one who derived it from an inventor).  And inventor disclosure precludes the defense of prior commercial use if that use commences less than one year before the inventor's disclosure.

Patent academics and practitioners are hotly debating whether inventor “disclosures” under § 102(b) are coterminous with the events that defeat patentability under § 102(a). But this debate overlooks what may be a more difficult conceptual question:  what is the preclusive scope of a disclosure under § 102(b)?

A preliminary question is whether an inventor who has made a “disclosure” protected by § 102(b)(1)(A) has “publicly disclosed” subject matter so as to preclude prior art under § 102(b)(1)(B). Did Congress intend that some inventor disclosures do not bar patentability, but nonetheless fail to preclude subsequent prior art? And must inventor preclusive disclosures under § 102(b)(1)(B) actually be within one year of filing?

Regardless of what it means to “publicly” disclose, Leahy-Smith seems to require a qualitatively different analysis than those we are familiar with in patent law. Section 102(b)(1)(B) defines the ability of an inventor to exclude prior part not in terms of comparison between disclosure and claim, but between the inventor’s disclosure and a subsequent third-party disclosure:  the inventor must have previously disclosed the “subject matter” appearing in a later third party disclosure to exclude it as prior art. This inquiry may pose some perplexing problems. The inventor’s disclosure and the third party’s disclosure may well be of incommensurable forms. How do we compare a publication to sale, or a public use of a tangible object to a patent disclosure? Moreover, the inventor’s disclosure and the third party’s disclosure are unlikely to be at the same level of generality:  one is likely to be broader or narrower then the other.

Consider, for example, an inventor who publicly discloses a fuel consisting of 80% gasoline and 20% ethanol. Does that disclosure preclude a third-party disclosure of a 75%-25% mixture? A generic third-party disclosure of mixtures of ethanol with petroleum products? What if the inventor disclosed a mixture of gasoline and ethanol in generic terms rather than a particular composition?

Answers to these questions depend on the approach the courts take to the scope of preclusive disclosure under Leahy-Smith, and the choice of approach may have a huge impact on the inventor’s ability to preclude later prior art by disclosure. I outline two basic approaches here:  a claim-focused approach that is easier to administer and more generous to inventors, but seems less grounded in the statutory text; and a subject matter-focused approach, that is more supportable by the statutory text, but potentially less favorable to inventors and much more difficult to administer. 

Claim-Focused Approaches
The simplest approach would be that inventor disclosure immunizes any claim that encompasses the inventor’s disclosure.   Under this approach, prior art appearing subsequent to the preclusive disclosure cannot be asserted against a claim reading on the preclusive disclosure. That immunity could either be extended to dependent claims that do not themselves read on the preclusive disclosure (thereby permitting the inventor to claim species disclosed by third parties), or restricted to claims that directly read upon the preclusive disclosure (thereby prohibiting the inventor to claim species disclosed by a third party).

The claim-focused approach permits us to use our existing framework for assessing novelty under § 102, because the only inquiry would be inclusion of the preclusive disclosure in a later claim. In addition, because in the strong form of the approach preclusive scope does not depend on the content of the later third-party disclosure, it eliminates the possibility of strategic disclosures by third parties and the disputes likely to ensue over whether the third-party’s disclosure was derived from the inventor’s.

The claim-focused approach is not the most faithful to the statutory text, because new § 102(b) defines the prior art exclusion by the subject matter disclosed by the inventor, not by a claim encompassing the inventor’s disclosure. Nonetheless, this interpretation  would be attractive to a court seeking a straightforward analysis, or a court seeking to temper Leahy-Smith’s impact on the prior art regime.

Subject Matter-Focused Approaches
What if we confine preclusion to the actual “subject matter” disclosed by the inventor? We then need a methodology to define the preclusive scope of an inventor disclosure.  We might establish the broadest preclusive scope based on an inventor disclosure, and exclude from prior art all subject matter within that scope.  All things within the broadest preclusive scope of the disclosure would be claimable – including species later disclosed by third parties – although the inventor would not be immunized against disclosures lying outside the maximum preclusive scope.

Alternatively, we might define preclusive scope at a particular level of generality.  Under this variation a preclusive disclosure of a genus might not immunize a generic claim from anticipation by a third party’s disclosure of a species.

The difficulty with the subject matter-focused approaches is how to define the preclusive scope, whether it be the broadest possible or confined to a particular level of generality. The problem seems parallel to the question of support for a claim under § 112 – particularly if we regard the written description requirement as defining the level of generality or specificity at which an inventor may claim. However, a patent disclosure is drafted specifically to support claims.  How could we derive a permissible scope from a non-patent disclosure, particularly if  § 102(b) “disclosures” include non-informing public uses or sales?  In interferences, we do ask whether an inventor is entitled to make the interference count based on a non-patent disclosure, such as a documented conception or reduction to practice. But traditional interference practice awards priority of a generic count upon a showing of priority to a species, so the question of permissible scope from non-patent disclosure does not arise.

An alternative method of defining preclusive scope would rely instead on analogy to § 103:  preclusive scope might be defined by what is obvious in light of the inventor’s disclosure. An obviousness-based definition would permit us to ask whether more specific subsequent disclosures were obvious in light of the inventor’s more general earlier disclosure. But since a later-disclosed genus would always be obvious over an earlier-disclosed species, the obviousness-based definition seems to always exclude any later disclosure more generic than the inventor’s. Worse, if a third party later discloses a non-obvious species, that species would seem to count as prior art, likely anticipating any generic claim by the inventor.

The Prior User Defense
The same conceptual problems arise in applying the Leahy-Smith Act’s new expanded defense of prior commercial use.  Under new § 273(a)(2)(B), the prior commercial use defense is not available if use commenced less than 1 year before “the date on which the claimed invention was disclosed to the public in a manner that qualified for the exception from prior art under section 102(b).”

But new § 102(b) does not deal with disclosures of claimed inventions; it excepts from prior art disclosures by inventors or of the same subject matter previously disclosed by inventors. In deciding what claims are exempt from the prior use defense, we are faced with the same problem we face in interpreting the scope of preclusive disclosure.  Is any claim that would encompass a preclusive disclosure impervious against the prior use defense, or is some more complex 112- or 103-like inquiry necessary to decide which claims qualify?

The reference in § 273 to disclosure of  a “claimed invention” under § 102(b) might nonetheless provide the key to interpreting the scope of preclusive disclosure under § 102(b).  Although § 102(b) literally defines preclusive scope in terms of the subject matter actually disclosed by the inventor, if we can only harmonize § 102(b) and § 273(a)(2)(B) by defining preclusive scope in terms of a claimed invention, then the principle of in pari materia might lead a court to embrace the claim-focused approach in construing § 102(b).

Disqualifying Plaintiff’s Litigation Counsel based upon Former Joint Defense Agreement

Patent

By Dennis Crouch

In re Shared Memory Graphics LLC (Fed. Cir. 2011), Opinion by Judge Dyk, dissent by Judge Newman (Can you believe that these two would disagree?)

This case involves a disqualification motion. Nintendo (the alleged infringer) was sued for infringement by SMG. The firm of Floyd & Buss represents the plaintiffs and the firm’s partnership includes Kent Cooper who is the former IP director at Advanced Micro Devices (AMD).

While Cooper was at AMD, Nintendo and AMD were co-defendants in a separate patent infringement lawsuit and part of a joint defense agreement. The JDA included a provision that the agreement would not be used to “seek to disqualify the respective counsel of such party in any future litigation.” However, Nintendo argued in the JDA does not apply to Cooper because he is no longer AMD’s counsel. The district court agreed with this interpretation disqualified the Floyd & Buss firm based upon the conclusive presumption that Cooper had access to Nintendo’s confidential information. (The district court more broadly disqualified Floyd & Buss from representing the plaintiffs against any of the accused infringers.)

On writ of mandamus, the Federal Circuit reversed – finding that the plain language of the JDA covered Cooper even after he left his position at AMD. The court also held that such a waiver is enforceable – especially when signed by two sophisticated parties.

In dissent, Judge Newman suggested that Cooper’s switching of sides and failure to maintain confidences is damning to our system of professional legal representation: “the issue is the integrity of the system of legal representation in today’s world of mobile lawyers and large law firms with interacting clients. . . . [I]t appears that Cooper in his new employment is associated with issues involving his former employer, and that his former employment was at the highest level in interaction with Nintendo’s legal and strategic interests. If there is doubt, it must be resolved in favor of the entity whose information is in jeopardy.”

 

Implementation of the America Invents Act

Patent, ,

New Fees – 15% increase: The USPTO has announced new fees that will become effective on September 26, 2011. These fees represent an across-the-board 15% increase for almost all PTO fees. The effective date of the fees will be applied based upon the associated underlying filing date. Thus, a new application properly filed by Express Mail on September 25, 2011 will be charged under the old regime even if it does not arrive at the USPTO until September 26. Likewise, for most other responses, the date of the certificate of mailing will be used to calculate the fees due. [Link]

New Fees – Micro Entity: A new micro entity status has been created by the AIA that provides for a 75% discount on fees for certain applicants (including universities with operating budgets of more than $1 billion). However, the USPTO has announced that the micro entity status will only become effective after it implements final regulations on the topic.

Inter Partes Reexamination: Already effective is a new standard for initiating an inter partes reexamination. The new standard requires a showing that there is a reasonable likelihood that the requester will prevail with respect to at least one of the patent claims challenged in the request. This is a stricter standard that the old requirement of a substantial new question of patentability. The standard for ex parte reexamination remains unchanged. In one year (on September 16, 2012), the USPTO will stop accepting inter partes reexamination requests and instead move to the new inter partes review procedure. The new review proceeding will be conducted before the new Patent Trial and Appeal Board rather than before an examiner. At the one-year anniversary, new post-grant review proceedings, transitional business method review proceedings, and supplemental examination proceedings will also be implemented.

Tax Strategies: As part of the AIA, all tax strategies have been deemed to be within the prior art and therefore a tax strategy cannot be used to distinguish the claimed invention from the prior art. There are some limits so that developers of certain software can still obtain patents. This provision applies to any application now pending or yet to be filed. In his memo to examiners, Robert Bahr indicated that examiners should treat tax strategy limitations in the same way that printed matter limitations are treated under MPEP 2112.01 (III).

Human Organisms: The USPTO has taken the position that the ban on the patenting of human organisms does not change its longstanding policy in any way. Thus, under the rule a claim is not patentable if, when interpreted as a whole, it "encompasses a human being."

Disclosure under the AIA: Introducing The Poor Man’s Provisional Patent Application

Patent,

By Dennis Crouch

Provisional patent applications have received increasing focus as an integral element of corporate patent filing strategy. Although many patent attorneys reject this strategy, hopeful US-based patentees regularly use provisional applications as a cheap method for obtaining an early patent application priority filing date. Provisional applications have a very low filing fee and do not require the same level of formality as a true or non-provisional application. In this sense, a provisional application is thought of as a “poor man’s patent application.” A provisional filing allows an applicant to obtain an early filing date for a low cost and delay or avoid further prosecution costs. And, with provisional applications, patent term is not lost but simply shifted forward in time.

Delaying Decisions: In my empirical studies, I find that a substantial number of provisional patent applications are abandoned. That statistic suggests that the provisional system is working as a mechanism for delaying the decision on whether to substantially invest resources in the newly invented technology. The one-year delay can be important in providing applicants with time to determine whether the particular avenue of technology will be commercially important.

Substitute for Invention-Date Rights: In my article on invention date novelty, I argued that provisional patent applications serve as a partial substitute – or an alternative approach – for patent applicants attempting to rely upon their date of invention when proving patentability. The early provisional filing date is often a much simpler alternative than proving conception, diligence, and reduction-to-practice. In my article, I treated provisional applications as an alternative choice available to applicants who want to show an early priority date and who do not want take the steps required claim that date based upon pre-filing invention activity. The recently enacted Leahy-Smith America Invents Act (AIA) changes that alternative into something of an imperative in that the new law largely eliminates an a patent applicant’s ability to rely upon anything other than a filed application in proving priority of invention. I expect that this change in the law will lead even more companies to choose provisional applications filings a core tactic in their approach to patenting.

Grace Period for Disclosure: Under the AIA, an inventor’s early filing date is important because any disclosure by a third party prior to the inventor’s filing date will normally be seen as prior art that can negate patentability. There are two major exceptions to this general rule: a third party disclosure within one-year of the applicant’s filing date not count as prior art if either (1) the inventor had already disclosed the invention prior to the third party disclosure or (2) the third party disclosure was somehow derived from the inventor. As Professor Jason Rantanen has discussed, this provision offers an incentive to applicants to go ahead and disclose their invention as a mechanism of defeating potential prior art.

Poor Man’s Provisional Application: In many ways, a pre-filing disclosure draws a line in the sands of time in much the same way that a provisional application establishes a priority date. Self-disclosure offers similar benefits to that of a provisional application in that it is cheap with few formalities and provides an additional year of delay. In fact, public disclosure should be cheaper and easier than filing a provisional application. In the same way that a provisional application is seen as a poor man’s patent application, I suggest that public disclosure will be seen as a poor man’s provisional application or a “really poor man’s patent application.” The disclosure allows an applicant to buy an additional year of delay with few capital expenditures and without losing patent term but instead merely shifting the term forward in time.

Some of the Problems with Disclosure: There are a number of problems with the pre-filing disclosure strategy. Most importantly, a pre-filing disclosure would substantially negate the potential for non-US patent rights because most other countries have a more absolute rule that pre-filing disclosures negate patentability. In addition, a public disclosure eliminates the ability of an applicant to pursue technology development in secrecy. (Provisional applications are not made public until well after their one-year expiration.) However, the new law does not require that the public disclosure identify the inventor or assignee but only that the invention be publicly disclosed. This offers potential anonymity if not absolute secrecy. Finally, the lack of formal requirements associated with the disclosure invites cost cutting and low quality, inadequate disclosures. This will scare forward looking attorneys who realize that the underlying purpose of the disclosures is as legal documents relied upon to prove priority.

Ultramercial v. Hulu: Computer Programs and Patentable Subject Matter

Patent,

By Jason Rantanen

Ultramercial, LLC v. Hulu, LLC (Fed. Cir. 2011)
Panel: Rader (author), Lourie, O'Malley

The line between patentable processes and unpatentable abstract ideas continues to trouble the Federal Circuit even as the Supreme Court prepares to address the issue for the second time in four years in Mayo v. Prometheus.  In Ultramercial, the court—led in this instance by Judge Rader, whose views on patentable subject matter are clear and well known—rejected a challenge based on lack of patentable subject matter in an opinion that draws the line between steps that can be performed in the human mind or by a human using pencil and paper (unpatentable) as opposed to those that require a computer (patentable).

Patent No. 7,346,545 claims a method for distributing copyrighted products over the Internet where the consumer receives a copyrighted product for free in exchange for viewing an advertisement and the advertiser pays for the copyrighted content.  The district court granted the accused infringer's motion to dismiss on the ground that the '545 patent does not claim patentable subject matter.

Patentable application not an abstract idea
On appeal, the CAFC reversed. After noting the broadly permissive nature of Section 101, and placing the '545 invention in the "process" category, the court looked to the abstractness of the invention claimed by the '545 patent.  Eschewing the "machine or transformation test," the court focused instead on the programming complexity required to carry out the claimed elements.  The claimed invention, the court determined, constituted a patentable application rather than an unpatentable abstract idea. While "the mere idea that advertising can be used as a form of currency is abstract, just as the vague, unapplied concept of hedging proved patent-ineligible in Bilski,…the '545 patent does not simply claim the age-old idea that advertising can serve as a currency.  Instead, the '545 patent discloses a practical application of this idea."   Slip Op. at 10.  This statement is followed by identification of the specific steps for monetizing copyrighted products set out in the claims, many of which involve complex computer programming.  "Viewing the subject matter as a whole, the invention involves an extensive computer interface."  Slip Op. at 11.

Software is patentable
Layered on top of this finding is the court's rejection of the argument that software programming amounts to abstract subject matter.  "The digital computer may be considered by some the greatest invention of the twentieth century, and both this court and the Patent Office have long acknowledged that "improvements thereof" through interchangeble software or hardware enhancements deserve patent protection.  Far from abstract, advances in computer technology—both hardware and software—drive innovation in every area of scientific and technical endeavor."  Slip Op. at 12.

This holding is in tension with the Federal Circuit's recent opinion in Cyber Source Corp. v. Retail Decisions, Inc., No. 2009-1358 (Fed. Cir. Aug. 16, 2011), in which a panel consisting of Judges Bryson, Dyk and Prost concluded that a method of verifying a credit card transaction over the Internet constituted an unpatentable process.  While the panel in Ultramercial recognized this tension, it distinguished Cyber Source as an instance of "purely mental steps."  Ultramercial Slip Op. at 13 (emphasis in original).  The line, at least from the point of view of this panel, thus lies somewhere between logical steps that humans can perform without the aid of a computer versus those that require a computer to carry out.

Rush to Judgment: New Dis-Joinder Rules and Non-Practicing Entities

Patent

On Thursday, September 15, 2011, at least 54 new patent cases were filed – accusing over 800 corporate entities of patent infringement. These numbers represent an all-time-high for a single day filing. In Thursday’s filings, the average complaint accused 16 entities of patent infringement. Those numbers are indicative of a trend over the past few years to accuse multiple parties of infringement within a single lawsuit.

Thursday’s highs are not random. On Friday, September 16, 2011, President Obama was scheduled to, and did actually, enact a major patent reform package known as the Leahy-Smith America Invents Act (H.R. 1249). One provision of the new law strips courts of their power to join multiple defendants in a single lawsuit simply based upon the fact that the defendants are all alleged to infringe the same patent.

[A]ccused infringers may not be joined in one action as defendants or counterclaim defendants, or have their actions consolidated for trial, based solely on allegations that they each have infringed the patent or patents in suit.

Under the new law, joinder of multiple defendants is still possible, but “only if” the right to relief against all the parties (1) “aris[es] out of the same transaction, occurrence, or series of transactions or occurrences relating to the making, using, importing into the United States, offering for sale, or selling of the same accused product or process” and (2) is based on common questions of fact.

This dis-joinder provision applies to all cases filed on or after the September 16 date of enactment and it is likely that it is the dis-joinder provision that led to the massive filings. As Kyle Jensen of PriorSMArt wrote:

The uncertainty caused by patent reform produced a flood of litigation these last two weeks, which has made our alerts more voluminous than is typical. Last Thursday 54 new patent cases were opened nationwide against a total of 804 named defendants (based on cases that have hit CM/ECF, some might not have). That is an all-time record for both statistics by my count.

Plaintiffs in the most recent filings include non-practicing entities such as LVL Patent Group; GeoTag; Innovatio IP Ventures (not IntellectualVentures); InMotion Imagery; LVL purchased its patents from CyberFone – those patents had been up for auction in an Ocean Tomo auction but then privately changed hands in 2011. Likewise, InMotion’s patents were purchased at an Ocean Tomo auction. Innovatio obtained its patents from Broadcom.

Using information from PACER and LEXMACHINA, I created my own chart below of the number of cases filed in July, August, and September 2011.

The bulk of these new filings are in the usual venues of E.D. Texas (15%), Delaware (13%), C.D. California (9%), N.D. Illinois (8%), and N.D. California (6%). However, there is also a surprising diversity in that in the past 80 days, thirty-three jurisdictions have seen five or more new patent complaints or transferred cases. One potential impact of the new dis-joinder rules is a greater jurisdictional diversity, however, that result is not guaranteed.

The dis-joinder provisions were put in place as a hurdle for non-practicing entities alleging infringement across an industry. However, I have spoken with a number of in-house counsel that are a bit worried about the new joinder rules. In particular, the mass-defendant-litigation provides potential cover for in-house counsel and may smooth settlement because the plaintiffs rarely want to try more than two defendants before a single jury.

 

 

No Patent for Claimed Method of Patenting

Patent,

In 2000, patent attorney Jeff Grainger filed his provisional application for a "computer implemented method for securing intellectual property rights." The claimed method consisted of a system that used an electronic information disclosure form that actively prompted users to provide invention-related information and then automatically converting the information to patent application format. The dependent claims focused on specific prompts – such as "best mode" and "enablement" information.

The first rejection came in 2005, followed by a final rejection in 2006 and the BPAI appeal finally decided in 2011.

The key prior art cited by the examiner was the old ePave filing system.

In the BPAI appeal, Grainger's attorneys at the Kilpatrick Townsend firm had argued that the claimed active prompting for best mode or enablement information was a non-obvious advance over the prior art. The board rejected that argument – explaining that one of skill in the art knows the statutory requirements for a patent application and therefore "ePave's data fields for submitting the Specification, with their textual cues that the Specification is asked for" renders the claimed invention obvious.

At that point the applicant gave-in and has allowed the application to go abandoned – apparently without further continuation.

Grainger is now a partner at the early-stage start-up and investment group known as The Foundry. Back in 2000, he was a founder of First to File, Inc., which he then sold and which now holds the intellectual property rights.