Other Barks & Bites for Friday, November 1: CAFC Arthrex Decision Makes PTAB Judges Inferior Officers, USPTO Seeks Comments on IP Protections for AI Inventions and Reports to Congress on SUCCESS Act

This week in Other Barks & Bites: the Federal Circuit hands out three precedential decisions; the USPTO sends its SUCCESS Act Report to Congress; the Copyright Royalty Board proposes royalty rates on ephemeral recordings for certain Internet transmissions; China unveils legislation to create a public blacklist for patent offenders; the Ninth Circuit revives a copyright case against Taylor Swift’s “Shake It Off”; Google agrees to buy Fitbit for $2.1 billion; and the USPTO seeks public comments on the type of IP protections that should be extended to inventions developed by AI technology.

Bites

CAFC Decides Appointments Clause Issue at PTAB, Allows APJ Removal – On Thursday, October 31, the U.S. Court of Appeals for the Federal Circuit issued a precedential decision in Arthrex, Inc. v. Smith & Nephew, Inc. in which the appellate court severed the portion of the Patent Act restricting the removal of administrative patent judges (APJs) at the Patent Trial and Appeal Board (PTAB), making APJs inferior officers and not principal officers in order to remedy a violation of the U.S. Constitution’s Appointments Clause.

USPTO Releases SUCCESS Act Report – On October 31, the USPTO sent Congress a report required by the SUCCESS Act of 2018 identifying publicly available data on the participation rates of women, minorities, and veterans in the patent system. The report found that there is limited information on these groups and makes recommendations regarding legislation and initiatives to increase improve participation rates. The Innovation Alliance issued a statement in which Executive Director Brian Pomper said that the report ”highlights the need to expand efforts to promote patenting among women, persons of color, veterans and low-income individuals [and] emphasizes that there is currently insufficient data on the demographic characteristics of inventors and patent holders, making a strong case for enhanced data collection efforts.”

CAFC Affirms Non-Enablement on Idenix Patent, Finds Lack of Written Description – On Wednesday, October 30, the Federal Circuit issued a precedential decision in Idenix Pharmaceuticals LLC v. Gilead Sciences Inc. in which the appellate court affirmed a finding that Idenix patent claims covering a method of treating hepatitis C virus was invalid for lack of enablement. The CAFC also agreed with Gilead’s argument on appeal that the patent claims were also invalid for lack of written description.

Artist Rights Alliance Letter Urges Representatives to Oppose Including Safe Harbors in Trade Deals – The Artist Rights Alliance sent a letter on Tuesday, October 29, to the Chairs and Ranking Members of the House Judiciary and Energy & Commerce committees, urging the committees to continue their pressure on the Trump Administration regarding its “abrupt decision to include language mirroring the current safe harbors [for] new trade agreements.” The safe harbor laws that apply to internet platforms have had some positive effects, but “have clearly failed” in other ways, “and must be updated and reformed to help us create a fairer, safer, and more secure internet for our times – and for the next generation,” said the ARA.

USPTO Seeks Public Comment on IP Protection for AI Innovation – On Wednesday, October 30, the U.S. Patent and Trademark Office published a request for comments in the Federal Register seeking public comments regarding whether copyright, trademark or other IP rights issues that may be impacted by artificial intelligence, such as whether works produced by AI should be considered works of authorship protectable under U.S. copyright law.

Federal Circuit Unseals Decision Vacating PTAB Over Relevance of Patent Copying – On Wednesday, October 30, the Federal Circuit unsealed a precedential opinion in Liqwd, Inc. v. L’Oreal USA, Inc. in which the appellate court vacated a decision by the PTAB to invalidate patent claims covering formulations and methods of keratin treatment as obvious after disregarding a factual finding that L’Oreal used confidential information from Liqwd and copied Liqwd’s patented method to develop its infringing product.

CRB Issues Proposed Royalty Rates for Ephemeral Recordings – This week, the Copyright Royalty Board (CRB) issued a pair of proposed rules published in the Federal Register to set royalty rates and terms for the use of ephemeral, or temporary, recordings in broadcasts. On Tuesday, October 29, the CRB proposed a rule setting minimum royalty rates for certain Internet transmissions of sound recordings by public radio stations. On Wednesday, October 30, the CRB’s proposed rule related to royalty rates for certain Internet transmissions of sound recordings by college radio stations and other noncommercial educational webcasters.

Sen. Cornyn to Gauge Lawmaker Opposition to APP Act – On Tuesday, October 29, Bloomberg Law reported that Senator John Cornyn (R-TX) was planning to bring S. 1416, the Affordable Prescriptions for Patients (APP) Act introduced by Cornyn this May, to the floor of the U.S. Senate in order to gauge public opposition by lawmakers to the act, which would increase Federal Trade Commission (FTC) enforcement authority over certain patent-related activities by pharmaceutical companies.

5G Patent Quality Study Shows Qualcomm, Intel Ahead of Huawei – On Sunday, October 27, Nikkei Asian Review reported that Japanese IP research firm Patent Result released a study on patent quality in the 5G sector which showed that only 21% of patents owned by Chinese telecom giant Huawei were classified as highly innovative, while 32% of Intel’s 5G patents and 42% of Qualcomm’s 5G patents could be classified as such. 

China to Introduce Public Blacklist of Repeat Patent Offenders – On Friday, October 25, China’s National Intellectual Property Administration introduced legislation that will create a public blacklist of individuals and organizations which severely violate the country’s patent laws. The new law, which also includes penalties for violators such as restrictions on advertising and purchasing real estate, will take effect on December 1.

Barks 

INTA-ASIPI Report Shows Impact of Trademarks on Latin American Economies – A report released by the International Trademark Association (INTA) and the Inter-American Association of Intellectual Property (ASIPI), titled “Trademarks in Latin America: Economic Impact in 10 Latin America and Caribbean Countries,” found that sectors using trademarks intensively contribute US $766.6 billion to Gross Domestic Product (GDP) in the 10 Latin American countries surveyed and 35 million jobs.

American Airlines Settles Trademark Case Against Travel Services Firm – On Tuesday, October 29, U.S. District Judge Paul Huck of the Southern District of Florida entered a consent decree and permanent injunction ending a trademark case brought by American Airlines after travel services firm American Assist agreed to no longer use its name and logo as trademarks.

Copyright Lawyer Wants Judge Dismissed Over “Troll” Epithet – On Tuesday, October 29, copyright lawyer Richard Liebowitz filed a request for recusal of U.S. District Judge Lewis Kaplan in a Southern District of New York case after Kaplan referred to Liebowitz as a “troll” for his copyright litigation tactics.

iPhone Cybersecurity Firm Files Counterclaim Against Apple in Copyright Case – On Monday, October 28, Corellium LLC, a company that provides developers with virtual iOS platforms to test for iPhone security flaws, filed a counterclaim in the Southern District of Florida against Apple alleging that Apple’s suit is part of a series of unfair business practices in an attempt to control cybersecurity research for iPhones. 

Google Faces Patent Infringement Suit Over Email Customizing Features – On Monday, October 28, E-Attach LLC filed a patent suit in the Western District of Texas alleging infringement by Google for various email customization features incorporated by Gmail including reminders to add attachments to or provide electronic signatures in emails. 

Nike Files Latest Patent Suit Against Skechers – On Monday, October 28, Nike filed a patent lawsuit in the Central District of California against Skechers, Nike’s fourth recent lawsuit against its sneaker rival, alleging that Skech-Air Jumpin’ Dots and Mega shoes marketed by Skechers infringe on patent claims covering air and cushion inventions developed by Nike.

Ninth Circuit Revives Copyright Suit Over Taylor Swift’s “Shake It Off” – On Monday, October 28, the U.S. Court of Appeals for the Ninth Circuit issued a decision in Hall v. Swift reversing a decision from the Central District of California to dismiss a copyright infringement case filed against pop star Taylor Swift after the appellate court found that the plaintiff’s complaint plausibly alleged the originality of the lyrics infringed by Swift’s 2014 release “Shake It Off” under the Twombly/Iqbal standard.

Southern Florida Judge Denies Netflix Motion to Dismiss “Narcos” Copyright Suit – On Monday, October 28, U.S. District Judge K. Michael Moore of the Southern District of Florida denied a motion to dismiss filed by Netflix and Gaumont Television in a copyright infringement case over the series “Narcos” after deciding that plaintiff Virginia Vallejo’s prior assignment of motion picture rights to her memoir about her relationship with Pablo Escobar didn’t divest the author of copyright for past causes of action for infringement.

This Week in Wall Street

Google Pays $2.1 Billion to Acquire Fitbit – On Friday, November 1, Internet services giant Google and wearable tech firm Fitbit both announced that Google had agreed to buy FitBit in a cash deal worth $2.1 billion. Both companies pledged that Fitbit user data would not be used for Google Ads. 

Facebook Posts Analyst Beat on Revenue, Earnings Per Share – On Thursday, October 30, social media giant Facebook released its earnings report for the third quarter of 2019 during which the company posted revenues of $17.37 billion and earnings per share (EPS) of $1.91, beating analyst estimates on both while growing to 2.45 billion monthly active users and 1.62 billion daily active users.

Quarterly Earnings – The following firms identified among the IPO’s Top 300 Patent Recipients for 2018 are announcing quarterly earnings next week (2018 rank in parentheses):

• Monday: Rambus, Inc. (t-278th); Sprint Corp. (91st)
• Tuesday: Becton, Dickinson and Co. (t-225th); Evonik Industries AG (t-205th); Schaeffler AG (130th)
• Wednesday: Bayerische Motoren Werke AG (t-165); Daikin Industries Ltd. (221st); Olympus Corp. (66th); Qualcomm, Inc. (10th); Sumitomo Rubber Industries, Ltd. (t-173rd); Xperi Corp. (t-197th)
• Thursday: Bridgestone Corp. (t-181st); Casio Computer Co. Ltd. (t-147th); Nikon Corp. (141st); Renesas Electronics Corp. (71st); Siemens AG (21st); Symantec Corp. (t-219th); Terumo Corp. (t-251st); Toyota Motor Corp. (13th); Walt Disney Co. (t-136th)
• Friday: Shimadzu Corp. (t-251st)