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Timely filing of patent applications: Lessons learned from Michael Jackson and Smooth Criminal

The U.S. Patent Act provides that an inventor is barred from obtaining patent rights for an invention, and the invention goes into the public domain, when a patent application is not filed within one year of certain activities of the inventor that make the invention available to the public. This is often referred to as the “one year grace period.” Many inventors are unaware of or forget about this time limitation and mistakenly lose rights to their inventions.

Did you know that the pop icon Michael Jackson was an inventor? Michael created a gravity defying dance move often referred to as the “anti-gravity lean,” in which he has both feet on the floor and leans forward nearly 45 degrees in a gravity-defying manner. This lean first appeared in the 1987 music video (see the 7:15 mark) for the song “Smooth Criminal.” The lean again appeared in the 1988 short film (see the 8:20 mark) titled “Moonwalker” during the song Smooth Criminal. Michael first performed the song and the dance move live on stage during the second leg of his 1988-1989 Bad World Tour which began in February 1988.

The anti-gravity lean was performed with wires during the music videos but these wires could not be adequately hidden from view during live performances. To accomplish this dance move on live stage, Michael developed a system where pins were embedded into the stage floor and at the right moment special shoes with ankle support and grooves in the …

Patent troll moves forward with antitrust claim against defensive anti-troll

Can a group of defendants refuse to settle with a non-practicing entity (NPE)? Can they collectively refuse to license patents from a “troll”? Or does that refusal subject them to antitrust scrutiny? These are the issues at the heart of a Northern District of California case: Cascades Computer Innovation LLC v. RPX Corp.

Cascades manages a portfolio of patents and filed suit against a number of large technology companies for infringement. Those companies are members of RPX Corporation (RPX), a defensive patent aggregator formed to protect its members from NPEs who file infringement claims. When RPX, on behalf of its members, failed to reach a licensing agreement with Cascade, Cascade sued RPX and its members — including Dell, HTC, LG, Motorola and Samsung — claiming that defendants’ alleged collective refusal to deal with it constituted an antitrust violation.

Not only is this case unique in that an NPE, or “patent troll” in some circles, is striking out at alleged infringers with an antitrust attack, but the case was dismissed with what many thought was no hope of revival. Alas, Cascades’ amended complaint included enough additional facts to allow the case to move forward.…

FTC study on “patent troll” behavior: innovation enhancers or competition killers? Part 2

In the second of this two part series, we dig a bit deeper on the FTC’s recently proposed study on patent assertion entity (PAE) activity. In Part 1, we covered some background on PAEs and why they are singled out separately from other types of patent holders. Here in part 2, we discuss potential antitrust concerns with PAE activity, what information the FTC is seeking from PAEs and others, and — importantly — what the study means for you.

Potential antitrust issues

To place into context the entire concern with PAEs, as well as to better understand why the Federal Trade Commission is seeking the type of information it is requesting, we delineate briefly the potential antitrust concerns with PAE activity. It must be understood that a valid patent holder unquestionably has the right to exercise his/her patent, or to sit back and sue for infringement should another entity utilize the patent without permission. The mere assertion or enforcement of a PAE patent cannot, without more, constitute an antitrust violation. Nevertheless, a number of different antitrust concerns are implicated with PAE activity, the most prominent of which are presented below.

1. Acquisition and licensing of patents

A patent is an asset and, like any other asset, the more one acquires within a given market, the greater the concern that the acquirer will eventually garner market power and the ability to price its products/services above competitive levels. Or, in the patent context, license the patents above competitive levels. Though not …

FTC study on “patent troll” behavior: innovation enhancers or competition killers?

Executive Summary

Almost half of all infringement actions brought these days are brought by patentholders that do not practice the invention, but rather by holders who seek to capitalize on the value of the patent through either licensing fees or via damage awards in infringement actions. While simply asserting patent rights cannot be an antitrust violation, the manner in which these patent holders — referred to Patent Assertion Entities (PAEs) or sometimes, pejoratively, as “patent trolls” — amass their portfolios and assert their patents can raise antitrust concerns. Given the enormous toll that patent litigation takes on our innovation economy, the Federal Trade Commission has proposed a study “to understand how PAE behavior compares with patent assertion activity by other patent owners.” This post provides background on the issue and why PAEs are singled out separately from other types of patent holders. A subsequent post will discuss potential antitrust concerns with PAE activity, what information the FTC is seeking from PAEs and others, and what the study means for you.

Background

For years, patent law and antitrust law have butted heads because patent law, which grants the patentee the right to exclude, is the antithesis of antitrust law, which seeks to increase output and maximize consumer welfare. Although the Sherman Act, the federal government’s basic antitrust law, has been hailed as the “magna carta of free enterprise,” patent law is rooted in the Constitution and accordingly has emerged victorious when the two have come into conflict. Over the past decade, …

Ammunition to rebut “obvious to try”

The recent Federal Circuit Court of Appeals decision in Leo Pharmaceutical Products, Ltd. v. Rea (Appeal No. 2012-1530, 2013 U.S. App. LEXIS 16610, decided Aug. 12, 2013) provides patent applicants and owners with some valuable ammunition in rebutting “obvious to try” based obviousness assertions against patent claims under 35 U.S.C. §103, both during patent prosecution and patent invalidity proceedings.

In Leo, an appeal from an inter partes reexamination proceeding at the U.S. Patent and Trademark Office, the court reversed the Board of Patent Appeals and Interferences’ holding of obviousness of a pharmaceutical composition on the basis that a person of ordinary skill in the art would not have been motivated to try, let alone make, the claimed invention (*14).

The court found that a claimed storage stable pharmaceutical composition comprising (1) at least one vitamin D analogue, (2) at least one corticosteroid, and (3) at least one solvent selected from a specified group, was “not simply a combination of elements found in the prior art” (*11) (three prior art references relied upon by the Board in finding the compositions obvious), but, rather, the inventors recognized and solved a problem with the storage stability of certain formulations — a problem that the prior art did not recognize and a problem that was not solved for more than a decade:…

Crowdsourced database now available to help identify patent trolls

You received a threatening letter from what looks like a “patent troll”  demanding a licensing fee and/or royalties but you can find little or no information about the party that sent the letter.  The sending party may not even be the owner of record for the identified patent(s) at the USPTO.  You may not even be able to determine whether or not the sending party is a patent troll.  How do you identify who you are up against?  A new online crowdsourcing tool, referred to as Trolling Effects, was launched on July 31, 2013 that provides a database of demand letters and other information that can help you identify patent trolls.  The Trolling Effects database is available at www.trollingeffects.org

Patent trolls often send letters to businesses demanding payment of a licensing fee to avoid expensive patent infringement litigation. In some instances, a draft complaint is attached and the letter states that the complaint will be filed on a certain date if the licensing fee is not timely paid.  The licensing fee is typically low enough that many businesses simply pay the fee just to make the patent troll go away.  Sometimes these demand letters are sent by the thousands or even tens of thousands so that the patent trolling becomes a profitable business model even if complaints are never or rarely filed.…

Isolated genes fail while synthetic cDNA survives US Supreme Court

In a long-awaited and much-anticipated decision, the US Supreme Court today issued a unanimous opinion in Association for Molecular Pathology v. Myriad Genetics, Inc., involving the BRCA1 and BRCA2 genes relevant to detection of increased risk of breast and ovarian cancer. The Court held that a naturally occurring DNA segment is a product of nature and not patent eligible merely because it has been isolated, even despite extensive research efforts that may have been conducted to determine the location of the gene in order to isolate it. 

On the other hand, the Court held that complementary DNA (synthetic DNA referred to as “cDNA”) does not present the same obstacles to patentability as naturally occurring, isolated DNA segments becuase “creation of a cDNA sequence from mRNA results in an exons-only molecule that is not naturally occurring” in that “the non-coding regions have been removed.” The Court concluded that “cDNA is not a ‘product of nature’ and is patent eligible under [35 USC] §101, except insofar as very short series of DNA may have no intervening introns to remove when creating cDNA. In that situation, a short strand of DNA may be indistinguishable from natural DNA.” Finally, the Court acknowledged that this case did not involve patents on new applications of knowledge about the BRCA1 and BRCA2 genes, and many of Myriad’s unchallenged claims are limited to such applications.

The Court’s decision will end the US Patent and Trademark Office’s policy of granting patents on isolated genes, and patent practitioners will …

Update on patent trolls

The America Invents Act (AIA), which became fully implemented March 16, 2013, revised U.S. patent law but included few reforms directed to curbing Non-Practicing Entity (NPE) or “patent troll” activity. Thus, not surprisingly, patent troll activity has continued at an alarming rate during the early months of 2013. Summarized below are the recent activities of the most infamous patent trolls.

Fortunately, the president and the legislature appear to desire additional patent reform to address patent trolls. On Feb. 14, 2013, President Barack Obama addressed patent trolls and the need for more comprehensive patent reform in a “Fireside Hangout” which is a live question and answer session hosted in a Google+ hangout. President Obama acknowledged that the reforms of the AIA “only went about halfway to where we need to go.”

On Feb. 25, 2013, the Saving High-Tech Innovators from Egregious Legal Disputes (SHIELD) Act of 2013 (H.R. 845) was reintroduced into the House by Rep. Peter DeFazio, D-Ore. and Rep. Jason Chaffetz, R-Utah. The SHIELD Act mandates a fee award to any party victorious on the issue of non-infringement or invalidity. This means that a company can sue for declaratory relief and recover its costs, even though the patentee never filed suit. The SHIELD Act excludes the inventors or “original assignees”, universities and their technology transfer organizations, and patentees that have a “substantial investment” in the exploitation of a patent via production or sale. The SHIELD Act requires NPEs to post a bond for the fees upon filing an infringement …

New European Unitary Patent and Unified Patent Court are on the horizon

Soon, a new unitary patent system will bring reduced cost and greater uniformity to European patents. The Unified Patent Court Agreement was signed Feb. 19, 2013 at the Council of the European Union meeting in Brussels, Belgium. At the meeting, ministers from 24 contracting EU member states signed on to the agreement establishing a Unified Patent Court (UPC). The Unified Patent Court Agreement represents one of the final major steps in forming a unitary patent system for Europe. The development of a European unitary patent system has been under discussion and development since the 1970s. The signing of the UPC agreement follows the adoption in December 2012 and entry into force of two regulations related to the unitary patent system. These two regulations pertain to unitary patent protection and the translation arrangements associated with the unitary patent, and came about through use of the enhanced cooperation procedure.

The European patent with unitary effect (“unitary patent”) will be a European patent granted by the European Patent Office (EPO) under the provisions of the European Patent Convention. The unitary patent will not replace national patents and classical European patents, but will instead offer another option for parties seeking patent protection. The EPO will continue with its existing search, examination and granting procedures. Following patent grant the patentee may request unitary effect for the member states participating in the unitary patent, and will be able to maintain a classical European patent for the European patent convention contracting states that are not participants in …

First-to-file patent system arrives March 16, 2013

With significant changes to law governing how the U.S. grants patents taking effect next month, Porter Wright recommends that all clients consider filing any contemplated patent applications by March 15. This includes filing non-provisional patent applications, and in some cases Patent Cooperation Treaty (PCT) patent applications, that are based upon any provisional or non-U.S. patent application filed since March 2012. Though there are some exceptions to this advice, waiting until after March 15 may be problematic.

In brief: For patent applications having any claim with an effective filing date after March 15, it will no longer be possible to overcome prior art by showing an earlier date of invention. Thus, the prior art for purposes of patentability will include: 1) third-party public disclosures of any kind, anywhere in the world, prior to your effective filing date; and 2) issued U.S. patents and published U.S. or PCT patent applications that were effectively filed before your effective filing date. In addition to not being able to “swear behind” a prior art reference by proving an earlier date of invention, the prior art date for patents and published patent applications may be as much as 18 months earlier than under current law because of foreign priority claims.

It is also important to note that inventors will not lose the benefit of any earlier provisional or non-U.S. patent application should they wait until after March 15 to file. Any claims that are adequately supported in the earlier filing will be entitled to that earlier …

Federal Circuit: District Court Misfired When It Applied Second Circuit Law To Injunctive Relief Test In Patent Infringement Case

The recently decided Revision Military case is important when either moving for a preliminary injunction or defending against such a motion in a patent-infringement suit because it makes clear that Federal Circuit law governs the application of the four-factor injunctive relief test. When the United States Court of Appeals for the Federal Circuit rules on an appeal from a district court in a patent-infringement case, the Federal Circuit applies its precedent on substantive matters involving patent law but applies the law of the circuit where the district court is located for procedural matters not involving patent law. For example, in an appeal from a trial for patent infringement that occurred in the federal district court in Vermont, which is located in the Second Circuit Court of Appeals, the Federal Circuit would apply its precedent to substantive questions related to patent-law issues but would apply Second Circuit law on procedural or evidentiary questions not unique to patent law – e.g., was testimony properly excluded at trial because it constituted inadmissible hearsay. In a recent decision, the Federal Circuit held in Revision Military, Inc. v. Balboa Manufacturing Company, that when determining whether to grant a preliminary injunction, district courts must apply Federal Circuit law to determine whether the plaintiff satisfied the traditional four-factor test used to determine whether an injunction should issue.

Revision Military and Balboa Manufacturing both design, manufacture, and sell protective eyewear, such as glasses and goggles, for those using firearms. Revision brought suit against Balboa, alleging that the …

Part Two of a Two Part Series: Preemptive Strikes Against a Competitor’s Patent Application Preissuance Submissions by Third Parties During Patent Examination

In this Part Two of my series on this topic I’ll take a look at the benefits and risks of the preissuance submission.

As you recall, we covered the results of recent changes to U.S. patent law by the Leahy-Smith America Invents Act ("AIA") that make it more feasible to prevent the issuance of a competitor’s patent (or at least narrow its scope). Not only do third parties have more time to submit prior art (and other relevant information), they can also assist the patent examiner by commenting on the relevance of the submitted information. While these changes make preissuance submissions more appealing, there are still important risks to consider before submitting prior art against a competitor’s patent application.

The Benefits of Preissuance Submissions Third party preissuance submissions are certainly more attractive and useful in light of the AIA as well as recently-implemented Patent Office rules. For one thing, preissuance submissions are relatively inexpensive compared to challenging the validity of an issued patent, either at the Patent Office or in litigation in federal court. A fee of $180 is required for every 10 items submitted, and no fee is required for a first submission of no more than three items. Also, while the concise description of relevance for each item should be carefully drafted, there is only so much one can say without crossing the gray line between description and argument.…

Part One of a Two Part Series: Preemptive Strikes Against a Competitor’s Patent Application Preissuance Submissions by Third Parties During Patent Examination

As a result of recent changes to U.S. patent law by the Leahy-Smith America Invents Act ("AIA"), preventing the issuance of a competitor’s patent (or at least narrowing its scope) is more feasible. Not only do third parties now have more time to submit prior art and other relevant information, they can also assist the patent examiner by commenting on the relevance of the submitted information. While these changes make preissuance submissions more appealing, there are still important risks to consider before submitting prior art against a competitor’s patent application.

Preissuance Submissions Prior to the AIA The prosecution (i.e., examination) of patent applications in the U.S. has historically been, and still is, an ex parte proceeding involving only the applicant and the patent examiner. Nevertheless, even prior to the AIA, third parties were permitted to submit patents and other publications relevant to the examination of a pending patent application; however, such submissions were rarely made for a number of reasons.…

Prioritized Examination: Good News for Those That Need Quick U.S. Patents

One of our clients recently received a notice of allowance from the USPTO after only six months of filing and should receive an issued U.S. utility patent within eight months of filing. For those of you familiar with the U.S. patent system and accustomed to waits of 3, 4, 5 or more years to obtain a patent, this may sound impossible. However, it is now possible due to prioritized examination (sometimes referred to as Track One examination) that was implemented by the USPTO late last year. See our earlier blog entry.…

Prioritized Examination of Patent Applications Under Leahy-Smith America Invents Act

The Leahy-Smith America Invents Act ("AIA") was enacted on September 16, 2011. The changes implemented by this Act are wide-ranging and significant, and different provisions have different effective dates, with many taking effect September 26, 2011, September 16, 2012, or March 16, 2013. We will be providing additional information in the coming weeks and months.…

Discovering Ensnarement

Ensnarement is a powerful defense in any patent case where the doctrine of equivalents is at issue.  It’s time for defendants to “discover” this under-utilized defense.    Despite litigating numerous doctrine of equivalents cases, I’ve only litigated one case where an ensnarement defense was vigorously asserted.

Ensnarement, seminally set forth in Wilson Sporting Goods, prevents a patentee from claiming a range of equivalents that “ensnares” the prior art.  To make that determination, the original claim is redrafted as a hypothetical claim by replacing certain claim terms with the asserted equivalents.  As a result, the hypothetical claim literally encompasses the claimed product.  In DePuy v. Medtronic, e.g., the claim term “spherically-shaped portion” was replaced with “conically-shaped portion” in the hypothetical claim because the accused product included a conically-shaped portion.  The relevant question is then whether the hypothetical claim is allowable over the asserted prior art.  If the hypothetical claim is not allowable, then there is no infringement because the asserted range of equivalents “ensnares” the prior art.

Two features of ensnarement make the defense particularly powerful.   First, ensnarement is a question of law.   In DePuy, the district court held a separate bench trial on the issue of ensnarement after the jury trial (See DePuy, 526 F.Supp.2d 126).  The Federal Circuit affirmed the propriety of the court’s ensnarement proceeding, holding that ensnarement is a question of law like any other limitation on the doctrine of equivalents.  Second, the defendant merely bears the burden of producing prior art to challenge the hypothetical …

Best Mode Requirements Apply To Each Inventor

A decision issued by the Federal Circuit April 29, 2011 offers a lesson for patent prosecutors to talk to each named inventor about what they consider to be the best way of practicing their invention.  Though anti-intuitive, it is possible to have multiple best modes. In Wellman, Inc. v. Eastman Chemical Co. (Fed. Cir. 2011), the Federal Circuit has held that the best mode requirement of 35 U.S.C §112 applies to each named inventor (as opposed the inventors collectively).  The statutory language on this point is less then clear as §112 requires disclosure of the best mode “contemplated by the inventor.”  The issue is whether “the inventor” refers to a single best mode contemplated by all the named inventors or whether “the inventor” refers to each and every inventor, thereby allowing for the possibility of multiple best modes for a patent.  In addition, the term “best mode” suggests only one mode per patent.   Up to this point, Federal Circuit precedent was also unclear on the issue.  The only Federal Circuit decision addressing this issue supported the latter position, but did so in dicta in a footnote.  See Pannu v. Iolab Corp., 155 F.3d 1344, 1351 n.5 (Fed. Cir. 1998).   However, multiple Federal Circuit decisions have used loose language that supports the former position, though those decisions weren’t presented squarely with the issue.

In Eastman, the Federal Circuit adopted the dicta in Pannu and held that “best mode issues can arise if any inventor fails to disclose the best mode known …

New Fast Track Examination at the USPTO

Beginning May 4, 2011, a US patent applicant can request prioritized or "fast track" examination at the USPTO under the newly promulgated "Track 1" procedure of 37 C.F.R. 1.102(e). To obtain the Track 1 prioritized examination, the following conditions must be met when the application is filed: (1) the application must be an original utility or plant non-provisional application (i.e., this procedure is not available for international national stage entry applications, design applications, reissue applications, provisional applications, or reexamination proceedings, but is available for continuation and divisional applications, including a continuation application of an international application designating the US); (2) the application must be filed with an executed inventor oath or declaration and all applicable filing and publication fees; (3) the application must not contain more than four independent claims, more than thirty total claims, or any multiple dependent claims; and (4) a request for prioritized examination must be filed together with a $4000 filing fee and a $130 processing fee. Currently, there is no reduction in the $4000 fee for small entity applicants.

The USPTO indicates that it will only grant a maximum of 10,000 application requests for prioritized examination in fiscal year 2011, which concludes September 30, 2011.

Once an application is granted the prioritized status, the application will be placed on the examiner’s special docket throughout its course of prosecution until a final disposition is issued. A “final disposition” is defined to mean (1) mailing of a notice of allowance; (2) mailing of a final Office action; (3) …

Is Patent Reform Finally On Its Way?

There was much excitement when the U.S. Senate overwhelmingly passed (95–5) the America Invents Act (formerly titled the Patent Reform Act of 2011) (S.23 or AIA), on March 8, 2011. The America Invents Act  This legislation represents a major patent reform initiative that has been under congressional debate for at least six years and is quite possibly the most significant patent reform since the 1952 Patent Act. This legislation rewrites, among many other things, who is entitled to a patent when two or more entities seek protection for the same invention, when prior art is available for novelty and nonobviousness determinations, and what is available to a third party who wants to oppose a patent.

First-to-File: When two or more entities seek patents for the same invention, current law awards the patent to the entity that can prove it was the first to invent. Under the AIA, the patent would be awarded to the first-to-file a patent application. Proponents argue that this is more efficient because it eliminates costly and time consuming procedures called interferences and aligns U.S. law with other industrialized countries. Opponents argue that this favors large companies over small companies and independent inventors who do not have the resources to win a race to the patent office. To somewhat address these concerns, the AIA allows for a derivation claim (either in court or the Patent Office) when the first-filer “derived” their claimed invention from the other. Even with these derivation claims, however, the AIA appears to favor large companies who are active in patenting innovations.

 …

False Marking Qui Tam Provision Found Unconstitutional

As has been widely reported, there has been an influx of false marking cases hitting the courts over the past year based on 34 U.S.C. Section 292, the False Marking Statute.  That statute, loosely translated, makes it an offense to mark a product or use in advertising a  patent number or the words "patent," "patent pending," or any other indication that a patent applies to a product when it in fact does not.  This includes situations in which a company for years correctly marked a product with a patent number, but then continued so marking the product after the expiration of the patent.  The statute states that a person responsible for such an offense shall be fined not more than $500 for every such offense. 

The statutory language also includes a somewhat uniquely simplistic qui tam provision providing that "Any person may sue for the penalty, in which event one-half shall go to the person suing and the other to the use of the United States."  While the qui tam provision of the False Marking Statute was enacted in 1952, the 2009 Forest Group , Inc. v. Bon Tool Company decision made the qui tam actions more financially lucrative—and set the groundwork for a cottage industry of false marking litigation—by holding that violators of the False Marking Statute face a $500 fine for each article improperly marked rather than a $500 fine for a single decision to improperly mark multiple articles. 

The February 23, 2011 decision in Unique

Written Description and Enablement Separate Requirements

On March 22, in Ariad Pharmaceuticals v. Eli Lilly & Co., No. 2008-1248, an en banc panel of the U.S. Court of Appeals for the Federal Circuit reaffirmed that § 112, ¶ 1 contains a written description requirement that is separate and distinct from the enablement requirement. The court ruled that the asserted claims of U.S. Patent No. 6,410,516 (the ‘516 patent) are invalid for failure to meet the statutory written description requirement.…

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