Source: https://patentplanetblog.blogspot.com/2014/03/
Timestamp: 2019-04-25 08:49:02+00:00

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Today, the U.S. Supreme Court held an oral hearing in Alice Corporation v. CLS Bank International which will determine the patent eligibility standard for computer-implemented inventions.
Here's a copy of the written transcript of the oral hearing.
Here's a copy of the audio of the oral hearing from The Oyez Project at IIT Chicago-Kent College.
Here's Columbia law professor Ronald Mann's summary of the hearing: Argument analysis: Justices seeking path between Scylla and Charybdis for financial services patent in SCOTUSblog.
The USPTO published the latest version of the Manual of Patent Examining Procedure (MPEP), 9th Edition on March 28, 2014.
The MPEP is based on the USPTO rules, 37 Code of Federal Regulations, federal court cases, and federal patent law, Title 35 of the United States Code.
The MPEP informs patent attorneys, agents, and examiners how to interpret rules and laws in detailed situations that arise during prosecution of a patent application in the PTO. For example, Chapter 2100 of the MPEP tells how to persuade an examiner as to the basis for granting a patent for a given US patent application. I have found it helpful in my practice as a patent attorney.
As a follow up to USPTO - Public Hearings on Proposed Attributable Ownership Rules, Professor Feldman of UC Hastings Law School sent a link to her written testimony on the proposed attributable ownership rules on March 26, 2014.
Professor Feldman persuasively argues why it is important to identify the parties to a transaction. As she puts it: "shell games and hide-and-seek rarely make for an efficiently functioning market." She also points out the asymmetry in discovery that allows patent trolls to assert patents and obtain nuisance settlements as part of why transparency is important.
I don't see a reasonable argument in favor of allowing parties to purposely cloak ownership. However, from my perspective as a patent attorney, the proposed rules to identify patent ownership numerous times would impose a burden on many patent owners. It may help solve an aspect of the patent troll problem, but at a significant cost. For example, a patent term running 20 years from the filing date can "out live" management of a tech company, the inventors, and the patent attorneys. Thus typical discontinuity that can occur multiply times during the patent term will impose an administrative burden to ensure ownership changes are promptly reported over the patent term. The time we need to know attributable ownership is when monetizing activity ensues (e.g., licensing negotiations or patent infringement suit filed or threatened).
It will be interesting to see if the USPTO modifies the proposed rules as they appear likely to raise patent prosecution costs for all and result in patent loss for what may be in many cases an inadvertent mistake.
The Patent Trial and Appeal Board (PTAB) is hosting roundtables regarding America Invents Act patent trials at eight locations in April - May 2014. America Invents Act (AIA) patent trials (inter partes review, post-grant review, and covered business method review) can significantly reduce the cost of challenging patent validity. The Silicon Valley roundtable will be hosted at Santa Clara University. See links below for details. The USPTO is hosting the roundtables and webcasts for free.
As stated in the notice the PTAB roundtables will "share information about the new AIA trials (i.e., inter partes reviews, post grant reviews, covered business method reviews, and derivations) including statistics, lessons learned, and techniques for successful motions practice. The Board is interested in receiving feedback about the trials and will feature a panel discussion to elicit public input. At each roundtable, at least five administrative patent judges will participate and be available for questions and conversation."
USPTO - Been Sued or Gotten a Demand Letter?
In July 2013, President Obama, upon being informed about abusive patent litigation, directed the USPTO "to empower those who have received a demand letter or may be threatened with a patent lawsuit with information about their options." In response, the USPTO recently published an online toolkit for defendants: Been Sued or Gotten a Demand Letter? that gives strategies, options, legal resources, a glossary and private resources such as Lexa Machina and RPX.
What should we expect now that we are leaving the world of procuring patents to the topic of patent litigation? Do you think the USPTO will provide an online toolkit for US patent owners "Is Your Patent Being Infringed?" that gives strategies, options, legal resources, and private resources such as Intellectual Ventures and contingency fee law firms to help patent owners license and enforce patents?
Professor Sichelman - The Vonage Triology: A Case Study in "Patent Bullying"
University of San Diego Law Professor Ted Sichelman published an interesting article The Vonage Trilogy: A Case Study in "Patent Bullying" on February 18, 2014.
Professor Sichelman tells us "patent bullies are large, established operating companies that threaten or institute costly patent infringement actions of dubious merit against smaller companies, usually in order to suppress competition or garner licensing fees."
Professor Sichelman states "patent bullies have scarcely been discussed in the academic literature or popular press, especially in recent years."
Professor Sichelman examines Sprint, Verizon and AT&T patent infringement suits against Vonage, a startup providing Internet telephone services. Yes, whatever happened to Vonage? The article says the patent infringement suits sank Vonage. How many startups are hampered not by patent trolls but by the incumbents' patents? We should figure this out, because incumbents patent portfolios may not just capture innovation, but generate a patent thicket for startups seeking to enter the marketplace. Congress should take a look at patent bullying -- is Vonage an isolated instance or an all too frequent occurrence?
USPTO prioritized examination enables an applicant to get a final decision on patentability of an application within 12 months.
Prioritized examination can be made for original applications (Track One) and for a request for continued examination (RCE).
The USPTO fees for prioritized examination are $1,000 for a micro entity, $2,000 for a small entity, and $4,000 for a large entity. Legal fees are typically small, because the request form is easy to complete and more importantly requires no pre-filing search.
Although prioritized examination limits requests to applications with no more than four independent claims and 30 total claims, most US patent applications fit within the limits.
In a backlogged field such as software where delays in initial examination can stretch over years, prioritized examination can result in competitive advantage.
Caveats: if the invention lacks patentability, prioritized examination will rapidly inform of the unhappy news, which may not be consistent with a wish to merely report "I have a patent pending." It also will front-load the prosecution fees.
See USPTO Prioritized Patent Examination Program for the request form, a quick guide, the final rules for prioritized examination, and some FAQs.
Also see the USPTO Notice Changes to Permit Delayed Submission of Certain Requirements for Prioritized Examination.
The USPTO has alerted the community that Oracle's first version of Java 8 may cause authentication issues for users of Private PAIR and EFS-Web. If Java 8 is an issue, the USPTO says revert to Java 7 update 51.
"Oracle has announced that the first version of Java 8 will be released on Tuesday, March 18, 2014. This version will not be an automatic update, however if you install Java 8 and encounter authentication issues, you will need to revert to Java 7 Update 51.
USPTO technical teams are coordinating closely with Oracle and Entrust for a solution.
Contact the Patent EBC at 1-866-217-9197 (toll-free) or ebc@uspto.gov if you need further assistance."
In Verderi, LLC v. Google, Inc., the Federal Circuit vacated a judgment of non-infringement of four U.S. patents owned by Verderi, LLC because the district court erred in claim construction.
On October 15, 2010, Vederi LLC sued Google alleging Google Street View infringed U.S. Patent No. 7,239,760, U.S. Patent No. 7,577,316, U.S. Patent No. 7,805,025, and U.S. Patent No. 7,813,596 describe methods for creating synthesized images of a geographic area that can be displayed on a computer.
As background, Google Street View produces images and view that are curved or spherical, and never flat because it combines images of a wide range of views recorded by multiple cameras having wide-angle lenses mounted on a moving vehicle. Those photographs are overlapping pictures taken from a single location at approximately the same time. These images are stitched together into a virtual spherical composite image. The resulting image is a two-dimensional representation of a spherical shape.
retrieving from the image source a second image associated with the second location (emphasis added).
In the Markman hearing, Google argued "views being substantially elevations of the objects" in claim 1 required "vertical flat (as opposed to curved or spherical) depictions of front or side views." Verderi stated that it merely meant "front and side views of the objects." The district court stated the patents "did not disclose anything about spherical views" and entered summary judgment in favor of Google.
The Federal Circuit stated when it interprets claims it relies primarily on intrinsic evidence: the claim language, the specification, and the prosecution history and apart from the claims, the specification is the single best guide to the meaning of a claim term. After considering the intrinsic evidence, a court may seek guidance from extrinsic evidence, but should understand it may be less reliable than intrinsic evidence (quotations and citation omitted).
The Federal Circuit noted that the district court erred by not relying the intrinsic evidence: (1) the claims broadly recited "substantially elevations," but the court adopted an architect's strict definition of an elevation view, which read "substantially" out of the claims; (2) Figure 16 of the patents depicted buildings with depth and perspective not just front and side, which is more than an elevation view; and (3) The specification described taking a photo with a fish-eye lens, which produces photos which are not flat and not an elevation.
After reading the opinion, I think the specification was contrary to Google's "substantially elevations" = "flat images" argument at the Markman hearing so the decision was not surprising. On the other hand, using a relative term such as "substantially" in a claim is not risk free as it may raise an indefiniteness defense.
As we approach the oral hearing in Alice Corp. v. CLS Bank, many companies are filing amicus briefs to influence the Supreme Court's views on patent eligibility of computer-implemented inventions. See the ABA Supreme Court Preview: 41 amicus briefs (3 briefs support petitioner, 16 support respondent, and 21 briefs favor neither party).
The question presented: "Whether claims to computer-implemented inventions-including claims to systems and machines, processes, and items of manufacture-are directed to patent-eligible subject matter within the meaning of 35 U.S.C. § 101 as interpreted by this Court?"
For additional information see Donald Chisum's Article - Patents on Computer-Implemented Methods and Systems and U.S. Supreme Court Grants Certiorari in Alice v. CLS Bank.
This week Juniper Networks failed to convince a jury that Palo Alto Network's PA-500, PA-2000, PA-4000 and PA-5000 Series Firewalls infringe US Patent No. 7,779,459, US Patent No. 7,650,634, and US Patent No. 7,302,700.
Juniper claims Palo Alto firewalls are based on intellectual property (IP) that Juniper obtained when it paid $4 billion for Netscreen in 2004. Juniper claims Palo Alto knew all about this infringement given Nir Zuk now at Palo Alto, developed the firewalls with Yuming Mao, when they worked at Netscreen.
Professor Tanenbaum says firewalls are the I/O police that inspect data packets on computer networks. The data packets are routed to a "digital drawbridge." Data packets meeting requirements are forwarded into the "castle" and those that don't are "unceremoniously dumped in the moat." In short, firewalls keep the "good bits" (e.g., confidential information) inside the network and keep the "bad bits" (e.g., viruses, worms and other digital pests) outside of the network.
Juniper says Mr. Zuk was a key developer of the IP in question, so it's curious he is not a named inventor of the '459 patent or the '700 patent given US law requires naming all inventors, but the articles don't say much more to support an improper inventorship defense. Juniper might argue assignor estoppel bars that invalidity challenge, but Palo Alto should be able to file a petition for inter partes review to sidestep assignor estoppel.
Juniper immediately promised to refile this lawsuit, but what's the likelihood the jury will rule in favor of Juniper after a mistrial? It reminds me of a boxer immediately claiming a punch that landed didn't hurt. The larger the protest, the more it hurt. Not to say we know the mistrial stung Juniper, but its insistence it wants to keep go another round may suggest a bluffing boxer on the way out.
On March 4, 2014, the USPTO published a memorandum, Guidances for Determining Subject Matter Eligibility of Claims Reciting Or Involving Laws of Nature, Natural Phenomena, and/or Natural Products.
As stated in the memorandum "the new procedure set forth in the Guidance will assist examiners in determining whether a claim reflects a significant difference from what exists in nature and thus is eligible, or whether a claim is effectively drawn to something that is naturally occurring, like the claims found ineligible by the Supreme Court in Myriad."
As some commentators have pointed out the US Supreme Court is not the origin of the "significant difference test," but as a practical matter I expect many applicants in the chemical and biotech industries will be required to show how the claims are significantly different than the judicial exceptions to persuade examiners that the claims are patent eligible under 35 USC 101.
The USPTO will hold public hearings to get input on the proposed attributable ownership rules on March 13 and 26, 2014. The USPTO is apparently addressing the criticism regarding the lack of public input and the likely impact of these proposed rules. Losing a valid patent due to someone missing a change in ownership is draconian even if you have the right to petition against that result. It will be interesting to see if the USPTO modifies the rules in response as they appear likely to raise patent prosecution costs and may result in loss of patent rights for what will be in many cases an inadvertent mistake.
"The public is invited to attend the hearings in person or via Webcast. Additionally, the public is invited to give testimony in person at the hearings and/or to submit written comments about the proposed rules. The deadline for requesting to give testimony has been extended to Wednesday, March 12, 2014, and the deadline for submitting written comments has been extended until Thursday, April 24, 2014.
Design patents have become an important topic in US patent law. Formerly viewed as the "weak sister" of utility patents, the large damage awards in design patent infringement cases such as Apple v. Samsung have a way of changing everybody's mind.
Congress sometimes establishes laws that in theory should be helpful but for a variety of reasons fail to get much use such as the preissuance submission provision of the America Invents Act (AIA).
Preissuance submissions became available about a year and half ago. They allow a third party to submit prior art in a patent application.
The USPTO received 1,414 preissuance submissions as of January 17, 2014. Note this is a fraction given the USPTO Patent Dashboard states 600,053 applications are in the unexamined backlog as of January 2014. In any event, the largest number of submissions were filed in Technology Center (TC) 1700, which relates to mechanical engineering. Surprisingly, the fewest were filed in TC 2400, which relates to electrical engineering.
"Figure 1 below shows the distribution of submissions across technology centers.
Most third-party submissions received as of January 17, 2014, have met the eligibility requirements and been categorized by the Office as proper. Figure 2 below shows the percentage of proper and improper submissions, and Figure 3 below shows the proper submissions categorized by technology areas. The most common reasons for non-compliance relate to a failure to meet the timing, concise description of relevance, and signature requirements. Statistics show, however, that the number of improper submissions is leveling off, and in turn, that the number of proper submissions is rapidly increasing.
In the total number of proper preissuance submissions received as of January 17, 2014, the public presented 3,339 documents for consideration by the Office. Figure 4 below shows the submitted documents categorized by type.
When the Office receives a compliant preissuance submission in a particular application, the examiner must consider the submission as a matter of course. For the submissions made as of January 17, 2014, examiners have relied upon the prior art contained in them to make a rejection in 12.50% of the impacted applications. Figure 5 below depicts all the applications where a rejection issued after a proper submission was received. Additionally, in the applications where rejections were made based upon the art contained in a preissuance submission, the examiner rejected 50% of the time for obviousness under 35 U.S.C. 103; 18% of the time for anticipation under 35 U.S.C. 102; and the remainder of the time for both obviousness and anticipation. Figure 6 below features the applications having rejections using third-party submissions broken down by the type of rejection under the statute. Lastly, with respect to the type of rejection made after receipt of a proper third-party submission, most were First Actions on the Merits followed by Final Rejections.
The public has shown interest in locating potential prior art for submission to the Office by utilizing crowdsourcing Web sites, such as Ask Patents by Stack Exchange. Indeed, members of the public have been posting requests for prior art in published applications on these sites. The Office feels confident that the number of proper third-party submissions will continue to increase as users become more familiar with the ability to make such submissions as well as the resources available to locate prior art such as crowdsourcing. The Office will continue to monitor the number third-party submissions and periodically update statistics on these filings."
The USPTO did a decent job showing what is happening with preissuance submissions, but what is missing is a graph that shows if the rate of filing preissuance submissions is increasing over the last year and a half. Without this it is hard to share the USPTO's confidence submission will increase. I have felt the risk is you give up your prior art in an ex parte environment, which will not allow you to participate, plus alert the application owner that "somebody cares" which may lead to the application owner filing one or more continuations which could cause problems down the road.
Today, the award of attorneys fees is a hot issue in patent law. 35 USC 285 states that "the court in exceptional cases may award attorney fees to the prevailing party," but courts rarely award attorneys under 35 USC 285. Thus, some corporations are lobbying Congress to redefine that standard to increase the risk of paying "humongous" attorney fees to cut off patent licensing / troll activities.
Redefining the standard may just generate uncertainty and not help long term. Another approach is to wait for the Supreme Court to clarify the standard. Last week the Supreme Court conducted hearings to consider the substantive standard for awarding attorney fees in Octane Fitness and the standard of review for appeals in Highmark.
I started to read through the Supreme Court hearing transcripts this weekend, but found a nice argument recap by Columbia law professor Ronald Mann Justices hard to read in twin disputes about attorney's fees in patent litigation, which can help one navigate where we are going in this area of the law.

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