MVS Filewrapper® Blog: Federal Circuit Emphasizes "Reasonable" in Broadest Reasonable Interpretation

Post by Dan Lorentzen



During examination, the claims of patent application are given their broadest reasonable interpretation ("BRI") by the patent examiner.  This USPTO standard is intentionally broad—broader than the interpretation applied in litigation—in order to reduce the possibility that the claim, once issued, will be interpreted more broadly than is justified.  A recent Federal Circuit decision, however, has indicated that the "reasonable" element of the standard is still essential.


In In re Imes, the application at issue was directed to a device for communicating digital camera image and video information over a network.  Independent claim 1 encompassed such a device having memory for storing digital images, a display for displaying the images, an input device for receiving a request for communication, and a housing that stores a first (wireless cellular) communication module and a second (“low power high-speed”) wireless communication module.  Two other independent claims recited communications modules operable to wirelessly communicate streaming video. 


During prosecution, the examiner rejected claim 1 as obvious over a reference that disclosed a first wireless communication module and second module in the form of a removable memory card.  The examiner concluded that the removable memory card met the BRI of the second wireless communication device because it had to be removed in order to communicate the information to a computer—i.e. the metal contacts between the memory card and the computer are not "wire," and therefore communication along the metal contacts to the computer are "wireless."  The examiner rejected the other independent claims as anticipated or obvious over a reference that disclosed a wireless digital camera system that transmits still images over the internet.  The examiner concluded that the BRI of "streaming video" included a continuous process of sending images. The applicant appealed to the Patent Trial and Appeal Board, which affirmed the examiner's rejections.


On appeal, the Federal Circuit took issue with the reasonableness of the USPTO's interpretation of the claims.   The court emphasized that the interpretation must be reasonable in view of the specification.  With regards to the "wireless" element, the USPTO's interpretation was not reasonable because the specification defined the term to refer to electromagnetic waves moving through atmospheric space rather than along a wire.  Accordingly, communication through metal contacts—and not atmospheric space—cannot be reasonably interpreted to constitute "wireless" communication.


With respect to the "streaming video" element, the court concluded that the USPTO's interpretation was not reasonable because there was no substantial evidence to support the conclusion that sending a series of individual still images is equivalent to streaming video. 


The holding in this case can potentially provide some needed clarity to both applicants and examiners as to what is "reasonable" when interpreting claims during patent prosecution.  The full decision is available here. 

MVS Filewrapper® Blog: Teva Decision Clarifies Standard of Review for Claim Construction

Post by Paul S. Mazzola


In Markman v. Westview Instruments, Inc., decided in 1996, the Supreme Court held that the construction of a patent should be decided by a judge and treated as a question of law.  Since Markman, the federal district courts have used pretrial hearings, commonly called "Markman hearings," to interpret appropriate meanings of key relevant words in patent claims.  Based on the language of the Markman opinion and perceived instruction contained therein, the United States Court of Appeals for the Federal Circuit has reviewed findings from Markman hearings, including the underlying factual findings, de novo.  The de novo review of all facets of claim construction is in tension with Federal Rule of Civil Procedure 52(a)(6), which states a court of appeals "must not . . . set aside" a district court's "[f]indings of fact" unless they are clearly erroneous."  To resolve the tension, the Supreme Court decided Teva Pharmaceuticals, Inc. v. Sandoz, Inc. on January 20, 2015.


In Teva, the factual dispute involved interpretation of the term "molecular weight," the calculation (and resulting value and meaning) of which can be achieved by multiple methods; three were considered by the Court.  Based on three possible meanings of "molecular weight," Sandoz argued the claim was indefinite under 35 U.S.C. §112, paragraph 2, as recently interpreted in Nautilus, Inc. v. Biosig Instruments, Inc.  The dispute required extrinsic evidence in the form of testimony and expert opinion.  With competing extrinsic evidence, the United States District Court for the Southern District of New York found that a skilled artisan at the time of the invention would interpret "molecular weight" as calculated by one of the three possible methods, and particularly the one method consistent with Teva's position.  Therefore, the district court held the claim was not indefinite.


The Federal Circuit held to the contrary and invalidated the patent.  Couched in a "de novo review of the district court's indefiniteness holding," the Federal Circuit "conclude[d] that (Teva's expert's) testimony does not save [] claims from indefiniteness."  The court did not provide further analysis regarding the same.  In essence, the Federal Circuit reviewed the underlying factual findings of the district court de novo.


The Supreme Court adjudged the Federal Circuit's analysis deficient.  The Court held that the ultimate question of proper construction of the patent remains a question of law subject to de novo review.  The underlying factual disputes, however, like all other factual determinations, remain under the province of FRCP 52(a)(6), subject to review for clear error.  In doing so, the Court analogized a patent to other written instruments, pointed to precedent, and cited practical considerations, most notably, the comparative advantage for the district court judge, who has presided over the entire proceeding, to render a proper finding.  The Court found unconvincing the argument that it would be unduly difficult for appeal courts to separate factual from legal matters.


To summarize, the ultimate claim construction is a question of law reviewed de novo; when the district court reviews only evidence intrinsic to the patent (i.e., patent documentation and any prosecution history of the patent), the district court's determination will amount solely to a determination of law reviewed de novo; and when a district court reviews extrinsic evidence, the subsidiary factfinding must be reviewed for clear error.


The practical effect of the decision remains to be seen.  Admittedly, in the Teva case, the specific finding of fact of the district court was essentially, if not completely, dispositive of the question of law (i.e., the finding that a skilled artisan would interpret "molecular weight" as calculated by one of the three possible methods rendered the claim definite).  One could envision, however, as contemplated by the Court, numerous examples where the district court's factual finding is much less central to the question of law, thereby permitting the Federal Circuit to adopt the factual finding but reach a different claim construction and/or conclusion of law. See Teva, supra ("In some instances, a factual finding will play only a small rule in a judge's ultimate legal conclusion about the meaning of the patent term.").


Therefore, even when the findings of fact are incorporated in toto, the Federal Circuit itself, in reviewing the claim construction de novo, is free to decide how much relative weight to give to the findings of fact versus its own, perhaps competing, analysis of the very same facts.  Thus, if the Federal Circuit disagrees with the district court's claim construction, even if the findings of fact support the same, the Federal Circuit could adopt said findings of fact while giving them little weight in its overall analysis.  Thus, in instances where the underlying factual dispute may be only mildly or moderately impactful of the ultimate question of law (e.g., indefiniteness, allowable subject matter, novelty, obviousness, etc.), the standard of review, for practical purposes, could arguably return to de novo review.


From a legal practice standpoint, the decision may prove valuable to filter out weaker appeals.  Prior to the Court's clarification in Teva, a losing litigant, who has already endured significant expense in district court, would be apt to appeal to the Federal Circuit to "relitigate" the claim construction and potentially receive a favorable result.  Now, a practitioner must analyze the likelihood of success at the Federal Circuit in light of the findings of fact of the district court; unless, of course, the litigant has a persuasive argument for clear error of the factual findings.  The net result may be a decrease in appeals based solely on an unfavorable claim construction.

MVS Filewrapper® Blog: New Supreme Court Decision Alters Review of Claim Construction Decisions

Post by Dan Lorentzen


The Supreme Court has issues a decision in Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., holding that appellate review of a district court’s decisions relating to subsidiary factual matters made in the course of its patent claim construction must be for  “clear error,” not a de novo standard of review.  Before this decision, all aspects of claim construction were reviewed by the Federal Circuit under the de novo standard, giving no deference to the determinations made by the trial court. 


The decision was authored by Justice Breyer, joined by Chief Justice Roberts and Justices Scalia, Kennedy, Ginsburg, Sotomayor and Kagan joined.  Justices Thomas and Alito dissented. 


A more detailed analysis of the decision will be forthcoming.  The full decision can be found here.


MVS Filewrapper® Blog: Unauthorized Planting does not Constitute Public Use

Post by Dan Lorentzen


The Federal Circuit Court of Appeals has issued a decision in Delano Farms Company v. California Table Grape Commission, holding that the actions of two individuals who obtained samples of the two patented plant varieties in an unauthorized manner and planted them in their own fields did not constitute invalidating public use of the plant varieties.


The case involves two varieties of grapes, which are covered by plant patents owned by the USDA.  The USDA licensed the varieties to the California Grape Commission.  Delano Farms filed suit alleging that the patents were invalid because the varieties were in public use for more than one year before applications for the varieties were filed.  The United States District Court for the Eastern District of California initially ruled that sovereign immunity barred action against the USDA, and that the case could not go forward without the USDA as a party.  The Federal Circuit overturned the decision and remanded to the District Court.  


On remand, the plaintiffs asserted that the claimed varieties were planted and cultivated more than a year before the filing date of the patent applications, which constituted a prior public use under 35 U.S.C. § 102(b) (pre-AIA), thereby invalidating the patents.   The plaintiffs had obtained access to and grew the varieties in 2002, without permission and before the varieties were available to anyone else.  They did not, however, sell or distribute the varieties or their fruit.  The District Court concluded that this activity did not rise to the level use required to invalidate the patents under § 102(b), and ruled for the defendants.  The plaintiffs again appealed to the Federal Circuit.


On appeal, the plaintiffs pointed to a number of actions—cultivation of the varieties, one plaintiff providing plant material to another, and disclosure (but not provision) of the varieties to a business partner—were sufficient to constitute a public use.  The plaintiffs pointed to a number of cases, including the Federal Circuit's 2013 decision in Dey, L.P. v. Sunovion Pharm., Inc., to support their argument that because the plaintiffs made no affirmative efforts to conceal the varieties or keep them secret, their planting constituted public use.  The Federal Circuit held that despite the plaintiffs exchanging of the varieties among themselves and disclosing them to a business partner, all of the actions were taken with the expectation of secrecy.  Further, the court held that the plantings themselves could not constitute public use because, even though they were visible to the public, the varieties could not be identified by the public simply by viewing the vines, and as a result, the public could not be put in possession of the varieties' features. 


The Federal Circuit specifically did not address the issue of whether use of an invention by one who has misappropriated that invention (or obtained it through other improper means) can ever qualify as an invalidating public use. 

MVS Filewrapper® Blog: Are Trademarks for Beer Names Becoming a Commodity?

Post by Alex Christian


While typically we think of finite resources such as oil and coal as commodities, it could be that the next big commodities are names for craft beers and breweries.  According to a recent NPR story, which can be found here, the craft brewing industry is becoming an increasingly crowded industry with more than 3,000 breweries in the United States. Unfortunately for many craft brewers, the individuals behind naming the brews tend to adopt similar—and in some cases, identical—names and labels for their products.  And although it may be the case that many in the craft brewing industry do not seem to mind sharing similar or identical names for their beers, there still remain significant risks of knowingly adopting and using similar marks to other breweries.


The risks involved do not relate solely to future legal battles; rather, the biggest risk may actually be the potential damage confusingly similar trademarks can do to a trademark owner's reputation.  Trademarks are intended to be source identification tools that allow consumers to distinguish product A from product B in the marketplace.  In a crowded industry such as the craft brewing industry, when the marketplace is inundated with hundreds of similar and derivative names for beers, it becomes increasingly difficult for the consumer to identify one particular beer from another. The implication being the trademark for which typically businesses spend significant financial resources to develop and market, fails to serve its very purpose: distinguishing brands in the marketplace.

MVS Filewrapper® Blog: Trade Secret Symposium

Post by Jill Link

The U.S. Patent and Trademark Office (USPTO) is hosting a Trade Secret Symposium on Thursday, January 8, 2015 at its headquarters in Alexandria, Virginia. This symposium is the first of its kind for trade secrets. More information is available on the USPTO website. Both live and webcast attendance is available for this event.

The USPTO symposium will focus on the protection of U.S. trade secrets from misappropriation and is an administrative follow-up from the February 2013 Administration Strategy on Mitigating the Theft of U.S. Trade Secrets. Topics to be discussed include legislative proposals regarding trade secret protection, losses due to trade secret theft and challenges to protecting trade secrets, the intersection of patent and trade secret protection, issues in civil litigation, trade secret protection in foreign jurisdictions, and proposed responses to the threat of trade secret theft in the U.S. Presenters will include representatives of academia, government, legal counsel and industry, and will include time for audience questions.

There is no registration cost for attending either the live or webcast event taking place between 9 am EST and 3 pm EST this Thursday January 8, 2015.

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