Posts in Federal Circuit

Earlier today the United States Court of Appeals for the Federal Circuit issued a decision in Noah Systems, Inc. v. Intuit, Inc. According to the Federal Circuit the specification of the ’435 patent must contain an algorithm that performs the function associated with the “access means” limitation, otherwise the limitation is indefinite and the claim invalid. Ultimately, the Federal Circuit would determine that the algorithm disclosed was incomplete. This lead the Court to explain that when the specification discloses an algorithm that only accomplishes one of multiple identifiable functions performed by a means-plus-function limitation, the specification is treated as if it disclosed no algorithm. An incomplete algorithm means no algorithm as all, which means that what one of ordinary skill in the art would understand from the disclosure is no longer relevant. This is where I would depart from the Federal Circuit and think that the law as it relates to means-plus-function claiming of computer software is all wrong. Means-plus-function claims has always been about what someone of ordinary skill in the art would appreciate (see, for example, USPTO 112 guidelines, 76 Fed. Reg. 7162 (9 February, 2011) so why is that not the case with respect to computer software?

Unfortunately this unspecific remand by the Supreme Court in AMP vacates as well the two-to-one ruling by this same Federal Circuit panel (Judges Lourie and Moore in the majority, Judge Bryson in dissent) that the claimed isolated DNA sequences were also patent-eligible under 35 U.S.C. § 101. What, pray tell, does Mayo Collaborative Services change with regard to that ruling in the original AMP decision? For those, like the plaintiffs in AMP (including the ACLU), who would like to upset this “applecart,” they’re likely to be very disappointed. I can describe what should be the impact of the ruling (and reasoning) in Mayo Collaborative Services on the claimed isolated DNA sequences in three short monosyllabic words: NONE AT ALL. And the Federal Circuit can (and should) say likewise, perhaps in far more words.

The reasoning in Mayo Collaborative Services makes no patent law logical sense on numerous grounds, including disregarding an important paragraph in the Supreme Court’s 1981 case of Diamond v. Diehr that is not only binding precedent, but also tells us that Breyer’s opinion repeatedly does what this paragraph from Diehr says not to do in an analysis of method or process claims under 35 U.S.C. § 101. But the question now becomes what do we do to keep the reasoning in Mayo Collaborative Services from exploding into completely irrational, as well as patent law insane doctrine? The way forward to patent-eligibility rationality, as well as sanity, is through the remand decision in Classen Immunotherapies, Inc. v. Biogen IDEC. Put differently, there may yet be “light” in this currently “dark” patent-eligibility tunnel.

The sky is falling! Those who feel the Supreme Court’s decision in Mayo Collaborative Services v. Prometheus Laboratories, Inc. is terrible are right, although many won’t likely fully apprehend the gravity of the situation at first. Those in the biotech, pharmaceutical and chemical industries have just been taken out behind the woodshed and summarily executed by the Supreme Court this morning. An enormous number of patents will now have no enforceable claims. Hundreds of billions of dollars in corporate value has been erased. But that might be a good thing. Immediate attention now must turn to Congress. Thank goodness that the technical amendments to the America Invents Act are outstanding. This will provide a perfect opportunity for Congress to save an industry that employs many millions of people, while at the same time undoing a pathetic, narrow-minded decision of the Supreme Court.

Where the en banc decision gets particularly interesting (and adversarial) is with respect to the second question, namely when does “intervening rights” apply to reexamined claims? By a 6 to 4 vote, (and a reversal of the panel decision), a majority of the en banc Federal Circuit also concluded “as an alternative ground for affirmance” of the district court’s judgment that “intervening rights do not apply to claims that have not been amended and are not new.” The majority opinion by Judge Lourie (the dissenter in the panel decision) was joined by Chief Judge Rader, and Judges Newman, Bryson, Prost, and Linn (who was one of the 5 “nay” votes on the meaning “biocompatible). The dissenting opinion on the “intervening rights” question by Judge Dyk (who wrote the majority opinion in the panel decision) was joined by Senior Judge Gajarsa (who also joined the majority opinion in the panel decision), Judge Reyna, and Judge Wallach.

In the recently issued case of ClearValue, Inc. v. Pearl River Polymers, Inc., Judge Moore, writing for the Federal Circuit panel, distinguished the holding in the 2006 case of Atofina v. Great Lakes Chemical Corp. In ClearValue, Judge Moore ruled that a process having a claimed raw alkalinity of “less than or equal to 50 ppm” was anticipated under 35 U.S.C. § 102 by a prior art process disclosing an alkalinity of “150 ppm or less.” I believe Judge Moore was correct in ruling that the claimed alkalinity of “less than or equal to 50 ppm” was anticipated by the art disclosed alkalinity of “150 ppm or less.” But her basis for distinguishing Atofina in ClearValue is very problematic in a number of respects, and could create further unnecessary confusion as to when a narrower claimed range in a process is anticipated by a broader range disclosed by the prior art. As illustrated by the ClearValue and Atofina cases, one area where the Federal Circuit sometimes struggles in articulating clear doctrine is when is a narrower claimed range in a process is anticipated under 35 U.S.C. § 102 by a broader range disclosed by the prior art.

The discussion was lively, perhaps even explosive. You could nearly see sparks fly when Chief Judge Rader continued to pepper Seth Waxman with question after question about his opinion on the propriety of parties lobbying the White House in order to obtain a favorable amici brief from the Department of Justice. Rader zeroed in on the slippery slope and obviously is not pleased with the mixing of law and politics, saying: “this is a cause for concern… Politics and law have a divide.” It is indeed troubling that the White House under both President Bush and President Obama have allowed lobbying by parties who seek a favorable DOJ amici brief. Interpretations of the law shouldn’t be for sale, or appear to be for sale to the largest donors.

On September 26, 2011, the a three-judge-panel of the United States Court of Appeals for the Federal Circuit issued a ruling in Marine Polymer Technologies, Inc. v. HemCon, Inc., which found intervening rights due to certain patent claims due to the fact that Marine Polymer made arguments about claim language during reexamination, but without actually amending the claims. See Marine Polymer vacated opinion. On January 20, 2012, the full Federal Circuit decided to hear this case en banc and ordered that the original panel decision be vacated and the appeal reinstated. No additional briefing by the parties was requested, but on January 26, 2012, the Federal Circuit issued an Order allowing amicus briefs to be filed on or before February 10, 2012. On February 10, 2012 the Biotechnology Industry Organization and Pharmaceutical Research and Manufacturers of America filed a joint Amici Curiae Brief supporting the appellee and seeking affirmance of the district court decision.

In what seems to be a continuing trend, the United Stats Court of Appeals for the Federal Circuit is continuing to show increasingly little tolerance for abusive patent litigation tactics. In the most recent pronouncement along these lines the Federal Circuit, per Judge O’Malley (with Judges Newman and Prost joining), ruled the district court appropriately awarded the defendant $3,873,865.01 in attorney fees and expenses under § 285, as well as $809,788.02 in expert fees.

The CAFC’s split panel decision this past week – In re Construction Equipment Company – extends the PTO’s authority to reexamine a patent even where its validity has already been adjudicated and confirmed by the courts. Yet the CAFC once again fails to explain how a PTO reexamination finding that a patent is invalid effects an earlier judicial determination that the same patent is valid and infringed.

The doctrines of “secret prior art” and “inherency” both merged in the case Teva Pharmaceutical Industries Ltd. v. AstraZeneca Pharmaceuticals LP to surprise, and unpleasantly upend the patentee. Judge Linn’s opinion ruled that “[a]n inventor need not understand precisely why his invention works in order to achieve an actual reduction to practice.” Relying upon the collective holdings in Dow Chemical, Mycogen Plant Science, and Invitrogen, the Federal Circuit panel then concluded that “it is apparent that the district court correctly entered summary judgment” of invalidity of the asserted claims in the ‘502 patent under 35 § 102(g)(2).

Lovin has received exceptional attention in the patent law blogosphere. In short, Lovin permits an examiner to wait until an examiner’s answer to explain how and why dependent claims are rejected. What’s worse, Lovin permits the examiner to require the applicant to provide a substantive reason for patentability before the examiner explains the rejection. The Federal Circuit is considering whether to hear In re Lovin en banc, and indeed they should rehear Lovin en banc. The Federal Circuit should defend the applicant’s right to receive a meaningful explanation of claim rejections before the applicant is required to rebut the rejections.

If you think the title only raises a wild possibility, consider what happened in a recent case decided by the Federal Circuit. After being sued for infringement, the defendant had the ex-wife of the inventor of the patent-in-suit sell to it any interest she had in that patent. The defendant argued that as a result there could be no infringement, both because plaintiff lacked standing and because the defendant had acquired an undivided interest in the patent. It almost worked.

I have wondered out loud whether the Judges of the Federal Circuit realize that the outcome is unpredictable until the panel has been announced. It seems that at least some do. How is that defensible? How do others not on the Court not see a problem? The law needs to be certain and predictable and at the Federal Circuit far too many times it is neither. Claims construction is but one of the areas as clear as mud. The Federal Circuit was created to bring certainty to the law, but what has transpired over the course of the last 10 years or so seems to be anything but certainty and stability. For crying out loud a patent is a property right and for any property rights regime to flourish it must be stable and certain! In the words of this generation: OMG!

Since 1993, the United States Patent & Trademark Office (USPTO) has pursued an “aggressive campaign” to free itself from oversight by and accountability to the courts. [1] At the same time, the USPTO has been just as aggressive in ignoring the provisions of the Administrative Procedure Act (APA) and related administrative laws that place responsibilities on the USPTO vis-à-vis the public. Fortunately, most administrative laws provide the public a remedy exercisable against agency overreaching: when an agency skirts its obligations, the agency loses its powers of enforcement vis-à-vis the public. Unfortunately, in July 2011 the Federal Circuit in In re Lovin [2] (opinion authored by Judge Dyk) allowed the USPTO to avoid obligations that the USPTO owes the public under the APA, while giving the USPTO judicial deference on issues where the APA grants none. A petition for rehearing of the Lovin case would give the en banc Federal Circuit the opportunity to ”right this wrong,” and to give the public the remedy that Congress intended, and to reinforce that the Administrative Procedure Act gives agencies both rights and obligations.