Patently-O: Patent Law Blog

Sale of product through an intermediary can create personal jurisdiction for patent infringement.

Trintec v. Pedre Promotional Products (Fed. Cir. 2005).

Trintec sued Pedre for patent infringement in the District of Columbia accusing Pedre of violating Trintec's patents on automation of printed faces for use in clocks and watches.  Pedre moved to dismiss for lack of personal jurisdiction and improper venue.  Pedre attached a declaration attesting that its sole office and place of business was in NY and that it has no facilities or representatives in Washington D.C.  The district court granted Pedre's motion and dismissed the complaint based on a lack of personal jurisdiction.

On appeal, the Federal Circuit reviewed the details of general and specific jurisdiction:

“Specific jurisdiction ‘arises out of’ or ‘relates to’ the cause of action even if those contacts are ‘isolated and sporadic.’ . . . General jurisdiction arises when a defendant maintains ‘continuous and systematic’ contacts with the forum state even when the cause of action has no relation to those contacts.

The appellate court also noted that they were "left totally in the dark about the reasons for the district court's action.  The panel then vacated the dismissal, finding that jurisdiction could be established under D.C.'s long-arm statute if Pedre's products were sold in DC. (The sale creating a tort).

Interestingly the court discussed the extent that Pedre's interactive website would create jurisdiction -- however, in the end, they expressly decided not to decide that issue. (because it was moot).

The case was remanded for a further exploration of factual issues to determine whether jurisdiction does exist.

 

 

Canada Challenges Federal Circuit's Patent Decision in BlackBerry Case.

BlackBerry maker Research-In-Motion (RIM) has requested a rehearing en banc at the Federal Circuit in an attempt to escape from the $53 million damage award and the expected injunction against its BlackBerry system for patent infringement.  In a strong power play, the Government of Canada has filed an amicus brief, supporting the rehearing.  As have the Canadian Chamber of Commerce and the Information Technology Association of Canada.  These Canadian Briefs essentially ask the court for comity -- arguing that the holding in RIM upsets the business and legal climate in Canada. (Other amicus briefs are expected to be filed within the next few days).

Frankly, I was surprised at the Federal Circuit's decision last month that found that RIM could be liable for direct infringement even though its some of the necessary elements of the asserted claims occurred outside the U.S. (in Canada).  The diagram above (from RIM's brief) shows RIM's e-mail relay in operation in Canada.  The relay is a distinguishing feature of NTP's patents.

RIM's most compelling argument is that the infringement of NTP's patents did not occur "within the United States" as required by the statute.  Obviously RIM's argument is strictly true.  However, the three judge appellate panel found that the test is not whether the infringement took place within the United States, but whether "control and beneficial use" of the infringing system was within the United States.

In my view, based on standing precedent of Deepsouth and Pellegrini, the Federal Circuit got this case wrong, and the standard of "control and beneficial use" should be tossed.

The court has traditionally had a strong stance against extraterritorial application of the patent laws.  In Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518 (1972), the Supreme Court of the United States (SCOTUS) strictly interpreted the patent act to find that unauthorized manufacturers of patented products could avoid liability for infringement under the then-existing law by manufacturing the unassembled components of those products in the United States and then shipping the components out of the United States for assembly. Congress enacted 35 U.S.C. § 271(f) in order to close that loophole.  However, § 271(f) does not apply to the facts of RIM v. NTP.   In Pellegrini, the court found that Pellegrini's case against Analog did not fall within the scope of newly enacted § 271(f), and thus, that the U.S. patent laws did not apply to extraterritorial manufacture and sale of a patented electric motor. 

In each of these cases (Deepsouth & Pellegrini), the Court denied the plaintiff's requests for extraterritorial application of the U.S. patent laws because the statute did not specifically call for such an application.  Because the statute does not specifically call for infringement under the RIM v. NTP scenario there should be no infringement here either.

As an aside: I do believe that there should be some legislative action to amend the patent laws in order to catch individuals who move portions of their systems (such as their router) to another country in order to avoid liability for patent infringement.  However, the Federal Circuit, like the Supreme Court in Deepsouth, is not in a position to generate such legislation.  Is anyone interested in working with me to draft such legislation?

UPDATE: James Hill, a blog reader from the UK wrote in noting the similarity between RIM and the UK case of Menasche v. William Hill. [summary] In Menasche, the Court of Appeals ruled that the invention (a system for online betting) was put into effect in the UK even though the server was located abroad. "By using their terminals in the UK, William Hill's customers were in a real sense also using the overseas host server in the UK."    

I think that there are some very strong similarities between the BlackBerry case and Menasche. The one major difference that RIM's attorney made in my discussion with him is that the operation of the ROUTER is a critical element of NTP's patent claims -- that portion of the claim was particularly pointed out by NTP during prosecution of the patent as a factor that made the invention unique from other prior art.  Thus, the claim is not keyed on the two end users, but rather about the entire chain of operation.

I agree that the specific facts are different from Pellegrini.  However, the principle that I derive from Pellegrini and Deepsouth is that there is a specific statute in U.S. Patent law that calls for extraterritorial application of the patent laws, and regardless of the policy arguments, the U.S. patent laws do not apply to foreign actions except where specifically called for in the statute.

 

UPDATE II: Mr. Petit over at Scrivener's Error makes the point that the the principle that "a right imply a remedy" might save the original opinion.

 

UPDATE III: Mathew Ingram, an excellent reporter at the Globe and Mail has written an article [subscription req'd] on the subject.  He questions whether the Canadian Government made the right move by filing a brief in this case. 

 

Links:

• RIMM's Motion for Rehearing
• Canadian Government's Brief in Support of Rehearing
• Federal Circuit Decision
• Canadian Chamber of Commerce

Patent court defers on divorce case

Weres v. Weres (Fed. Cir. 2005) (Unpublished)

In what appears to be its first divorce proceeding, the Federal Circuit has affirmed that a state court has power to affect the incidents of patent ownership after having divided the ownership interest.  The court went on to find that California courts provided the proper venue for determining the parties' rights and obligations (such as paying maintenance fees).

Further, the Court affirmed that the divorce decree did not create subject matter jurisdiction for the case under the Patent Act.

Supreme Court to Hear Patent Case Merck v. Integra.

Supreme Court Expected to Determine Whether Early Drug Research Necessary for FDA Approval Can Constitute Patent Infringement.

Merck v. Integra LifeSciences, U.S. Supreme Court (Case No. 03-1237).

The appeal to the Supreme Court questions the limits of the safe harbor statute (35 USC 271(e)(1)) that permits a drug manufacturer to perform experiments needed to obtain FDA approval of their drugs without incurring liability for patent infringement, even if their activities infringe other's patent rights.

Under the Fold: The Drug Price Competition and Patent Term Extension Act (Hatch-Waxman) created a safe harbor that permits drug manufacturers to perform the experiments needed to obtain FDA approval of their drugs without incurring liability for patent infringement, even if their activities infringe others patent rights.

However, the statute, codified at 35 USC § 271(e)(1), was limited by a 2003 decision by the Court of Appeals for the Federal Circuit.  The Federal Circuit affirmed a lower court's finding that the safe harbor against patent infringement does not apply to pre-clinical activities to identify and develop new drugs that will eventually be subject to FDA approval -- and thus, that Merck was liable to Integra for patent infringement.

The Case: Integra alleged that Merck and Scripps infringed patents owned by Integra relating to peptides involved in interactions between cell surfaces and the extracellular matrix.  Under contract from Merck, Scripps identified several potential anti-tumor peptide candidates and selected the most promising peptide by conducting in vivo and in vitro experiments to evaluate the specificity, efficacy, and toxicity of the peptide candidates for various diseases. Scripps also performed tests to assess the histopathology, toxicology, circulation, diffusion, plasma half-life, and proper mode of administering of the peptides candidates.

The Appeals Court held that these activities did not fall under the safe harbor (§ 271(e)(1)) because they were not done "solely for purposes reasonably related to the development and submission of information" to the FDA.

"the focus of the entire exemption is the provision of information to the FDA . . . [a]ctivities that do not directly produce information for the FDA are already straining the relationship to the central purpose of the safe harbor." (CAFC Opinion).

"Expansion of § 271(e)(1) to include the Scripps-Merck activities would effectively vitiate the exclusive rights of patentees owning biotechnology tool patents."

Supreme Court:

Merck has now appealed the case to the Supreme Court of the United States, petitioning the High Court to hear the question:

Under 35 U.S.C. 271(e)(1), it is generally not an act of infringement to use a patented invention “solely for uses reasonably related to the development and submission of information under a Federal law” regulating the manufacture, use, or sale of drugs. The question presented is whether the court of appeals erred in limiting that exemption to clinical studies designed to provide information for Food and Drug Administration approval of a new drug.

On request from the Court, the Solicitor General of the U.S. submitted the Government's view that the case should be heard.  The Government brief makes two major points, one legal and the other social:

Gov't Brief: The decision of the court of appeals reflects an incorrect view of the law, and is likely to restrict significantly the development of new drugs. Fairly read, the decision below holds that “pre-clinical” research regarding a potential new drug is not protected by the FDA exemption because that exemption is limited to “clinical” research necessary to obtain ultimate FDA approval of a new drug. That holding is inconsistent with the text of the FDA exemption, reflects a mistaken and unduly narrow view of the types of information relevant to the FDA’s two-step process for evaluating potential new drugs, and is in tension with this Court’s decision in Eli Lilly & Co. v. Medtronic, Inc., 496 U.S. 661 (1990). Moreover, the court of appeals’ decision poses a direct and substantial threat to new drug research by dramatically narrowing the scope of protections enacted by Congress in Section 271(e)(1). Although this case is not an ideal vehicle for considering the issue, see p. 18, infra, the potential impact of the court of appeals’ legal conclusion is sufficiently important that the petition for a writ of certiorari should be granted.

Eli Lilly and Co. was also granted leave to file a brief as amicus curiae in the case. Justice O'Connor and Justice Breyer took no part in the consideration or decision of the petition for writ of cert.  It is reported that both Justices own stock in Merck.

Academics Take Sides: Judge Richard Posner (In Lessig Blog) has advocated the creation of a fair-use exception for patents on research tools:

Link: For example, a generic drug manufacturer is permitted to use the patented drug to demonstrate that its generic equivalent is indeed therapeutically equivalent (the "testing" exception created by the Hatch-Waxman Act). More broadly, an inventor can use the information in the patent to try to invent around the patent. And Landes and I advocate an expansion of the patent fair-use principle to allow scientists to use patented research tools (such as the oncomouse) without license--provided the scientists aren't allowed to use the tools to produce their own patented products!

In response, Lichtman has noted that Judge Posner's proposal "is problematic for the simple reason that, often, the key market for research tools is to sell those tools to other researchers. If a researcher's use of patented research tool is fair use, that would significantly degrade the incentive to create those research tools inthe first place. Moreover, even if your approach works, it is in sharp conflict with the Bayh-Dole instinct that society might very well be better off in a world where academic researchers patent their work. As you know, that legislation was passed in response to evidence that university breakthroughts were sitting on the shelves both because (a) they could not be owned exclusively under old NIH rules; and (b) universities had too little incentive to bring their work to the attention of industry."

Links:

• AP Article by Hope Yen
• Supreme Court Website
• APLF Article on the Federal Circuit Decision
• Noonan, Greenfield, and Zuhn, Paradise Lost: The Uncertain Future of Research Tool Patents, 15 INTELL. PROP. & TECH. L.J. 1 (2003).

Patent Case: Federal circuit finds support for licensing contract in e-mail.

Lamle v. Mattel (Fed. Cir. 2005).

Lamle is the inventor of Farook, a game similar to Tic Tac Toe. In 1997 Lamle and Mattel agreed on an exclusive license. The contract terms were discussed via e-mail but a licensing agreement was never signed by Mattel.

After a pre-toy fair, Mattel concluded that it did not wish to license Farook. Mattel notified Lamle of its decision by fax sent to Lamle at the office of a business associate. The fax arrived while Lamle was present at his associates office attending a meeting with potential investors.

Lamle sued for breach of contract and patent infringement. However, the district court granted summary judgment to Mattel on all claims. "Its order and judgment listed six grounds for its decision, each being one sentence long, with no citations to any case or to the record, and providing no explanation as to the facts or law upon which it was relying." Specifically, the district court found that the agreement did not include all the essential terms and was additionally barred by the statute of frauds. 

The federal circuit disagreed, finding that there were outstanding questions that could not be determined on summary judgment.  Applying California law, the appellate court first held that the the existence of an oral agreement depended upon the intention of the parties -- a subject that was not properly addressed on summary judgment.  

The question as to whether an oral agreement, including all the essential terms and conditions thereof, which according to the mutual understanding of the parties is to be subsequently reduced to writing, shall take effect forthwith as a completed contract depends on the intention of the parties, to be determined by the surrounding facts and circumstances of a particular case.

Then, the e-mail outlining the terms of the deal was sufficient to overcome the Statute of Frauds that requires contracts that could not be performed within one year of their making to be contained within a written agreement.

Vacated and Remanded

In Dissent, Judge Newman could not find an oral agreement because the parties had specifically agreed that "any obligation would be contained in a formal written agreement."

As a matter of law, there can have been no patent license and manufacturing and sales agreement between Mattel and Mr. Lamle, when no such license and no manufacturing and sales agreement were ever entered into. Thus I must, respectfully, dissent from the court's decision, for it is founded on incorrect principles of law.

 By Dennis Crouch

 

CAFC: District court must specify motivation to combine prior art references

Teleflex v. KSR (Fed. Cir. 2004) (unpublished).

Intro: Teleflex sued KSR for alleged infringement of Teleflex's patented adjustable gas-pedal assembly (Patent No. 6,237,565).  The case was dismissed on summary judgment after the judge determined that the invention was obvious.  Teleflex appealed the decision.

Obviousness: A patent claim is obvious, and thus invalid, when the differences between the claimed invention and the prior art "are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art." The determination of whether an invention is obvious is based on a number of factors -- commonly termed Graham Factors, including:

1. the scope and content of the prior art;
2. the level of skill of a person of ordinary skill in the art;
3. the differences between the claimed invention and the teachings of the prior art; and
4. the extent of any objective indicia of non-obviousness.

If obviousness is found by combining multiple references, there must also be some motivation to combine the prior art teachings in the particular manner claimed. In re Kotzab.

The Case: In its decision, the Appellate Court agreed with Teleflex, that the district court applied an incomplete teaching-suggestion-motivation test. 

This is because the district court invalidated claim 4 of the ’565 patent on obviousness grounds without making “finding[s] as to the specific understanding or principle within the knowledge of a skilled artisan that would have motivated one with no knowledge of [the] invention to make the combination in the manner claimed.” . . . The district court was required to make specific findings as to whether there was a suggestion or motivation to combine the teachings of Asano with an electronic control in the particular manner claimed by claim 4 of the ’565 patent.

Because the district court failed to make specific findings as to the suggestion or motivation to combine references, the CAFC vacated and remanded.

Posted by Dennis Crouch | Permalink

CAFC: Patent Valid Even if Structural Description of Means-Plus-Function element Only in Figures

Freeman v. Gerber & Playtex (Fed. Cir. 2005) (Unpublished)

Freeman owns a patent on a spill-proof beverage container (a sippy-cup).  During an infringement suit against Gerber & Playtex, the Kansas District Court ruled that means-plus-function clauses of the asserted claims were indefinite, and thus invalid. Freeman appealed.

On appeal, Freeman argued that the drawings sufficiently described the claimed structure & its function.  Gerber, in response contended that "merely depicting a structure in a patent's drawings is not enough to clearly link the structure to a particular recited function."

The court sided with Freeman, finding that patent drawings may be used to determine whether the patent "adequately disclosed structure corresponding to the recited functions."  The court went on to find that including the figures in the analysis avoided any indefiniteness problem.

Reversed and Remanded

Posted by Dennis Crouch | Permalink

Jan 06, 2005

Festo Defined: Appeals Court gives example of amendment that is not narrowing

Business Objects v. Microstrategy (Fed. Cir. 2005)

Business Objects owns a patent on a relational database system that uses "semantically dynamic objects." The patent allows users to access a relational database without knowing standard database query language (SQL). (U.S. Patent No. 5,555,403).

The District Court ruled that Microstrategy's product did not infringe several of the claims, even under the doctrine of equivalents -- Thus granting summary judgment of noninfringement for Microstrategy.

On appeal the Federal Circuit affirmed in-part, but reversed the lower court's ruling that an amendment to claim 4 during prosecution narrowed the claim and thus precluded equivalents.

Claim 4 was a method claim added during prosecution and is similar to the originally filed claims.  However, the claim changed a step that involved "translating a user query to a structured query" to "generating queries in the predetermined query language."  The district court held that this amendment narrowed the scope of the function of the query engine means for purposes of patentability and raised a Festo presumption.

However, the Federal Circuit found that the new claim actually broadened the scope of the patent.  Under Festo, if the amendment is not narrowing, then prosecution history estoppel does not apply. 

The case is remanded back to the Northern District of California.

[Link] Business Objects previously settled with Cognos and others in a dispute over the same patent.

Update: The plaintiff and defendant offered competing press releases on the outcome:

•  MicroStrategy Wins Favorable Ruling in Patent Lawsuit Against Business Objects
•  Business Objects wins MicroStrategy patent suit appeal 

Posted by Dennis Crouch | Permalink

palmOne Comes Out on Top in NCR's Patent Infringement Appeal

NCR v. Palm and Handspring (now collectively known as "palmOne") (Fed. Cir. 2005).

by Marcus Thymian

In an unpublished decision, the Federal Circuit affirmed the Delaware District Court's claim construction, essentially putting to rest NCR's patent infringement suit against palmOne for its popular Palm and Handspring handheld devices.  NCR's Patent Nos. 4,634,845 and 4,689,478 are directed to a handheld device and system employing such a device.  The claims generally call for a handheld device having discrete display elements overlapped with discrete switches, along with control means and circuitry for interfacing with another device.

The Federal Circuit focused on the "plurality of discrete switches" and the closely related "means for entering data" elements.  In an attempt to read on palmOne's resistive touchscreen technology, NCR argued that the "plurality of discrete switches" should be construed as "more than one individually distinct programmed device for indicating that one of alternative states or conditions have been chosen."  The Federal Circuit rejected this "programmed device" definition, and instead adopted the district court's "physical switch" definition:  "two or more distinct and separate manual or mechanically actuated devices for making, breaking, or changing the connections in an electric circuit."  It based its decision on the claim language (which contradicted NCR's assertion that software integrated into the plurality of switches, rather than the "control means," handled variable user instructions), and the patent specifications, which showed an array of switches made of "a few plastic-film layers and strips of conductive material."  Similarly, the Federal Circuit agreed that the "means for entering data," a means-plus-function element under 35 U.S.C. § 112 ¶ 6, was limited to the physical switches set forth in the patent specifications.

Marcus Thymian is a partner at McDonnell Boehnen Hulbert & Berghoff LLP in Chicago.  Mr. Thymian is experienced in planning, creating, enforcing, and defending against patent portfolios, and was part of the team from McDonnell Boehnen Hulbert & Berghoff that represented Palm (now palmOne) before the Delaware District Court and on appeal.  [Marcus Thymian's Bio]

LINKS:

• [Link] Ina Fried has a CNET report on the case;
• [Link] 2003 CNET Report on the district court case won by Palm.

Posted by Dennis Crouch | Permalink | TrackBack

Jan 05, 2005

Looming specter of litigation creates sufficient uncertainty for declaratory judgment action

Electronics for Imaging v. Coyle (Fed. Cir. 2005) [pdf]. 

By Dennis Crouch

EFI makes controllers for network printing.  Coyle obtained patents on his network printing inventions and informed EFI that it was (allegedly) violating his patent.

Coyle began to pressure EFI on an almost daily basis, threatening to drive EFI out of business. EFI alleges that Coyle repeatedly warned that he would bring multiple lawsuits, stating that “we’ll sue all of your customers” and “bad things are going to happen.”  Coyle even identified specific attorneys and law firms in support of his litigation threats.

EFI sued for declaratory judgment.  The district court, however, dismissed the action. EFI appealed to the Federal Circuit.

A declaratory action allows a party “who is reasonably at legal risk because of an unresolved dispute, to obtain judicial resolution of that dispute without having to await the commencement of legal action by the other side.” 

The district court had dismissed the declaratory judgment action because it determined that EFI did not have any uncertainty about Coyle’s intention to sue (Coyle stated flatly that it he would sue).  Additionally, the court found that EFI was not uncertain about the strength of its legal position.

On appeal, the Federal Circuit reversed, disagreeing with the district court's interpretation of "uncertainty."

The proper inquiry should not have been whether a party is “certain” that its legal position and defense theories are sound, because litigation is rarely “certain,” even if one is confident of one’s position. When a party is threatened ... there are other uncertainties, including whether there will be legal proceedings at all, not just whether one will prevail. There is the uncertainty whether one will have to incur the expense and inconvenience of litigation, and how it will affect the threatened party’s customers, suppliers, and shareholders. Reservation of funds for potential damages may be necessary. ... “Uncertainty” in the context of the [Declaratory Judgment] Act refers to the reasonable apprehension created by a patentee’s threats and the looming specter of litigation that results from those threats.

Posted by Dennis Crouch | Permalink

Jan 04, 2005

CAFC: Design Patent Infringement Opinion Need Not Mention Every Detail of a Patented Design

Brooks Furniture v. Dutailier Int’l. (Fed. Cir. 2005) (03-1379) [pdf].

By Jennifer Swartz

Brooks Furniture brought a declaratory judgment action in Tennessee District Court after receiving a cease and desist letter from Dutailier International, the assignee of the design patent for “Rocking Chair Trim.”  Although the cease and desist letter sent to Brooks Furniture was based upon opinions of counsel, officers, and outside experts, the district court found that the letter had been sent in bad faith by Dutailier because the opinions Dutailier relied upon did not discuss the chair back’s specific feature of a “trailing edge descending in a gentle ‘s’ curve.” Accordingly, the lower court deemed the case exceptional and awarded attorney fees. 

The Federal Circuit vacated the award, rejecting the lower court’s narrow view of the opinion’s reasonableness:

The fact that an infringement opinion may not have mentioned every detail of the patented or the accused design does not necessarily render the opinion wrong or unreliable.

As the test for a design patent’s infringement is “substantial identity,” not every aspect of the design need be identical, and thus an opinion need not consider every aspect of a design to be reasonable. 

Jennifer Swartz is an associate at McDonnell Boehnen Hulbert & Berghoff LLP in Chicago.  Ms. Swartz has experience in various aspects of intellectual property litigation including patent and trademark infringement, and trade secret violations.  [Brief Bio]

Posted by Dennis Crouch | Permalink

Jan 03, 2005

Federal Circuit Gives PTO Free Rein To Demand Information Beyond That Defined By Section 1.56 As Material to Patentability

Star Fruits S.N.C. and Institute of Experimental Botany v.

United States

and Department of Commerce (Fed. Cir. 2005)

By Alison Baldwin

What appears on its face to be a strictly procedural case actually raises a few interesting policy issues.

Procedurally, Star Fruits filed a U.S. Patent Application directed to a variety of peach tree.  In a subsequent office action, the examiner included a "Requirement For Information Under 37 C.F.R. 1.105" that included a request for "any information available regarding the sale or other public distribution of the claimed plant variety anywhere in the world" and "copies of the application, published proposed denomination and published Breeder's Right grant."  Star Fruits declined to provide the information requested under 37 C.F.R. 1.105 on the grounds that the material requested was "not material to patentability of the new variety."  Because Star Fruits did not comply with the Examiner's request, the Office issued a Notice of Abandonment.  Star Fruits petitioned the Director pursuant to 37 C.F.R. 1.181 and the petition was denied.  Subsequently, Star Fruits appealed to the district court under the Administrative Procedure Act.

In addressing 37 C.F.R. 1.105, the Federal Circuit has interpreted the rule to include "a zone of information beyond that defined by section 1.56 as material to patentability, and beyond that which is directly useful to support a rejection or conclusively decide the issue of patentability."  The court held that, so long as the request from the examiner for information is not "arbitrary or capricious," the applicant must comply with the request.

Furthermore, the Federal Circuit noted that if Star Fruits believed that the requested information was going to be used to support a wrongful rejection under 35 U.S.C. 102, it should have provided the information and then subsequently argued against the wrongful use.  The court held that Star Fruits had no right to object to the potential use of the information. 

Interestingly, in her dissenting opinion, Judge Newman argued that Star Fruits did exactly what it was supposed to do, when faced with an agency's change in law and practice.  Star Fruits was challenging the PTO's 2001 change in practice holding that a foreign sale or use of a plant that has foreign Breeder's Rights registration may bar United States patentability of that plant.  This information requested by the examiner was for support for a rejection based upon this policy change.  This internal change in practice is arguably an attempt by the PTO to broaden 35 U.S.C. 102 without the required notice-and-comment rulemaking procedures.  Judge Newman criticized the panel for ignoring the real issue of law underlying this dispute. 

NOTE: Alison Baldwin is a partner at McDonnell Boehnen Hulbert & Berghoff.  Her patent litigation experience has covered a diverse range of topics, from recombinant DNA technology to digital television. In addition to her law degree, Ms. Baldwin holds degrees in biochemistry and plant pathology and has conducted research on the molecular mechanisms involved in plant disease resistance. [Brief Biography].

Posted by Dennis Crouch | Permalink

University of Illinois fails to secure soverign immunity in plasma screen patent dispute

Competitive Technologies and the University of Illinois v. Fujitsu (Fed. Cir. 2005).

In June 2004, the Federal Circuit dismissed the University of Illinois appeal for sovereign immunity under the Eleventh Amendment.  In that opinion, the Court found that the appeal lacked proper jurisdiction because the district court's decision to not allow sovereign immunity was not a "final decision."

Now, the Federal Circuit has denied the University's request for a rehearing. Specifically, the University argued that the cases relied by the Federal Circuit had been undermined by later case law.  The Federal Circuit disagreed:

As we have held, the decisions of the Supreme Court . . . make clear that a non-final resolution does not satisfy the Cohen test. Thus, the application of the first prong of Cohen in Agent Orange has not been undermined by subsequent decisions of the Supreme Court or other courts of appeals.

Petition for Rehearing Denied.

Posted by Dennis Crouch | Permalink

Dec 29, 2004

Federal Circuit: Court Erred in Finding Case "Exceptional"

Spectrum Labs v. Tech International (Fed. Cir. December 29, 2004).

Spectrum sued Tech Int'l for infringement for its patent related to a method of removing unwanted substances from human urine samples.  The purification method allows urine to be tested without interference from the unwanted substances.  The Nevada District Court granted summary judgment of non-infringement to Tech and granted Tech's motion for attorney's fees -- noting that the suit was frivolous and in bad faith. 

Tech appealed the award of attorney's fees.

On appeal, the Federal Circuit reversed -- finding that the case was not "exceptional" under the statute (35 USC 285).

The CAFC listed types of cases that may create an "exceptional" circumstance: inequitable conduct before the PTO, litigation misconduct, vexatious and otherwise bad faith litigation, frivolous suit or willful infringement.  However, the Appeals Court found "none of those circumstances present" in this case.

A district court must provide reasoning for its determination that a case is exceptional for us to provide meaningful review. Further, an exceptional case finding is not to be based on speculation or conjecture but upon clear and convincing evidence.  The facts cited in the section 285 order do not provide clear and convincing evidence that Spectrum’s investigation and credit check constituted vexatious behavior. The section 285 order merely highlighted the fact that the credit check and background investigation occurred after issuance of the summary judgment order. Section 285 Order, slip op. at 3. The district court’s open speculation about the purpose of Spectrum’s investigations adds no support to its finding.

The Law: The determination whether to award attorney’s fees under section 285 involves a two-step process. First, the district court must determine whether Tech proved by clear and convincing evidence that this case is "exceptional." . . . Second, if the court finds the case to be exceptional, it must then determine whether an award of attorney’s fees is appropriate.

Comment: This case is really a commentary on claim construction jurisprudence.  In my view, the court could not call this an exceptional case because of the uncertainty associated with claim construction.

Posted by Dennis Crouch | Permalink

Dec 27, 2004

Anheuser-Busch loses patent infringement appeal: case remanded to district court

Anheuser-Busch v. Crown Cork & Seal (Fed. Cir. Dec. 23, 2004) (unpublished)

In an unpublished decision, the Court of Appeals for the Federal Circuit (CAFC) has revived Crown's case against Anheuser-Busch -- sending the patent dispute back to the Wisconsin district court to determine whether A-B's aluminum cans violate Crown's patent No. 6,065,634.

Specifically, the Appellate Court disagreed with the lower court's claim construction -- finding that the district court erred by importing a limitation into the claims that was not required by the specification. 

The patent does not indicate that the shape of the chuck wall is necessary to accomplish the [strength] goal.  THus, no basis exists for the court to import the "flat" limitation from the preferred embodiment into the claims.

The district court must now re-construe the claims and determine whether the new construction alters its prior conclusion that Anheuser-Busch did not infringe Crown's patent.

The CAFC also affirmed the dismissal of Anheuser-Busch's claim that Crown violated A-B's design patent No. D387,987.

Posted by Dennis Crouch | Permalink

Dec 20, 2004

The Scoop on Geico v. Google

Geico v. Google

(E.D. Va. Dec. 15 2004) (On Oral Arguments).

Summary:

Google's use of a trademarked term for advertising keywords does not create customer confusion -- and thus does not violate the Lanham Act.  However, the use of the trademarked term itself in sidebar ads does create customer confusion and may violate the Lanham Act.

More Details:

Geico has sued Google for trademark infringement.  Geico is upset that Google users may find a competitor's ads after searching for "Geico."  Essentially, the issue is whether the use of trademarks as keywords for paid advertising violates the Lanham Act.  A bench trial began last week in U.S. District Court in Alexandria Virginia.

As plaintiff, Geico first presented case-in-chief (excluding damages).  At the close of Geico's case, Google asked the court to grant judgment as a matter of law under Rule 52(c).

Federal Rules of Civil Procedure Rule 52(c) Judgment on Partial Findings. If during a trial without a jury a party has been fully heard on an issue and the court finds against the party on that issue, the court may enter judgment as a matter of law against that party with respect to a claim or defense that cannot under the controlling law be maintained or defeated without a favorable finding on that issue . . . Such a judgment shall be supported by findings of fact and conclusions of law.

In its oral decision on the motion, the court sided with Google in-part.  First, the court noted that Geico had not established that the "mere use of its trademark" as an advertising keyword violates the Lanham Act. 

Having heard the plaintiff's case, the Court is satisfied that the plaintiff has not established that the mere use of its trademark by Google as a search word or keyword or even using it in their AdWord program standing alone violates the Lanham Act because that activity in and of itself, there's no evidence that that activity standing alone causes confusion.

However, on the issue of whether Google's sponsored ads that actually use GEICO's name in the title or text of the ad, the court found that the plaintiff had presented sufficient evidence of confusion to allow the case to continue.

However, as to the narrow issue of whether the plaintiff has presented sufficient evidence at this point to let the case continue on the issue of whether Google is liable for violating the Lanham Act for those sponsored ads using GEICO's name in either the title or the text that appear next to a -- and a GEICO organic listing as a result of the AdWord program, at this point, there has been enough evidence of confusion as a result of Dr. Ford's report to deny the motion and to allow the case to continue so the Court can consider the defendant's evidence as to whether or not this situation creates a likelihood of confusion in the marketplace and, if so, what damages might be appropriate.

When presenting its case Google will continue to argue that it has a policy in place to prevent the use of the GEICO trademark in competitor's ads -- and that Google should not be held liable when those competitors violate the policy.

The case has been stayed until early January -- awaiting the judge's written decision.

Comment:

Is Google a stand-up company or what!  Most defendants who are being sued over their core technology would take any available legal self-help measures.  Is anyone surprised that a Google search for Geico still turns up Geico?  [Link]

Links:

• Transcript of the oral decision. [txt];
• Google's Memo in Support of their Motion [pdf];
• Geico's Answer [Unavailable -- filed under seal];
• Google's Reply [pdf];
• Who Represents Google & Geico.

Posted by Dennis Crouch | Permalink

Dec 16, 2004

Federal Circuit: Pieczenik v. Dyax

Pieczenik v. Dyax (Fed. Cir. December 16, 2004) (Unpublished Opinion).

George Pieczenik owns several patents relating to a method of inserting DNA sequences into DNA vectors.  (For Example, U.S. Patent No. 4,528,266-A).

In an infringement lawsuit against Dyax, the district court granted summary judgment in favor of Dyax -- ruling that Dyax did not infringe the asserted patents. 

After the close of the case, Pieczenik filed a motion for reconsideration under Rule 60(b).

Rule 60(b): "On motion and upon such terms as are just, the court may relieve a party or a party’s legal representative from a final judgment, order, or proceeding” under specified circumstances, including: “(2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b).”

Pieczenik alleged that he had uncovered new information that established the falsity of an affidavit of Dyax's Senior VP that had been submitted in support of its motion for summary judgment.  The district court denied the motion to reopen the case. 

On appeal, the Federal Circuit affirmed -- finding that (i) the evidence presented was not "newly-discovered" because it would have been available to Pieczenik if he had followed through with discovery; and (ii) Pieczenik did not show how the new evidence would alter the district court's claim construction.

Posted by Dennis Crouch | Permalink

Dec 15, 2004

Will the PTO soon be issuing Search Reports?

Back in the day, when you filed a patent application, you would send in a filing fee that covered filing expenses, searching, and examination -- all for one low price of around $700 (less for small entities).  In the recent rash of Fee Changes, the filing fee has been reduced to $300!  "Hold-on now," you're saying, "patent office (and attorney) fees are never reduced."  The trick is that the PTO added a search fee $500 and an examination fee $200.  Bringing the total due on filing to $1,000.

This break-down of the fees suggests that the PTO may also change its practice.

Is there some chance that the PTO will adapt to the PCT practice of providing a search report?  What a grand idea.

Posted by Dennis Crouch | Permalink | Comments (1) | TrackBack

Dec 14, 2004

Iron Grip v. USA Sports: Three-Hole Weight Plate Obvious

Iron Grip Barbell v. USA Sports (Fed. Cir. 2004).

Iron Grip is the assignee to U.S. Patent No. 6,436,015, which covers a weight plate with a triad of dispersed grip locations.  USA makes allegedly infringing plates.  The district court granted USA's motion for summary judgment that the patent was obvious, finding that "it would have been obvious to a layman to combine the prior art."  On appeal, the Federal Circuit affirmed:

Because the claimed invention falls within a range disclosed in the prior art, and the patentee has not shown that the prior art taught away from the invention or new and unexpected results from a three elongated grip weight plate as compared to those in the prior art, we conclude that the claims are obvious absent substantial evidence of pertinent secondary factors supporting patentability.

Finding of obviousness affirmed

Barbell companies have been getting rejected at the trademark side of the PTO as well.  John Welch filled me in on the recent case of in re Ivanko Barbell Company (not precedent).

In Ivanko, the TTAB refused to register the weight plate design (shown above) for two reasons: (i) functionality and, in the alternative, (ii) failure to establish distinctiveness.  The applicant had essentially admitted functionality -- that is a bad move at the TTAB or when applying for a design patent.

As required by the statute, we must consider whether applicant’s design as a whole is functional. 15 U.S.C. § 1052(2)(5). Here, the evidence supports the examining attorney’s position that the design is de jure functional. Applicant touts the utilitarian advantages of safety and ease of handling of its design.

The Board noted that, because the designs are functional, any evidence of distinctiveness is moot.  However, for the sake of completeness, the board discussed the applicant's contention that its designs had acquired secondary meaning.  The applicant had presented survey information in an attempt to show secondary meaning associated with the 7-hole weight plate:

Applicant has the burden of proving that its mark has acquired distinctiveness. . . . Of the survey respondents who were familiar with the Ivanko barbell weigh weight [sic] plate in question with all indicia removed (Picture A-1), 58.65% associated the appearance of the barbell weight plate shown with Ivanko and an additional 8.65% associate it [with] one company.”

However, the majority of survey participants were upper level employees in the barbell business, and thus, the court could not tell whether potential consumers have assigned any secondary meaning to the designs.

Posted by Dennis Crouch | Permalink

BlackBerry Maker RIM wins Partial Victory in Patent Appeal

NTP v. Research in Motion (Fed. Cir. 2004).

In this highly anticipated patent case, the Federal Circuit has vacated the district court's judgment and injunction.

Accordingly, the judgment and the injunction are vacated, and the case is remanded to the district court for further proceedings consistent with this opinion. We affirm the district court’s judgment in all other respects. We thus affirm-in-part, vacate-in-part, and remand.

HOWEVER, RIM's win is marginal at best -- NTP remains in a strong position as the case returns to the district court.  The decision is remanded for the district court to determine what portion, if any, of the jury verdict should be set aside, based on the prejudicial effect of the court's misconstruction of a single claim term.

Specifically, the Appeals Court only questioned the infringement decision on five of NTP's patent claims.  Presumably, the verdict of infringement on the other eleven claims is upheld.

Background:

NTP's patents are directed toward an "electronic mail system with RF communications to mobile processors." (e.g., U.S. Patent No. 5,436,960). NTP sued RIM, maker of the BlackBerry for patent infringement.

The district court “construed the disputed terms according to their plain and ordinary meaning, as supported by the specification and prosecution history.”  Based on the claim construction, the district court granted summary judgment to NTP on several patent claims -- finding that the BlackBerry infringed some of the claims.  The remaining claims were decided by the jury.

On every issue presented, the jury found in favor of the plaintiff, NTP. The jury found direct, induced, and contributory infringement by RIM on all asserted claims of the patents-in-suit. The jury also found that the infringement was willful. It rejected every defense proposed by RIM. Adopting a reasonable royalty rate of 5.7%, the jury awarded damages to NTP in the amount of approximately $23 million.

The court awarded monetary damages totalling more than $53 million, with the following approximate division: (1) compensatory damages of $33 million; (2) attorneys’ fees of $4 million; (3) pre-judgment interest of $2 million; and (4) enhanced damages of $14 million. The court also entered a permanent injunction against RIM, enjoining it from further manufacture, use, importation, and/or sale of all accused BlackBerry systems, software, and handhelds.

Claim Construction:

The Court of Appeals for the Federal Circuit reviewed the claims construction de novo, taking an ordinary meaning approach: "In the absence of an express intent to impart a novel meaning to the claim terms, the words take on the full breadth of the ordinary and customary meanings attributed to them by those of ordinary skill in the art," using the written description as examined through the viewing glass of a person skilled in the art to give context to the claim language.

The CAFC agreed with the RIM on only one point:

that the district court misconstrued the term "originating processor."  The Appeals Court found that the originating processor as claimed by NTP refers to only one processor - and not three separate processors.

On all other points, the CAFC affirmed the district court ruling, these include (i) construction of all other terms; (ii) a decision that RIM's Canadian server location does not prevent application of U.S. Patent Laws to the e-mail system; (iii) Denial of RIM's motion for JMOL; and (iv) exclusion of RIM's expert and demonstrative testimony.

Conclusion:

RIMM won the appeal on a sliver of an argument, but is still in a position to lose the case.

AFFIRMED-IN-PART, VACATED-IN-PART, AND REMANDED

by Dennis Crouch

Links:

• Federal Circuit's Decision [pdf];
• cNet Article;
• How Appealing;
• RIM Trading Halted.

Notes:

• The decision was a rare unanimous claim construction decision written by Judge LINN and signed by MICHEL & SCHALL.
• The opinion is 60 pages in length [pdf].
• Comment from a Reader

The CAFC reversal of the claim construction of the District Court does not affect all of the asserted and infringed claims. According to the opinion 'some' of the claims are definitely infringed on. However, it was remanded because the jury did not outline how much royalties apply to each infringed claim. The CAFC only reversed the claim construction of "originating processor" found in some claims and not of the comparable "originating device" found in the other claims. The District Court had construed these terms them separately and RIM only appealed "originating processor" and not "originating device". So I guess it can be said the NTP won a "Judgement-in-Part."

• You should also note that the re-examination of NTP's patents continues at the USPTO.
• If the BlackBerry's infringe, why did the the Appeals Court reinstate the injunction against RIM?

A Tom Kirby, a Patently-O Reader, answers my question:

Vacating an judgment often does not imply disapproval, but merely clears the deck for further action by a lower court.  The U.S. Supreme Court has an established practice known as GVR.  When it decides a case there may be several other arguably similar cases in the pipeline from the Court of Appeals.  The Supreme Court will (i) Grant review of the case, (ii) Vacate the decision below, and (iii) Remand for reconsideration in light of the recent decision.  Very often the Courts of Appeals conclude that little or nothing needs to be changed and simply reinstate their previous ruling.

Foreign Infringement:

Today, this case is important because of the millions of BlackBerry users in the U.S.  However, the doctrinal significance of this case will be the Federal Circuit's stance on the inclusion of foreign components in the infringement analysis. 

Under the Patent Act [35 U.S.C. 271(a)], patent rights are limited by the territory of the United States.  However, in this case, the court found that plain language of section 271(a) does not preclude infringement where a system such as RIM’s, alleged to infringe a system or method claim, is used within the United States even though a component of that system is physically located outside the United States."

According to the Court, the test is not whether the infringement took place within the United States, but whether "control and beneficial use" of the infringing system was within the United States.

This liberal interpretation of the territoriality restrictions of the Patent Act bodes well for Eolas in the recently heard Microsoft v. Eolas appeal.

Posted by Dennis Crouch | Permalink

Federal Circuit Court of Appeals Gives Broad Construction to Means Claim

Versa v. Ag-Bag (Fed. Cir. 2004).

Versa owns a patent on an apparatus for creating air channels in bagged compost materials. The air channels allow for decomposition of the material.

Versa filed suit against Ag-Bag for patent infringement.  However, in the wake of an adverse Markman hearing, Versa admitted that it could not prove infringement based on the district court's claim construction. After filing the appeals, the parties entered into a settlement agreement that resolved all issues on appeal other than the proper construction of the “means . . . for creating air channels” limitation. The parties have also agreed that, if we conclude the flutes are required, Ag-Bag will pay Versa an agreed royalty. Thus, the sole question before us is whether under a proper claim construction the claimed bagging machines must include flutes.

The Federal Circuit found that the means-plus-function claim language did not require flutes.

Accordingly, since we hold that flutes are not required structure, the judgment of non-infringement based on the district court’s incorrect claim construction is REVERSED.

In Dissent, Newman:

This case does not present a new question, and it should not have a new answer. The question is, can a patent claim clause written in means-plus-function form be construed, as a matter of law, literally to cover a device that is not the invention described in the specification, that is not shown in any of the drawings, that was not examined for patentability, that was excluded by prosecution arguments, and that is not an asserted equivalent. Statute and precedent require that the question be answered in the negative. Until today.

Posted by Dennis Crouch | Permalink

Eolas v. Microsoft: On the briefs

Eolas v. Microsoft (04-1234)(On appeal at the Federal Circuit)

The parties in this case include Eolas and the University of California as plaintiffs and Microsoft as the defendant. In addition to the parties, a number of amicus briefs were filed at the Federal Circuit by interested parties.  These parties include: AOL; Association for Competitive Technology; Autodesk; Bentley Systems; Intel; Macromedia; Netscape; Oracle; Professor Joe Miller; Sun Microsystems; and Wacom Technology.

Amicus Briefs:

All of the Amicus briefs support Microsoft's position -- looks like nobody supports the little guy anymore.

• Association for Competitive Technology amicus brief [PDF]. ACT argues that the District Court made a major mistake by failing to undertake "reasonable efforts to find out" what was known or obvious to those skilled in the art at the time of the patent application.
• Autodesk, Bentley, Macromedia, WACOM, Professor Miller amicus brief [PDF].  This group argues that section 271(f) was incorrectly expanded by the district court.
• Netscape, AOL, Intel, Sun Microsystems amicus brief [PDF].  Netscape & friends argue that the Court should find "that section 271(f) does not apply to components manufactured outside of the U.S., even if they are manufactured using code, prototypes, molds, or templates designed and developed domestically."

Party Briefs:

• Microsoft opening brief [PDF].
• EOLAS answer [PDF].
• Microsoft reply [PDF].

Thanks to Gerry Stegmaier (ACT's attorney of record) and John Vandenberg (attorney of record for Autodesk, et al.) for providing copies of the briefs.

Robins Kaplan represents Eolas -- they have a unique trial preparation technique: Hung Jury.

Posted by Dennis Crouch | Permalink

Dec 12, 2004

Supreme Court Closer to Reviewing Hatch-Waxman Safe Harbor Patent Case

Merck v. Integra LifeSciences (On petition for writ of cert. at the Supreme Court).

The Drug Price Competition and Patent Term Extension Act (Hatch-Waxman) created a safe harbor that permits drug manufacturers to perform the experiments needed to obtain FDA approval of their drugs without incurring liability for patent infringement, even if their activities infringe others patent rights.

However, the statute, codified at 35 USC § 271(e)(1), was limited by a 2003 decision by the Court of Appeals for the Federal Circuit.  The Federal Circuit affirmed a lower court's finding that the safe harbor against patent infringement does not apply to pre-clinical activities to identify and develop new drugs that will eventually be subject to FDA approval -- and thus, that Merck was liable to Integra for patent infringement.

The Case: Integra alleged that Merck and Scripps infringed patents owned by Integra relating to peptides involved in interactions between cell surfaces and the extracellular matrix.  Under contract from Merck, Scripps identified several potential anti-tumor peptide candidates and selected the most promising peptide by conducting in vivo and in vitro experiments to evaluate the specificity, efficacy, and toxicity of the peptide candidates for various diseases. Scripps also performed tests to assess the histopathology, toxicology, circulation, diffusion, plasma half-life, and proper mode of administering of the peptides candidates.

The Appeals Court held that these activities did not fall under the safe harbor (§ 271(e)(1)) because they were not done "solely for purposes reasonably related to the development and submission of information" to the FDA.

"the focus of the entire exemption is the provision of information to the FDA . . . [a]ctivities that do not directly produce information for the FDA are already straining the relationship to the central purpose of the safe harbor." (CAFC Opinion).

"Expansion of § 271(e)(1) to include the Scripps-Merck activities would effectively vitiate the exclusive rights of patentees owning biotechnology tool patents."

Supreme Court:

Merck has now appealed the case to the Supreme Court of the United States, petitioning the High Court to hear the question:

Under 35 U.S.C. 271(e)(1), it is generally not an act of infringement to use a patented invention “solely for uses reasonably related to the development and submission of information under a Federal law” regulating the manufacture, use, or sale of drugs. The question presented is whether the court of appeals erred in limiting that exemption to clinical studies designed to provide information for Food and Drug Administration approval of a new drug.

Only a small percentage of cases appealed to the Supreme Court are accepted for hearing.  However, the Merck case took a major step closer to being heard last week.  On request from the Court, the Solicitor General of the U.S. submitted the Government's view that the case should be heard.  The Government brief makes two major points, one legal and the other social:

Gov't Brief: The decision of the court of appeals reflects an incorrect view of the law, and is likely to restrict significantly the development of new drugs. Fairly read, the decision below holds that “pre-clinical” research regarding a potential new drug is not protected by the FDA exemption because that exemption is limited to “clinical” research necessary to obtain ultimate FDA approval of a new drug. That holding is inconsistent with the text of the FDA exemption, reflects a mistaken and unduly narrow view of the types of information relevant to the FDA’s two-step process for evaluating potential new drugs, and is in tension with this Court’s decision in Eli Lilly & Co. v. Medtronic, Inc., 496 U.S. 661 (1990). Moreover, the court of appeals’ decision poses a direct and substantial threat to new drug research by dramatically narrowing the scope of protections enacted by Congress in Section 271(e)(1). Although this case is not an ideal vehicle for considering the issue, see p. 18, infra, the potential impact of the court of appeals’ legal conclusion is sufficiently important that the petition for a writ of certiorari should be granted.

The Court is expected to decide whether to hear the case within the next two months. Wyeth, the AARP, and Eli Lilly are each expected to file Amicus Briefs in support of the petition to rehear the case.

Judge Richard Posner (In Lessig Blog) has advocated the creation of a fair-use exception for patents on research tools:

Link: For example, a generic drug manufacturer is permitted to use the patented drug to demonstrate that its generic equivalent is indeed therapeutically equivalent (the "testing" exception created by the Hatch-Waxman Act). More broadly, an inventor can use the information in the patent to try to invent around the patent. And Landes and I advocate an expansion of the patent fair-use principle to allow scientists to use patented research tools (such as the oncomouse) without license--provided the scientists aren't allowed to use the tools to produce their own patented products!

In response, Lichtman has noted that Judge Posner's proposal "is problematic for the simple reason that, often, the key market for research tools is to sell those tools to other researchers. If a researcher's use of patented research tool is fair use, that would significantly degrade the incentive to create those research tools inthe first place. Moreover, even if your approach works, it is in sharp conflict with the Bayh-Dole instinct that society might very well be better off in a world where academic researchers patent their work. As you know, that legislation was passed in response to evidence that university breakthroughts were sitting on the shelves both because (a) they could not be owned exclusively under old NIH rules; and (b) universities had too little incentive to bring their work to the attention of industry."

Posted by Dennis Crouch | Permalink | Comments (1) | TrackBack

Dec 10, 2004

Owners of Duragesic (R) win patent appeal

Alza v. Mylan Labs., (Fed. Cir. 2004) (04-1344).

Alza sued Mylan for infringement of its patents relating to administration of fentanyl through the skin.  Because fentanyl, a narcotic, is prone to abuse, the inventors developed a patch that minimized the amount of drug that would be used in the system.  The patch is sold by Janssen as Duragesic (R).

Alza won at the district court level.  On appeal, Mylan argued that (i) the claims were not correctly construed and (ii) one of the patents was unenforceable due to inequitable conduct.

Claim construction: The appeals court looked only to the specification and prosecution history to determine that "fentanyl citrate" was not a "skin permeable form" of fentanyl -- thus avoiding prior art.

In determining the meaning of a disputed claim term, a court looks first to the intrinsic evidence of record, examining, in order, the claim language itself, the specification, and the prosecution history.

Inequitable Conduct: The district court found that a statement made by the applicants during prosecution was literally true, but "had the potential to mislead the examiner."  However, on the question of intent, the district court could not find the requisite deceitful intent associated with inequitable conduct. 

The Federal Circuit affirmed: "We discern no clear error or abuse of discretion."

Dissent (in part) by Dyk: Judge Dyk would have found inequitable conduct.

Here, the patentee made an untrue assertion and simultaneously submitted accurate facts not in accord with that assertion.  Such a submission of accurate facts does not cure a false statement.

NOTE: The patent expires January 23, 2005 -- Mylan must wait until then to begin selling a generic version of the patch.

Posted by Dennis Crouch | Permalink

Federal Circuit Rejects Professor's Attempt to Patent Cold Fusion Technique

In re Dash and Keefe (Fed. Cir. 2004) (Unpublished).

In 1990 professor John Dash filed a patent application for producing heat energy using nuclear fusion at a low temperature.  Experimental results suggesting that nuclear fusion occurred in their apparatus were submitted to the Patent Office in support of Dash's attempts to overcome utility rejections mounted by the PTO. 

Dash appealed the Board's rejection of his application for lack of enablement and utility.

On appeal, the CAFC relied on the "scientific community's considerable doubt" regarding the utility of "cold fusion" in sustaining a prima facie case for lack of utility and enablement -- even though the articles relied upon by the PTO were anectodal and not peer-reviewed.

We are aware of no rule that forbids the examiner from relying on related technology, anecdotal information or sources that are not peer-reviewed to establish a case of inoperability. . . .

The Examiner must only establish that a person of ordinary skill in the art would reasonably doubt the asserted utility.

The court then rejected Dash's Rebuttal Evidence:

For each type of evidence Dash produced, the examiner found at least one sound reason to disbelieve the evidence.

Rejection Affirmed.

Comment: (i) All this comes in the wake of the DOE's report that they are accepting quality research proposals on cold fusion. (ii) If this were a published opinion, it would be quite a precedent -- giving some real teeth to the utility requirement. 

Here is the conflict: Applicants use statements from experts saying "a certain result cannot be accomplished" to prove that the result is nonobvious.  Now, the court brings a double-edged sword -- finding that those statements can now be used to show a lack of utility.

Posted by Dennis Crouch | Permalink

Dec 09, 2004

Eolas v. Microsoft On Appeal

Eolas v. Microsoft (04-1234)(On appeal at the Federal Circuit)

At the district court level, Eolas won a $500 million+ verdict for Microsoft's alleged patent infringement.  The technology at issue involves a method of using a web browser to open third-party applications using plug-ins.  Now, the case is on appeal at the Federal Circuit, with oral arguments being held today, December 9, 2004. Microsoft is expected to argue both improper claim construction and error in including Microsoft's foreign sales in damage calculations.

The foreign sales portion of the case falls under 35 U.S.C. 271(f).  271(f)(1) provides for liability for causing components of a patented invention to be supplied for assembly abroad.  In Eolas, however, no physical component of the patented invention had shipped from the U.S.  However, the District Court ruled that Microsoft's shipment of information on a "golden master" disk created a sufficient nexus with the U.S. 

The foreign damages are expected to be overturned by the Federal Circuit appeals court based on its holding in the recent case of Pellegrini v. Analog.  In Pellegrini, the Federal Circuit essentially held that there is no liability for patent infringement unless components of a patented invention are physically shipped from the United States.  Two weeks ago, the Supreme Court denied Pellegrini's petition for writ of certiorari.

The asserted patents are also undergoing a reexamination at the United States Patent Office.

Parties Involved:

The asserted patents are owned by the University of California but exclusively licensed to Eolas.  The two reportedly have an agreement that Eolas will pay the University 25% off the top of any award.  Microsoft is the defendant.  In addition to the parties, a number of amicus briefs were filed by interested parties.  These parties include: AOL; Association for Competitive Technology; Autodesk; Bentley Systems; Intel; Macromedia; Netscape; Oracle; Professor Joe Miller; Sun Microsystems; and Wacom Technology. 

Comment:

Although I have not reviewed these amicus briefs, I expect that they generally support Microsoft's contention that the Eolas patents are invalid and that the reach of the patents should not extend beyond the borders of the U.S.  Paul Festa at cNet has written a brief article on the appeal.

Posted by Dennis Crouch | Permalink

Dec 08, 2004

Supreme Court Upholds Fair Use Defense in Trademark Case: Finds that some consumer confusion is compatible with fair use

KP Permanent Make-Up v. Lasting Impressions I, 543 U.S. ___ (2004).

FACTS: Both KP Permanent Make-Up and Lasting use the term “micro color” in marketing permanent cosmetic makeup.  KP has used a single-word version of the term since 1990 or 1991.  In 1992, Lasting registered a trademark that included the words “Micro Colors” under 15 U. S. C. §1051, and, in 1999, the registration became incontestable, §1065. When Lasting demanded that KP stop using the word “microcolor,” KP sued for declaratory relief, asserting the statutory affirmative defense of fair use, §1115(b)(4). The Ninth Circuit ruled consumer confusion is an element of fair use and appeared to place the burden of proof (to show an absence of confusion) on KP.

ISSUE: Does a party raising the defense of fair use to a claim of trademark infringement have a burden to negate any likelihood that the practice complained of will confuse customers about the origin of goods or services affected?

HOLDING: (Souter) A party raising the statutory affirmative defense of fair use to a claim of trademark infringement does not have a burden to negate any likelihood that the practice complained of will confuse consumers about the origin of the goods or services affected.

(a) Even if a mark is incontestable (under §1115(b)), a trademark holder has the burden of showing that the defendant’s actual practice is “likely to cause confusion, or to cause mistake, or to deceive” consumers about the origin of the goods or services in question, see, e.g., Two Pesos, Inc. v. Taco Cabana, Inc., 505 U. S. 763, 780.  While cases such as Baglin v. Cusenier Co., 221 U. S. 580, are consistent with taking account of the likelihood of consumer confusion as one consideration in deciding whether a use is fair, they cannot be read to make an assessment of confusion alone dispositive or provide that the defense has a burden to negate it entirely.

(b) Since the burden of proving likelihood of confusion rests with the plaintiff, and the fair use defendant has no free-standing need to show confusion unlikely, the Court recognizes (contrary to the Ninth Circuit’s view) that some possibility of consumer confusion is compatible with fair use. . . . The Court does not rule out the pertinence of the degree of consumer confusion under the fair use defense.

(c) VACATED and REMANDED.

Supreme Court Opinion
9th Circuit Opinion

 

Posted by Dennis Crouch | Permalink

Dec 07, 2004

Conclusory Statements by Patent Examiner are Inadequate to Support Motivation to Combine References

In re Bruce Beasley (Fed. Cir. December 7, 2004) (04-1225 Unpublished Opinion).

In 1991, Beasley filed a patent application directed to the generation of images on a video screen using a light pen that operates by mapping the screen into a memory on a point-by-point basis. 

The patent appeals board (BPAI) found that the invention was obvious based on prior art patents cited by the patent examiner during prosecution.  Beasley then appealed to the Court of Appeals for the Federal Circuit (CAFC).

On appeal, Beasley argued that the examiner never established a prima facie case of obviousness.  Specifically, Beasley urged reversal because there was no motivation or suggestion to combine the references cited by the Examiner and BPAI.

The Court agreed with Beasley and reversed the BPAI's rejection -- finding that:

The record reflects that the examiner and the Board have managed to find motivation for substituting one type of memory for another without providing a citation of any relevant, identifiable source of information justifying such substitution. The statements made by the Examiner, upon which the Board relied, amount to no more than conclusory statements of generalized advantages and convenient assumptions about skilled artisans. At least under the MPEP then in effect, such [conclusory] statements and assumptions are inadequate to support a finding of motivation, which is a factual question that cannot be resolved on subjective belief and unknown authority.

Vacated and Remanded.

In Dissent, Judge Dyk would have affirmed the obviousness rejection.

I see no error in the Board’s reliance on the PTO’s own specialized knowledge [for a motivation to combine]. The effect is merely to create a prima facie case, and to shift the burden to the patent applicant. Here the applicant did not refute the factual findings of the Board and the patent examiner, but merely offered lawyer argument to contradict the Board’s findings. Under these circumstances the application was properly rejected.

With this said, I agree that the MPEP provision in effect at the time is not a model of clarity and can be read as recognizing only a very limited scope for the use of the PTO’s expertise. MPEP § 2144.03 (7th ed. 1998). However, the current version appears to allow greater latitude. MPEP § 2144.03 (8th ed., rev. 2, 2004). In future cases, where the PTO has provided us with an interpretation of the new MPEP provisions, we will need to address the extent to which the new version of the MPEP gives the PTO greater scope to rely on its own expert knowledge.

 

Posted by Dennis Crouch | Permalink

Dec 06, 2004

Amazon wins patent suit . . . for now: Pinpoint's case dismissed without prejudice

Pinpoint v. Amazon (N.D. Ill. December 6, 2004) (No. 03 C 4954, Richard A. Posner, sitting by designation).

After an evidentiary hearing on the eve of trial, Judge Posner has determined that Pinpoint was not the owner of the asserted patents at the time the complaint was filed -- and thus, that Pinpoint does not have standing to sue.

The case was dismissed without prejudice.  After ensuring that the patents are properly assigned, Pinpoint may re-file the suit.

Read the opinion here: Download Pinpoint.pdf.
Read more about the lawsuit here, here, and here. 

Posted by Dennis Crouch | Permalink

CAFC: Expert Testimony Essential for Finding of Infringement

Centricut v. ESAB (Fed. Cir. 2004) (03-1574).

At the district court, Esab Group won a multi-million dollar judgment against Centricut for infringement of Esab's patent relating to plasma welding products.  Centricut appealed the judgment and the measurement of damages.  Esab cross-appealed, asking for a modification of the judgment on damages.

On appeal, Centricut argued that ESAB had not satisfied its burden of proof on infringement because it failed to present expert testimony comparing the claims as construed with the accused device.  The Appeals Court agreed that expert testimony was essential in this case:

[E]ach of Esab’s three theories [of infringement] suffers from the same deficiency: none is supported by expert testimony. The first theory, adopted by the district court, rests on the district court’s own interpretation of the evidence. The latter two theories rest on the testimony of witnesses who were admittedly not experts on [the specific technology].

... This case stands as an apt example of what may befall a patent law plaintiff who presents complex subject matter without inputs from experts qualified on the relevant points in issue when the accused infringer has negated infringement with its own expert.

Infringement Reversed

The Court went on to say that experts are not necessary for cases where the technology is "easily understandable." And, that there is no "per se rule that expert testimony is required to prove infringement when the art is complex."  However, "where the accused infringer offers expert testimony negating infringement, the patentee cannot satisfy its burden of proof by relying only on testimony from those who are admittedly not expert in the field." 

Posted by Dennis Crouch | Permalink

Dec 02, 2004

35 U.S.C. 103(a): Disclosure of alternative embodiments does not constitute teaching away.

In a case involving the design of shoe tred, the Federal Circuit provided further insight into the motivation to combine references under 103(a).

In re Fulton (Fed. Cir. 2004) (04-1267).

After receiving an obviousness rejection at the Board of Patent Appeals and Interferences (BPAI), inventors Fulton and Huang appealed to the Federal Circuit.  Their utility patent application is directed to a shoe sole with increased traction.  The BPAI found that the prior art as a whole suggested a combination of the orientation of hexagonal surfaces found in the application. 

Motivation to Combine Need Not Come from Preferred Alternatives: On appeal, the inventors argued that there was no motivation to combine because the characteristics disclosed in the references were not the preferred alternative.  The CAFC rejected this argument -- finding that "our case law does not require that a particular combination must be the preferred or the most desirable, combination described in the prior art in order to provide motivation for the current invention."  The appeals court went on to clarify that the "prior art's mere disclosure of more than one alternative does not constitute a teaching away from any of these alternatives" unless the disclosure criticizes, discredits, or otherwise discourages the solution.

Rejection for obviousness affirmed.

Posted by Dennis Crouch | Permalink

Carlos Gutierrez nominated as Secretary of Commerce

Kellogg Executive Carlos Gutierrez has been nominated by President Bush to replace Don Evans as Secretary of Commerce.  The Commerce Department manages the Patent & Trademark Office as well as other utilitarian functions of the government such as the census, weather forecasting, and standard setting.

Gutierrez fled Castro's Cuba in the 1960's and worked his way up the corporate ladder -- eventually taking the helm at Kellogg in 1999.  He is credited with revitalising the company that had been knocked from its perch at the top of the cereals business.

Bush called Gutierrez a "great American success story" and a visionary executive, who understands the world of business from the "first rung on the ladder to the very top."

Kellogg is no stranger to the PTO, more than sixty years ago Kellogg brought a case to the Supreme Court over whether the pillow shape of Nabisco's shredded wheat was trademarked.  In Kellogg v. National Biscuit, the Court ruled that a "product shape that is the subject of a [utility] patent goes into the 'public domain' when the patent expires." 306 U.S. 111 (1938).

Posted by Dennis Crouch | Permalink

Dec 01, 2004

Marking Estoppel: CAFC Vacates but Leaves Possibility

Slip Track Systems v. Metal Lite (Fed. Cir. December 1, 2004) (unpublished) ("Slip Track III").

In a long-running dispute involving patents directed to earthquake resistant wallboard structures that permit a wallboard to slide vertically with respect to the supporting wall studs, the Federal Circuit vacated the district court's infringement holding.

The district court barred Defendant Metal Lite from contesting infringement for three reasons. 1) Because of a prior partnership with Slip Track, Metal Lite had marked its product with the asserted patent number -- thus creating a marking estoppel. 2) In an earlier decision, ("Slip Track II"), the CAFC had found the asserted patent to cover identical subject matter as another product that Metal Lite admittedly infringed -- thus, Metal Lite must also infringe the asserted patent. And 3) Metal Lite's tardy presentation of non-infringement arguments were contrary to Fed. R. Civ. Pro. R. 26 of "fully airing each parties' theories of the case well in advance of trial."

On appeal, the CAFC vacated-in-part:

Marking Estoppel: While deliberate mismarking of a product may provide grounds for applying estoppel, there is no evidence in this case that Metal Lite believed its product to fall outside the scope of the patent's claims when it made the decision to mark its product.  Thus, marking estoppel does not apply in this case. 

NOTE: The Court explicitly refused to endorse the doctrine of marking estoppel -- "We find it unnecessary to address this issue because, even assuming the doctrine remains viable, it does not apply to the facts of this case."

Identical Scope of Second Patent: Patent infringement analysis requires the court to compare construed claims to the accused product. In bypassing this step, the district court failed to consider that Metal Lite's products do not necessarily infringe the patent.

Metal Lite's Litigation Conduct: In its answer, Metal Lite denied infringement -- and thus, was not tardy.

Accordingly, we hold that the district court abused its discretion in granting Slip Track's motion in limine barring Metal Lite from contesting infringement.

In Dissent: Judge Newman could "not discern reversible error."

Posted by Dennis Crouch | Permalink

Mobile Phone Manufacturers Win Design Patent Suits

Earlier this month, the Federal Circuit ruled that Tony Colida's patented cell phone design was not infringed by Matsushita's GU87 phone.  (link).  Now, Colida's parallel suit against Kyocera Wireless and Sanyo have been struck down. 

Colida v. Sanyo (Fed. Cir. December 2, 2004) (unpublished)

A design patent is for the visual appearance of a useful article. Durling v. Spectrum Furniture Co., 101 F.3d 100, 104-05 (Fed. Cir. 1996). To infringe a design patent, the accused device must have substantially the same appearance as the patented device, and contain the points of novelty as compared with the prior art, such that the ordinary observer would believe that they are the same product.

We agree with the district court that there is no view of the facts whereby a reasonable trier of fact could find infringement, and that summary judgment of non-infringement was properly entered.

Judgment of non-infringement affirmed.

============================================

 

Kyocera v. President Electronics and Tony Colida (Fed. Cir. November 30, 2004) (unpublished).

Mr. Colida [] argues that the Kyocera 2200 phones are substantially similar to the design in the '184 patent. The district court pointed to significant differences in the Kyocera 2200 phones, in that they do not have as pronounced a curvature, have additional buttons taller screens, and different arrays of holes in the earpiece.

[T]he district court's summary judgment of non-infringement has not been shown to be incorrect. Error has not been shown as to the district court's analysis. The district court's identification of the many differences in the features of the designs has not been disputed.

The judgment of non-infringement is affirmed.

============================================

Colida v. Matsushita (Fed. Cir. 2004) (unpublished opinion).

Facts: Tony Colida owns design patents covering the design of mobile phones designated A.  Matsushita owns a patent on the design for mobile phone B.  In addition Matsushita makes a GU87 phone that matches up with its patented design.  After comparing the phone with the figures from Colida's patents, the district court dismissed Colida's infringement suit - finding that there was no infringement as a matter of law.

Appeal: Reviewing the summary judgment de novo, the appellate panel affirmed, finding no error in the district court's conclusion that "no reasonable trier of fact could find infringement of the [patents] by the GU87 phone in this case."

Summary Judgment of Noninfringement Affirmed.

Posted by Dennis Crouch | Permalink

Nov 30, 2004

Federal Circuit: Claims Should Be Interpreted for Internal Consistency and Operablility

Frank's Casing Crew v. Weatherford Intl. (Fed. Cir. 2004).

Frank's Casing owns a patent on a device for remotely controlling an oil-well casing.  (U.S. Patent No. 5,049,020). Because sections of casing can be up to 36 inches in diameter and weigh 300 pounds per foot, manual alignment is difficult and poses a significant risk of injury.  Frank's Casing brought suit against Weatherford, charging patent infringement.

The district court (W.D. Oklahoma) granted summary judgment of noninfringement after interpreting the means-plus-function claim language of Frank's patent. 

On appeal, Frank's Casing argued that the district court improperly imported structure into the term "means for selectively pivoting" that was unnecessary to perform the function of pivoting a boom about a horizontal axis. 

The Federal Circuit affirmed, finding that the district court's interpretation is necessary and "to conclude otherwise would render the patent internally inconsistent and the invention inoperable."

Noninfringement Affirmed.

Posted by Dennis Crouch | Permalink

Nov 29, 2004

Judge Posner to hear Amazon Patent Case

Pinpoint v. Amazon. (N.D. Ill. Aug 31, 2004) (Posner, J.).

Pinpoint has sued Amazon for infringement of its patented system for scheduling broadcast and providing access to video programs. (E.g., U.S. Patent No. 5,758,257). Pinpoint claims that Amazon's website infringes by providing personalized book and music video suggestions. 

In its most recent press release, Pinpoint announced that Judge Richard A. Posner of the 7th Circuit, U.S. Court of Appeals will be sitting by designation as the district judge presiding over the jury trial.  According to Judge Posner's order in the case, the jury trial will begin at 9:00 am on December 6.

Always Controversial

Judge Posner has a reputation for thinking outside the box.  In his last patent case, Posner created a new equitable defense to infringement that would bar enforcement of a patent when the patentee’s own conduct significantly inhibits non-infringing practice of the prior art.  That case, SKB v. Apotex [I, II, III, IV], involving hemihydrates, was affirmed by the Federal Circuit but is currently being considered for an en banc rehearing. 

It is speculated that the Apotex case has sparked some contention within the halls of the CAFC.  This speculation stems from the fact that the en banc petition has been sitting undecided for over six months.

Now a Blogger

After a stint as a guest blogger at Professor Larry Lessig's blog, Judge Posner has started a blog in cooperation with Nobel Winner Gary Becker.  The Becker-Posner blog is not fully functional yet, but keep your eyes peeled.

Links:
My Prior Post on Pinpoint v. Amazon
More Info on the Pinpoint v. Amazon

Posted by Dennis Crouch | Permalink

Nov 28, 2004

Coolsavings wins patent appeal

Catalina Marketing v. Coolsavings (Fed. Cir. 2004) (03-1548) (unpublished).

Catalina owns a patent on a method for distributing electronic coupons. Coolsavings runs a website that uses user demographics to target coupon offers. Catalina sued Coolsavings for Infringement. Catalina appeals the district court's claim construction and subsequent dismissal for noninfringement.

On appeal, the Federal Circuit affirmed the district court's opinion, finding that the District Court had properly construed means-plus-function language by importing limitations from the specification.

Dismissal of Catalina's Infringement suit Affirmed.

Posted by Dennis Crouch | Permalink

Nov 17, 2004

McFarling v. Monsanto: On Petition for Writ of Certiorari

McFarling v. Monsanto (Supreme Court Docket No. 04-31).

After being shut-out at the district and appeals courts, Mississippi Delta Farmer Homan McFarling has petitioned the Supreme Court of the United States for a writ of certiorari -- asking the high court to hear his case.

Roundup-Ready (R) soybeans have become extremely popular in the the U.S.  The genetic modification added by Monsanto allows soybean plants to resist the broad-leaf herbicide.  Monsanto's patents on the genetically modified seed is even more important now because Roundup has gone off-patent. 

When a farmer purchases seeds from Monsanto, the company requires that the farmer agree not to retain any seeds from the resulting crop for replanting.  These second generation seeds are genetically identical to the ones originally purchased -- and thus, fall under the scope of the patents.  Monsanto brought suit against McFarling after the farmer violated his agreement and saved second generation soybean seeds to replant his 5,000 acre farm.

McFarling now questions whether Monsanto has any right to control the trade of the second generation seeds -- Is Monsanto's limitations on use of the second generation seeds an unlawful restraint of trade?

In my quick review of the briefs for and against certiorari, it appears that Monsanto's attorneys have put their best foot forward by showing that there are no true circuit splits, a key feature in the Supreme Court's decision whether to accept a case on appeal.  All the same, McFarling's case has a certain flair that may push the court to accept the case.

Links:

• McFarling Petition [PDF]
• Monsanto Opposition [PDF]
• Questions on Appeal
• Federal Circuit Case
• Monsanto v. Ralph

Posted by Dennis Crouch | Permalink

Nov 15, 2004

Supreme Court Requests Bush Administration's View on Seed Patent Controversy

McFarling v. Monsanto (Supreme Court Docket No. 04-31).

Homan McFarling was sued by Monsanto for saving seeds and replanting them.  The seeds had been genetically modified by Monsanto to resist Roundup (R) herbicide and were patented. (U.S. Patents 5,633,435 and 5,352,605). 

At the Federal Circuit, McFarling argued that the Sales Agreement from Monsanto involved an unlawful misuse of Monsanto’s patents by restricting use of “god-made” second-generation seeds. The Appellate Court disagreed. Because the first-generation seeds (sold by Monsanto) were nearly identical copies to the second-generation seeds, the Court found that the patent scope includes both generations. Thus, the Court rejected McFarling's appeal and held that the Sales Agreement did not impermissibly extend Monsanto's rights.

Now, McFarling has taken the suit to the Supreme Court.  In case No. 04-31, McFarling is asking the Court to to overturn the Federal Circuit's ruling and presents two questions:

1. May a patent holder lawfully prohibit farmers from saving and replanting seed as a condition of the purchase of patented technology?

2. Does obtaining patents on products which are the subject of licensing agreements afford an absolute defense to any claim that the licensing agreements violate the Sherman Act?

The Supreme Court has asked the Solicitor General to brief in this case expressing the views of the United States.  It is expected that the Bush Administration, through the Solicitor General, will support Monsanto's position. 

Posted by Dennis Crouch | Permalink

Nov 10, 2004

Military Contractor Forfeits Patent Rights: Company Failed to Properly Disclose Invention

Campbell Plastics v. Les Brownlee, Secretary of the Army (Fed. Cir. November 10, 2004) (03-1512). 

The Case:

In 1992, Campbell Plastics (as it is now known) entered into a cost-plus-fixed-fee contract with the Army to develop components of an aircrew protective mask. Section I of the contract required Campbell to disclose any invention developed pursuant to the government contract and further provided that the government could obtain title if Campbell failed to disclose the invention within two months.

Campbell invented a new type of gas mask, but the company did not disclose the invention to the Government. Campbell then obtained a patent on the invention, noting that the Government has a "paid-up license in this invention." 

The government, however, wanted more than just a license.  In a decision by the Armed Services Board of Contract Appeals, ruled that Campbell had forfeited title to the patent by failing to comply with disclosure requirements of the contract.

The Appeal:

The Federal Circuit Court of Appeals, interpreting both the Bayh-Dole Act and the contract, sided with the Army.

Campbell Plastics failed to comply with the disclosure provisions of the parties' contract. The contract unambiguously provides that in such a case, the government may obtain title to the subject invention. The decision of the Board to deny Campbell Plastic' appeal is affirmed.

The Result:

Campbell failed comply with its contract to disclose inventions to the Army.  As a result, the Army may obtain title to the related patents.

Comment: This case should serve as a warning to government contractors. You cannot rely on the friendly face of the Technology Tranfer Office always being there. Contractors should implement a regular practice of documenting engineering work associated with government contracts to ensure that inventions are accurately reported in a timely manner.

Posted by Dennis Crouch | Permalink

Nov 09, 2004

University of New Mexico v. Knight

University of New Mexico v. Knight (Fed. Cir. November 9, 2004) (unpublished).

After an earlier remand from the Federal Circuit, defendants Knight and Scallen attempted to amend their counterclaims to indicate precisely how they were damaged by actions arising from the University's actions. However, the district court denied their motions to amend and dismissed all but one counterclaim as barred by the statute of limitations and the New Mexico Tort Claims Act.

On appeal, the appellate panel again sided with the University, finding that Scallen and Knight's arguments to be "without merit."  Barring a rehearing or appeal to the Supreme Court, this case is closed.

Link: Senior U.S. District Judge John Conway said it was unfortunate the university's lawsuit against two former UNM researchers was not resolved by cooperation and "searching for the greater good" outside the courts to benefit cancer patients.

Posted by Dennis Crouch | Permalink

Nov 08, 2004

Patent holder barred from reopening malpractice arbitration

Theis Research v. Brown & Bain (Now Perkins Coie) (9th Cir. 2004).

B&B was Theis’s attorney in patent litigation that turned out badly. Theis demanded arbitration of claims against B&B for legal malpractice, breach of fiduciary duty, fraud and breach of contract. In commenting on the litigation that spawned the arbitration, the arbitrator stated:

Viewed as a whole, the litigation that is the subject of this arbitration was an almost unmitigated disaster both for [Theis] and for B&B. The hopes of [Theis] and its investors were dashed; years of work by Mr. Theis and others went unrequited; B&B got no return on millions of dollars of invested time, and had to chalk up a major loss on its results chart.

The arbitrator awarded no compensation for Theis.  Theis then filed a lawsuit for damages and to vacate the arbitration award.

On appeal, the Ninth Circuit first determined that the amount in controversy was sufficient for federal jurisdiction even though the arbitration award had been zero.  The Appellate Panel then Affirmed, finding that Theis could not re-open arbitration as he had not shown that the "arbitral result ... was a manifest disregard of the law, an implausible interpretation of the contract, the award was procured by corruption, fraud, or undue means, or the arbitrator exceeded his powers."

2004 U.S. App. LEXIS 21753

Posted by Dennis Crouch | Permalink

Federal Court has no jurisdiction over suit to recover patent-infringement litigation proceeds

General Technology Applications v. Exro (4th Cir. 2004).

GTA and Exro pursued a joint business venture to produce and market a drag reduction additive (DRA) for petrolium products.  The startup company, EXG, never successfully produced or marketed any DRA.  However, GTA successfully sued Conoco for infringement of its DRA patents -- $60 million.  Neither EXG or Exro were parties to that litigation. 

Once Exro learned of the award, it demanded its share.  According to Exro, EXG held an exclusive license to the GTA patents, thus making the infringement award property of EXG.  However, the district court dismissed Exro's claims on summary judgment.

On appeal, the 4th Circuit Court of Appeals reversed -- finding that the district court lacked diversity jurisdiction over the claims.  The case remanded to Virginia state court.

Posted by Dennis Crouch | Permalink

Nov 07, 2004

Federal Circuit Court of Appeals warns that future appellate rule violations will likely result in sanctions

In Re Violation of Rule 28(c) (Fed. Cir. 2004) (Unpublished Order)

At the district court, Esab Group won a multi-million dollar judgment against Centricut for infringement of Esab's patent relating to plasma welding products.  Centricut appealed the judgment and the measurement of damages.  Esab cross-appealed, asking for a modification of the judgment on damages.

While not yet deciding on the merits of the case, the Federal Circuit gave Esab's attorney a written reprimand for filing a reply brief in violation of Rule 28(c) of the Federal Rules of Appellate Procedure. 

Rule 28(c) limits the content of a cross-appeal reply brief to issues presented by the cross appeal.  Further, the Practice Notes accompanying Rule 28 specifically caution counsel to limit the reply brief "to the issues presented by the cross-appeal."   However, Esab's reply brief consisted of 23 pages, about 20 of which related only to the main appeal and not the cross appeal.

The appellate panel declined to impose sanctions against the offending attorney, but noted that "we wish to make clear that it is the duty of counsel to familiarize themselves with applicable rules, and that, in future cases, serious violations of applicable rules, whether or not 'inadvertent,' will potentially subject counsel to sanctions."

A decision on the merits of Centricut v. Esab Group is expected later this year.

Notes:

Fed. R. App. P. 28(c) Reply Brief. The appellant may file a brief in reply to the appellee's brief. An appellee who has cross-appealed may file a brief in reply to the appellant's response to the issues presented by the cross-appeal. Unless the court permits, no further briefs may be filed. A reply brief must contain a table of contents, with page references, and a table of authorities-cases (alphabetically arranged), statutes, and other authorities with references to the pages of the reply brief where they are cited.

 

Posted by Dennis Crouch | Permalink

Nov 04, 2004

Dell sued for infringement of international e-commerce patent

DE Technologies v. Dell

DE Technologies owns the patent on multi-lingual e-commerce.  (U.S. Patent No. 6,460,020). The patent, originally filed in 1997, covers a method carried out on a computer that allows international commercial transactions.  Claim 1 of the patent includes the following steps: 

(a) selecting a language from a menu;
(b) selecting a currency from a menu;
(c) selecting a product to be purchased and a destination for shipping;
(d) obtaining from a database i) price information; ii) an international goods classification of the product; and iii) international shipping information;
(e) calculating shipping costs;
(f) determining a total cost;
(g) confirming existence of available funds; and
(h) accepting the order and generating a shipping invoice

Yesterday, BusinessWeek reported that DE has sued Dell for infringement of this patent.  According to the article, If litigation goes forward, it will focus on whether, as DE contends, it really was the first company to demonstrate a system for processing international sales online when it filed for patent protection in 1997.

(Thanks Lisa).

Posted by Dennis Crouch | Permalink

Nov 03, 2004

District Court's Review of Figures in Design Patent Sufficient for Summary Judgment.

Colida v. Matsushita (Fed. Cir. 2004) (unpublished opinion).

Facts: Tony Colida owns design patents covering the design of mobile phones designated A.  Matsushita owns a patent on the design for mobile phone B.  In addition Matsushita makes a GU87 phone that matches up with its patented design.  After comparing the phone with the figures from Colida's patents, the district court dismissed Colida's infringement suit - finding that there was no infringement as a matter of law.

Appeal: Reviewing the summary judgment de novo, the appellate panel affirmed, finding no error in the district court's conclusion that "no reasonable trier of fact could find infringement of the [patents] by the GU87 phone in this case."

Summary Judgment of Noninfringement Affirmed.

Posted by Dennis Crouch | Permalink

Oct 29, 2004

Patent Case: Bard v. United States Surgical

Bard v. U.S. Surgical (Fed. Cir. 2004). 

Bard owns a patent on a method of repairing hernias with a flexible mesh plug. Bard sued U.S. Surgical for infringement and for inducing surgeons to infringe. Because in the prosecution history and specification Bard defined the claimed plug as having pleats, the district court's claim construction requiring "pre-formed pleats" was affirmed.  Noninfringement affirmed.

Concurrence by Judge Prost:

In this case, the inventors clearly and deliberately disclaimed any coverage of non-pleated plugs they might otherwise have had when they stated during reexamination that “the surface of the inventive plug is pleated” in an attempt to overcome the prior art-based rejections of claims 19 and 20. Under the theory that the inventors acted as lexicographers, the majority holds that this statement, among others, shows that the inventors “clearly defined the plug of claim 20 as having pleats.”  The statement, in my view, is a surrender of claim scope, which precludes Bard from recapturing coverage of non-pleated plugs. Litton Sys., Inc. v. Honeywell, Inc., 140 F.3d 1449, 1458 (Fed. Cir. 1998). Because the inventors clearly disclaimed coverage of non-pleated plugs in the reexamination, I believe we may affirm the judgment of the district court on that basis alone; accordingly, I find it unnecessary to reach the remaining grounds for affirmance relied upon by the majority.

 

Posted by Dennis Crouch | Permalink

Patent Suit Alleges Disney Stole fastPass Idea

Disney's patented fastPass system allows customers to reserve a time to ride an attraction, rather than waiting in line.  (U.S. Patent No. 6,173,209). 

According to a report by Sean Mussenden at the Sun Sentinel, a Tennessee man has sued Disney for stealing his idea for the line management system. 

After Robert Keyes watched a man pass out in a ride queue at Disney-MGM Studios, he had an epiphany, he said: Theme park visitors do not have to stand in line.

So, according to a patent lawsuit Keyes filed this month in federal court in Orlando, he sent a letter to Disney executives in 1991 describing a system that would allow some theme-park visitors to wait in a "standby" line but give others a ticket to return later and avoid the wait.

A top Disney executive sent him a letter back a month later, telling him the idea wouldn't work and would result in "more guest inconvenience," according to Keyes' lawsuit.

Now, Keyes has sued Disney for "stealing his idea."  In the complaint, he has requested correction of inventorship and damages for unjust enrichment.

On their website, Disney notes that "we are unable to accept or examine any creative idea, suggestion or document other than those solicited by the company itself.  We hope that you understand the aim of this policy, which is designed to prevent any future misunderstandings or problems which might arise if projects developed by [Disney] were to show a resemblance to creative work originated from third parties."

Links:
Download the complaint against Disney.
Download Disney's patent.

In a parallel case, the 9th Circuit Court of Appeals, in Jeff Grosso vs. Miramax Film Corp., found that movie and television executives enter an implied contract every time they read a script or hear a pitch.

Posted by Dennis Crouch | Permalink

Oct 28, 2004

Caterpillar Jury Trial Vacated Because Juror's Spouse Was an Employee

Caterpillar v. Sturman (Fed. Cir. October 28, 2004). 

The Court of Appeals for the Federal Circuit (CAFC) today vacated a jury verdict in a trade secret and contract dispute involving Caterpillar. 

The technology at issue involved the use of residual magnetic latching in a fuel injector.  (See, for example, U.S. Patent 3,646,898).  The Appellate Panel, led by Judge Newman, decided several important issues in this case.  One of the most interesting involved Juror No. 3 whose spouse was a current Caterpillar employee.

At the beginning of trial, during the jury selection process, Sturman moved to dismiss for cause any current or former Caterpillar employees and their spouses. The district court denied Sturman’s blanket objection, but specifically allowed Sturman to show cause for individual jurors. . . . Sturman did not individually challenge for cause Juror No. 3, the spouse of a current Caterpillar employee, nor did it use one of its peremptory challenges to have her removed. Juror No. 3 ultimately sat on the jury.

Sturman appealed the district court's opinion to allow Juror No. 3 to sit on the jury.

Potential for bias reviewed de novo.

Normally, the question of whether an individual juror is biased is a factual determination entitled to deference on appeal.  However, the CAFC ruled that a district court's decision on "implied bias, as opposed to actual bias" is reviewed de novo.

Spouse of Employee is Biased as a Matter of Law.

Applying Seventh Circuit law, the court found that implied bias is demonstrated by "showing that the juror has a personal connection to the parties or circumstances." 

Juror No. 3 had a financial interest in this case because her husband worked for Caterpillar at the time of the trial. As noted in Polichemi, even a tiny financial interest is enough to warrant dismissal. And it is legally irrelevant whether this financial interest arose due to his employment in management or under a union contract. . . . In addition, we find no distinction in the law between the financial interest of an at-will management employee and the interest of an employee under a union contract, nor do we advocate creating one.

Jury verdict vacated. Case remanded for a new trial.

Posted by Dennis Crouch | Permalink

Oct 25, 2004

Patents: Federal Circuit Defines Requirements For Declaratory Judgment Action

Capo v. Dioptics (Fed. Cir. 2004).

Background

Dioptics produces "wear-over" sunglasses that are adapted to fit over or clip onto eyeglasses.  Capo is a wholesale marketer of sunglasses.  Prior to suit, the president of Dioptics (Henry Lane) called the president of Capo (Mark Ascik):

Lane left a voice mail message stating that if he did not hear promptly from Ascik, he would have to "presume that you are just ducking and racing forward to infringement;" Lane cautioned Ascik about "charging down a path here that's going to end up into a multi-million dollar lawsuit." Ascik then phoned Lane, and Ascik's affidavit states that Lane said that Dioptics had thirteen United States patents and would soon have forty, and that these patents covered all of the basic wear-over sunglass frame shapes. Lane said that Dioptics would have no choice but to defend its patents against infringement, and that he was sure he would win an infringement suit.

After the conversations, Capo filed a declaratory judgment complaint, asking for a preemptive noninfringement holding.  Dioptics moved for dismissal of the declaratory action, on the ground that Dioptics could not have threatened suit because no one at Dioptics had seen Capo's product or analyzed it for infringement.

The district court dismissed the declaratory action, finding that the dispute was not "sufficiently crystallized" for declaratory action.  On appeal, the Federal Circuit reversed:

Objective Apprehension Of Being Sued Sufficient For Declaratory Judgment Action.

Dioptics' argument that it could not have ethically filed suit at that time may be relevant to whether Dioptics acted responsibly, but it is irrelevant to whether the patentee's threats of suit instilled a reasonable apprehension of suit.  Although Dioptics now characterizes Lane's words as "cursory," the record well supports the conclusion that Capo had the objectively reasonable apprehension that it would be sued by Dioptics for patent infringement. This objective apprehension was deliberately and intentionally created by the president of Dioptics. It is irrelevant whether Dioptics had adequately investigated the basis of its threats, if they created the requisite objective apprehension. . . . We conclude that the district court clearly erred in declining to find that Capo had a reasonable apprehension of suit.

Failure to Raise Counterclaims Does Not Warrant Dismissal.

The district court gave weight to Dioptics failure or refusal to make compulsory counterclaims for infringement.  The Appellate Court found that Dioptics' waiver of the claims should not add any weight to the argument for dismissal.

The Existence of Pending Patent Applications Does Not Justify Dismissal.

The district court also gave weight to Dioptics' argument that it had pending patent applications that upon issuance would strengthen its case for infringement.  The Appeals Court disagreed with this finding:

Capo is entitled to resolution of the infringement accusations already made, for the patents that already exist. The possibility of future patents is irrelevant to present rights and liability.

Conclusion

Resolution of this dispute is within the court's capability, and it is the district court's responsibility to resolve it. Declining to do so is an abuse of discretion.

We conclude that the dismissal was improperly granted. The dismissal is vacated, and the case is remanded for further proceedings.

 

Posted by Dennis Crouch | Permalink

Oct 22, 2004

Federal Circuit Denies Petitions to Rehear

Today, the Federal Circuit, without opinion, denied several petitions for rehearing en banc:

• Toro v. White Consolidated Industries petition for rehearing DENIED.
• Home Diagnostics v. LifeScan petition for rearing DENIED.
• Chamberlain Group v. Skylink Technologies petition for rehearing DENIED.

Earlier this week, the CAFC denied petitions for en banc rehearings in Monsanto v. Ralph and International Rectifier v. IXYS.

Barring an appeal to the United States Supreme Court, the holdings on appeal represent the final rule of law.

Posted by Dennis Crouch | Permalink

California Appeals Court Upholds Genentech Verdict

City of Hope v. Genentech (Cal. App. 2004) (B161549). 

Decision: A California state appellate court has upheld a $500 million verdict against Genentech for back payment of royalties on drug sales from a 1976 agreement with City of Hope National Medical Center.  The court found that Genentech breached a fiduciary duty to City of Hope.

Genentech does not dispute that it failed to disclose various licenses and pay royalties on those licenses. Rather, it contends that it did not breach any fiduciary duty so long as it was adhering to an erroneous but legally tenable interpretation of the agreement. In essence, Genentech would have us hold that even if it followed an interpretation it knew was contrary to what the parties intended and agreed upon, it could not be held liable so long as that interpretation was objectively sustainable under the law. . . . None of [the cases cited by Genentech] allows a party to profit from a legally tenable contract interpretation when the party knows that the agreement has a wholly different meaning. In any event, it would be antithetical to the very nature of the obligations imposed on fiduciaries for us to hold that a fiduciary could act in the manner suggested by Genentech.

To the extent Genentech contends that its interpretation of the agreement was held in good faith, that contention fails. The jury’s finding of fraud or malice demonstrates that it believed that Genentech acted in bad faith. That finding . . . is supported by substantial evidence and is sufficient for concluding that Genentech breached its fiduciary duty.

According to a California based patent attorney, several amici curiae -- including Intel Corp., TechNet and the California Chamber of Commerce -- pleaded with the court to reverse the judgment, saying that imposing fiduciary status as a cost of using third-party intellectual property would impede innovation.  Genentech has announced its plans to appeal the decision to the California Supreme Court.

About the Case: In 1978, City of Hope biologists Arthur Riggs and Keiichi Itakura developed a technique for splicing into a bacteria gene the DNA for human insulin, which became the world's first biotechnology drug. Genentech agreed to pay City of Hope 2% on net sales of products that were tied to the DNA provided by the cancer center.  (see Patent No. 4,704,362). Royalties had been paid for sales of insulin and on sales growth hormone products, but the cancer center is asking for royalties on products made under 20 other license agreements. 

Posted by Dennis Crouch | Permalink

UK High Court Rejects Doctrine of Equivalents

Hal Wegner recently reviewed the House of Lords case of Kirin-Amgen v. Hoechst Marion.  This case presented the first opportunity for the British high court to interpret the "new" patent law (introduced a quarter-century ago).

According to Hal, the court "held that the 'purposive construction' test for determination of patent scope should be maintained and is consistent with the European Patent Convention. The doctrine of equivalents as an alternative test is expressly repudiated."

There will be occasions upon which it will be obvious to the skilled man that the patentee must in some respect have departed from conventional use of language or included in his description of the invention some element which he did not mean to be essential. But one would not expect that to happen very often.

In rejecting the American style doctrine of equivalents, the Lord Hoffman noted that:

I cannot say that I am sorry [that our precedent is antithetical to a doctrine of equivalents] because the Festo litigation suggests, with all respect to the courts of the United States, that American patent litigants pay dearly for results which are no more just or predictable than could be achieved by simply reading the claims.

Posted by Dennis Crouch | Permalink

Oct 21, 2004

Invention Submission Corporation versus Jon Dudas, USPTO Director

In January 2002, the PTO initiated an advertising campaign to warn the public of invention promotion scams. In a press release describing the campaign, the PTO noted that the agency's advertisements would feature "an actual inventor, Edward Lewis, who lost several thousand dollars." In the advertisements, Lewis described how he had spent $13,000 dollars on the services of an invention promotion company but "ha[d]n't seen a penny." The advertisements did not accuse any particular promotion company of engaging in scams, nor did they identify the company to which Lewis referred.

A news organization then published a story on the Invention Submission Corporation, noting that Lewis had filed a complaint against ISC and how the FTC had investigated the ISC for "misrepresentation in patent marking schemes."

The Invention Submission Corporation then sued the PTO under the Administrative Procedure Act (APA) alleging that the PTO's advertisements exceeded its statutory authority and were done in order to penalize ISC.

Both the district court and 4th Circuit Court of Appeals dismissed ISC's claims, noting that the PTO's ad campaign was not a "final decision" as required for jurisdiction under the APA.

 Now, ISC has petitioned the Supreme Court of the United States for a hearing on the case.  ISC argues that the the PTO's actions constitute a sanction against the company, and is therefore reviewable under the APA.

The government brief in opposition to the petition is available here. The briefs have been distributed for conference scheduled for October 29.

 

Posted by Dennis Crouch | Permalink

Oct 20, 2004

Courts Rely on Internet Articles to Deny Trademark Application

In re DSS Environmental (Fed. Cir. 2004) (unpublished).

The USPTO refused to register DSS's trademark DUALSAND on the grounds that the term is merely descriptive.

Under 15 USC 1052(e)(1), the PTO may refuse to register a mark if the mark, “when used on or in connection with the goods of the applicant,” is “merely descriptive” of the applicant’s goods. 

The Federal Circuit agreed with the PTO, concluding that the PTO's decision was supported by substantial evidence.

Interestingly, the Appellate Panel supported the PTO's reliance on articles from the Internet. 

DSS argues that the articles in the record lack credibility because their source was the Internet. However, the examining attorney was not relying on the articles for their accuracy, but merely to ascertain how the term “dual sand” is used in the context of water wastewater filtration. In making such a determination, the examining attorney may obtain evidence from “any competent source, such as dictionaries, newspapers, or surveys.” . . . The Internet articles in this case, including on-line copies of newspaper articles, fully satisfy that requirement.

Refusal to register mark affirmed.

 

Posted by Dennis Crouch | Permalink

Design patents: Bernhardt v. Collezione Europa

Bernhardt v. Collezione Europa (Fed. Cir. 2004) (04-1024).

Bernhardt sued low cost furniture dealer Collezione for infringement of six design patents. The district court, however, held that several of patents were invalid under 102(b) for prior public use.  Specifically, the court found that Bernhardt's disclosure of the designs at a Pre-Market exhibition rendered the patents invalid.  In addition, the court found that Collezione's products did not infringe the patents.

On appeal, the Federal Circuit vacated and remanded:

I. Public use analysis for a design patent requires substantially similar appearance in the eyes of ordinary user as compared to the claimed designs or their points of novelty.

While the court concluded that each of Bernhardt’s furniture pieces ... were “similar to” the furniture design “shown in” each of Bernhard’s design patents, the analysis does not discuss or explain whether the furniture designs actually displayed at Pre-Market were substantially similar in appearance in the eyes of an ordinary observer to the claimed designs or appropriated the points of novelty of the patented designs. Only after making these determinations could the district court properly assess whether an invalidating public use within the scope of § 102(b) had occurred.

II. Witness testimony is not required to establish infringement of design patent.

The court apparently did not consider the evidence actually introduced—the design patents, their prosecution histories, and the cited prior art—from which Bernhardt’s proposed points of novelty and contentions regarding how Collezione’s accused designs appropriated Bernhardt’s proposed points of novelty might have been discerned. Because the district court incorrectly required Bernhardt to explain its points of novelty through the testimony of a witness, and concluded, based on the absence of such testimony, that Bernhardt failed to prove that Collezione had appropriated the novel ornamental features of the patents-in-suit, we vacate the district court’s judgement of non-infringement, and remand the infringement issue to the district court for further proceedings consistent with this opinion.

Posted by Dennis Crouch | Permalink

Oct 18, 2004

States May Face Patent Liability For Importing Drugs

In a recent paper, Penn State Professor Daniel Cahoy analyzed the importation of inexpensive drugs from Canada and other countries. His research looked at potential liability for patent infringement by various levels of government. Cahoy arrived at several conclusions:

• Both private organizations and municipalities share the same, crushing liability under the Patent Act;
• Despite Eleventh Amendment immunity, state governments face nearly equivalent liability for takings claims based on the Fourteenth Amendment;
• The federal government confronts liability under the Fifth Amendment that broadens its exposure under the recognized just compensation statute; and
• Attempts by Congress to modify the Patent Act to permit importation would likely constitute an unconstitutional taking.

Cahoy, Daniel R., "Patent Fences and Constitutional Fence Posts: Property Barriers to Pharmaceutical Importation" . Fordham Intellectual Property, Media & Entertainment Law Journal, Vol. 15, Winter 2005. http://ssrn.com/abstract=603121

Note: Under U.S. Law, the first sale (AKA "Exhaustion") doctrine does not apply to products sold in a foreign country.

United States patent rights are not exhausted by products of foreign provenance. To invoke the protection of the first sale doctrine, the authorized first sale must have occurred under the United States patent.

Jazz Photo v. ITC, 264 F.3d 1094 (Fed. Cir. 2001), cert. denied, 536 U.S. 950 (2002).

Posted by Dennis Crouch | Permalink

Oct 14, 2004

Eolas, Microsoft and Pellegrini

The recently filed petition in Pellegrini may ultimately decide the damage award in Eolas v. Microsoft.  Both cases discuss the international application of U.S. Patent Law, and the requirements of 35 U.S.C. 271(f)(1).

271(f)(1) provides for liability for causing components of a patented invention to be supplied for assembly abroad:

Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer. 35 U.S.C. 271(f)(1).

At the district court level, Eolas won a $500 million verdict for Microsoft's alleged patent infringement.  A portion of the award fell under 271(f).  In Eolas, no physical component of the patented invention had shipped from the U.S.  However, the District Court ruled that Microsoft's shipment of information on a "golden master" disk created a sufficient nexus with the U.S.  The Eolas case is now on appeal.

Similarly in Pellegrini, no physical components were shipped from the U.S.  However, the evidence indicates that the accused infringer made sales and controlled manufacture of components from the U.S.  Unlike in Microsoft, the Federal Circuit found no infringement because no physical components of the patented invention were shipped from the U.S. 

Now, Pellegrini has asked the Supreme Court to review its case.  In addition to solidifying the meaning of the infringement statute, the outcome may also help determine the utimate damages in Eolas.

UPDATE: Professor Joe Miller reminded me of another related case that is pending appeal: AT&T v. Microsoft, (S.D.N.Y. 2004).  That case involved another "Golden Master" disk shipped by Microsoft.  In AT&T, the court held that object code contained on the disk constituted a component under 271(f) even though the object code on the disk was replicated abroad before being incorporated into the final product.

Posted by Dennis Crouch | Permalink

Oct 13, 2004

Contingent Patent Cases

Link: The American Jobs Creation Act of 2004 is ready for President Bush's signature.   The act may be a boon for patent litigators who work on contingency. 

The IRS has previously forced victorious plaintiffs to pay taxes on the entire award, then taxed the attorneys for their contingent fee.  In essence, a large chunk of the earnings are double taxed.  The Jobs Creation Act of 2004 reportedly eliminates this double taxation -- thus increasing the size of the pot to be split between the plaintiff and its attorneys.

Posted by Dennis Crouch | Permalink

Patent Case: On-Line Technologies v. Perkin-Elmer

On-Line Technologies v. Perkin-Elmer (Fed. Cir. 2004).

On-Line sued Perkin-Elmer for infringement of its patent that provides a method of increasing the light-path in a spectrometer with corrected astigmatism and reduced diffusion. (U.S. Patent No. 5,440,143).  After construing the claims, the district court granted summary judgment of noninfringement. 

On appeal, On-Line argued that the claims were too narrowly construed, and that the allegedly infringing mirrors having a toroidal surface fall within the claim limitation of a substantially spherical surface. Perkins-Elmer disagreed, noting that On-Line specifically omitted toroidal surfaced mirrors from its claims, and thus "that On-Line had dedicated surfaces of that shape to the public."

The Federal Circuit agreed with On-Line that toroidal surfaces are covered by the claims.

We reach that conclusion because the specification makes clear that the claim language referring to spherical surfaces with cylindrical components includes toroidal surfaces. 

The court vacated and remanded this portion of the district court decision, but affirmed the rest.

 

Posted by Dennis Crouch | Permalink

Can Dependant Claims Define Structure of Means-Plus-Function Term?

Ghaly v. Hasbro - Re-mix

Ghaly has asked the Court of Appeals for the Federal Circuit for a rehearing based on perceived errors in its prior ruling on the case.  Rehearings are rarely granted.  However, in this case, Ghaly may have a point.

Ghaly's patent claims an "entry control means" limitation.  A major bone of contention is whether the control means is limited to bi-stable switches (Hasbro's position) or include momentary switches (Ghaly's position).  In its initial decision, the CAFC sided with Hasbro, finding that the disclosure limited the claim to bi-stable switches. 

However, Ghaly raises two interesting points in his petition to rehear: 1) In its opinion, the CAFC defined momentary switches to be "like keys on a keyboard [that] revert to their original status the moment a user stops pressing on them."  2) In the dependent claims, Ghaly disclosed that the "entry control means" could be a "key pad switch."  Ergo, argues Ghaly, a key pad switch is a momentary switch.

Ghaly does not cite any cases directly on point, and thus raises the following legal question:

Should means-plus-function language be interpreted in light of the claims as well as the body of the specification?

Hasbro's counsel, Tony Sitko disagrees with Ghaly's interpretation of the case. He noted that "Hasbro thinks that the Court's opinion speaks for itself, and quite frankly, that the Court got it right."

Posted by Dennis Crouch | Permalink

Oct 12, 2004

Honeywell Enforces LCD Patent

This week, Honeywell sued some of the biggest names in the consumer technology industry for infringement of its patents related to liquid crystal display (LCD) technology. (Patent No. 5,280,371).  The patent claims a backlight diffuser consisting of two sheets of cylindrical lenses between the backlight and the screen. 

Included on the list of defendants are Apple, Casio, Dell, Kodak, Fuji, Fujitsu, Nikon, Nokia, Pentax, Sony, Toshiba, and more. The two largest producers of flat panel monitors, LG Philips and Samsung, have already taken licenses under the patent. 

Posted by Dennis Crouch | Permalink

Oct 11, 2004

Supreme Court: Patent Law Treds Into Political World of Outsourcing

Gerald Pellegrini is an inventor in Worcester, Massachusetts.  For the past few years, he has been engaged in a patent dispute with Analog Devices, headquartered in Norwood, Massachusetts.  Now, the case has reached the United States Supreme Court.

APPEALS COURT USES PATENT LAW TO CREATE UNEVEN PLAYING FIELD IN COMPETITION BETWEEN AMERICAN AND FOREIGN WORKERS

Outsourcing of manufacturing and other jobs continues at an unprecedented pace, resulting in the loss of a great many jobs in the United States. American companies often retain their nerve center in the U.S., but delegate the physical labor to employees and contractors located abroad. Foreign outsourcing allows American companies to reduce their payroll and tax burden, and to avoid the more stringent U.S. environmental requirements. Now, the Court of Appeals for the Federal Circuit (CAFC) has offered an interpretation of the patent statute that provides American companies another incentive to outsource -- avoidance of U.S. patent laws. Under the CAFC's interpretation of the patent act, companies that would ordinarily be guilty of patent infringement can now copy patented products with impunity by simply shifting the manual labor of manufacturing outside the U.S.

Gerald Pellegrini, inventor of a specialized motor drive circuit, has taken steps to challenge the CAFC's opinion as legally wrong and also bad public policy. Last week, Pellegrini filed a petition asking the U.S. Supreme Court to hear an appeal of the Analog Devices case. This patent infringement lawsuit, originally filed by Pellegrini in 2002, was partially dismissed because Analog's accused products were manufactured by subcontractors outside the United States and were never physically present in the United States. Pellegrini is asking the Supreme Court to rule that a company who manufactures and sells components of a patented product from the U.S. cannot avoid liability for infringement simply by using outside foundries to fabricate their products.

The statute at issue is 35 U.S.C. Section 271(f)(1). This statute was enacted twenty years ago to prevent U.S. companies from avoiding patents by supplying components for foreign assembly.

Posted by Dennis Crouch | Permalink

Patent: ITC's Enforcement Authority Upheld

Vastfame Camera v. International Trade Commission, et al. (Fed. Cir. 2004)

In the ITC, Fuji was granted a general exclusion order based in its patented disposable camera technology. Fuji then sought to enforce the order through the ITC against specific violators.

On appeal to the Federal Circuit, one alleged violator, VastFrame, questioned the ITC’s statutory authority to conduct enforcement proceedings against specific companies based on a general exclusion order. In its decision, the Appellate Panel found that there was no explicit statutory authority for enforcement proceedings, but that such authority was implied in Section 1337(b).

VastFrame next argued that Commission violated § 1337 in not allowing VastFame to present any invalidity defense. Based on statutory language, this time the Court agreed with VastFrame.

Because we hold that the Commission erred by not allowing VastFame to present its invalidity defense based on the clear language of § 1337(c), we do not reach the issue of whether VastFame’s due process rights were violated in this case.

Vacated and Remanded

Posted by Dennis Crouch | Permalink

Oct 10, 2004

Supreme Court: Merck v. Integra

Last week, the U.S. Supreme Court took a step toward accepting Merck's petition of writ of certiorari by inviting the Solicitor General to file a brief expressing the views of the U.S. Government.

The appeal questions the limits of the safe harbor statute (35 USC 271(e)(1)) that permits drug manufactures to perform the experiments needed to obtain FDA approval of their drugs without incurring liability for patent infringement, even if their activities infringe other's patent rights.

Some district courts had interpreted the act broadly to protect many types of infringing activities. However, the Federal Circuit, in Integra v. Merck, decided that safe harbor does not apply to early drug development activities. The case is now on appeal to the Supreme Court.

Background: Integra brought this patent infringement suit based on several patents relating to a short tri-peptide segment of fibronectin having the sequence Arg-Gly-Asp. The peptide sequence promotes cell adhesion to substrates in culture and in vivo.

Posted by Dennis Crouch | Permalink

Oct 09, 2004

Fuji Film v. ITC

Fuji Film v. ITC (Fed. Cir. 2004).

After an enforcement proceeding at the ITC, Fuji appealed.

The Appellate Panel made several rulings on claim construction. Additionally, the CAFC found that the Commission did not abuse its discretion in refusing to issue cease and desist orders against foreign respondents with no inventory in the United States and foreign respondents that did not directly import products into the United States.

Finally, Fuji argued that enforcement of the general exclusion order would be ineffective in light of the Customs Service’s new responsibilities in combating terrorism. The Federal Circuit rejected this arguments out of hand.

With respect to the first point, Fuji’s argument is similar to the argument advanced in the Hyundai case, which we rejected as “a thinly veiled and vaguely expressed dissatisfaction with the certification procedure it expects the Customs Service to devise when it implements the Commission’s order.” 899 F.2d at 1210. As we did in Hyundai, we reject Fuji’s suggestion that the Customs Service is incapable of enforcing the Commission’s general exclusion order effectively because of a lack of expertise and other priorities. To the extent that Fuji’s argument is directed at a perceived lack of resources or competence on the part of the Customs Service, we cannot address that problem through a judicial directive that would, in effect, require the Commission to alter its practices based on our unsupported suspicion that the Customs Service is incapable of performing the duties Congress has assigned to it.

Note: This is a companion case to VastFrame v. ITC (Fed. Cir. 2004).

Posted by Dennis Crouch | Permalink

Oct 07, 2004

Disclosure of species can support genus claims

Bilstad v. Wakalopulos (Fed. Cir. 2004) (03-1528).

Both Bilstad and Wakalopulos claim to have invented a device for sterilizing objects using ionizing radiation. Bilstad provoked an interference proceeding to determine which party was deserving of the patent.  The Patent Board (BPAI) rejected Bilstad's claims for failure to meet the written description requirement because Bilstad had broad claims (genus) based on a more narrow disclosure (species).

On appeal, the Court of Appeals for the Federal Circuit (CAFC) vacated-in-part because the Board "failed to apply the appropriate standard in its analysis of whether Bilstad's application included sufficient written description to support the count under 35 U.S.C. § 112."

This court has continued to apply the rule that disclosure of a species may be sufficient written description support for a later claimed genus including that species. . . . If the difference between members of the group is such that the person skilled in the art would not readily discern that other members of the genus would perform similarly to the disclosed members, i.e., if the art is unpredictable, then disclosure of more species is necessary to adequately show possession of the entire genus.

Note: According to USPTO assignment data, the real parties in interest in this case appear to be Baxter International (Bilstad) and USHIO Technologies (Wakalopulos).

Posted by Dennis Crouch | Permalink

Oct 02, 2004

The Combover

Be careful of your hair design.  Frank & Donald Smith of Orlando, Florida own the patent on a method for styling hair to cover bald areas using only the individual's own hair -- AKA, the combover. (U.S. Patent No. 4,022,227). Actually, the patent issued in 1977 and appears to be expired.

Some potential infringers:

The Smiths were awarded the 2004 Ig Nobel Award from Harvard University for their contribution to the engineering field.

Other winners included the authors of a published report "The Effect of Country Music on Suicide" as well as Jillian Clarke, a Chicago high school student who investigated the scientific validity of the Five-Second Rule.

 

Posted by Dennis Crouch | Permalink

Sep 30, 2004

Laboratory Corporation of America v. Chiron

Laboratory Corporation of America v. Chiron (Fed. Cir. 2004) (03-1572).

Chiron developed a method of nucleic acid testing for Hepatitis-C virus in the human blood.  (U.S. Patent 5,712,088).  LabCorp supplies nucleic acid testing products for testing the presence and quantity of Hep-C virus and performs tests at its North Carolina facility. 

Chiron sued LabCorp in California for infringement only hours after LabCorp filed a declaratory judgment suit against Chiron in Delaware.  During the course of litigation, the Delaware District Court granted LabCorp's motion to enjoin Chiron from prosecuting parallel litigation that was co-pending in the Northern District of California.  Chiron appealed the decision. At issue was whether to apply Federal Circuit or Third Circuit law:

In this case, the decision whether to follow Federal Circuit or Third Circuit law is critical: as we have previously observed, the Third Circuit has held that injunctions against litigation in other forums are not appealable, while under Federal Circuit law such injunctions are appealable under 28 U.S.C. § 1292(a)(1). Thus, we must decide which law applies.

Citing the importance of national uniformity in patent cases, the appellate panel held that injunctions arbitrating between co-pending patent declaratory judgment and infringement cases in different district courts are reviewed under the law of the Federal Circuit.

On review of the actual order to enjoin, the panel determined that the district court had not abused its discretion in enjoining the parallel California action. 

Affirmed.

Posted by Dennis Crouch | Permalink

Payless Shoesource v. Genfoot

Payless Shoesource v. Genfoot (D. Kans. 2004) (03-4227-JAR).

After receiving a threatening letter from Genfoot, Payless filed for a declaratory judgment in Kansas, requesting a judgment of patent invalidity, unenforceability, and noninfringement of Genfoot's patent on a boot. Genfoot, a Canadian company, moved to dismiss based on a lack of personal jurisdiction.

Holding:

Sending an infringement letter, without more, is insufficient to satisfy the requirements of due process when exercising jurisdiction over an out-of-state patentee.

A web site may form the basis of personal jurisdiction. Genfoot's website, however, does not allow for on-line sales. "Although a customer is interacting with the web sites, this interaction alone likely is not sufficient for minimum contacts without a more substantial exchange of commercial information."

Genfoot sells to a national distributor. However, "doing business with a company that does business in the state is not the same as doing business in the state."

The combination of all these elements may be sufficient to create minimum contacts with the state. ... Therefore, Genfoot is subject to specific personal jurisdiction in Kansas.

Posted by Dennis Crouch | Permalink

Sep 29, 2004

Constitutionality of PTO Fee Diversion

Figueroa v. United States.

Figueroa is a class action suit filed on behalf of inventors in the Court of Federal Claims. The cases challenges the constitutionality of congressional diversion of USPTO fee revenue to other non-IP government programs.

The suit alleges three grounds of unconstitutionality: 1) an unconstitutional violation of the Patent Clause that directs congress "to promote the progress of science and the useful arts;" (2) an unconstitutional direct tax on private property, and (3) an unconstitutional taking of private property. However, the Court has trimmed the suit to solely examine whether the Patent Clause restricts the fee diversion.

Recently, the AIPLA filed an Amicus brief in the case.

While taking no position on the request for relief, AIPLA pointed out that fee diversion increases the burdens on examiners and decreases patent quality, thereby adversely impacting the Office’s ability to carry out the Constitutional command of promoting the progress of the useful arts.

Heath Hoglund, a patent attorney in Puerto Rico appears to be heading the charge for the class.

Posted by Dennis Crouch | Permalink

Sep 27, 2004

Experimental Use must be Non-Educational

Madey v. Duke University (M.D.N.C. Sept 20, 2004) (97CV01170).

Before arriving at Duke as a professor, Dr. Madey obtained several patents for microwave electric guns for use in free electron studies. (E.g., Patent 4,641,103). After Duke & Madey had a falling out, and the professor left the university.

Dr. Madley now asserts in a patent infringement suit that Duke continued to use his patented technology without license.

Duke requested summary judgment based on the experimental use defense. Duke contended that its use of the plaintiff's patents was done "for the sole purpose of gratifying a philosophical taste, or curiosity, or for mere amusement," and thus, that the use was experimental.

The court held that 1) the burden of proof for experimental use lies with the accused infringer, in this case Duke; and 2) the defense of experimental use cannot be applied to this case simply because the invention is used in a lab. "Duke [failed to establish] that its alleged use of Plaintiff's patented inventions was not in keeping with its legitimate business as an educational institution but was instead solely for amusement, . . ."

Posted by Dennis Crouch | Permalink

Sep 23, 2004

Phillips v. AWH: The Amicus Briefs

Phillips v. AWH Corp. (Fed. Cir. 2004) (en banc).

Earlier this week briefs were due in the en banc appeal of Phillips v. AWH.  The Federal Circuit is rehearing this case to resolve issues concerning the construction of patent claims and the use of dictionaries. 

Here is a rundown of some of the Amicus Briefs:

1. United States Patent and Trademark Office (USPTO): The Patent Office took the position that dictionaries should not be a primary reference for claim construction, in part because they are not used by examiners during prosecution. Update: the Government brief is actually filed jointly by the PTO, DOJ, and FTC. More info here and here.

2. Intellectual Property Owners (IPO): The IPO brief, argues that the primary evidence of claim meaning should be found in the patent specification and prosecution history.  If a court must resort to extrinsic evidence to determine claim meaning, there should be no predetrmined hierarchy of importance.  The Court should only consider claim construction evidence in the record on appeal. The IPO brief was written by Paul Berghoff and Josh Rich of MBHB.

3. Electronic Frontier Foundation (EFF): Judges should invalidate and Patent Office Examiners should reject ambiguous claims.  Claims should be given their broadest possible construction during prosecustion and narrowest reasonable meaning thereafter. More info here. Professor Joshua Sarnoff is the Counsel of Record on the EFF brief.

4. American Bar Association (ABA): Neither the specification nor dictionary should have primacy. Invalidity should play no role in claim construction, as that approach is contrary to the public notice function. The Appellate Court should defer to findings of fact made during claim construction.

5. American Intellectual Property Law Associatin (AIPLA): The fundamental standard that should govern claim construction is that a claim term must be construed from the perspective of a person of ordinary skill in the relevant art at the time the patent issued seeking to understand the term's meaning from a study of the entire intrinsic record.

6. Intel, IBM, Google, Micron, and Microsoft: Where those construing patent claims focus on dictionary meanings of claim terms without an appropriate grounding in the specification and prosecution history, there is a danger the interpretation of patent claims will differ markedly from the true scope of the invention they seek to define. Indeed, there are so many different dictionary definitions for any given word that it is impossible to predict with any confidence what meaning a court will choose. The Intel brief was written by Stanford professor Mark Lemley.

7. Federal Circuit Bar Association (FCBA): Dictionaries should not be the primary focus of claim construction. Claim construction may require findings of fact, which should be reviewed for clear error.

8. International Trade Commission Trial Lawyers Association (ITCTLA): The specification and prosecution history should control. When dictionaries are used, technical dictionaries should have a rebuttable preference over general dictionaries. Claim language should not be narrowly construed for the sole purpose of avoiding invalidity. The claim interpretation should not be limited to only the embodiment described in the specification. Expert testimony should be allowed and evaluated as would any other piece of evidence. Deference to the trial court's claim construction may be appropriate in some cases.

9. Biotechnology Industry Organization (BIO): Specification first.  Dictionaries second, when specification does not establish meaning of claim terms. Claims should never be narrowly construed for the sole purpose of avoiding invalidity.

10. Bar Association of District of Columbia (BADC) Patent Trademark Copyright (PTC) Section: The specification always provides context for the claims. The court should not determine the question of deference because it would be an advisory opinion.

11. Professors Wagner & Miller: The professors argue that the patent document should be the primary and preferred source of claim meaning -- as long as it is clear, specific, and objective. Where the term is not clearly defined in the patent document, there should be a heavy presumption in favor of the ordinary meaning of the term. Dictionaries are not a panacea, but they offer the best opportunity to provide a term's ordinary meaning with clarity, certainty, and predictability.

12. Public Patent Foundation (PUBPAT): Dan Ravicher of PUBPAT argued that "claim construction should never be impacted by considerations of validity." Consistent with Markman, subsidiary factual determinations by the trial court durint claim construction should be reviewed for clear error.

13. Intellectual Property Law Association of Chicago (IPLAC): Courts may look to the plain meaning of claim terms but asserts that dictionaries should in general be subordinate to the patent specification and other intrinsic evidence when determining what is meant objectively by challenged claim terms. Dictionaries may be considered, but the guiding light must be what the hypothetical ordinarily skilled artisan would have understood by the claim terms – not in a vacuum, and not armed with only a technical or general purpose dictionary, but also with the full panoply of intrinsic evidence. Courts may receive expert witness testimony on this determination. Edward Manzo wrote the brief for IPLAC, and was given assistance by Brad Lyerla, Dean Monco, Pat Burns and Tim Vezeau.

14. Association of Corporate Counsel: Public notice is best served by first looking at claims, specification and prosecution history. Dictionaries should not be the primay source for claim construction. Because the guiding inquiry is the meaning of terms to those of ordinary skill in the relevant art, relevant technical dictionaries should usually be consulted before general dictionaries.

15. Infineon: The public notice function of patent claims is best served by looking first and foremost to the intrinsic specification, not an extrinsic dictionary definition, to interpret claim terms.

16. Boston Patent Law Association: Dictionaries should not be the primary source of claim construction because they do not stay current, are not necessarily authoritative, and because meaning is not always found in books. Validity and claim construction should be kept separate.

17. Connecticut Intellectual Property Law Association: Inflexible rules of construction are ineffective in interpreting the widely varying universe of language found in patent claims.

18. Medrad, Inc: Claim construction should be based upon the intrinsic evidence (spec, drawings, cited prior art, and prosecution history).

19. NYC Association of the Bar: Dictionary definitions should not provide the primary source of meaning or a separate restriction on claim coverage. Validity should be considered during claim construction. Expert testimony can provide important information. Deference to the trial court's claim construction findings is blocked by procedural and practical obstacles.

20. New York IP Law Association, et. al.:

21. Norvatis:

22. Oregon Patent Law Association:

23. Parus Holdings:

24. Pharmaceutical Patent Attorneys:

25. San Diego IP Law Association:

26. Sughrue Mion: Claims should be interpreted as of the time of filing or earlier. The patent document provides the best notice of the claim's meaning. Deference should be accorded to a trial court's factual findings underlying claim construction.

27. VISA USA and Mentat:

28 Wisconsin Alumni Research Foundation (WARF), UVA, Yale, etc.:

Party Briefs:

1. Edward H. Phillips

2. AWH Corporation

3. Phillips reply brief

More Links:
First Appellate Decision.
Discussion of the First Appellate Decision.
Decision to Rehear.
Discussion of the Decision to Rehear: Part I, Part II, Part III, Part IV.

AWH counsel Mark Fischer has put together a set of the briefs, including party briefs here.

Professor Joe Miller's paper on dictionary usage.

Phil Mann has more information at his IP Litigation Blog.

IP Law Association of Chicago has provided this summary of the briefs in table format.

ASIDE:

Interestingly, Mr. AWH Phillips was a famous economist who discovered a consistent inverse relationship between the rate of wage inflation the rate of unemployment in the UK. Link.

Posted by Dennis Crouch | Permalink | Comments (1) | TrackBack

Sep 22, 2004

Kangaroo Court

This trademark opinion is so good, I wanted to quote the entire thing:

Klein-Becker v. Bodyworx.com (Western District of Texas, July 21, 2004)

BE IT REMEMBERED on the 21st day of July 2004 and the Court took time to make its daily review of the above-captioned case, and thereafter, enters the following:

When the undersigned accepted the appointment from the President of the United States of the position now held, he was ready to face the daily practice of law in federal courts with presumably competent lawyers. No one warned the undersigned that in many instances his responsibility would be the same as a person who supervised kindergarten. Frankly, the undersigned would guess the lawyers in this case did not attend kindergarten as they never learned how to get along well with others. Notwithstanding the history of filings and antagonistic motions full of personal insults and requiring multiple discovery hearings, earning the disgust of this Court, the lawyers continue ad infinitum. On July 20, 2004, the Court’s schedule was interrupted by an emergency motion so the parties’ deposition, which began on July 20, would and could proceed until 6:30 in the evening. No intelligent discussion of the issue was accomplished prior to the filing and service of the motion, even though the lawyers were in the same room. Over a telephone conference the lawyers, of course, had inconsistent statements as to the support of their positions. On July 20, 2004, the Court entered an order allowing the plaintiffs/counter-defendants until July 23, 2004 (two days from today) to answer a counterclaim. Yet, on July 21, 2004, Bodyworx.com, Inc.’s lawyers filed a motion for reconsideration of that Court order arguing the pleadings should have been filed by July 19, 2004.

The Court simply wants to scream to these lawyers, “Get a life” or “Do you have any other cases?” or “When is the last time you registered for anger management classes?”

Neither the world’s problems nor this case will be determined by an answer to a counterclaim which is four days late, even with the approval of the presiding judge.

If the lawyers in this case do not change, immediately, their manner of practice and start conducting themselves as competent to practice in the federal court, the court will contemplate and may enter an order requiring the parties to obtain new counsel. In the event it is not clear from the above discussion, the Motion for Reconsideration is DENIED. SIGNED this 21st day of July 2004.

In more refreshing news, Phil Mann reports that "Sanity Returns to Court of Appeals." (Federal Circuit).

I can’t believe it. Maybe I’m wrong (I’ll re-read the case Tuesday). But it sure seems the Court of Appeals has finally let common sense influence one of its decisions.

Posted by Dennis Crouch | Permalink

Sep 20, 2004

Yahoo & Inktomi chip away at Teknowledge patent

District court has no power to redraft claim language to change its ordinary meaning.

Teknowledge v. Akamai (N.D. Cal. 2004) (C 02-05741 SI).

In the Summer of 2002, Teknowledge sued Akami, Inktomi, Yahoo, Microsoft, and Netscape for infringement of its patent involving "automatic retrieval of changed files by a network software agent". (US6029175). As part of the litigation, Yahoo and Inktomi filed for summary judgment of invalidity of some claims.

In order to avoid summary judgment of invalidity for claim 29, Teknowledge argued that a typographical error existed in the patent, and that the court should redraft the claim based on the intended meaning. Judge Illston disagreed, citing the "clear line of Federal Circuit authority" that bars district courts from re-drafting claims to change their ordinary meaning, "even if the ordinary meaning produces a nonsensical result. (citing Chef America). Because the ordinary meaning produced a nonsensical result, the Court found the claim invalid.

Summary Judgment Granted to Yahoo & Inktomi.

Citing the ongoing litigation, Yahoo's attorney had no comment.

Posted by Dennis Crouch | Permalink

Sep 19, 2004

Patent's transition language limits its use as an anticipatory reference

In re Morrison (BPAI 2004) (unpublished opinion).

Acarbose is an oral alpha-glucosidase inhibitor approved for use in the management of non-insulin-dependent diabetes mellitus (NIDDM). In 2001, James Morrison applied for a patent for using acarbose in a sustained release matrix as a weight loss stimulant. The PTO examiner assigned to the case rejected the claims as anticipated by prior art.

One reference cited by the examiner suggested the use of acarbose as a weight loss stimulant to be used alongside a lipase inhibitor. However, the Board overruled the Examiner's rejection because the reference included the language "consisting essentially of" when describing the acarbose-lipase-inhibitor combo.

The basic and novel characteristics of the claimed composition do not include inhibition of lipase enzymes. Thus, the addition of a lipase inhibitor would materially affect the basic and novel characteristics of the claimed composition. The claims do not read on the compositions disclosed by Bremer, which all contain a lipase inhibitor. The rejection under 35 U.S.C. § 102(b) is reversed.

REVERSED, 37 CFR § 1.196(b)

Posted by Dennis Crouch | Permalink

Sep 14, 2004

Echostar wins appeal: DISH Network found to not infringe patent

Irdeto Access v. Echostar (Fed. Cir. 2004).

Irdeto's patent is directed to a system for controlling the broadcast of digital information signals by using three types of complementary encryption and decryption keys -- “service keys,” “group keys,” and “box keys.”  (U.S. Patent No. 4,531,020).  Irdeto sued Echostar, arguing that Echostar's DISH Network infringed the patent.  On summary judgment, the district court granted summary judgment to Echostar, finding that Echostar's product did not infringe.  The Appeal revolved around the definition of the term "group."

Irdeto, in effect, argues is that even after telling the PTO and the public that given the absence of ordinary meaning in the art for the term “group,” the specification sets forth the full intended scope of that term, a patentee can nonetheless later lay claim to a broader, general-usage dictionary meaning of “group” absent explicit narrowing statements in the specification.  This cannot be.  ... [W]hile the specification does not contain any statements of explicit disavowal or words of manifest exclusion, it repeatedly, consistently, and exclusively uses “group” to denote fewer than all subscribers, manifesting the patentee’s clear intent to so limit the term.  The specification also contains no affirmative indication that group can consist of all subscribers within the system.  A reasonable competitor reading the patent could only understand “group” to refer to a subset of all subscribers.  The claims must be limited accordingly.

Summary Judgment of Noninfringement Affirmed.

Posted by Dennis Crouch | Permalink

Patent Case: Landmark Decision Strengthens Attorney-Client Privilege

By Dennis Crouch

In a landmark decision, a panel of eleven Federal Circuit judges has overruled their prior precedent, relieving accused patent infringers of the feared "Quantum Dilemma."

Willful patent infringement brings with it the potential for treble damages (3x), usually resulting in multi-million dollar awards. (35 USC § 284). Prior cases have held that an important factor for determining willfulness is whether the accused infringer obtained an opinion of counsel that presents a strong case for invalidation or noninfringement.

During litigation, presentation of the exculpatory opinion as evidence triggers broad waiver of attorney-client privilege. Under prior precedent, failing to present the opinion conversely leads the court to an inference that either the opinion was not exculpatory or that there was no opinion of counsel.

The modified Hobson's choice is known as the Quantum Dilemma, based on the case of Quantum v. Tandon.

In their en banc decision written by Judge Newman, the appellate court held that no adverse inference should flow from a party's refusal to present an exculpatory opinion of counsel.

We now hold that no adverse inference that an opinion of counsel was or would have been unfavorable flows from an alleged infringer's failure to obtain or produce an exculpatory opinion of counsel. Precedent to the contrary is overruled.

The Case: KNORR-BREMSE v. DANA CORP. (Fed. Cir. 2004) (01-1357) (en banc).

Knorr-Bremse is a German company, but is the owner of a U.S. patent on Disk Brake technology. (U.S. Patent No. 5,927,445). Dana Corporation and other defendants were found liable for infringement. And, based on an inference of an unfavorable counsel, the defendants were found liable for willful infringement. Although no actual damages were awarded, because of the finding of willful infringement the court awarded partial attorney fees under 35 U.S.C. § 285.

During litigation, the defendants told the court that they had consulted European and United States counsel concerning Knorr-Bremse's patents, but declined to produce any legal opinion or to disclose the advice received, asserting the attorney-client privilege. The district court found that "It is reasonable to conclude that such opinions were unfavorable."

The Decision:

In its decision, the Court answered four questions revolving around willfulness:

In the first question, the Court based its response on the strong historical significance of attorney-client and work-product privileges.

1. When the attorney-client privilege and/or work-product privilege is invoked by a defendant in an infringement suit, is it appropriate for the trier of fact to draw an adverse inference with respect to willful infringement?

The answer is "no." Although the duty to respect the law is undiminished, no adverse inference shall arise from invocation of the attorney-client and/or work product privilege.

In the second question, the Court found that there is no legal duty of a potential infringer to consult with counsel.

2. When the defendant had not obtained legal advice, is it appropriate to draw an adverse inference with respect to willful infringement?

The answer, again, is "no."

Question three revolved around the case at hand.

3. If the court concludes that the law should be changed, and the adverse inference withdrawn as applied to this case, what are the consequences for this case?

As an answer, the Court vacated the willfulness finding and remanded for a redetermination of willfulness in the absence of the inference of a nonexculpatory opinion.

The final question, number four, offered the Court the opportunity to create a clear rule that mounting a substantial defense to infringement should defeat a willfulness finding.

4. Should the existence of a substantial defense to infringement be sufficient to defeat liability for willful infringement even if no legal advice has been secured?

The answer is "no."

The Court concluded that willfulness involves a "totality of the circumstances" and should not be limited to a per se rule.

The Dissent:

Dissenting in part, Judge Dyk argued that enhanced damages for willfulness are punitive damages. Punitive damages are awarded to "punish reprehensible behavior." As such, there is a "substantial question as to whether the due care requirement is consistent with the Supreme Court cases holding that punitive damages can only be awarded in situations where the conduct is reprehensible. ... I would recognize that the due care requirement is a relic of the past and eliminate it as a factor in the willfulness and enhancement analysis."

Note: Paul Berghoff and Joshua Rich of McDonnell Boehnen Hulbert & Berghoff took part in an amicus curiae brief submitted by the Intellectual Property Owners Association.

According to Dan Boehnen, also of McDonnell Boehnen, "clients often spend thousands of dollars to obtain window-dressing opinions that are designed solely to defend against a charge of willful infringement. Also, clients sometimes feel compelled to have different law firms handle opinion work versus litigation work. All that artificial conduct is likely to be swept away by the Court's recent decision."

UPDATE: Nipper has more details.

Posted by Dennis Crouch | Permalink

Sep 13, 2004

Federal Circuit: Injunction to "not infringe the patent" is overly broad.

International Rectifier (IR) v. IXYS (Fed. Cir. 2004) (04-1014).

On the day that its patent issued, IR filed a patent infringement suit against IXYS.  IR's patent relates to semiconductor device (MOSFET) packages having a higher current capacity without increased size. (U.S. Patent No. 6,476,481).  The issue for appeal is "whether the [permanent] injunction granted the patentee is overly broad, and, if so, what is the proper remedy."

The Federal Circuit rejected the injunction because it was overly broad under Rule 65(d) of the Federal Rules of Civil Procedure. 

In the patent infringement context, this court has rejected as overly broad a permanent injunction that simply prohibits future infringement of a patent. ... [T]he trial court's injunction in this case does not meet the specificity requirements of Rule 65(d).  The injunctive language set forth in the trial court's judgment prohibits infringement by "any device covered by one or more of Claims 1 through 5" of the '481 patent. 

Thus, the Appellate Panel vacated the injunction entered by the trial court and remanded the case with instructions to issue an injunction that meets the specificity requirements of Rule 65(d).

Comment: One interesting dichotomy is that the International Trade Commission (ITC) commonly issues broad injunctions or import restrictions that prohibit unlicensed entry of products that infringe certain patents.  For example, in the recent plastic bag case, the ITC issued a general exclusion order prohibiting the unlicensed entry of plastic grocery bags that infringe patent 5,188,235.

 

Posted by Dennis Crouch | Permalink

Patent Law: Disclosure-Dedication Rule Takes Shape

Toro v. White Consolidated (WCI) (Fed. Cir. 2004).

The Toro Company sued White for infringement of its patent on a leaf blower. (U.S. Patent No. 4,694,528).  The Minnesota district court granted summary judgment of non-infringement under the doctrine of equivalents -- finding that White's two-piece cover/ring was dedicated to the public in Toro's patent because it was disclosed, but not claimed. (Citing Johnson & Johnson v. R.E. Service). The Federal Circuit (LINN) agreed, finding that the disclosure of unclaimed subject matter "triggers the disclosure-dedication rule."

Because J&J had been decided after claim construction in this case, Toro also argued that the issues should be re-examined in light of the new law.  The Appellate Panel Disagreed.

While Toro argues that Johnson & Johnston represents a change of law, its argument is misplaced.  Johnson & Johnston did not alter our precedent as to claim construction, the issue at the crux of this case.... The doctrine of the law of the case is intended to prevent just the kind of speculation and second-guessing invited by the appellant here, in the broader interests of certainty, finality, and legal efficiency. The law is well-settled; decisions once made are not to be disregarded except for exceptional circumstances. Such circumstances are not evident here.

 

 

Posted by Dennis Crouch | Permalink

Football Invention Tests Quarterback Timing

In re Oister (BPAI 2004).

On appeal to the Board of Patent Appeals and Interferences, the patent applicants argued that their "ball having integrated timers for measuring or counting at least one time period" was novel over the asserted prior art. The Board agreed that the device was patentable because the prior art did not use a predetermined countdown time period.

Sample Claim from the Patent Application:

21. An apparatus comprising:

a ball having a surface and at least one internal cavity;
at least one timer for measuring at least one predetermined time period; and
the timer integrated with the ball.

According to USPTO records, the patent application (10/014,297) is assigned to the Classic Sports Company of Denver.

Posted by Dennis Crouch | Permalink

Sep 09, 2004

Out of Left Field: MLB Sued for Patent Infringement

Major League Baseball (MLB) is the subject of a new patent infringement lawsuit.  A Texas based patent holding company has sued MLB Advanced Media for infringement of its patents covering "computer simulation" of live events, such as baseball games. (e.g., Patent No. 6,204,862).  The case, filed in Austin, revolves around MLB's Internet-based products.

The following specific MLBAM products and services are implicated in the lawsuit: (1) Gameday, (2) Condensed Games, (3) Searchable Video (formerly called Custom Cuts), (4) Highlight Reels and (5) Fantasy Player Tracker. (DDB Press Release).

The four asserted patents are members of a single "patent family" and date back to a patent application filed in 1990.  David Barstow, Plaintiff DDB Technologies' head honcho, is listed as an inventor.

Last year CBS's SportsLine settled with DDB -- licensing its patent portfolio on a non-exclusive basis. (Link).

Posted by Dennis Crouch | Permalink

Tables Turned: RIAA Accused of Patent Infringement

Invent Blog: An online music distributor has reportedly sued the Recording Industry Association of America (RIAA) for patent infringement.  The asserted patent claims a method for generating a unique identifier based on content of a datafile, then later using the identifier to track files containing identical content.  (U.S. Patent No. 5,978,791).  The RIAA is accused of using the patented technology to track down peer-to-peer (P2P) copyright violators.

In a suit filed with the Los Angeles District Court, Altnet maintains that the RIAA, Loudeye subsidiary Overpeer and a fellow anti-piracy operation, MediaDefender, have all violated a patent it holds covering the identification of files on a P2P network using digital fingerprint technology. (The Register).

Altnet is a partner with Kazaa, and according to cNet news, "has been trying for several years to persuade record labels and music studios to allow Altnet to sell authorized versions of their products through the Kazaa file-swapping network." 

The lawsuit was filed in the Southern District of California.

 

Posted by Dennis Crouch | Permalink

Sep 07, 2004

Federal Circuit: National Instruments v. MathWorks

National Instruments v. MathWorks (Fed. Cir. 2004) (03-1540) (unpublished opinion).

National Instruments (NI) sued MathWorks overs for infringement of its patented method of creating data flow diagrams.  The jury sided with NI and the district court denied Mathworks' subsequent motion for JMOL.

On appeal, MathWorks raised several issues and argued that the permanent injunction issued by the district court went impermissibly beyond the jury's findings.  Specifically, MathWorks argued that its Simulink software had many non-infringing use and that a product based injunction was unduly broad.  However, the Appellate Panel, reviewing for an abuse of discretion, affirmed -- holding that the trial court was sufficiently cognizant of MathWorks arguments in its decision.

MathWorks VP Richard Rovner outlined their position going forward:

First, The MathWorks will abide by the decision of the court and will make modifications to the Simulink product.

Second, the decision affirms that customers can continue to use previously purchased Simulink products and that The MathWorks can continue to provide technical support for these products.

Third, The MathWorks remains fully committed to the Simulink product family and, consistent with the court’s decision, will continue to support and enhance it.

National Instruments Press Release
MathWorks Press Release

Posted by Dennis Crouch | Permalink

Monsanto wins patent infringement appeal over Tennessee farmer

 Monsanto v. Ralph (Fed. Cir. 2004) (03-1243).

Mr. Ralph appealed from a Missouri court judgment imposing sanctions for discovery abuses, violation of court orders, repeated attempts to conceal misconduct and a three million dollar damage award for patent infringement and an alternative award of liquidated damages for breach of contract.

This case falls in line with the recent McFarling opinion involving Monsanto's Roundup-Ready seeds.  Mr. Ralph owns a Tennessee farm.  He purchased Roundup-Ready seeds and then reportedly saved seeds from the F1 generation -- a violation of the patent and the licensing agreement.  During discover, Ralph burned some seed stockpiles -- apparently to avoid discovery.

The Federal Circuit agreed with Monsanto that the district court properly applied sanctions for discovery abuses and properly calculated a reasonable royalty. However, the Appellate Panel did find that Monsanto's "one-size-fits-all" 120 multiplier for breach of contract failed to distinguish between various modes of breach -- and thus was not enforceable.

Conclusion

Although we have determined that the contract-based damages are excessive in light of our recent decision in McFarling, the trial court did not abuse its discretion in its choice of sanction or its denial of Ralph's post-judgment motion, and Ralph has not shown that the jury award for patent infringement is "grossly excessive or monstrous," clearly not supported by the evidence, or based only on speculation or guesswork.  Accordingly, the decision of the district court is

Posted by Dennis Crouch | Permalink

Sep 05, 2004

CAFC refuses to examine Request for Comments (RFCs) when defining ordinary meaning of claim terms

Many Internet standards are initially developed in papers known as Requests for Comments (RFCs). A purpose of an RFC is to collect propose a common language for facilitating development and to collect commentary. Often, however, the RFCs become the authoratitive document describing a particular function. For example, RFC-1738 was created by Berners-Lee in 1994 and is thought of as an authoritative, unbiased source relating to the meaning of the term "URL." The Federal Circuit, however, has refused to allow RFCs to take an authoritative position in claim construction. ACTV v. Disney, 346 F.3d 1082 (Fed. Cir. 2003). In ACTV, the Appellate Court differentiated RFC documents that attempt to shape meaning of terms from dictionaries that reflect established usage.

Posted by Dennis Crouch | Permalink

Sep 03, 2004

Juicy Whips up on Orange Bang: CAFC Affirms Entire Market Value Rule

Juicy Whip v. Orange Bang (Fed Cir. 2004)

 

by Joseph Herndon

 

This is the latest appeal in the lengthy litigation between Juicy Whip and Orange Bang.  (U.S. Patent No. 5,575,405). On remand to determine damages, the district court rejected Juicy Whip’s argument that it would have sold more syrup “but for” Orange Bang’s infringement.  Juicy Whip appealed. 

 

Juicy Whip claimed that there exists a functional relationship between its patented dispenser and the unpatented syrup, a link adequate to justify recovery of lost profits.  The CAFC agreed and vacated the jury’s award and remanded this case back to the district court for a third time to allow Juicy Whip to prove lost profits on its syrup sales.

 

The CAFC followed the “functional unit” test set forth in Rite-Hite, e.g., that the entire market value rule is a principle of patent damages that defines a patentee’s ability to recover lost profits on unpatented components typically sold with a patented item, if both constitute a functional unit. 

 

The CAFC found that Juicy Whip’s dispenser and the syrup were analogous “to parts of a single assembly … as the syrup functions together with the dispenser to produce the visual appearance that is central to Juicy Whip’s ’405 patent.”  The Court explained that “a functional relationship between a patented device and an unpatented material used with it is not precluded [from profit determination] by the fact that the device can be used with other materials or that the unpatented material can be used with other devices.” 

Note: Joseph Herndon is a law clerk and at the intellectual property firm McDonnell Boehnen Hulbert & Berghoff and is a registered patent agent.  Joe has a stellar background in electrical engineering and plans to graduate from law school in 2005. [email protected].

Posted by Dennis Crouch | Permalink

Means-Plus-Function Limitation Rarely Found When Claim Lacks "Means" Language

Lighting World v. Birchwood Lighting (Fed. Cir. 2004).  

In its complaint, Lighting World asserted that Birchwood's fluorescent lamp fixtures infringed Lighting World's patents. At the close of Lighting World's case-in-chief, the court granted Birchwood's motion for JMOL on the ground that Lighting World had not shown equivalence under the doctrine of equivalents.

Lighting World appealed the District Court's claim construction determination that the term "connector assembly" was a means-plus-function limitation.  The unanimous Appellate Panel vacated, finding that Birchwood did not demonstrate that section 112 ¶ 6 should apply.

[W]e have seldom held that a limitation not using the term “means” must be considered to be in means-plus-function form.  In fact, we have identified only one published opinion since Greenberg (Fed. Cir. 1996) in which we have done so, and that case provides a useful illustration of how unusual the circumstances must be to overcome the presumption that a limitation lacking the word “means” is not in means-plus-function form. 

 

 

Posted by Dennis Crouch | Permalink

Sep 02, 2004

Patent Infringement: Recognition of a problem does not render the solution obvious

Cardiac Pacemakers (CPI) v. St. Jude Medical (Fed. Cir. 2004).

CPI (Guidant) controls several patents relating to implantable cardiac defibrillators (ICDs) that are permanently installed under the skin, and that determine abnormal cardiac activity and treat that activity by delivering electrical shocks to the heart muscle in appropriate strengths. CPI charged St. Jude with infringement of two of these patents.

A jury found both patents valid and enforceable, but only one infringed.  After trial, the district court granted St. Jude's motions for JMOL -- holding both patents invalid and not infringed. The court also granted a new trial (in the event of reversal) and awarded sanctions for witness misconduct. CPI appealed the judgment of invalidity and non-infringement.

The Appellate Panel agreed with CPI and reversed, finding that the district court improperly granted JMOL. With respect to obviousness, the Federal Circuit found a nonobvious difference between the prior art's recognition of a problem and the patented solution.

We think that the district court, in granting JMOL, applied an incorrect standard to the ultimate question. Recognition of the problem of treating complex heart arrhythmias does not render obvious the eventual solution. Recognition of a need does not render obvious the achievement that meets that need. There is an important distinction between the general motivation to cure an uncured disease (for example, the disease of multiple forms of heart irregularity), and the motivation to create a particular cure.

The lower court had also invalidated the patent based on a failure to state a best mode for supplying batteries. However, the Appellate panel found that there was "evidence before the jury that persons knowledgeable in the field of the invention would know the sources of batteries for pacemakers and related devices. There was no evidence of concealment, and the jury had evidence that the Honeywell battery was published in a publication for battery specialists. There was substantial evidence whereby a reasonable jury could have found that the best mode requirement had not been violated. The grant of JMOL on this issue is reversed, and the jury verdict is reinstated."

The Appellate Panel continued: "The jury verdicts on the issues of obviousness and best mode were not against the manifest weight of the evidence." Thus, no new trial may be held on the issues of obviousness or best mode. However, a new trial was warranted with respect to infringement because the district court erred in its claim construction.

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

Update:
Peter Zura at the 271 Patent Blog has more information on the case.
Reuters story.

Posted by Dennis Crouch | Permalink

Aug 31, 2004

Xechem v. University of Texas

Xechem v. University of Texas (Fed. Cir. 2004) (03-1406).

Xechem brought several claims against the University of Texas that were dismissed after the University asserted Eleventh Amendment and state immunity from suit. The issue on appeal is whether the University is subject to suit in federal court to obtain correction of inventorship in the patents flowing from a collaboration between Xechem and the University. (US-5877205-A). The Federal Circuit affirmed the lower court's dismissal based on Supreme Court precedent.

Comment: In this case, the court (Newman, J.) seemed to almost go out of its way to emphasize the strong points of Xechem's argument -- giving an indication that it would, but for Supreme Court precedent, refuse to grant immunity to the university.  I would predict that this case will be granted a Writ of Certiorari.

-- Dennis Crouch

Posted by Dennis Crouch | Permalink

Federal Circuit: DMCA does not create a new property right for copyright owners

Chamberlain Group v. Skylink Technologies (Fed. Cir. 2004).

In a well reasoned opinion, the Federal Circuit (GAJARSA) affirmed a district court's dismissal of a suit arising under anti-trafficking provisions of the Digital Millennium Copyright Act (DMCA).

The DMCA does not create a new property right for copyright owners.  Nor, for that matter, does it divest the public of the property rights that the Copyright Act has long granted to the public.  The anticircumvention and anti-trafficking provisions of the DMCA create new grounds of liability.  A copyright owner seeking to impose liability on an accused circumventor must demonstrate a reasonable relationship between the circumvention at issue and a use relating to a property right for which the Copyright Act permits the copyright owner to withhold authorization-as well as notice that authorization was withheld.  A copyright owner seeking to impose liability on an accused trafficker must demonstrate that the trafficker's device enables either copyright infringement or a prohibited circumvention.  Here, the District Court correctly ruled that Chamberlain pled no connection between unauthorized use of its copyrighted software and Skylink's accused transmitter.  This connection is critical to sustaining a cause of action under the DMCA.  We therefore affirm the District Court's summary judgment in favor of Skylink.

This case involved electronic garage door technology with a "rolling code" to encrypt signals transmitted signals.  Skylink distributes a universal remote that can decode the encrypted rolling code.  In an attempt to control the aftermarket in remote control units, Chamberlain sued.

The court's basic premise is that an element of a DMCA cause of action is an underlying copyright violation -- without such a violation, there can be no remedy.

Updates: According to Ernest Miller, the court rescued the DMCA from "one of its most absurd aspects." He is still concerned, however, that the Act, even as narrowly interpreted, will continue "stifling creativity and innovation." More on the story from copyfight.

Posted by Dennis Crouch | Permalink | Comments (0) | TrackBack

Federal Circuit: Disclosure of only a single embodiment does not result in disavowel of claim scope

Home Diagnostics v. LifeScan (Fed. Cir. 2004) (03-1370).

After construing the claims in this patent infringement lawsuit, the Northern District of California Court held that Home Diagnostics' (HDI) blood glucose meters do not infringe LifeScan's patent on the use of reflectance to determine blood glucose concentration.  (U.S. Patent No. 6,268,162).

On appeal, LifeScan argued that the lower court's claim construction should be overturned.  Specifically, LifeScan argued that the district court overlooked "the accepted contextual meaning" of the method of stopping a measurement period and unduly limited terms to those disclosed in a preferred embodiment.  HDI argued that any broader interpretation was disavowed by LifeScan when they disclosed only a single embodiment.

The Federal Circuit agreed with LifeScan, following their own precedent that disclosure of a single embodiment "does not mean that the patent clearly and unambiguously disavowed other embodiments." 

Reversed-in-part, Vacated-in-part, and Remanded

Posted by Dennis Crouch | Permalink

Paintball Patent Infringement: Smart Parts' Patent Lacks Proper Inventorship

Smart Parts v. WDP (D. Oregon 2004)

In a patent infringement suit over electropneumatic paintball guns, an inventorship controversy arose. Smart Parts contends it is the sole owner of U.S. Patent No. 6,474,326. Dr. Edward Hensel, a former investor, claims to be a co-inventor. Hensel, now acting on behalf of WDP, provided evidence that he designed various elements of the patented invention - namely the electrical timing circuit and bolt action control. In addition, Hensel created a working model in his home. The court agreed that Hensel should be at least a co-inventor and granted summary judgment to WDP on the issue of inventorship.

Links:
Opinion;
Dale Ford's Commentary

-- Dennis Crouch

Posted by Dennis Crouch | Permalink

Aug 30, 2004

Claim term "substantially" is approximate

Dana Corp. v. American Axle  (Fed. Cir. 2004) (not citable as precedent).

In a patent infringement suit, the district court granted summary judgment of non-infringement to the defendant, holding that no reasonable jury could find that the defendant's driveshaft technology infringed plaintiff's patents.

The Federal Circuit vacated, finding that the district court incorrectly ignored the claim phrase  "substantially uniform wall thickness."  According to the Appellate Panel, the term substantially allows for variation in wall thickness.

VACATED and REMANDED

Posted by Dennis Crouch | Permalink

PTO Board Places Enablement Burden on Examiner

Ex parte FALSAFI (BOARD OF PATENT APPEALS AND INTERFERENCES) (2004) (Unpublished)

During prosecution of their patent application for a new dental cement composition, the applicants added the term "about" to modify an upper concentration range. The Examiner rejected addition of "about," arguing that the broadened claims were not enabled.

The specification does not enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the invention commensurate in scope with these claims. Extending the claimed range beyond the range described in the specification is not enabling and is new matter.

On appeal, the BPAI overturned the Examiner's rejection, holding that the Examiner had not "met the required burden of proof for a rejection based on lack of enablement."

The claims are directed to a dental composition and nothing in the specification indicates that minor differences in concentration render the composition unsuitable. The Examiner simply has provided no basis for the conclusion that one of ordinary skill in the art would not have been able to make the dental compositions at the slightly higher levels of the claims, if, indeed, the upper levels are outside the ranges discussed in the specification.

Posted by Dennis Crouch | Permalink

Aug 27, 2004

Federal Circuit: Lifestream Diagnostics v. Polymer Technologies

Lifestream Diagnostics v. Polymer Technologies (Fed. Cir. 2004) (unpublished opinion).

Lifestream sued Polymer Tech for alleged infringement of its patent on HDL cholesterol testing equipment.  (U.S. Patent No. 5,135,716).  After conducting a Markman hearing, the district court awarded a judgment of noninfringement to Polymer Tech.

On appeal, the Federal Circuit reversed in part.

We hold that reliance by the Patent Office upon arguments mae by the patentee during prosecution is not necessary to find argument-based estoppel.... Because we reverse some of the district court's claim construction, we vacate the court's judgment of noninfringement and remand.

Posted by Dennis Crouch | Permalink

Aug 25, 2004

Eolas browser patent fight goes into new phase (Tribune)

Today's Chicago Tribune (subscription) has a nice article on the Eolas case by reporter Barbara Rose.  Most interestingly, her reporting does not fall in line with the trendy headlines like "Microsoft Wins Again," "Two Strikes for Eolas," and "USPTO Close to Rejecting Plug-in Patent."  Rose correctly notes that the Examiner accepted Eolas arguments that prior art submitted by WC3 did not invalidate the patent at issue. 

Doyle's attorney, Martin Lueck, said Eolas and the University of California are "very pleased" that the examiner accepted their arguments.

The examiner wrote that Eolas' rebuttal to his office's previous rejection of the patent's claims "has been fully considered and is deemed persuasive."

Eolas is not out of the water -- the Patent Examiner was able to discover three more references and argue that the combination of those references rendered the Eolas patent obvious.  Eolas must now respond to this new rejection. I was quoted in the article as saying that Eolas is in a "fairly good position." 

-- Dennis Crouch

Posted by Dennis Crouch | Permalink

Aug 24, 2004

USPTO: Inter Partes Reexaminations

Acushnet, the maker of Cobra golf clubs and Titleist balls has requested an inter partes reexamination of Taylor Made Golf Company's patent no. 6,623,378.  In the proceedings, Acushnet will argue that Taylor Made's golf club patent should be held invalid over prior art.

Starting Industrial has also requested an inter partes reexamination of Kioritz Corporation's patented rope recoil starter for an internal combustion engine (U.S. Patent No. 6,588,390).

Link.

 

 

Posted by Dennis Crouch | Permalink

Federal Circuit: A hairbrush has no more relation to a toothbrush than does hair resemble teeth

 

In re Alberto Lee Bigio (Fed. Cir. 2004)

Bigio's patent application claims a hair bursh with an "hourglass configuration for both the bristle substrate and the overall bristle array."  (Patent Application Serial No. 09/451,747).  After receiving obviousness rejections from the Examiner and the BPAI, Bigio pursued his claims at the Federal Circuit. Some of the cited references were designed for use on animals rather than human hair, and Bigio argued that they should not apply because non-human hair brushes where excluded from the patent scope by language in the specification.

[T]he Board rejected Bigio's interpretation of "hair brush" as limited to brushes only for scalp hair.  Instead, the Board broadly construed "hair brush" to encompass "not only brushes that may be used for human hair on [a] scalp, but also brushes that may be used for hairs [o]n other parts of animal bodies (e.g. human facial hair, human eyebrow hair, or pet hair)." 

On appeal, the Appellate Panel (RADER, J.) affirmed, finding that the Board correctly declined to import limitations on terms from the specification.  Next, the Panel found that a toothbrush was an analogous art -- and thus could form a basis of an obviousness rejection.

[I]t is necessary to consider ‘the reality of the circumstances’ – in other words, common sense – in deciding in which fields a person of ordinary skill would reasonably be expected to look for a solution to the problem facing the inventor.”  In re Oetiker, 977 F.2d 1443, 1447 (Fed. Cir. 1992) [].  Accordingly, the examiner and the Board must consider the “circumstances” of the application – the full disclosure – and weigh those circumstances from the vantage point of the common sense likely to be exerted by one of ordinary skill in the art in assessing the scope of the endeavor. ...

[T]he Board applied the test for analogous art in keeping with the counsel of this court's predecessor:  "The differences are mere change of size and substitution of material of the most obvious kind, on a par with the differences between a hairbrush and a toothbrush."  In re Wolfe, 251 F.2d 854, 856 (CCPA 1958). Thus, on this record, this court affirms the findings of the Board and upholds its traditional tests for determining the scope of prior art analogous to the claimed invention.  

In Dissent, Judge Newman argued that the toothbrush should not be considered a 103(a) reference.

The toothbrush art is not analogous to the hair brush art.  Bigio's patent application is directed to a hair brush, and his claims are limited to a hair brush. 

Newman concluded with the money quote: "A brush for hair has no more relation to a brush for teeth than does hair resemble teeth."

 

 

Posted by Dennis Crouch | Permalink

Aug 23, 2004

Federal Circuit: Koito Manufacturing v. Turn-Key-Tech (Patent Case)

 

Koito Manufacturing v. Turn-Key-Tech (Fed. Cir. 2004) (PDF).

 

In February 2002, Koito brought a declaratory judgment action against Turn-Key, requesting that Turn-Key's patent covering an injection molding technique be declared invalid, unenforceable, and not infringed. (U.S. Patent 5,045,268). The Jury issued a special verdict finding the patent invalid for lack of enablement, written description, and the addition of new matter. Additionally, the Jury found that the patent was not infringed and that several claims were anticipated and obvious. After the verdict, however, the district court judge granted in-part Turn-Key's JMOL.  On appeal, the Federal Circuit affirmed-in-part and remanded.  The Appellate Panel held that Koito had not met its burden of showing non-enablement, lack of written description, impermissible new matter, anticipation, or obviousness.

 We affirm (1) the jury’s verdict that Koito did not infringe the ’268 patent and (2) the district court’s grant of a JMOL with respect to the jury’s finding that the ’268 patent was not enabled, did not meet the written description requirement, and impermissibly added new matter.  However, we vacate the district court’s denial of Turn-Key’s JMOL with respect to anticipation and obviousness.  On remand, the district court should evaluate the evidence proffered by Koito ... to determine whether the jury’s verdict of anticipation and obviousness was adequately supported.

Affirmed-in-part, Vacated-in-part, and Remanded.

 

Update:

The unanimous decision, which was returned by a three-judge panel on Monday, August 23, upheld an April 2003 jury verdict in the same case.  As in this case, the court found that the manufacturing process Koito used to mold plastic tail light lenses in no way infringed on a patent for another process that was held by Turn-Key-Tech. (LINK)

Posted by Dennis Crouch | Permalink

Court: FDA's Role is Not to Analyze Patent Claims

Alphapharm PTY v. Tommy G. Thompson (Secretary of HHS) (D.D.C. 2004) (CA 03-2269).

 

By Mark Chael

Recently, the District Court in Washington, D.C. agreed with the Federal Circuit, the Fourth Circuit, and a District Court in Maryland by determining that the listing of patents in the Orange Book by the Food and Drug Administration (FDA) is merely “a ministerial act” and that the Hatch-Waxman Act does not require the FDA “to police the listing process by analyzing whether the patents listed by NDA (New Drug Application) applicants actually claim the subject drugs or applicable methods of using those drugs.”

 

In a case captioned, Alphapharm PTY Limited v. Tommy G. Thompson, the court reasoned that substantive patent analysis is beyond the expertise of the FDA and is a function they are not mandated to perform.  Rather, substantive patent analysis is better left with the U.S. Patent and Trademark Office. The function of the FDA, on the other hand, is to assure the safety and availability of useful pharmaceutical compounds.  The laws and regulations that govern the FDA, in particular those laws and regulations that govern the listing of patents in the Orange Book, “commit the resolution of disputes between ANDA (Abbreviated New Drug Application) applicants and patent holders regarding the validity or correctness of the listed patent information to actions between ANDA applicants and patent holders, rather than to FDA action.”

Note: This is the first post by patent attorney Mark Chael, PhD.  Mark's prior research in biochemistry, molecular biology, and cellular biology make him well equipped to understand the intricacies involved in biotech and pharmaceutical patents. He is an associate at the intellectual property law firm McDonnell Boehnen Hulbert & Berghoff in Chicago. [Brief Biography]

Posted by Dennis Crouch | Permalink

Aug 22, 2004

ITC Issues Order to Stop Importation of Unlicesed Viagra Imitations

In the Matter of Certain Sildenafil (International Trade Commission) (Inv. No. 337-TA-489).

Pfizer brought this complaint against 15 companies that were importing forms of Viagra (sildenafil citrate) that infringed its patent.  (U.S. Patent No. 5,250,534).  In its decision, the ITC issued a general exclusion of such importation.  The Commission found that the general exclusion was necessary because of the difficulty in identifying the source of the infringing products and because of the ease that sellers can mask or change their identity by operating over the Internet.

Pfizer has demonstrated that suppliers of infringing products could readily mask their identity or be replaced by other suppliers. Further, Pfizer has shown that there is a pattern of violation of section 337 and that it is difficult to identify the source of infringing products. As Pfizer has noted, eleven defaulting respondents have been found to be in violation of section 337. Pfizer has also shown that it is difficult to identify the source of infringing products, many of whom deal directly with U.S. customers over the Internet and can readily mask or change their identity.

Further, the Commission considered it important that Pfizer has established a strong market for its product and that foreign manufacturers can easily copy the pharmaceutical.

Comment: A General Exclusion Order is a broad remedy issued by the ITC that is directed to any article that infringes the patents-in-suit, rather than just those of the named respondents. Therefore, the exclusion applies to parties that were not part of the ITC proceedings. 

Download PDF of Decision.

Posted by Dennis Crouch | Permalink

Aug 20, 2004

Grokster not liable

In an extremely well written opinion by Judge Thomas of the 9th Circuit, the appellate court found that Grokster is not liable for the peer-to-peer swapping of copyrighted songs that occurs through its file-sharing software. 

In the context of this case, the software design is of great import. As we have discussed, the software at issue in Napster I and Napster II employed a centralized set of servers that maintained an index of available files. In contrast, under both StreamCast’s decentralized, Gnutella-type network and Grokster’s quasi-decentralized, supernode, KaZaa-type network, no central index is maintained. Indeed, at present, neither StreamCast nor Grokster maintains control over index files. As the district court observed, even if the Software Distributors “closed their doors and deactivated all computers within their control, users of their products could continue sharing files with little or no interruption.” Grokster I, 259 F. Supp. 2d at 1041. Therefore, we agree with the district court that the Software Distributors were entitled to partial summary judgment on the element of knowledge. [Because knowledge is a required element of contributory copyright infringement, Grokster could not be held liable.]

NOTE: This does not mean that individual users will not be held liable for copyright infringement using Grokster.

The opinion is rather short and easy to read: Opinion in PDF format.  Give it a go. Update: More information from the INDUCE Act Blog.

Pear-to-Pear communication:

Posted by Dennis Crouch | Permalink

Federal Circuit: Utica Enterprises v. Federal Broach and Machine

Utica Enterprises v. Federal Broach and Machine (Fed. Cir. Aug. 19, 2004) (nonpublished opinion).

Utica sued Federal Broach for infringement of its patented metal finishing process, known as "broaching." (U.S. Patent No 6,256,857).  After construing the claims in a Markman hearing, the Michigan district court entered summary judgment of non-infringement for Federal Broach.

Utica appealed the judgment, arguing incorrect claim construction. The Federal Circuit (LOURIE, J) held that the court unduly limited claim terms, and thus vacated and remanded.  Mayer, CJ, dissented without opinion.

Posted by Dennis Crouch | Permalink

Aug 18, 2004

Poster Presentation at Conferences Constitutes 102(b) Printed Publication

In re Klopfenstein and Brent (Fed. Cir. 2004) (three day poster presentation at academic conference without any paper distribution or indexing was a printed publication under 102(b)).

More than one year prior to filing their application, the inventors of a new method of peparing foods using extruded soy fiber presented a poster presentation at two academic conferences (for a total of less than 3 days).  No copies of the presentation were distributed.  The Patent Examine rejected the claims as anticipated by the prior publication.  The applicants did not dispute that the presentation fully disclosed the invention.  Rather applicants argued that the presentation was not a prior art publication under 35 USC 102(b).

The only question in this appeal is whether the Liu reference constitutes a "printed publication" for the purposes of 35 U.S.C. § 102(b).  As there are no factual disputes between the parties in this appeal, the legal issue of whether the Liu reference is a "printed publication" will be reviewed de novo.

The Appellate Panel affirmed the rejection holding that  distribution or indexing is not required of printed publications. 

The reference itself was shown ... to members of the public having ordinary skill ... Those members of the public were not precluded from taking notes or even photographs of the reference.  And the reference itself was presented in such a way that copying of the information it contained would have been a relatively simple undertaking for those to whom it was exposed-particularly given the amount of time they had to copy the information and the lack of any restrictions on their copying of the information.  For these reasons, we conclude that the Liu reference was made sufficiently publicly accessible to count as a "printed publication" under § 102(b).

Posted by Dennis Crouch | Permalink

Federal Circuit: Fisher-Price v. Safety 1st

Fisher-Price v. Safety 1st (Fed. Cir. 2004) (not citable as precedent)

Fisher-Price is the assignee of several patents on baby items, such as carriers, strollers and bassinets.  (e.g., U.S. Patent No. 6,274,755).  Fisher-Price sued Safety 1st for infringement and won a jury trial.  The district court denied Safety 1st's JMOL motion on validity, infringement, and the period of damage recovery.  Safety 1st appealed.

The Federal Circuit affirmed, finding that the patents were valid and infringed.  Ironically, the only modification to the district court's order was to expand the scope of damages in Fisher-Price's favor.

Posted by Dennis Crouch | Permalink

Frivolous arguments over FJC patent video

Just a snippet of this case out of Iowa: Engineered Products v. Donaldson Co. (N.D. Iowa 2004)

Donaldson was found liable for infringement of Engineered Product's patent on a mechanical air filter. (U.S. Patent No. 4,445,456).  In a post trial argument, Donaldson's attorneys argued that the patent law videotape prepared by the Federal Judicial Center, which was intended to provide potential jurors with an introduction to patent law should not have been shown during jury selection.  The judge was not happy with this argument:

While the undersigned has been restrained in his ten years as a federal district court judge about characterizing any party’s argument as “frivolous,” Donaldson’s argument concerning use of the videotape is one of the rare ones for which the undersigned can find no other characterization. Zealous representation at times requires judicious determination of which arguments are worth advancing or preserving, and which are not, or the credibility of even meritorious arguments may be called into question by the assertion of meritless ones.

Donaldson announced that it intends to "vigorously challenge the judgment and will appeal the decision to the Federal Circuit Court of Appeals."  The appeal will likely be on other grounds.  The patent expired in 2001, but EPC was suing for past damages.

Posted by Dennis Crouch | Permalink

Aug 17, 2004

Federal Circuit: Linear Technology v. Impala Linear and Maxim Integrated

Linear Technology v. Impala Linear and Maxim Integrated (Fed. Cir. 2004)

After losing an appeal last month, Maxim filed a request for an en banc rehearing.  Although the court denied the petition to rehear, it did issue a substitute opinion in the case.

Summary:

Because genuine issues of material fact have been raised concerning Maxim’s contributory infringement or inducement, we vacate the district court’s summary judgment of no contributory infringement or inducement of the current reversal method claims of the ’178 patent.  Because Maxim failed to raise a genuine issue of material fact, the matter of inventorship was amenable to determination on summary judgment on the undisputed factual premises.  On these premises, the district court correctly held that Vinsant was not a joint inventor of the ’178 patent.

As in the prior opinion,the court found error in the district court's claim construction.  Vacated-in-part, affirmed-in-part, and remanded.

Read the original federal circuit opinion.

Posted by Dennis Crouch | Permalink

Aug 16, 2004

Federal Circuit: In re WILHELM ELSNER

In re WILHELM ELSNER (Fed. Cir. 2004)

German plant breeder William Elsner filed for a plant patent on his new variety of geraniums.  After receiving a 102(b) rejection from the Examiner that was affirmed by the BPAI, Elsner appealed to the Federal Circuit.

The Appellate Panel vacated and remanded.

We agree that the publication of the (international) applications coupled with foreign sales of the plants may constitute a §102(b) bar to patentability.  However, because the record is silent on the extent to which the foreign sales were known to the public, and because the Board did not adequately address the degree to which availability of the plants through foreign sales enabled the preparation of the claimed plants, we vacate the Board’s decisions in both cases and remand for further proceedings.

Posted by Dennis Crouch | Permalink

Aug 13, 2004

Public Use Evidence Required: Aspex Eyewear v. Concepts in Optics

Aspex Eyewear v. Concepts in Optics (Fed. Cir. August 12, 2004) (not citable as precedent).

Aspex sued Concepts for infringement of its patented technology that covers a magnetically attachable auxillary lens for eyeglasses. (U.S. Patent No. RE 37,545 E). The district court granted summary judgment for the defendant based on a finding of invalidity under 35 USC 102 -- finding that another person had invented the claimed eyeglasses before the critical date.

On appeal, the Appellate Panel reversed and remanded for two primary reasons:

1) drawings relied upon by the district court were not "printed publications" because there was no evidence of public availability; and
2) the testimony of prior public use (or "known ... by others") was not incontestable on summary judgment.

Posted by Dennis Crouch | Permalink

Aug 12, 2004

ITC: Plastic Bag Import Restrictions

The International Trade Commission (ITC) has issued a general exclusion order prohibiting the unlicensed entry of plastic grocery and retail bags that infringe Superbag's patented technology. (U.S. Patent No. 5,188,235). The Commission also determined that "public interest factors" do not preclude the issuance of the exclusion order.

Superbag had filed a complaint against four parties:

Thai Plastic Bags of Thailand; Hmong Industries of St. Paul, Minnesota; Spectrum Plastics of Cerritos, California; and Pan Pacific Plastics of Union City, California.

Read the full order here.
Thanks to IP-Updates for the link.

Posted by Dennis Crouch | Permalink

Aug 11, 2004

Federal Circuit: In Re David Wallach

In re David Wallach (Fed. Cir. 2004).

By Donald Zuhn

In an appeal from a decision of the PTO Board, the Federal Circuit affirmed the rejection of claims directed to isolated DNA molecules encoding TNF binding protein II (TBP-II) under the written description requirement of 35 U.S.C. § 112.

Appellants had purified TBP-II from urine and determined (a) the amino acid sequence of an N-terminal portion of the protein, (b) the protein’s molecular weight, and (c) that the protein inhibited TNF activity. Appellants then pursued, in separate divisional applications, claims directed to proteins having the partial sequence, molecular weight, and inhibitory activity described and claims directed to isolated DNA molecules encoding such proteins. The DNA claims were rejected under § 112 as lacking an adequate written description in the specification. Appellants appealed to the Board, which affirmed.

Appellants asserted that because the PTO had effectively conceded that claims to the TBP-II protein were adequately described in the specification, the claims to isolated DNA molecules encoding the TBP-II protein were therefore adequately described in the specification. Specifically, Appellants argued that because the complete amino acid sequence of a protein is an inherent property of an isolated, fully characterized protein, and the determination of a protein’s complete amino acid sequence puts one in possession of all DNA sequences encoding that protein (as a result of the unequivocal correspondence between amino acids and DNA codons in the genetic code), Appellants’ full characterization of TBP-II (i.e., determination of its N-terminal amino acid sequence, molecular weight, and inhibitory activity) demonstrated possession of all DNA sequences encoding TBP-II. The PTO countered that because Appellants’ specification included neither the complete amino acid sequence of TBP-II nor any actual DNA sequence, and disclosed the sequence of only ten of the 185-192 amino acids that make up TBP-II, Appellants had not demonstrated possession of all DNA sequences encoding TBP-II.

The Court noted that while “the state of the art has developed such that the complete amino acid sequence of a protein may put one in possession of the genus of DNA sequences encoding it,” Appellants had not disclosed the complete amino acid sequence of TBP-II, but rather, had provided only a partial sequence of the protein. In addition, the Court concluded that Appellants’ possession of TBP-II “says nothing about whether they were in possession of the protein’s amino acid sequence [since] Appellants have not provided any evidence that the full amino acid sequence of a protein can be deduced from a partial sequence and the limited additional physical characteristics that they have identified.” With respect to the DNA claims at issue, the Court determined that absent a description of the complete TBP-II amino acid sequence or any evidence of a “known or disclosed correlation between the combination of a partial structure of a protein, the protein’s biological activity, and the protein’s molecular weight, on the one hand, and the structure of the DNA encoding the protein on the other,” the Board’s decision to affirm the rejection of Appellants’ DNA claims was proper.

NOTE: This is the first post by patent attorney Donald Zuhn, PhD. Don is a true expert in cutting edge biotech patent law and practices both prosecution and litigation at McDonnell Boehnen Hulbert & Berghoff LLP in Chicago. [Brief Biography].

Posted by Dennis Crouch | Permalink

INNOVA / Pure Water v. Safari Filtration Systems

INNOVA / Pure Water v. Safari Filtration Systems (Fed. Cir. 2004) (CLEVENGER, Rader, and Linn, JJ.)

Innova sued Safari for infringement its patented water filter assembly. (U.S. Patent No. 5,609,759). After construing the claims, the District Court (M.D. Florida) granted Safari's motion for summary judgment of noninfringement.

Innova's appeal with patent turns on the correct interpretation of the disputed claim term, "operatively connected." In particular, Innova challenged that the District Court improperly imported a "tenacious physical engagement" limitation into claim language that does not require any such thing. The Appellate Panel agreed and vacated the decision in-part.

The district court erred. The asserted claims do not require that the filter tube and cap be affixed to one another in a manner that results in the two components forming a unitary structure. Neither party asserts that the term "operatively connected" is a technical term having a special meaning in the art of water filtration. Rather, it is a general descriptive term frequently used in patent drafting to reflect a functional relationship between claimed components. Generally speaking, and as used in the '759 patent, it means the claimed components must be connected in a way to perform a designated function. In the absence of modifiers, general descriptive terms are typically construed as having their full meaning.

Remanded for further proceedings.

Posted by Dennis Crouch | Permalink

Aug 10, 2004

Federal Circuit: Neomagic v. Trident Microsystems

NeoMagic v. Trident Microsystems (Fed. Cir. 2004) (04-1046)(NONPRECEDENTIAL).

NeoMagic sued Trident for infringement of its patent covering a graphics engine/memory integrated circuit (U.S. Patent No. 5,703,806). After construing the claims in a Markman hearing, the Delaware District Court dismissed the suit on summary judgment based, holding that the claims were not infringed as a matter of law. In a first appeal, the Federal Circuit remanded based on improper claim construction.

After a second summary judgment dismissal for noniningringement, the case appeared before the Federal Circuit again. This time, the Appellate Panel affirmed the dismissal, holding that the dismissal was proper because Trident's products did not have a "second power supply" as recited in the claims.

Full Case PDF.

Posted by Dennis Crouch | Permalink

Aug 05, 2004

Public Use: Engate v. Esquire Deposition

Engate, Inc. v. Esquire Deposition Services (N.D. Ill. 2004)

In a patent infringement suit over Engate's patented real-time transcription service technology, the District Court dismissed the defendant's unfair competition counterclaim and granted in part defendant's summary judgment of invalidity. The court looked to instances of real-time transcription in some courtrooms as evidence of public use sufficient to invalidate some of the claims.

Posted by Dennis Crouch | Permalink

Aug 03, 2004

Trademark Case: Jose Gaspar Gold

IN RE CHATAM INTERNATIONAL INCORPORATED (Fed. Cir. 2004) (Trademark Case)

The Federal Circuit (RADER with CLEVENGER and SCHALL) affirmed the TTAB's decision to refuse to register the mark JOSE GASPAR GOLD in connection with tequila because of a perceived likelihood of confusion with GASPAR's ALE.

Although the two names had only GASPAR in common, the court found that the other terms could be disregarded from the analysis because 1) ALE is generic; 2) GOLD establishes premium quality rather than name recognition; and 3) JOSE simply reinforces GASPAR as a name.

The court also supported the Board's finding of a close relationship between tequila and beer or ale.

In this case, as in Majestic Distilling, the Board correctly determined that tequila and beer or ale are inexpensive commodities that consumers would be unlikely to distinguish by manufacturer.

Posted by Dennis Crouch | Permalink

Aug 02, 2004

Federal Circuit: Lack of Enablement Affirmed

ELSTER ELECTRICITY v. SCHLUMBERGER (Fed. Cir. 2004) (NONPRECEDENTIAL)

In this appeal of a summary judgment of invalidity for lack of enablement, the Federal Circuit affirmed.

Elster's patent relates to a power supply of an electric energy meter that uses a specialized transformer. (U.S. Patent 5,457,621). At the district court, the judge found that the patent lacked enablement because the specification only enabled a "controller that responds to the third winding," while the claim required a response to the "second winding." Elster appealed, but the Appellate Panel affirmed, holding that the "written description fails to teach a response between the second and third winding, the district court ccorrectly concluded that [the] claims ... were not enabled."

Posted by Dennis Crouch | Permalink

Jul 29, 2004

Battle over Pet Food: Mars v. Heinze & Del Monte

Mars v. Heinze & Del Monte (Fed. Cir. July 29, 2004).

Mars filed a patent infringement suit against Heinze, alleging infringement on its patented pet food. (U.S. Patent 6,312,746)(A dual texture animal food product with a soft inner component surrounded by a harder, more rigid shell). After a Markman hearing, the district court issued summary judgment of noninfringement to Heinze.

On appeal, the Federal Circuit breathed new life into Mars' claims by issuing a new construction of claim terms and remanding.

We conclude that: (1) “ingredients” as used in the phrase “a mixture of lipid and solid ingredients” refers to the components of the inner core at any time after they have been mixed together, and (2) the phrase “containing a mixture” is open-ended. Thus, the claim language, “containing a mixture of lipid and solid ingredients,” does not exclude the presence of additional, unnamed ingredients in the inner core mixture that are neither lipids or solids. Since genuine issues remain as to infringement under this construction, we vacate the district court’s grant of summary judgment of non-infringement and non-infringement under the doctrine of equivalents and remand for further consideration.

Vacated and Remanded

Posted by Dennis Crouch | Permalink

Federal Circuit: Best Mode Not Intentionally Concealed

High Concrete Structures v. New Enterprise Stone and Lime (Fed. Cir. July 29, 2004).

On appeal from a district court’s summary judgment based on failure to comply with the best mode requirement, the Federal Circuit (Newman, Mayer, Clevenger) reversed and remanded.

High Concrete sued New Enterprise for infringement of its patent on “double-tees” for adjusting the orientation of bulky cargo. (U.S. Patent No. 5,947,665). On defendants’ motion, the district court held the patent invalid for “failing to disclose that the inventors' preferred mode of practicing the invention was to use the crane to tilt the loaded frame at the time that the crane loaded the cargo onto the frame.”

The appellate panel reversed:

Deliberate concealment is not charged. The best mode requirement of §112 is not violated by unintentional omission of information that would be readily known to persons in the field of the invention … Known ways of performing a known operation cannot be deemed intentionally concealed absent evidence of intent to deliberately withhold that information.

Posted by Dennis Crouch | Permalink

Jul 27, 2004

Katz Technology Licensing Reexamination

Another Ronald A. Katz patent is up for reexam. An ex-parte reexamination has been requested for U.S. Patent No. 5,561,707 (Telephonic-Interface Analysis System). Interestingly, this same patent is undergoing a director ordered reexamination.

More info here.

Does anyone know what is happening in this case?

Posted by Dennis Crouch | Permalink | Comments (0)

Jul 23, 2004

Phillips v. AWH: Chief Judge Mayer's Dissent

The Federal Circuit has created a stir in its recent decision to grant an en banc review of Phillips v. AWH.

Chief Judge Mayer dissented from the court's decision to review. Mayer argued that the real question for review is whether Markman was correctly decided.

Until the court is willing to reconsider its holdings in Markman v. Westview Instruments ... that claim construction is a pure question of law subject to de novo review in this court, any attempt to refine the process is futile. Nearly a decade of confusion has resulted from the fiction that claim construction is a matter of law, when it is obvious that it depends on underlying factual determinations which, like all factual questions if disputed, are the province of the trial court, reviewable on appeal for clear error. To pretend otherwise inspires cynicism. Therefore, and because I am convinced that shuffling our current precedent merely continues a charade, I dissent from the en banc order.

My former boss, Patricia Thayer at Heller Ehrman commented in the Recorder that she thinks Mayer may get his wish.

"I'd love it if the federal district courts got together" to write an amicus brief on the issue, Thayer said. "It's difficult for them that [they are accorded] no deference. I wouldn't be surprised if that gets changed in the process."

This is the fourth article in our coverage of the Phillips en banc appeal. Read Part I, Part II, and Part III.

Posted by Dennis Crouch | Permalink

Phillips v. AWH: Rader Concurring

This is Part III of our coverage of the Phillips - AWH en banc order. Read Part I and Part II.

... In concurrence, Judge Rader argued for en banc ruling on another issue. Rader's concern is whether claim construction is even amenable to "strictly algorithmic rules." As an example, Rader questions whether an approach of first looking at the specification, folowed by examining dictionary definitions would be workable. Alternatively, claim construction may be better achieved by chosing a methodology on a case by case basis -- "thus entrusting trial courts to interpret claims as a contract or statute."

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Jul 21, 2004

Using Dictionaries in Claim Construction

PHILLIPS v. AWH CORPORATION (Fed. Cir. 2004)

The Federal Circuit has agreed to rehear the appeal en banc in order to resolve issues concerning the construction of patent claims and the use of dictionaries. The following questions are to be briefed:

1. Is the public notice function of patent claims better served by referencing primarily to dictionaries to interpret a claim term or by looking primarily to the patentee’s use of the term in the specification?

2. If dictionaries should serve as the primary source for claim interpretation, should the specification limit the full scope of claim language (as defined by the dictionaries) only when the patentee has acted as his own lexicographer or when the specification reflects a clear disclaimer of claim scope? If so, what language will satisfy those conditions?

3. If the primary source for claim construction should be the specification, what use should be made of dictionaries?

4. Instead of viewing the claim construction methodologies in the majority and dissent of the now-vacated panel decision as alternative, conflicting approaches, should the two approaches be treated as complementary methodologies such that there is a dual restriction on claim scope, and a patentee must satisfy both limiting methodologies in order to establish the claim coverage it seeks?

5. When, if ever, should claim language be narrowly construed for the sole purpose of avoiding invalidity.

6. What role should prosecution history and expert testimony play in determining the claim term meaning?

7. Is it appropriate for this court to accord any deference to any aspect of trial court claim construction rulings? If so, on what aspects, in what circumstances, and to what extent?

Amicus curiae briefs may be filed and should be limited to 5,000 words, and be filed within sixty days from the date of this Order.

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ThermoGenesis v. PharmaStem

The USPTO has announced a reexamination request of PharmaStem Therapeutics patent on technology for the "preservation of fetal and neonatal hematopoeitic stem and progenitor cells of the blood." (U.S. Patent 5,004,681). The reexam was requested by a competitor, ThermoGenesis.

ThermoGenesis commented that it "made the request for re-examination based on our assessment that these patent claims do not distinguish over the “prior art,” including the publication of several medical journal articles describing similar techniques that predated the patents." According to Nicholas Didier, President and CEO of PharmaStem, approximately two thirds of the cord blood banking industry operates under a PharmaStem license.

The patent at suit issued in 1991 and survived a first reexamination in 2000.

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Jul 20, 2004

Eli Lilly v. Aradigm

In an inventorship dispute, over an insulin delivery system, the federal circuit (LOURIE, CLEVENGER, and GAJARSA) reversed a jury's verdict to add an inventor to the disputed patent.

While circumstantial evidence may in some cases be sufficient to surmount the clear and convincing evidence burden of proof, we conclude that the circumstantial evidence presented here is insufficient and that the jury's verdict cannot stand.

In a concurring opinion, LOURIE argued that the burden of to show joint inventorship should be a preponderance of the evidence rather than clear and convincing.

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Jul 19, 2004

Federal Circuit Revives Patent Suit Against the State of California

California Department of Transportation v. Tycor Walls, Inc. (Fed. Cir. 2004) (not citable as precedent).

Tycor sued the California DOT for infringement of its patented retaining wall technology. (U.S. Patent 6,036,405). The trial court granted summary judgment to the DOT based on its noninfringement analysis. On appeal, the Federal Circuit vacated, holding that the lower court "erred in its analysis of infringement under the doctrine of equivalents."

The Appellate Panel (LOURIE, FRIEDMAN, CLEVENGER) found that equivalents of a claimed "slot" need not perform a "sliding function" as requred by the lower court.

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Jul 14, 2004

Huang v. CIT (Lab Notebook Must be Witnessed)

Huang v. California Institute of Technology (C.D. Cal. 2004)

Dr. Huang sued, alleging that he should be a named inventor of CIT's automatic DNA sequencing patents. As evidence, Dr. Huang submitted his own testimony and his laboratory notebooks. The Court found that the lab notebooks were insufficient because they were not witnessed or reliably dated.

Only in those instances where Dr. Huang's lab notebooks were corroborated by independent evidence were they considered at all persuasive.

Find more information here and here.

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Jul 13, 2004

AFG INDUSTRIES and ASAHI GLASS v. CARDINAL IG and ANDERSEN WINDOWS

AFG Indus. v. Cardinal IG CO. (Fed. Cir. July 13, 2004)

In an infringement suit involving AFG and ASAHI’s patented window treatment, the District Court (E.D. Tenn) held that Cardinal did not infringe. (U.S. Patent 4,859,532). On appeal, the Federal Circuit (RADER) vacated and remanded.

A structure that falls within the meaning of “layer” due to its structure and optical properties remains a single layer whether it was deposited in a single sputtering operation or multiple operations. By the same token, that unitary structure of the same material that constitutes a “layer” does not become multiple layers because the manufacturer decided to deposit it in multiple passes rather than in a single pass. The method of making is not determinative of the structure and properties of a “layer.” Because the trial court considered the method of creating the layer dispositive of its structure and character in the accused LoE2 products, this court vacates the grant of summary judgment.

Because genuine issues of material fact preclude summary judgment of noninfringement of the ’532 patent, this court vacates and remands.

In dissent, J. NEWMAN argued that the case should not be remanded again, but rather, should be decided by the appellate panel.

I respectfully dissent from the panel's decision to remand this case for the third time on the issue of claim construction with respect to the claim term "layer." Claim construction is a matter of law, and as such it receives de novo review. The purpose is objective correctness; the record is complete, the question is ripe. It is time for decision, not for remand.

There have been three Markman hearings and now three appeals, all directed to the meaning of the term "layer." For the first two hearings the definition was applied to the titanium dioxide deposits, and in the second appeal this court held that a layer is a material of optically significant uniform chemical composition. In the third Markman hearing the district court held that Cardinal's multiple deposits of its center zinc oxide component produced multiple layers. This court now appears to hold that its definition in the previous appeal, wherein "layer" was defined in the context of the "interlayers" of titanium dioxide, bars the district court from considering the additional aspect of whether multiple sputtering deposits can produce multiple "layers," unless they affect the structure and optical properties. However, when the later claim construction is made in a different technical context from that which was earlier considered, in the interest of correctness the court must consider the new context.

This case was filed in 1996. Before the district court the parties produced extensive evidence, in the form of expert and other witness testimony, and physical exhibits and demonstrations. The district court has three times held, on summary judgment upon deciding the legal question of claim construction, that there is no infringement. It is a relatively simple technical question, for which the record is fully developed. After eight years this question of law requires finality, not a fourth cycle of Markman hearing and appeal. From my colleagues' remand for this purpose, I respectfully dissent.

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Jul 12, 2004

Unitherm Food v. ConAgra: Patent Antitrust Holding Vacated, Tortious Interference Affirmed

UNITHERM FOOD SYSTEMS, INC. and JENNIE-O FOODS, INC. v. SWIFT-ECKRICH, INC. (doing business as Conagra Refrigerated Foods) (Fed. Cir. July 11, 2004).

In a declaratory action over a method of browning precooked meats, an Oklahoma district court granted summary judgment of invalidity and unenforceability based on both prior use and prior sale of ConAgra's patented method. (United States Patent 5,952,027). In addition, the Jury determined that ConAgra's pre-litigation actions constituted tortious interference and created antitrust violations.

On appeal, the Federal Circuit (GAJARSA) affirmed all appealed actions except for the antitrust holdings.

Because the district court erred, however, in allowing the jury to decide Unitherm’s antitrust claims despite the total absence of economic evidence capable of sustaining those claims, we vacate the judgment finding ConAgra liable for violating § 2 of the Sherman Act. We also vacate all damages awarded consequent to antitrust liability. We remand the matter to the district court for further proceedings consistent with this opinion.

Prior to litigation, ConAgra wrote to several companies who sell equipment for preparing and browning pre-cooked meats. ConAgra attached a copy of the ‘027 Patent to that letter, which included the explicit warning:

“Others in the industry may approach your company regarding this patent, and we would appreciate it if you would inform them that we intend to aggressively protect all of our rights under this patent.”

These letters formed the basis of Unitherm and Jennie-O's claims of tortious interference. Surprisingly, the court did not mention the "objectively baseless" standard that it recently outlined in Globetrotter Software.

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Jul 09, 2004

Taser Prevails in Patent Infringement Appeal at Federal Circuit

McNulty v. Taser (Fed. Cir. July 7, 2004) (NONPRECEDENTIAL)

Plaintiff McNulty is the exclusive licensee of a patent entitled "Stun Gun with Low Battery Indicator and Shutoff Timer." (U.S. Patent 5,193,048). The district court granted summary judgment of non-infringement to Taser and the other co-defendants (Cities of Los Angeles, Ontario, and Buena Park California).

On appeal, the Federal Circuit affirmed,

Accepting all of McNulty's evidence as true and drawing all inferences in his favor, we agree with the district court that there is no genuine issue of material fact and that Taser's U3400 and M-series products do not infringe the "trigger means" limitation.... Accordingly, the decision of the district court is affirmed.

Update from TASER's Press Release:

"We were confident that the District Court's ruling would be upheld," said Doug Klint, Vice President and General Counsel for TASER International, Inc. "Our intellectual property portfolio is very strong, and there was never any evidence that TASER International infringed on Mr. McNulty's patent. We feel vindicated that both the District Court and the Court of Appeals have ruled in our favor," concluded Mr. Klint.

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Federal Circuit gives Paint-Roller Patentee Chance for a Second Coat

Diversified Dynamics v. Wagner Spray Tech (Fed. Cir. 2004) (NONPRECEDENTIAL)

In a patent infringement suit involving Diversified's patented "duckbill check valve" for controlling paint flow to a paint-roller, the Federal Circuit reversed the district court's dismissal of claims. The appellate panel found that a prior settlement agreement between the parties did not bar the present suit.

We conclude that the plain language of the release requires a narrow construction. The plain language releases Wagner from “any and all actions … arising out of or in any way related to the ‘176 Patent” (emphasis added). We agree with both of the parties that the release is unambiguous; however, we agree with Diversified as to its proper construction. The phrases “arising out of” and “in any way related to” refer back to the ‘176 patent and require a relationship between the action and the patent itself. We similarly note the order of the language in the release. Under the language of the release, the issue is whether an action is related to the ‘176 patent, not whether the ‘176 patent is related to the action.
Based on our reading of the release, we conclude that the district court improperly construed it to preclude Diversified’s suit on the ‘123 patent. As discussed, we focus on the nature of the action and its relation to the ‘176 patent. Here, the action arises out of and is related to the ‘123 patent.

Reversed and remanded.

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Jul 08, 2004

Federal Circuit: U.S. Patent Laws Require Physical Supply or Manufacture of Components Within the U.S.

PELLEGRINI v. ANALOG DEVICES (Fed. Cir. July 8, 2004)

Plaintiff Pellegrini appealed to the Federal Circuit after the district court granted partial summary judgment in favor of Analog. In the patent infringement suit, Pellegrini alleged that Analog was infringing its patented brushless motor drive circuits. (U.S. Patent 4,651,069). Because of Analog's international manufacturing process, the case provided a novel question for the Federal Circuit.

This case presents the question whether components that are manufactured outside the United States and never physically shipped to or from the United States may nonetheless be “supplie[d] or cause[d] to be supplied in or from the United States” within the meaning of 35 U.S.C. § 271(f)(1) if those components are designed within the United States and the instructions for their manufacture and disposition are transmitted from within the United States. This is a matter of first impression for this court. According to § 271(f)(1),

Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such a manner as to actively induce the combination of such components outside the United States in a manner that would infringe the patent if such combination occurred within the United States shall be liable as an infringer.

35 U.S.C. § 271(f)(1) (2000). Section 271(f) was enacted in the wake of the United States Supreme Court’s decision in Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518 (1972), in which the Court acknowledged that unauthorized manufacturers of patented products could avoid liability for infringement under the then-existing law by manufacturing the unassembled components of those products in the United States and then shipping them outside the United States for assembly. Congress enacted § 271(f) in order to close that loophole.

In its opinion, the appellate panel determined that Section 271 requires "physical supply of components, not simply to the supply of instructions or corporate oversight." Because the U.S. division of Analog only provided designs and corporate oversight, no infringing activity took place. Affirmed.

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NOVARTIS v. ABBOTT (JMOL of noninfringement of Novartis patents affirmed)

NOVARTIS PHARMACEUTICALS CORPORATION v. ABBOTT LABORATORIES (Fed. Cir. July 8, 2004).

Novartis brought a patent infringement suit against Abbott based on its patented cyclosporin compositions. (U.S. Patent 6,007,840). A jury determined that Abbott infringed claim 81 of the '840 patent. However, the district court issued a judgment as a matter of law (JMOL) of noninfringement in Abbott's favor.

On appeal, the appellate panel found that the district court's claim construction was erroneous, but that those errors were harmless to the JMOL decision. Affirmed.

In dissent, J. BRYSON argued that the court unduly applied the the specific exclusion principle to narrowly construe the term "lipophilic component."

The statement on which the court relies refers to the role performed by excess amounts of the substance that serves the role of the surfactant in the claimed composition. The quoted language indicates that the composition of the invention must have at least three components in addition to the cyclosporin, as required by claim 81. In addition, it contemplates that the substance that serves as the surfactant may also serve as part of either the hydrophilic or the lipophilic component. The quoted language therefore makes clear that the composition may not consist of only two components in addition to the cyclosporin, as would be the case if one ingredient served as both the surfactant and the lipophilic component in the composition. However, the quoted language does not address the case presented by Abbott’s composition, which contains three components in addition to the cyclosporin, and in which a hydrophilic surfactant serves as the surfactant, while Span 80 serves the function of the lipophilic component (dissolving and carrying the cyclosporin). Thus, because in Abbott’s composition Span 80 does not serve as the surfactant referred to in claim 81, the quoted language from the specification does not apply to Abbott’s composition. For that reason, I agree with Novartis that, where another substance serves as the hydrophilic surfactant, the specification does not disclaim the use of a lipophilic surfactant such as Span 80 as the sole component of the lipophilic component of the claimed invention. I therefore do not find a disclaimer of subject matter in the specification. A fortiori, I do not find a specific exclusion of subject matter for purposes of the doctrine of equivalents.

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Jul 06, 2004

SEARFOSS v. PIONEER

SEARFOSS v. PIONEER CONSOLIDATED CORPORATION (Fed. Cir. June 6, 2004)

Searfoss appealed the district court's claim construction and resulting summary judgment of non-infringement of its patented truck bed covers. (U.S. Patent 5,031,955).

Because a finding of infringement under the doctrine of equivalents would vitiate the requirement of a direct connection through an actuation means, no reasonable jury could find that the accused device is insubstantially different than the claimed invention. Summary judgment of non-infringement is thus appropriate.

Because the district court correctly construed the disputed claim terms of the ’955 patent and thus Pioneer did not infringe claim 3 under the doctrine of equivalents, the district court’s entry of summary judgment on non-infringement is AFFIRMED

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TypeRight Keyboard v. Microsoft

TYPERIGHT KEYBOARD CORPORATION v. MICROSOFT CORPORATION (Fed. Cir. June 6, 2004).

Plaintiff TypeRight appealed the district court's summary judgment based on invalidity of its patented ergonomic keyboards. (U.S. Patent 5,372,441 and 5,503,484). Additionally, Microsoft cross-appealed the district court's dismissal (without prejudice) of its claims for non-infringement.

First, the court dismissed the cross-appeal for lack of jurisdiction.

A party that is not adversely affected by a judgment lacks standing to appeal. . . . Because Microsoft’s rights under the judgment of invalidity are actually broader than its rights would be under a judgment of non-infringement, Microsoft has not been adversely affected by the district court’s judgment. Because there is no jurisdiction for the cross-appeal, we dismiss the cross-appeal

Next, the appellate panel reversed the finding of invalidity and remanded the case.

Summary judgment should not be denied simply because the opposing party asserts that the movant’s witnesses are not to be believed. However, summary judgment is not appropriate where the opposing party offers specific facts that call into question the credibility of the movant’s witnesses.

Here, TypeRight pointed to specific facts that tend to discredit the testimony of [Microsoft's witnesses]. These facts create a genuine issue as to the credibility of Microsoft’s witnesses. Thus, while the evidence is sufficient to support a jury finding that the [] document is prior art, a reasonable jury could ultimately conclude otherwise. In such circumstances, “[t]he court may not assess the credibility of testimony when granting summary judgment.”

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Jun 30, 2004

TI Group Automotive Systems v. VDO

TI Group Automotive Systems v. VDO (Fed. Cir. June 30, 2004) [PDF].

TI Group is an automotive supplier that makes fuel tanks, fuel pump assemblies, and complete fuel tank systems. (U.S. Patent 4,860,714). TI Group has sold over thirty million fuel pump assemblies that embody the ’714 patent. VDO began selling an assembly that "were essentially drop-in replacements."

After a jury verdict of willful infringement, the district court granted a JMOL in VDO's favor based on non-infringement but denied VDO's JMOL motion for invalidity.

Because we affirm some of the district court’s claim constructions, and because as to those limitations TI Group points to no evidence supporting the jury’s finding of infringement, we affirm the district court’s grant of VDO’s JMOL motion with respect to infringement. However, because we have broadened a number of the district court’s claim constructions, thus affecting the invalidity analysis, we vacate the district court’s denial of VDO’s JMOL motion with respect to invalidity and remand that issue for further proceedings consistent with this opinion.

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Competitive Tech. v. Fujitsu: No Jurisdiction for Plasma Screen Appeal

COMPETITIVE TECHNOLOGIES, INC., and UNIVERSITY OF ILLINOIS v. FUJITSU LIMITED and FUJITSU HITACHI PLASMA DISPLAY LIMITED (Fed. Cir. June 30, 2004).

In a patent infringement suit against Fujitsu over plasma screen technologies, the University of Illinois sought to have some of Fujitsu's counterclaims dismissed on Eleventh Amendment sovereign immunity grounds. (U.S. Patent 4,866,349 and 5,081,400). The Northern District of California court denied the University's motion to dismiss the claims. U of I appealed.

Without reaching a decision on the merits, the Federal Circuit (DYK, MAYER, GAJARSA) dismissed the University's appeal for lack of appellate jurisdiction.

The judgment of the district court is not final under 28 U.S.C. § 1291, and the district court has not issued the certificate required by either Federal Rule of Civil Procedure 54(b) or 28 U.S.C. § 1292(b).

The appellate panel found that the district court's decision on the issue of sovereign immunity did not “conclusively determine” that question. Thus, the case did not fall under the limited Cohen exception that could have created a jurisdictional basis.

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Jun 28, 2004

Patent Infringement: No summary judgment of anticipation based on prepared model

NYSTROM v. TREX Co. (Fed. Cir. June 28, 2004).

In an appeal of a summary judgment in a patent infringement case involving specially manufactured boards for decking, the Federal Circuit reversed and remanded. (US Patent 5,474,831).

Because the district court erred in its constructions of the claim terms “board,” “manufactured to have,” and “convex top surface,” the district court’s grant of summary judgment of non-infringement of claims 1-15 of the ’831 patent is reversed.

The panel also reversed the district court's judgment of invalidity.

The district court’s acceptance of TREX’s invalidity arguments based on models made from drawings contained in the Zagelmeyer patent was incorrect. The basis of the district court’s summary judgment of invalidity was a model that TREX developed based on that reference, and not on drawing dimensions or a written disclosure of dimensions contained directly in the patent itself. Under the principles set forth in our prior cases, the speculative modeling premised on unstated assumptions in prior art patent drawings cannot be the basis for challenging the validity of claims reciting specific dimensions not disclosed directly in such prior art. Thus, we conclude that the district court erred in granting summary judgment of invalidity based on TREX’s models.

In dissent, Judge Gajarsa found that the term "board" should be limited to wooden boards.

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Jun 25, 2004

No trademark for "Patents.com"

IN RE OPPEDAHL & LARSON LLP (Fed. Cir. June 25, 2004).

Oppedahl & Larson is a small Colorado firm that maintains an expansive website at www.patents.com. The Federal Circuit has affirmed the Trademark Trial and Appeal Board's (TTAB) refusal to register the mark "patents.com" to the firm. The court found that the proposed mark is "merely descriptive" and thus not eligible for trademark protection.

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Hockerson-Halberstadt v. JSP and FUBU

Hockerson-Halberstadt, Inc. v. JSP Footware, Inc. and FUBU The Collection (Fed. Cir. June 23, 2004) (not citable as precedent)

(RADER) The appellate court reversed a summary judgement against the patentee, holding that the plaintiff had met its section 287 notice obligation by sending a letter to a third party who was thought to control manufacture of the patented stabilized athletic shoes. (U.S. Patent 4,322,896).

In dissent, MICHEL argued that the section 287 notice requirement should not be satisfied by giving notice to a third party that has no corporate relationship with the defendant except for a trademark license.

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Jun 17, 2004

Linear Technology v. Impala Linear (Patent Claim Construction)

Linear Technology Corporation v. Impala Linear Corp., Toyoda Automatic Loom Works, Maxim Integrated Protduct, Unitrode Corp., and Ronald Vinsant (Fed. Cir. June 17, 2004).

After losing a summary judgment in an infringement suit, Linear mounted this appeal based on claim construction and other errors. The technology at suit related to voltage regulators designed to provide constant voltage output from a fluctuating input. (U.S. Patent 5,481,178).

Because the district court erred in construing the “circuit,” “vary the duty cycle,” and “simultaneously off” claim limitations of the ’178 patent, we vacate the judgment of non-infringement and remand for further consideration. We further vacate the district court’s summary judgment of no contributory infringement or inducement of the current reversal method claims of the ’178 patent, because genuine issues of material fact have been raised concerning Maxim’s contributory infringement or inducement. Because the district court did not abuse its discretion on Maxim’s cross-appeal in denying Maxim’s motion for summary judgment that Vinsant was a joint inventor of the ’178 patent, we affirm.

The appellate panel held that the district court had improperly found that the term “circuit” was a means-plus-function limitation and that the district court had failed to apply the “rebuttable presumption that § 112 6 does not apply.”

We hold that because the term “circuit” is used in each of the disputed limitations of claims 1, 44, 55, and 57 of the ’178 patent with a recitation of the respective circuit’s operation in sufficient detail to suggest structure to persons of ordinary skill in the art, the “circuit” and “circuitry” limitations of such claims are not means-plus-function limitations subject to 35 U.S.C. § 112 6. The district court’s holding to the contrary was an error of law.

The appellate panel also found error in the district court’s exclusion of PWM circuits from other means language in the claims.

Linear cites technical textbooks and electronic parts catalogs indicating that PWM circuits are well-known circuit structures to persons of skill in the art. Thus, we conclude that the district court erred in excluding PWM circuits.

…

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Jun 11, 2004

In Re Jack Richard Simpson

In Re Jack Richard Simpson (Fed. Cir. June 9, 2004) (not citable as precedent).

In an appeal from the Board of Patent Appeals and Interferences ("Board") for a pending patent application, the Court affirmed the Board's rejection of Simpson's claims as anticipated by U.S. Patent 5,161,442 under 35 U.S.C. 102(b). (The application involved technology for cutting cardboard.) Although not explicitly described in the prior art, the Court found anticipation because the reference was "inherently 'capable' of performing the functions claimed by Simpson."

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University of California v. Actagro (Preliminary Injunction Vacated)

The Regents of the University of California and Biagro Western Sales, Inc v. Actagro, LLC (Fed. Cir. June 9, 2004) (not citable as precedent).

In an infringement suit involving phosphorous fertilizer, the Federal Circuit panel vacated a preliminary injunction against Defendant Actagro because Actagro raised "a substantial question as to the validity of the '200 patent." (U.S. Patent 5,514,200).

Given the evidence offered by Actagro, which on its face suggests that the SSP reference is a concentrated phosphorus fertilizer as contemplated by the claims, we find that Actagro has raised a substantial question as to the validity of the '200 patent. For that reason, we must conclude that the first prerequisite for entry of a preliminary injunction is lacking.

Posted by Dennis Crouch | Permalink

Jun 10, 2004

Watson v. H.J. Heinz Co.

Richard Watson v. H.J. Heinz Co. (Fed. Cir. June 8, 2004) (nonprecedential opinion)

In this trade secret case, the appellate panel held that Watson had no legal standing to sue Heinz for allegedly stealing his "trap cap" design for squeeze bottles of ketchup. Watson had filed for bankruptcy and not listed any trade secrets as assets. The court found that any property rights in the trade secret passed to the bankruptcy estate and no longer belong to Watson.

Posted by Dennis Crouch | Permalink

Jun 09, 2004

Animatics v. Quicksilver Controls

Animatics Corp. v. Quicksilver Controls, Inc. and Donald P. Labriola II (Fed. Cir. June 8, 2004) (nonprecedential opinion)

After a hung jury could not decide the issue of infringement, the judge granted a JMOL of infringement as to some claims and noninfringement/invalidity as to others. The Federal Circuit affirmed in part, vacated in part, and remanded for further findings.

We agree with Quicksilver's contention that the district court's reliance on claim differentiation was legal error. Claim differentiation is a judicial doctrine that cannot be used to override statute.

Posted by Dennis Crouch | Permalink

Jun 08, 2004

Shimano v. SRAM

Shimano has requested an inter partes examination of SRAM's patent 6,520,297, Title: Cable feed for a mechanical ball bearing disc brake.

Posted by Dennis Crouch | Permalink

Metabolite Labs. v. LabCorp

Metabolite Laboratories, Inc. and Competitive Technologies, Inc. v. Laboratory Corporation of America Holdings (doing business as LabCorp) (Fed. Cir. June 8, 2004)

The Federal Circuit (J. Rader) affirmed the jury verdict of indirect infringement and breach of contract, and affirmed the district court's award of over $8 million in damages to Metabolite (including damages for willfulness).

As expected, the appellate court ruled that the same claim construction should be used for damage calculations as is used for infringement and validity analysis.

This court declines the invitation to apply a different claim construction for computation of damages than for infringement liability.

Additionally, the court refused to vacate the willfullness damages even though the district court did not examine any of the Read factors in its decision.

That the district court did not explicitly set forth its rationale for awarding Metabolite enhanced damages based on LabCorp’s willful indirect infringement is not fatal to its decision.... The district court’s failure to discuss the Read factors, although contrary to this court’s strong preference for the enumerated bases underlying its decision, in this case was at most harmless error.

Finally, the Appellate Panel held that no justification for a permanent injunction is required once infringement is found.

[T]he district court properly granted the injunction because LabCorp was found to infringe. See W.L. Gore & Assocs., Inc. v. Garlock, Inc., 842 F.2d 1275, 1281 (Fed. Cir. 1988) (“[A]n injunction should issue once infringement has been established unless there is a sufficient reason for denying it.”).

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Holiday Matinee v. Rambus

Holiday Matinee, Inc. v. Rambus, Inc., No. H026142 (Cal. App. May 27, 2004)

In a consumer class action for alleged anticompetitive conduct in connection with patents on computer memory chip technology, the California State Court held that the complaint was demurrable because the Federal Courts have exclusive jurisdiction over patent matters.

Posted by Dennis Crouch | Permalink

Jun 07, 2004

W.E. Hall v. Atlanta Corrugating

W.E. Hall Company, Inc. v. Atlanta Corrugating, LLC (Fed. Cir. June 7, 2004)

In a patent infringement suit, the Federal Circuit affirmed the lower court's claim construction and noninfringement summary judgment. (U.S. Patent 4,838,317, on a Hydraulically Efficient Ribbed Pipe)

Appellant argued that ambiguity in the written description and prosecution history warranted a special meaning for several contested terms. The court disagreed:

Where, as here, the written description and prosecution history are ambiguous as to whether the patentee used the claim terms inconsistent with their ordinary and customary meanings, it is the ordinary and customary meanings that the terms obtain.

Posted by Dennis Crouch | Permalink

Jun 02, 2004

Honeywell v. Hamilton Sundstrand

Honeywell International, Inc. (formerly known as AlliedSignal Inc.) v. Hamilton Sundstrand Corp. (formerly known as Sundstrand Corp.) (Fed. Cir. June 2, 2004) (en banc)

During prosecution, Honeywell had cancelled its broad independent claim and rewritten dependent claims in independent form. (U.S. Patent No. 4,380,893). The jury found that the patents in suit were valid and, although not literally infringed, infringed under the doctrine of equivalents. The district court entered judgment against Sundstrand.

On appeal, the Court extended Festo in holding "that the rewriting of dependent claims into independent form coupled with the cancellation of the original independent claims creates a presumption of prosecution history estoppel." The case was remanded for a determination as to whether the patentee can rebut the presumption of surrender under Festo.

In dissent, J. Newman argued that the holding will lead applicants to file more independent claims and fewer dependent claims -- thus complicating the job of the patent office.

Hamilton Sundstrand is a United Technologies Corporation (UTC).

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Cordis v. Boston Scientific

Cordis Corp. v. Boston Scientific Corp. and SciMed Life Systems, Inc. (Fed. Cir. May 28, 2004) (Unpublished Opinion)

The appellate panel affirmed the lower court's denial of Cordis's motion for a preliminary injunction.

The most interesting aspect of the opinion involves the public interest component of the PI analysis. Historically, courts have found that the public interest "lies in upholding the the exclusive rights of a patentee." See, Pfaff v. Wells, 525 U.S. 55. In this case, however, the Court held that the public interest swings the other direction:

for good reason, courts have refused to permanently enjoin activities that would injure the public health.... In this case, a strong public interest supports a broad choice of drug-eluting stents, even though no published study proves the superiority of either ... stent.

Read more about the Cordis lawsuits here.

Posted by Dennis Crouch | Permalink

May 28, 2004

Jacobs v. Nintendo

Jacobs v. Nintendo of America, Inc. (Fed. Cir. May 28, 2004).

Jacobs owns a patent on a tilt sensitive controller. (U.S. Patent No. 5,059,958). In a prior suit over the same technology, Jacobs settled with Analog. Under the terms of the settlement agreement, Analog was given a full license to practice the patented technology.

In the present case, Jacobs sued Nintendo, asserting that Nintendo's "Kirby Tilt 'n Tumble" for Game Boy. Nintendo responded, and the lower court agreed, that Nintendo's actions fell under the settlement agreement, since the accelerometers for the game were purchased from Analog.

On appeal, the Federal Circuit (J. Bryson) affirmed the lower court's dismissal on summary judgment.

We agree with the district court that the clause granting Analog the right to sell its accelerometers for use in tilt-sensitive control boxes barred Jacobs from interfering with that right by prohibiting Analog’s customers from using the accelerometers for that authorized purpose by making, using, and selling control boxes incorporating Analog’s devices. That interpretation is in accordance with the basic contract law principle that a party may not assign a right, receive consideration for it, and then take steps that would render the right commercially worthless.

Additionally, the Appellate Panel held that the "noninfringing use" doctrine did not apply.

The “noninfringing use” doctrine applies when a patentee or its licensee sells an article and the question is whether the sale carries with it a license to engage in conduct that would infringe the patent owner’s rights. In that setting, absent an express agreement between the parties, determining whether the sale conveys with it the implied right to use the article in an infringing manner may depend on whether there is any noninfringing use for the article. If there is no noninfringing use, it may be reasonable to infer that there has been “a relinquishment of the patent monopoly with respect to the article sold.” United States v. Univis Lens Co., 316 U.S. 241, 249 (1942) ... This case is quite different ... because the [settlement] agreement must be understood to authorize Analog to sell its accelerometers for [otherwise infringing] uses.

Posted by Dennis Crouch | Permalink

May 25, 2004

Kinze v. Case (Attorney Disqualification)

Kinzenbaw and Kinze Manufacturing v. Case Corporation and New Holland (Northern District of Iowa, May 20, 2004)

In a patent infringement suit over a seed planter, the Iowa District Court refused to disqualify Plaintiff Kinze's attorneys, Perkins Coie, even though Perkins also represented Defendant Case in other matters. Perkins' work for Case had not involved patent matters.

Kinze's original attorneys had been disqualified after working on patent matters for both Kinze and Case.

Posted by Dennis Crouch | Permalink

May 19, 2004

Knoll v. Teva (Vicoprofen®)

Knoll Pharmaceutical Co. v. Teva Pharmaceuticals USA, Inc. (Fed. Cir. May 19, 2004).

The Federal Circuit reversed and remanded the N.D. Ill. district court judgment of invalidity. (U.S. Patent 4,587,252). The patent covers a method for treating pain with hydrocodone and ibuprofen (an NSAID) and is sold as Vicoprofen®.

In reversing the district court's obviousness finding, the appellate panel found that:

Although the prior art appears to suggest combining an opioid, such as hydrocodone, with various NSAIDs, . . . [t]here appears to be no record of evidence of prior art teaching or suggesting the enhanced biomedical effect of the combination of hydrocodone and ibuprofen.

Additionally, the district court excluded some evidence of unexpected results because those results were discovered after the patent had issued. In disagreement, the panel would allow such evidence:

Evidence developed after the patent grant is not excluded from consideration, for understanding of the full range of an invention is not always achieved at the time of filing the patent application. It is not improper to obtain additional support consistent with the patented invention, to respond to litigation attacks on validity.

The inherent contradiction of this opinion: Obviousness is judged at the time of the invention, but this case allows evidence that was developed after the invention to be used in determining obviousness.

Posted by Dennis Crouch | Permalink

May 13, 2004

In re American Academy of Science Tech Center

In re American Academy of Science Tech Center (Fed. Cir. May 13, 2004)

The Federal Circuit affirmed the Patent Board's rejection of several claims during reexamination.

The patent claims a priority date back to 1982 and describes distributing processing functionality among several computers:

user applications are run on the user stations, while the database resides on a dedicated database computer. Several user stations are networked to the database computer so that a user application running on a user station can store data to and retrieve data from the database residing on the database computer. The patent describes using a “data base simulator” to “enable[ ] an application program . . . at the user station to call for storage or retrieval of data from the data center as though it were calling for data from a data base resident at the user station . . . .”

The Federal Circuit agreed that the broadest reasonable construction of the claim language allows prior art to read on the claims. Thus, the claims were properly held invalid.

Posted by Dennis Crouch | Permalink

Microchip Technology v. Philips

Microchip Technology v. U.S. Philips and Philips Electronics N.A. (Fed. Cir. May 13, 2004)

Philips owns patents relating to a two-wire bus for communicating between integrated circuits (I2C). Microchip asserted that it did not infringe and that it was a licensee (by succession). The question before the Court was who determines whether there is an obligation to arbitrate.

Although the Federal Circuit generally follows local circuit law regarding non-patent issues, in this case the Court disagreed with prior 9th Circuit holdings. Instead, the Court held that under Supreme Court case law obligation to arbitrate is a threshold matter for the district court to determine. Thus, the Federal Circuit remanded for the District Court to determine whether Microchip was a successor party to the 1983 agreement before any issues may be referred to arbitration.

The appellate panel also found that the arbitration clause was not expired:

It is clear on the face of the 1983 agreement’s arbitration clause that the obligation to arbitrate survives expiration of the agreement’s other provisions. The arbitration clause specifically provides that “[a]ll disputes arising out of or in connection with the interpretation or execution of this Agreement during its life or thereafter” are subject to arbitration.

Appellate Jurisdiction: The Court also held that an order compelling arbitration is appealable:

An order compelling arbitration is in effect a mandatory injunction. Denial of a mandatory injunction is ordinarily appealable under section 1292(a)(1). (Citations omitted)

More info about the I2C technology is here:

Philips was the inventor of the Inter-IC or I²C-bus nearly 20 years ago, and it is now firmly established as the worldwide de-facto solution for embedded applications. It is used extensively in a variety of microcontroller-based professional, consumer and telecommunications applications as a control, diagnostic and power management bus. As a two-wire serial bus, its inherently simple operation was crucial to its emergence as the worldwide de-facto standard.

Posted by Dennis Crouch | Permalink

In re John Ngai and David Lin (RNA Amplification)

In re John Ngai and David Lin (Fed. Cir. May 13, 2004)

Ngai invented a new method for amplifying and normalizing RNA and submitted a patent application for his invention.

The Patent Board rejected Claim 19, which was drawn to a kit with printed instructions for performing the method. The Federal Circuit affirmed the Patent Board’s rejection of the claim.

All that the printed matter does is teach a new use for an existing product. As the Gulack court pointed out, “[w]here the printed matter is not functionally related to the substrate, the printed matter will not distinguish the invention from the prior art in terms of patentability.” Id. If we were to adopt Ngai’s position, anyone could continue patenting a product indefinitely provided that they add a new instruction sheet to the product. This was not envisioned by Gulack. Ngai is entitled to patent his invention of a new RNA extraction method, and the claims covering that invention were properly allowed. He is not, however, entitled to patent a known product by simply attaching a set of instructions to that product.

Posted by Dennis Crouch | Permalink

May 12, 2004

Medtronic Vascular v. Cordis

Medtronic Vascular, Inc. v. CORDIS Corp. (3rd Cir. April 30, 2004)

Medtronic AVE alleged that Cordis infringed its coronary stent patents. In response, Cordis asserted that it held a license to the patents under a Settlement and License Agreement that it entered into with the parent corporation of Medtronic AVE to settle prior litigation.

Although the Agreement included an arbitration provision, the District Court held that the dispute was not arbitrable, and enjoined arbitration.

The 3rd Circuit panel vacated and remanded, finding that the the arbitration clause was applicable under New York law.

Posted by Dennis Crouch | Permalink

May 10, 2004

Intirtool v. Texar (Fed. Cir. 2004)

Intirtool, Ltd. (MASS-TEX) v. Texar Corp. (ToolPro) (Fed. Cir. May 10, 2004).

In this patent infringement case, the district court found that Intirtool’s patent was invalid for failure to satisfy the written description requirement. (U.S. Patent 5,022,253) Additionally, the district court concluded that damages accrued prior filing the lawsuit were barred by laches. The Federal Circuit reversed these rulings for either clear error or abuse of discretion.

The first dispute revolved around whether the preamble:

hand-held punch pliers for simultaneously punching and connecting overlapping sheet metal

restricted the claims to pliers that have a connecting functionality.

The Federal Circuit held that the preamble was not limiting in this case because the body of the claim was described in such exacting structural detail that deletion of the preamble would not affect the claim. (NOTE: The body of claim 1 is quite large for this type of technology, listing 60+ lines in the patent).

In terms of inequitable conduct and laches,

the district court based its conclusion that Intirtool had engaged in inequitable conduct on its view that Intirtool had, during the prosecution of the ’253 patent, “repeatedly stated, and indeed stressed, that the described tool simultaneously punched holes and connected ceiling grids, knowing that this assertion was false.”

The Federal Circuit again disagreed with the district court – finding that the “connecting” references made by the patentee were “merely preamble features of the invention.”

Posted by Dennis Crouch | Permalink

Housey v. Astrazeneca (Fed. Cir. 2004)

Housey Pharmaceuticals, Inc. v. Astrazeneca UK Ltd. & Bristol-Myers Squibb & Merck, et al.(Fed. Cir. May 7, 2004).

In an infringement suit concerning Housey's assay method patent, the Federal Circuit held that the definition of an "inhibitor or activator" included substances that both directly and indirectly affect a protein of interest. (U.S. Patent 5,688,655, et al.) The Court arrived at its decision based on the plain meaning of the terms (from dictionaries) and because the patent did not "clearly disavow this broad plain meaning." Invalidity affirmed.

In dissent, Judge Newman argued that

My colleagues' approach to construction is based on confusing recent pronouncements of panels of this court, contravening earlier statements of precedent, thus adding to the confusion. . . . It is curious indeed to announce a "heavy presumption" that the meaning of a term in a patent claim is unencumbered by the specification, and to place a "heavy burden" on overcoming that presumption. . . . The written description is not an also-ran in claim construction, as the panel states; it is the primary resource in understanding the claims.

Posted by Dennis Crouch | Permalink

May 05, 2004

Elan v. Andrx Pharmaceuticals (Fed. Cir. 2004) (Aleve®)

Elan Corp. v. Andrx Pharmaceuticals, Inc. (Fed. Cir. May 5, 2004)

In this case, the Federal Circuit determined that there was no on-sale-bar, thus reversing the district court’s finding of invalidity.

More than one year before filing for a patent, Elan made several offers to enter into a license under a patent for future sales of their invention “when and if it had been developed.”

The court found that this was not an offer to sell but rather a permissible offer to license because the communication was not a definite offer including material terms.

The letter . . . lacked any mention of quantities, time of delivery, place of delivery, or product specifications beyond the general statement that the potential product would be a 500 mg once-daily tablet containing naproxen. Moreover, the dollar amounts recited . . . are clearly not price terms for the sale of tablets, but rather the amount that Elan was requesting to form and continue a partnership with Lederle. Indeed, the letter explicitly refers to the total as a “licensing fee.”

Posted by Dennis Crouch | Permalink

May 04, 2004

Stevens v. Tamai (Fed. Cir. 2004)

Stevens v. Tamai (May 4, 2004) (Correction Tape Dispenser)

In an interference proceeding, The Federal Circuit reversed the Patent Board’s holding.

Tamai’s application was a continuation (A3) of a continuation (A2) of an original (A1). Unfortunately (for Tamai), he failed to properly submit a translation of A2 to the Board to prove the lineage. The Court found for Stevens because Tamai’s priority claim failed. The real lesson in this case is to follow the rules of the Patent Board. A timely authenticated translation may have won the case for Tamai.

Posted by Dennis Crouch | Permalink

Vanderlande Industries v. ITC (Fed. Cir. 2004)

Vanderlande Industries v. International Trade Commission

The Appellate Court affirmed the ITC's holding that Vanderlande unlawfully imported a sorting system. (U.S. Patent No. 5,127,510). Vanderlande was unable to show that the patent owners (Siemens/Rapistan) committed the first element of equitable estoppel:

(1) The patentee, who usually must have knowledge of the true facts, communicates something in a misleading way, wither by words, conduct or silance.

Thus, the court found no estoppel. Additionally, the ITC's claim construction was affirmed.

Posted by Dennis Crouch | Permalink

Apr 28, 2004

SmithKline Beecham v. Apotex
(Part IV)

In an updated concurrence, J. Gajarsa adds firepower to his disagreement with the newly defined experimental use exception:

According to the majority, SKB’s testing of PHC's performance as a human antidepressant was not necessary to reduce PHC to practice. The majority does not make clear, however, why testing a light pole’s performance at illumination under severe weather conditions was necessary to reduce the light pole to practice, Manville, why testing an all-weather activity mat’s performance in harsh weather was necessary to reduce the mat to practice, Seal-Flex, or why testing a floating dock’s performance in rough, choppy water was necessary to reduce the dock to practice, EZ-Dock.

In all four cases, the claims at issue were product claims that did not claim the tested features explicitly. In all four cases, the patentees possessed the claimed product in substantial enough form to test their products’ performance at their intended functions. The majority does not explain why only one of these four patentees had reduced its claimed invention to practice sufficiently to preclude the experimental use doctrine.

Read Part I, Part II, Part III, and part IV.

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SmithKline Beecham v. Apotex
(PART III)

SmithKline Beecham v. Apotex: The concurrence.

Judge Gajarsa filed a Concurrence in SKB based upon his sua sponte analysis of Section 101. SKB had argued that its claimed compound (PHC hemihydrate) had been seeded in the environment and, once seeded, will naturally contaminate any synthetically made PHC anhydrate.

J. Gajarsa agreed that the manufacture of PHC hemihydrate could be "a natural physical process" occurring "under normal climactic conditions and with no human intervention," and thus found that it was an unpatentable process of nature.

In short, patent claims drawn broadly enough to encompass products that spread, appear, and "reproduce" through natural processes cover subject matter unpatentable under Section 101--and are therefore invalid.

Finally, the Concurrence derided the Majority's approach, saying that it has created "unfortunate precedent that will complicate future considerations of the experimental use doctrine."

Read Part I, Part II, Part III, and part IV.

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Apr 25, 2004

Smithkline Beecham v. Apotex
[PART II]

This is a second installment the SKB v. Apotex case brief

Experimental use was a major issue in the case. According to the court, experimental use may only be used to negate a 102(b) public use if the purpose of the experimental use was to assist in designing or testing of a claimed feature. Thus, in SKB, the “clinical trials tested only the safety and efficacy of PHC hemihydrate as an antidepressant” and were not an experimental use of the chemical compound as claimed in claim 1.

One striking idea from the case is that experimental use is now analyzed on a claim-by-claim basis. Thus, the court found that the clinical trials “may serve to negate a public use bar with regard to the inventions claimed in the more specific claims of the ’723 patent.”

Rather than determining whether the invention was undergoing experimental use, courts must now determine whether an alleged experimental use negates a 102(b) public use for each claim individually.

Read Part I, Part II, Part III, and part IV.

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Apr 24, 2004

Smithkline Beecham v. Apotex (Paxil)

Smithkline Beecham Corp. (SKB) v. Apotex Corp. (Fed. Cir. 2004)

(Figure shows IR spectrum for Paxil)

Always controversial Judge Richard A. Posner of the 7th Circuit sat as the district judge in this case. His outcome was preserved on appeal, but only after two of his holdings were reversed. This is a very well written, interesting opinion by Judge Rader. If you only read one every three-months, this should be it.

Simplification: The case involved PHC anhydrates (without water) and PHC hemihydrates (some water). In the 70’s PHC anhydrates were invented in the UK. In 1984, SKB invented PHC hemihydrates and eventually patented a PHC hemihydrate compound. (U.S. Patent No. 4,721,723) In 1998, Apotex filed an ANDA to market a prior art PHC anhydrate.

The holding is simple: 1) SKB’s clinical trials that occurred more than one year prior to filing are a public use under §102(b). The clinical trials were not a form of experimental use because the trials were experiments of the medical usefulness of the claimed compound (a PHC hemihydrate) and did not reflect upon the structure or ability to enable the claimed compound. 2) There is no room for a policy-driven inquiry during claim construction. Posner erred in adding a “commercially significant” limitation into the compound claim.

The most interesting aspect of Posner’s opinion was left for another day as moot. In his opinion, Posner created a new equitable defense to infringement that would bar enforcement of a patent when the patentee’s own conduct significantly inhibits non-infringing practice of the prior art. In this case, Apotex’s ANDA request involved making a prior-art PHC anhydrate. SKB argued that after 1984, the environment became seeded with hemihydrate crystals, and that it was no longer possible for Apotex to make PHC anhydrate that would be free of infringing hemihydrate. Under Posner’s new defense SKB would be estopped from enforcing its patent because its conduct (manufacturing hemihydrates and seeding the environment) had effectively eliminated Apotex’s ability to practice the prior art.

There is much more to this opinion including a thought provoking concurrence by Judge Gajarsa.

Read Part II, Part III, and part IV.

Here is a link to Judge Posner's Opinion. (Thanks Howard Bashman)

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Apr 23, 2004

Scanner v. ICOS Vision Systems

Scanner Technologies Corp. v. ICOS Vision Systems Corp. (Fed. Cir. 2004)

(Figure shows lens, mirrors, camera, ect.)

In a standard claim construction case, the Federal Circuit vacated a grant of summary judgment in an infringement case involving technology for inspecting electronic components. (U.S. Patent No. 6,064,756 and 57). The lower court found that “comprising . . . an illuminating apparatus” was limited to a single apparatus, while the appellate court held that the phrase would include one or more.

Update: April 29, 2004. Although ICOS Vision Systems lost the appeal, their press release indicates that they may still have a good case.

Anton DeProft, president and chief executive officer of ICOS Vision Systems, commented, "We are disappointed with this decision, but note that the ruling was on a very narrow issue of claim construction, and involved a relatively limited number of systems we sold. We continue to believe that we do not infringe any valid patents of Scanner Technologies and intend to continue to vigorously defend our rights."

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Apr 22, 2004

GTE Mobilnet v. Cellexis

GTE Mobilnet v. Cellexis International (D. Mass, April 20, 2004)

In a 1996 settlement agreement, plaintiff had agreed not to sue GTE or its subsidiaries, joint ventures or affiliates over disputed patent rights. In March 2000, plaintiff sued Bell Atlantic Mobile for infringement. At the time of the suit, Bell Atlantic Mobile was not an affiliate of GTE. However, four months later, through a series of transactions and transformations, Bell Atlantic Mobile became "Cellco" and an affiliate of GTE. After a trial, the Jury decided that Bell Atlantic Mobile (now Cellco) was an affiliate under the settlement agreement. Thus, the plaintiffs case was dismissed.

Commentary: This case simply involved contract interpretation. Drafting the settlement agreement with more clarity up-front could have avoided this litigation and its associated costs.

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Apr 20, 2004

Fieldturf v. Triexe Management Group

Fieldturf Int'l., Inc. v. Triexe Mgmt. Grp., Inc. (N.D. Ill. 2004)

An interesting case is brewing in the Northern District of Illinois between Fieldturf International and Triexe Management Group (Sportexe) over synthetic turf technology. (e.g., U.S. Patent 6,338,885). Fieldturf alleges that Triexe infringed its patents, intentionally interfered with its prospective economic advantage and committed common law conversion by selling or offering to sell synthetic turf to the U Wisc, UC Berkeley, the Baltimore Ravens, and a fourth project in Ireland. Triexe has denied the material allegations and has asserted counterclaims.

Prior litigation between the parties has involved domain name disputes stemming from Triexe’s registration of the domain name fieldturf.net. In his decision, the ICANN arbitrator found that Triexe’s registration was confusing and done in bad faith. In addition, Fieldturf recently lost an appeal in another patent infringement case for lack of standing. (Stephen Nipper).

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Apr 19, 2004

Golden Blount v. Peterson

Golden Blount, Inc. v. Robert H. Peterson Co. (Fed. Cir. 2004).

In an infringement action over a patented fireplace burner assembly, the district court, after a bench trial, found for the plaintiff patent holder. (U.S. Patent 5,988,159). A Federal Circuit panel vacated the infringement holding:

Because the district court’s sparse opinion provides this court with only bald conclusions for review, we conclude that the district court’s judgment as to literal infringement, contributory infringement, induced infringement, and infringement under the doctrine of equivalents is insufficient under Rule 52(a).

Additionally, the appellate court upheld a finding of validity. (Apparently, bald conclusions of validity satisfy Rule 52(a) because of the accompanied presumption of validity). Finally, the court refused to hear an inequitable conduct charge that had not been raised below.

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Apr 13, 2004

Sierra Applied Sciences v. Advanced Energy Ind.

Sierra Applied Sciences, Inc. v. Advanced Energy Ind. (AEI) (Fed. Cir. 2004)

Sierra designed and tested a power supply that arguably infringes AEI's Patents. (E.g., U.S. Patent 6,001,224). Sierra filed a declaratory judgment action prior to putting its power supply on the market and conceded that it did not intend to sell the supply unless the Court determined invalidity or noninfringement in favor of Sierra. The court considered whether a sufficient case or controversy existed to support such a declaratory action.

AEI's counsel, at oral arguments, represented that AEI would not sue Sierra for its current in-house use (for design or testing) of its power supply technology. The Court found that these representations created an estoppel against AEI in future suits and thus eliminated any case or controversy for the associated actions. In reference to a second power supply technology being developed by Sierra, the Court ruled that Sierra's efforts at developing the device were not sufficiently far along "on the date of the complaint." Reversed-in-part, vacated-in-part, affirmed-in-part, and remanded.

Geof has more on the case.

Commentary: Declaratory judgments actions require action by both the defendant (e.g., threaten suit) and the plaintiff (e.g., arguably infringing activity) in order to be appropriate. It is interesting that the Court examined the plaintiff’s actions up to the date of filing the complaint (Sierra being far from completing its new product as of filing) but examined the defendant’s actions that occurred much later (counsel conceding at oral arguments that AEI will not file suit for in-house uses).

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Apr 09, 2004

Monsanto Co. v. Homan McFarling (Fed. Cir. 2004)

Monsanto Co. v. Homan McFarling

McFarling replanted some ROUNDUP READY(r) soybeans that he had saved from his prior year's crop in violation of the Technology Agreement that he signed as a condition of his purchase of the seeds from Monsanto. (U.S. Patents 5,633,435 and 5,352,605). On appeal from a summary judgment, McFarling argued that the Technology Agreement involved an unlawful misuse of Monsanto’s patents by restricting use of “god-made” second-generation seeds. The Court disagreed. Because the first-generation seeds (sold by Monsanto) were nearly identical copies to the second-generation seeds, the court found that the patent scope includes both generations. Thus, the Court rejected McFarling's appeal and held that the Technology Agreement did not impermissibly extend Monsanto's rights.

The Court vacated and remanded the district court's damages award under Missouri law as an "unenforceable and invalid penalty clause."

Andrew Hagen provides some anti-GMO comments and links. Canola Farmers may also be violating Monsanto's patents. Here is an older article on the Roundup Ready soybean controversy, and here is another. Andrew Raff provides further commentary.

Update: Farmers in Argentina are allowed to cull seeds for replanting new crops. Apparently there is also a large black-market for GM seeds. (Thanks to Carol Nottenburg for the link).

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Inland Steel Co. v. LTV Steel Co. (Fed. Cir. 2004)

Inland Steel Co. v. LTV Steel Co. and USX Corp.

The Court found that USX was a "prevailing party" on a claim before the district court, even though USX prevailed on the issue of invalidity in a different forum (a PTO reexamination). (U.S. Patents 4,421,574 and 4,483,723). Thus, USX may have a right to attorney fees and costs under 35 U.S.C. 285 and Rule 54(d) of the Federal Rules of Civil Procedure. The major indication of the status of prevailing party cited by the Court is that the case would have res judicata effect as to any claims brought against USX in the future with respect to the patent claims that were at issue in the district court case.

Reversed and remanded to determine whether the case is "exceptional" or if the court should exercise its discretion to allow or deny costs to the prevailing party.

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Apr 08, 2004

Phillips v. AWH Corp.

Phillips v. AWH Corp. (Fed. Cir. 2004)

In a case involving modular wall panels for prisons (U.S. Patent 4,677,798), the Federal Circuit interpreted the term "baffles" to structures oriented at angles other than 90 degrees. Although the ordinary meaning of the term ("something for deflecting, checking, or otherwise regulating flow") includes 90 degree orientations, the Court listed two reasons for abandoning the ordinary meaning. First, the only embodiment shows "baffles angled at other than 90 degrees." Next, the Court found that baffles angled at other than 90 degrees better realize the invention's purpose of providing impact or projectile resistance.

In dissent, Judge Dyk argued that 1) a patent describing only a single embodiment is limited to that embodiment, and 2) impact or projectile resistance was not the only objective listed in the patent and claims are not required to be capable of achieving all of the objectives of an invention.

===========================

NOTE: This case is scheduled for a rehearing en banc and will likely create dramatic changes to patent litigation procedures, just as Markman has done. Read more here.

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Apr 06, 2004

No Appeal for Halliburton

U.S. Supreme Court Will Not Listen to Halliburton Appeal

By David Ivanovich, Houston Chronicle Knight Ridder/Tribune Business News

The Supreme Court refused to hear Halliburton's appeal to a $101 million infringement judgment in favor of BJ services. The allegedly infringed patent covers technology for extracting oil and gas.

See the Federal Circuit's opinion.

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Norian v. Stryker (Fed. Cir.)

Norian v. Stryker

In the most interesting portion of the case, the Appellate Court found that the District Court erred in allowing the jury, while determining validity, to consider factual misstatements made by the patentee during prosecution. (Jury did not rule on inequitable conduct.) The Appellate Court did not overrule the verdict on that point, however, because no objection was made at trial.

The case was reversed and remanded on other grounds.

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Novartis Pharmaceuticals v. Eon Labs (Fed. Cir.)

Novartis Pharmaceuticals v. Eon Labs

Novartis patented a cyclosporin hydrosol (aqueous solution) and sued Eon for infringement. (U.S. Patent 5,389,382) Eon's cyclosporin, however, is suspended in ethanol rather than water. The infringement argument was that a Eon's drug formed a hydrosol when ingested by a patient.

The court held that "hydrosol" as used in the patent is limited to an "aqueous medicinal preparations prepared outside the body," and thus, that Eon's formulation did not infrnge.

See Eon's press release.

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