Source: https://patentplanetblog.blogspot.com/2016/10/
Timestamp: 2019-04-25 08:49:07+00:00

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The USPTO is proposing to change the rule on the duty of disclosure of prior art in examination of patent applications and reexamination of patents. For details see the Federal Register Notice.
The Trademark Trial and Appeal Board Rules (TTAB) has amended its rules of practice for all cases pending on or filed after January 14, 2017. For the amended rules see Notice of Final Rulemaking (NFRM) and summary chart.
In Medtronic, Inc. v. Robert Bosch Healthcare Systems, Inc., the Federal Circuit recently held a Patent Trial and Appeal Board (PTAB)'s decision to discontinue an inter partes review (IPR) due to the petitioner's failure to disclose the real party is not reviewable on appeal under 35 U.S.C. § 314(d). Section 314(d) states "The determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable."
The Federal Circuit found nothing contrary in the Supreme Court's decision in Cuozzo Speed Technologies, LLC v. Lee stating the "Board's vacatur of its institution decisions and termination of the proceedings constitute decisions whether to institute inter partes review and are therefore 'final and nonappealable' under § 314(d)."
Today, the USPTO announced its Patent Quality Forum Series in a variety of locations in November 2016. This is an opportunity to learn about USPTO efforts to increase patent quality.
Today, the USPTO notified that "PTAB AIA review decisions are now available daily at the AIA Review Decisions webpage, which displays the current and previous business day’s decisions. The reports will be updated twice a day at 11 a.m. and 4 p.m. ET and do not include Derivation proceedings."
Brian Love of Santa Clara University Law School and James Yoon of Wilson Sonsini Goodrich & Rosati's article Predictably Expensive: A Critical Look at Patent Litigation in the Eastern District of Texas to be published in the Stanford Technology Law Review is worth review.
"In this Essay, we compare U.S. patent litigation across districts and consider possible explanations for the Eastern District of Texas’s popularity with patent plaintiffs. Rather than any one explanation, we conclude that what makes the Eastern District so attractive to patent plaintiffs is the accumulated effect of several marginal advantages — particularly with respect to the relative timing of discovery deadlines, transfer decisions, and claim construction — that make it predictably expensive for accused infringers to defend patent suits filed in East Texas. These findings tend to support ongoing efforts to pass patent reform legislation that would presumptively stay discovery in patent suits pending claim construction and motions to transfer or dismiss. However, we also observe that judges in the Eastern District of Texas tend to exercise their discretion in ways that dampen the effect of prior legislative and judicial reforms that were aimed (at least in part) at deterring abusive patent suits. Given the broad discretion courts have to control how cases proceed, this additional finding suggests that legislation restricting venue in patent cases may well be the single most effective reform available to Congress."
Richard Lloyd's post on IAM blog: Despite recent CAFC decisions, say some, a strong case remains for legislative action on Section 101 is worth reading if you are wondering if software related inventions are still eligible for US patents -- the short answer is yes.
Today, the USPTO published a proposed rule: Rule Recognizing Privileged Communications Between Clients and Patent Practitioners at the Patent Trial and Appeal Board (PTAB).
"This proposed rule would amend the rules of practice before the Patent Trial and Appeal Board to recognize that, in connection with discovery conducted in certain proceedings at the United States Patent and Trademark Office (USPTO or Office), communications between U.S. patent agents or foreign patent practitioners and their clients are privileged to the same extent as communications between clients and U.S. attorneys. The rule would apply to inter partes review, post-grant review, the transitional program for covered business method patents, and derivation proceedings. This rule would clarify the protection afforded to such communications, which is currently not addressed in the rules governing Board proceedings at the USPTO. This new rule will not affect the duty of disclosure and candor before the Office under 37 CFR 1.56.
Comment date: The Office solicits comments from the public on this proposed rulemaking. Written comments must be received on or before December 19, 2016 to ensure consideration.
Comments should be sent by electronic mail message over the Internet addressed to: acprivilege@uspto.gov.
Comments may also be submitted by postal mail addressed to: Mail Stop OPIA Director of the United States Patent and Trademark Office, P.O. Box 1450, Alexandria, VA 22313-1450, marked to the attention of "Soma Saha, Patent Attorney, Patent Trial Proposed Rule on Privilege."
The USPTO is conducting two roundtables on patent subject matter eligibility. See Federal Register Notice or press release.
The first roundtable will discuss how the USPTO can improve subject matter eligibility guidance and the training examples. It will be held at the USPTO headquarter in Alexandria, VA at 1-5 pm ET on November 14. To attend or participate as a speaker in the first roundtable.
The second roundtable will discuss the Supreme Court decisions on patentable subject matter. It will be held at Stanford University at 8 am - 5 pm on December 5. To attend or participate as a speaker in the second roundtable.
Each of the USPTO satellite offices will participate in these roundtables.
Professor Ronald Mann's blog post Justices cautious about resolving Samsung-Apple dispute over design of cell phones indicates the Supreme Court was unsettled at the oral hearing on the legal standard to apply to the $400 million damages awarded for Samsung's infringement of Apple's design patents.
The case turns on the proper interpretation of 35 USC 289 stating: "whoever during the term of a patent for a design, without license of the owner, (1) applies the patented design ... to any article of manufacture for the purpose of sale, or (2) sells or exposes for sale any article of manufacture to which such design or colorable imitation has been applied shall be liable to the owner to the extent of his total profit ...."
As Professor Mann stated: "The issue is whether the 'article of manufacture' to which the infringing design feature has been applied is the cell phone itself (as the court of appeals concluded) or some difficult-to-specify subsidiary portion of the phone, perhaps the case or exterior."
The Federal Circuit previously decided the article of manufacture is Samsung's phone, but all at the Supreme court hearing seem to agree it's too much to conclude "the article of manufacture" for calculating profits is the entire phone. We have the infringement of design patents that show the exterior screen and case. Should that infringement include the value of thousand of features in the software/hardware inside? I don't think so but it is also important to consider what drove the sale. I think just talking about how much physical structure is shown in the design patent misses this. Whatever way you come out, I think design patent damages is important to fairly resolve in an environment where injunctive relief is not awarded even when a competitor appears to have applied design patent to its product.
Scott Flanz's article Octane Fitness: The Shifting of Patent Attorneys' Fees Moves Into High Gear published in the Stanford Technology Law Review is worth reading.
"In 2014, the United States Supreme Court decided Octane Fitness. LLC v. ICON Health Fitness, LLC, significantly altering the standard for granting attorneys' fees shifting at the close of a patent litigation. Combine with precedent announced on the same day in Highmark Inc. v. Allcare Health Management Systems, scholars have opined that under the new regime, the standard for proving entitlement to attorneys’ fees in patent litigations will be considerably relaxed. Despite the widespread acceptance of the viewpoint, few empirical analyses—if any—have objectively confirmed it.
This paper provides a first glimpse into whether the Supreme Court’s decision in Octane changed the attorneys’ fees standard in practice. By investigating the rate at which courts have granted attorneys’ fees motions before and after Octane, broken down by whether the movant was a patentee or accused infringer, the technology of the patent asserted, the circuit and district where the suit was decided, and what factors were considered by each court in its opinion, this research confirms that Octane’s reinterpretation of § 285 has had observable effects. In particular, this study finds a statistically significant increase in the rate of attorneys’ fee shifting after Octane, particularly for motions filed by accused infringers and in motions concerning electronics and software patents. The results of this study shed light on meaningful and recent changes to the patent litigation incentive structure and will be helpful in predicting future changes to the patent litigation landscape."
The Federal Trade Commission (FTC) published a report that investigates patent assertion entities (PAEs) that acquire patents then try to monetize them and makes recommendations for patent reform.
"This report is a big step forward in enhancing our understanding of PAEs and provides an empirical foundation for ongoing policy discussions,” said FTC Chairwoman Edith Ramirez. The recommendations we are proposing are designed to balance the needs of patent holders with the goal of reducing nuisance litigation.
The report, Patent Assertion Entity Activity: An FTC Study, examines non-public information and data covering the period 2009 to 2014 from 22 PAEs, 327 PAE affiliates, and more than 2100 holding entities (those entities that did not assert patents) obtained through compulsory process orders (subpoenas) using the agency’s authority under Section 6(b) of the FTC Act.
The report found two types of PAEs that use distinctly different business models. One type, referred to in the report as Portfolio PAEs, were strongly capitalized and purchased patents outright. They negotiated broad licenses, covering large patent portfolios, frequently worth more than $1 million.
The second, more common, type, referred to in the report as Litigation PAEs, frequently relied on revenue sharing agreements to acquire patents. They overwhelmingly filed infringement lawsuits before securing licenses, which covered a small number of patents and were generally less valuable.
The report found that, among the PAEs in the study, Litigation PAEs accounted for 96 percent of all patent infringement lawsuits, but generated only about 20 percent of all reported PAE revenues. The report also found that 93 percent of the patent licensing agreements held by Litigation PAEs resulted from litigation, while for Portfolio PAEs that figure was 29 percent.
The study found that the royalties typically yielded by Litigation PAE licenses were less than the lower bounds of early stage litigation costs. This data is consistent with nuisance litigation, in which defendant companies decide to settle based on the cost of litigation rather than the likelihood of their infringement.
provide sufficient notice of these infringement theories as courts continue to develop heightened pleading requirements for patent cases.
The report examined the types of patents held by PAEs, and found that 88 percent were in the information and communications technology sectors; more than 75 percent of those patents were software-related patents.
To gain a better understanding of how PAE behavior compares with the behavior of other firms that assert patents, the report also looked at the wireless chipset sector, examining how reported PAE assertion behavior compared to certain manufacturers and non-practicing entities (NPEs) (who primarily seek to develop and transfer technology ). For this study, the FTC obtained non-public data from eight manufacturers and five NPEs, for the same timeframe using its 6(b) authority.
The wireless case study found that Litigation PAEs and manufacturers behaved differently. Within the study, Litigation PAEs brought far more infringement lawsuits involving wireless patents—nearly two-and-a-half times as many as manufacturers, NPEs, and Portfolio PAEs combined. Litigation PAE licenses involved simple lump-sum payments with few restrictions, if any, whereas the reported manufacturer licenses frequently included field-of-use restrictions, cross-licenses, and complicated payment terms.
This new report furthers the Commission’s commitment to addressing patent policy issues, that began with its 2003 report, To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy, and continued with its 2011 report, The Evolving IP Markeplace: Aligning Patent Notice and Remedies with Competition."
On September 30, a federal jury ordered Apple to pay $302.4 million for its infringement of VirnetX's patents relating to virtual private networks and secure communications links.
This retrial occurred after Judge Schroeder vacated VirnetX's $625.6 million win over Apple in a previous trial, because jurors may have been confused. The patents are complex, and even if not it appears patent litigation with big money at stake is likely to stretch for years. As noted, Apple's continued fight may have saved over $300 million less its attorney's fees.
Today in Apple v. Samsung Electronics the Federal Circuit reinstated a $199.6M jury verdict for Samsung's infringement of Apple's US Patent Nos. 5,946,647, 8,046,721, and 8,074,172 because the verdict was supported by substantial evidence in the record and the trial court didn't err in denying Samsung's judgment as a matter of law (JMOL).
"We granted Apple's en banc petition to affirm our understanding of the appellate function as limited to deciding the issues raised on appeal by the parties, deciding these issues only on the basis of the record made below, and as requiring appropriate deference be applied to the review of fact findings. There was no need to solicit additional briefing or argument on the question of whether an appellate panel can look to extra-record extrinsic evidence to construe a patent claim term. “The Supreme Court made clear that the factual components [of claim construction] include ‘the background science or the meaning of a term in the relevant art during the relevant time period.’” Teva Pharms., Inc. v. Sandoz, Inc., 789 F.3d 1335, 1342 (Fed. Cir. 2015) (quoting Teva Pharms., Inc. v. Sandoz, Inc., 135 S. Ct. 831, 841 (2015)). After Teva, such fact findings are indisputably the province of the district court. ... We likewise did not need additional briefing or argument to determine that the appellate court is not permitted to reverse fact findings that were not appealed or that the appellate court is required to review jury fact findings when they are appealed for substantial evidence. The panel reversed nearly a dozen jury fact findings including infringement, motivation to combine, the teachings of prior art references, commercial success, industry praise, copying, and long-felt need across three different patents. It did so despite the fact that some of these findings were not appealed and without ever mentioning the applicable substantial evidence standard of review. And with regard to objective indicia, it did so in ways that departed from existing law.
The dissents, and Judge Dyk’s dissent in particular, raise big questions about how aspects of the obviousness doctrine ought to operate. But no party—at the panel or the petition for rehearing en banc stage—invited this court to consider changing the existing law of obviousness. We did not take this case en banc to decide important legal questions about the inner workings of the law of obviousness."
See Gene Quinn's IP Watchdog article Federal Circuit recognizes its role as only an appellate court in Apple v. Samsung and Susan Decker's Bloomberg article Apple Wins Appeal Reinstating $199.6M Samsung Verdict.
Stanford Program in Law, Science & Technology and Samsung Electronics are co-sponsoring a conference: The Changing Patent Landscape 8:30 am - 4:15 pm tomorrow.
Here's the details: "The patent system has gone through some dramatic changes in the last decade. This conference will explore the impact of those changes on patent litigation, patent prosecution, and management, and will look at alternatives to patent protection.
o What Does the Future Hold?
o Judge Leonard Davis, Fish & Richardson P.C.
o Judge Christa Zado, Silicon Valley USPTO"
It is free and open to the public at the Paul Brest Hall, Munger Graduate Residences.
"The High Tech Law Institute at Santa Clara Law is pleased to partner with Unified Patents, Inc. in hosting a 2016 Corporate Intellectual Property Strategy Conference at Santa Clara on November 17, 2016. The conference will focus on PTAB trends and updates, patent quality and validity data, the current status of patent pools and standard-essential patents, as well as the secondary market for buying and selling patents.
The conference will take place from 1:00 pm to 5:30 pm on November 17, 2016 and is complimentary but requires registration. For more information and to register online, visit the event page."
The USPTO is proposing to increase fees. See the Federal Register Notice of Proposed Rulemaking (NPRM).
"The Patent and Patent Trial and Appeal Board (PTAB) organizations continue to identify ways to deliver increasing value to the global intellectual property community. The USPTO has made tremendous progress reducing overall patent pendency, reducing our inventory of unexamined applications, enhancing patent examination quality, reducing the ex parte appeal inventory, and implementing the post-grant review proceedings established by the America Invents Act (AIA). While great progress has been made, there is still much to be accomplished.
After consultation with the Patent Public Advisory Committee (PPAC), several key Patent organization fees have only modest increases, e.g.,utility filing, search, examination, and issue fees; others have slightly larger increases, e.g., design filing, search, examination, and issue fees. Small and micro entity fees remain in place to foster innovation among small businesses and independent inventors. Maintenance fees remain unchanged. We propose to increase slightly the request for continued examination (RCE) fees to better align them with our costs. Other fee proposals affect excess claims, information disclosure statement (IDS) submissions, and Office of Enrollment and Discipline (OED) fees among others. A full list of fee change proposals is available on the USPTO’s Fee Setting and Adjusting website.
A 60-day public comment period has now opened, and we welcome feedback from our stakeholders. After reviewing the comments, we plan to prepare a final rule for publication during the summer of 2017. Comments on the fee proposals are due by December 2, 2016."

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