In Biosig Instruments, Inc. v. Nautilus, Inc., the Federal Circuit reversed a decision by the U.S. District Court for the Southern District of New York finding a patent invalid for indefiniteness, relying on intrinsic evidence.  Biosig Instruments, Inc. (“Biosig”) is the assignee of U.S. Patent No. 5,337,753 (“the ’753 patent”).  The ’753 patent is directed to a heart rate monitor for use with exercise equipment and exercise procedures.  Biosig sued Nautilus, Inc. (“Nautilus”) for patent infringement alleging that claims 1 and 11 of the ’753 patent were infringed by Nautilus’s exercise equipment that has a mounted heart rate monitor. 

In the late 1990s, Biosig was in negotiations with Stairmaster Company—Nautilus’s predecessor—regarding Biosig’s patented technology, but the companies failed to reach an agreement.  Stairmaster, and eventually Nautilus, started to sell exercise equipment with mounted heart rate monitors.  Biosig sued Nautilus in August 2004, alleging that the equipment infringed its patent.  Following reexaminations and re-filed patent infringement suits, the District Court for the Southern District of New York eventually conducted a Markman hearing on the asserted claims of the ’753 patent in September 2011.  Among the terms the court construed was the term “spaced relationship.”  The district court construed the term to mean that “there is a defined relationship between the live electrode and the common electrode on one side of the cylindrical bar and the same or a different defined relationship between the live electrode and the common electrode on the other side of the cylindrical bar.”  Following the district court’s claim construction, Nautilus moved for summary judgment of non-infringement and invalidity for indefiniteness.

In February 2012, the district court ruled on the summary judgment motions, denying the motion for summary judgment of non-infringement and granting the motion for invalidity based on indefiniteness.  The district court’s holding of invalidity for indefiniteness was founded on the conclusion that the term “spaced relationship” was ambiguous, despite the fact that the court had construed the term in its Markman order.  Biosig appealed the district court’s grant of summary judgment, with the sole issue on appeal being the indefiniteness of “spaced relationship.” 

On appeal, the Federal Circuit’s analysis began with a summary of the standards of indefiniteness, stating “[a] claim is indefinite only when it is ‘not amenable to construction’ or ‘insolubly ambiguous.’”  The Court went on to discuss words of degree, for which “the court must determine whether the patent provides ‘some standard for measuring that degree.’”  In this instance, the Court concluded that the term was not indefinite, as it “was amenable to construction,” whereas “indefiniteness . . . would require a showing that a person of ordinary skill would find ‘spaced relationship’ to be insolubly ambiguous—that it fails to provide sufficient clarity delineating the bounds of the claim to one skilled in the art.”  The Federal Circuit specifically relied on the intrinsic evidence that the district court used in construing the term in its Markman order.  In doing so, the Federal Circuit noted that the specification described the “spaced relationship” of the electrodes in terms of their function, and cited the evidence submitted during the reexamination, including a declaration by the inventor, used to traverse a rejection by the USPTO.  In light of the specification and intrinsic evidence, the Federal Circuit held that the term “spaced relationship” was not indefinite; and therefore, that the grant of summary judgment was in error.  Accordingly, the Federal Circuit reversed the district court’s invalidity determination and remanded the case for further proceedings.

·         In U.S. Polo Assoc., Inc. v. PRL USA Holdings, Inc., the Second Circuit Court of Appeals found that the natural zone of expansion doctrine did not permit the United States Polo Association (“USPA”) to expand its offerings into a line of fragrances and affirmed the district court’s entry of a permanent injunction prohibiting such use.  The USPA filed a declaratory judgment to approve use of its Double Horseman mark, accompanied by the words “U.S. POLO ASSN.,” “USPA,” and/or “1890,” in the sale of men’s fragrances.  PRL counterclaimed, seeking entry of a permanent injunction precluding such use—which the district court granted.  USPA’s argument was centered on the, so called, natural zone of expansion doctrine.  USPA argued that its history of selling branded apparel provided it with the right to expand into related markets, i.e., apparel sales give rise to the right to expand into fragrances.  The district court gave little weight to USPA’s survey and found that PRL’s survey gave strong evidence of a likelihood of confusion.  The Second Circuit found that the district court’s holdings regarding the survey evidence did not abuse its discretion and that the previous litigation and USPA’s history did not support USPA’s argued natural right to expand.

·         In Function Media, L.L.C. v. Google, Inc., the Federal Circuit Court of Appeals held that the denial of a pre-trial motion for summary judgment of non-infringement is not sufficient to show that the district court delegated claim construction to the jury.  Function Media (“FM”) sued Google for infringement of three patents directed at “facilitate[ing] advertising on multiple advertising outlets such as newspapers and websites.”  Slip op. at p. 2.  The district court held that one patent was invalid for being indefinite “because the specification did not disclose sufficient structure for its sole independent claim’s means plus function term ‘means for transmitting.’”  Id. at pp. 5–6 (citations omitted).  A jury found the asserted claims in other two patents invalid and not infringed.  FM moved for judgment as a matter of law (“JMOL”) that the claims were not invalid, which the district court granted with respect to four claims.  This did not alter the jury verdict of non-infringement. 

FM appealed on a number of grounds, including an assertion that the district court gave the claim interpretation to the jury.  The argument was based on the fact that the district court denied Google’s motion for summary judgment of non-infringement. FM argued that the denial of summary judgment demonstrated that there were unresolved issues regarding claim scope, which were subsequently left to the jury rather than construed by the court.  The Federal Circuit did not agree that the district court improperly gave the claim interpretation to the jury, the Federal Circuit stated, “We hold that the denial of a pre-trial motion for summary judgment of non-infringement does not, by itself, show that the district court delegated claim construction to the jury.  This is especially true where, as here, the jury was instructed to apply the district court's claim constructions.”  Id. at pp. 21–22. 

·         In Cephalon, Inc. v. Watson Pharma., Inc. , the Federal Circuit Court of Appeals reversed a district court’s holding of invalidity for lack of enablement stating, “Watson failed as a matter of law to show with clear and convincing evidence that Cephalon’s patents require undue experimentation to practice the invention.”  Slip op. at p. 2.  Throughout the discussion of enablement, the Federal Circuit highlighted that the burden is on Watson to show lack of enablement—undue experimentation—and to do so by clear and convincing evidence.  The district court’s analysis was that, “the disclosures lacked teachings directed to formulating and co-administering two separate dosage forms . . . to achieve an effervescent reaction.  The lack of disclosure of such methods of co-administration would, according to the court, necessitate undue experimentation to practice the invention.”  Id. at p. 11 (citations omitted).  Watson merely provided “[u] nsubstantiated statements indicating that experimentation would be ‘difficult’ and ‘complicated.’”  Id. at pp. 15–16.  The Federal Circuit found that these statements did not meet the standard of clear and convincing evidence to establish undue burden as opposed to reasonable experimentation.  As such, the Federal Circuit reversed the district court’s holding of invalidity and remanded.

·         The United States Patent and Trademark Office published the final rules and guidelines governing First-Inventor-to-File.  (http://www.uspto.gov/news/pr/2013/13-10.jsp)  There were two separate Federal Register publications and each is briefly discussed below.  A more thorough discussion of each is forthcoming.

o   Changes to Implement First Inventor to File Provisions of Leahy-Smith America Invents Act

This publication sets forth the changes that will be necessary to implement the First-Inventor-to-File standards.  It addresses changes regarding each of the following:

§  The addition of definitions in the AIA to the rules of practice;

§  The submission of affidavits or declarations regarding:  disclosures in priority disputes under the first-to-file standards and prior public disclosures;

§  Standards regarding a U.S. Patent or Published Applications having a prior art effect as of the filing date of a foreign priority application;

§  Elimination of the provisions regarding statutory invention registrations; and

§  Adoption of requirements for nonprovisional applications filed on or after March 16, 2013, that claim priority to or the benefit of the filing date of an application filed prior to March 16, 2013.

o   Examination Guidelines for Implementing First Inventor to File Provisions of Leahy-Smith America Invents Act

This publication sets forth the changes the changes to the examination guidelines under the First-Inventor-to-File standard.  The publication is also meant to clarify and respond to questions provided during the public comment period regarding whether there is a requirement that the mode of disclosure by an inventor or joint inventor be the same as the mode of disclosure of an intervening disclosure.

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 recent decision, the Federal Circuit affirmed a district court's finding of inequitable conduct for one patent but reversed on a second, affirmed a finding of no invalidity of the second patent, but vacated the finding of infringement after modifying the district court's claim construction of a claim term.  The court also reversed the finding of indefiniteness of a third patent.

The court continued its recent discussions of when (if ever) an inference of intent to deceive is permissible to support an inequitable conduct finding where there is no independent evidence of such intent.  Here, the majority affirmed the district court's inference of intent based on high materiality, proof of knowledge of the withheld art, and a lack of credible explanation for the nondisclosure.  Judge Lourie dissented, arguing the majority conflated intent with materiality.  Given the apparent disagreement  on this issue, a case presenting the issue of when (or whether) such an inference is permissible seems to be a candidate for en banc review.

More detail of Praxair, Inc. v. ATMI, Inc. after the jump.

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In a recent decision, the Federal Circuit reversed a district court's grant of summary judgment of inequitable conduct against the patentee.  At issue was whether the patentee's failure to disclose a letter describing an aspect of the prior art constituted inequitable conduct.  The court reversed finding that the alleged infringer had failed to provide sufficient facts to support an inference of intent to deceive.

The defendant's theory involved a plan by the patentee to switch law firms once it appeared the first firm intended to disclose the letter, and preventing the second firm from discovering the existence of the letter.  The opinion provided a clear look of how the Federal Circuit will analyze inequitable conduct.  The court teed up its analysis by stating:

To successfully prove inequitable conduct, the accused infringer must present "evidence that the applicant (1) made an affirmative misrepresentation of material fact, failed to disclose material information, or submitted false material information, and (2) intended to deceive the [PTO]."  Further, at least a threshold level of each element -- i.e., both materiality and intent to deceive -- must be proven by clear and convincing evidence.  And even if this elevated evidentiary burden is met as to both elements, the district court must still balance the equities to determine whether the applicant's conduct before the PTO was egregious enough to warrant holding the entire patent unenforceable.  Thus, even if a threshold level of both materiality and intent to deceive are proven by clear and convincing evidence, the court may still decline to render the patent unenforceable.

Most important to the court was that an accused infringer proves threshold levels of intent to deceive the PTO and materiality with clear and convincing evidence. The clear and convincing standard requires that the evidence be strong enough to show that an inference of intent to deceive is the "single most reasonable inference able to be drawn from the evidence."  In this case, there was simply "no evidence, direct or indirect," to support the inference the defendant sought to draw.  As a result, the finding of inequitable conduct was reversed.

More on Star Scientific, Inc. v. R.J. Reynolds Tobacco Co. after the jump.

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In a recent decision, the Federal Circuit reversed a jury verdict of willful infringement and a total award of over $100 million based on a modified claim construction.  The court also reversed the finding that one asserted claim was not anticipated, and remanded the case for a redetermination of infringement and whether the remaining claims were valid.

The court considered two competing constructions of the same claim terms, one by the district court in this case, and another by a second district court in an unrelated case involving the same patent.  The Federal Circuit found the second district court's construction to be the proper one, and therefore reversed the construction on appeal (and the related finding of infringement).

More detail of Finistar Corp. v. DirecTV Group, Inc. after the jump.

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In a decision last week, the Federal Circuit decided a case addressing the limitations of what constitutes "insolubly ambiguous" claim terms in order to amount to indefiniteness.  The district court held the asserted claims invalid because they impermissibly mixed two statutory classes of subject matter, as well as because they required construing the same term differently in the same claim for the claims to make sense.

The Federal Circuit reversed the invalidity holding, finding that while the claims were written in an "unconventional" format, that format did not result in mixing multiple classes of statutory subject matter in the same claim.  Further, while the court acknowledged that typically the same term is given the same construction throughout a claim (particularly when the second instance is prefaced with "the" or "said," thereby making reference to the first use), in this case, there was no "uniform language" surrounding the term that mandated an identical construction, and as a result, the claim was not indefinite.

Not all was good for the patentee, however, as the court affirmed the district court's claim construction.  The patentee stipulated that if the claim construction was affirmed, there was no infringement, and as a result, the district court's summary judgment of noninfringement was affirmed.

More detail of Microprocessor Enhancement Corp. v. Texas Instruments, Inc. after the jump.

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In a decision Friday, the Federal Circuit affirmed a final judgment of invalidity of all claims of a patent indefinite.  The claims had several means-plus-function clauses that were computer-implemented, however no algorithms for implementing the claimed functions were disclosed in the specification.  The district court held the claims invalid because there was no "structure" (i.e., algorithm) disclosed in the specification corresponding to the means-plus-function clauses.

The Federal Circuit affirmed, noting that when a means-plus-function clause is computer-implemented, there must be at least one example in the specification of an algorithm performing the function in order to meet the requirements of 35 U.S.C. § 112 ¶ 6 .  Without such an example, what is left is purely functional claim language, which is impermissible under the statute. 

Likewise, it is insufficient to argue that one of ordinary skill in the art would be able to implement the method.  While that may solve any § 112 ¶ 1 enablement concerns, it does not meet the statutory requirement of a disclosure of "structure" in § 112 ¶ 6.  As a result, the claims were held invalid as indefinite.

More detail of Aristocrat Techs. Austl. Pty Ltd. v. Int'l Game Tech. after the jump.

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In a second decision Friday, the Federal Circuit affirmed a district court's finding of 35 U.S.C. § 112, second paragraph indefiniteness.  The term was defined in the specification, however the district court held that definition was too subjective and unclear, largely because it relied on relative terms.  The proper scope was also not discernable from the figures, as they did not define the scope of the invention as compared to the prior art.

The Federal Circuit affirmed, finding that the claims were insolubly ambiguous.  The court held that one aspect of the proposed definition was not supported by the claim language or specification.  The other two aspects of the definition, while having support in the claims, nevertheless left one of ordinary skill in the art unable to "translate the definition into meaningfully precise claim scope."  As such, the court affirmed the finding of indefiniteness

The court also took the opportunity to discuss functional limitations in claims, and their relationship to indefiniteness.  While the court acknowledged that functional claim language is acceptable in some situations, such language sometimes does not "provide a clear-cut indication of the scope of subject matter embraced by the claim."  The court also invited the USPTO to require patent applicants to clarify the scope of functional limitations, stating:

When a claim limitation is defined in purely functional terms, the task of determining whether that limitation is sufficiently definite is a difficult one that is highly dependent on context (e.g., the disclosure in the specification and the knowledge of a person of ordinary skill in the relevant art area). We note that the patent drafter is in the best position to resolve the ambiguity in the patent claims, and it is highly desirable that patent examiners demand that applicants do so in appropriate circumstances so that the patent can be amended during prosecution rather than attempting to resolve the ambiguity in litigation.

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In a decision today the Federal Circuit held that the district court had incorrectly determined that AllVoice Computing PLC's patent was invalid for indefiniteness and failure to meet the best mode requirement. In reaching its decision, the Federal Circuit determined that the lower court had used the prosecution history of the patent to interpret the claims too narrowly and that the alleged best mode violation was outside of the scope of the claim.

This Federal Circuit also cited to KSR as a reason for holding a patent to be valid. Specifically, the court cited the passage describing one of ordinary skill in the art as "a person of ordinary creativity, not an automaton" in support of its holding that the claims were not indefinite. Because of this "ordinary creativity," one of ordinary skill in the art would understand the scope of the means-plus-function limitations in the claims, and as a result, they were not indefinite.

More detail of AllVoice Computing PLC v. Nuance Commc'ns, Inc. after the jump.

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