·       In Soverain Software LLC v. Newegg Inc. the Federal Circuit vacated in part and reversed in part an Eastern District of Texas decision finding Newegg Inc. liable for infringement of U.S. Patent Nos. 5,715,314, 5,909,492, and 7,272,639, all relating to electronic commerce.  The Federal Circuit offered clarifying insight on the obviousness doctrine.  The background facts are as follows:  Soverain Software purchased three software patents through bankruptcy proceedings and then proceeded to sue seven different entities for infringing the patents.  Six of the defendants settled and entered paid up license agreements with Soverain.  The seventh defendant, Newegg, refused to settle and argued that the asserted patents are all invalid and even if valid, Newegg’s system is different and non-infringing.  At trial, the district court refused to permit Newegg to present its obviousness argument to the jury and ruled that the patents were valid as a matter of law.  The jury found that Newegg had infringed two of the patents but not the third; the district court, however, entered judgment as a matter of law that Newegg infringed the third patent.  Newegg appealed and the Federal Circuit found all three patents obvious.  The federal circuit had three major discussion points:  (1) each element of the disputed claims was found in the prior art, (2) combining those elements would be obvious to one of skill in the art, and (3) licenses entered in settlement to a lawsuit do not constitute evidence of commercial success. 

·       In Rexnord Industries, LLC v. Kappos the Federal Circuit reversed a BPAI decision holding claims for a mechanical conveyor belt patentable.  The patent in question was asserted by Habasit Belting, Inc. against Rexnord Industries in an infringement suit in Delaware district court.  Rexnord filed a request for inter partes reexamination.  The examiner in the reexamination found all of the claims to be unpatentable for anticipation or obviousness. Habasit appealed the examiner’s findings, and the BPAI reversed, concluding that the claims of the patent were not anticipated by any of the references cited in the reexamination, and were unobvious over the cited references.  Rexnord appealed the BPAI decision to the Federal Circuit, arguing that the BPAI erroneously refused to review all of the arguments that Rexnord had presented as grounds for unpatentability.  The PTO countered that the BPAI only needed to consider the issue raised by Habasit on appeal, and had no obligation to consider other grounds that had been presented during reexamination, relying on a BPAI rule that “bars the presentation of new arguments outside appellant’s opening brief.”  The Federal Circuit noted that Rexnord was not the appellant before the BPAI since Habasit appealed the examiner’s decision, and concluded that the alternative bases for obviousness raised in the reexamination were properly raised on appeal to the Federal Circuit because they were fully raised in the reexamination and were not an issue for patentability until after the Board reversed the examiner.  The court then found the claims obvious on these additional grounds.

·       In Hall v. Bed Bath & Beyond, the Federal Circuit affirmed a Southern District of New Your district court’s dismissal of counts against Bed Bath & Beyond (BB&B) executives and counterclaims filed by BB&B, but concluded that the district court’s dismissal of Hall’s design patent infringement, unfair competition, and misappropriation claims for failure to state a claim on which relief can be granted under Federal Rule of Civil Procedure 12(b)(6).  BB&B argued in its motion to dismiss, and the district court agreed, that the complaint was insufficient because if failed to include any claim construction, but the Federal Circuit held the complaint met the requirements for pleading design patent infringement previously set out by the court in Phonometrics, Inc. v. Hospitality Franchise Systems, Inc.  Specifically, the court found the complaint (i) alleged ownership of the patent, (ii) named each defendant, (iii) cited the patent that was allegedly infringed, (iv) stated the means by which the defendant allegedly infringed, and (v) pointed to the sections of the patent law invoked, and in doing so met its burden to withstand a motion to dismiss under Rule 12(b)(6), Twombly and Iqbal. 

Another billion dollar verdict has been handed out in a patent case.  Read the verdict in Carnegie Mellon University v. Marvell Technology Group, LTD. here.  This latest case continues a string of billion dollar verdicts highlighted by Jonathan Kennedy in the latest edition of MVS Briefs. 

Carnegie Mellon brought suit alleging infringement of two of its patents, Patent No. 6,201,839 and Patent No. 6,438,180, relating to integrated circuits for computer memory systems.  Marvell asserted that it did not infringe the patents, and in the alternative, the patents were invalid because they were anticipated or rendered obvious by the prior art.

The jury in the case found for Carnegie Mellon on all counts of infringement—including indirect infringement—and invalidity.  In addition to the large damages award, the jury determined that Marvell had engaged in willful infringement of two patents held by Carnegie Mellon because Marvell knew of the asserted patents before the lawsuit, had no reasonable defense for its actions, and knew or should have known that its actions would infringe the asserted patents.  The determination of willfulness by the jury could allow the presiding judge, U.S. District Judge Norra Barry Fischer, to triple the damages award. 

 A final judgment in the case is expected in May 2013, pending post-trial motions from both sides.  Marvell has already announced its intent to appeal the verdict should its post-trial motions prove unsuccessful. 

In a recent decision, the Federal Circuit affirmed-in-part a district court's decision regarding obviousness, holding the defendant was not entitled to summary judgment that the asserted claims were invalid for obviousness.  The court vacated the district court's entry of judgment of an inconsistent jury verdict of obviousness:  the jury held a dependent claim obvious but the independent claim from which it depends not obvious.  The court stated that such a result reflects an "irreconcilable inconsistency" and thus a new trial on obviousness must be granted.

The court also addressed the question of incorporation by reference.  The defendant argued the claims were anticipated based on a prior art patent that made reference to another patent for one of the relevant limitations.  The district court held the incorporation by reference was ineffective and excluded expert testimony regarding the "combined" prior art.  The Federal Circuit reversed, holding the incorporation by reference was sufficiently specific to be successful, and remanded the issue of anticipation to the district court for redetermination.

More on Callaway Golf Co. v. Acushnet Co. after the jump.

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In a decision Tuesday, the Federal Circuit held the USPTO had not provided sufficient evidence that an inventor's manuscript was publicly accessible, and therefore available as prior art under § 102(b), before the critical date of the application.  As a result, the court reversed the Board of Patent Appeals and Interferences.

At issue was the inventor's own manuscript.  It was undisputed that the manuscript disclosed the invention and was filed with the U.S. Copyright Office more than a year before the filing date of the application.  The Board held this, combined with the ability to search the Copyright Office records by title, provided sufficient evidence of public accessibility to qualify the manuscript as prior art under § 102(b). 

The Federal Circuit reversed.  After surveying the applicable case law, the court held the copyright office automated catalog was insufficient to render the manuscript publicly accessible because it only permitted searching by the author's last name or the first word of the title of the work.  Further, while the copyright office records were spearately indexed by two commercial search providers that permitted keyword searching, there was no evidence in the record of when these commercial search providers would have included the relevant records.  As a result, the court vacated the Board's decision and remanded, noting that the rejection may be reinstated if there was sufficient proof of when the commercial databases indexed the manuscript.

More detail of In re Lister after the jump.

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In a recent decision, the Federal Circuit addressed a variety of claim construction, infringement, and validity issues in an appeal from the International Trade Commission.  After construing five disputed claim terms, the ITC held one of four representative products infringed, the remaining three did not infringe, and one claim invalid as anticipated.  Both parties appealed.

The Federal Circuit affirmed in part, reversed in part, and remanded.  The court affirmed the ITC's construction of 4 of the 5 disputed terms.  However, the modification of one term resulted in the court vacating the ITC's determination of invalidity of one claim, as well as infringement of two of the four devices.  The Federal Circuit affirmed the finding of noninfringement of the other two devices, and remanded for reconsideration of the various issues in light of the revised construction.

More detail of Linear Tech. Corp. v. Int'l Trade Comm'n after the jump.

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The Supreme Court of Canada recently made significant changes to its obviousness standard for patentability. The case addressed a dispute arising between the brand-name pharmaceutical manufacturer, Sanofi, and the Canadian generic manufacturer, Apotex.  The decision by the Supreme Court of Canada brings its obviousness standard closer to the standard recently set forth by the U.S. Supreme Court in KSR v. Teleflex. However, the Canadian obviousness standard still appears to be less stringent than the U.S. obviousness standard.  

More on Apotex, Inc. v. Sanofi-Synthelavo Canada after the jump.

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In a recent decision, the Federal Circuit affirmed a district court's determination, after a bench trial, that the asserted claim of a patent had not been proven anticipated or obvious.  The district court held that while the prior art showed the chemical structure of the claimed compound, it did not describe the separation of the two enantiomers of the compound, nor did it describe the appropriate salt form to use in tableting the compound.   As a result, the claim was not anticipated.  Further, the district court held the claim was not obvious, because the separation of the enantiomers had the unexpected effect of separating the beneficial effects of the compound (produced by one enantiomer) with the harmful side effects of the compound (produced by the other enantiomer).

The Federal Circuit affirmed.  After a detailed analysis of the facts, the court agreed with the district court's analysis that the disclosure of the chemical structure of the compound in the prior art was insufficient to either anticipate or render obvious a claim directed to one of the two enantiomers, given the difficulty and unpredictability in separating enantiomers and the unexpected division of the beneficial and harmful effects between the two enantiomers of this particular compound.

More detail of Sanofi-Synthelabo v. Apotex, Inc. after the jump.

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In a recent decision, the Federal Circuit affirmed a district court's grant of a preliminary injunction concerning the manufacture of an extended release formulation of an antibiotic. In a lengthy opinion, the Federal Circuit applied the Supreme Court's obvious-to-try logic from KSR to pharmaceutical patents. Notably, the court used the unpredictability of the pharmaceutical arts to find that, despite a prior art reference listing twelve different approaches in creating an extended release formula, the claimed formulation was (at least at the preliminary injunction stage) more than the predictable use of prior art elements according to their established functions.

The Federal Circuit also addressed the issue of inequitable conduct, reinforcing its holding in Kingsdown Medical that materiality alone does not automatically establish the bad faith necessary for a finding of inequitable conduct.

The panel majority, after an extensive review of case law regarding injunctive relief, held when determining likelihood of success, the court must examine the question with the ultimate issue in mind, namely whether the party will likely prevail on the issue.  Judge Gajarsa's dissent, on the other hand, took the panel majority to task for diverging from the Federal Circuit's precedent on the issue, and would have held a substantial question of validity and enforceability was raised, making the preliminary injunction improper.

More on Abbot Labs. v. Sandoz, Inc. after the jump.

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In a recent decision, the Federal Circuit affirmed a district court's finding of indefiniteness but reversed the district court's holding of anticipation of other claims.  The district court held the means-plus-function limitations did not have corresponding structure disclosed in the specification, rendering them indefinite, and that the combination of two examples in a prior art publication anticipated the remaining asserted claims.

The Federal Circuit agreed the means-plus-function limitations were indefinite.  The limitations were computer-implemented, which means to be definite, the specification must disclose "more than simply a general purpose computer or microprocessor," but instead must disclose "the special purpose computer programmed to perform the disclosed algorithm."  There was no such disclosure here, so the Federal Circuit held the claims were correctly held indefinite.

Regarding anticipation, however, the court reaffirmed its previous cases holding in order to anticipate, it is not enough for all elements of the claim to be disclosed in a single reference.  All the elements must also be disclosed as arranged in the claim.  Here, the claim elements were spread across two different examples given in the allegedly anticipatory reference, so the Federal Circuit reversed the district court's summary judgment of anticipation because the reference did not disclose the elements as they were arranged in the claim.

More detail of Net MoneyIN, Inc. v. VeriSign, Inc. after the jump.

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In a decision recently designated precedential, the Board of Patent Appeals and Interferences considered the question of whether a reference that is prior art under § 102(e) is prior art as of its provisional priority date or the actual filing date of the reference.  In affirming the examiner, the Board determined the reference was prior art as of its provisional date, as long as the relied-upon disclosure in the reference was sufficiently supported in the provisional filing.

Based on language in the opinion, Examiners have the initial burden of showing the reference's entitlement to the provisional date.  The Board stated (emphasis added):

Although the Examiner's statement regarding the correspondence between the Narayanan patent and its underlying provisional application is somewhat terse and conclusory, the Examiner nonetheless found that both documents "clearly show the same subject matter"—a factual finding.  By making this factual finding, the Examiner then shifted the burden to Appellants to show why such a factual finding was erroneous.

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