MVS Filewrapper® Blog: StoneEagle v. Gillman – Patent Inventorship, Authorship, and Ownership

In StoneEagle Services, Inc.,v. Gillman the Federal Circuit confirmed that assistance in reducing an invention to practice generally does not contribute to inventorship. In this case, the issue centered on whether there was a sufficient controversy regarding inventorship for the case to remain in federal court.  The plaintiff alleged that the defendant had "falsely claimed that it is his patent, that he wrote the patent, that it is on his computer, and that he ‘authored’ or ‘wrote’ it, or words to that effect.” 

 

The court determined that the most favorable possible inference in favor of the plaintiff only indicated that the defendant assisted in constructively reducing an invention to practice by drafting the patent application.  The court confirmed that those activities confer no more rights of inventorship than activities in furtherance of an actual reduction to practice, which is usually insufficient to rise to the level of inventorship.  As the court concluded, if they were to hold otherwise, "patent attorneys and patent agents would be co-inventors on nearly every patent. Of course, this proposition cannot be correct."

 

The full decision is available here.

MVS Filewrapper® Blog: Means-Plus-Function Claims and Written Description for Priority

In EnOcean GMBH v. Face International Corp., the Federal Circuit vacated and remanded a final order of the U.S. Patent and Trademark Office (“PTO”) and the Board of Patent Appeals and Interferences (“Board”) with respect to EnOcean’s U.S. Patent Application No. 10/304,121.   The Federal Circuit held (1) the term “receiver” was recited with sufficient structure as to not invoke the means-plus-function requirements of 35 U.S.C. § 112, ¶ 6, and (2) the related German and PCT Applications recited a “receiver” such that one of ordinary skill in the art would understand the bounds of the invention as to allow the U.S. Application to claim the benefit of the German and PCT applications’ priority dates.

On June 25, 2010, the Board declared an interference between EnOcean and Face International—the real party of interest in U.S. Patent No. 7,084,529, directed at similar self-powered switches to those claimed in the EnOcean application.  After finding the claims of the ’529 Patent unpatentable under 35 U.S.C. § 103, the Board applied the presumption that the claims in EnOcean’s Application were also unpatentable.  EnOcean argued that the claims of its Application should be entitled to the filing date of its related German and PCT applications, which would antedate the cited art.  The Board held the claims of EnOcean’s Application were means-plus-function claims and were not entitled to the earlier priority date. 

On appeal, the Federal Circuit first examined the claims of EnOcean’s Application which read on “a signal receiver for receiving” and a “a receiver adapted to receiving” (the “receiver claims”).  The Federal Circuit disagreed with the Board’s finding that there is no distinction in meaning between ‘receiver’ and ‘signal receiving means,’” noting that the lack of the word “means” entitles the claims to a presumption that they are not means-plus-function claims and then cited to extensive evidence that one of skill in the art would sufficiently understand the structure defined by the term “receiver.” 

The Court then turned to the question of whether the written description of the German and PCT Applications were drafted with sufficient detail as to conclude that the inventor invented the claimed invention.  The Court decided that one of ordinary skill in the art would understand the bounds of the invention “merely by reading the term ‘receiver’” in the German and PCT Applications.  The Court further held that the Board’s requirement that the German and PCT Applications “expressly describe the structure of the receiver” applied the incorrect standard.

MVS Filewrapper® Blog: Patent Invalidity Based on Non-Compliant Claims of Priority

In Medtronic Corevalve, LLC v. Edwards Lifesciences Corp., the Federal Circuit affirmed summary judgment of invalidity of the asserted claims of U.S. Patent No. 7,892,281 ("the '281 patent") based on the patent's claimed priority date.  Medtronic sued Edwards for infringement of claims 3, 4, 7, 12, 14, and 15 of the '281 patent.  The U.S. District Court of the Central District of California granted summary judgment of invalidity to Edwards, holding the asserted claims of '281 patent were invalid as not being entitled to a priority date earlier than April 10, 2003.  The Federal Circuit affirmed the district court’s holding.

The '281 patent was filed on January 5, 2009 and issued on February 22, 2011.  It descended from a family of patents claiming priority to U.S., international, and French applications.  On its face, the '281 patent claims priority to French Application No. 99/14462 filed on November 17, 1999.  However, the asserted claims had proper priority to French Application No. 00/14028, filed on October 31, 2000.  The pertinent chain of priority was summarized by the Federal Circuit as follows:

Application

Serial Number

Filing Date

French App. 1b

French App. No. FR 00/14028

Oct. 31, 2000

International App. 2b

International App. No. PCT/FR01/03258

Oct. 19, 2001

U.S. App. 4

U.S. Patent App. Serial No. 10/412,634

Apr. 10, 2003

US. App. 6

U.S. Patent App. Serial No. 11/352,614

Feb. 13, 2006

U.S. App. 8

U.S. Patent App. Serial No. 12/029,031

Feb. 11, 2008

U.S. App. 10

U.S. Patent App. Serial No. 12/348,892

Jan. 5, 2009

 

Through the litigation, Edwards realized that the '281 patent had several defects in its chain of priority, including failure to comply with 35 U.S.C. §§ 119 and 120.  Edwards moved for summary judgment of invalidity of the asserted claims, on the basis "that these defects limited the priority date of the Asserted Claims to no earlier than April 10, 2003."  Based on the April 10, 2003 priority date, Edwards also moved to invalidate the Asserted Claims on summary judgment under 35 U.S.C. § 102 with earlier filed French Application [No. 00/14028] and [it’s related PCT Application.

The district court granted Edwards motion.  The court's decision rested on it finding that the claims to priority under §§ 119 and 120 were not in compliance with the statutory sections.  The district court noted that § 119 requires "that 'all intermediate applications in a priority chain contain a specific reference to the earlier-filed foreign application' from which priority is claimed."  Not every one of the intervening Medtronic applications in the priority chain did so.  Thus, the court held that the '281 patent was not in compliance with § 119 and priority could not be established any earlier than at least April 10, 2003.  With respect to § 120, the court "noted that under § 120, a later filed application may claim priority based on an earlier field application if, inter alia, the later filed application contains or is amended to contain a specific reference to the earlier filed application."  The district court found that applications within the  priority chain failed to comply with these requirements of § 120.  As such, the court held that the '281 patent was not in compliance with § 120 and priority could not be established any earlier than at least April 10, 2003.

Medtronic appealed the district court's decision.  The Federal Circuit affirmed the district court's grant of summary judgment.

MVS Filewrapper® Blog: Federal Circuit Clarifies Patent Term Adjustment

The U.S. Court of Appeals for the Federal Circuit has issued an opinion that provides guidance for how Patent Term Adjustments should be calculated.

Between June 2009 and May 2011, Novartis filed four civil lawsuits against the Director of the United States Patent and Trademark Office (PTO) in the United States District Court for the District of Columbia claiming that, for twenty-three of its issued patents, the Director had improperly determined the amount of patent term adjustment (PTA).  On February 16, 2012, the district court consolidated the cases.    

Novartis claimed that the Director’s determinations of the patent term adjustment were erroneous because they were based on two mistaken interpretations of the PTA statute as it applies to an applicant’s request for continued examination (RCE).   The District Court held that for the patents where review of PTA was applicable, the Director’s determinations were incorrect, and granted Novartis the additional patent term.  On appeal, the Federal Circuit court affirmed-in-part and reversed-in-part the District Court’s ruling, concluding that Novartis was entitled to most—but not all—of the additional patent term adjustment it sought.   

The portion of the PTA statute relevant to this case is set out in in 35 U.S.C. § 154(b).  This provision states:

 

if the issue of an original patent is delayed due to the failure of the United States Patent and Trademark Office to issue a patent within 3 years after the actual filing date of the application under section 111(a) in the United States or, in the case of an international application, the date of commencement of the national stage under section 371 in the international application, not including—

(i)      any time consumed by continued examination of the application requested by the applicant under section 132(b);

(ii)     any time consumed by a proceeding  under section 135(a), any time consumed by the imposition of an order under section 181, or any time consumed by appellate review by the Patent Trial and Appeal Board or by a Federal court; or

(iii)    any delay in the processing of the application by the United States Patent and Trademark Office requested by the applicant except as permitted by paragraph (3)(C), the term of the patent shall be extended 1 day for each day after the end of that 3-year period until the patent is issued.

Novartis asserted that the PTA it was granted on its patents was incorrect because the Director erroneously interpreted this provision to provide that (1) time spent in any continuing examination, no matter when initiated by the applicant, does not count towards tolling the statute’s three year allotment, and (2) both the time from initiation of continued examination to allowance and the time from allowance to issuance do not count toward tolling the three year allotment.  The Federal Circuit agreed with the PTO on the first issue and Novartis on the second.    

In finding that the Director's first interpretation of § 154(b) is correct, the court held that the best reading of the statute is that "the [PTA] time should be calculated by determining the length of the time between application and patent issuance, then subtracting any continued examination time and determining the extent to which the result exceeds three years."   The court concluded that this interpretation is fairest to the applicant while also conforming to the statute's purpose.

In ruling for Novartis on the second issue, the court determined that there is no basis in the statute for distinguishing a continued-examination case from a case not involving a continued examination.  As a result the court held that any time between allowance and issuance should count toward the PTO’s three year allotment, regardless of whether there has been any continued examination.  

The full opinion is available here.

MVS Filewrapper® Blog: Exhausting Patent Rights Without a "Sale"

In LifeScan Scotland, LTD v. Shasta Technologies, LLC, the Federal Circuit clarified the ability of a patnet holder to enforce patent rights in a product it has given away, but not "sold."  Defendant Shasta Technologies appealed from a decision of the United States District Court for the Northern District of California granting LifeScan Scotland a preliminary injunction.  The injunction prohibits Shasta from making, using, or selling blood glucose test strips. The District Court found that Shasta's strips likely indirectly infringed LifeScan's U.S. Patent No. 7,250,105 ("the '105 patent"). The '105 patent does not cover any corresponding test strips. Rather, the technology described in the '105 patent relates to an apparatus for measuring glucose. LifeScan manufactures a system called "OneTouch Ultra" blood glucose monitoring system, which uses this technology. LifeScan distributes 60% of its patented meters through health care providers, who in turn provide the meters to diabetic individuals for free.

   

Shasta does not sell or make blood glucose meters, but instead competes with LifeScan in the market for test strips. Shasta's "GenStrip" test strips are designed to work with LifeScan's meters. LifeScan's suit alleged that Shasta's GenStrip test strips indirectly infringed the '105 patent.  In turn Shasta claimed the sale and distribution of LifeScan's meters exhausted its rights under the method patent because the meters substantially embody the invention.

   

The District Court agreed with LifeScan, granting it a preliminary injunction. The District Court reasoned that patent exhaustion applies only to a "sale" where the patentee received "consideration" in exchange for the patented product. The district court concluded that because LifeScan did not receive consideration when it distributed the patented product, patent exhaustion does not apply.

   

On appeal, the Federal Circuit relied on Quanta Computer, Inc. v. LG Electronics, Inc., which holds that a method claim is exhausted by the sale of a product that "substantially embodies" the invention.  The appellate court also held, as a matter of first impression, that "[w]here a patentee unconditionally parts with ownership of an article, it cannot later complain that the approach that it chose results in an inadequate reward and that therefore ordinary principles of patent exhaustion should not apply."   As a result, LifeScan could not circumvent the application of patent exhaustion principles by distributing a product embodying the patent for free, and reversed the district court’s grant of a preliminary injunction.

   

MVS Filewrapper® Blog: New and Useful - August 26, 2013

·         In University of Utah v. Max-Planck-Gesellschaft, the Federal Circuit held that a patent lawsuit between a state university and the officers of another state university is not a controversy between two states.  The case began when the University of Utah (“UUtah”) sued the Max Planck Institute and the University of Massachusetts (“UMass”) to correct inventorship of two patents—U.S. Patent Nos. 7,056,704 and 7,078,196.  The basis of UUtah’s claim was that the named inventor of the patents—Dr. Thomas Tuschl, a UMass Professor—incorporated the ideas of a UUtah Professor—Dr. Brenda Bass—and did not name her as an inventor.  UMass argued that the dispute was between two states as both UUtah and UMass are state institutions.  This presents constitutional law questions.  In particular, two provisions of the Constitution are at issue, Article 3, §2, cl.2 and the 11th Amendment.  The 11th Amendment provides sovereign immunity to state governments from any cause of action brought by citizens of another state in Federal Court.  However, Article III of the Constitution provides for state-versus-state lawsuits, for which the United States Supreme Court has original jurisdiction.  Thus, under UMass’s argument, only the United States Supreme Court should have jurisdiction to hear the matter.  In response to UMass’s argument, UUtah amended its complaint and substituted UMass with four UMass officials as defendants.  The district court held that the action was no longer a state-versus-state action and could proceed.  Immediate appeal was heard by the Federal Circuit, which affirmed the district court in a 2-1 decision.  Judge Moore provided a notable dissent arguing that UMass is an indispensable party and should be a named defendant and the case is in fact a controversy between two states.

·         In Skinmedica v. Histogen, the Federal Circuit affirmed summary judgment of non-infringement.  Skinmedica asserted infringement of two of its patents covering methods for producing dermatological products containing “novel cell culture medium compositions.”  The Federal Circuit noted that “[d]uring prosecution of the ’494 patent, the inventors limited their claimed inventions to pharmaceutical compositions comprising cell culture medium conditioned by animal cells only in three-dimensions” in order to overcome an anticipation rejection.  Histogen cultures cells beginning with “one- or two-dimensional growth” on beads that “evolves into a three-dimensional growth phase in which the cells crawl off the beads.”  On appeal Skinmedica argued “that the district court erroneously excluded beads from the definition of ‘culturing . . . cells in three-dimensions.’”  The Federal Circuit, however, found no basis to overturn the district court’s construction of the phrase “culturing . . . cells in three-dimensions.”  This was because the patents-in-suit define “three dimensional culturing” to exclude beads by “expressly confin[ing] culturing with beads to two-dimensional culturing.”  In light of this, the Federal Circuit affirmed the district court’s grant of summary judgment of non-infringement. 

·         In Ex parte Mewherter, the Patent Trial and Appeal Board held that a software composition cannot meet the requirements of patentable subject-matter under § 101 unless the invention excludes transitory media such as signals and carrier waves.  Independent claim 16 was rejected under § 101.  Claim 16 recited in pertinent part, “A machine readable storage medium having stored thereon a computer program for converting a slide show presentation for use within a non-presentation application.”  The Examiner rejected the claim arguing that the phrase “machine-readable storage medium” encompassed transitory media “such as signals, carrier waves, etc.”  The patent Applicant—IBM—countered that the term “storage” differentiates the claimed invention from the non-patentable subject matter “machine-readable medium” because it requires permanent storage.  The Board, however, affirmed the Examiner’s rejection noting that the specification failed to exclude transitory signals from its definition of “machine-readable storage medium.”  As a result, the Board held that one of skill in the art would construe the term to encompass transitory media and not be limited exclusively to permanent storage media.

MVS Filewrapper® Blog: Supplier's Agreement to Manufacture May Trigger On-Sale Bar

In an Opinion on August 14, 2013 (Hamilton Beach Brands, Inc. v. Sunbeam Products, Inc.), the Federal Circuit ruled that the on-sale bar was triggered when a purchase order for slow cookers by patentee Hamilton Beach was confirmed by its supplier. The Court stated that Hamilton Beach’s transaction with its supplier was an offer for sale of a product that anticipated the asserted claims and that the invention was ready for patenting prior to the critical date.

Under § 102(b) (pre-AIA), a person shall be entitled to a patent unless "the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States." Note that, post-AIA, § 102(a)(1) includes similar language, but the Hamilton Beach patent falls under the pre-AIA rules. The on-sale bar invalidates a patent when the invention was sold or offered for sale more than one year prior to the filing date of the patent application. Although Hamilton Beach neither sold nor offered its invention for sale, the Federal Circuit considered the Hamilton Beach supplier's offer to manufacture the invention an offer for sale. The Court noted in its opinion that there is no "supplier exception" to the on-sale bar. Since the supplier's offer to manufacture the invention was more than one year prior to the patent application filing date, the Court ruled that the claims were invalid.

MVS Filewrapper® Blog: Federal Circuit Confirms Invalidity for Overbroad Written Description

Novozymes v. DuPont Nutrition Biosciences involved patent 7,713,723 directed toward recombinant Bacillus alpha-amylase enzymes engineered to have enhanced acid tolerance and heat tolerance.  The patent owner, Plaintiffs-Appellants Novozymes, sued DuPont for infringement.  DuPont defended on grounds of non-infringement and invalidity and countersued for a declaratory judgment that the '723 patent was invalid for failing to satisfying the enablement and written description requirements of 35 U.S.C. § 112.

Novozymes had identified thirty-three Bacillus alpha-amylase amino acid positions as targets for mutagenesis.  Novozymes filed a patent in 2000 for these variants with enhanced stability, specifying that any of the positions could be altered by deletion, addition, or substitution to create variants with improved stability.  Ultimately, the application included a wide range of potential variants without identifying any of the mutations as being preferred. Instead, it only offered two examples including one for the S239W mutation, which was found to be inoperable.

In 2006, DuPont began work on similar alpha-amylase variants and came up with mutations which overlapped with six of the amino acid positions identified in Novozymes' 2000 application.  This included position 239, but the Novozymes application did not disclose the particular substation used by DuPont, S239Q. DuPont obtained a patent (7,541,026) on the variant in 2009.

           

Shortly thereafter, Novozymes filed a continuation application with claims drawn specifically to variants substituted at position 239, which issued in 2009.  The specification of the continuation was essentially the same as the 2000 application.  The day the patent issued, Novozymes sued DuPont for infringement.

The main issue in this case was whether Novozymes satisfied the written description requirement for the claims at issue.  The Court quoted Ariad, which required that the written description "clearly allow person of ordinary skill in the art to recognize that [the invention] invented what is claimed."  The Court also noted that often in cases where a patent's written description disclosed an invention in terms of a broad genus but the claims were directed toward a specific species, there must be some indication to guide a reader towards preferred possibilities out of the group.

Novozyme cited Union Oil, a Federal Circuit case involving a gasoline composition claimed in terms of various chemical and physical properties instead of describing the individual components.  In that case it was decided that anyone having ordinary skill in the art would have produced a composition with those properties which performed the claimed invention and so the written description showed that the inventors possessed the claimed invention at the time of filing.

In contrast, while Novozyme's specification included a number of possible variants and offered some limitations, it did not point out any particular characteristics which would guide a reader to the claimed variant.  The Court determined that the 2000 application did not disclose any variant that satisfied the claims and the specification failed to show that Novozymes possessed such a variant at the time of filing.  The Court ultimately held that no reasonable jury could find that the claims of the '723 patent met the written description requirement of 35 U.S.C. § 112 and the district court properly invalidated the claims.

Chief Judge Radar dissented, stating that he would reverse the grant of judgment as a matter of law and reinstate the jury's verdict.  He noted that the jury had found that a skilled artisan would know how to arrive at the claimed invention by substituting amino acids.  Their decision was based on expert testimony which suggested that finding the claimed variants based on the specification was routine and would only take a week if you had a team of ten scientists making and testing all nineteen amino acid substitutions at each of the thirty-three amino acid positions.

Given the Federal Circuit's recent decision in Wyeth v. Abbott Laboratories, it seems that providing a large number of options of a genus in a patent description could lead to trouble, even if one with skill in the art could arrive at the claimed invention with routine experimentation.  The specification needs to provide some guidance to narrow down the possibilities and enable the reader to arrive at the claimed species without undue experimentation.

           

MVS Filewrapper® Blog: New and Useful - July 10, 2013

·         In Convolve v. Compaq Computer the Federal Circuit affirmed in part the United States District Court for the Southern District of New York ruling that Compaq Computer Corp., Seagate Technology, LLC., and Seagate Technology, Inc. did not misappropriate 11 of 15 alleged trade secrets from Convolve, Inc.  In addition, the Federal Circuit affirmed the district court’s judgment that 8 claims of U.S. Patent No. 4,916,635 (“the ’635 patent”) are invalid.  However, the Federal Circuit vacated the district court’s ruling that Compaq did not infringe several claims of U.S. Patent No. 6,314,473 (“the ’473 patent”), and remanded the case for further proceedings relating to that patent. 

Convolve and Massachusetts Institute of Technology (“MIT”) sued Compaq and Seagate for both trade secret misappropriation and patent infringement, all related to technology developed by Dr. Neil Singer while a graduate student at MIT.  The technology involves seeks in computer hard drives, and minimizing the vibrations created by those seeks—the ’635 patent discloses a method “for generating an input to a system to minimize unwanted dynamics in the system response and to reduce energy consumed by the system during moves,” and an apparatus for shaping commands to a system “to reduce endpoint vibration.” The ’473 patent covers the same type of technology, but relating specifically to data storage devices such as computer disk drives.  The ’473 patent is owned by Convolve, a company owned by Dr. Singer, and the ’635 patent is owned by MIT.  Convolve is the exclusive licensee of MIT software motion control technology called Input Shaping, which Convolve alleges is covered by the trade secrets and patents involved in the case. 

Convolve entered into licensing discussions with Compaq, which included a non-disclosure agreement (NDA) signed by both parties and covering confidential information disclosed between August 13, 1998 and October 15, 2000, but explicitly excluding any information that: (1) the recipient possessed prior to disclosure; (2) was a matter of public knowledge; (3) was received from a third party without a duty of confidentiality attached; (4) was independently developed by the recipient; (5) was disclosed under operation of law; or (6) was disclosed by the recipient with the discloser’s prior written approval.  The NDA further stated that any confidential material or presentations must be particularly identified as confidential.  Compaq sought to include Seagate as the potential designer and manufacturer of hard disk drives incorporating Convolve’s technology to include in Compaq’s computers.  Convolve then disclosed its technology to Compaq and Seagate, but Convolve and Compaq/Seagate never entered into a licensing agreement.

Convolve filed suit alleging breach of contract, misappropriation of trade secrets, patent infringement of the ’473 patent, ’635 patent and breach of good faith and fair dealing.  The district court granted Compaq and Seagate’s motions for summary judgment, dismissing Convolve’s claims of breach of contract, infringement of the asserted claims of the ’473 and ’635 patents, and misappropriation of a subset of the trade secrets asserted against Compaq and Seagate; and granting Seagate’s motion for summary judgment for invalidity of the ’635 patent.  

Regarding the alleged trade secrets, the Federal Circuit upheld the district courts findings and judgment that Compaq and Seagate had not misappropriated 7 of the asserted trade secrets because Convolve disclosed the information in the absence of a written confidentiality follow-up memorandum mandated by the NDA.  The Federal Circuit also affirmed the district court’s ruling that 6 of the asserted trade secrets were either generally known before any disclosure by Convolve or were not used by Seagate following any disclosure by Convolve.  Further, the court rejected Convolves argument that Seagate’s actions constituted trade secret misappropriation under the California Uniform Trade Secret Act notwithstanding the NDA, concluding that where the parties have contracted the limits of their confidential relationship regarding a particular subject matter, one party should not be able to circumvent its contractual obligations or impose new ones over the other via some implied duty of confidentiality.

The Federal Circuit vacated the district court’s grant of summary judgment to Seagate and Compaq for non-infringement of the asserted claims of the ’473 patent, concluding that there were material issues of fact that precluded a grant of summary judgment  as to direct or indirect infringement.  The court also concluded that there was sufficient evidence to preclude summary judgment for induced infringement on the basis of the court’s recent holding in Toshiba Corp. v. Imation Corp. that when an alleged infringer instructs users to use a product in an infringing way, there is sufficient evidence for a jury to find direct infringement.

·         The Federal Circuit in Wyeth v. Abbott Laboratories upheld the U.S. District Court for the District of New Jersey's grant of summary judgment that claims 1 and 2 of U.S. Patent No. 5,516,781 and claim 1 of U.S. Patent No. 5,563,146 are invalid for nonenablement.  The patents relate to the use of rapamycin for the treatment of restenosis.  The patents disclosed use of the rapamycin species sirolimus to reduce thickening of arterial walls.  Wyeth sued the defendants for patent infringement for their products that elute everolimus and zotarolimus.  These compounds fall under the umbrella of rapamycin, but are not mentioned in the specification of the Wyeth patents.

The main issue on appeal was whether practicing the full scope of the claims requires excessive experimentation.  The specification describes assays used to determine whether a potential rapamycin compound exhibits the desired characteristics of immunosuppressive and antirestenotic effects.  Wyeth argued that even though millions of compounds would meet these criteria, one of skill in the art would know that an effective compound had to be small enough to permeate cell membranes.  However, that still leaves tens of thousands of compounds to test and the specification gave no indication of which types of rapamycin compounds would be preferable over others, leaving scientists to synthesize and screen each and every compound. 

While synthesizing and screening compounds is considered routine experimentation, the Court noted in Cephalon, Inc. v. Watson Pharm., Inc. that routine experimentation is "not without bounds."  One indication of excessive experimentation is length of time that would be spent to do the experiments.  Wyeth's expert admitted that it would take technicians weeks to complete each of the assays. 

A final indicator that the invention is not enabled is the unpredictability of the field.  Simply offering a starting point for further research in field like organic chemistry does not properly enable an invention.  Due to the uncertainty, there needs to be more concrete guidance given in the specification in order to avoid undue experimentation.

Ultimately, the Federal Circuit determined that synthesizing and screening tens of thousands of candidate compounds constituted undue experimentation.  While they did not draw a definitive line between routine experimentation and undue experimentation, the Court did provide some guidance on what could be considered excessive experimentation in organic chemistry.

·         In Commil USA v. Cisco Systems, Cisco Systems appealed a district court final judgment in favor of Commil, asserting that the district court gave erroneous jury instructions, improperly precluded Cisco from presenting evidence of good-faith belief of invalidity, and abused its discretion by granting a new partial trial.  On appeal, the Federal Circuit found that the district court gave erroneous instructions to the jury with respect to indirect infringement and that evidence of a good-faith belief of invalidity may negate the intent required to show induced infringement.  The Court determined that the district court did not err in granting the partial new trial.

In regard to the issue of indirect or induced infringement, the jury had been instructed in part that to show induced infringement, "Cisco knew or should have known that its actions would induce actual infringement."  In light of the Supreme Court's decision in Global-Tech Applicances, Inc. v. SEB S.A., which held that induced infringement "requires knowledge that the induced acts constitute patent infringement," a finding of induced infringement may no longer be based on recklessness or negligence.  As such, the Federal Circuit concluded that the jury instructions were erroneous as a matter of law.  The Court found that this erroneous instruction could have changed the result of the trial.  Due to the prejudicial effect of the jury instruction, the Court vacated the verdict of induced infringement and remanded for a new trial. 

With respect to invalidity, Cisco had provided evidence to support its good-faith belief that the patent at issue was invalid.  However, the district court granted Commil's motion in limine to exclude that evidence.  Federal Circuit case law has shown that evidence of a good-faith belief of non-infringement tends to show that an accused inducer of infringement lacked the requisite intent.  Similarly, the Court in this case found that a good-faith belief of invalidity serves the same purpose as a good-faith belief of non-infringement as far as specific intent is concerned.  The Court noted that "one could be aware of a patent and induce another to perform the steps of the patent claim, but have a good-faith belief that the patent is not valid.  Under those circumstances, it can hardly be said that the alleged inducer intended to induce infringement."  The Federal Circuit ultimately held that a good-faith belief of invalidity can negate the specific intent required for induced infringement.

Judge Newman dissented with regard to this portion of the ruling, finding that the Court had changed the law of induced infringement.  She stated that a good-faith belief in invalidity does not avoid liability for infringement because infringement in fact does not depend on the belief of the accused infringer.  Judge Newman relied on tort theory to support her position that "A mistake of law, even if made in good faith, does not absolve a tortfeasor."

With respect to the decision to grant a partial new trial on the issues of indirect infringement and damages, the Federal Circuit determined that it did not violate the Seventh Amendment because the issues were distinct and separable.  The jury in the partial trial was asked to determine whether Cisco possessed a good-faith belief of invalidity, but not whether the patent was in fact invalid.  Cisco argued that these issues are intertwined, but the Court determined that they could be separate issues. 

Judge O'Malley disagreed with this part of the decision, believing that Cisco was deprived of its right to a jury trial under the Seventh Amendment.  She noted that because statements by Cisco's counsel were prejudicial towards the Jewish inventors of Commil, the entire trial was affected.  As a result, Commil was entitled to an entire retrial of all of the issues instead of a partial new trial.

MVS Filewrapper® Blog: New and Useful - July 8, 2013

·         The Federal Circuit in Ultramercial, Inc. v. Hulu, LLC held that the district court erred in holding that the subject matter of U.S. Patent No. 7,346,545 ('545) is not a "process" within the language and meaning of 35 U.S.C. § 101.  The Federal Circuit reversed and remanded this case stating the claims were not abstract and were patent eligible.

The '545 patent claims a method for distribution of copyrighted products over the Internet where the consumer receive the product for free in exchange for viewing an advertisement, and the advertiser pays for the copyrighted content.  In other words, it is a method for monetizing and distributing copyrighted products over the Internet.

Ultramercial originally sued Hulu, LLC ("Hulu"), YouTube, LLC ("YouTube"), and WildTangent, Inc. ("WildTangent"), alleging infringement of the '545 patent.  Hulu and YouTube were later dismissed from the case.  WildTangent then moved to dismiss for failure to state a claim under Rule 12(b)(6).  The United States District Court for the Central District of California granted the dismissal holding that patent '545 did not claim patent-eligible subject matter.  The Federal Circuit had previously reversed the district court's holding and remanded the case, but that earlier decision was vacated by the United States Supreme Court. 

The district court’s grant of the motion to dismiss was based on its conclusion that there was no reasonable construction that would render the subject matter patent-eligible.  The Federal Circuit took issue with this approach, and explained that inquiries into patent-eligibility under § 101 would often involve factual questions, and that claim construction would often be necessary.   In this case, the Federal Circuit determined that the factual determinations were key to deciding eligibility, and that a construction most favorable to the patentee should be applied. 

In its analysis, the Federal Circuit reiterated that under the “abstract ideas” limitation to patent-eligibility of 35 U.S.C. § 101, a claim is not patent eligible only if, instead of claiming an application of an abstract idea, the claim is instead to the abstract idea itself.  A claim may be premised on an abstract idea and, indeed, the abstract idea may be of central importance to the invention—the question for patent eligibility is whether the claim contains limitations that meaningfully tie that abstract idea to an actual application of that idea through meaningful limitations.  In determining if the claim is abstract or not, the court must look at the claim as a whole and "cannot go hunting for abstractions by ignoring the concrete, palpable, tangible limitations of the invention the patentee actually claims."

The Federal Circuit looked to the Supreme Court for guidance on discerning whether or not a claim is an abstraction.  First, the Supreme court in Prometheus stated that a claim is not meaningfully limited if it merely describes an abstract idea or in essence simply adds the words "apply it."  Second, a claim is invalid if the subject matter preempts all practical uses of an abstract idea.  In other words, a claim is invalid if it covers every practical application of that abstract idea.  Finally, the Supreme Court in Prometheus stated "that a claim is not meaningfully limited if its purported limitations provided no real direction, cover all possible ways to achieve the provided result, or are overly-generalized."

With this guidance in mind, the Federal Court held that the claims of '545 were patent eligible and not invalid under § 101.  The court noted that by its terms, patent '545 invokes computers and applications of computer technology.  Even without claim construction, several of the steps require that the method be performed though computers, on the internet, and in a cyber-market environment.  Further, if the products are offered for sale on the internet, they must be restricted by complex computer programming as well.  Viewing the subject matter as a whole, the invention recites a process, it does not pre-empt all use of the abstract idea, the recited steps are not all pre- or post-solution steps, and the claim is not overly generalized.  The claims also do not involve a mathematical algorithm, a series of purely mental steps, or any similarly abstract idea.  Thus the claims of patent '545 were found to be patent-eligible.  

  

·         In Authors Guild v. Google Inc., the Second Circuit vacated a class certification by the United States District Court for the Southern District of New York, and remanded the case back for further consideration, without prejudice to any renewal of the motion for class certification.

The suit commenced in 2005 when The Authors Guild, an association of authors, and several individual authors sued Google alleging copyright infringement by Google Books.  Google Books would scan and index books and make short snippets of the books available for public viewing without payment to the authors.

Following a course of discovery and settlement agreements, both parties moved for an approval of an amended proposed class settlement agreement.  After the court refused the motion, the plaintiff moved to certify a proposed class of "[a]ll persons residing in the United States who hold a United States copyright interest in one or more books reproduced by Google."  The district court allowed the certification.  Google opposed the motion for class certification and appealed the District Court's grant of class certification to the Second Circuit.  In its appeal, Google stated they intended to raise a "fair use" defense, which might moot the litigation.  Google also raised the defense that the class representatives do not adequately protect the interests of the class as a whole.

The appellate court set aside Google's second defense and chose to just focus on the fair use argument, stating "the resolution of Google's fair use defense in the first instance will necessarily inform and perhaps moot our analysis of many class certification issues."  The court believed that Google's fair use defense should be fully resolved before questions regarding class certification are decided on.  The court vacated the District Court's decision to allow certification of the proposed class and remanded the case back for consideration of the fair use issues, without prejudice to any renewal of the motion for class certification.

·         In Fresenius USA v. Baxter Inter'l, the Federal Circuit decided whether the cancellation of the asserted claims by the United States Patent and Trademark Office ("PTO"), pursuant to the agency's statutory reexamination authority, must be given effect in pending infringement litigation.  The Federal Circuit held that it did, and dismissed the district court's decision and remanded with instructions to dismiss.

The case commenced when Fresenius USA and Fresenius Medical Care Holdings (collectively, "Fresenius") brought a declaratory judgment action against Baxter International and Baxter Healthcare Corporation (collectively "Baxter") alleging that claims of U.S. Patent No. 5, 247, 434 ('434) were invalid and not infringed.  Baxter counterclaimed for infringement.  The district court found in favor of Baxter that Fresenius infringed the claims and that the claims were not invalid.  The Federal Circuit affirmed the district court's ruling, but remanded to reconsider its injunction and post-verdict damages.

While the litigation was pending on remand to the District Court, the PTO completed a reexamination of the patent and determined that all asserted claims were invalid.  After the PTO made its determination, the district court entered judgment against Fresenius in the pending infringement proceeding.  On appeal, Fresenius argued that Baxter no longer had a cause of action because the PTO gave its ruling before the district court gave theirs.

The reexamination statute of 1928 authorized the PTO to reconsider patents of "doubtful" validity, and to cancel "defectively examined and therefore erroneously granted patents."  Looking at the language and legislative history, the court noted that reexamination is supposed to occur concurrently with litigation, and that cancellation of claims during reexamination would be binding on concurrent infringement litigation.  After looking at all applicable precedent, the court concluded that if the PTO confirms the original claim in identical form, a suit based on that claim may continue, but if the original claim is cancelled or amended to cure invalidity, the patentee's cause of action is extinguished and the suit would fail.

Baxter contends that this rule does not apply to the present case because their case was conclusively decided before PTO gave their decision.  The Federal Circuit disagreed. The court stated that their original decision was not sufficiently final as to immunize it from the PTO's decision.  The court's original decision left open many aspects that still needed to be decided upon by the lower court.  The court explained "it is well-established that where the scope of relief remains to be determined, there is no final judgment binding the parties or the court."  For the PTO's decision to have no effect, a final decree must have been given, leaving nothing further to be done except the execution of it.  Since the PTO invalidated the claims before the lower court decided the injunction and post-verdict damages issues, Baxter no longer had a cause of action and the suit would fail.

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