This Thursday, the Federal Circuit will hear oral arguments en banc in In re Bilski (No. 2007-1130), a case that will help define the scope of patentable subject matter.  Numerous amicus briefs have been filed in the case, and perhaps most interestingly, two of the amici, Bank of America and Regulatory DataCorp, have been granted permission to participate in the oral arguments.

More information about the case and its possible implications after the jump.

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The Federal Circuit has, on its own motion, decided to hear a case en banc regarding the scope of patentable subject matter under § 101.  The case, In re Bilski (No. 2007-1130), was argued before a panel of the court on October 1, 2007, and deals with the patentability of methods that involve only mental steps.   Most interestingly, however, is that in the court's decision to hear the case en banc, the court asked the parties to brief the question:

Whether it is appropriate to reconsider State Street Bank & Trust Co. v. Signature Financial Group, Inc., 149 F.3d 1368 (Fed. Cir. 1998), and AT&T Corp. v. Excel Communications, Inc., 172 F.3d 1352 (Fed. Cir. 1999), in this case and, if so, whether those cases should be overruled in any respect? 

Given that the court may reconsider State Street, this case could potentially result in a major shift in the scope of patentable subject matter.  This decision comes on the heels of the court's decision earlier this week not to rehear In re Nuijten en banc, another case involving the scope of patentable subject matter.  The petition to rehear that case en banc was supported by several amici.

To read the full order, click here.  Patently-O has a good description of the BPAI's "informative" decision that is on appeal here.  Click below for the full list of questions presented for en banc review.

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In a precedential order today, the Federal Circuit denied a petition for rehearing en banc in In re Nuijten.  In that case, a panel of the court held that claims drawn to a "signal" did not fall into any of the statutory categories of patentable subject matter and were thus unpatentable under § 101.  Judge Linn dissented from that decision, applying the § 101 framework from Diamond v. Chakrabarty, and would have held the claims to be drawn to statutory subject matter.  You can read our full post about the panel's decision here.

Today Judge Linn authored the dissent again, this time joined by Judges Newman and Rader.  As in his previous dissent, Judge Linn referred to Diamond v. Chakrabarty.  He argued that under Chakrabarty, the signals claimed here were patentable subject matter. Not only does the decision conflict with Chakrabarty, he also asserted that a CCPA case, In re Breslow, also conflicted with the panel's decision.  There, the court held that claims directed toward chemical compounds that were known to exist but could not be isolated because they were too unstable were considered "article[s] of manufacture" as defined by § 101.  As stated by the CCPA:

It appears to us that the PTO would read into § 101 a requirement that compositions of matter must be stable—which is a relative term to say the least. We see no good reason to do so. It would appear that many compounds may find their greatest or even their sole utility in the fact that they are not stable. Certainly, in the invention at bar there is no reason to have the claimed compounds in a stable form so they can be bottled or tanked or otherwise stored. The preferred manner of using them is to produce them in situ, whereupon they exhibit their cross-linking activity, their only disclosed utility.

Here, the signals were "fleeting" or "transient," but Judge Linn argued that under Breslow, this did not matter for purposes of § 101. 

Further, he argued the distinction between claims that were found to be drawn to patentable subject matter, namely claims to storage medium containing the signals at issue, and claims to the signals themselves, was "artificial at best."

It appears likely that a petition for certiorari to the Supreme Court will be filed in this case.  This is further supported by the fact that in its last case dealing with § 101, Laboratory Corp. v. Metabolite Laboratories, Inc., the Court dismissed the petition for certiorari as improvidently granted, a decision that sparked three justices to dissent, showing that the Court may be looking for a case that presents a vehicle to rein in the scope of § 101.

To read the order in In re Nuijten, click here.

The Federal Circuit today granted a petition for rehearing en banc in a design patent case, Egyptian Goddess, Inc. v. Swisa, Inc.  In that case, the court held that when a design patent's "point of novelty" is a combination of existing design elements, the point of novelty must be a "non-trivial" advance over the prior art.  This essentially incorporated an obviousness-type inquiry into the infringement analysis, as in order to infringe a design patent, the allegedly infringing article must incorporate a point of novelty of the patented design.

Judge Dyk dissented, arguing that the new test conflated the tests for design patent validity and infringement.

Update (11/27):  A copy of the order granting rehearing en banc is availble here.  According to the order, there are three issues to be considered:

1. Should "point of novelty" be a test for infringement of design patent?
2. If so, (a) should the court adopt the non-trivial advance test adopted by the panel majority in this case; (b) should the point of novelty test be part of the patentee's burden on infringement or should it be an available defense; (c) should a design patentee, in defining a point of novelty, be permitted to divide closely related or, ornamentally integrated features of the patented design to match features contained in an accused design; (d) should it be permissible to find more than one "point of novelty" in a patented design; and (e) should the overall appearance of a design be permitted to be a point of novelty? See Lawman Armor Corp. v. Winner Int'l, LLC, 449 F.3d 1190 (Fed. Cir. 2006).
3. Should claim construction apply to design patents, and, if so, what role should that construction play in the infringement analysis? See Elmer v. ICC Fabricating, Inc., 67 F.3d 1571, 1577 (Fed. Cir. 1995).
   

It is interesting that the court is considering completely scrapping both the point of novelty test and the concept of claim construction in the context of design patents.  In any event, it is good that the court is reconsidering its holding in Lawman Armor, as that case has caused considerable controversy (see here and here for examples), and resulted in the court issuing a supplemental opinion to clairfy its original ruling.

More detail on the case may be found in our original post here.

Patently-O provides this report.  I/P Updates offers thoughts on the case here.

In a unanimous en banc decision issued late yesterday afternoon, the Federal Circuit granted a petition for mandamus requested by a party who was ordered by a district court to produce attorney-client privileged and work product protected material of its trial counsel, and to permit deposition of its trial counsel.  The order was entered after the defendant disclosed it would rely upon an opinion of counsel as a defense to willful infringement; the district court held that the waiver of attorney-client privilege and work product protection extended to the work trial counsel performed relevant to the opinions (a full recitation of the underlying facts can be found in this post.)

The Federal Circuit disagreed, and held that in most circumstances, such material will remain protected assuming trial counsel and opinion counsel are different.  The court went a step further, however, and decided to overrule its 1983 decision in Underwater Devices Inc. v. Morrison-Knudsen Co., which established that once a party had notice of a patentee's rights, that party had an affirmative duty of care to avoid infringement of the patent.  One way companies could comply with this duty was to obtain a competent opinion of counsel that the patent was either invalid or not infringed.

The Federal Circuit unanimously abrogated the affirmative duty of care.  The court adopted a recklessness standard for willful infringement, holding that to act "willfully," an infringer must act "despite an objectively high likelihood that its actions constituted infringement of a valid patent."  The risk must also be "known or so obvious that it should have been known to the accused infringer."

More detail of In re Seagate Tech., LLC after the jump.

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This Thursday, the Federal Circuit will sit en banc to hear oral argument in In re Seagate Technology LLC, a mandamus case regarding a district court's order to produce certain attorney-client privileged materials.  (Update (6/7): the audio of the oral argument is now available online at this link.)  Like in many patent cases, one of the defendants, Seagate, chose to obtain an opinion from counsel regarding noninfringement and invalidity of the asserted patents in order to defend itself from a charge of willful infringement.  The district court, however, found that a subject matter waiver of attorney-client privilege occurred when the opinions were disclosed, and granted a motion to compel stating:

Seagate shall produce all documents, answers to interrogatories, and deposition testimony concerning communications between Seagate (or its in-house counsel) and any of its attorneys, including trial counsel, with respect to the subject matter of Mr. Sekimura's opinions, i.e., the infringement, validity, and enforcement of the '635, '267, and '473 patents.

(emphasis added).  The order further required that trial counsel's advice regarding infringement, validity, and enforceability "must be disclosed even if it [was] communicated in the context of trial preparation." Thus, the court essentially ordered Seagate to produce its trial strategy, if requested, because of the subject matter waiver of privilege.

This case is even more interesting because the court, sua sponte, raised the issue of whether the court should reconsider the duty of care established in the court's 1983 Underwater Devices decision in light of its effect on attorney-client privilege.

More thoughts on the upcoming argument after the jump.

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The Federal Circuit this afternoon agreed to hear a case to determine the scope of the waiver of attorney-client privilege when advice of counsel is used to defend against a charge of willful infringement. The order in In re Seagate Technology, LLC, which can be found here, invites the parties to brief the following questions:

(1) Should a party's assertion of the advice of counsel defense to willful infringement extend waiver of the attorney-client privilege to communications with that party's trial counsel? See In re EchoStar Commc'n Corp., 448 F.3d 1294 (Fed. Cir. 2006).

(2) What is the effect of any such waiver on work-product immunity?

(3) Given the impact of the statutory duty of care standard announced in Underwater Devices, Inc. v. Morrison-Knudsen Co., 717 F.2d 1380 (Fed. Cir. 1983), on the issue of waiver of attorney-client privilege, should this court reconsider the decision in Underwater Devices and the duty of care standard itself?

The Federal Circuit resolved a perceived conflict in its case law regarding the necessary level of intent required for a defendant to be found liable for inducing infringement of a patent. The court considered one subsection of DSU Medical Corp. v. JMS Co. en banc to resolve the conflict.

The court held that to prove the intent necessary for liability for inducing infringement, there must be "evidence of culpable conduct, directed to encouraging another's infringement, not merely that the inducer had knowledge of the direct infringer's activities."

More details of the case after the jump.

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