Patent Law Blog (Patently-O)

Patent Office to Allow Examiners to Make Foreign Prosecution History of Record in Domestic Applications

The USPTO is considering whether to expand its tri-lateral (US, EPO, Japan) document sharing procedures to permit examiners to import published documents donor offices into the application file of the recipient office.

For example, a USPTO examiner could import a reference cited as prior art in the file of a published foreign application into the USPTO file.

These imported files would become part of the official prosecution history.  The PTO would, for now, restrict importation to (i) filed application; (ii) listing of cited references; (iii) available reference copies; and (iv) search reports without examiner comments.

Comments should be directed to Mark Powell (mark.powell@uspto.gov) and Jay Lucas (jay.lucas@uspto.gov). You may also leave your comments below.

Read the notice.

Supreme Court: FTC confronts decision that liberally allows brand-generic patent settlements

FTC v. Schering-Plough (on Petition for Cert).

After losing at the 11th Circuit, the FTC has filed a petition for certiorari asking the Supreme Court to hear its appeal.  In a March 2005 decision, the 11th Circuit Court of Appeals set aside an FTC order that barred Schering-Plough from settling an infringement suit with generic makers regarding the patented blood pressure drug K-Dur.  The FTC had concluded that the settlement was an "unreasonable restraint of trade."  The 11th Circuit, however, disagreed, finding that payment from a patent holder to a generic competitor cannot be the sole basis of a violation of antitrust law. Accordingly, the court SET ASIDE the decision of the Federal Trade Commission and VACATED its cease and desist order.

In its petition for certiorari, the FTC presents two questions to the Court:

1. Whether an agreement between a pharmaceutical patent holder and a would-be generic competitor, in which the patent holder makes a substantial payment to the challenger for the purpose of delaying the challenger’s entry into the market, is an unreasonable restraint of trade.

2. Whether the court of appeals grossly misapplied the pertinent “substantial evidence” standard of review, by summarily rejecting the extensive factual findings of an expert federal agency regarding matters within its purview.

In its supporting brief, the FTC argues that agreements between competitors should not be per se lawful simply because they are within the “potential” reach of a patent claim. The Public Patent Foundation (PubPat) supported the FTC at the Eleventh Circuit and will likely file an Amici Brief in support of the FTC’s petition.

Links:

• File Attachment: FTC Petition for Cert (182 KB)
• FTC petition for Rehearing at the 11th Circuit
• Schering 11th Circuit Decision.pdf
• Patent at issue, No. 4,863,743
• NYTimes Article
• PubPat Amicus Brief to the 11th Circuit [pdf]
• Patently-O Article I
• Patently-O Article II

Million Dollar Patent

In patent prosecution, the Patent Office fees are usually quite low when compared to the cost of hiring a patent attorney.  I’m predicting that the usual equation is not quite true for Angiotech International who was recently asked to pay $1.25 Million in application filing fees for a patent application having about 10,000 claims.  (File Attachment: Fee Due.pdf). 

As would be expected, the patentee quickly submitted an amended specification that cut the disclosure to three independent claims and 96 dependent ones — thus reducing its PTO bill to only two grand.

As Greg Aharonian noted, it is lucky that the applicant was a small entity — otherwise the fee would have been over $2,000,000. (Published Application)

Links:

• Brandon Rash’s Coverage (File History)
• Sander Gelsing’s Coverage (Noting that the Canadian filing fee would have been just $200).

BPAI: No Motivation to Combine Because Neither Cited Reference Recognized Advantages Discussed in Application

Ex parte Gottling (B.P.A.I. 2005) (unpublished).

Gottling successfully appealed an Examiner’s rejection based on his argument that there was no motivation for combining the cited prior art references within the references themselves.

Obviousness cannot be established by combining prior art to produce the claimed invention absent some teaching or suggestion supporting the combination.  The mere fact that the prior art may be modified in the manner suggested by an examiner does not make the modification obvious unless the prior art suggested the desirability of the modification.

In this case, the Board found that the Examiner had not explained “why a person of ordinary skill in the art would have found it obvious” to combine the references in the manner proposed by the Examiner.” In particular, the Board noted that neither reference specifically recognized the advantages discussed in Gottling’s application.

KSR v. Teleflex, now before the Supreme Court asks the court to review the “teaching-suggestion-motivation test” that was the basis of the Gottling decision.  

StopFakes Small Business Initiative.

With its new leadership corps, the USPTO is moving forward with a number of initiatives to address the concerns of patent holders, businesses, and the public.

A major project launched last fall is the anti-counterfeit program StopFakes! (www.stopfakes.gov).  Now, the PTO has created a small business focused initiative to “help small business owners protect their intellectual property from overseas piracy and counterfeiting.  Information on the new small business initiative is available online here: www.uspto.gov/smallbusiness.

Patently-O Tidbits

• PATPROS: Link. Scott Kamholz at Foley Hoag has created a nice reference page for patent prosecution. Foley Hoag is also home of TTABlog author John Welch.
• USPTO RSS FEEDS: Link. The attorney-bloggers at Rethink(IP)  have developed a great set of RSS feeds that provide USPTO news updates straight from the PTO website.  
• GUESTMAP: I have installed a new Patently-O GUESTMAP  Feel free to leave your mark.
• SUMMER ASSOCIATES: Friday is the last day for my firm’s summer associate program.  I was able to get several of the summers involved with the blog.  Thanks Paul Kafadar, Cory Hojka, Nicole Lammers (TBA), Rebecca Brown, and Jessica Lunney! Our firm is always looking for talented technocrats who can communicate well and have an interest in patent law.
• PAPER TOPICS: Link. Pittsburgh Professor Michael J. Madison has posted a list of interesting topics for IP papers.
• FILE HISTORIES: A Patently-O Reader is looking for the filewrappers for Patent Nos. 5,894,554 and 6,415,335.  These are reportedly being asserted by a company called EpicRealm (Story).  Let me know if you have them.
• EXPERIMENTAL USE: In a newly published paper in the Federal Circuit Bar Journal, Professor Hal Wegner argues that the U.S. should have a clear experimental use defense that would allow experimentation on a patented invention.

Thanks for reading! (crouch@mbhb.com)

 

 

Interference only declared once examination is complete

Westbrook v. Gray, 75 U.S.P.Q.2d 1607 (BPAI) (UNPUBLISHED).

In a short decision, the Patent Board confirmed that “examination must be complete in an application before an interference involving that application is initiated.”

Applicant Gray filed a petition with the Board asking for guidance as to whether it should file a motion suggesting the declaration of an interference. Finding that examination of the application had not been completed, the Board held that an interference would be premature.

Under MPEP 2301.01, before a claim should be “considered as the basis for the count of an interference, the claim should be allowable and in good form.”

Federal Circuit Broadly Interprets Copyright Safe Harbor for Computer Repair

Storagetek v. Custom Hardware Engineering (Fed. Cir. 2005)

Normally, the unauthorized duplication of computer software violates the exclusive right of the copyright holder.  Section 117(c) of the Copyright Act, however, authorizes the copying of a computer program for purposes of maintaining or repairing a machine if the “copy is made solely by the virtue of activation of [that] machine”. 

In a case of first impression, the Federal Circuit addresses the extent of this protection offered by 17 U.S.C. § 117(c). The Court of Appeals, relying on definitions in 17 U.S.C. § 117(d), held that § 117(c) protects maintenance and repair as two different activities. “Repair,” according to the Federal Circuit, is restoring a broken machine to its original specifications. “Maintenance,” on the other hand, has “a much broader temporal connotation” that “encompass[es] monitoring systems for problems [and] not simply fixing a single, isolated malfunction.” Thus, the Federal Circuit found erroneous the district court’s conclusion that only repair activities are protected under Sec. 117(c).

Furthermore, the Court of Appeals also found DMCA provisions likely not applicable. Circumvention of a technological measure providing access to a copyrighted work is not a violation of DMCA, according to the Federal Circuit, unless it “infringes or facilitates infringing a right protected by the Copyright Act.” Finally, the Court of Appeals did not agree, based on material factors, that the copyrighted work in question should receive trade secret protection.

The Federal Circuit thus vacated the district court’s grant of a preliminary injunction to Storage Technology and remanded for further proceedings. Judge Rader, in dissent, decried the majority’s decision as “destroy[ing] copyright protection for software that continually monitors computing machine behavior.”

NOTE: This post was written by Cory Hojka. Mr. Hojka is a law clerk at MBHB and a student at the University of Chicago Law School.

Silicon Wafer Technology: Reasonable Jury Could Find Inducement

MEMC Electronic Materials v. Mitsubishi Materials (Fed. Cir. 2005).

MEMC sued Mitsubishi for infringement of its patent directed to the preparation of high quality single crystal silicon for the semiconductor industry. The district court dismissed the claims on summary judgment — finding no evidence of infringement or inducement.

On appeal, the CAFC affirmed the rejection of the direct infringement claim, but reversed on inducement.  The panel found that the defendant (i) knew of the alleged direct infringer’s activities; (ii) provided technical support to the alleged direct infringer via e-mail; (iii) sent a shipment to the alleged direct infringer to address technical problems; (iv) visited the alleged direct infringer’s site to provide further technical support; and (v) knowledge of the patent itself. This record swayed the CAFC to reverse the district court’s holding that “a reasonable jury could not find intent to induce infringement.”

Specifically, the CAFC noted the series of e-mails provide “sufficient circumstantial evidence . . . that SUMCO intended to encourage those [potentially infringing] activities.”

File Attachment: MEMC Decision (104 KB)

As Cathy Kirkman notes in her excellent Silicon Valley Media Law Blog, the CAFC drew a parallel with the the recent Supreme Court Grokster copyright inducement opinion.  Quoting Grokster, the appellate court held that evidence such as “advertising an infringing use or instructing how to engage in an infringing use, show an affirmative intent that the product be used to infringe.”

Prosecution History Gets Little Weight In Claim Construction

AquaTex v. Techniche (Fed. Cir. 2005).

AquaTex appealed a summary judgment of noninfringement arguing that the district court had improperly applied prosecution history estoppel to limit use of the doctrine of equivalents.

On appeal, the CAFC “decline[d] to give the prosecution history much weight.”  In its decision the Court quoted Phillips for the conclusion that the prosecution history is an ongoing negotiation that “often lacks the clarity of the specification and thus is less useful for claim construction.”  Although the CAFC disagreed with the lower court’s basis of decision, ultimately, the panel affirmed the claim construction.

Regarding the doctrine of equivalents, the CAFC could not find the requisite “clear and unmistakable surrender of subject matter required to invoke argument-based prosecution history estoppel.”

Affirmed-in-part, Reversed-in-part. 

CAFC Refuses To Find Estoppel Based On Arguments Before The EPO

Tap Pharmaceutical v. OWL Pharmaceuticals (Fed. Cir. 2005).

In an action for infringement of several pharmaceutical patents, the Federal Circuit upheld the district court's findings that the generic drug-maker (OWL) had infringed two of the plaintiffs' (Tap et al) patents.

Broad Scope Derived from Specification: Claims which described the patented compound as "comprising a copolymer … of lactic acid and … of glycolic acid" were interpreted by the appellate panel to also encompass copolymers "produced by any method."  Although the specification only provided examples of copolymers made from lactic and glycolic acid, it did note that the polymer "may be produced by any method." 

Disclaimer Based On Foreign Prosecution: Regarding foreign prosecution history, the CAFC gave little weight to statements made by the patentee to an Examiner in the European Patent Office that the invention did not include compounds made from lactide or glycolide.  The European Examiner had rejected the claims after this argument was made, finding that the compounds which the patentee had attempted to disclaim were not different from those made from lactic and glycolic acid.  Therefore, because the European claims were later allowed on other grounds, and because the patentee had not made this argument before the USPTO, the patentee must have "receded from that characterization of the claims," and thus these statements should be given little weight in the process of claim construction.

Even Common Words Construed According To Specification: A second claim directed to "particles containing a water-soluble drug" was interpreted to encompass only particles which included both 1) the drug substance, and 2) a drug-retaining substance, because the drug-retaining substance was included in all the examples in the specification and was listed as a benefit of the invention.  The court held that the term "containing," while not a technical term, helped to describe the patented technology and therefore "cannot be defined by some ordinary meaning isolated from the proper context."  Thus, the district court was correct to look to both intrinsic and extrinsic evidence to properly interpret the claim.

The Federal Circuit thus affirmed the district court's claim construction as to both patents.

NOTE: This post was written by Rebecca Brown.  Ms. Brown is a law clerk at MBHB and a student at Northwestern University School of Law.

• As Attorney Jason Rantanen pointed out in a recent e-mail, there is a clear distinction between the prosecution history disclaimer and prosecution history estoppel.  The disclaimer doctrine is related to “claim construction for the purposes of literal infringement” while the estoppel doctrine bars the assertion of DOE under Festo.

CAFC: Continuation Application Need Not Claim Priority to PCT Application

Broadcast Innovation v. Charter Communications (Fed. Cir. 2005).

The district court found Broadcast’s patent to be anticipated because its priority date was more than one year after the publication of an Australia PCT application on the same subject matter filed by the same parties.  The asserted patent failed to claim a specific reference to the PCT application, but did claim priority to a U.S. application that, in turn, claimed priority to an earlier PCT filing.

On appeal, the CAFC determined that the district court had applied the wrong priority date to the asserted patent — finding that the chain of priority was sufficient to fall within the requirements of 35 U.S.C. 120.

[T]he applicant filed the [US priority application] on July 18, 1995, as the U.S. national stage application of the original PCT application. However, July 18, 1995 is not the "U.S. filing date" of the [US priority application]. Specifically, under 35 U.S.C. § 363, the international filing date of a PCT application is also the U.S. filing date for the corresponding national stage application.

Thus, the court clarified that Section 120’s reference to a later filed application having “the same effect . . . as though filed on the date of the prior application” means that the later application will be treated as having the effective filing date of the prior application.

NonProfit Sues Drug Maker for False Marking

Patients Not Patents v. Medimpex United (Dist. D.C. 2005).

Under Section 292 of the Patent Act, “[a]ny person may sue” a party that falsely marks a product as “patented” or “patent pending.”  In such cases, the fine is limited to $500 per offense.

In a court filing on Tuesday, August 16, 2005, a D.C. nonprofit known as “Patients not Patents, Inc.” filed a Section 292 complaint against Medimpex United, maker of Xalex Weight Management Gel.

The complaint, signed by PNP’s director Jeffrey Light, alleges that Medimpex’s products have been falsely marked as “patented” and sold through various marketing channels, including a list of internet retailers.

There is little precedent on Section 292, however, in the recent Clontech case, the Federal Circuit determined that the statute requires patentees have a good faith believe that the marked article falls within the subject matter of the patent.  According to the CAFC, marking must be reliable in order to permit free and fair competition and commerce. In an e-mail, Light commented that this statute provides a way of “linking patent issues to consumer protections.”

Links:

• File Attachment: Patents Not Patients Complaint.pdf (184 KB);
• Clontech Laboratories v. Invitrogen Corp. (Fed. Cir. 2005);

Patent Reform Act of 2005

The Patent Reform Act of 2005 is changing as it moves through congress.  In the latest amendment, Representative Smith has eliminated some of the most controversial aspects of the bill, including the injunction provision and the provision that would limit the scope of claims in continuing applications.

The reform measures still include a move to first-to-file; changes to the duty of candor; limitations on infringement and willfulness damages; post grant opposition procedures; and a revised venue statue.

Links:

• Newly Amended Patent Reform Act of 2005;
• Redline version of the Amended Version (by K. Karel Lambert) *NOTE I have not reviewed this redlined version;
• Promote-the-Progress Patent Reform Library.

 

CAFC takes a new look at "rear end" definition

Research Plastics v. Federal Packaging (Fed. Cir. 2005).

In a dispute over caulking tubes, Research appealed a district court judgment of non-infringement — arguing that the lower court had erred in its claim construction.

Claim construction centered on the claim term “rear end.” Referencing only intrinsic evidence, the CAFC determined that the lower court had erred slightly in its definition of the term — finding that the prosecution history provided substantial support for defining the rear end as the “point defined by the rear edge of the tube.”  On remand, the district court must reconsider literal infringement in light of the new construction.

Regarding the Doctrine of Equivalents, the Court found that Research had disclaimed equivalents to a ribbed nozzle by amending the claims to overcome a cited reference. Thus, under Festo, that scope cannot be recaptured as an equivalent to the claimed invention.

File Attachment: Decision.pdf (78 KB)

PTO Fee Diversion is Constitutional

Figueroa v. United States (Ct. Fed. Clms. 2005).

 

In Figueroa, the plaintiff challenged Congress’ diversion of USPTO fee revenue to non IP government programs as an illegal exaction and unconstitutional.  Specifically, the plaintiff argued that because the diversion interfered with the USPTO’s performance and burdened inventors with costs unrelated to securing patent rights, it was “not rationally related to promoting the progress of the useful arts, as required by the Constitution.”

 

The Court disagreed, and held that the diversion was not unconstitutional.  It applied a rational basis test, which required the plaintiff to prove that the diversion of fees was not “rationally related to legitimate governmental objectives.” 

 

Relying on Eldred v. Ashcroft, the Court noted that IP policy judgments “are vested in Congress, and courts must be deferential to Congress’ exercise of its power in that sphere.”  It pointed out that under current USPTO appropriations legislation, the USPTO has continued to grow and its appropriations have increased.  Therefore, it concluded that “Congress’ determination of federal spending priorities and how the patent system fits into national economic development goals is an eminently rational exercise of that power.”

NOTE: This post was written by Paul Kafadar.  Paul is a law clerk at MBHB and a law student at Northwestern University in Chicago.

Links:

• Prior discussion of Figueroa.
• Information on the case from the prosecuting lawyer.
• Nipper’s discussion of the case.
• AIPLA amicus brief supporting Figueroa.

TiVo Wins Patent Case On Appeal

TiVo v. Pause (Fed. Cir. 2005).

In a patent infringement action, the district court had granted summary judgment to the defendant TiVo — finding that certain TiVo products did not infringe Pause’s reissued patent.  On appeal, Pause challenged the district court’s claim construction rulings as erroneously defining the limitations “circular storage buffer” and “time interval of predetermined duration”.  In support of its position, Pause argued, inter alia, that (i) the lower court’s interpretation of a “circular storage buffer” limitation should not depend on other language appearing later in the claim and (ii) the language employed by the district court in construing the limitations was not present within the claim and, thereby, led to impermissible narrowing of the claim’s scope.

The Federal Circuit, relying in part on Phillips v. AWH, rejected the first argument as “[p]roper claim construction . . . demands interpretation of the entire claim in context, not a single element in isolation.” Additionally, the Federal Circuit further found that Pause’s second argument was inconsistent with the prosecution history and the language present elsewhere in the claim and in the specification. 

The Federal Circuit affirmed — finding no error in either claim construction or infringement analysis.

NOTE: This post was written by Cory Hojka. Mr. Hojka is a law clerk at MBHB and a student at the University of Chicago Law School.

File Attachment: CAFC Decision.pdf (77 KB)

On Remand, Federal Circuit to Rehear Integra Appeal

Integra Lifesciences v. Merck KGaA (Fed. Cir. 2005) (Order).

On remand from the Supreme Court, the CAFC has reinstated the Integra’s appeal and ordered the parties to re-brief the case based on the Supreme Court's recent decision.

In a nutshell, the Supreme Court found that Section 271(e)(1) of the Patent Act provides a safe harbor that protects would-be infringers from liability for “all uses of patented inventions that are reasonably related to the development and submission of any information under the FDCA.”

Links:

• Federal Circuit’s August 17 Order;
• Supreme Court Decision;
• Discussion of the Supreme Court Decision;

 

Claim Construction: Specification is Always Highly Relevant

Terlep v. Brinkman Corp (Fed. Cir. 2005).

Stephen Terlep sued Brinkman, Wal-Mart, and Home Depot for infringement of his patent directed to an omni-directional LED.  After construing the claims, the Arkansas federal court granted summary judgment of noninfringement based on the accused products failure to have a “clear plastic tubular holder” as claimed.

On appeal, the Federal Circuit affirmed, finding that the court’s claim construction methods were appropriate under Phillips v. AWH.

In Phillips, the CAFC determined that the specification of a patent is “always highly relevant to the claim construction analysis. Usually, it is dispositive.”  

To apply Phillips, the court analyzed each use of the term “clear” in the claims, specification, and prosecution and came to the conclusion that the district court had appropriately excluded “translucent” from the term’s definition.

Dictionaries: The CAFC went on to find that the district court’s use of dictionary definitions to support its finding from the written description was an appropriate use of the extrinsic evidence.

File Attachment: 04-1337.pdf (57 KB)

Illinois Tool Works: Patents and Unlawful Tying

Illinois Tool Works v. Independent Ink (Supreme Court 2005). 

On appeal to the Supreme Court is the question of whether market power must be proven in a Section 1 Sherman Act case that alleges the tying of a non-patented product to the sale of a patented product.  In its opinion in the case, Court of Appeals for the Federal Circuit determined that a rebuttable presumption of market power sufficient to restrain trade under antitrust law arises from the patentee’s possession of a patent used in an explicit tying agreement.  Oral arguments are scheduled for Tuesday, November 29, 2005.

Briefing is ongoing, but a number of parties have filed as amici. 

• In Support of Petitioner
• U.S. Government Brief
• IPO Brief
• MPAA Brief
• NYIPLA Brief
• IPLAC Brief
• In Support of Respondent
• (Not yet due).

REVIEWS:

Amicus Brief of the U.S Government:

The government makes the powerful argument that there is “no economic basis” for inferring market power from the “mere fact” that the defendant holds a patent.  The relevant market would rarely have the same boundaries as the legal scope of the patent — as such, the per se approach is not warranted.  Both the DOJ and FTC have a policy against applying a presumption of market power based on the existence of a patent. Download the U.S. Government Brief.

Brief of the IPO:

The Intellectual Property Owners Association agreed with the Government Brief that there was a lack of economic rational for a per se presumption of market power.  In addition, the IPO argued that the presumption makes it too easy for defendants in patent infringement suits to file baseless antitrust counterclaims.  Notably, the IPO questions the basic premise that tying is competitive by citing a number of academic articles (Bakos) that provide evidence of the pro-consumer effects of tying agreements. File Attachment: IPOTyingBrief.pdf (1099 KB).

Amicus Brief of the MPAA

The Motion Picture Association of America and several other organizations filed a joint brief in support of the petitioner.  The MPAA makes the argument that Loew’s does not set a rule of “presuming antitrust market power from intellectual property ownership.”  The MPAA is a heavy copyright holder, but certainly realizes that the Supreme Court often generalizes across traditional IP categories with its analysis. File Attachment: Illinois Tool MPAA Amicus Brief.pdf (345 KB).

Brief of the NYIPLA:

In its support of the petitioner, the NY IP Law Association (David Ryan, et al.) took the novel position that Section 271(d)(5) of the Patent Act exempts tying. Section 271–(d)(5) provides that:

No patent owner . . . shall be denied relief or deemed guilty of misuse or illegal extension of the patent right by reason of his having . . . (5) conditioned the license of any rights to the patent or the sale of the patented product on the acquisition of a license to rights in another patent or purchase of a separate product, unless, in view of the circumstances, the patent owner has market power in the relevant market for the patent or patented product on which the license or sale is conditioned.

The NYIPLA thus argues that the plain language of the statute encompasses tying and requires a specific showing of market power — thus eliminating the per se approach.  File Attachment: NYIPLABrf.pdf (318 KB).

Amicus Brief of the IPLAC:

The Intellectual Property Law Association of Chicago analyzed the parallels between this case and Jefferson Parish — making the argument that the only notable difference between the two cases being the fact that a portion of the tying product is patented. File Attachment: IPLACbrf.pdf (132 KB).

Patent Board Erred By Creating New Grounds For Rejection

In re Kumar (Fed. Cir. 2005)

Kumar et al. appealed the PTO Board of Patent Appeals and Interferences decision rejecting Kumar’s patent application claims on aluminum oxide particles as obvious under 35 U.S.C. Sec. 103.

The Board held the claims unpatentable based on calculations derived from U.S. Patent No. 5,389,194 (the Rostoker patent). These calculations were not performed by the examiner nor were they presented during the argument of the appeal to the Board. The Federal Circuit therefore concluded that these calculations represented new grounds for rejection by the Board. Since the Board had provided Kumar no opportunity to respond to these new grounds for rejection, the Federal Circuit also reversed and remanded the Board’s holding.

NOTE: This post was written by Cory Hojka.  Mr. Hojka is a law clerk at McDonnell Boehnen Hulbert & Berghoff LLP and a law student at the University of Chicago Law School in Hyde Park.

Federal Circuit: Nucleotide Sequence of Claimed DNA not Required to Satisfy Written Description Requirement

Capon v. Eshhar v. Dudas (Fed. Cir. 2005).

In an interference proceeding regarding a chimeric genes for cell-surface antibody production, the BPAI the claims of both applications after finding that they both failed to provide an adequate written descriptions as required by 35 U.S.C. 112. Particularly the Board found that the written description must include a listing of the specific nucleotide sequence of claimed DNA.

On appeal, the CAFC reversed, finding that the per se rule requiring recitation in the specification of the nucleotide sequence of the claimed DNA to be incorrect when the sequence is already known in the field.

The Board's rule that the nucleotide sequences of the chimeric genes must be fully presented, although the nucleotide sequences of the component DNA are known, is an inappropriate generalization. When the prior art includes the nucleotide information, precedent does not set a per se rule that the information must be determined afresh.

On remand, the CAFC asked the Board to further explore whether the applications include appropriate descriptions in light of what is known in the field.

Incomplete Written Analysis Results in Reversal of Summary Judgment

Warner-Lambert v. Teva Pharmaceuticals (Fed. Cir. 2005).

In a dispute over Warner-Lambert's control over its ACE inhibitor quinapril, the district court granted summary judgment of validity in Warner-Lambert's favor.  Teva appealed, arguing that the patent was not enabled.

On appeal, the CAFC reversed and remanded.  Specifically, the appellate panel questioned the district court's summary judgment opinion that lacked any analysis of the enablement issue:

At the outset, we find the issue of enablement difficult to review because the district court did not address it in its decision granting Warner-Lambert’s summary judgment motion. We have no way of knowing what the district court thought of Teva’s enablement defense or why the court did not address the issue in its decision. In short, we are being asked to review an incomplete record.

Based on the evidence presented by Teva and a lack of written justification for the district court judgment, the CAFC held that Teva should be given another opportunity to present its case.

CAFC Further Vitiates Doctrine of Equivalents

Freedman Seating v. American Seating (Fed. Cir. 2005).

Freedman was awarded summary judgment of infringement based on an analysis under the doctrine of equivalents.

Freedman’s patent covers technology for stowable bus seats that allow room for a wheelchair.  The claims include a limitation of a seat-base having a slidably mounted movable end. On appeal, American Seating argued that its rotatably mounted elements were not equivalent.

Agreeing with American, the CAFC reversed, holding that allowing DOE coverage of a rotatably mounted element would vitiate the claim language that required the element be slidably mounted.

[A]n element of an accused product or process is not, as a matter of law, equivalent to a limitation of the claimed invention if such a finding would entirely vitiate the limitation.

According to the panel, determining vitiation is done by considering “the totality of the circumstances in each case.”  Specifically, the court must determine whether the alleged equivalent can be fairly characterized as an insubstantial change from the claimed subject matter without rendering the pertinent limitation meaningless.

In this case, the court determined that the “slidably mounted” limitation excluded the possibility of DOE coverage of a “rotatably mounted” element.

Reversed.

Comment:

• DOE jurisprudence is becoming more confusing.  Every defendant now has an arguable vitiation position — since, by definition, the DOE is only applied against products that do something different than what is required by the claims.

Upcoming Conferences

Here are a couple of upcoming conferences that look interesting:

August 19, 2005 12:30 pm – 2:00 pm: AIPLA Advanced Patent Prosecution Online Seminar.

September 18–20, 2005: 42nd Annual Corporate Patent Seminar is being held in Chicago this year.  The Seminar is intended as a forum for discussion between senior in-house patent professionals.  I will be at the Seminar leading a session on controlling patent law information overload. File Attachment: CorpPatSeminar.pdf (26 KB)

Terminal Disclaimer Does Not Bind Two Patents For Purposes of Inequitable Conduct Unenforceability

Pharmacia v. Par Pharmaceuticals (Fed. Cir. 2005).

Inequitable conduct includes an intent to deceive coupled with either:

• Affirmative misrepresentation of a material fact
• Failure to disclose material information, or
• Submission of false material information.

In this case, the CAFC affirmed a district court’s finding of inequitable conduct based on the patentee’s failure to submit certain prior art articles to the PTO along with the filing of a declaration that contradicted the articles.  Intent was inferred by the materiality of the references and because one of the unsubmitted articles was co-authored by the declarant himself. 

Regarding a second patent in suit that was joined to the first by a terminal disclaimer, the CAFC found that the inequitable conduct during prosecution of in the first patent did not extend to the second.  Specifically, the appellate panel affirmed the conclusion that a terminal disclaimer alone does not bind two patents together for purposes of unenforceability due to inequitable conduct.

Patently-O Tidbits

• Antitrust: The U.S. Government has filed a brief in support of petitioner in the Illinois Tool Works case. The Government argues that the court “should not presume that a patent confers the market power necessary to establish that is unlawful per se.” File Attachment: Gov’t Brief (178 KB).
• Claim Construction: Last week, attorneys Kenneth Bass and Edward Manzo presented a discussion on the recent claim construction decision in Phillips v. AWH.  A pdf document outlining the decision was prepared by Mr. Manzo and is available here: File Attachment: Phillips En Banc.pdf (209 KB).
• Patent Reform: An amendment has been proposed to the Patent Act of 2005 that would alter the law on venue for patent infringement.  File Attachment: New Patent Act.doc (27 KB).
• Trademark: Link – Professor Goldman (Marquette) discusses the recent follow-up opinion in Geico v. Google holding that the use of a trademarked term in sidebar ads may create customer confusion in violation of the Lanham Act.
• In-House: Todd Mayover has a new blog discussing patent law from the perspective of an in-house counsel. http://ipcounsel.blogspot.com/.
• Hatch-Waxman: Philip Brooks points us to the Jeremy Burlow’s interesting paper on The Gaming of Pharmaceutical Patents [pdf].

Federal Circuit Makes it Hard to Waive Claim Construction Arguments

Harris Corp. v. Ericsson (Fed. Cir. 2005).

Harris owns the patent on a signal decoder that uses an estimator to compensate for transmission interference.  A jury found that Ericsson infringed the Harris patent.  Ericsson appealed — arguing for JMOL based on faulty claim construction.

On appeal, Ericsson asked the CAFC to take a fresh look at claim construction — arguing that the Means-Plus-Function term “time domain processing means” had been improperly interpreted in light of a case (WMS Gaming) that was decided at the Federal Circuit after the claim construction.  Harris, on the other hand, argued that Ericsson waived the WMS Gaming argument by failing to advance it at trial or object to the jury instructions.

Choice of law: The CAFC determined that waiver of a claim construction argument to be intimately associated with patent rights, and thus, that Federal Circuit law should apply to such questions.

Waiver Analysis: The CAFC found that it has “case-by-case discretion over whether to apply waiver” but that if Ericsson’s arguments on appeal was “the same concept” as that argued before the district court then there would be no waiver.  Following Gaus v. Conair. Because the appellate panel found Ericsson’s claim construction argument on appeal to be only a “slight change” from that argued at the district court and thus that there was no waiver.

Dissent: In a dissenting opinion, Judge Gajarsa argued that Ericsson’s argument on appeal was a complete “paradigm shift” from what it argued at trial and that Ericsson had at least “ten opportunities . . . to make its [new] claim construction arguments.”

Now, on appeal, Ericsson awakens to the benefit of WMS Gaming and argues for the first time that it controls. . . . The verdict of a jury will not ordinarily be set aside for error not brought to the attention of the trial court.”

Concluding with a policy analysis, Judge Gajarsa finds that the majority holding “improperly encourages parties to take their chances on a high stakes, potentially cost saving argument at trial, while proliferating new arguments on appeal. For various reasons this court already has a high reversal rate on claim construction issues, which tends to encourage appeals and, perhaps, discourage trial courts from heavily investing in claim constructions below. The court’s holding will only intensify this problem, and further distort the proper trial-appellate relationship regarding claim construction.”

Written Description Does Not Require Explicit Disclosure of Claim Terms

Ex parte Eggleston (B.P.A.I. 2005) (NOT PRECEDENT).

In an application involving a method of mobile communication, the examiner rejected the claims because the subject matter was not “described in the specification in such a way as to reasonably convey to one skilled in the relevant art that the inventor, at the time of the application was filed, had possession of the claimed invention.” Specifically, the examiner contended that an explicit limitation in the claims was not present in the written description.

The BPAI reversed the rejection, finding that the original disclosure provided adequate support.

We find that the original description, albeit in different language than is now claimed, would have conveyed to the artisan that the inventors had possession of the subject matter which they now claim at the time of filing the application.

In its decision, the Board affirmed the principle that an “explicit” disclosure of claim terms is not required under 35 U.S.C. § 112, first paragraph. “An invention claimed need not be described ipsis verbis in the specification in order to satisfy the disclosure requirements.

Follow Up:

• Ex parte Holt, 19 USPQ2d 1211 (BPAI 1991).
• File Attachment: Eggleston Decision (19 KB)

Claims definite unless "insolubly ambiguous."

Marley Mouldings v. Mikron Industries (Fed. Cir. 2005).

At summary judgment, the district court (N.D.Ill.) found Marley’s patent invalid for indefiniteness.  On appeal, the Court of Appeals for the Federal Circuit (CAFC) reversed, holding that the claims were not “insolubly ambiguous” and thus not indefinite under 35 U.S.C. 112.

Marley’s patent is directed to a method of forming a foam composite as a wood replacement.  The claims specify the volume of various materials use to create the composite.  The district court found the volume requirements to be indefinite because the specification did not include any means to calculate the percent volume — “a critical determination to discerning” infringement.

Mikron also argued that “measurement of components by weight, not by volume, is the standard practice in the field of polymer processing, and [thus,]that the patentee's failure to conform to this practice is further support for the indefiniteness of the claims.”

The CAFC disagreed, finding that “non-conformity is not of itself indefiniteness.”

We conclude that the district court erred in law, in requiring that the specification describe the relationship between volume and weight of the wood filler used or usable in the process. When a claim "is not insolubly ambiguous, it is not invalid for indefiniteness." (quoting Bancorp Servs, 359 F.3d 1367).

Remanded.

NOTES:

• This case attempts to distinguish Honeywell v. ITC, 341 F.3d 1332, 1339-40 (Fed. Cir. 2003) (claim indefinite because yarn melting parameter included without stating which of four known methods of preparing and testing the yarn should be used).

Aesthetically Pleasing Patent Found Indefinite

Datamize v. Plumtree Software (Fed. Cir. 2005)

The CAFC has affirmed a district court's summary judgment of invalidity -- finding that the claim term "aesthetically pleasing" to be indefinite under the second paragraph of 35 U.S.C. § 112.

Section 112 provides that the "specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention." 

Generally, the court warns against applying the indefiniteness provision to invalidate a patent.

If the meaning of the claim is discernible, even though the task may be formidable and the conclusion may be one over which reasonable persons will disagree, we have held the claim sufficiently clear to avoid invalidity on indefiniteness grounds.

However, the Appellate Panel found that Datamize's arguments "fail to persuade [the Court] that 'aesthetically pleasing' can be given any reasonable meaning.

Affirmed -- “Aesthetically pleasing,” as used in the independent claim, fails to “particularly point out and distinctly claim the subject matter which the patentee regards as his invention.

Customary Meaning Refers to Customary Meaning in the Art

Collegent v. ApplyYourself (Fed. Cir. 2005).

In one of the first claim construction cases following the landmark Phillips v. AWH case, the CAFC has reversed a district court's construction of the phrase "a format specified by the institution."  In its decision, the panel cited Phillips for the proposition that the lower court had improperly given the term an overly broad customary meaning.  Id. ("‘customary meaning’ refers to the ‘customary meaning in [the] art field’").

NOTE: This week I have been on vacation at our family ranch in Kansas and blogging through my TREO.  Sorry for the typos.

InterDigital v. Nokia: Intervention Improper if Filed After Settlement

Ericsson v. InterDigital v. Nokia (Fed. Cir. 2005).

Ericsson sued InterDigital for a declaratory judgment that InterDigital's group of digital wireless telephone patents are invalid and/or unenforceable. After a decade of litigation, the parties settled in 2003 and agreed to maintain the litigation record under seal. In the meantime, Nokia entered into a license agreement with InterDigital as a "most favored licensee."  Thus, Nokia's payments are based on settlement amounts from the Ericsson case.

To protect its interests, but only after the Ericsson settlement, Nokia moved to intervene in the Ericsson case.  The district court granted Nokia's motion -- holding that "the Court’s rulings potentially affects Nokia’s obligations under its agreement with InterDigital." InterDigital appealed.

Finding that intervention is not a matter unique to patent law, the CAFC applied Fifth Circuit law to determine whether the intervention was proper. Under Fifth Circuit precedent, the appellate panel found that since Nokia filed its motion after the case was already dismissed, "Nokia’s motion to intervene failed to satisfy the Fifth Circuit requirement that there be an existing suit in which to intervene."

Reversed --

Supreme Court Asked to Raise Standard for Obtaining Injunctive Relief

eBay v. MercExchange (on petition for certiorari)

After finding MercExchange’s patent infringed and not invalid, the district court declined to issue an injunction against eBay.  In its decision, the district court found that MercExchange’s (i) willingness to license; (ii) failure to practice the patents itself; and (iii) comments to the media regarding its intent to enforce patent rights all weighed against any presumption that it would suffer irreparable harm without an injunction. 275 F.Supp. 2d 695 (E.D. Va. 2003).

On appeal, the Court of Appeals for the Federal Circuit reversed, finding that, absent exceptional circumstances, a district court should issue a permanent injunction after a finding of infringement.

Now, eBay has appealed to the Supreme Court by filing a petition for certiorari asking the court to hear its case. The petition briefly spells out the traditional four-factor injunctive relief test and argues that the four-factor test should apply to patent cases rather than the de facto per se test applied by the CAFC. 

In the four-factor test, the court should consider (i) irreparable harm from not issuing an injunction; (ii) whether an adequate remedy exists in law (damages) (iii) whether the injunction would be in the public interest; and (iv) whether a balance of hardships would tip in the plaintiff’s favor. 

eBay argues that the move away from injunction as a per se consequence of infringement does not raise the standard for obtaining injunctive relief -- rather, it is a move back to the standard originally intended by Congress.

Interestingly, this question arises at the Supreme Court as a proposed statute that would modify the principles of patent injunctive relief is being considered in Congress.

Inaccurate Video Submission Results in Unenforceable Patent

Frazier v. Roessel Cine Photo Tech (Fed. Cir. 2005)

by Jessica Lunney

The CAFC (Judges Bryson, Linn, and Dyk) affirmed the district court’s finding of inequitable conduct but vacated and remanded the award of attorney’s fees. 

In a patent infringement suit, the district court based its inequitable conduct finding on two references:  (i) a video submitted to the PTO to overcome a rejection and (ii) an unsubmitted, clipped advertisement in the client’s patent file.  Generally, the patent was directed towards a video camera lens, and the submitted video footage allegedly showed lens functionality.  As it turns out, the video was not actually created with the claimed lens.  The CAFC was unimpressed with the inventor’s assertion that the footage could have been filmed using his invention. 

Materiality + Intent: Because the video allowed a traversal of the PTO’s multiple rejections, the court deemed the video footage to be material.  Intent was implied from both the inventor’s repeated changing of his sworn testimony and the myriad misrepresentations he made to his business partner and his patent attorney.

The CAFC reversed the inequitable conduct finding inasmuch as it was based on the advertisement and therefore vacated the award of fees and remanded to the district court to determine whether the case was still exceptional.  Bryson’s separate opinion supported the entirety of the district court’s holding.

NOTE: Jessica Lunney is a law clerk at MBHB and a law student at Emory.  She will complete law school in June 2006.

BlackBerry Case Makes Major Precedential Changes

NTP v. Research-In-Motion (Fed. Cir. 2005)

The CAFC has released a new appellate opinion that modifies the court’s analysis of Section 271 of the Patent Act but leaves the decision against RIM largely intact.

In December 2004, the Federal Circuit released its original opinion that pushed against the territorial bounds of patent law.  In that opinion, the CAFC found that U.S. patent law covers instances where infringing elements are located abroad — so long as the “control and beneficial use” of the infringing system is within U.S. territory.  This legal finding meant that RIM’s BlackBerry business, which spanned across the U.S. and Canadian borders, could be found to infringe NTP’s patent.  Soon thereafter, RIM filed a motion for rehearing and rehearing en banc as well as other legal pleadings at the CAFC, district court, and PTO. 

Rather than taking up the question in an en banc hearing, the original three-member panel (Judges Michel, Schall, and LINN) granted the petition for rehearing and revised portions of the opinion that discussed Section 271 — and thus withdrawing the December 14 opinion.

The new 75 page opinion takes a fresh look at the extent that a patent must be practiced within the U.S. to fall within the guise of 271(a).

35 U.S.C. 271(a): . . . whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States . . . infringes the patent.

The major dispute revolved around the phrase “within the United States:”

The grammatical structure of the statute indicates that “within the United States” is a separate requirement from the infringing acts clause.  Thus, it is unclear from the statutory language how the territoriality requirement limits direct infringement where the location of at least a part of the “patented invention” is not the same as the location of the infringing act. (opinion at 52).

In an affirmative step, the court decided that locating a component outside the U.S. does not necessarily preclude infringement under 271(a). However, the court found that the analysis will depend upon the type of infringing act (use, make, sell) and the type of claim (system, method, product).

• USE of SYSTEM: The site of the use of a patent is “the place at which the system as a whole is put into service, i.e., the place where control of the system is exercised and  beneficial use of the system obtained.”
• USE of METHOD: Each step must be performed in the U.S. “We therefore hold that a process cannot be used ‘within’ the United States as required by section 271(a) unless each of the steps is performed within this country.”
• OFFERS to SELL and SELLING: You likely cannot infringe a method claim through sale! “It is difficult to envision what property is transferred merely by one party performing the steps of a method claim in exchange for payment by another party.  Moreover, performance of a method does not necessarily require anything that is capable of being transferred.” NOTE — The court did not explicitly rule on this issue. Rather they only implied what their ruling would be.

Referring to 271(f), the court found that supplying U.S. customers with products does not fall within the clause even if those customers plan to perform a method with the product that would be infringing if performed wholly within the U.S.

Settlement: In the wake of the December opinion, NTP & RIM reportedly reached a settlement that included $450 million for NTP.  The original settlement announcement was based on a 1/2 page term-sheet reportedly signed by the parties.  As would be expected, 50 square inches of paper turned out to create a whole new level of disagreement between the parties who have been working through court mediation to flesh out the agreement. 

In early June, the settlement issue came to a head and the parties staked out their positions on paper.  In a motion filed with the CAFC, RIM argues that the term-sheet was a settlement of the case, and, as such, the case is now moot.  RIM asked the CAFC to stay its decision on the for rehearing and remand the case to the district court to decide whether there has been a settlement.  On the other hand, NTP has argued that the term-sheet was not a settlement and that there was never a “meeting of the minds.” 

Now that the CAFC has remanded, the settlement issue will likely be resolved by the district court. (assuming the CAFC’s decision is not appealed to the Supreme Court).

Reexamination: In a parallel action, the patents at issue in the case (owned by NTP) are undergoing reexamination at the USPTO.  As occurs in almost all inter partes and director-ordered reexaminations, the patent office has issued a non-final rejection in each NTP case that it has examined.  Although this first rejection is a good sign for RIM, a final decision in the reexam will not be any time soon. (i.e., years).  NTP has the opportunity to file a response to the non-final rejection.  The PTO may then issue a final rejection, at which point NTP may ask for reconsideration, appeal to the PTO’s internal board (BPAI), and then appeal to the federal courts (i.e., the courts that have already determined that the patents are valid).

CAFC initiates mediation program

The Court of Appeals for the Federal Circuit has announced a new mediation initiative set to begin October 3, 2005. The court established the program with an en banc ordeder issued on August 1.  In addition, guidelines for th eprogram have also been issued.

Links:

• Link: En banc order initiating the CAFC mediation program.
• Link: Mediation program guidelines.

USPTO Revamps Internal Reexam Procedures

Over the past year, USPTO Director Jon Dudas has given high priority to streamlining the PTO's reexamination procedures.  To that end, on July 29, 2005, the PTO announced a new initiative to ensure that reexaminations are performed in a timely and accurate manner.

Under the initiative, the PTO has opened an office with 20 primary examiners who focus their time entirely on reexaminations.  All new requests for reexam will be assigned to that office in order to both enhance the quality and reduce the time of reexamination "by allowing the USPTO to monitor more effectively the reexamination operations."

The USPTO’s goal is that reexaminations that have been pending with an examiner more than two years now will be resolved by October 1, 2005. In addition, all future reexamination proceedings will be completed within a specific timeframe, which is expected to be less than two years. In March 2005 there were over 420 reexaminations that had been pending more than two years and that number would have grown to over 600 by the end of September 2005. Today, fewer than 360 cases remain, with nearly half in the final stages. To ensure the quality of these proceedings, all reexamination decisions now require a thorough review by a panel of supervisors and senior patent examiners. Reexaminations where an initial decision has been made will remain with the examiner originally assigned to the reexamination. All other reexaminations will be reassigned to a newly formed central reexamination unit.