Source: https://www.ocipla.org/federal-circuit-summaries-may-2018/
Timestamp: 2018-08-20 03:21:54
Document Index: 669215488

Matched Legal Cases: ['§ 143', '§ 285', '§ 285', '§ 256', '§ 256', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101', '§ 101']

Federal Circuit Summaries – May 2018 | OCIPLA
USPTO Has Standing to Defend Appeal From Inter Partes Reexamination
In Knowles Electronics LLC V. IANCU, Appeal No. 1954, the Federal Circuit determined that the USPTO has standing to intervene to defend its decision, even when the requestor has withdrawn.
Knowles appealed an inter partes reexamination decision of the PTAB, which affirmed an examiner’s findings that the patent claims directed to a silicon condenser microphone apparatus with a housing for shielding a transducer were anticipated or obvious. On appeal, Knowles argued that (i) the PTAB improperly construed “package” and (ii) the PTAB improperly relied on a new ground of rejection to sustain the examiner’s obviousness finding. Third-party requester Analog Devices, Inc. declined to defend the judgment in its favor, and the USPTO intervened.
The Federal Circuit first determined that the USPTO had standing to intervene. The Federal Circuit cited 35 U.S.C. § 143, which gives the Director of the USPTO “an unconditional statutory ‘right to intervene in an appeal from a [PTAB] decision.’” The Federal Circuit then stated that its precedent also allows the USPTO to intervene when the petitioner has withdrawn on appeal, concluding that it necessarily implied jurisdiction.
With respect to the claim construction of “package,” Knowles argued that the Federal Circuit should direct the PTAB to adopt the definition from another case, which construed the term more narrowly. Reviewing the PTAB’s claim construction de novo, the Federal Circuit found that the claim language and specification did not support the narrow construction proffered by Knowles. Furthermore, the Federal Circuit concluded that the extrinsic evidence relied upon by Knowles could not overcome the intrinsic evidence.
Regarding Knowles’s second argument, the Federal Circuit found that the PTAB did not rely upon a new ground of rejection in its analysis because the PTAB’s rejection relied on the same reasons provided by the Examiner. Moreover, because Knowles had a fair opportunity to respond, the PTAB’s rejection did not count as a new ground of rejection.
Judge Newman dissented, concluding that, although the USPTO may have had statutory authorization to intervene, it could not satisfy the constitutional requirements of Article III standing without a showing of an independent USPTO interest or injury.
Jurisdiction Exists When Patent Issues After ANDA Is Filed; Personalized Medicine Claims Held Patent Eligible
Corroborating Evidence Independent of Inventor’s Testimony Needed to Prove Date of Conception
In Apator Miitors ApS v. Kamstrup A/S, Appeal No. 2017-1681, the Federal Circuit held that a party seeking to prove an earlier date of conception using an inventor’s testimony to swear behind prior art must proffer corroborating evidence that does not depend solely on the inventor’s testimony itself.
The Federal Circuit affirmed the Board’s rejection. The Federal Circuit first noted that when a party seeks to prove conception through an inventor’s testimony, the party must proffer at least some corroborating evidence that is “independent of information received from the inventor.” The Federal Circuit found it had to rely exclusively on the inventor’s testimony to learn that the e-mails had attachments, to learn which files were attached, and to determine the creation date of one of the attachments. The Federal Circuit concluded that the inventor’s unwitnessed emails and drawing, alone, could not corroborate his testimony of conception.
Dismissal With Prejudice for Lack of Standing May Lead to Attorneys’ Fees for Defendant
In Raniere v. Microsoft Corporation, Appeal Nos. 2017-1400, 2017-1401, the Federal Circuit held that when a case is dismissed with prejudice for lack of standing, the defendant is the prevailing party for purposes of fee-shifting under 35 U.S.C. § 285.
Mr. Raniere sued Microsoft and AT&T for patent infringement. Raniere asserted he was the sole owner of the patents-in-suit. Years earlier, Raniere and his co-inventors had assigned all rights in the patents to an entity that was dissolved before Raniere sued. Defendants moved to dismiss for lack of standing. Despite the district court providing Raniere multiple opportunities to establish his ownership interest, he failed. The district court found Rainere was “wholly incredible and untruthful,” that he demonstrated “a clear history of delay and contumacious conduct,” and was unlikely to be able to cure the standing defect. The district court dismissed the suit with prejudice and awarded Microsoft and AT&T over $440,000 in fees under 35 U.S.C. § 285.
On appeal, Raniere argued that Microsoft and AT&T were not prevailing parties and the district court abused its discretion in finding the case exceptional. The Federal Circuit held that that Microsoft and AT&T were prevailing parties. Microsoft and AT&T “won” because the dismissal “prevented Raniere from achieving a material alteration in the relationship between them,” and the dismissal “was tantamount to a decision on the merits.” The Federal Circuit also determined the district court did not abuse its discretion in finding the case exceptional and awarding defendants the majority of the requested fees.
Equitable Estoppel Cannot Be Based on Conduct Before Issuance of Claims That Have Been Substantively Amended Through Reexamination
In John Bean Technologies Corporation v. Morris & Associates, Inc., Appeal No. 2017-1502, the Federal Circuit held that pre-reexamination conduct cannot be a basis for equitable estoppel when the asserted claims have been substantively amended and narrowed during reexamination.
John Bean and Morris are competitors in the poultry chiller market. John Bean told Morris’s customers that Morris’s product infringed John Bean’s patent. Morris sent a letter to John Bean challenging the validity of the patent. John Bean received the letter, but never responded. More than ten years later, John Bean filed an ex parte reexamination request and amended the claims. After the reexamination certificate issued, John Bean sued Morris. The District Court granted summary judgement in favor of Morris, finding that John Bean’s suit was barred by equitable estoppel. The District Court relied primarily on Morris’s letter to John Bean as showing that John Bean believed Morris was selling an infringing product and waited years to sue.
The Federal Circuit reversed. The Federal Circuit noted that any invalidity analysis of the original claims did not apply because the reexamined claims had been substantively amended and narrowed. Further, at the time of Morris’s letter, John Bean could not have engaged in misleading conduct or silence with respect to the reexamined claims because they did not issue until years later. Thus, the district court abused its discretion in granting summary judgment based on equitable estoppel.
An Individual Who Was Not Hired to Invent, and Has Not Assigned or Promised to Assign Patent Rights, Has Standing to Establish Ownership of a Patent
In James v. J2 Cloud Services, LLC, Appeal No. 2017-1506, the Federal Circuit held that an individual claiming sole inventorship of a patent has standing under 35 U.S.C. § 256 to establish ownership of the patent, unless he has entered into a contract in which he assigns, or promises to assign, the rights to the patent, or he was “hired-to-invent” such that his employer is entitled to claim his inventive work.
JFAX Communications contracted GSP Software to “develop software solutions for the exclusive use of JFAX.” The contract provided that “JFAX shall become the sole owner of all code and compiled software solutions as described in this Agreement as soon as it is developed, and GSP shall assign to JFAX all copyright interests in such code and compiled software.” James, a GSP partner, developed the software. JFAX later obtained a patent directed at components of that software and named JFAX’s owners as inventors. James sued the current assignee, J2, for correction of inventorship under 35 U.S.C. § 256. J2 filed a motion to dismiss under F.R.C.P. 12(b)(1), alleging that James lacked Article III standing to bring the action. The district court granted the motion, finding that James had assigned, or was obligated to assign, his patent rights under the contract and the “hired-to-invent” doctrine.
The Federal Circuit reversed. With regard to the contract, the court found the contract language could be construed such that it does not assign, or promise to assign, patent rights that would otherwise accrue to James. In particular, the “exclusive use” provision does not convey patent rights, and can be read to encompass only the specific code provided to JFAX, not the underlying patentable methods. Furthermore, the court found that the provision granting JFAX sole ownership of “all code and compiled software” and assigning the copyright interests—but no patent interests—in such code supported the interpretation that no patent rights were assigned.
An Issue Is Not Actually Litigated for the Purposes of Issue Preclusion Where a Party Fails to Present Any Argument or Evidence
In Voter Verified, Inc. v. Election Systems & Software LLC, Appeal No. 2017-1930, the Federal Circuit held that validity under § 101 was not actually litigated for the purposes of issue preclusion where a party failed to present any argument or evidence concerning validity under § 101.
In 2009, Voter Verified sued Election Systems for patent infringement, and Election Systems counterclaimed alleging that the asserted claims were invalid under § 101. The district court found that the asserted claims were not invalid under § 101 after Election Systems failed to present any arguments or evidence concerning invalidity. The district court further found that the asserted claims were not infringed.
In 2016, Voter Verified again sued Election Systems, asserting infringement of the same patent. Election Systems moved to dismiss, once again alleging that the asserted claims were invalid under § 101. Voter Verified argued that issue preclusion (also known as collateral estoppel) barred Election Systems from relitigating validity under § 101. The District Court concluded that the two-step validity analysis recited in Alice, 134 S. Ct. 2347 (2014), constituted a substantial change in the law, such that issue preclusion could not apply. The district court subsequently granted Election Systems’ motion to dismiss, holding that all asserted claims were invalid under § 101. Voter Verified appealed to the Federal Circuit.
The Federal Circuit affirmed the § 101 invalidity holding. As a threshold matter, the court disagreed that issue preclusion could not apply. Rather, the Federal Circuit held that Alice did not alter the law under § 101 because the court applied the same two-step framework it created in Mayo, and Mayo was not intervening—that case was decided when the earlier litigation between Voter Verified and Election Systems was still pending. Nevertheless, the court concluded that issue preclusion did not apply because (1) the § 101 issue was not previously litigated, and (2) the § 101 issue was not critical and necessary to the prior judgment. In the prior litigation, the district court granted summary judgment of no invalidity with no analysis of § 101, because Election Systems failed to present any arguments or evidence on the issue. Moreover, the prior finding of no invalidity was not necessary to the prior judgment because the district court also previously held that Election Systems did not infringe. The Federal Circuit then found the asserted claims invalid under § 101 on the merits.