In Application in Internet Time v. RPX, the Federal Circuit vacated inter partes review (IPR) decisions invalidating two US patents because the Patent Trial and Appeal Board (PTAB) applied an unduly restrictive test for determining whether an entity (i.e., a RPX member) is a real party in interest within the meaning of 35 U.S.C. § 315(b) and failed to consider the entire evidence in assessing whether § 315(b) barred institution of the IPRs filed by RPX.
The Federal Circuit stated the PTAB erred in not further investigating whether the RPX member was the real party in interest even though RPX had communications back and forth with the RPX member and received a large payment from the RPX member just before the IPR petitions were filed.
In short, a defendant in a patent infringement suit that waits more than one year after being served is time barred from filing an IPR. 35 U.S.C. § 315(b). Thus, a defendant that is a member of an organization that files IPR to avoid the one year time bar might expect that PTAB will permit discovery on the relationship between the organization and the defendant to see if the defendant is a real party in interest and the organization is its proxy. The discovery may encompass the communications and the funding of the organization. Once the facts are ascertained it may affect the final IPR decision. Thus, a defendant should expect that it needs to file an IPR petition within one year of being sued rather than rely on a third party organization which may be held to be its proxy.
Copyright © 2018 Robert Moll. All rights reserved.
Sunday, December 30, 2018
Friday, December 28, 2018
CAFC - In Re: Marco Guldenaar Holding B.V. - Dice Game Patent Ineligible under 35 USC 101
In Re: Marco Guldenaar Holding B.V., the Federal Circuit held a game with specially marked dice patent ineligible under 35 U.S.C. § 101.
Representative claim 1 recited:
A method of playing a dice game comprising:
providing a set of dice, the set of dice comprising a first die, a second die, and a third die, wherein only a single face of the first die has a first die marking, wherein only two faces of the second die have an identical second die marking, and wherein only three faces of the third die have an identical third die marking;
placing at least one wager on at least one of the following: that the first die marking on the first die will appear face up, that the second die marking on the second die will appear face up, that the third die marking on the third die will appear face up, or any combination thereof;
paying a payout amount if the at least one wager occurs.
The Federal Circuit held claim 1 was directed to the abstract idea of rules for playing a dice game. While a set of game rules may be patent-eligible if the claims contain an inventive concept sufficient to transform the abstract idea into a patent-eligible application, the claim recited placing a wager, rolling the dice, and paying a payout amount if at least one wagered outcome occurs none of which appellant disputes is conventional, either alone or in combination and special markings on the dice constituted printed matter outside the scope of § 101.
In an attempt to satisfy the second part of the Alice test, appellants argued the dice had markings on the die faces that were not conventional and their recitation in the claims amounted to "significantly more” than the abstract idea.
The Federal Circuit noted each die’s marking or lack of marking communicates information whether the player has won or lost a wager, similar to the markings on a typical die or a deck of cards. Further, the claim limitations are directed to information that is not functionally related to the substrate of the dice. In short, the markings constituted printed matter.
Just as the claimed steps of shuffling and dealing playing cards fell short in In re Smith, the Federal Circuit held the claims conventional and the markings insufficient to recite an inventive concept.
The Federal Circuit observed other games might be patent eligible, but I think games that are novel in the informational content may struggle to avoid that content being treated as "printed matter" and the game being held patent ineligible.
Copyright © 2018 Robert Moll. All rights reserved.
Representative claim 1 recited:
A method of playing a dice game comprising:
providing a set of dice, the set of dice comprising a first die, a second die, and a third die, wherein only a single face of the first die has a first die marking, wherein only two faces of the second die have an identical second die marking, and wherein only three faces of the third die have an identical third die marking;
placing at least one wager on at least one of the following: that the first die marking on the first die will appear face up, that the second die marking on the second die will appear face up, that the third die marking on the third die will appear face up, or any combination thereof;
paying a payout amount if the at least one wager occurs.
The Federal Circuit held claim 1 was directed to the abstract idea of rules for playing a dice game. While a set of game rules may be patent-eligible if the claims contain an inventive concept sufficient to transform the abstract idea into a patent-eligible application, the claim recited placing a wager, rolling the dice, and paying a payout amount if at least one wagered outcome occurs none of which appellant disputes is conventional, either alone or in combination and special markings on the dice constituted printed matter outside the scope of § 101.
In an attempt to satisfy the second part of the Alice test, appellants argued the dice had markings on the die faces that were not conventional and their recitation in the claims amounted to "significantly more” than the abstract idea.
The Federal Circuit noted each die’s marking or lack of marking communicates information whether the player has won or lost a wager, similar to the markings on a typical die or a deck of cards. Further, the claim limitations are directed to information that is not functionally related to the substrate of the dice. In short, the markings constituted printed matter.
Just as the claimed steps of shuffling and dealing playing cards fell short in In re Smith, the Federal Circuit held the claims conventional and the markings insufficient to recite an inventive concept.
The Federal Circuit observed other games might be patent eligible, but I think games that are novel in the informational content may struggle to avoid that content being treated as "printed matter" and the game being held patent ineligible.
Copyright © 2018 Robert Moll. All rights reserved.
Wednesday, December 26, 2018
Chien & Wu - Decoding Patentable Subject Matter
Colleen Chien & Jiun Ying Wu's Decoding Patentable Subject Matter (2018) quantifies 35 U.S.C. § 101 rejections across different technologies and shows how the Supreme Court's decisions in Alice and Mayo affected the patent eligibility of software and medical diagnostics in the USPTO.
From the Abstract:
"The Supreme Court’s patentable subject matter jurisprudence from 2011 to 2014 has raised significant policy concerns within the patent community. Prominent groups within the IP community and academia, and commentators to the 2017 USPTO Patentable Subject Matter report have called for an overhaul of the Supreme Court’s “two-step test.”
Based on an analysis of 4.4 million office actions mailed from 2008 through mid-July 2017 covering 2.2 million unique patent applications, this article uses a novel technology identification strategy and a differences-in-differences approach to document a spike in 101 rejections among select medical diagnostics and software/business method applications following the Alice and Mayo decisions.
Within impacted classes of TC 3600 (“36BM”), the 101 rejection rate grew from 25% to 81% in the month after the Alice decision, and has remained above 75% almost every month through the last month of available data (2/2017); among abandoned applications, the prevalence of 101 rejection subject matter rejections in the last office action was around 85%.
Among medical diagnostic (“MedDx”) applications, the 101 rejection rate grew from 7% to 32% in the month after the Mayo decision and continued to climb to a high of 64% and to 78% among final office actions just prior to abandonment.
In the month of the last available data (from early 2017), the prevalence of subject matter 101 rejections among all office actions in applications in this field was 52% and among office actions before abandonment, was 62%. However outside of impacted areas, the footprint of 101 remained small, appearing in under 15% of all office actions. A subsequent piece will consider additional data and implications for policy."
Copyright © 2018 Robert Moll. All rights reserved.
From the Abstract:
"The Supreme Court’s patentable subject matter jurisprudence from 2011 to 2014 has raised significant policy concerns within the patent community. Prominent groups within the IP community and academia, and commentators to the 2017 USPTO Patentable Subject Matter report have called for an overhaul of the Supreme Court’s “two-step test.”
Based on an analysis of 4.4 million office actions mailed from 2008 through mid-July 2017 covering 2.2 million unique patent applications, this article uses a novel technology identification strategy and a differences-in-differences approach to document a spike in 101 rejections among select medical diagnostics and software/business method applications following the Alice and Mayo decisions.
Within impacted classes of TC 3600 (“36BM”), the 101 rejection rate grew from 25% to 81% in the month after the Alice decision, and has remained above 75% almost every month through the last month of available data (2/2017); among abandoned applications, the prevalence of 101 rejection subject matter rejections in the last office action was around 85%.
Among medical diagnostic (“MedDx”) applications, the 101 rejection rate grew from 7% to 32% in the month after the Mayo decision and continued to climb to a high of 64% and to 78% among final office actions just prior to abandonment.
In the month of the last available data (from early 2017), the prevalence of subject matter 101 rejections among all office actions in applications in this field was 52% and among office actions before abandonment, was 62%. However outside of impacted areas, the footprint of 101 remained small, appearing in under 15% of all office actions. A subsequent piece will consider additional data and implications for policy."
Copyright © 2018 Robert Moll. All rights reserved.
Sunday, December 23, 2018
IAM - After China Win, Qualcomm Follows Up with A German Injunction
Joff Wild's article IAM After China Win, Qualcomm Follows Up with A German Injunction suggests China is stepping up its patent enforcement game.
China has been more lax in enforcing patents than the United States until recently. For many years, US courts automatically granted injunctions after a patent was held valid, enforceable, and infringed. 35 U.S.C. §154 suggested that they should be granted given a patent grants the right to exclude others from making, using, offering for sale, or selling the invention in the United States during the patent term.
But that routine grant of injunctions really stopped after EBay v. MercExchange. There the Supreme Court repudiated the Federal Circuit's practice of automatically granting injunctions. It recognized courts should grant injunctions in accordance with equity to prevent violation of patent rights on such terms as the court deems reasonable. 35 U.S.C. § 283. EBay basically set up some hurdles after a patent owner won its case. Going forward the patent owner seeking a permanent injunction would also need to demonstrate it satisfied a four factor test:
(1) that it has suffered an irreparable injury;
(2) that remedies available at law are inadequate to compensate for that injury;
(3) that considering the balance of hardships between the plaintiff and defendant, a remedy in equity
is warranted; and
(4) that the public interest would not be disserved by a permanent injunction.
Courts can grant permanent injunctions as part of a final judgment between competitors, but proving the four factors can be a challenge for patent owners when it involves non-competitors in the United States. Even though injunctions are becoming more common in China and Germany it was surprising to see how rapidly a chip designer such as Qualcomm was granted a preliminary injunction (not easy to get in the USA) against the Apple iPhone in China and a permanent injunction in Germany with no injunctive relief in sight in United States. Yes, these events suggest key patent litigation disputes may be decided on the "other side" of the earth.
Copyright © 2018 Robert Moll. All rights reserved.
China has been more lax in enforcing patents than the United States until recently. For many years, US courts automatically granted injunctions after a patent was held valid, enforceable, and infringed. 35 U.S.C. §154 suggested that they should be granted given a patent grants the right to exclude others from making, using, offering for sale, or selling the invention in the United States during the patent term.
But that routine grant of injunctions really stopped after EBay v. MercExchange. There the Supreme Court repudiated the Federal Circuit's practice of automatically granting injunctions. It recognized courts should grant injunctions in accordance with equity to prevent violation of patent rights on such terms as the court deems reasonable. 35 U.S.C. § 283. EBay basically set up some hurdles after a patent owner won its case. Going forward the patent owner seeking a permanent injunction would also need to demonstrate it satisfied a four factor test:
(1) that it has suffered an irreparable injury;
(2) that remedies available at law are inadequate to compensate for that injury;
(3) that considering the balance of hardships between the plaintiff and defendant, a remedy in equity
is warranted; and
(4) that the public interest would not be disserved by a permanent injunction.
Courts can grant permanent injunctions as part of a final judgment between competitors, but proving the four factors can be a challenge for patent owners when it involves non-competitors in the United States. Even though injunctions are becoming more common in China and Germany it was surprising to see how rapidly a chip designer such as Qualcomm was granted a preliminary injunction (not easy to get in the USA) against the Apple iPhone in China and a permanent injunction in Germany with no injunctive relief in sight in United States. Yes, these events suggest key patent litigation disputes may be decided on the "other side" of the earth.
Copyright © 2018 Robert Moll. All rights reserved.
Tuesday, December 18, 2018
Frakes & Wasserman - Irrational Ignorance at the Patent Office
Frakes & Wasserman, Irrational Ignorance at the Patent Office (2018) revisit the merit of Lemley, Rational Ignorance at the Patent Office (2001).
From the Abstract:
"There is widespread belief that the Patent Office issues too many bad patents that impose significant harms on society. At first glance, the solution to the patent quality crisis seems straightforward: give patent examiners more time to review applications so they grant patents only to those inventions that deserve them. Yet the answer to the harms of invalid patents may not be that easy. It is possible that the Patent Office is, as Mark Lemley famously wrote, “rationally ignorant.” In Rational Ignorance at the Patent Office, Lemley argued that because so few patents are economically significant, it makes sense to rely upon litigation to make detailed validity determinations in those rare cases rather than increase the expenses associated with conducting a more thorough review of all patent applications. He supported his thesis with a cost-benefit calculation in which he concluded that the costs of giving examiners more time outweighs the benefits of doing so.
Given the import of the rational ignorance concept to the debate on how best to address bad patents, the time is ripe to revisit this discussion. This Article seeks to conduct a similar cost-benefit analysis to the one that Lemley attempted nearly fifteen years ago. In doing so, we employ new and rich sources of data along with sophisticated empirical techniques to form novel, empirically driven estimates of the relationships that Lemley was forced, given the dearth of empirical evidence at his time, to assume in his own analysis. Armed with these new estimates, this Article demonstrates that the savings in future litigation and prosecution expenses associated with giving examiners additional time per application more than outweigh the costs of increasing examiner time allocations. Thus, we conclude the opposite of Lemley: society would be better off investing more resources in the Agency to improve patent quality than relying upon ex-post litigation to weed out invalid patents. Given its current level of resources, the Patent Office is not being “rationally ignorant” but, instead, irrationally ignorant."
Copyright © 2018 Robert Moll. All rights reserved.
From the Abstract:
"There is widespread belief that the Patent Office issues too many bad patents that impose significant harms on society. At first glance, the solution to the patent quality crisis seems straightforward: give patent examiners more time to review applications so they grant patents only to those inventions that deserve them. Yet the answer to the harms of invalid patents may not be that easy. It is possible that the Patent Office is, as Mark Lemley famously wrote, “rationally ignorant.” In Rational Ignorance at the Patent Office, Lemley argued that because so few patents are economically significant, it makes sense to rely upon litigation to make detailed validity determinations in those rare cases rather than increase the expenses associated with conducting a more thorough review of all patent applications. He supported his thesis with a cost-benefit calculation in which he concluded that the costs of giving examiners more time outweighs the benefits of doing so.
Given the import of the rational ignorance concept to the debate on how best to address bad patents, the time is ripe to revisit this discussion. This Article seeks to conduct a similar cost-benefit analysis to the one that Lemley attempted nearly fifteen years ago. In doing so, we employ new and rich sources of data along with sophisticated empirical techniques to form novel, empirically driven estimates of the relationships that Lemley was forced, given the dearth of empirical evidence at his time, to assume in his own analysis. Armed with these new estimates, this Article demonstrates that the savings in future litigation and prosecution expenses associated with giving examiners additional time per application more than outweigh the costs of increasing examiner time allocations. Thus, we conclude the opposite of Lemley: society would be better off investing more resources in the Agency to improve patent quality than relying upon ex-post litigation to weed out invalid patents. Given its current level of resources, the Patent Office is not being “rationally ignorant” but, instead, irrationally ignorant."
Copyright © 2018 Robert Moll. All rights reserved.
Wednesday, December 12, 2018
IP Watchdog - Christmas Gifts for Patent Attorneys and Inventors - One More to the List - David Hricik and Mercedes Meyer Patent Ethics: Prosecution
Today, Gene Quinn of IP Watchdog says "no need to panic" and lists: Christmas Gifts for Patent Attorneys and Inventors.
I am not looking for a gift, but wish to add: David Hricik and Mercedes Meyer Patent Ethics: Prosecution (2016-2017). As stated in chapter 1: "This book comprehensively addresses ethical issues that face patent lawyers, patent agents, companies, and firms that prosecute and opine about patents. This edition also now includes a chapter devoted to post-disposition proceedings, including inter partes review under the AIA."
Not seeing anything like it on Amazon I ordered the Kindle version this week. I am still browsing this substantial book, but so far it appears very useful. I suggest review of the table of contents on Amazon to see what's covered. My mild criticism is this Kindle book is expensive, but still consider it money well spent given what's at stake. It's not the issues on "our ethics radar" that tend to cause problems -- it's the issues that aren't. This book should help spot ethics issues before they cause harm, which is "a gift that keeps on giving."
Copyright © 2018 Robert Moll. All rights reserved.
I am not looking for a gift, but wish to add: David Hricik and Mercedes Meyer Patent Ethics: Prosecution (2016-2017). As stated in chapter 1: "This book comprehensively addresses ethical issues that face patent lawyers, patent agents, companies, and firms that prosecute and opine about patents. This edition also now includes a chapter devoted to post-disposition proceedings, including inter partes review under the AIA."
Not seeing anything like it on Amazon I ordered the Kindle version this week. I am still browsing this substantial book, but so far it appears very useful. I suggest review of the table of contents on Amazon to see what's covered. My mild criticism is this Kindle book is expensive, but still consider it money well spent given what's at stake. It's not the issues on "our ethics radar" that tend to cause problems -- it's the issues that aren't. This book should help spot ethics issues before they cause harm, which is "a gift that keeps on giving."
Copyright © 2018 Robert Moll. All rights reserved.
Monday, December 10, 2018
AIPLA/IPO/ABA-IPL Joint Principles Paper on Section 101
AIPLA/IPO/ABA-IPL Joint Principles Paper on Section 101 calls for Congress to remedy uncertainty in 35 U.S.C. §101 and return balance to the U.S. patent system.
Copyright © 2018 Robert Moll. All rights reserved.
Copyright © 2018 Robert Moll. All rights reserved.
CNBC - Apple recovers losses after Chinese court bans sale of most iPhones
The CNBC article Apple recovers losses after Chinese court bans sale of most iPhones tells us Qualcomm was able to get an injunction that bans sale of iPhones in China. A few infringed Qualcomm patents can apparently shut down significant iPhone sales in China. Even if the injunctive relief is overturned this sounds disruptive.
Copyright © 2018 Robert Moll. All rights reserved.
Copyright © 2018 Robert Moll. All rights reserved.
Saturday, December 8, 2018
Bloomberg Law - Justice Department Exits Joint Patent Policy with PTO
If you own or deal with standard essential patents (SEP), you may want to read the Bloomberg Law article Justice Department Exits Joint Patent Policy with PTO:
"The Department of Justice has withdrawn from a joint policy with the Patent and Trademark Office on standard-essential patents.
The 2013 agreement, in which the two agencies said it should be difficult for patent owners to block sales or imports of products based on their use of patents in industry standards, no longer reflects the department’s policy on anticompetitive behavior, Assistant U.S. Attorney General Makan Delrahim said in a Dec. 7 speech in Palo Alto, Calif.
Delrahim, the department’s antitrust chief, said his division will work with the PTO to replace the policy."
Copyright © 2018 Robert Moll. All rights reserved.
"The Department of Justice has withdrawn from a joint policy with the Patent and Trademark Office on standard-essential patents.
The 2013 agreement, in which the two agencies said it should be difficult for patent owners to block sales or imports of products based on their use of patents in industry standards, no longer reflects the department’s policy on anticompetitive behavior, Assistant U.S. Attorney General Makan Delrahim said in a Dec. 7 speech in Palo Alto, Calif.
Delrahim, the department’s antitrust chief, said his division will work with the PTO to replace the policy."
Copyright © 2018 Robert Moll. All rights reserved.
Friday, December 7, 2018
WIPO - World Intellectual Property Indicators 2018 - Global IP Activity
WIPO recently published the World Intellectual Property Indicators 2018. It is detailed 231-page look at global IP (e.g., patent and trademark) activity:
From the Foreword:
"Against the backdrop of solid economic growth worldwide, global intellectual property (IP) filing activity set new records in 2017. Patent filings around the world reached 3.17 million, representing a 5.8% growth on 2016 figures. Trademark filing activity totaled 12.39 million, up 26.8% on 2016. Industrial design filing activity exceeded 1.24 million. China remained the main driver of global growth in IP filings. From already high levels, patent filings in China grew by 14.2% and trademark filing activity in China by 55.2%. These high growth rates propelled China’s shares of global patent filings and trademarks filing activity to reach 43.6% and 46.3%, respectively. Japan (+24.2%) and the United States of America (+12.6%) also saw strong growth in trademark filing activity. However, both of those countries recorded almost no growth in patent filings. The Republic of Korea saw a decline in filing activity for patents and trademarks for the second consecutive year. Other notable trends include large increases in trademark filing activity in the Islamic Republic of Iran (+87.9%), the United Kingdom (+24.1%) and Canada (+19.5%). With regard to industrial design filing activity, the United Kingdom (+92.1%), Spain (+23.5%) and Switzerland (+17.9%) saw double-digit growth in 2017."
Copyright © 2018 Robert Moll. All rights reserved.
From the Foreword:
"Against the backdrop of solid economic growth worldwide, global intellectual property (IP) filing activity set new records in 2017. Patent filings around the world reached 3.17 million, representing a 5.8% growth on 2016 figures. Trademark filing activity totaled 12.39 million, up 26.8% on 2016. Industrial design filing activity exceeded 1.24 million. China remained the main driver of global growth in IP filings. From already high levels, patent filings in China grew by 14.2% and trademark filing activity in China by 55.2%. These high growth rates propelled China’s shares of global patent filings and trademarks filing activity to reach 43.6% and 46.3%, respectively. Japan (+24.2%) and the United States of America (+12.6%) also saw strong growth in trademark filing activity. However, both of those countries recorded almost no growth in patent filings. The Republic of Korea saw a decline in filing activity for patents and trademarks for the second consecutive year. Other notable trends include large increases in trademark filing activity in the Islamic Republic of Iran (+87.9%), the United Kingdom (+24.1%) and Canada (+19.5%). With regard to industrial design filing activity, the United Kingdom (+92.1%), Spain (+23.5%) and Switzerland (+17.9%) saw double-digit growth in 2017."
Copyright © 2018 Robert Moll. All rights reserved.
Thursday, December 6, 2018
Supreme Court - Helsinn Healthcare S.A. v. Teva Pharmaceutical USA, Inc. - Hearing Transcript
The United States Supreme Court held a hearing in Helsinn Healthcare v. Teva Pharmaceutical this week.
The issue: "Whether, under the Leahy-Smith America Invents Act, an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention."
For additional details see the hearing transcript and Professor Ronald Mann's argument analysis and America Invents Act - On Sale Bar, 35 USC 102
Copyright © 2018 Robert Moll. All rights reserved.
The issue: "Whether, under the Leahy-Smith America Invents Act, an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention."
For additional details see the hearing transcript and Professor Ronald Mann's argument analysis and America Invents Act - On Sale Bar, 35 USC 102
Copyright © 2018 Robert Moll. All rights reserved.
Wednesday, December 5, 2018
USPTO - Trademark Manual of Examining Procedure (TMEP)
This Fall the USPTO announced publication of the latest Trademark Manual of Examining Procedure (TMEP):
"This revision clarifies USPTO trademark policies and practices and includes relevant Trademark Trial and Appeal Board and court decisions reported before Sept. 15.
This revision supersedes prior versions of the TMEP, examination guides, or any other statement of USPTO policy to the extent that there is any conflict.
For a complete list of changes, see the Change Summary."
Copyright © 2018 Robert Moll. All rights reserved.
"This revision clarifies USPTO trademark policies and practices and includes relevant Trademark Trial and Appeal Board and court decisions reported before Sept. 15.
This revision supersedes prior versions of the TMEP, examination guides, or any other statement of USPTO policy to the extent that there is any conflict.
For a complete list of changes, see the Change Summary."
Copyright © 2018 Robert Moll. All rights reserved.
Tuesday, December 4, 2018
PTAB - Hearsay & Authentication Webinar - December 6, 2018
The USPTO announced a webinar on hearsay and authentication practice before Patent Trial and Appeal Board (PTAB):
"We are hosting a Boardside Chat webinar this Thursday, Dec. 6 from noon to 1 p.m. ET about hearsay and authentication before the board. Lead Judge Michael Zecher along with Judge Tom Giannetti and Judge Grace Obermann will present.
The webinar is free and open to all. There will be a Q&A session at the end of the presentation, so please send questions in advance or during the webinar to PTABBoardsideChat@uspto.gov.
More information, including the webinar access information, is available on the PTAB "Boardside Chat" webinar series webpage of the USPTO website."
Copyright © 2018 Robert Moll. All rights reserved.
"We are hosting a Boardside Chat webinar this Thursday, Dec. 6 from noon to 1 p.m. ET about hearsay and authentication before the board. Lead Judge Michael Zecher along with Judge Tom Giannetti and Judge Grace Obermann will present.
The webinar is free and open to all. There will be a Q&A session at the end of the presentation, so please send questions in advance or during the webinar to PTABBoardsideChat@uspto.gov.
More information, including the webinar access information, is available on the PTAB "Boardside Chat" webinar series webpage of the USPTO website."
Copyright © 2018 Robert Moll. All rights reserved.
Monday, December 3, 2018
United States Courts - The Patent Process: An Overview for Jurors
In 2013, the United States Courts published a video on YouTube: The Patent Process: An Overview for Jurors to help jurors. It is a nice introduction on US patents in plain English.
Copyright © 2018 Robert Moll. All rights reserved.
Copyright © 2018 Robert Moll. All rights reserved.
Sunday, December 2, 2018
Farre-Mensa et al. - What is a Patent Worth? Evidence from the U.S. Patent "Lottery"
Because of the expense of patenting in the United States, it can be a challenge for a startup to determine whether or not to seek patent protection. Some argue it's waste of money because even if a patent is obtained a startup cannot afford to enforce patent rights. If enforcement makes economic sense and the startup IPOs, it can afford it, and if the startup is acquired, the acquiring company typically has more resources.
Some argue in favor of patenting as a way to increase investor interest. For example, here's support for that view: Farre-Mensa et al., What is a Patent Worth? Evidence from the U.S. Patent "Lottery". As stated in the abstract: "We provide evidence on the value of patents to startups by leveraging the random assignment of applications to examiners with different propensities to grant patents. Using unique data on all first-time applications filed at the U.S. Patent Office since 2001, we find that startups that win the patent “lottery” by drawing lenient examiners have, on average, 55% higher employment growth and 80% higher sales growth five years later. Patent winners also pursue more, and higher quality, follow-on innovation. Winning a first patent boosts a startup’s subsequent growth and innovation by facilitating access to funding from VCs, banks, and public investors."
Copyright © 2018 Robert Moll. All rights reserved.
Some argue in favor of patenting as a way to increase investor interest. For example, here's support for that view: Farre-Mensa et al., What is a Patent Worth? Evidence from the U.S. Patent "Lottery". As stated in the abstract: "We provide evidence on the value of patents to startups by leveraging the random assignment of applications to examiners with different propensities to grant patents. Using unique data on all first-time applications filed at the U.S. Patent Office since 2001, we find that startups that win the patent “lottery” by drawing lenient examiners have, on average, 55% higher employment growth and 80% higher sales growth five years later. Patent winners also pursue more, and higher quality, follow-on innovation. Winning a first patent boosts a startup’s subsequent growth and innovation by facilitating access to funding from VCs, banks, and public investors."
Copyright © 2018 Robert Moll. All rights reserved.
Thursday, November 29, 2018
USPTO - Strategic Plan 2018-2022
Today, the United States Patent and Trademark Office (USPTO) published its Strategic Plan:
"The strategic plan sets out the USPTO’s mission-focused strategic goals: to optimize patent quality and timeliness; to optimize trademark quality and timeliness; and, to provide domestic and global leadership to improve intellectual property policy, enforcement, and protection worldwide.
We are confident in attaining the goals set out in this plan and look forward to the continued engagement and feedback from our stakeholders and employees, said Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office Andrei Iancu.
Together we celebrate innovation and entrepreneurship—we are very proud of the men and women who stand behind a well-balanced American intellectual property system. In conjunction with the development of the strategic plan, the USPTO is committed to making execution of the strategic plan an express responsibility of USPTO executives. This includes monitoring implementation of the plan, as well as keeping employees, stakeholders, and the public informed of progress. The USPTO website and the Data Visualization Center are key components of this communications commitment.
A draft USPTO 2018-2022 Strategic Plan was posted on July 26, 2018, for employee review and feedback followed by a town hall meeting on July 24, 2018. The draft plan was then posted on the USPTO website on Aug. 22, 2018, and comments were solicited from stakeholders, customers, and the general public. Review and comments were also sought from the USPTO’s Patent and Trademark Public Advisory Committees, in addition to the three union bargaining unit presidents. Also, the proposed strategic plan was shared with the Department of Commerce, the Office of Management and Budget, and Congress."
For more information see as follows: www.uspto.gov/StrategicPlan.
Copyright © 2018 Robert Moll. All rights reserved.
"The strategic plan sets out the USPTO’s mission-focused strategic goals: to optimize patent quality and timeliness; to optimize trademark quality and timeliness; and, to provide domestic and global leadership to improve intellectual property policy, enforcement, and protection worldwide.
We are confident in attaining the goals set out in this plan and look forward to the continued engagement and feedback from our stakeholders and employees, said Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office Andrei Iancu.
Together we celebrate innovation and entrepreneurship—we are very proud of the men and women who stand behind a well-balanced American intellectual property system. In conjunction with the development of the strategic plan, the USPTO is committed to making execution of the strategic plan an express responsibility of USPTO executives. This includes monitoring implementation of the plan, as well as keeping employees, stakeholders, and the public informed of progress. The USPTO website and the Data Visualization Center are key components of this communications commitment.
A draft USPTO 2018-2022 Strategic Plan was posted on July 26, 2018, for employee review and feedback followed by a town hall meeting on July 24, 2018. The draft plan was then posted on the USPTO website on Aug. 22, 2018, and comments were solicited from stakeholders, customers, and the general public. Review and comments were also sought from the USPTO’s Patent and Trademark Public Advisory Committees, in addition to the three union bargaining unit presidents. Also, the proposed strategic plan was shared with the Department of Commerce, the Office of Management and Budget, and Congress."
For more information see as follows: www.uspto.gov/StrategicPlan.
Copyright © 2018 Robert Moll. All rights reserved.
Tuesday, November 27, 2018
USPTO - Director Iancu - The Role of the Courts in Shaping Patent Law & Policy
On November 26, 2018, Director Iancu delivered remarks on The role of the courts in shaping patent law and policy as it relates to the complex topic of patent eligibility under 35 U.S.C. § 101.
Director Iancu refers to Judge Rich's guidance on applying 35 U.S.C. §101: "problems can arise due to the unfortunate … though clear commingling of distinct statutory provisions which are conceptually unrelated, namely, those pertaining to the categories of invention in § 101 which may be patentable, and to the conditions for patentability demanded by the statute …."
As Director Iancu stated "pursuant to the Patent Act of 1952, we should keep invalidity rejections in their own lanes. If something is not novel or is obvious, we should invalidate it under 102 or 103. If something is indefinite, or too broad to be fully enabled or described, we should invalidate it under 112. We have decades of case law from the courts and decades of experience at the PTO examining millions of patent applications, which guide us in our 102, 103 and 112 analyses. People know these standards and know how to apply these well-defined statutory requirements."
Judge Rich co-drafted the modern U.S. patent system in 1952. Much of that Act remains today. We might have been saved confusion and frustration that ensued in combining §§101/102/103 analysis if we simply took Judge Rich's advice. See Judge Giles Rich Wikipedia.
Copyright © 2018 Robert Moll. All rights reserved.
Director Iancu refers to Judge Rich's guidance on applying 35 U.S.C. §101: "problems can arise due to the unfortunate … though clear commingling of distinct statutory provisions which are conceptually unrelated, namely, those pertaining to the categories of invention in § 101 which may be patentable, and to the conditions for patentability demanded by the statute …."
As Director Iancu stated "pursuant to the Patent Act of 1952, we should keep invalidity rejections in their own lanes. If something is not novel or is obvious, we should invalidate it under 102 or 103. If something is indefinite, or too broad to be fully enabled or described, we should invalidate it under 112. We have decades of case law from the courts and decades of experience at the PTO examining millions of patent applications, which guide us in our 102, 103 and 112 analyses. People know these standards and know how to apply these well-defined statutory requirements."
Judge Rich co-drafted the modern U.S. patent system in 1952. Much of that Act remains today. We might have been saved confusion and frustration that ensued in combining §§101/102/103 analysis if we simply took Judge Rich's advice. See Judge Giles Rich Wikipedia.
Copyright © 2018 Robert Moll. All rights reserved.
Sunday, November 25, 2018
CAFC - Berkheimer v. HP, Inc. - 35 USC 101 Patent Eligibility & USPTO Memo
In Berkheimer v. HP, Inc., the Federal Circuit clarified step two of the U.S. Supreme Court's Alice test for patent eligibility under 35 U.S.C. § 101. It noted that Mayo requires consideration of the elements of each claim both individually and as an ordered combination to determine whether the additional elements transform the nature of the claim into a patent eligible application. It noted that will be satisfied when the claim involves more than performance of well understood, routine, and conventional activities previously known to the industry.
Moreover, the Federal Circuit stated the question of whether a claim element or combination of elements is well-understood, routine and conventional to a skilled artisan in the relevant field is a question of fact and must be proven by clear and convincing evidence.
Note this decision is an important case in determination of patent eligibility under 35 U.S.C. § 101, because it gives patent applicants and patent owners a means to push back on purely subjective opinion that a claim lacks an "inventive concept."
See also the USPTO Memo Changes in Examination Procedure Pertaining to Subject Matter Eligibility, Recent Subject Matter Eligibility Decision (Berkheimer v. HP, Inc.).
Copyright © 2018 Robert Moll. All rights reserved.
Moreover, the Federal Circuit stated the question of whether a claim element or combination of elements is well-understood, routine and conventional to a skilled artisan in the relevant field is a question of fact and must be proven by clear and convincing evidence.
Note this decision is an important case in determination of patent eligibility under 35 U.S.C. § 101, because it gives patent applicants and patent owners a means to push back on purely subjective opinion that a claim lacks an "inventive concept."
See also the USPTO Memo Changes in Examination Procedure Pertaining to Subject Matter Eligibility, Recent Subject Matter Eligibility Decision (Berkheimer v. HP, Inc.).
Copyright © 2018 Robert Moll. All rights reserved.
Friday, November 23, 2018
Supreme Court - Oil States Energy Services, LLC v. Greene's Energy Group, LLC - Inter Partes Review Not Unconstitutional
In Oil States Energy Services, LLC v. Greene's Energy Group, LLC, the Supreme Court considered "whether inter partes review- an adversarial process used by the Patent and Trademark Office
(PTO) to analyze the validity of existing patents- violates the Constitution by extinguishing
private property rights through a non-Article III forum without a jury."
The Supreme Court held that Inter Partes Review (IPR) proceedings (35 U.S.C. 311-319) before the Patent Trial and Appeal Board (PTAB) do not violate Article III or the Seventh Amendment of the Constitution. In short, Justice Thomas for seven of the justices reasoned that "the decision to grant a patent is matter involving public rights" and "inter partes review is simply a reconsideration of that grant ... Congress has permissibly reserved the PTO's authority to conduct that reconsideration."
Many commentators predicted inter partes review (IPR) would be held constitutional. A more tricky prediction is how much the USPTO's new regulations and policies will level the IPR playing field for patent owners in the future.
Copyright © 2018 Robert Moll. All rights reserved.
The Supreme Court held that Inter Partes Review (IPR) proceedings (35 U.S.C. 311-319) before the Patent Trial and Appeal Board (PTAB) do not violate Article III or the Seventh Amendment of the Constitution. In short, Justice Thomas for seven of the justices reasoned that "the decision to grant a patent is matter involving public rights" and "inter partes review is simply a reconsideration of that grant ... Congress has permissibly reserved the PTO's authority to conduct that reconsideration."
Many commentators predicted inter partes review (IPR) would be held constitutional. A more tricky prediction is how much the USPTO's new regulations and policies will level the IPR playing field for patent owners in the future.
Copyright © 2018 Robert Moll. All rights reserved.
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.
Sunday, November 18, 2018
US Supreme Court - WesternGeco LLC v. ION Geophysical Corp. - Damages for Patent Infringing Exports
In WesternGeco LLC v. ION Geophysical Corp., the US Supreme Court held that "under the Patent Act, a company can be liable for patent
infringement if it ships components of a patented
invention overseas to be assembled there." See 35 U. S. C. §271(f)(2). The Court stated under 35 U.S.C. §284 "a patent owner who proves infringement
under this provision is entitled to recover damages" and held the patent owner should recover its lost foreign profits ($90 Million).
Copyright © 2018 Robert Moll. All rights reserved.
Copyright © 2018 Robert Moll. All rights reserved.
Saturday, November 3, 2018
IP Watchdog - Director Andrei Iancu lauds risk takers, calls patent troll narrative "Orwellian doublespeak"
The article Director Andrei Iancu lauds risk takers, calls patent troll narrative "Orwellian doublespeak" is encouraging if you are tired of the patent troll narrative. Things appear to be shifting in favor of patent owners at the USPTO.
Copyright © 2018 Robert Moll. All rights reserved.
Copyright © 2018 Robert Moll. All rights reserved.
Wednesday, October 24, 2018
USPTO - Final rule changing claim construction standard for interpreting claims in AIA trial proceeding
The USPTO has changed the claim construction standard to better reflect the difficulty patent owners have experienced in amending claims in AIA trials. It recently "published a final rule changing the claim construction standard applied during inter partes review (IPR), post-grant
review (PGR), and the transitional program for covered business method
patents (CBM) proceedings before the PTAB.
The final rule replaces the “broadest reasonable interpretation” standard with the federal court claim construction standard that is used to construe a claim in a civil action under 35 U.S.C. § 282(b). This is the same claim construction standard articulated in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc), and its progeny.
Additionally, under the final rule, when construing a claim term in an IPR, PGR, or CBM, the PTAB will take into consideration any prior claim construction determination that has been made in a civil action, or a proceeding before the International Trade Commission (ITC), if that prior claim construction is timely made of record in that IPR, PGR, or CBM.
The USPTO received a total of 374 comments from individuals, corporations, associations, law firms, and law professors in response to its May 9, 2018, Notice of Proposed Rulemaking (NPRM). A significant majority of comments supported the proposed change. As noted in the rule package, the change will lead, among other things, to greater consistency and harmonization with the federal courts and the ITC and lead to greater certainty and predictability in the patent system. The final rule adopts the proposed rule language set forth in the NPRM, with a few changes for clarification purposes.
Several comments questioned the proposed “retroactive” application of the rule. In response to these comments, the final rule will not be retroactively applied and instead will apply only to IPR, PGR, and CBM petitions filed on or after the effective date of the final rule, which is Nov. 13, 2018."
If you are interested in the background and details of this change to claim construction, see the Federal Register Final Rules.
Copyright © 2018 Robert Moll. All rights reserved.
The final rule replaces the “broadest reasonable interpretation” standard with the federal court claim construction standard that is used to construe a claim in a civil action under 35 U.S.C. § 282(b). This is the same claim construction standard articulated in Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc), and its progeny.
Additionally, under the final rule, when construing a claim term in an IPR, PGR, or CBM, the PTAB will take into consideration any prior claim construction determination that has been made in a civil action, or a proceeding before the International Trade Commission (ITC), if that prior claim construction is timely made of record in that IPR, PGR, or CBM.
The USPTO received a total of 374 comments from individuals, corporations, associations, law firms, and law professors in response to its May 9, 2018, Notice of Proposed Rulemaking (NPRM). A significant majority of comments supported the proposed change. As noted in the rule package, the change will lead, among other things, to greater consistency and harmonization with the federal courts and the ITC and lead to greater certainty and predictability in the patent system. The final rule adopts the proposed rule language set forth in the NPRM, with a few changes for clarification purposes.
Several comments questioned the proposed “retroactive” application of the rule. In response to these comments, the final rule will not be retroactively applied and instead will apply only to IPR, PGR, and CBM petitions filed on or after the effective date of the final rule, which is Nov. 13, 2018."
If you are interested in the background and details of this change to claim construction, see the Federal Register Final Rules.
Copyright © 2018 Robert Moll. All rights reserved.
Thursday, September 27, 2018
USPTO - Director Iancu Remarks -- 35 USC 101 Patent Eligibility
At a recent IPO annual meeting, Director Iancu delivered remarks on how we should view patent eligibility under 35 USC 101:
"I’ll focus my remarks on a specific proposal for Section 101—patentable subject matter.
As many of you know, we recently issued to our examiners two new guidance memos on Section 101: the first dealing with the "conventionality” step in the Mayo/Alice framework, and the second on “methods of treatment” claims. Our data shows that these two memos have already improved the 101 analysis during examination.
But significantly more work needs to be done, especially on the “abstract idea” exception.
I know that IPO committees have been hard at work on a legislative fix to Section 101. Indeed, IPO and AIPLA have joined forces recently and proposed new statutory language. Should Congress be interested in moving forward with hearings or legislation, the USPTO would be very happy to help. As we all know, however, any legislative effort takes a long time, and the result is uncertain.
In the meantime, the USPTO cannot wait. We have thousands of examiners who struggle with these issues on a daily basis. Our examiners need additional guidance now. And so do patent applicants, patent owners, and the public. Whether through legislation or otherwise, there is a growing consensus that the issue must be promptly addressed.
In fact, several Federal Circuit judges have recently filed concurrences or dissents explaining the uncertain nature of the law and calling for change.
In order to “work its way out of what so many in the innovation field consider are §101 problems,” Judge Lourie—in an opinion joined by Judge Newman—appealed to a higher authority. “Resolution of patent-eligibility issues requires higher intervention, hopefully with ideas reflective of the best thinking that can be brought to bear on the subject.”
Judge Plager, in another case, noted that “the state of the law is such as to give little confidence that the outcome is necessarily correct.” He explained that, given current §101 jurisprudence, it is “near impossible to know with any certainty whether the invention is or is not patent eligible.” And he concluded that we currently have an “incoherent body of doctrine.”
And Judge Linn explained that the abstract idea test is “indeterminate and often leads to arbitrary results.”
I agree with all these sentiments.
Judge Giles Rich, an icon of patent law with an unparalleled understanding of—and impact on—our system, stated, in 1979, the crux of the problem with respect to §101 jurisprudence. He said at the time that problems can arise due to the “unfortunate … though clear commingling of distinct statutory provisions which are conceptually unrelated, namely, those pertaining to the categories of invention in §101 which may be patentable, and to the conditions for patentability demanded by the statute…”
This was almost 40 years ago! How perceptive and prescient Judge Rich was.
Let me put this in my own words: How can a claim be novel enough to pass 102 and nonobvious enough to pass 103, yet lack an “inventive concept” and therefore fail 101? Or, how can a claim be concrete enough so that one of skill in the art can make it without undue experimentation, and pass 112, yet abstract enough to fail 101? How can something concrete be abstract?
These problems confound the most sophisticated practitioners in our patent system. People simply don’t know how to draw these distinctions. If something is not inventive, then invalidate it under 102 or 103. If something is indefinite, or too broad to be fully enabled or described, then invalidate it under 112.
We have decades of case law from the courts and millions of examinations at the PTO which guide us in our 102, 103, and 112 analyses. People know these standards and how to apply these well-defined statutory requirements.
The genius of the 1952 Patent Act, of which Judge Rich is widely viewed as a principal author, was that it categorized the bases for patentability. Our recent §101 case law mushes them all up again. As Judge Rich said, this “may lead to distorted legal conclusions.” And it has. And it must end.
So I propose that we go back and heed Judge Rich’s direction, and keep rejections in their own distinct lanes—as directed, in fact, by the 1952 Act. Let’s stop commingling the categories of invention on one hand, with the conditions for patentability on the other. Section 101 is about subject matter. It is meant to address categories of matter that are not ever eligible on their own, no matter how inventive or well-claimed they are.
Here is a hint: If the claims can be fixed by slightly different claiming, by narrower claiming, or by more definite claiming, this is likely a “conditions” problem—not a subject matter problem. A pure discovery of nature, like gravity for example, is not eligible no matter how new, how brilliant, and how carefully the claims are written. This is an example of a subject matter issue. The category itself is problematic.
Alright, but what are these problematic categories? I ask because I believe that we must define the categories for these exceptions clearly, lest—in Justice Clarence Thomas’s words—we “swallow all of patent law.” Because—again quoting Justice Thomas—“at some level, ‘all inventions…embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.’” Clearly, though, not all inventions are subject to a judicial exception. So what is the specific subject matter that is problematic and we must exclude? We must be clear, lest we perpetuate the current state. People should know up front. If nothing else, for the sake of a predictable ecosystem, let’s be transparent.
And in particular, the issue needing most attention is, what precisely is the meaning of the “abstract idea” exception? Section 101 itself lists four categories: process, machine, manufacture, and composition of matter. The judicial exceptions should likewise be clearly categorized. As Judge Rich explained, when we deal with §101, “the sole question…is whether the invention falls into a named category, not whether it is patentable...”
So at the USPTO we are contemplating revised guidance to help categorize the exceptions—and indeed to name them—and instruct examiners on how to apply them.
More specifically, the contemplated guidance would do two primary things: First, it would categorize the exceptions based on a synthesis of the case law to date. And second, if a claim does recite a categorized exception, we would instruct examiners to decide if it is “directed to” that exception by determining whether such exception is integrated into a practical application. These two clarifications would help drive more predictability back into the analysis while remaining true to the case law that gave rise to these judicial exceptions in the first place.
So first, what exactly should be captured by the judicial exceptions to §101? In essence, and because we no longer want to mush subject matter with the conditions of patentability, the exceptions should capture only those claims that the Supreme Court has said remain outside the categories of patent protection, despite being novel, nonobvious, and well-disclosed. And what are the categories of inventions that the court told us that we should not patent even where the applicant demonstrates full compliance with Sections 102, 103 and 112? The Supreme Court gave us the answer: the “basic tools of scientific and technological work.”
And what are these “basic tools?” I believe that the Supreme Court has also told us that, at least through their examples. For example, they certainly include pure discoveries of nature, such as gravity, electromagnetism, DNA, etc.—all natural and before human intervention. So, no matter how brilliant the discovery of a certain DNA sequence in nature might have been, the court said we should not issue a patent in the absence of more. The Myriadcase is a recent example.
Also, fundamental mathematics like calculus, geometry, or arithmetic per se. That is, no matter how novel and well-described Newton’s calculus may have been, it is still not patentable by itself. It can be thought of as abstract no matter what. Perhaps “inherently” ineligible, some might say. The Bensoncase is an example.
Some basic “methods of organizing human activity,” such as fundamental economic practices like market hedging and escrow transactions, have also been excluded by the Supreme Court in Bilski and Alice.
And the court has also warned against pure mental processes such as forming a judgment or observation. Again, by itself, something performed solely in the human mind can be thought of as abstract no matter how it is claimed.
The Supreme Court has been interpreting this statute for the past 200 years or so, and throughout that time has given only a limited number of examples of these “basic tools of scientific and technological work”—and arguably they can all generally fit into the categories I just mentioned. So let’s turn now and ask in a bit more detail, what do the various exceptions articulated by the Supreme Court really encompass? There is less difficulty with understanding the categories for laws of nature and natural phenomena.
Folks can arguably identify things like gravity or DNA in a claim. Abstract ideas, on the other hand, have proven more challenging to define. But a thorough review of the relevant case law helps us draw more clear lines. At the USPTO we have undertaken just such a review and have studied every relevant case in detail.
And so, the proposed PTO guidance would synthesize “abstract ideas” as falling into the following three categories:
Mathematical concepts like mathematical relationships, formulas, and calculations
Certain methods of organizing human interactions, such as fundamental economic practices commercial and legal interactions; managing relationships or interactions between people; and advertising, marketing, and sales activities
Mental processes, which are concepts performed in the human mind, such as forming an observation, evaluation, judgment, or opinion.
Under the first step of the proposed guidance, we would first look to see if the claims are within the four statutory categories: process, machine, manufacture, or composition of matter. This is not new—we always do this. If statutory, we would then check to see if the claims recite matter within one of the judicial exceptions, categorized as I just mentioned. This is the new approach.
If the claims at issue do not recite subject matter falling into one of these categories, then the 101 analysis is essentially concluded and the claim is eligible. This alone would resolve a significant number of cases currently confounding our system. If an examiner does not find matter within the disallowed categories, he or she can move on.
Now, on the other hand, if the claims do recite subject matter in one of the excluded categories, the Supreme Court has instructed that we need to do more analysis. Specifically, the court instructed us that in such cases we need to decide whether the claims are “directed to” those categories.
To that end, we must first understand what the line is that the court wants us to draw to decide whether the claim is “directed to” an excluded category or not. The proposed new guidance would explain that Supreme Court jurisprudence taken together effectively allows claims that include otherwise excluded matter as long as that matter is integrated into a practical application. The line, in other words, delineates mere principles, on one hand, from practical applications of such principles, on the other.
For example, in Le Roy v. Tathem, the court said in 1853 that “a new property discovered in matter, when practically applied in the construction of a useful article of commerce or manufacture, is patentable.” Then 128 years later, in Diamond v. Diehr, the court repeated that “an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection.” And recently, in Mayo, the court explained that “applications of such concepts to a new and useful end … remain eligible for patent protection.”
And so, if the claim integrates the exception into a practical application, then the claim is not “directed to” the prohibited matter. In such cases, the claim passes 101 and the eligibility analysis would conclude. Otherwise, we would move to step 2 of Alice, for example as explained in the office’s Berkheimermemo from earlier this year.
It is important to note that the first step of our analysis does not include questions about “conventionality,” which are addressed in Alice Step 2. That is, it does not matter if the “integration” steps are arguably “conventional”; as long as the integration is into a practical application, then the 101 analysis is concluded. This helps to ensure that there is a meaningful dividing line between 101 and 102/103 analysis. A fully “conventional” yet patent-eligible claim may still be unpatentable as obvious. But it is better to address such a claim with obviousness law that has been developed over 65 years of practice.
The analysis also does not deny claims as ineligible merely because they are broad or functionally-stated or result-oriented. I understand the concern with certain types of broad, functionally defined claims that do not have sufficient support in the specification. But for these cases, USPTO examiners know, and will receive further guidance and training on, how to apply well-defined Section 112 principles.
Put another way, the examination does not conclude merely because we overcome Section 101; we must still examine for patentability under sections 102, 103 and 112. And so for claims that pass 101 because they do not articulate matter in a defined category, or that integrate the matter into a practical application, we can rest assured that other sections of the code should still prevent a patent if the claim is not inventive or is merely on a non-enabled or undescribed or indefinite idea.
In sum, the proposed guidance for Section 101, which addresses step 1 of Alice, would explain that eligibility rejections are to be applied only to claims that recite subject matter within the defined categories of judicial exceptions. And even then, a rejection would only be applied if the claim does not integrate the recited exception into a practical application. This provides significantly more clarity for the great bulk of cases.
Sure, there will be a number of cases that would still be difficult to resolve when we ask whether a claim is within one of the excluded categories, or whether it is a practical application of it. But for the vast majority of cases in the big middle, I suspect that the proposed approach would be significantly simpler.
And we are certainly in need for some simplification.
For many claims right now, we have an option to reject or invalidate, for violations of patentability conditions, under either:
A patentability condition such as 102, 103 or 112, or Section 101 subject matter.
Judge Rich was again perceptive, when he noted 40 years ago that “To provide the option of making such a rejection under either 101 or [a condition for patentability] is confusing and therefore bad law.” Just as Judge Rich warned, we have gotten ourselves into a rut when it comes to Section 101 analysis. With the proposed new guidance, the USPTO is trying to navigate our examiners out of that rut given the current statute and judicial precedent.
And I hope other authorities will join in helping us get out of the rut, at least by keeping rejections in their lane and by clearly categorizing the subject matter of any exception. Please note that if we are to issue such revised new guidance, it would take some time to finalize. During that time, I welcome your comments and thoughts on this and any other proposal.
In the end, we all have the same goal in mind. Born of our Constitution and steeped in an inspiring history of world-changing innovation, the American patent system is a crown jewel, a gold standard. Working together, we can ensure increased clarity in the patent system, and thus ensure that the United States will continue to lead the world in innovation and technological development."
Copyright © 2018 Robert Moll. All rights reserved.
"I’ll focus my remarks on a specific proposal for Section 101—patentable subject matter.
As many of you know, we recently issued to our examiners two new guidance memos on Section 101: the first dealing with the "conventionality” step in the Mayo/Alice framework, and the second on “methods of treatment” claims. Our data shows that these two memos have already improved the 101 analysis during examination.
But significantly more work needs to be done, especially on the “abstract idea” exception.
I know that IPO committees have been hard at work on a legislative fix to Section 101. Indeed, IPO and AIPLA have joined forces recently and proposed new statutory language. Should Congress be interested in moving forward with hearings or legislation, the USPTO would be very happy to help. As we all know, however, any legislative effort takes a long time, and the result is uncertain.
In the meantime, the USPTO cannot wait. We have thousands of examiners who struggle with these issues on a daily basis. Our examiners need additional guidance now. And so do patent applicants, patent owners, and the public. Whether through legislation or otherwise, there is a growing consensus that the issue must be promptly addressed.
In fact, several Federal Circuit judges have recently filed concurrences or dissents explaining the uncertain nature of the law and calling for change.
In order to “work its way out of what so many in the innovation field consider are §101 problems,” Judge Lourie—in an opinion joined by Judge Newman—appealed to a higher authority. “Resolution of patent-eligibility issues requires higher intervention, hopefully with ideas reflective of the best thinking that can be brought to bear on the subject.”
Judge Plager, in another case, noted that “the state of the law is such as to give little confidence that the outcome is necessarily correct.” He explained that, given current §101 jurisprudence, it is “near impossible to know with any certainty whether the invention is or is not patent eligible.” And he concluded that we currently have an “incoherent body of doctrine.”
And Judge Linn explained that the abstract idea test is “indeterminate and often leads to arbitrary results.”
I agree with all these sentiments.
Judge Giles Rich, an icon of patent law with an unparalleled understanding of—and impact on—our system, stated, in 1979, the crux of the problem with respect to §101 jurisprudence. He said at the time that problems can arise due to the “unfortunate … though clear commingling of distinct statutory provisions which are conceptually unrelated, namely, those pertaining to the categories of invention in §101 which may be patentable, and to the conditions for patentability demanded by the statute…”
This was almost 40 years ago! How perceptive and prescient Judge Rich was.
Let me put this in my own words: How can a claim be novel enough to pass 102 and nonobvious enough to pass 103, yet lack an “inventive concept” and therefore fail 101? Or, how can a claim be concrete enough so that one of skill in the art can make it without undue experimentation, and pass 112, yet abstract enough to fail 101? How can something concrete be abstract?
These problems confound the most sophisticated practitioners in our patent system. People simply don’t know how to draw these distinctions. If something is not inventive, then invalidate it under 102 or 103. If something is indefinite, or too broad to be fully enabled or described, then invalidate it under 112.
We have decades of case law from the courts and millions of examinations at the PTO which guide us in our 102, 103, and 112 analyses. People know these standards and how to apply these well-defined statutory requirements.
The genius of the 1952 Patent Act, of which Judge Rich is widely viewed as a principal author, was that it categorized the bases for patentability. Our recent §101 case law mushes them all up again. As Judge Rich said, this “may lead to distorted legal conclusions.” And it has. And it must end.
So I propose that we go back and heed Judge Rich’s direction, and keep rejections in their own distinct lanes—as directed, in fact, by the 1952 Act. Let’s stop commingling the categories of invention on one hand, with the conditions for patentability on the other. Section 101 is about subject matter. It is meant to address categories of matter that are not ever eligible on their own, no matter how inventive or well-claimed they are.
Here is a hint: If the claims can be fixed by slightly different claiming, by narrower claiming, or by more definite claiming, this is likely a “conditions” problem—not a subject matter problem. A pure discovery of nature, like gravity for example, is not eligible no matter how new, how brilliant, and how carefully the claims are written. This is an example of a subject matter issue. The category itself is problematic.
Alright, but what are these problematic categories? I ask because I believe that we must define the categories for these exceptions clearly, lest—in Justice Clarence Thomas’s words—we “swallow all of patent law.” Because—again quoting Justice Thomas—“at some level, ‘all inventions…embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.’” Clearly, though, not all inventions are subject to a judicial exception. So what is the specific subject matter that is problematic and we must exclude? We must be clear, lest we perpetuate the current state. People should know up front. If nothing else, for the sake of a predictable ecosystem, let’s be transparent.
And in particular, the issue needing most attention is, what precisely is the meaning of the “abstract idea” exception? Section 101 itself lists four categories: process, machine, manufacture, and composition of matter. The judicial exceptions should likewise be clearly categorized. As Judge Rich explained, when we deal with §101, “the sole question…is whether the invention falls into a named category, not whether it is patentable...”
So at the USPTO we are contemplating revised guidance to help categorize the exceptions—and indeed to name them—and instruct examiners on how to apply them.
More specifically, the contemplated guidance would do two primary things: First, it would categorize the exceptions based on a synthesis of the case law to date. And second, if a claim does recite a categorized exception, we would instruct examiners to decide if it is “directed to” that exception by determining whether such exception is integrated into a practical application. These two clarifications would help drive more predictability back into the analysis while remaining true to the case law that gave rise to these judicial exceptions in the first place.
So first, what exactly should be captured by the judicial exceptions to §101? In essence, and because we no longer want to mush subject matter with the conditions of patentability, the exceptions should capture only those claims that the Supreme Court has said remain outside the categories of patent protection, despite being novel, nonobvious, and well-disclosed. And what are the categories of inventions that the court told us that we should not patent even where the applicant demonstrates full compliance with Sections 102, 103 and 112? The Supreme Court gave us the answer: the “basic tools of scientific and technological work.”
And what are these “basic tools?” I believe that the Supreme Court has also told us that, at least through their examples. For example, they certainly include pure discoveries of nature, such as gravity, electromagnetism, DNA, etc.—all natural and before human intervention. So, no matter how brilliant the discovery of a certain DNA sequence in nature might have been, the court said we should not issue a patent in the absence of more. The Myriadcase is a recent example.
Also, fundamental mathematics like calculus, geometry, or arithmetic per se. That is, no matter how novel and well-described Newton’s calculus may have been, it is still not patentable by itself. It can be thought of as abstract no matter what. Perhaps “inherently” ineligible, some might say. The Bensoncase is an example.
Some basic “methods of organizing human activity,” such as fundamental economic practices like market hedging and escrow transactions, have also been excluded by the Supreme Court in Bilski and Alice.
And the court has also warned against pure mental processes such as forming a judgment or observation. Again, by itself, something performed solely in the human mind can be thought of as abstract no matter how it is claimed.
The Supreme Court has been interpreting this statute for the past 200 years or so, and throughout that time has given only a limited number of examples of these “basic tools of scientific and technological work”—and arguably they can all generally fit into the categories I just mentioned. So let’s turn now and ask in a bit more detail, what do the various exceptions articulated by the Supreme Court really encompass? There is less difficulty with understanding the categories for laws of nature and natural phenomena.
Folks can arguably identify things like gravity or DNA in a claim. Abstract ideas, on the other hand, have proven more challenging to define. But a thorough review of the relevant case law helps us draw more clear lines. At the USPTO we have undertaken just such a review and have studied every relevant case in detail.
And so, the proposed PTO guidance would synthesize “abstract ideas” as falling into the following three categories:
Mathematical concepts like mathematical relationships, formulas, and calculations
Certain methods of organizing human interactions, such as fundamental economic practices commercial and legal interactions; managing relationships or interactions between people; and advertising, marketing, and sales activities
Mental processes, which are concepts performed in the human mind, such as forming an observation, evaluation, judgment, or opinion.
Under the first step of the proposed guidance, we would first look to see if the claims are within the four statutory categories: process, machine, manufacture, or composition of matter. This is not new—we always do this. If statutory, we would then check to see if the claims recite matter within one of the judicial exceptions, categorized as I just mentioned. This is the new approach.
If the claims at issue do not recite subject matter falling into one of these categories, then the 101 analysis is essentially concluded and the claim is eligible. This alone would resolve a significant number of cases currently confounding our system. If an examiner does not find matter within the disallowed categories, he or she can move on.
Now, on the other hand, if the claims do recite subject matter in one of the excluded categories, the Supreme Court has instructed that we need to do more analysis. Specifically, the court instructed us that in such cases we need to decide whether the claims are “directed to” those categories.
To that end, we must first understand what the line is that the court wants us to draw to decide whether the claim is “directed to” an excluded category or not. The proposed new guidance would explain that Supreme Court jurisprudence taken together effectively allows claims that include otherwise excluded matter as long as that matter is integrated into a practical application. The line, in other words, delineates mere principles, on one hand, from practical applications of such principles, on the other.
For example, in Le Roy v. Tathem, the court said in 1853 that “a new property discovered in matter, when practically applied in the construction of a useful article of commerce or manufacture, is patentable.” Then 128 years later, in Diamond v. Diehr, the court repeated that “an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection.” And recently, in Mayo, the court explained that “applications of such concepts to a new and useful end … remain eligible for patent protection.”
And so, if the claim integrates the exception into a practical application, then the claim is not “directed to” the prohibited matter. In such cases, the claim passes 101 and the eligibility analysis would conclude. Otherwise, we would move to step 2 of Alice, for example as explained in the office’s Berkheimermemo from earlier this year.
It is important to note that the first step of our analysis does not include questions about “conventionality,” which are addressed in Alice Step 2. That is, it does not matter if the “integration” steps are arguably “conventional”; as long as the integration is into a practical application, then the 101 analysis is concluded. This helps to ensure that there is a meaningful dividing line between 101 and 102/103 analysis. A fully “conventional” yet patent-eligible claim may still be unpatentable as obvious. But it is better to address such a claim with obviousness law that has been developed over 65 years of practice.
The analysis also does not deny claims as ineligible merely because they are broad or functionally-stated or result-oriented. I understand the concern with certain types of broad, functionally defined claims that do not have sufficient support in the specification. But for these cases, USPTO examiners know, and will receive further guidance and training on, how to apply well-defined Section 112 principles.
Put another way, the examination does not conclude merely because we overcome Section 101; we must still examine for patentability under sections 102, 103 and 112. And so for claims that pass 101 because they do not articulate matter in a defined category, or that integrate the matter into a practical application, we can rest assured that other sections of the code should still prevent a patent if the claim is not inventive or is merely on a non-enabled or undescribed or indefinite idea.
In sum, the proposed guidance for Section 101, which addresses step 1 of Alice, would explain that eligibility rejections are to be applied only to claims that recite subject matter within the defined categories of judicial exceptions. And even then, a rejection would only be applied if the claim does not integrate the recited exception into a practical application. This provides significantly more clarity for the great bulk of cases.
Sure, there will be a number of cases that would still be difficult to resolve when we ask whether a claim is within one of the excluded categories, or whether it is a practical application of it. But for the vast majority of cases in the big middle, I suspect that the proposed approach would be significantly simpler.
And we are certainly in need for some simplification.
For many claims right now, we have an option to reject or invalidate, for violations of patentability conditions, under either:
A patentability condition such as 102, 103 or 112, or Section 101 subject matter.
Judge Rich was again perceptive, when he noted 40 years ago that “To provide the option of making such a rejection under either 101 or [a condition for patentability] is confusing and therefore bad law.” Just as Judge Rich warned, we have gotten ourselves into a rut when it comes to Section 101 analysis. With the proposed new guidance, the USPTO is trying to navigate our examiners out of that rut given the current statute and judicial precedent.
And I hope other authorities will join in helping us get out of the rut, at least by keeping rejections in their lane and by clearly categorizing the subject matter of any exception. Please note that if we are to issue such revised new guidance, it would take some time to finalize. During that time, I welcome your comments and thoughts on this and any other proposal.
In the end, we all have the same goal in mind. Born of our Constitution and steeped in an inspiring history of world-changing innovation, the American patent system is a crown jewel, a gold standard. Working together, we can ensure increased clarity in the patent system, and thus ensure that the United States will continue to lead the world in innovation and technological development."
Copyright © 2018 Robert Moll. All rights reserved.
Friday, August 31, 2018
Supreme Court - SAS Institute Inc. v. Iancu - PTAB Must Decide the Patentability of All The Challenged Claims
Congress created inter partes review (IPR), 35 USC 311-319, to allow a party to challenge the validity of a patent under 35 USC 102 and 103 based on prior art patents and/or publications at relatively low cost in the US Patent Office.
If the party can prove a reasonable likelihood of success of showing the invalidity of at least one claim, the USPTO should institute an IPR.
All patents are eligible for an IPR challenge, but if the patent's earliest effective filing date is on or after March 16, 2013, the IPR must be filed later of the nine month period following issuance of the patent and termination of any post-grant review.
In SAS Institute Inc. v. Iancu, the US Supreme Court addressed a practice of the USPTO to institute an IPR on part of the challenged claims. In SAS, the Supreme held when the USPTO institutes an inter partes review to consider the validity of an issued patent the USPTO must decide the patentability of all the challenged claims. In other words, if PTAB institutes an IPR, it can’t just review the claims that meet the threshold for institution, but must review all of the challenged claims.
My comment is SAS forces careful selection of the patent claims to be challenged, because a written decision that a challenged claim is patentable, may raise an estoppel against further challenge of the claim on the same grounds or grounds that could have been reasonably raised.
Copyright © 2018 Robert Moll. All rights reserved.
If the party can prove a reasonable likelihood of success of showing the invalidity of at least one claim, the USPTO should institute an IPR.
All patents are eligible for an IPR challenge, but if the patent's earliest effective filing date is on or after March 16, 2013, the IPR must be filed later of the nine month period following issuance of the patent and termination of any post-grant review.
In SAS Institute Inc. v. Iancu, the US Supreme Court addressed a practice of the USPTO to institute an IPR on part of the challenged claims. In SAS, the Supreme held when the USPTO institutes an inter partes review to consider the validity of an issued patent the USPTO must decide the patentability of all the challenged claims. In other words, if PTAB institutes an IPR, it can’t just review the claims that meet the threshold for institution, but must review all of the challenged claims.
My comment is SAS forces careful selection of the patent claims to be challenged, because a written decision that a challenged claim is patentable, may raise an estoppel against further challenge of the claim on the same grounds or grounds that could have been reasonably raised.
Copyright © 2018 Robert Moll. All rights reserved.
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