Source: http://comparativepatentremedies.blogspot.co.il/2016/02/
Timestamp: 2017-07-21 22:34:28
Document Index: 349708923

Matched Legal Cases: ['EWCA ', '§ 2', '§ 2', '§ 2', '§ 2', '§ 154', '§ 154', '§ 154', '§ 4', '§ 4', '§ 154', '§ 154', '§ 287', '§ 287', '§ 154', '§ 154', '§ 154']

Comparative Patent Remedies A Blog Devoted to the Comparative Law and Economics of Patent Remedies Monday, February 29, 2016
case is Design & Display Ltd v Ooo Abbott
& Anor [2016]
EWCA Civ 95, an appeal from a 2014 decision of the Intellectual
Property Enterprise Court. (Hat tip to Norman Siebrasse for calling this
appellate decision to my attention. I blogged about the 2014 IPEC
decision here.) The patent in suit concerns "display panels used in shops" (para. 3),
claim 1 of which is reproduced in para. 4 and the "inventive concept"
of which was summarized by the trial judge (Justice Birss) as "not just the
idea of an insert made of a resilient metal (which was known)," but rather
"the composite idea of an insert made of such a metal and its
having a particular shape and its interacting with the slot of the panel
in a particular way, such that the metal insert could engage with the panel by
snap-in means" (para. 9). The Court of Appeal (per Lord Justice
Lewison) framed the appeal as presenting two issues:
first main question raised by the appeal is whether Design & Display are
liable for the whole of the profits made on the sale of panels sold together
with infringing inserts. The second main question is whether Design &
Display are entitled to set off any part of their general overheads against the
gross profit for which they are accountable (para. 6).
the first issue, the trial court had awarded the defendant's entire profit on
sales of infringing displays, on the theory that although only some consumers
bought the displays because of the inventive concept of the patent in suit, the
defendant was "going to make a sale of inserts and panels both, or no sale at
all. . . . Because the sales went together, the sale of the inserts caused (in
the relevant sense) the sale of the panels in which they were incorporated. It was
also foreseeable that the sale of the panels would be a consequence of the sale
of the inserts" (para. 30). The Court of Appeal disagreed, however:
me revert to the example given by the Full Court in Dart
Industries Inc v Decor Corp Pty Ltd. A manufacturer sells a car which
includes a patented brake. If the car did not have brakes, the manufacturer
could not have sold it, but it did not have to have that particular brake. In
those circumstances the Full Court clearly thought that it would be unjust to
charge the manufacturer with the whole profit made on the car; and I agree with
them. In my judgment the legal error that the judge made was to ask whether the
sale of the panel plus insert would have happened separately rather than to ask
himself how much of the profit on the sale was derived from the infringement.
In a case in which the infringement does not "drive" the sale it
seems to me that it is wrong in principle to attribute the whole of the profit
to the infringement. In particular it does not follow from the fact that the
customer wanted a slat wall that incorporated an insert that the
customer wanted a slat wall that incorporated the infringing insert. Mr
Cuddigan argued that the infringing inserts and the slot were the "very
essence" of the incorporated and unincorporated panels. But the judge made
no such finding, and his observations at [32] suggest the contrary. In addition
I do not consider that the judge was correct at [31] in saying that "because
the sales went together, the sale of inserts caused … the sale of the
panels…" The mere fact that the two went together is not, in my judgment,
sufficient to establish that the whole of the profit earned on the composite
item was derived from the invention. One might just as well say that the sale
of the panel caused the sale of the insert. As the judge himself recognised the
customer specifies panels, and on the hypothesis that he was considering
at [31] the customer is indifferent about the inserts (provided that some form
of insert is included). On the judge's approach, because the sale of the
patented brake went with the sale of the car, the whole of the profit on the
car would be included in the account. If the judge had found on the facts that
the infringing insert was "the essential ingredient in the creation of the
defendant's whole product" (i.e. the incorporated panel), then he would
have been justified, on the facts, in declining to apportion the profit. But I
cannot see that he made that finding.
my judgment therefore in cases simply falling within the factual
hypothesis discussed at [31] the judge should have apportioned the overall
profit. The question of apportionment will therefore have to be returned to
IPEC, although the judge would not be precluded from finding as a fact that the
infringing insert was the "essential ingredient" of the incorporated
panel (paras. 36-37). In
my opinion, Lord Justice Lewison is right to require apportionment of the
defendant's profit where the patent did not drive demand for the defendant's
product, because otherwise the defendant is being required to disgorge more
than the value of the patented invention to it: it's being required to
disgorge profits that are properly attributable to other features. With
all due respect, however, the principle actually cuts deeper than the court
seems to recognize. From an economic perspective, the value of the
invention to the defendant is only the surplus profit the defendant earned over
and above what it would have earned from the use of the next-best available
noninfringing technology. Unfortunately, the House of Lords over a
century ago in United Horse-Shoe & Nail Co. v. John Stewart &
Co. (1888) L.R. 13 App. Case 401 held that the fact that the defendant
could have resorted to a noninfringing alternative is irrelevant to the amount
of the plaintiff's lost profit, and in Celanese Int'l Corp. v. BP Chemicals
Ltd. [1999] R.P.C. 203 Justice Laddie held that the
same principle applies to awards of defendant's profits. The principle
that noninfringing alternatives are irrelevant necessarily leads to
overcompensation, as I discuss in my book at pp. 110-14, 189-90, 198-203, and
as I have discussed several times on this blog (see here,
and as I further argue at pp. 199-200 of my book, apportionment and the relevance of noninfringing alternatives are
"inseparable concepts." At least Lord Justice Lewison's opinion for
the court undoes some of the damage of ignoring alternatives. As
for the second issue, the court holds that allocable overhead should be
deducted under a wider range of circumstances than Justice Birss believed:
seems to me to be clear that if the infringer would have manufactured or sold
non-infringing products had he not infringed and would have incurred overheads
in supporting that manufacture or sale, then he ought to be allowed a
proportion of his general overheads. The question is not dependent on whether
the infringer is or is not working to capacity. The bottom line is whether (a)
the overheads would have been incurred anyway even if the infringement had not
occurred and (b) the sale of infringing products would not have been replaced
by sale of non-infringing products. It is in those circumstances that an
allowance for overheads will not be permitted (para. 42).
I have noted before (here),
economic analyses of the question of whether courts awarding the defendant's
profit should deduct allocable overhead from the defendant's gross profit are
divided, though I am inclined to agree that as a general matter they should
be. So I think the Court of Appeal got this point right too.
my September 2013 blog post discussing a range of other issues that
policymakers must confront in deciding whether or how to award infringer's
profits, see here. For a critique of the U.S. rule, which (in design patent cases only) awards the
defendant's entire profit, see here.
Just a few months ago a panel of the Federal Circuit (without addressing the merits of the underlying judgment of liability) effectively held that Judge Koh should have entered a permanent injunction (see here and here). Presumably the injunction will now be lifted too. Posted by
My university's library recently received a copy of Transitions
in European Patent Law: Influences of the Unitary Patent Package
(Rosa Maria Ballardini, Marcus Norrgård & Niklas Bruun eds., Kluwer Law
International 2015). Part IV is titled Enforcement and Procedural
European Patent Law, and includes chapters by Kelli Larson titled Enforcement: Legal Implications of the European and Unitary Patent Systems for
Non-practicing Entity Patent Enforcement in Europe, and by Marcus Norrgård
and Alicia Nylund titled The Requirements for Preliminary Injunctions in the
Unified Patent Court. Ms. Larson's chapter provides a interesting
discussion of factors that cut both for and against the prediction that the new
system will make Europe more NPE-friendly, while the chapter by Professor Norrgård
and Ms. Nylund contrasts the UK approach to preliminary injunctions (involving
something of a balancing inquiry) with the German approach (involving more of a
prediction as to likelihood of harm). Norrgård and Nylund note that the
relevant legal documents relating to the UPC do not clearly specify which
approach the UPC should take toward preliminary injunctions, and they argue in
favor of an approach (patterned after frameworks developed by Professor John
Leubsdorf and Judge Richard Posner) that they refer to as "inverse
sequential," which would begin "by weighing the interests of the
parties, which in turn would define the standard of proof required. In
short, the graver the consequences for the plaintiff compared with the
defendant's consequences, the lower the threshold for a preliminary injunction,
and the other way around: the greater the harm to the defendant (compared
to the plaintiff's), the higher the threshold." Interesting reading.
Contemporary law and economics has greatly expanded its scope of inquiry
as well as its sphere of influence. By focussing specifically on a comparative approach, this Handbook offers new insights for developing current law and economics research. It also provides stimuli for further
research, exploring the idea that the comparative method offers a valuable way to enrich law and economics scholarship.
With contributions from leading scholars from around the world, the Handbook sets the context by examining the past, present and future of comparative law and economics before addressing this approach to specific issues within the fields of intellectual property, competition,
contracts, torts, judicial behaviour, tax, property law, energy markets, regulation and environmental agreements.
This topical Handbook will be of great interest and value to scholars and postgraduate students of law and economics, looking for new directions in their research. It will also be a useful reference to policymakers and those working at an institutional level. Posted by
The reply briefs of Stryker Corp. and of Halo Corp. were filed on February 12. Thanks to the Scotus Blog, Stryker's reply is available here. I haven't been able to get a copy of Halo's reply yet but will link to it when I can. Also, the last remaining amicus brief that I am aware of, of EMC Corp. in support of respondents, is available here. (This last brief is interesting in that, like the brief filed by Public Knowledge, the Electronic Frontier Foundation, and Engine Advocacy in December, it cites some recent academic literature on forum shopping, in arguing that a return to the pre-Seagate standards for awarding enhanced damages would only aggravate the problem.) The case is set to be argued before the currently eight-member U.S. Supreme Court next Tuesday, February 23. (I'll probably post something on this after I've read the transcript.) For the other briefs that have been filed in this case and my thoughts on the availability of enhanced damages, see here, here, here, here, here, here, here, and here.) I also just learned that American University's Washington College of Law will be hosting a post argument discussion (with live webcast) on Halo and Stryker on Tuesday afternoon at 4:45 p.m., by which time the argument will have been heard and (I expect) the transcript will be out. Here is a link to information on the event. Speakers will include Jonas Anderson, American University Washington College of Law; Donald Dunner, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, Counsel for Respondent,
Zimmer, Inc.; Christopher Seaman, Washington and Lee University School of Law, Counsel for Amici, Intellectual Property Professors, in Support of Neither Party; James C. Otteson, Arnold and Porter, Counsel for Amici, Innovention Toys, in Support of Petitioners; Michael Feldman, Durie Tangri, Counsel for Amici, Internet Companies, in Support of Respondents; and Michael Carroll, American University Washington College of Law (Moderator).
Update: Here is a copy of Halo's reply brief, fresh off the Scotus Blog. Posted by
One of the biggest unresolved legal issues in IP is whether reasonable royalties on domestic use of a patented technology can include extraterritorial sales as part of the royalty base. The resolution of that question, including issues such as whether a sale may
have more than one location, is likely to have far-reaching consequences, not just for damages quantification, but also for where companies choose to conduct their R&D and sales support.
owners and possible infringers face several years of considerable uncertainty. Our panel will clarify the issues and give advice on restructuring license agreements in light of the latest case law. Last year's Federal Circuit decision in Carnegie Mellon v. Marvell is awaiting a new district trial on remand and likely subsequent appeals, but savvy licensors can respond with new royalty structures. Our panel includes a litigator who is involved in long series of cases involving foreign sales; a law professor who studies extraterritoriality; and a damages expert.
Panelists will be Blair Jacobs of Paul, Hastings; Professor Amy Landers of Drexel University; and David Harkavy of the Claro Group. Posted by
2. The IPKat Blog on January 27 published a post titled Storm in a C Cup: Mr Justice Carr Refuses Injunction and Account of Profits in Stretchline v. H&M Spat. The parties had previously settled patent infringement litigation, but the plaintiff later sued the defendant for breaching that agreement by selling allegedly infringing fabric. The court agreed that there was a breach but denied an injunction on the ground that the defendant had stopped infringing and the infringement was unlikely to recur, and also denied a request for an accounting of profits. More recently, on February 2 the blog published a post (authored by Brian Whitehead of Kempner & Partners, which represented the plaintiff) titled Inquiry as to Damages: No Longer a Rara Avis?, discussing a case in which the IP Enterprise Court (which handles relatively small-stakes patent disputes in England & Wales) awarded £0.5 million in lost profits just a few weeks after a December 2015 hearing. The author concludes that "[t]his represents another means by which the IPEC improves access to justice for litigants, particularly for small and medium enterprises." Another post on this case, authored by Emma Muncey and Rachel Mumby of Bristows LLP and titled AP Racing v. Alcon Compone, was published on EPLaw Blog on February 10, and also links to the decision itself. 3. Anders Valentin recently published a post on the Kluwer Patent Blog titled A Matter of Urgency--PI Application Turned Down for Lack of Urgency. The post discusses a Danish case in which the court denied the patent owner, Minkpapir, a preliminary injunction which it applied for in 2015 despite its presumed knowledge that the defendant had been marketing an allegedly infringing product since 2011. As I have mentioned several times before (more recently here), urgency is an important consideration for obtaining a preliminary injunction in Germany too. Posted by
has posted a new paper on ssrn titled Patent Assertion Entities and EU
Competition Law. Here is a
Assertion Entities (“PAEs”) are playing a growing role in the United States,
but also in Europe. Their activities are controversial in that while they may
be a source of efficiencies, they may also create anticompetitive harm. Given
the growing trend of operating companies transferring patents to PAEs in order
to increase their licensing revenues, the risks of anticompetitive harm created
by PAE activities must be taken seriously. When analysing the impact of PAE
activities on competition, a distinction must be drawn between “pure” PAEs,
which acquire patents from a variety of sources and generate revenues by
asserting them, and “hybrid” PAEs, which acquire patents from operating
companies and maintain a relationship with these companies post-acquisition.
While pure PAEs create risks of exploitation, hybrid PAEs create exclusionary
concerns as such PAEs may be used by operating companies to harm their rivals
on downstream product markets. These exclusionary concerns are particularly
serious when the operating company retains a significant degree of control over
the activities of the PAE following the transfer of the patents. As there is
currently no EU competition case-law on the activities of PAEs, this paper
attempts to show through hypotheticals that depending on the circumstances of
each case, privateering may lead to exclusion.
Geradin discusses, among other things, some competing interpretations of the
CJEU's decision in Huawei v. ZTE, and makes some compelling
arguments regarding the extent to which E.U. competition law may place limits
on the practices of both pure and "hybrid" PAEs. Posted by
It's going to take me a little while to get through all 129 pages of the opinions, but initially I'm of the view that the majority is correct at least a matter of policy, particularly on the national exhaustion rule; a regime of international exhaustion, as Lisa Larrimore Ouellette and Daniel Hemel argue here, would threaten to raise the price of drugs in developing countries. Next stop, I feel reasonably certain, will be the Supreme Court, and I'm not at all sure what to expect when the case lands there. Posted by
Federal Circuit Affirms $23 Million Walker Process Damages Award Although for the most part this blog discusses developments in the law of patent remedies--meaning relief available to patent plaintiffs--from time to time I also discuss claims and remedies that may be available to persons who believe they have been falsely or wrongly accused of patent infringement. Both in the U.S. and abroad there are a wide variety of legal doctrines that play a role in resolving this latter class of disputes; and at some point in the future I hope to get back to work on a project addressing the comparative law and economics of wrongful patent enforcement. Anyway, all of this is background to the following discussion of a case decided this morning, TransWeb, LLC v. 3M Innovative Properties Co., in which the Federal Circuit affirmed a judgment of antitrust liability for the assertion of an allegedly fraudulently procured patent (a so-called "Walker Process" claim). The opinion is by Judge Hughes, joined by Judges Wallach and Bryson. The facts in brief are as follows. Plaintiff and defendant are competitors in the market for respirator filters, and at some point both independently developed methods for imparting something called an "electret" characteristic to their filters. At an exhibition in 1997, TransWeb's founder Ogale handed out samples of a filter material his firm had developed. 3M filed a patent application more than a year after this exhibition, eventually obtained two patents, and filed an infringement action against TransWeb. The jury found, however, and the Federal Circuit affirmed, that Ogale's conduct constituted a prior public use more than one year prior to the date on which 3M's application was filed, and that the patents in suit were obvious in view of this prior public use. (I won't review these rulings here.) In addition, the Federal Circuit found no abuse of discretion in the finding that the patents in suit were unenforceable due to inequitable conduct, based on evidence that the inventor and 3M were aware of the prior public use and failed to disclose it properly to the USPTO. (I won't review this ruling either, except to the extent it is relevant to the antitrust claim discussed below. I will note only that the inequitable conduct defense has become more difficult to sustain following the Federal Circuit's 2011 en banc ruling in Therasense.) Finally, the jury concluded that 3M's conduct constituted an act of attempted monopolization in violation of the antitrust laws, based on the alleged fraudulent procurement of the patents. In Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382
U.S. 172 (1965), the U.S. Supreme Court held that enforcing a patent that had been
fraudulently obtained (e.g., by knowingly and willfully making material
misrepresentations to the USPTO) can violate Sherman Act § 2, though only if
all of the other elements of a Sherman Act § 2 claim also are proven. The other elements needed to prove a § 2 monopolization claim are “(1) the possession of monopoly power in the relevant market and (2) the
willful acquisition or maintenance of that power as distinguished from growth
or development as a consequence of a superior product, business acumen, or
historic accident.” United States v.
Grinnell Corp., 384 U.S. 563, 570-71 (1966). To prove a § 2 attempted monopolization
claim, a plaintiff must prove (1) predatory or anticompetitive conduct, (2)
specific intent to monopolize, and (3) a dangerous probability of success. See
Spectrum Sports, Inc. v. McQuillan, 506 U.S. 447, 456 (1993). Both monopolization and attempted
monopolization claims require proof of the relevant market.
Section 4 of the Clayton Act does not provide recompense for any injury causally linked to a violation of the antitrust laws, but rather only for antitrust injury. See Atl. Richfield Co. v. USA Petroleum Co., 495 U.S. 328, 334 (1990); Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489 (1977). TransWeb’s injury-in-fact of $7.7 million must be “attributable to an anti-competitive aspect of the practice under scrutiny” in order to qualify as an antitrust injury. Atl. Richfield, 495 U.S. at 334. Stated another way, TransWeb’s injury-in-fact must “stem[] from a competition-reducing aspect or effect of the defendant’s behavior,” not from competition-increasing or competition-neutral aspects. Id. at 344. 3M’s argument focuses on the fact that the harmful effect on competition proven by TransWeb at trial never actually came about. TransWeb proved at trial that increased prices for fluorinated filter media and respirators would have resulted had 3M succeeded in its suit. However, because TransWeb prevailed, these effects never materialized.
The court finds further support for awarding attorneys' fees spent in defending the patent infringement claim in precedent from other circuits involving sham litigation antitrust claims, and from the policy of encouraging parties to file meritorious antitrust suits. To be honest, I've never given much thought to the question of what appropriate antitrust damages should be for attempted (but unsuccessful) monopolization. As 3M points out, when (as here) the attempt is unsuccessful there may be no exclusion of competitors or higher prices. Nevertheless, I'm inclined to think the court is right: that as long as Congress has proscribed attempted monopolization, the harms a target suffers to fend off the attempt ought to be compensated, and here that harm took the form of almost $8 million in fees. (I imagine there must be some scholarship out there addressing the law and economics of remedies for attempts, with which I should at some point familiarize myself.) Of course, in a system in which prevailing parties are awarded their attorneys' fees as a matter of course, the question of whether fees expended in defense of an unsuccessful infringement claim can be awarded as damages for attempted monopolization might be less relevant--though in reality even in countries that routinely award fees to the prevailing party those fees often are not fully compensatory. Moreover, as the material quoted above indicates, in U.S. antitrust law damages are automatically trebled, so by prevailing on an antitrust claim the successful infringement defendant is awarded much more than just its compensable out-of-pocket fees. As a matter of policy, enhanced damages conceivably make sense for antitrust violations that are hard to detect or that cause harm to a wider population--the optimal deterrence point--but it's never been clear to me why U.S. law awards successful private antitrust claimants treble damages for all types of antitrust violations. Interestingly, in a recent non-antitrust patent infringement action the Federal Circuit vacated an award of double attorneys' fees to a successful defendant, which prompted me to wonder whether there might be circumstances in which courts should award fee multipliers to achieve adequate deterrence (see here). But because it involved a successful antitrust claim, TransWeb is a case in which the prevailing infringement defendant automatically got a fee multiplier. Not sure the distinction makes sense as a matter of policy, but it's probably correct on the law. Posted by
In general.--In addition to other rights provided by this section, a patent
shall include the right to obtain a reasonable royalty from any person who,
during the period beginning on the date of publication of the application for
such patent under section
122(b) . . . and ending on the date the patent is
issued– (A)(i)
makes, uses, offers for sale, or sells in the United States the invention as
claimed in the published patent application or imports such an invention into
the United States; or (ii)
if the invention as claimed in the published patent application is a process,
uses, offers for sale, or sells in the United States or imports into the United
States products made by that process as claimed in the published patent
application; and (B) had actual notice of the
published patent application . . . . (2)
Right based on substantially identical inventions.--The right under paragraph
(1) to obtain a reasonable royalty shall not be available under this subsection
unless the invention as claimed in the patent is substantially identical to the
invention as claimed in the published patent application. . . .
In Rosebud LMS, Adobe moved for summary judgment of no remedies, claiming that Rosebud was not entitled to post-issuance damages because Adobe had discontinued use of the accused technology in January 2013, ten months before the issuance of the ’280 patent. Adobe also asserted that Rosebud was not entitled to preissuance damages under § 154(d) because Adobe had no actual notice of the published patent application that led to the ’280 patent. Rosebud did not oppose Adobe’s motion for summary judgment with respect to post-issuance damages. Instead, Rosebud argued that there remained a genuine dispute of material fact as to whether Adobe had actual knowledge of the published ’280 patent application. Specifically, Rosebud argued that Adobe had actual knowledge of the grandparent patent to the ’280 patent application; that Adobe followed Rosebud and its product and sought to emulate some of its product’s features; and that it would have been standard practice in the industry for Adobe’s outside counsel in Rosebud II to search for the ’280 patent application, which was published before Rosebud II was filed and related to the patent asserted in that suit (pp. 2-3).
The district court granted the motion, on the ground that "Rosebud had not met § 154(d)’s requirement of actual notice because Rosebud’s evidence did not identify the ’280 patent application by number, and was, at best, evidence of constructive notice" (p.3). The Federal Circuit affirms, but in doing so it holds that "actual notice" doesn't necessarily require an affirmative act by the patent owner: We agree with Adobe and the district court that constructive knowledge would not satisfy the actual notice requirement. We do not, however, agree with Adobe that § 154(d)’s requirement of actual notice requires an affirmative act by the applicant giving notice of the published patent application to the infringer. Certainly, “actual notice” includes a party affirmatively acting to provide notice. See, e.g., 58 Am. Jur. 2d Notice § 4 (2015) (defining actual notice as “notice expressly and actually given”); Black’s Law Dictionary 1227 (10th ed. 2014) (defining actual notice as “[n]otice given directly to, or received personally by, a party”). But the ordinary meaning of actual notice” also includes knowledge obtained without an affirmative act of notification. “Indeed, ‘actual notice’ is synonymous with knowledge.” 58 Am. Jur. 2d Notice § 4 (2015) (also explaining that “[a]ctual notice rests upon personal information or knowledge while constructive notice is notice that the law imputes to a person not having personal information or knowledge”).
We have interpreted this latter provision to require “the affirmative communication of a specific charge of infringement.” Amsted Indus. Inc. v. Buckeye Steel Castings Co., 24 F.3d 178, 187 (Fed. Cir. 1994) (citing Dunlap v. Schofield, 152 U.S. 244 (1894)). But we will not read this requirement into § 154(d), where the statute itself does not recite the condition. If § 154(d) contained § 287(a)’s “proof that the infringer was notified” language, our interpretation of § 287(a) would be relevant, and likely dispositive. But that is not the case. Section 287(a) explicitly requires an act of notification, unlike § 154(d), which merely requires “actual notice.” If anything, these differences suggest that we should interpret the two statutes differently. Section 287(a) shows that Congress knows how to use language requiring an affirmative act of notification when it wishes. It could have used that language in § 154(d) and did not. Perhaps there are, as Adobe argues, policy reasons for requiring an affirmative act of notification by the patentee. Requiring the applicant to affirmatively provide notice to potential infringers is in line with the extraordinary nature of statutory pre-issuance damages. Moreover, a strict rule requiring notification by the applicant is simpler to implement and does not leave the accused infringer in the difficult situation of having to rebut allegations that it knew of the published application. If Congress wishes, it can amend the statute to require an affirmative act by the patentee. We cannot. In the absence of such action, we interpret the actual notice requirement of § 154(d) as it is clearly written to have its ordinary meaning (pp. 6-7).
Nevertheless, on the facts, the court agrees that Adobe did not have sufficient notice because (1) the fact that Adobe had knowledge of the '280 Patent's grandfather application does not demonstrate that it had knowledge of the published application that matured into the '280 Patent; (2) the evidence did not show that Adobe was monitoring Rosebud's products, and (3) the evidence did not show that outside counsel necessarily would have come across the '280 application while preparing for litigation between the parties involving an earlier-issued related patent, which litigation never proceeded beyond the claim construction stage. My initial reaction to the court's rule is not positive. I would think that actual notice should be construed to mean just that, notice, not actual knowledge; I think the policy considerations cited by Adobe deserve some consideration; and I'm not all that persuaded by the citations to Am. Jur., though I'll leave it to others for now to track down the source and context of the materials supporting the Am. Jur. quotes. Perhaps the number of cases in which this sort of issue will come up will continue to be small, but I worry that the court has created a potential Pandora's box by permitting damages liability to arise absent an affirmative act by the owner of the pending application. Posted by