Other Barks & Bites for Friday, October 20: PhRMA Warns of IRA’s Impacts on Cancer Moonshot, VirnetX Dealt Fresh Blows at the Federal Circuit, and Copyright Office Begins Section 1201 Rulemaking

This week in Other Barks & Bites: the Court of Justice of the European Union rules that criminal sentencing for trademark infringement cannot be disproportionate to the offense committed; the Federal Circuit affirms several Patent Trial and Appeal Board (PTAB) decisions invalidating VirnetX patent claims underlying a nine-figure jury verdict in U.S. district court; PhRMA tells the White House that the implementation of the Inflation Reduction Act will impede the Biden Administration’s actions on the Cancer Moonshot; a joint EPO-EUIPO study shows that European startups obtaining IP rights have much greater success in obtaining early stage funding; and the Copyright Office begins its ninth triennial rulemaking under the DMCA for exemptions to rules against circumventing technological measures for protecting copyrighted material.

Bites

CAFC Affirms PTAB’s Invalidation of Patents Underlying $503 Million Jury Verdict for VirnetX – On Friday, October 20, the U.S. Court of Appeals for the Federal Circuit issued decisions in VirnetX Inc. v. Apple Inc. and VirnetX Inc. v. Cisco Systems, Inc., both of which affirmed decisions by the Patent Trial and Appeal Board invalidating patent claims underlying a $502.6 million damages award for VirnetX entered by an Eastern Texas jury in 2018. The Apple and Cisco Systems decisions mooted other VirnetX appeals from the PTAB, which were dismissed in per curiam decisions also entered by the Federal Circuit on Friday.

Federal Circuit Issues Precedential Ruling on Claim Construction – On Thursday, October 19, the U.S. Court of Appeals for the Federal Circuit (CAFC) reversed-in-part a Patent Trial and Appeal Board ruling based on the Board’s claim construction analysis of certain claims challenged by ABS Global, Inc. in an inter partes review of Cytonome/ST, LLC’s U.S. Patent No. 10,583,439. ABS argued on appeal that the PTAB’s finding that it had failed to prove the claims unpatentable was based on an erroneous construction of a limitation common to all of the challenged claims. The CAFC rejected the Board’s construction, reversed the final written decision with respect to two claims and vacated the decision with respect to three other claims.

CJEU Rules That Five-Year Prison Sentence is Disproportionate to Trademark Offense – On Thursday, October 19, the Court of Justice for the European Union (CJEU) issued a ruling on a question presented by Bulgarian courts finding that, while trademark offenses may be classified as criminal and EU countries can pass legislation imposing a custodial sentence, Bulgarian legislation imposing a five-year minimum sentence for unauthorized use of a trademark was contrary to EU law for being disproportionate to the offense committed.

Divided CAFC Panel Finds Fraud in Incontestability Status Cannot Cancel Trademark – On Wednesday, October 18, the U.S. Court of Appeals for the Federal Circuit issued a precedential decision in Great Concepts, LLC v. Chutter, Inc. in which the majority of the appellate panel ruled that 15 U.S.C. § 1064’s provisions on canceling trademark registrations that were fraudulently obtained do not cancel already registered marks obtaining incontestable status due to submission of a false declaration. Dissenting from the majority was Circuit Judge Jimmie Reyna who wrote that “this court should be wary not to excuse fraud that is undertaken at any stage within an administrative process.”

PhRMA Letter Warns White House About Harmful Impacts of IRA on Cancer Moonshot – On Tuesday, October 17, Pharmaceutical Research and Manufacturers of America (PhRMA) sent a letter addressed to Dr. Danielle Carnival, Deputy Assistant to President Biden for the Cancer Moonshot, and signed by more than two dozen pharmaceutical company executives warning the Biden Administration about the negative impacts that the Inflation Reduction Act’s (IRA) provisions on government price setting will threaten “the continued investment and R&D necessary to evaluate the full therapeutic value” of FDA-approved medicines.

EPO-EUIPO Study Shows EU Startups With IP 10x More Likely to Secure Funding – On Tuesday, October 17, the European Patent Office (EPO) and the European Union Intellectual Property Office (EUIPO) released the results of a joint study into the impact of intellectual property rights on European startups showing that, while only 29 percent of EU startups secure any IP rights, those that do are 10 times more likely to successfully secure early stage funding.

Second Circuit Reverses Summary Judgment in ‘All The Way Up’ Copyright Case – On Tuesday, October 17, the U.S. Court of Appeals for the Second Circuit issued a decision in Elliott v. Cartagena in which the appellate court reversed a grant of summary judgment against plaintiff Eric Elliott’s claims that he co-wrote the 2017 Fat Joe and Remy Ma single “All The Way Up.” The Second Circuit held that it was improper for the Southern District of New York to find that Elliot’s discovery requests prior to summary judgment were futile simply because there was no original copy of an agreement that existed to refute a draft copy entered into evidence and purporting to show that Elliott’s rights in the song were transferred.

Barks 

Copyright Office Begins Ninth Triennial Section 1201 TPM Circumvention Rulemaking – On Thursday, October 19, the U.S. Copyright Office issued a notice of proposed rulemaking (NPRM) in the Federal Register indicating that the agency had begun the ninth triennial rulemaking under the Digital Millennium Copyright Act’s provisions regarding exemptions to rules against the circumvention of technological protection measures as codified at 17 U.S.C. § 1201.

Copyright Office Extends Comment Period on Electronic Deposits for LoC Collections – On Wednesday, October 18, the U.S. Copyright published an extension of comment period in the Federal Register indicating that the agency was extending until October 30 the public comment period in connection with an NPRM previously published by the Office proposing regulations for electronic deposits of published works that have been selected for addition to the collections of the Library of Congress. 

Second Circuit Affirms Dismissal of Indirect Copyright Infringement Claims Against YouTube – On Tuesday, October 17, the Second Circuit issued a summary order in Business Casual Holdings, LLC v. YouTube, LLC in which the appellate court agreed that Business Casual had not plausibly alleged that YouTube did commit contributory or vicarious infringement of three-dimensional renderings of historical scenes for documentary videos on American business tycoons John Rockefeller and J.P. Morgan.

Lengthy ITC Report on COVID-19 IP Waiver Covers Little New Ground – On Tuesday, October 17, the U.S. International Trade Commission (ITC) issued a report on proposals for waiving international treaty obligations for intellectual property rights related to COVID-19 diagnostics and treatments, mainly reiterating talking points from either sides of the debate without providing recommendations.

Ninth Circuit Remands DJ for Netlist on Termination of Development and License Agreement – On Tuesday, October 17, the U.S. Court of Appeals for the Ninth Circuit issued an unpublished opinion in Netlist Inc. v. Samsung Electronics Co., Ltd. in which the appellate court reversed grants of partial summary judgment and declaratory judgment entered in the Central District of California on Netlist’s contract claims. The Ninth Circuit remanded to the district court to resolve ambiguities in the language of a joint development and license agreement to properly determine Samsung’s supply obligations.

This Week on Wall Street

Chinese Restrictions on Graphite Exports Expected to Impact EV Battery Market – On Friday, October 20, top Chinese commerce and customs officials announced that the country would be instituting restrictions on exports of graphite, a form of carbon in high demand for its application in electric vehicle (EV) batteries, threatening the supply chain for the more than 90 percent of the world’s supply of graphite that is refined in China. 

Quarterly Earnings – The following firms identified among the IPO’s Top 300 Patent Recipients for 2022 are announcing quarterly earnings next week (2022 rank in parentheses):

• Monday: Hyundai Motor Co. (19th); Koninklijke Philips N.V. (49th); ZTE Corp. (132nd)
• Tuesday: 3M Co. (t-85th); Alphabet Inc. (15th); Corning Inc. (89th); Dow Inc. (126th); Ford Motor Co. (27th); Fujitsu Ltd. (67th); General Electric Co. (28th); General Motors Co. (57th); Halliburton Co. (t-44th); Microsoft Corp. (18th); Verizon Communications Inc. (t-61st); Visa Inc. (141st): Xerox Holdings Corp. (176th)
• Wednesday: Boeing Co. (t-36th); Innolux Corp. (t-208th); Samsung Electronics Co., Ltd. (1st); Thermo Fisher Scientific Inc. (190th); United Microelectronics Corp. (182nd); Western Digital Corp. (58th); Whirlpool Corp. (t-166th)
• Thursday:com, Inc. (16th); Boston Scientific Corp. (88th); Bristol-Myers Squibb Co. (252nd); Canon Inc. (5th); Capital One Financial Corp. (59th); Comcast Corp. (104th); Fuji Electric Co., Ltd. (206th); Honeywell International Inc. (56th); Intel Corp. (12th); Juniper Networks, Inc. (153rd); Mastercard Inc. (144th); Merck & Co. (238th); Resmed Inc. (259th); Samsung SDI Co., Ltd. (151st); Seagate Technology plc (t-184th); STMicroelectronics N.V. (77th); Textron Inc. (t-170th); AB Volvo (t-173rd)
• Friday: Exxon Mobil Corp. (156th); Hitachi Ltd. (20th); Komatsu Ltd. (t-246th); LG Electronics (3rd); Omron Corp. (t-173rd); Sanofi S.A. (t-210th); Seiko Epson Corp. (32nd); Shin-Etsu Chemical Co., Ltd. (t-203rd)