In Hologic v. Minerva Surgical, the Federal Circuit held assignor estoppel barred the assignor from asserting invalidity of a patent in district court, but not the assignor relying on the Federal Circuit's affirmance of PTAB invalidating claims of another patent in an inter partes review (IPR).
See further details in the opinion. One detail caught my eye as a patent attorney, Judge Stoll questioning if it is time to revisit assignor estoppel en banc (entire panel) on the construction of the America Invents Act (AIA) due to the illogical regime being perpetuated.
In the opinion on page 30:
"In Arista, we held
that the judge-made doctrine of assignor estoppel does not
apply in the context of an inter partes review. In other
words, an assignor who sold his patent rights may file a
petition for IPR challenging the validity of that patent.
Arista Networks, Inc. v. Cisco System, Inc. At the same time, we continue to bar
assignors from challenging in district court the validity of
the patents they assigned. See, e.g., Mentor Graphics Corp.v. EVE-USA, Inc.
Our precedent thus presents an odd situation where an assignor can circumvent the doctrine of assignor estoppel by
attacking the validity of a patent claim in the Patent Office,
but cannot do the same in district court. Do the principles
underlying assignor estoppel—unfairness in allowing one
who profited from the sale of the patent to attack it—apply
in district court but not in Patent Office proceedings?
Should we change the application of the doctrine in district
court, or should we revisit our construction of the America
Invents Act and reevaluate our interpretation of the statute as prohibiting the doctrine of assignor estoppel?
Given the odd circumstance created in this case, I suggest that it is time for this court to consider en banc the
doctrine of assignor estoppel as it applies both in district
court and in the Patent Office.
We should seek to clarify
this odd and seemingly illogical regime in which an assignor cannot present any invalidity defenses in district
court but can present a limited set of invalidity grounds in
an IPR proceeding. A petitioner in an IPR proceeding may request to
cancel as unpatentable one or more claims of a patent, but
“only on a ground that could be raised under section 102 or
103 and only on the basis of prior art consisting of patents
or printed publications.” 35 U.S.C. § 311(b)."
Copyright © 2020 Robert Moll. All rights reserved.
Showing posts with label assignor estoppel. Show all posts
Showing posts with label assignor estoppel. Show all posts
Wednesday, April 29, 2020
Wednesday, November 21, 2018
CAFC - Arista Networks, Inc. v. Cisco Systems, Inc. - No Assignor Estoppel in Inter Partes Review
In Arista Networks v. Cisco Systems, the Federal Circuit held that assignor estoppel has no place in inter partes review (IPR).
As background, assignor estoppel prevents a party who assigns a patent to another from later challenging the validity of the assigned patent. Further, assignor estoppel prevents parties in privity with the assignor (e.g., a company founded by the assignor) from challenging validity. An IPR is a proceeding before the Patent Trial and Appeal Board for challenging the validity of any issued US patent.
Cisco had sued its competitor Arista for patent infringement of the claims of U.S. Patent No. 7,340,597 ("the '597 patent"), Method and Apparatus for Securing a Communications Device using a Logging Module, owned by Cisco. Arista petition for an IPR, and after instituting the IPR, the PTAB invalidated certain claims. Cisco argued assignor estoppel should prevent Arista challenging the validity in the IPR, because Dr. Cheriton the Arista co-founder had previously assigned the '597 patent to Cisco.
The Federal Circuit questioned did Congress intend for assignor estoppel to apply in IPR in the following manner:
"Cisco's primary argument in favor of applying assignor estoppel is that assignor estoppel is a well-established common-law doctrine that should be presumed to apply absent a statutory indication to the contrary. With this principle in mind, Cisco particularly takes issue with the Board's reasoning that Congress would have expressly provided for application of equitable defenses if it so desired.
There is some merit to Cisco's argument. In Westinghouse, the Court characterized assignor estoppel as "a rule well settled by 45 years of judicial consideration and conclusion" in the district and circuit courts, reaching back as early as 1880. Westinghouse, 266 U.S. at 349; see also Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249, 260 (1945) (Frankfurter, J., dissenting) ("The principle of fair dealing as between assignor and assignee of a patent whereby the assignor will not be allowed to say that what he sold as a patent was not a patent had been part of the fabric of our law throughout the life of this nation."). But, in Lear, Inc. v. Adkins, the Supreme Court appeared to cast some doubt on the doctrine's continued viability. 395 U.S. 653, 664-66 (1969). And although this court has held that the doctrine survived Lear, we did so recognizing that court decisions post-Lear "reveal[ed] some uncertainty about the continued vitality of the doctrine." Diamond Sci., 848 F.2d at 1223; see also id. ("Although Lear involved the licensing, rather than the assignment, of a patent, the opinion reviewed the history of `patent estoppel' in general, and indicated that the Court's previous decisions had sapped much of the vitality, if not the logic, from the assignment estoppel doctrine as well.").
With this history in mind, we recognize that "Congress is understood to legislate against a background of common-law adjudicatory principles." Astoria Fed. Sav. & Loan Ass'n v. Solimino, 501 U.S. 104, 108 (1991). "Thus, where a common-law principle is well established, . . . the courts may take it as given that Congress has legislated with an expectation that the principle will apply except `when a statutory purpose to the contrary is evident.'" Id. (quoting Isbrandtsen Co. v. Johnson, 343 U.S. 779, 783 (1952)); see also Impression Prods., Inc. v. Lexmark Int'l, Inc., 137 S.Ct. 1523, 1536 (2017). But see United States v. Craft, 535 U.S. 274, 288 (2002) ("The common-law rule was not so well established . . . that we must assume that Congress considered the impact of its enactment on the question now before us."). But even assuming that assignor estoppel could be considered such a well-established common law principle, we nonetheless conclude that, here, "a statutory purpose to the contrary is evident." Astoria, 501 U.S. at 108 (quoting Isbrandtsen, 343 U.S. at 783). In particular, we view § 311(a) as governing the question of whether Congress intended assignor estoppel to apply in the IPR context.13
Section 311(a) states, in relevant part: "(a) In General.—Subject to the provisions of this chapter, a person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent. . . ." § 311(a) (emphasis added).
Arista contends that § 311(a) unambiguously leaves no room for assignor estoppel in the IPR context, given that the statute allows any person "who is not the owner of a patent" to file an IPR.14 We agree. Where "the statutory language is plain, we must enforce it according to its terms." King v. Burwell, 135 S.Ct. 2480, 2489 (2015); see also Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 251 (2010). In our view, the plain language of this statutory provision is unambiguous.
Cisco contends that this statute does not directly speak to the question of assignor estoppel in IPRs. Instead, Cisco views § 311(a) as reflecting two principles: first, that an IPR must begin as an adversarial proceeding, rather than as a means for a patent owner to confirm the patentability of certain claims; and second, that there is no Article III-like standing requirement for filing an IPR. In our view, however, the statute, by its terms, does more—it delineates who may file an IPR petition. The plain language of § 311(a) demonstrates that an assignor, who is no longer the owner of a patent, may file an IPR petition as to that patent.
This conclusion is consistent with Congress's express incorporation of equitable doctrines in other related contexts. For example, a statute governing International Trade Commission investigations states that "[a]ll legal and equitable defenses may be presented in all cases." 19 U.S.C. § 1337(c); cf. 15 U.S.C. § 1069 (providing in the Lanham Act context that "[i]n all inter partes proceedings equitable principles of laches, estoppel, and acquiescence, where applicable may be considered and applied"). And although such express inclusion of equitable defenses in other contexts is not dispositive of the issue presented in this case, it is further evidence of congressional intent.
Finally, Cisco contends that allowing assignor estoppel in other forums, such as in the ITC and in district court, while not allowing it in the IPR context creates an inconsistency that invites forum shopping. We, however, do not view this as an inconsistency, but rather as an intentional congressional choice. Such a discrepancy between forums—one that follows from the language of the respective statutes—is consistent with the overarching goals of the IPR process that extend beyond the particular parties in a given patent dispute. See Cuozzo, 136 S. Ct. at 2144 ("[I]nter partes review helps protect the public's `paramount interest in seeing that patent monopolies . . . are kept within their legitimate scope.'" (quoting Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 816 (1945))). Moreover, any policy choices regarding forum shopping are better left to Congress than to this court. Cf. SAS Inst., 138 S. Ct. at 1358 ("Policy arguments are properly addressed to Congress, not this Court."); Click-to-Call Techs., LP v. Ingenio, Inc., 899 F.3d 1321, 1350 (Fed. Cir. 2018) (Taranto, J., concurring) ("If there turns out to be a problem in the statute's application according to its plain meaning, it is up to Congress to address the problem.").
In sum, we conclude that § 311(a), by allowing "a person who is not the owner of a patent" to file an IPR, unambiguously dictates that assignor estoppel has no place in IPR proceedings."
Copyright © 2018 Robert Moll. All rights reserved.
As background, assignor estoppel prevents a party who assigns a patent to another from later challenging the validity of the assigned patent. Further, assignor estoppel prevents parties in privity with the assignor (e.g., a company founded by the assignor) from challenging validity. An IPR is a proceeding before the Patent Trial and Appeal Board for challenging the validity of any issued US patent.
Cisco had sued its competitor Arista for patent infringement of the claims of U.S. Patent No. 7,340,597 ("the '597 patent"), Method and Apparatus for Securing a Communications Device using a Logging Module, owned by Cisco. Arista petition for an IPR, and after instituting the IPR, the PTAB invalidated certain claims. Cisco argued assignor estoppel should prevent Arista challenging the validity in the IPR, because Dr. Cheriton the Arista co-founder had previously assigned the '597 patent to Cisco.
The Federal Circuit questioned did Congress intend for assignor estoppel to apply in IPR in the following manner:
"Cisco's primary argument in favor of applying assignor estoppel is that assignor estoppel is a well-established common-law doctrine that should be presumed to apply absent a statutory indication to the contrary. With this principle in mind, Cisco particularly takes issue with the Board's reasoning that Congress would have expressly provided for application of equitable defenses if it so desired.
There is some merit to Cisco's argument. In Westinghouse, the Court characterized assignor estoppel as "a rule well settled by 45 years of judicial consideration and conclusion" in the district and circuit courts, reaching back as early as 1880. Westinghouse, 266 U.S. at 349; see also Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249, 260 (1945) (Frankfurter, J., dissenting) ("The principle of fair dealing as between assignor and assignee of a patent whereby the assignor will not be allowed to say that what he sold as a patent was not a patent had been part of the fabric of our law throughout the life of this nation."). But, in Lear, Inc. v. Adkins, the Supreme Court appeared to cast some doubt on the doctrine's continued viability. 395 U.S. 653, 664-66 (1969). And although this court has held that the doctrine survived Lear, we did so recognizing that court decisions post-Lear "reveal[ed] some uncertainty about the continued vitality of the doctrine." Diamond Sci., 848 F.2d at 1223; see also id. ("Although Lear involved the licensing, rather than the assignment, of a patent, the opinion reviewed the history of `patent estoppel' in general, and indicated that the Court's previous decisions had sapped much of the vitality, if not the logic, from the assignment estoppel doctrine as well.").
With this history in mind, we recognize that "Congress is understood to legislate against a background of common-law adjudicatory principles." Astoria Fed. Sav. & Loan Ass'n v. Solimino, 501 U.S. 104, 108 (1991). "Thus, where a common-law principle is well established, . . . the courts may take it as given that Congress has legislated with an expectation that the principle will apply except `when a statutory purpose to the contrary is evident.'" Id. (quoting Isbrandtsen Co. v. Johnson, 343 U.S. 779, 783 (1952)); see also Impression Prods., Inc. v. Lexmark Int'l, Inc., 137 S.Ct. 1523, 1536 (2017). But see United States v. Craft, 535 U.S. 274, 288 (2002) ("The common-law rule was not so well established . . . that we must assume that Congress considered the impact of its enactment on the question now before us."). But even assuming that assignor estoppel could be considered such a well-established common law principle, we nonetheless conclude that, here, "a statutory purpose to the contrary is evident." Astoria, 501 U.S. at 108 (quoting Isbrandtsen, 343 U.S. at 783). In particular, we view § 311(a) as governing the question of whether Congress intended assignor estoppel to apply in the IPR context.13
Section 311(a) states, in relevant part: "(a) In General.—Subject to the provisions of this chapter, a person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent. . . ." § 311(a) (emphasis added).
Arista contends that § 311(a) unambiguously leaves no room for assignor estoppel in the IPR context, given that the statute allows any person "who is not the owner of a patent" to file an IPR.14 We agree. Where "the statutory language is plain, we must enforce it according to its terms." King v. Burwell, 135 S.Ct. 2480, 2489 (2015); see also Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 251 (2010). In our view, the plain language of this statutory provision is unambiguous.
Cisco contends that this statute does not directly speak to the question of assignor estoppel in IPRs. Instead, Cisco views § 311(a) as reflecting two principles: first, that an IPR must begin as an adversarial proceeding, rather than as a means for a patent owner to confirm the patentability of certain claims; and second, that there is no Article III-like standing requirement for filing an IPR. In our view, however, the statute, by its terms, does more—it delineates who may file an IPR petition. The plain language of § 311(a) demonstrates that an assignor, who is no longer the owner of a patent, may file an IPR petition as to that patent.
This conclusion is consistent with Congress's express incorporation of equitable doctrines in other related contexts. For example, a statute governing International Trade Commission investigations states that "[a]ll legal and equitable defenses may be presented in all cases." 19 U.S.C. § 1337(c); cf. 15 U.S.C. § 1069 (providing in the Lanham Act context that "[i]n all inter partes proceedings equitable principles of laches, estoppel, and acquiescence, where applicable may be considered and applied"). And although such express inclusion of equitable defenses in other contexts is not dispositive of the issue presented in this case, it is further evidence of congressional intent.
Finally, Cisco contends that allowing assignor estoppel in other forums, such as in the ITC and in district court, while not allowing it in the IPR context creates an inconsistency that invites forum shopping. We, however, do not view this as an inconsistency, but rather as an intentional congressional choice. Such a discrepancy between forums—one that follows from the language of the respective statutes—is consistent with the overarching goals of the IPR process that extend beyond the particular parties in a given patent dispute. See Cuozzo, 136 S. Ct. at 2144 ("[I]nter partes review helps protect the public's `paramount interest in seeing that patent monopolies . . . are kept within their legitimate scope.'" (quoting Precision Instrument Mfg. Co. v. Auto. Maint. Mach. Co., 324 U.S. 806, 816 (1945))). Moreover, any policy choices regarding forum shopping are better left to Congress than to this court. Cf. SAS Inst., 138 S. Ct. at 1358 ("Policy arguments are properly addressed to Congress, not this Court."); Click-to-Call Techs., LP v. Ingenio, Inc., 899 F.3d 1321, 1350 (Fed. Cir. 2018) (Taranto, J., concurring) ("If there turns out to be a problem in the statute's application according to its plain meaning, it is up to Congress to address the problem.").
In sum, we conclude that § 311(a), by allowing "a person who is not the owner of a patent" to file an IPR, unambiguously dictates that assignor estoppel has no place in IPR proceedings."
Copyright © 2018 Robert Moll. All rights reserved.
Wednesday, August 2, 2017
PTAB - Athena Automation Ltd v. Husky Injection Molding System Ltd.- Assignor Estoppel Cannot Prevent Inter Partes Review
In Athena Automation Ltd v. Husky Injection Molding System Ltd., the Patent Trial and Appeal Board (PTAB) held that assignor estoppel does not prevent anyone who is not the patent owner from filing a petition for inter partes review to challenge patent validity.
With regard to assignor estoppel, PTAB reasoned:
"The only argument that Husky asserts in its Preliminary Response is that Athena is barred from bringing this Petition by the doctrine of assignor estoppel. Prelim. Resp. 1. Husky contends that Mr. Robert Schad, one of the named inventors of the ’536 Patent, is the founder, co-owner, President, Chief Executive Officer, and one of two directors on the Board of Directors of Petitioner Athena and is, therefore, in privity with Athena. Id. Thus, according to Husky, Athena is estopped from challenging the patentability of the ’536 Patent under the doctrine of assignor estoppel. Id.
The Federal Circuit has explained, [A]ssignor estoppel is an equitable doctrine that prohibits an assignor of a patent or patent application, or one in privity with him, from attacking the validity of that patent when he is sued for infringement by the assignee. . . . Assignor estoppel is thus a defense to certain claims of patent infringement. Semiconductor Energy Laboratory Co., Ltd. v. Nagata, 706 F.3d 1365, 1369 (Fed. Cir. 2013) (emphasis added) (citations omitted).
Under the AIA, “a person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent.” 35 U.S.C. § 311(a) (emphasis added). Consequently, under the statute, an assignor of a patent, who is no longer an owner of the patent at the time of filing, may file a petition requesting inter partes review. This statute presents a clear expression of Congress’s broad grant of the ability to challenge the patentability of patents through inter partes review.
In contrast to § 311(a), in International Trade Commission (ITC) investigations involving patent disputes brought under 19 U.S.C. § 1337(c), Congress provided explicitly that “[a]ll legal and equitable defenses may be presented in all cases.” From this statutory mandate, the ITC concluded that it must consider the defense of assignor estoppel in cases in which a patent owner may seek to have infringing goods excluded from the United States. See Lannom Mfg. Co. v. Int’l Trade Comm’n, 799 F.2d 1572, 1579 (Fed. Cir. 1986).
Congress issued no similar statutory mandate to the Office in connection with AIA post-grant reviews. Husky concedes that the Patent Office does not apply assignor estoppel in reexamination proceedings, but argues that assignor estoppel should be available to patent owners in inter partes review proceedings based on the adjudicative nature of the proceedings. Prelim. Resp. 15-25. However, none of Husky’s arguments addresses the language of § 311(a). Because we are not persuaded that assignor estoppel, an equitable doctrine, provides an exception to the statutory mandate that any person who is not the owner of a patent may file a petition for an inter partes review, we decline to deny this Petition based on the doctrine of assignor estoppel."
Copyright © 2017 Robert Moll. All rights reserved.
With regard to assignor estoppel, PTAB reasoned:
"The only argument that Husky asserts in its Preliminary Response is that Athena is barred from bringing this Petition by the doctrine of assignor estoppel. Prelim. Resp. 1. Husky contends that Mr. Robert Schad, one of the named inventors of the ’536 Patent, is the founder, co-owner, President, Chief Executive Officer, and one of two directors on the Board of Directors of Petitioner Athena and is, therefore, in privity with Athena. Id. Thus, according to Husky, Athena is estopped from challenging the patentability of the ’536 Patent under the doctrine of assignor estoppel. Id.
The Federal Circuit has explained, [A]ssignor estoppel is an equitable doctrine that prohibits an assignor of a patent or patent application, or one in privity with him, from attacking the validity of that patent when he is sued for infringement by the assignee. . . . Assignor estoppel is thus a defense to certain claims of patent infringement. Semiconductor Energy Laboratory Co., Ltd. v. Nagata, 706 F.3d 1365, 1369 (Fed. Cir. 2013) (emphasis added) (citations omitted).
Under the AIA, “a person who is not the owner of a patent may file with the Office a petition to institute an inter partes review of the patent.” 35 U.S.C. § 311(a) (emphasis added). Consequently, under the statute, an assignor of a patent, who is no longer an owner of the patent at the time of filing, may file a petition requesting inter partes review. This statute presents a clear expression of Congress’s broad grant of the ability to challenge the patentability of patents through inter partes review.
In contrast to § 311(a), in International Trade Commission (ITC) investigations involving patent disputes brought under 19 U.S.C. § 1337(c), Congress provided explicitly that “[a]ll legal and equitable defenses may be presented in all cases.” From this statutory mandate, the ITC concluded that it must consider the defense of assignor estoppel in cases in which a patent owner may seek to have infringing goods excluded from the United States. See Lannom Mfg. Co. v. Int’l Trade Comm’n, 799 F.2d 1572, 1579 (Fed. Cir. 1986).
Congress issued no similar statutory mandate to the Office in connection with AIA post-grant reviews. Husky concedes that the Patent Office does not apply assignor estoppel in reexamination proceedings, but argues that assignor estoppel should be available to patent owners in inter partes review proceedings based on the adjudicative nature of the proceedings. Prelim. Resp. 15-25. However, none of Husky’s arguments addresses the language of § 311(a). Because we are not persuaded that assignor estoppel, an equitable doctrine, provides an exception to the statutory mandate that any person who is not the owner of a patent may file a petition for an inter partes review, we decline to deny this Petition based on the doctrine of assignor estoppel."
Copyright © 2017 Robert Moll. All rights reserved.
Saturday, April 16, 2016
Professor Mark Lemley - Rethinking Assignor Estoppel - A Comment
In Rethinking Assignor Estoppel, Professor Mark Lemley argues assignor estoppel interferes with invalidating bad patents and employee mobility. I don't completely agree with Professor Lemley, but think this article is definitely worth reading.
Assignor estoppel bars an inventor who has assigned a patent from challenging its validity in a patent infringement suit. It is an issue an employee may face after filing a patent application(s) at a company and leaving for a competitor. The article argues that assignor estoppel should be granted less often in patent infringement cases.
As stated in the abstract, assignor estoppel may not make complete sense: "The Supreme Court and the Federal Circuit have repeatedly emphasized the public interest in testing the validity of patents, weeding out patents that should not have been issued. But there is one important group of people the law systematically prevents from challenging bad patents. Curiously, it is the very group patent law is supposed to support: inventors themselves. The century-old doctrine of assignor estoppel precludes inventors who file patent applications from later challenging the validity or enforceability of the patents they receive. The stated rationale for assignor estoppel is that it would be unfair to allow the inventor to benefit from obtaining a patent and later change her tune and attack the patent when it benefits her to do so. The Supreme Court has traditionally disfavored the doctrine, reading it narrowly. But the Federal Circuit has expanded the doctrine in a variety of dimensions, and applied it even when the benefit to the inventor is illusory. Further, the doctrine misunderstands the role of inventor-employees in the modern world.
More important, the expansive modern form of assignor estoppel interferes substantially with employee mobility. Inventors as a class are put under burdens that we apply to no other employee. If they start a company, or even go to work for an existing company in the same field, they will not be able to defend a patent suit from their old employer. The result is a sort of partial noncompete clause, one imposed without even the fiction of agreement and one that binds anyone the inventor comes in contact with after leaving the job. Abundant evidence suggests that noncompetes in general retard innovation and economic growth, and several states prohibit them outright, while all others limit them. But assignor estoppel is a federal law doctrine that overrides those state choices.
It is time to rethink the doctrine of assignor estoppel. I describe the doctrine, its rationale, and how it has expanded dramatically in the past 25 years. I argue that the doctrine is out of touch with the realities of both modern inventing and modern patent law, and that it interferes with both the invalidation of bad patents and the goal of employee mobility. Should the Supreme Court take up the doctrine, it is unlikely to survive in its current form. Rather, it should – and will – return to its much more limited roots."
Yes, assignor estoppel may give an overly generous shield against a challenge to patent validity. and why bar a challenge to patent validity when an inventor's awareness of the prior art is many times incomplete when signing the inventor declaration? However, the argument that assignor estoppel substantially interferes with employee mobility seems like a real stretch.
Copyright © 2016 Robert Moll. All rights reserved.
Assignor estoppel bars an inventor who has assigned a patent from challenging its validity in a patent infringement suit. It is an issue an employee may face after filing a patent application(s) at a company and leaving for a competitor. The article argues that assignor estoppel should be granted less often in patent infringement cases.
As stated in the abstract, assignor estoppel may not make complete sense: "The Supreme Court and the Federal Circuit have repeatedly emphasized the public interest in testing the validity of patents, weeding out patents that should not have been issued. But there is one important group of people the law systematically prevents from challenging bad patents. Curiously, it is the very group patent law is supposed to support: inventors themselves. The century-old doctrine of assignor estoppel precludes inventors who file patent applications from later challenging the validity or enforceability of the patents they receive. The stated rationale for assignor estoppel is that it would be unfair to allow the inventor to benefit from obtaining a patent and later change her tune and attack the patent when it benefits her to do so. The Supreme Court has traditionally disfavored the doctrine, reading it narrowly. But the Federal Circuit has expanded the doctrine in a variety of dimensions, and applied it even when the benefit to the inventor is illusory. Further, the doctrine misunderstands the role of inventor-employees in the modern world.
More important, the expansive modern form of assignor estoppel interferes substantially with employee mobility. Inventors as a class are put under burdens that we apply to no other employee. If they start a company, or even go to work for an existing company in the same field, they will not be able to defend a patent suit from their old employer. The result is a sort of partial noncompete clause, one imposed without even the fiction of agreement and one that binds anyone the inventor comes in contact with after leaving the job. Abundant evidence suggests that noncompetes in general retard innovation and economic growth, and several states prohibit them outright, while all others limit them. But assignor estoppel is a federal law doctrine that overrides those state choices.
It is time to rethink the doctrine of assignor estoppel. I describe the doctrine, its rationale, and how it has expanded dramatically in the past 25 years. I argue that the doctrine is out of touch with the realities of both modern inventing and modern patent law, and that it interferes with both the invalidation of bad patents and the goal of employee mobility. Should the Supreme Court take up the doctrine, it is unlikely to survive in its current form. Rather, it should – and will – return to its much more limited roots."
Yes, assignor estoppel may give an overly generous shield against a challenge to patent validity. and why bar a challenge to patent validity when an inventor's awareness of the prior art is many times incomplete when signing the inventor declaration? However, the argument that assignor estoppel substantially interferes with employee mobility seems like a real stretch.
Copyright © 2016 Robert Moll. All rights reserved.
Wednesday, March 12, 2014
Juniper Networks v. Palo Alto Network Patent Suit Ends in Mistrial
This week Juniper Networks failed to convince a jury that Palo Alto Network's PA-500, PA-2000, PA-4000 and PA-5000 Series Firewalls infringe US Patent No. 7,779,459, US Patent No. 7,650,634, and US Patent No. 7,302,700.
For details see Juniper Networks not giving up firewall patent fight vs. Palo Alto Networks and Juniper vs. Palo Alto Networks: Firewall court battle set to begin
For details see Juniper Networks not giving up firewall patent fight vs. Palo Alto Networks and Juniper vs. Palo Alto Networks: Firewall court battle set to begin
Juniper claims Palo Alto firewalls are based on intellectual property (IP) that Juniper obtained when it paid $4 billion for Netscreen in 2004. Juniper claims Palo Alto knew all about this infringement given Nir Zuk now at Palo Alto, developed the firewalls with Yuming Mao, when they worked at Netscreen.
Juniper says Mr. Zuk was a key developer of the IP in question, so it's curious he is not a named inventor of the '459 patent or the '700 patent given US law requires naming all inventors, but the articles don't say much more to support an improper inventorship defense. Juniper might argue assignor estoppel bars that invalidity challenge, but Palo Alto should be able to file a petition for inter partes review to sidestep assignor estoppel.
Juniper immediately promised to refile this lawsuit, but what's the likelihood the jury will rule in favor of Juniper after a mistrial? It reminds me of a boxer immediately claiming a punch that landed didn't hurt. The larger the protest, the more it hurt. Not to say we know the mistrial stung Juniper, but its insistence it wants to keep go another round may suggest a bluffing boxer on the way out.
Copyright © 2014 Robert Moll. All rights reserved.
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