Brief Discussion of all Supreme Court and precedential Federal Circuit Patent Cases between November 1, 2013 and September 2, 2014
Hyperlinked to more detailed discussions of each case
St. Jude Medical Cardiology Division, Inc., v Volcano Corporation, Fed. Cir. Case 2014-1183 (April 4, 2014); In re Dominion Dealer Solutions, LLC, Fed. Cir. Misc. Docket 109 (April 24, 2014); In re the Proctor & Gamble Company, Fed. Cir. Docket 121 (April 24, 2014)
Denials of petitions for inter partes review are deemed not to be appealable to the Circuit.
In another dismissal of an inter partes appeal, the Circuit ruled that one who assigned his patent during an inter partes reexamination had no right to appeal the inter partes decision.
The Circuit reverses an interference determination that there was inadequate disclosure in the specification to support copied claims directed to the treatment of herniated discs.
The Circuit vacates and remands a district court decision in an interference action because the district court erred in refusing to consider evidence that was not presented in the PTO but was pertinent to the determination of priority.
While the AIA eliminated interferences for patent applications filed after March 16, 2013, it is still possible to have interferences declared as to applications and patents filed prior to that date as long as the interference claim is submitted within one year of issuance of a patent or within one year of the publication of an application. Interferences in which priority of invention is determined will therefore be with us for at least the next several years, so these interference decisions remain pertinent.
The Supreme Court unanimously rules that the claimed invention is no more than an abstract concept for managing risk in computerized trading, and as such does not constitute patentable subject matter. The Court raises the bar on whether computer-related business method patents can recite patentable subject matter. With three justices arguing in affirmance that business method patents can never recite patentable subject matter, a unanimous Court strikes down the claims at issue.
The claimed invention is designed to facilitate the exchange of financial obligations between two parties by using a computer system as a third-party intermediary. Specifically, the patents in suit claim (1) a method for exchanging financial obligations, (2) a computer system configured to carry out the method for exchanging obligations, and (3) a computer-readable medium containing program code for performing the method of exchanging obligations.
The Supreme Court holds that because the claims are drawn to a patent-ineligible abstract idea, they are not patent eligible under §101. The opinion, written by Justice Thomas, is summarized by the Court:
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method claims simply recite the concept of intermediated settlement as performed by a generic computer. They do not, for example, purport to improve the functioning of the computer itself or effect an improvement in any other technology or technical field. An instruction to apply the abstract idea of intermediated settlement using some unspecified, generic computer is not “enough” to transform the abstract idea into a patent-eligible invention.
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In a concurring opinion, Justice Sotomayor wrote, citing Justice Steven’s concurring opinion in Bilski: “I adhere to the view that any claim that merely describes a method of doing business does not qualify as a ‘process’ under §101.” She was joined in that opinion by Justices Ginsburg and Breyer.
In late July, while testifying before the House Judiciary Committee, Acting Deputy Director of the PTO Michelle Lee noted that the PTO was pulling allowances for a reassessment of claims under CLS. Applicants have been notified of the withdrawal and the applications were returned to the originally assigned examiners. The PTO is in the process of evaluating public comments in preliminary examination instructions it issued on June 30.
In a paper just published today in IP 360 on how to draft claims that will be acceptable under Alice, the author said to (1) get technical (claim a particular way of doing it on a computer – not every way); (2) narrow the claims (include elements that claim significantly more than the idea itself); (3) tell a compelling story (in the spec and in at least some claims); (4) play up the distinctions between man and machine (make the computer integral to the claimed invention, so a human can’t do it with a pencil and paper); and
(5) keep an eye on what the Federal Circuit says in applying Alice.
In this first patentable subject matter case decided by the Circuit since CLS, the panel affirms a decision by the district court and rules that claims defining a device profile and a method for creating a device profile within a digital image processing system are not patent eligible under 35 U.S.C. § 101.
The claim recites a process of taking two data sets and combining them into a single data set, the device profile. The two data sets are generated by taking existing information—i.e., measured chromatic stimuli, spatial stimuli, and device response characteristic functions—and organizing this information into a new form. According to the panel, claim 10 thus recites an ineligible abstract process of gathering and combining data that does not require input from a physical device. Without additional limitations, a process that employs mathematical algorithms to manipulate existing information to generate additional information is not patent eligible. "If a claim is directed essentially to a method of calculating, using a mathematical formula, even if the solution is for a specific purpose, the claimed method is non-statutory." Parker v. Flook, 437 U.S. 584, 595 (1978).
In a non-precedential opinion the Circuit determines that patents directed to computer-aided methods and systems for managing a game of Bingo do not claim patentable subject matter, noting that the case is a straight-forward application of Alice Corp. v. CLS Bank.
The patents claim managing a bingo game while allowing a player to repeatedly play the same sets of numbers in multiple sessions. According to the panel, reviewing the claims de novo, the district court correctly concluded that managing the game of bingo “consists solely of mental steps which can be carried out by a human using pen and paper.” Like the claims at issue in Gottschalk v Benson, 409 U.S. 63 (1972) not only can these steps be “carried out in existing computers long in use,” but they also can be “done mentally.” Thus, the panel holds that the subject matter claimed in the patents is directed to an abstract idea.
Abstract ideas may still be patent-eligible if they contain an “‘inventive concept’ sufficient to ‘transform’ the claimed abstract idea into a patent-eligible application,” Alice, but, according to the panel, in this case, the claims recite a generic computer implementation of the covered abstract idea. Accordingly, the panel holds that the claims at issue do not have an ‘inventive concept’ sufficient to ‘transform’ the claimed subject matter into a patent-eligible application.
In a case decided by the Circuit shortly after the Circuit decided Alice but well prior to the Supreme Court’s decision in that case, the panel agrees that this method for distributing products over the Internet via a facilitator sets forth patentable subject matter, but disagrees on the analysis.
The panel, made up of Judges Rader, Lourie and O'Malley, vehemently disagreed on the appropriate tests on determining whether there was patentable subject matter.This case came to the Circuit in an unusual way in that the district court dismissed the case under Fed.R.Civ. P. 12(b)(6) because the claim did not recite patentable subject matter. The Federal Circuit reversed and remanded, and a petition for certiorari was filed. Shortly thereafter the Supreme Court decided Mayo, holding that steps of the medical diagnostic method claims at issue failed to "add enough" to the "inventive concept" of the asserted method patents—the correlations between metabolite levels and effectiveness of the drug. The Supreme Court vacated the Federal Circuit's opinion and remanded the case. On remand, the Federal Circuit denied a motion for en banc hearing since it was in the process of considering Alice v. CLS.
Because Alice is now the law, the Circuit’s analysis won’t be described here.
In a decision rendered months prior to Alice, a panel of Judges Lourie, Dyk and Taranto affirmed the district court's summary judgment of invalidity of computer-related medical diagnosis claims under 35 USC 101 as being directed to unpatentable subject matter. The panel found that the district court's ruling properly followed CyberSource, where the court held that section 101 did not embrace a process defined simply as using a computer to perform a series of mental steps. CyberSource and earlier precedents rest on the Supreme Court's decisions indicating that section 101 covers neither "mental processes" associated with or as part of a category of "abstract ideas," nor processes that merely invoke a computer and its basic functionality for implementing such mental processes without specifying new physical components or specifying processes defined other that by the mentally performable steps. The opinion neatly anticipated what the Supreme Court was going to be saying in Alice, instead of following Judge Rader and others on the Circuit who feel section 101 should be a coarse strainer on patentability.
In another pre-Alice decision, the Circuit determined that a cloned animal is not patentable because it is a natural phenomenon that does not possess different characteristics than an animal found in nature. The Court cited Chakabarty and Funk Bros. for the teaching that when the qualities of the invention sought to be patented "are the work of nature” and are unaltered by the hand of man, there is no patentable subject matter. Here, the methods of creating the clone were not at issue as they were separately patented in another application. Roslin argued that clones like Dolly are patentable because they are not
created via nature, but instead by human handiwork. The Circuit disagreed, noting "Dolly’s genetic identity to her donor parent renders her unpatentable” under Chakabarty because she possesses no "markedly different characteristics from any animals found in nature.” The Circuit then examined Dolly under the more recent Myriad doctrine but found Roslin had not created or altered any of the genetic information of its claimed clones, or the genetic structures of the DNA used to make them.
The Circuit affirms a determination of obviousness as to a BMS patent covering its Baraclude® drug used for the treatment of hepatitis B. According to the panel, a party seeking to invalidate a patent as obvious must demonstrate that a skilled artisan would have been motivated to combine the teachings of the prior art references to achieve the claimed invention, and that the skilled artisan would have had a reasonable expectation of success from doing so. To establish obviousness in cases involving new chemical compounds, the accused infringer must identify some reason that would have led a chemist to modify a known compound. Generally, an obviousness inquiry concerning such known compounds focuses on the identity of a "lead compound." A lead compound is a compound in the prior art that would be "a natural choice for further development efforts."
A divided panel reverses a determination of invalidity as to obviousness of the two patents in suit directly to an eyelash growth stimulant after deciding that there was insufficient corroboration to prove that the claimed invention was conceived before an article that rendered the claimed invention obvious. Given the overwhelming weight of evidence, the majority felt that remand is unnecessary “as here, the content of the prior art, the scope of the patent claim, and the level of ordinary skill in the art are not in material dispute, and the obviousness of the claim is apparent in light of these factors.” Accordingly, the majority reverses the district court’s finding that the patent is not invalid for reasons of obviousness.
The Circuit reverses and remands a portion of the Board's inter partes reexamination decision because very similar claims were found to be valid and invalid, citing an obligation to the public not to provide inconsistent rulings of patentability.
A split panel of the Circuit affirms an obviousness finding of the PTO Board in a ruling that in some respects seems inconsistent with the KSR’s dictate that “common sense” is to be considered in obviousness rulings.
HIMPP argues that the Examiner and the Board failed to consider the knowledge of a person having ordinary skill in the art solely because HIMPP did not provide documentary evidence to prove purportedly well-known facts. HIMPP asserts that refusing to consider the knowledge of a person having ordinary skill in the art because of a lack of record evidentiary support is contrary to the Supreme Court's admonishment in KSR against the overemphasis on the importance of published articles and the content of issued patents. The majority disagreed with HIMPP, and ruled that the Board was correct to require record evidence to support an assertion that the structural features of the claims were known prior art elements.
The Circuit determined that the evidence “did not even come close” to being substantial enough to support an obviousness finding and therefore reversed the denial of JMOL.
But the Circuit affirmed the denial of a motion for new trial, even though defendant’s witness testified about an opinion despite the fact that privilege had not been waived prior to trial, and defendant’s expert discussed prior art that had not been disclosed prior to trial.
Based largely on its conclusion that the claimed combination would not have been “obvious to try,” and that the objective indicia of unexpected result, commercial success, and long felt but unsolved need all support a finding of nonobviousness, the panel reverses the Board’s determination that a patent to a treatment for psoriasis was invalid under §103.
Although patents to Dikstein and Serup attempt the combination of a vitamin D analog with a corticosteroid, neither discloses or addresses the stability problems of combining vitamin D analogs and corticosteroids into one pharmaceutical formulation. Leo presented experimental evidence to the Board that each of these ingredients harmed the storage stability of the vitamin D analog and corticosteroid combination. If these discoveries and advances were routine and relatively easy, the record would undoubtedly have shown that some ordinary artisan would have achieved this invention within months of Dikstein or Serup. Instead this invention does not appear for more than a decade.
Objective Evidence of Nonobviousness
This record shows “extensive experimental evidence” of unexpected results that contradict the Board’s obviousness finding. The commercial success of Leo Pharmaceutical’s Taclonex® ointment is a testament to the improved properties of the ’013 patent’s claimed invention. The record also shows evidence of long felt but unsolved need, i.e., the need for a single formulation to treat psoriasis. The length of the intervening time between the publication dates of the prior art and the claimed invention can also qualify as an objective indicator of nonobviousness.
In a split decision, the court affirmed a summary judgment determination of invalidity of patents directed to Roche’s popular Boniva® osteoporosis drug, the panel members vehemently disagreeing on the teachings of the prior art and the proper analysis for the “obvious to try” issue.
The issue in this case is whether it would have been obvious at the time of invention to select a once monthly oral dosing regimen of ibandronate to treat osteoporosis and to set that dose at 150 mg. As to the frequency of dosing, the majority found that there was at least a reasonable expectation that once monthly dosing of ibandronate could successfully treat osteoporosis and reduce fracture risk. According to the majority, conclusive proof of efficacy is not necessary to show obviousness. The prior art established at least a reasonable expectation that once monthly dosing of ibandronate could successfully treat osteoporosis and reduce fracture risk As to the amount of the monthly dose, the panel found that the combination of several prior art references suggested a dosage level of about 150 mg per month, or at least indicated that a monthly dose of 150 mg was obvious to try. A person skilled in the art looking to scale to a monthly dose of oral ibandronate from a known-effective daily dose was faced with a very limited set of possibilities, and all the law requires is a reasonable expectation of success.
In her second discussion of the “obvious-to-try” issue in the past two weeks, Judge Newman, this time writing for a unanimous panel, reminded us that the standard of “obvious-to-try” requires a limited number of specific alternatives offering a likelihood of success in light of the prior art and common sense.
The appeal as to a first patent was dismissed as moot because the patent had expired and all of the claims had been substantively amended during reexamination. As to the other two patents, the panel reversed the Board’s decision for improper consideration of what motivation, if any, a skilled artisan at the relevant time would have had to pursue the claimed invention, and for improper discounting of the objective indicia of non-obviousness.
Citing KSR, the panel noted that the key issue in making the obviousness determination is whether the relevant skilled artisan– after reading the prior art disclosures that a GIIE endonuclease can promote targeted gene transfer into non-chromosomal DNA in prokaryotic cells– would have expected that a GIIE endonuclease would successfully promote targeted gene transfer into the chromosomal DNA of eukaryotic cells, and thus had good reason to pursue that possibility. Citing Bayer v. Watson, the panel stated the proper test as being whether one of ordinary skill in the art, at the time, have had
a "reasonable expectation of success" in pursuing the possibility that succeeded and was claimed.
The Circuit reverses a determination of validity based on misstatement of the test for obviousness,
and misapplication of the doctrines of teaching away, unexpected result, and commercial success. The proper test for obviousness is whether the claimed invention as a whole would have been obvious and not whether prior art provides the motivation to meet a critical parameter in the claims.
With respect to teaching away, the panel notes that the fact that increasing the amount of adapalene up to 0.1% generally increases side effects, does not mean that that prior art teaches away from using the claimed 0.3% concentration; that is, there is nothing in the prior art to suggest that increasing the concentration to 0.3% would be unproductive or that the side effects would be serious enough
to dissuade the use of 0.3%. As to unexpected results, the district court found that a skilled artisan would have expected that tripling the concentration of adapalene would have dramatically increased the side effects. The panel determined that, while this result may have been unexpected, unexpected results that are probative of nonobviousness are those that are different in kind and not merely in degree. Where an unexpected increase in efficacy is measured by a small percentage, as here, the result constitutes a difference in degree, not kind. As to commercial success, the district court noted that the fact that Tolmar seeks to enter the market is precisely because Galderma's Differin has been commercially successful. But the panel pointed out that that is true in every ANDA case if not every patent case. The fact that Tolmar thinks it can make a profit selling a generic version reveals very little about the level of commercial success of the patented invention relative to the prior art.
The Circuit vacates a decision by the PTO Board in an inter partes review, finding that the Board's approach failed because it narrowly focused on the cited references and did not follow the "flexible analysis" of KSR. Specifically, the panel required an analysis that reads the prior art in context, taking account of "demands known to the design community," "the background knowledge possessed by a person having ordinary skill in the art," and "the inferences and creative steps that a person of ordinary skill in the art would employ."
In a split decision the Circuit held that an invention conceived by a foreign inventor and reduced to practice in the U.S. by others can qualify as prior art under 35 U.S.C. §102(g)(2). That section provides, "[a] person shall be entitled to a patent unless . . . before such person's invention thereof, the invention was made in this country by another inventor who had not abandoned, suppressed, or concealed it." While §102(g) was eliminated in the AIA, that amendment only affects patents having a filing date of March 16, 2013 or later, so §102(g) cases are still very relevant. –
The Circuit affirms summary judgment of anticipation based on a post by a college student despite the patentee’s argument that the post would not have been accessible to those with ordinary skill in the art. The patentee Suffolk contends that the Usenet newsgroup was populated mostly by “beginners,” not those of ordinary skill in the art. Suffolk bases this claim on the college student’s comment that he was a “newbie” and that “this question might seem ridiculous.” The panel noted the evidence that there were no courses or books concerning CGI at the time of the post in 1995, and the inventor learned about CGI through self-study, presumably using the Internet. Second, the record indicates that those of ordinary skill in the art actually were using such newsgroups at the time. Specifically, both Suffolk’s validity expert and the inventor both used the newsgroups.
The Circuit reverses a determination of anticipation by the Patent Trial and Appeal Board in an inter partes reexamination where there is no substantial evidence to support the Board’s decision. This case, like the Tobinick case decided two weeks earlier and discussed above, shows that the Circuit is not reluctant to reverse determinations by the PTAB, even when the standard of review is so low that it is simply looking for "substantial evidence" to support the Board's decision.
The Supreme Court reverses the Federal Circuit’s holding that a claim meets the dictates of 35 USC 112 as long as it is not “insolubly ambiguous,” unanimously rejecting the Circuit’s standard, which “tolerates some ambiguous claims but not others.”
According to the Supreme Court, section 112’s definiteness requirement must take into account the inherent limitations of language. On the one hand, some modicum of uncertainty is the “price of ensuring the appropriate incentives for innovation,” and patents are “not addressed to lawyers, or even to the public generally,” but to those skilled in the relevant art. At the same time, a patent must be precise enough to afford clear notice of what is claimed, thereby “‘apprising the public of what is still open to them,’ ”
To tolerate imprecision just short of that rendering a claim “insolubly ambiguous” would diminish the definiteness requirement’s public-notice function and foster the innovation-discouraging “zone of uncertainty,” against which this Court has warned. The expressions “insolubly ambiguous” and “amenable to construction,” which permeate the Federal Circuit’s recent decisions concerning §112, ¶2, fall short in this regard and can leave courts and the patent bar at sea without a reliable compass.
A ruling of noninfringement was affirmed where the patentee never read its claims on the accused drugs but instead analyzed infringement based on tests performed during development of its own product. However, the panel reversed rulings that the patents in suit violated enablement and written description requirements of § 112.
The Circuit reverses a determination of indefiniteness because one of ordinary skill would be able to determine the meaning and scope of the claim.
A Federal Circuit panel agrees as to 3 of the 4 patents in suit but is divided as to the fourth where the written description apparently did not conform to the figures.
In this case, decided prior to Nautilus v. Biosig, the Circuit upholds the validity of different standards for claim indefiniteness during prosecution proceedings at the PTO and during post-issuance proceedings before a court.
The MPEP provides at §2173.05(e) that "a claim is indefinite when it contains words or phrases whose meaning is unclear." The applicant argued to the Circuit that the proper standard for determining indefiniteness in the PTO should be the same as the standard applied by the Circuit; that is, whether the term is "insolubly ambiguous." He argued that this would be an easier standard for him to meet since a claim is not "insolubly ambiguous" if "a court can give any meaning to the disputed term in the context of the claim." The more lenient “insolubly ambiguous” test was, as noted above, thrown out by the Supreme Court in Nautilus.
In an infringement case directed against Nintendo’s Wii product, the Circuit affirms that the asserted claims are indefinite because structure for the claimed “integrator means” is not adequately disclosed in the specification.
The patent in suit is directed to an input device in which a user can communicate with a computer by moving the input device — much like using a mouse, but in three dimensions. The input device sends commands to the computer based on the input device's three-dimensional position, orientation, and motion. In the preferred embodiment, these components include three accelerometers and three rotational rate sensors. The patent does not further explain how the numerical integration is performed, only that it is performed in a "conventional manner."
The panel cited to the pertinent language of § 112 ¶ 6 and noted that, in exchange for using means plus function claiming, the patent must disclose the corresponding structure for performing the claimed function and clearly link that structure to the function. The panel held that if the function is performed by a general purpose computer, the specification must also disclose the algorithm that the computer performs to accomplish that function.
The Circuit affirms a ruling that (1) a claim corrected by a certificate of correction cannot be asserted where the infringement began prior to issuance of the certificate, and (2) an apparatus claim that includes method limitations is invalid as indefinite.
The patentee argued that the district court itself had authority to correct a claim error but the panel holds that a district court can correct a patent only if the error is evident from the face of the patent. Here, the error is not evident from the face of the patent since the claim reads coherently without the missing limitation.
The Circuit also held that the apparatus claim at issue combines two statutory classes of invention and therefore the claim is indefinite. Here, because of the disputed language (“wherein said user completes” and “wherein said user selects”), it is unclear here when infringement would occur.
The Circuit reverses summary judgment of invalidity under § 112, ¶ 1, holding that issues of fact remain as to whether the claims of the patent that do not recite “sensors” are broad enough to include sensor-less systems even though the patent specification states that “the collating unit of the present invention broadly includes several components, including “a plurality of sensors.”
When determining whether a putative inventor has met his burden of providing "clear and convincing evidence" of inventorship, the Circuit determined that a court should assess whether credible testimony has been given, and if so, whether corroborative evidence has also been provided. Here the putative inventor "refused four times to take an unqualified oath to tell the truth at his deposition" and "filed a declaration calling the district court 'obtuse,' 'overly assumptive,' and 'ignorant'," and failed to produce any realiable documents supporting his allegations. Not surprisingly, the district court the district court concluded that Mr. Wilkins and Mitsubishi had failed to establish Mr. Wilkins' inventorship, and that ruling was affirmed by the Circuit.
The Circuit affirmed a district court's summary judgment ruling of invalidity based on the failure to comply with the priority claiming requirements of 35 USC 119 and 120. Here the Circuit determined that the patent was not entitled to the priority date it claimed, and therefore the patent was invalid.
The Federal Circuit first looked to the language of Section 120, which allows a later-filed application to claim the benefit of an earlier filing date if "it contains … a specific reference to the earlier filed application
…." The Circuit had previously held that the "specific reference" requirement mandates that each intermediate application in the chain of priority must refer to the prior applications. Here, intermediate applications, but not the actual patent in suit, failed to specifically reference each of the earlier-filed applications in the priority chain. Therefore, the patent in suit was not entitled to claim priority back to the priority date of the first international application, which thus became invalidating prior art.
There were issues of fact as to whether declarations and arguments made by the patentee’s counsel could be considered “false.” in the context of the Therasense “false affidavit” exception to the requirement of the “but for” materiality test.
The panel examined whether a summary judgment of no inequitable conduct was appropriate. Applying all inferences in favor of the non-moving party, the panel determined that there were genuine issues of material fact that precluded summary judgment. Therasense held that a finding of inequitable conduct must be supported by "but for" materiality and a specific intent to mislead, unless there is something tantamount to a false affidavit being filed in support of patentability.
This case shows how easy it can be to create factual issues sufficient to preclude summary judgment by focusing argument on the "false affidavit" exception to the "but for" materiality test.
The Circuit affirms unenforceability based upon the intentional withholding of material prior art, keeping true facts from an expert, and making affirmative misrepresentations of material facts. The panel also notes that the actions come close to the misconduct that Therasense held could justify a finding of inequitable conduct without showing but-for materiality. The case shows that the Circuit will uphold findings of inequitable conduct after Therasense but in almost every case where it has done so there has been misconduct at issue in addition to the withholding of prior art.
After having paid $100 million to license a first patent from plaintiffs to market its Humira anti- inflammatory, AbbVie was sued for infringement of a second patent. That second patent was found invalid for double patenting since the narrow species of the newer patent were not patentably distinct from the genus claimed in the first patent.
The Circuit affirms claim construction and defendants’ motion for summary judgment of noninfringement that the Android operating system does not infringe three Gemalto patents. Included as defendants are HTC, Google, Samsung, Motorola Mobility and Exedea. The summary judgment means that Java cards that are installed in smartphones using Google’s Android operating system dd not infringe the Gemalto patents.
A plaintiff must provide “particularized testimony and linking argument to show the equivalents” are insubstantially different, and Gemalto provided no testimony asserting that the difference in functionality between cache memory and permanent memory is in fact insubstantial. Therefore, no reasonable fact finder could find that the two types of memory function in substantially the same way to achieve substantially similar results. Moreover, if cache memory were equivalent to the recited memory that stores an application and interpreter, Gemalto’s claims would read on microprocessor systems that were widely used prior to its invention. According to the panel, the doctrine of equivalents cannot be applied to encompass the prior art. Therefore, the panel agreed with the district court that the accused devices do not infringe under the doctrine of equivalents due to their use of cache memory.
In two separate rulings the Circuit finds that generic versions of Lysteda®, a popular treatment for heavy menstrual bleeding, to be non-infringing, either because the active ingredient released more slowly or too quickly to infringe the patents in suit.
The Supreme Court has accepted Teva v. Sandoz for certiorari, showing its eagerness to examine the Federal Circuit’s insistence in this case and in Lighting Ballast that claim construction appeals are to be reviewed de novo. The Federal Circuit’s 6-4 en banc Lighting Ballast decision was based largely on deference to its prior Federal Circuit decisions and stare decisis, which the Supreme Court does not have to respect.
The Teva case involves an appeal of a ruling invalidating patents covering Teva’s multiple sclerosis drug Copazone, which had sales of over $4 billion last year. A more deferential review of claim construction could lead to a reversal, facilitating Teva’s attempts to block the introduction of a generic version of the drug.
Those arguing that the Circuit should give deference to the district courts and apply a “clear error” standard of review point to the high reversal rate that forces parties to incur the expense of a trial and appeal, which might need to be repeated. Those who favor maintaining the de novo standard note that the reversal rate is declining and those cases that go all the way through an appeal are the most difficult cases. Others suggest some sort of hybrid approach but most say that this would require the district courts and the Circuit to dissect “legal” and “factual” components, which would result in more confusion and litigation about which rulings are “findings” and which are “holdings.”
Teva’s reply brief is due September 10 so it will be at least several months and more likely next year before the case is decided.
In a 6-4 en banc decision, the Federal Circuit held that arguments and evidence presented by the appellants, the dissent, and many of the amici did not justify reversing the holding of Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448 (Fed. Cir. 1998) (en banc) that claim construction required a de novo standard of review. The majority opinion by Judge Newman noted that the question before it was not simply whether to defer to district courts or instead to examine claim construction de novo. The question was whether there is “compelling justification” to depart from the doctrine of stare decisis, particularly when that precedent is an en banc Federal Circuit decision.
The Circuit reverses a district court’s ruling that Google’s popular Street View product does not infringe, noting that the district court’s claim construction relied too heavily on extrinsic evidence and an alleged disclaimer, and that did not give sufficient weight to the plain language of the claim or the specification.
The district court based its construction largely on extrinsic evidence regarding the technical meaning of “elevation” as an architectural term of art. The panel disagreed with this approach because the court did not adequately consider the intrinsic evidence that supported a broader construction. For example, the claim language itself supports a broader interpretation since the operational language in this case is
“substantially elevations” and not simply “elevations.” The panel found that the district court’s construction effectively read “substantially” out of the claim, and “a claim construction that gives meaning to all the terms of the claim is preferred over one that does not do so.”
The panel also noted that the specification supports a broader construction. For example, the specification discloses the option of using a fish-eye lens and such an image “provides a curved, as opposed to vertical, projection, and almost certainly reflects curvature and perspective.” Google’s “flat” construction would not allow the claims to cover the fish-eye lens embodiment. The examples in the specification that provide flat images do not require the narrower construction since those examples are merely described as preferable.
Google also cites to a statement in the specification that distinguishes prior art imaging
providing samplings on the surface of an imaginary sphere, which is "computationally intensive and hence cumbersome and inefficient in terms of time and cost." However, the panel did not think this statement amounted to a clear and unmistakable disavowal of claim coverage, noting that this reference is fundamentally different from the use of a cluster of cameras to take images looking out in all directions. Google also suggested that an argument made during prosecution to distinguish prior art disclaimed the construction sought by Vederi, but the panel similarly did not think that argument constituted a clear and unambiguous disavowal of spherical or curved images. -
We can take a lot from this case – make sure to describe the preferred embodiments as merely “preferred,” exercise care in distinguishing the prior art in the specification and the prosecution - but perhaps the clearest teaching is that, wherever possible, do not use the same verbiage to distinguish the prior art in all of the independent claims. While Vederi appears to be on the road to winning this case, its road might have been easier had it not included the phrase “substantially elevations” in all of the asserted claims in the four patents in suit.
The Circuit determines that the patentee disclaimed a broader scope of the claim term “preamble” in an IDS submission that included a previously-agreed-upon construction. An additional infringement theory argued by the patentee in a motion for reconsideration was waived because the argument was made for the first time in a motion for reconsideration.
The panel notes that the Circuit generally construes terms according to their plain and ordinary meanings to one of ordinary skill in the art, but departs from that meaning where there is disclaimer. Here, GBT clearly and unmistakably limited the term “preamble” to "a signal used for communicating with the base station that is spread before transmission." During reexamination of the '267 patent and prosecution of the '427 patent, GBT submitted and requested that the PTO "expressly consider" its stipulated construction of preamble from the Texas litigation. The stipulation required the preamble to be spread before transmission. According to the panel, it would have been natural for both the PTO and the public to
rely upon the stipulation in determining the scope of the claimed invention.
The Circuit affirms the ITC’s claim construction and a determination that Intel and its customers did not infringe X2Y’s patents. The technology at issue relates to structures for reducing electromagnetic interference in electrical circuits, and is used in many Apple and Hewlett-Packard computers. The patented inventions use shielding electrodes to reduce the undesirable buildup of charge, known as “parasitic capacitance,” between electrodes used for conduction.
A divided panel reverses the district court's claim construction on several grounds, including improperly reading limitations from the specification into the claims and improperly invoking judicial estoppel to limit the claims.
Noting that the standards for finding lexicography and disavowal are exacting, the panel stated: “To act as his own lexicographer, a patentee must clearly set forth a definition of the disputed claim term, and clearly express an intent to define the term. Similarly, disavowal requires that the specification make clear that the invention does not include a particular feature.” The panel found neither here. Similarly, while the specification only discloses a single embodiment of an IDC connector, it does not disavow or disclaim the plan meaning of IDC connector or otherwise limit it to that embodiment.
In each of these cases the Circuit reminds us there must be a clear and unambiguous disavowel of a broad definition. In Golden Bridge and Hill-Rom the alleged disavowal was in the prosecution history while in X2Y and GE Lighting it was alleged to have been in the specification. . In Vederi the disavowal was alleged to have been in both. However, despite this high bar, these cases show that the Circuit will, if the evidencen is clear and unambiguous, find such disavowals. - The X2Y case is a good example of how the careless drafting of a specification can doom a patentee’s claim construction because, other than the limiting language in the specification, X2Y had strong arguments for a broad claim construction. Golden Bridge shows how careful we have to be in prosecution to avoid a disavowal.
In a nonprecedential but interesting decision rendered two days prior to Vederi, the Circuit reached a conclusion that was different from that in Vederi, reversing a claim construction ruling based upon what the panel determined to be a clear prosecution disclaimer.
This decision is interesting because the panel did not even address arguments by the patentee (1) that the plain language in claim supported the district court’s construction and (2) that the narrower construction would exclude coverage of one of the disclosed embodiments, both of which were considered critical in Vederi. This case again demonstrates the importance of closely studying the prosecution history when rendering an infringement opinion or when presenting claim construction arguments to the district court, even when the claim language appears to be clear and broad.
In this appeal from the PTAB, the Federal Circuit reverses a determination of obviousness based on the panel’s holding that “adapted to” is not synonymous with “capable of” when considering whether one of ordinary skill would have thought to modify a prior art exercise machine to arrive at the claimed invention. Because these terms are commonly used claim terms, the court’s holding is one to closely consider.
Claims that recite “means” are presumptively to be construed under § 112, ¶ 6, while those that don’t are presumptively not to be construed as means plus function claims.
The Circuit reiterates the test to be applied in determining whether claims that don’t use “means for” language should nonetheless be construed under § 112, ¶ 6. Here the panel unanimously determined that § 112, ¶ 6 did not apply because there was an adequate description of the structure through the use of the claim term “receiver.” The panel compared it to "height adjustment mechanism," "computing unit ...
for . . . evaluating," or "detent mechanism" in other cases. We see other cases where means plus function claims are not construed under § 112, ¶ 6 where there is sufficient structure recited in the claim to overcome the presumption of construction under § 112, ¶ 6. We just have to remember it is just a rebuttable construction so we should keep this in mind both when drafting a claim and arguing claim construction.
The Circuit affirms the PTAB’s reversal of an examiner's claim construction that had improperly relied on extrinsic evidence, but vacated the Board's determination that an inter partes reexamination requester had waived its right to present an invalidity argument by not cross appealing a PTO Office action.
The panel notes that extrinsic evidence is of relatively little probative value, especially where, as here, it is inconsistent with the intrinsic evidence. The panel also supported the Board's rejection of the argument that the examiner was construing the claims with an eye to preserving their validity under § 112, noting that this was a doctrine of limited utility.
In a split decision, the Circuit affirmed a venue transfer, but vacated the district court’s rulings on means- plus-function claims, holding that it was necessary to have expert testimony as to whether one with ordinary skill in the art would have understood the functions described, and whether there was adequate disclosure in the specification to support the claims.
While the majority of the panel determined that expert witness testimony may not be necessary in every case, it was necessary here for the court to decide whether SAP had met its burden of proving invalidity. The panel explained that a patent must describe sufficient structure or acts whereby a person of ordinary skill in the field could perform the specified function without undue experimentation. The panel held that it cannot be assumed that, without evidence, a general purpose judge can ascertain the position of persons of skill in the art and conclude that there is insufficient support for the eleven interrelated means-plus- function claim limitations. Instead of evidence, SAP submitted only attorney argument. The majority thus vacated the rulings as to the system claims.
Butamax Advanced Biofuels LLC v. Gevo, Inc., Fed. Cir. Case 2013-1342 (February 18, 2014); Frans Nooren Afdichtingssystemen B.V. v. Stopaq Amcorr Inc., Fed. Cir. Case 2013-1200 (February 21, 2014); Ancora Technologies, Inc. v. Apple, Inc., Fed. Cir. Case 2013-378 (March 3, 2014); Shire Development, LLC v. Watson Pharmaceuticals, Inc., Fed. Cir. Case 2013-1409 (March 28, 2014); and Braintree Laboratories, Inc. v. Novel Laboratories, Inc., Fed. Cir. Case 2913-1438 (April 22, 2014)
The Circuit flexes its muscle reversing claim construction rulings by the district court in de novo claim rulings consistent with Ballast Lighting.
In what seems to be a rare affirmance of claim construction, a unanimous panel affirmed the district court's use of extrinsic evidence to support claim construction. The Circuit determined that the term "gateway" had a well-understood meaning in the art at the time of filing, and plaintiff Starhome's definition was just too different from the way the industry had been using the term. The panel rejected Starhome's attempt to use the doctrine of claim differentiation since the pertinent claims differed in scope in several respects. The panel also refused to accept Starhome's attempt to use the prosecution history of a related European application. While noting that statements made to foreign patent offices are sometimes relevant, the panel felt that the European history actually supported defendant's position that the patentee did not intend to depart from the ordinary definition of the terms at issue.
In a split decision the Circuit reverses the granting of a motion for summary judgment of noninfringement as to four patents in suit. The panel finds issues of fact as to the first three patents based on its conclusion that certain evidence should not have been excluded, and that the district court improperly resolved factual issues against the non-moving party. The majority disagrees with the court as to claim construction on the fourth patent.
The Supreme Court reverses the Circuit’s en banc ruling that a defendant who performed some steps of a method patent and encouraged others to perform the rest could be liable for inducement of infringement even if no one was liable for direct infringement.
Justice Alito says once and for all, citing Aro Convertible, that liability for inducement must be predicated on direct infringement. Here the method has not been infringed because the performance of all of its steps is not attributable to any one person. Since direct infringement has not occurred, there can be no inducement of infringement under §271(b). The Federal Circuit’s contrary view would deprive §271(b) of ascertainable standards and require the courts to develop two parallel bodies of infringement law.
The Court’s reading of §271(b) is reinforced by §271(f)(1), which illustrates that Congress knows how to impose inducement liability predicated on non- infringing conduct when it wishes to do so. In Deepsouth v Laitram the Supreme Court looked to see whether §271(a), prevents someone from making parts of a shrimp deveining machine to sell to foreign buyers to assemble outside of the US. The Deepsouth decision said that §271(a) did not prevent that. As a result of Deepsouth, Congress established §271(f)(1) providing that whoever supplies from the US a substantial portion of the components of a patented invention as to actively induce the combination outside of the US, they are liable just as though those parts were combined in the US. There is no reason to apply a different rule for inducement.
Akamai subsequently asked the Circuit to revisit en banc the issue of whether joint performance of a patented method can create liability for direct infringement. On July 24, 2014 the Circuit rejected Akamai’s request, instead referring the case on remand to its two remaining panel members and a newly-selected judge.
A patent applicant unnecessarily narrowed a "contact" limitation in an originally-rejected patent claim and is now barred from asserting infringement under the doctrine of equivalents by products lacking physical contact. This is true even though the patentee would not have had to add this limitation to avoid the prior art. Reversing a district court judgment, a unanimous panel left little room for patentees who narrowed claims during patent prosecution to capture later-developed equivalents.
The Circuit rejected the argument of an appellant that foreseeability of an equivalent at the time of filing is a bar to a finding of infringement based upon the doctrine of equivalents. In doing so the panel provided a
good review of the effect of foreseeability, the difference between equivalence analysis under 112(f) and the doctrine of equivalents, the doctrine of vitiation, and the effect of factual stipulations at trial.
The district court held that foreseeability at the time of filing is not a formally recognized limitation on the doctrine of equivalents. R&P argued, as many accused infringers do, that the doctrine of equivalents does not apply to equivalents that were foreseeable at the time of filing. The panel ruled that it is clear that known interchangeability weighs in favor of a finding of equivalence.
There are only two differences between the equivalence determination for literal infringement purposes under 112(f) and the doctrine of equivalents: timing and function. Equivalence under 112(f) is evaluated at the time of issuance, while equivalence under the doctrine of equivalents is evaluated at the time of infringement. Hence, a technology that did not exist at the time of patenting can be found to be an equivalent under the doctrine of equivalents even though it cannot be an equivalent under the literal infringement analysis of 112(f). The second difference between literal infringement under 112(f) and doctrine of equivalents infringement relates to the function of the element. For literal infringement, the accused structures must perform the identical function, while the doctrine of equivalents covers accused structures that perform substantially the same function in substantially the same way with substantially the same results. This is true whether the accused equivalent was known at the time of patenting or later arising. Where a finding of non-infringement under 112(f) is based solely on the lack of identical function, it does not preclude a finding of equivalence under the doctrine of equivalents.
Presented with the issue of whether prosecution history estoppel should apply to design patents, the panel states that the same principles of public notice that underlie prosecution history estoppel apply to design patents as well as utility patents. With each type of patent, prosecution history estoppel promotes the “clarity that is essential to promote progress.” Refusing to apply the principles of prosecution history estoppel to design patents would undermine the “definitional and public-notice functions of the statutory claiming requirement.”
In a design patent case, the Circuit affirmed a finding of invalidity where the lower court properly followed the test for obviousness. The Circuit restated the two-step test as follows:
First, the court must identify “a single reference, ‘a something in existence, the design characteristics of which are basically the same as the claimed design.’” The “basically the same” test requires consideration of the “visual impression created by the patented design as a whole.” The trial court judge may determine almost instinctively whether the two designs create basically the same visual impression,” but “must communicate the reasoning behind that decision.
Once the primary reference is found, other “secondary” references “may be used to modify it to create a design that has the same overall visual appearance as the claimed design.” These secondary references must be “‘so related [to the primary reference] that the appearance of certain ornamental features in one would suggest the application of those features to the other.’”
The Circuit vacates a contempt order because the district court had not construed the claim language at issue. In so ruling, the panel discusses: the tests to be applied in deciding whether a contempt order
is appropriate; when claim construction requires language in the preamble to be considered limiting; whether a defendant that did not previously challenge validity is permitted to do so at the
contempt stage; and whether overseas sales of component parts of a device found to directly infringe and is the subject of an injunction should be the basis of a finding of contempt.
The panel also instructed the district court that regardless of what claim construction the court adopts on remand, Innova is not entitled to present new invalidity arguments at the contempt stage. In contrast to claim construction, validity was disputed in the underlying infringement lawsuit, so Innova has already
had a full and fair opportunity to present its arguments relating to invalidity. The panel noted that it saw no error in the court's denial of sanctions for Innova's overseas sales of component parts, since liability for those sales is premised on 35 U.S.C. § 271(f), while the underlying infringement action alleged direct infringement by sales of whole products.
The Circuit reverses a district court's contempt ruling because the defendant did not violate the "intellectual property rights" or any other clear restriction of a Consent Order.
The parties were previously in litigation over intellectual property rights related to pressure exchangers used in reversed osmosis. Hauge had been president of ERI, and to settle litigation resulting from his separation from the company, the parties entered into an agreement that was adopted by the district court in a Consent Order. After the expiration of the non-compete provisions of the Order, Hauge filed for and was issued a patent directed to a pressure exchanger, and subsequently began selling equipment based on his patent. He also entered into a consulting agreement with two then-current ERI employees to assist him in his new venture.
The panel noted that while Hauge's hiring two employees of ERI may constitute trade secret misappropriation, that would not justify a finding of contempt. But then the opinion just mentions what would seem to be critical - that ERI's trade secret claim in California state court based on the same conduct resulted in a unanimous jury verdict in favor of Hauge. In any event, concluding that Hauge did not violate any provision of the Order, the panel held that the district court abused its discretion in finding Hauge in contempt, and vacated the injunction.
The Circuit upheld the district court’s finding of fraud upon the court and award of sanctions against a party whose discovery documents were found by the district court to contradict statements made in the party’s pleadings. The panel found that the sanctions award was narrowly tailored to respond to the factual allegations the court found were made, pointing to the fact that the district court had performed its own interpretation of the license upon hearing Monsanto’s first motion to dismiss, had sided with Monsanto on the interpretation issue, and that DuPont’s problematic allegations were an attempted end-run around that dismissal. The opinion reviewed the path of discovery, found the documents
fairly discovered in relation to the factual issues being determined, and gave deference to the court’s factual findings in relation to DuPont’s material misrepresentations.
The district court ruled against the patentee CBT on the merits and then awarded defendants their costs, most of which were for e-discovery service providers, ruling that such costs were “the 21st Century equivalent of making copies.” A split Federal Circuit panel held that the district court erred in its interpretation of 28 U.S.C. § 1920(4) in awarding such costs.
The Supreme Court holds that district courts should determine whether a case is “exceptional” in a case- by-case exercise of their discretion, considering the totality of the circumstances.
The district court and the Circuit had applied the test set forth in Brooks Furniture Mfg., Inc. v. Dutailier Int’l, Inc., 393 F. 3d 1378 (2005). In that case the Circuit held that a case is exceptional under §285 only “when there has been some material inappropriate conduct related to the matter in litigation, such as willful infringement, fraud or inequitable conduct in procuring the patent, misconduct during litigation, vexatious or unjustified litigation, conduct that violates Fed. R. Civ. P. 11, or like infractions.” Absent misconduct in conduct of the litigation or in securing the patent, fees may be imposed against the patentee only if both (1) the litigation is brought in subjective bad faith, and (2) the litigation is objectively baseless.
In reversing the Circuit, Justice Sotomayor stated the proper test to be as follows:
We hold, then, that an “exceptional” case is simply one that stands out from others with respect to the substantive strength of a party’s litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated. District courts may determine whether a case is “exceptional” in the case- by-case exercise of their discretion, considering the totality of the circumstances.
On remand from the Supreme Court the Federal Circuit ruled on August 26 that the district court must now decide whether the case is exceptional to warrant the award of attorney fees to the accused infringer. But if the case comes back to the Circuit, the Circuit will be applying the abuse- of-discretion standard as it was instructed to in the Highmark case.
The Supreme Court rules that the district court’s decision on whether a case is exceptional should be reviewed on appeal for abuse of discretion and not de novo.
Highmark vacated another decision of the Circuit, based upon its ruling in Octane. Octane held that a determination of “exceptional” is to be decided by the district court on a case-by-case exercise of their discretion considering a totality of the circumstances, so the district court’s decision should be reviewed on appeal for abuse of discretion and not de novo.
Lessons to be considered in view of Octane and Highmark:
- The Circuit will have to accord more respect to district court decisions, suggesting that the Court may similarly jettison de novo review of claim construction in the pending Teva Pharmaceuticals case;
- Like KSR, this is an example of the Federal Circuit being told it is applying too high a burden of proof, particularly on patent infringement defendants;
- Like eBay, this is an example of the Court telling the Federal Circuit it should not be applying special rules to patent cases;
- In combination with post-issuance validity proceedings, this shows a power shift from NPE’s to those defending unreasonable patent infringement filings;
- Although the Senate is prepared to consider fee-shifting legislation, it would seem that Octane would cause both the Senate and the House to reconsider the need for such legislation, much like damages cases decided by the Circuit in 2010 and 2011 rendered less necessary legislation reducing the likelihood of excessive damage awards that otherwise might have been included in AIA; and
- The cases will likely increase the tendency of plaintiffs to file in jurisdictions perceived as being friendly to patentees, such as the Eastern District of Texas, to reduce the risk of an adverse fee award.
The Federal Circuit vacated and remanded the denial of an attorney fee award for consideration of whether the patentee's doctrine of equivalents theory was objectively baseless, and then, whether the totality of the circumstances demonstrated that the patentee acted with subjective bad faith.
In view of the Supreme Court’s Octane Fitness decision, the Northern District of California reverses its prior denial of an attorney fee award, finding the case to be “exceptional” because bad faith is no longer required.
Denial of permanent injunction is affirmed as to design patents but remanded as to utility patents. The Federal Circuit holds that a clear nexus must be established between infringing sales and irreparable harm, but the moving party does not need to show that the patented features were the sole reason consumers purchased the infringing product. Moreover, while licensing of the patents in suit and the ability of the defendant to pay are factors to be considered in determining whether or not there is irreparable injury, neither factor should be considered determinative.
The design patents at issue were to Apple’s so-called minimalist design consisting of a large rectangular display having rounded corners and a circular button below the display. The utility patents were directed to (1) the “bounce back” feature in which when a user scrolls in one direction across the face of the device past the edge of an electronic document, the screen bounces back to the document, (2) the “pinch-to-zoom” feature, using two fingers to zoom in or out, and (3) the “double-tap-to-zoom” capability.
The Circuit reverses the denial of a motion for preliminary injunction, holding that an infringement finding was “more likely than not,” that defendant had “not raised a substantial question as to validity,” and that the patentee had demonstrated irreparable harm even though it did not practice the patented invention. Chief Judge Rader, writing for a unanimous panel, found that the district court abused its discretion in denying Trebro’s motion for preliminary injunction
The panel's analysis regarding irreparable injury is interesting. The defendant had done well in competing for sales and therefore would have been able to satisfy any monetary judgment. However, the Circuit found to be critical the fact that very few machines were sold each year, and that once a machine was sold, that customer was likely to be lost to FireFly forever. This may be true to a certain extent in every case. It shows the importance of statistics in briefing irreparable injury, on the rate at which customers buying from the accused infringer return to purchase again from the patentee.
A divided panel affirms the denial of a motion for attorney fees incurred on appeal, on remand and in pursuing additional fees.
In the district court Becton and Nova (“Becton”) won judgments of non-infringement, invalidity, and inequitable conduct, supporting a finding that the case was exceptional and awarding almost $6 million in attorney fees. On appeal, in an important en banc ruling, Therasense v. Becton Dickinson & Co., 649 F.3d 1276, 1297 (Fed. Cir. 2011), the Federal Circuit elevated the standard of proof for inequitable conduct to require that the accused infringer must prove both elements – intent and materiality - by clear and convincing evidence. The Circuit thus vacated the district court’s judgment of inequitable conduct but, applying the higher standard on remand, the district court again concluded that the patent was procured through inequitable conduct.
On appeal, Becton argued it was entitled to appellate and remand fees because of the district court’s exceptional case finding. The majority noted that Becton presented no evidence of bad faith, and the mere act of pursuing appellate review cannot by itself suggest an abuse of the legal system. Here the fact the en banc ruling required a remand shows that the appeal was not without merit. Therefore, the district court did not abuse its discretion in declining to award fees for the appeal, the rehearing en banc, or the remand.
Becton also argued that Abbott forced it to incur additional fees in pursuing additional attorney fees. These “fees for fees” were denied by the district court and the panel affirmed that ruling, citing Supreme Court precedent for the proposition that such fees for fees litigation should be excluded as such “can spawn a Kafkaesque judicial nightmare of infinite litigation to recover fees for the last round of litigation over fees.”
A divided panel expands the double patenting doctrine by concluding that a patent that issues after but expires before another patent can qualify as a double patenting reference for the other patent.
The Circuit affirms a Board decision that applicants’ filing of a terminal disclaimer is not an error that can be remedied by a reissue application even though applicants mistakenly thought their application and a cited patent were commonly owned at the time of the disclaimer.
A majority of the panel reverses and remands the district court’s determination that defendants had implied licenses under the terms of a settlement agreement involving related patents. While the asserted patents claim priority to the same provisional applications as the patents that were the subject of the settlement agreement, the specifications of the asserted patents are different, and that the claims cover different subject matter.
An ITC exclusion order may not be predicated on a theory of induced infringement under 35 USC
§ 271(b) where direct infringement does not occur until after importation. A split panel rules that the
Commission's authority under section 1337 only reaches "articles that . . . infringe a valid and enforceable United States patent" at the time of importation. Because there can be no induced infringement unless there has been an act of direct infringement, however, there are no "articles . . . that infringe" at the time of importation when direct infringement has yet to occur. The ITC's exclusion order was thus revised to bar only those articles that directly infringed at the time of importation.
The Circuit reverses and remands the ITC’s review of an ALJ’s “order,” since that order was not either a “decision” or an “initial determination,” both of which are reviewable by the ITC.
A patented method covering a blood glucose system is exhausted by the company's sale—and often giveaway—of its meter, allowing patients with diabetes to use competitors' test strips without infringing the patent in suit.
A consumer advocacy group does not have standing to appeal the loss of a patent reexamination even though under the patent statute it was able to file a reexamination request. Federal courts do not have authority to entertain every dispute. To meet the constitutional minimum for standing, the party seeking to invoke federal jurisdiction must satisfy three requirements. First, the party must show that it has suffered an "injury in fact" that is both concrete and particularized, and actual or imminent (as opposed to
conjectural or hypothetical). Second, it must show that the injury is fairly traceable to the challenged action. Third, the party must show that it is likely, rather than merely speculative, that a favorable judicial decision will redress the injury. Although Article III standing is not necessarily a requirement to appear before an administrative agency such as the PTO, once a party seeks review in a federal court, "the constitutional requirement that it have standing kicks in."
The Circuit transfers back to the Eleventh Circuit the appeal of a declaratory judgment action seeking to establish patent ownership rights, holding that it has no jurisdiction to hear the appeal.
In a ruling dealing with patent pleading requirements under Iqbal and Twombly, the Oregon District grants defendants’ motion to dismiss where the plaintiff failed to set forth sufficient details regarding infringement following inter partes reexamination of the patent in suit.
The Circuit affirms a ruling that AbbVie’s patents are invalid for lack of adequate written description, permitting defendants to continue to market their Stelara® psoriasis treatment. In doing so the panel rejects AbbVie’s argument that defendants were precluded by collateral estoppel from challenging validity based upon a ruling by the PTO in a related interference proceeding.
According to the panel, because a district court can make a de novo determination of facts upon the submission of new evidence, a Board decision that is reviewed under § 146 is not a "binding final judgment" to preclude a losing party from litigating the same or related issues in a parallel proceeding. Consequently, the Board's priority and nonobviousness decisions lacked the requisite finality for purposes of collateral estoppel.
Rejecting the argument that the involuntary joinder provisions of Rule 19(a) should be applied, a divided panel of the Circuit affirms the dismissal for lack of standing because a co-owner of the patent elected not to join the suit.
Rule 19(a) states:
(1)Required Party. Arnostoefrsdwerwlreertfrrntedsary:
(ii)eng ryto al rk f rrg , ,ren-tsefer.
(2)Joinder by Court Order. farnstndsrr,et trrerneear.Arnworsonsafyeera t,narr,ny.
The panel feels that Rule 19(a) does not change the fact that rules of procedure, such as that in Rule 19(a), must give way to substantive patent rights. There are two exceptions that the co-owner of a patent may use to overcome the rule against involuntary joinder: (1) when a patent owner has granted an exclusive license, and (2) when, by agreement, a co-owner has agreed to be joined in an enforcement action. Neither situation is present here.
This shows the importance of making sure there is a provision in your ownership agreement that the co- owner agrees to be joined as a party in any infringement effort, even if it is at the cost of the other owner.
The panel affirms dismissal of a pre-AIA qui tam action based on improper patent marking despite plaintiff’s arguments that the AIA amendments were unconstitutional because they amounted to a pardon by Congress rather than the President, thus violating the separation of powers doctrine.
In a prior appeal the Circuit said Nokia could not address an issue raised on appeal, but instructed that the issue be presented to the Commission on remand. The Commission ruled the issue had been waived so refused to permit consideration. In a split decision the majority denies mandamus to Nokia, but the dissent couches this in terms of the Commission “defying this court’s order.”
The Circuit dismisses for lack of jurisdiction an appeal of a contempt order because the order is not a final judgment or otherwise appealable until the sanctions are decided by the district court. The fact that sanctions were ordered by the district court after the notice of appeal was filed does not help the appellant since the Circuit cannot normally consider documents outside of the record on appeal.
Patent validity will always be subject to PTO decisions on patentability until a final court judgment
is rendered in which all issues are resolved. The Circuit denied a motion for rehearing en banc on a 6-
4 vote, thus affirming a Federal Circuit panel decision throwing out a $24 million patent infringement award after more than ten years of litigation.
The Circuit vacates an injunction, a contempt order and an $18 million penalty because all of the claims of the two patents in suit have been determined by the Circuit to be not infringed or invalid. The most interesting part of the case is that while the patent was in litigation and the patentee was prevailing as to injunctive relief and contempt, the PTO invalidated the claims at issue in a reexamination proceeding. In Fresenius the Circuit held that a non-final money judgment of damages for infringement must be set aside where the judgment rested on a patent claim that the PTO had found invalid. Thus, the invalidation of the patent claim precluded the patentee from recovering damages in Fresenius. Similarly here, the civil contempt sanctions must be set aside.
A JMOL of noninfringement is affirmed because there was no legally sufficient evidentiary basis on which a reasonable jury could have found that BlackBerry infringes the asserted claims. In so holding, the Circuit rejects the arguments of mFormation that the district court altered claim construction after the verdict was rendered, that claim construction was incorrect in that it limited the steps to the order in which they were claimed, and that there was substantial evidence to support the verdict.
Applying the “clear abuse of discretion” standard of review, a split panel denies a writ of mandamus that would have ordered the E.D. of Texas to transfer case to the N.D. of California.
The Circuit rules that the E.D. of Texas abused its discretion in denying a motion to transfer an action to the E.D. of Michigan.
Apple and Toyota show that regardless of how confident we are in our position on a motion to transfer, we nonetheless have to disclose our case strategies early on and review, in exhaustive detail, the particular witnesses and documents that will be used to defend a case brought in a remote forum. It also shows the value in bringing a case in a forum of your client's choosing, whether for patent infringement or declaratory judgment, as to achieve a transfer the defendant will have to lay out its evidence far earlier than it otherwise would have to do so. In Toyota AVS simply alleged it was based in Texas without identifying any witnesses that had pertinent evidence. Yet such evidence probably existed.
The Circuit determines that the Eastern District of Texas abused its discretion in denying a motion to sever and transfer a patent infringement case against Nintendo and its customers to the Western District of Washington when all of the identified witnesses reside in the transferee forum.
The district court did not abuse its discretion in sanctioning a law firm $200,000 under Rule 11 where its arguments in support of claim construction violated all of the applicable canons of construction and its arguments of infringement had no reasonable basis.
The Circuit refuses to throw out a judgment despite finding the court-appointed mediator acted improperly by failing to disclose “an endearing social relationship” with a law firm and attorney who represented the defendants in the mediation and in the subsequent trial.
An inventor and his company lack standing to challenge the constitutionality of the first-to-file provision of the AIA because plaintiffs fail to show actual or imminent injury, fairly traceable to the challenged action. The panel rejects plaintiffs’ argument that they were subjected to increased risk of hacking because they had to spend less money on computer security due to the increased costs associated with additional patent filings required under the first-to-file system. Other arguments relating to costs associated with increased filings were also rejected as not being fairly traceable to the first-to-file provisions of the AIA.
A divided panel rules on the lack of sufficient controversy to support subject matter jurisdiction where declaratory judgment actions were based on infringement actions against a customer.
Judge Rader dissents from the majority’s ruling as to Microsoft’s action on the ‘402 patent based on his feeling that the majority viewed each fact in isolation instead of considering a totality of the circumstance. “The unfortunate consequence of this decision creates a roadmap to avoid declaratory judgment when it may be most valuable to resolve disputes early and efficiently.”
The Circuit reverses the dismissal of a declaratory judgment action filed the day a patent issued based upon pre-patent-issuance conduct by the patentee. A unanimous panel refused to accept the “bright line” rule that activity prior to issuance of a patent cannot give rise to a justiciable controversy. Citing MedImmune the panel noted that the Supreme Court has repeatedly found the existence of an actual case or controversy even in situations in which there was no indication that the declaratory judgment defendant was preparing to enforce its legal rights. The Court has instead only “required that the dispute be definite and concrete….”
Here Novozymes’s claim covering genetically modified enzymes was the sole claim of its patent and is the same claim that Novozymes described during prosecution as interfering with the claim in a Danisco patent. Novozymes twice asserted that Danisco’s patent covering similar subject matter was invalid and that Novozymes, not Danisco, was entitled to a patent on the claimed invention. Novozymes has twice sued Danisco or its predecessors for patent infringement regarding related products, once on the day its patent issued. Novozymes has never withdrawn its allegation that Danisco’s variant is encompassed by the claim that issued in Novozymes’s patent.
According to the panel, Danisco was in the position of either abandoning its product or running the risk of being sued for infringement, which is precisely the situation that the Declaratory Judgment Act was intended to remedy.
A declaratory judgment action is dismissed for lack of subject matter jurisdiction where the sole basis for the action was that the defendant claimed he had written the patent application for the patent at issue, but never claimed he was an inventor.
An NPE’s writ of mandamus relating to the remand of a case that was removed to federal court is denied because the Circuit lacks jurisdiction. Therefore, Vermont’s action contending that patent infringement demand letters violated consumer protection laws will be litigated in state court.
The State of Oregon has addressed this issue a little differently. Oregon’s law, signed into law on March 3 of this year, prohibits a person or its affiliate from communicating a patent-infringement demand if it alleges, asserts or claims in bad faith that the recipient has infringed or contributed to infringing a patent or rights that the patentee, assignee or licensee has under patent. The statute permits prosecuting attorneys to make findings regarding whether the accusing entity has acted in bad faith. The prosecuting attorneys may also serve investigative demands or take enforcement actions under the Unlawful Trade Practices Act related to bad-faith demands. The law also prescribes criteria for findings of bad-faith and good-faith claims, requiring prosecuting attorneys to tell the accused if a claim was made in bad faith within 10 days and only permits recipients to sue for damages once a finding has been made that a claim was made in bad faith. For a good discussion of the statute see Patent Troll Legislation by Julianne R. Davis. AIPLA Newsstand, Aug. 14, 2014.
A majority of the panel reverses as an abuse of discretion the district court’s refusal to stay an infringement case pending post-grant review under the AIA’s business method patent review program.
The statute instructs the district court to consider the following four factors when deciding whether to grant a stay:
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The statute further provides that the Circuit shall review the district court’s decision to ensure consistent application of established precedent, and such review may be de novo. §18(b)(2).
Becton Dickinson must pay a $5 million award, despite the fact that the infringement verdict was partially reversed in a prior appeal, since Becton never argued for lower damages in the earlier appeal. "While this court regularly issues remands when requested and appropriate, or on our own initiative if some but not all products are found on appeal not to infringe, there is no 'normal rule' giving district courts the authority to … recalculate damages that fall within our mandate." Becton argued that fairness requires relief but in response, the Circuit reiterates that the company had fair opportunity to raise the damages issue in the
prior appeal. "To permit this issue to be revisited anew would be to endorse an end-run around the mandate rule, which we are not about to do.”
In an opinion that discusses claim preclusion, issue preclusion and the Kessler Doctrine, the Circuit affirms the district court’s dismissal of a subsequent case brought against the same defendant for the same imaging system found not to infringe in a prior action. In doing so the panel relied not on claim preclusion as the district court had, but instead on the so-called Kessler Doctrine. The panel also ruled that none of the foregoing doctrines precludes an action alleging infringement by equipment that was different from that found to infringe in the prior action, and was introduced after the judgment in the earlier case.
Based on this case, the Kessler Doctrine will undoubtedly be a part of every future claim and issue preclusion discussion.
If a patent is found invalid in a final judgment, it can constitute collateral estoppel as to the invalidity of a second patent. The issue is whether the patentability issues are substantially the same, not whether the claim language is different.
In the second claim preclusion case in the past week, a divided panel affirms the dismissal of Senju’s patent infringement case based on claim preclusion. Apotex filed an ANDA with the FDA, asking for permission to sell a generic version of Gatifloxacin eye solution. In response, Senju filed suit for patent infringement. The district court found the asserted claims to be invalid as obvious. Senju filed for and received a reexamination certificate amending claims that had been invalidated, and then filed a second action based upon the reexamined claims. The district court granted Apotex’s motion to dismiss the second case based on claim preclusion. Senju appealed, contending this was not the same cause of action litigated in the first case since the claims were substantially different.
The majority of the panel disagreed with Senju that differences in the claims were critical to claim preclusion. According to the opinion, the claims that emerge from reexamination do not in and of themselves create a new cause of action.
Even though the patentee was barred from filing an infringement suit due to the license agreement, the Supreme Court felt that the public interest in maintaining a well-functioning patent system should not favor changing the ordinary burden of proof rule in patent cases.
This case deals with a dispute over whether certain implantable heart simulators sold by Medtronic are within the scope of a patent that had been licensed from Mirowski to Medtronic. The ultimate issue for the Court was which party had the burden of proving infringement - the licensee/declaratory judgment plaintiff or the patentee/declaratory judgment defendant. The Federal Circuit acknowledged that the patentee normally bears the burden of proof, but held that where the patentee is the declaratory judgment defendant and is foreclosed from asserting infringement by the continued existence of a licensing agreement, the declaratory judgment plaintiff bears the burden of persuasion.
The Supreme Court felt this was an arbitrary distinction, and one that did not justify making such a definitive change in the way declaratory judgment cases are tried. Citing Medimmune v. Genentech, Inc., 549 U.S. 118, 128 (2007), the Court found that there was no convincing reason why burden of proof case law should favor the patentee. Here, Medtronic followed the procedure set forth in Medimmune, which held that a patentee does not need to stop paying royalties, and thereby subject itself to the risk of a patent infringement suit, in order to file a declaratory judgment action. Even though Mirowski was barred from filing an infringement suit due to the license agreement and Medtronic's continued payment of royalties into an escrow account, the Court felt that the patentee should still bear the burden of proof cases.
The Circuit vacates denial of JMOL as to anticipation because defendant failed to move after presentation of the evidence, but affirms the grant of JMOL on an unjust enrichment claim and the grant of a new trial on anticipation.
In a split decision the Circuit reverses the granting of a motion for summary judgment of noninfringement as to four patents in suit. The panel finds issues of fact as to the first three patents based on its conclusion that certain evidence should not have been excluded, and that the district court improperly resolved factual issues against the non-moving party. The dissent disagrees with the court as to claim construction on the fourth patent.
This opinion provides a helpful analysis of the use of “plain meaning” in claim construction. In the construction of “enhance,” the panel finds no support in the specification for what might otherwise be considered the plain meaning of the term. With respect to the construction of “single record” the panel determines that the specification needs to be clear in order to override the plain meaning of a claim term.
In a split decision the Circuit vacates summary judgment that Tyco’s infringement claims were not a sham, therefore remanding for a determination of whether the sham exception to Noerr-Pennington immunity is applicable. The panel also vacates the summary judgment that Tyco’s citizen petition to the FDA was not a sham.
The majority of the panel ruled that the patentee’s infringement action following an ANDA filing could give rise to antitrust violations as “sham litigation.” The majority further held that the Citizen’s Petition–alleged to contain baseless allegations of non-equivalence, filed by patentee following a finding of non- infringement, could also give rise to antitrust liability. Judge Newman wrote in dissent that the patentee has a statutory right to file an infringement suit after it receives notice of an ANDA certification. She also wrote that the patentee has a constitutional right to file a Citizen’s Petition that should trump any speculative antitrust-based claims for damages.
The decision recognizes that the presumption of validity for a patent holder creates a high bar for a party claiming sham litigation based on invalidity. The dissent’s argument that a patentee may, as a matter of law, rely on the presumption of validity to defeat a sham litigation claim was not accepted by the majority, so the opinion makes it clear that the presumption can be overcome.