Posts in Federal Circuit

Partners Joe Robinson and Bob Schaffer have for some time published a Federal Circuit Review Newsletter. I have been a subscriber since they started publishing that newsletter just over a year ago. I pitched Joe and Bob with the idea of publishing their weekly newsletter on IPWatchdog.com. They liked the idea. Thus, I am pleased to announce that beginning Friday, June 26, 2015, IPWatchdog.com will publish the Troutman Sanders newsletter each Friday.

There can be little doubt of the exceptional importance of Akamai Technologies, Inc. v. Limelight Networks, Inc. to the intellectual property community, and to innovators as a whole. The issue of joint infringement has been the focus of much discussion in recent years by academia, the media, and industry. In its 2014 remand of this case, the Supreme Court suggested this Court would have the opportunity to “revisit the § 271(a) question if it so chooses,” 134 S. Ct. 2111, 2120 (“Akamai III”). The AIPLA, as amicus curiae, argues that the Federal Circuit should choose to do so by rehearing the case en banc because the single entity rule as set out by the Panel majority would make it nearly impossible for certain patent holders to enforce their patents against joint infringers.

The opinion focused on whether adequate structure corresponding to the “coordinating” function is disclosed in the specification. After determining that a special purpose computer is required to perform the function, the court searched for an algorithm for performing the function, but did not find one. The court rejected Williamson’s argument that the distributed learning control module controls communications among the various computer systems and that the “coordinating” function provides a presenter with streaming media selection functionality. The disclosures relied upon by Williamson were thought of by the court as merely functions of the distributed learning control module and opined that the specification does not set forth an algorithm for performing the claimed functions.

Functional claim language is increasingly being used by practitioners to capture the metes and bounds of an invention, especially in computer-implemented inventions. Sometimes using functional language in a claim limitation is unavoidable. Functional language does not, in and of itself, render a claim improper. However, as recently experienced in Williamson v. Citrix (en banc) and Robert Bosch, using functional language carries a significant risk of having the claim invalidated as indefinite following a determination that the claim invokes § 112(f) even when the patentee does not intend to have the claim treated under § 112(f).

The opinion provides guidance in terms of when divided infringement actually imposes liability for patent infringement. When a mastermind offloads one or more steps of a claimed method to another entity, then the actions of that other entity are vicariously attributed to the mastermind only if the relationship is one of a principal-agent or joint enterprise, or if there is a contract between the parties requiring or mandating the other entity to perform the offloaded method step. Whether other terms that limit the vicarious nature of a contract might impose liability will have to be litigated in the future.

In a unanimous vote the Senate Judiciary Committee approved the Stoll nomination, which now moves on to the full Senate. If confirmed Stoll would take the vacant spot created by the retirement of Judge Randall Rader.

There’s been a lot of positive activity in recent months for Bristol-Myers Squibb of New York City. In early March, the U.S. Food and Drug Administration approved the use of BMS’s immunotherapy drug Opvido for the treatment of lung cancer. The approval came ahead of schedule after a clinical trial of the drug was ended due to a significant improval in survival rates. In the early days of April, the company announced a partnership with Dutch-based pharmaceutical developer uniQure that will see BMS pay uniQure $254 million for the successful development of a genetic therapy for congestive heart failure. Also in early April, BMS finalized the acquisition of Flexus Biosciences, a California firm focused on developing anti-cancer therapeutics.

Two independent errors warrant reversal, but to be fair, the district court did not have the benefit of the Supreme Court’s decision in Teva. Now, the Federal Circuit has the opportunity to address the interplay of Teva with claim construction in design patents. This is a much needed clarification.

Apparently, despite the fact that there are strict page limits imposed at the Federal Circuit, Soverain was somehow supposed to fully brief all of the issues directly raised by Newegg, as well as all of the issues an activist Federal Circuit could possibly imagine. To call this a ridiculous burden doesn’t begin to scratch the surface. The Federal Circuit is depriving Soverain of property rights without due process, period. The lack of process afforded Soverain both in the Newegg case and in the Victoria Secret case should shock everyone.

It would be extremely unsettling if the Supreme Court has weakened Judge Lourie’s resolve to independently and properly interpret the Patent Act. If there is another explanation for his flip-flop on matters of patent eligibility I would love to hear it, but so far an explanation for diametrically different opinions has not been forthcoming. I don’t expect Judge Lourie to make a speech or hold a press conference like a politician, but if he is going to make diametrically opposite decisions in the same case, on the same facts, relating to the same claims, he owes litigants and the industry an explanation. Without an explanation it makes the entire process seem nothing more than arbitrary and capricious.

Writing for the panel majority, Judge Dyk, who was joined by Judge Clevenger, explained that regardless of whether the USPTO properly should have instituted an IPR, the decision of the USPTO could not be reviewed or challenged even after a completed IPR proceeding. Further, the CAFC found that the broadest reasonable interpretation standard is appropriate in IPR. Judge Newman dissented.

While there are several facets of willful infringement law that the Halo concurrence would have the full court reconsider, the one that could have the greatest impact, and potentially unwind the patent reform gains made by Seagate, is the substantive test for award of enhanced damages under 35 U.S.C. § 284 for willful infringement.

The United States Court of Appeals for the Federal Circuit has had a very long love affair with de novo review, a standard whereby the reviewing appellate court can simply do whatever they want without giving any deference to the district court judge or the jury. It isn’t much of an exaggeration to say that the Federal Circuit does what they want, when they want, how they want, and they have rarely let the standard of review get in the way. That was until today. Assuming the Federal Circuit follows the Teva decision as they are supposed to and as they have mindlessly followed other recent Supreme Court decisions in Myriad, Mayo and Alice, the Federal Circuit’s application of the de novo review standard to everything will come to an abrupt end.

Truthfully, the Supreme Court decision in Alice can only be described as an intellectually bankrupt. The Supreme Court never once used the word “software” in its decision. The failure to mention software a single time is breathtaking given that the Supreme Court decision in Alice will render many hundreds of thousands of software patents completely useless. Ironically, at the end of the day, software patent claims written in typical, industry standard format will result in patent ineligible claims. Yet, at the same time, business methods are patentable. To call this bizarre and inconsistent doesn’t begin to scratch the surface.