Posts in Litigation

In the past 10 months, the issue of proving negative claim limitations has cropped up on appeals to the Federal Circuit. At least three panels of the Federal Circuit have addressed the issue, to one degree or another. Each panel has contributed, to some extent, to an understanding of the law. In dealing with the issue, each panel cited no precedent for doing so. Curiously, all three decisions were designated as nonprecedential. The negative claim limitations issue is one that is almost certain to recur. Perhaps the next time the issue comes up, the decision ought to be precedential, and therefore, binding.

Commissioner Christine Wilson of the U.S. Federal Trade Commission (FTC) addressed the IPWatchdog Patent Masters Symposium on Tuesday, September 10, emphasizing three main points in her keynote: that Judge Lucy Koh’s decision in FTC v. Qualcomm was flawed, that antitrust analyses should be more focused on dynamic, rather than static effects, and that, despite the latter point, antitrust authorities routinely try and fail to integrate dynamic effects into antitrust law. She was clear up front that her views did not necessarily match those of her fellow commissioners. First, Wilson reiterated the ideas expressed in her May 28 op-ed for the Wall Street Journal, which she summarized by saying that U.S. District Court for the Northern District of California Judge Lucy Koh’s opinion in the FTC v. Qualcomm case “creates bad law and bad policy.” Wilson explained that Koh in her lengthy analysis took the opportunity to “radically expand a company’s legal obligation to help its competitors” by reviving a “discredited” 1985 Supreme Court case, Aspen Skiing Co. v. Aspen Highlands Skiing Corp. “My opposition to the court’s opinion does not stem from any desire to help or protect Qualcomm,” Wilson said. “I am focused on applying and preserving sound antitrust principles and this decision scares me.”

To seek relief in Federal Court, a plaintiff must demonstrate a personal, legally protectable interest in the outcome of the dispute for which relief is being sought, i.e., must demonstrate standing. The legally protectable interest may be under threat because of a government conduct. In patent disputes, the plaintiff may be an inter partes review (IPR) petitioner who has challenged a patent and is dissatisfied with the final written decision of the Patent Trial and Appeal Board (PTAB) regarding upholding of patent claims by the PTAB. Here, the decision upholding the claims would be the government conduct complained of. The dissatisfied petitioner may appeal to the Federal Circuit and, to prove standing, allege that it is injured because the decision upholding the claims reduces its ability to compete with the patent owner. If the petitioner has no current interest in practicing the claims, would it have standing? No, it would not, according to the Federal Circuit in Avx Corporation v. Presidio Components, Inc. 2018-1106 (Fed. Cir. May 13, 2019) (“Avx Corp.”), where this scenario played out. The court explained that although “competitor standing” can be found to challenge government actions in certain situations, this was not one of them, as the petitioner was unable to demonstrate any present or nonspeculative interest in engaging in conduct even arguably covered by the claims at issue. Avx Corp. at 9.

In his luncheon keynote address to attendees of IPWatchdog’s Patent Master’s Symposium: “Standard Essential Patents: Striking a Balance Between Competition and Innovation” on Tuesday, former Federal Circuit Chief Judge Randall Rader drove home a point made by multiple speakers during the event that the concept of “patent hold-up”—in which innovator companies use SEPs to hold up implementer companies from getting products to market via anti-competitive practices—is “one of the largest misnomers in our discipline.” Earlier in the day, David Kappos, former Director of the USPTO, explained that— although he signed off on the Joint Policy Statement, that it was thoughtfully and heavily negotiated and edited, and that he felt at the time that it was a good document and a compromised agreement—he stepped back after Delrahim’s announcement last year and has now reconsidered his view. “I was defending the IP system given everything we knew at the time,” Kappos said. “I didn’t think the guidelines were anti-innovation; I thought they were balanced. But in stepping back, I realized—between 2013 and 2019 we’ve learned a lot. Multiple empirical studies have shown us that the phenomena on which we based the guidelines— hold-up and royalty stacking — aren’t occurring. There is no evidence of our predictions.”

On September 5,  the U.S. Court of Appeals for the Federal Circuit (CAFC) held that state sovereignty principles asserted by the Board of Regents of the University of Texas System (UT) do not give UT the right to bring suit in an improper venue. The appeal clarifies once again that sovereign immunity may be used only as a shield, not a sword. UT argued that Boston Scientific Corporation’s request that the case be transferred to the District of Delaware should be reversed because venue was proper in the Western District of Texas since a state has the right to sue a nonresident in a forum of its choosing where personal jurisdiction is satisfied. It argued that the federal patent venue statute cannot override this sovereign right. UT also argued that the District of Delaware lacks jurisdiction because UT never consented to suit in Delaware, nor did it waive its sovereignty in Delaware or abrogate its sovereignty by statute. The CAFC disagreed with the above, holding that state sovereignty does not allow states to bring patent infringement suits in an improper venue, as is the case where BSC does not have a place of business in Texas. It also held in Regents of University of Cal. V. Eli Lilly & Co. that sovereign immunity does not apply where the state acts only as the plaintiff, and therefore the right of UT to choose the forum does not apply because the Eleventh Amendment only applies to suits against a state, not by a state.

Recently, the Federal Circuit reversed, vacated and remanded a decision of the U.S. District Court for the District of Colorado that granted Mushkin, Inc.’s (“Mushkin’s”) motion to dismiss Anza Tech.’s (“Anza”) complaint seeking damages for alleged patent infringement occurring between March 2011 and April 2012 because the claim for damages was time-barred by the six-year statute of limitations in the Patent Act, 35 U.S.C. § 286. See Anza Tech., Inc. v. Mushkin, Inc., No. 2019-1045, 2019 U.S. App. LEXIS 24432 (Fed. Cir. Aug. 16, 2019) (Before Prost, Chief Judge, Newman and Bryson, Circuit Judges) (Opinion for the Court, Bryson, Circuit Judge). In its determination of whether newly alleged claims, based on separate patents, relate back to the date of the original complaint, the Federal Circuit considered: (1) the overlap of parties, (2) the overlap in the accused products, (3) the underlying science and technology, (4) time periods, and (5) any additional factors that might suggest a commonality or lack of commonality between the two sets of claims.

If you’re reading this blog, then you likely are an avid follower of the Section 101 saga. The most recent episode in this saga, Chamberlain v. Techtronic at the Federal Circuit, is about so much more than a garage door operator being an abstract idea. It’s about the fact that we still have no clue what’s supposed to happen in the 2A and 2B steps of the judicially-created Alice/Mayo test. The Chamberlain panel applied the Alice/Mayo test completely backwards compared to what the Berkheimer panel said. First, the question of improvement was assessed in Chamberlain’s “Step One” (or 2A). Not only that, the panel then immediately went on to find that “(t)he specification admits that the act of transmitting data wirelessly is ‘well understood in the art,’ and no other changes to the generically claimed movable barrier operator are recited in the asserted claims or described in the specification.” 

Courts construe, administer, and apply the Federal Rules of Civil Procedure so as “to secure the just, speedy and inexpensive determination of every action and proceeding.” Fed. R. Civ. P. 1. Large patent portfolios have contributed to the increase in numbers of unwieldy cases that assert many patents and claims. A court presiding over such a case usually makes every…

This week in Other Barks & Bites: the Chinese government announces stricter punitive measures in its IP system; the Federal Circuit says state sovereignty principles do not allow the University of Texas to bring suit in an otherwise improper venue; Congressional leadership asks Google to expand copyright protections under its Content ID tool; Google and Facebook to face antitrust probes from state AGs; George Mason University to create an Innovation Law Clinic; Ariana Grande files a copyright and trademark infringement suit against Forever 21; the Hudson Institute publishes a report on China’s 5G developments; and South Korea’s government has reportedly been collecting copyright payments for use of North Korean TV broadcasts.

The Court of Justice of the European Union (CJEU) has ruled that an EU trade mark (EUTM) proprietor may bring an infringement action in an EU Member State where advertising or offers for sale are directed or located, in a case concerning alleged infringement of an EUTM in the United Kingdom by a Spanish defendant. The judgment in Case C172/18 AMS Neve Ltd, Barnett Waddingham Trustees, Mark Crabtree v Heritage Audio SL, Pedro Rodríguez Arribas addresses questions concerning jurisdiction, in particular in cases involving Internet sales. This litigation concerned infringement proceedings brought regarding an EUTM for “1073” in the UK Intellectual Property and Enterprise Court.

In August, the United States Attorney’s Office (USAO) for the Northern District of California charged a pioneer of self-driving car technology, Anthony Levandowski, with 33 counts of theft and attempted theft of trade secrets from Google under 18 U.S.C. § 1832 of the Economic Espionage Act (EEA). According to the indictment, Levandowski downloaded more than 14,000 files containing critical information about Google’s autonomous-vehicle research before leaving the company in 2016. The indictment alleged that Levandowski then made an unauthorized transfer of the files to his personal laptop. Some of the files that Levandowski allegedly took from Google included private schematics for proprietary circuit boards and designs for light sensor technology, known as Lidar, which are used in self-driving cars. Levandowski joined Uber in 2016 after leaving Google when Uber bought his new self-driving trucking start-up, “Otto.” Levandowski has repeatedly asserted that he never disclosed the download, nor made use of the information while he was at Uber.

An inter partes review (IPR) petitioner appeals the final written decision of the Patent Trial and Appeal Board (PTAB) as to claims upheld but is found to have no standing, as there is no present indication that the challenger would face a patent infringement suit in future. Under these circumstances, would the IPR statutory estoppel provision, 35 U.S.C. § 315(e), prevent the petitioner from asserting the challenges it brought against the upheld claims if the patent owner were to assert those claims against the petitioner in future? Note that under these circumstances, if estopped, the petitioner would have sought judicial review, but the merits of the challenges would not have been reviewed by an Article III court. This was one of the questions before the Federal Circuit in Avx Corporation v. Presidio Components, Inc. 2018-1106 (Fed. Cir. May 13, 2019) (“Avx Corp.”). Although the court declined to answer the question, as there were no adversarial presentations on this question, it clarified that the operation of estoppel was not a foregone conclusion under these facts, which, the court indicated, may fall under one of the exceptions to issue preclusion.

In the most recent development in a case between energy drink brand Monster Energy Company and maker of automotive tools Integrated Supply Network, LLC (ISN), the U.S. District Court for the Central District of California on July 2 denied Monster’s request for a permanent injunction against ISN. Monster appealed on July 3 to the U.S. Court of Appeals for the Ninth Circuit and ISN cross-appealed on July 12. The district court found that Monster did not offer evidence demonstrating that ISN’s infringement had actually caused a loss of control over its business reputation leading to irreparable harm and loss of prospective customers. Additionally, the court reasoned that evidence regarding consumer confusion does not necessarily demonstrate irreparable harm. Even where ISN had not ceased infringing activity, Monster still had not proven irreparable harm as required to justify a permanent injunction, said the court.

A little more than two years ago, I made the decision to go to law school. Many factors went into this decision but suffice it to say that my work with IPWatchdog and encouragement from both Gene and Renee Quinn played a major role in choosing this course. This spring, I was accepted into the University at Buffalo School of Law and, with the second week of classes about to begin, I find myself very busy with the job of cramming basic concepts in torts, contracts and civil procedure into my brain. Monday, August 26 was to be the first day of classes at UB Law, but the day’s courses were cancelled for a momentous occasion. That day, U.S. Supreme Court Justice Ruth Bader Ginsburg visited the campus to give a talk at UB’s Center for the Arts and receive a State University of New York (SUNY) honorary degree. The event came a mere three days after the Supreme Court announced that Justice Ginsburg had just finished a three-week course of radiation therapy to treat a tumor. The Supreme Court Justice, however, gave very little indication that she had just undergone major medical treatment, handling both her address and a one-hour lecture with UB Law students with great aplomb. The day’s events did not include any information on intellectual property but it did offer various insights on Justice Ginsburg’s career and the upcoming Supreme Court term.

A recent study by Patexia analyzing the win/loss record of 784 law firms representing patent owners in inter partes review (IPR) proceedings at the Patent Trial and Appeal Board (PTAB) found that Carmichael IP had the highest win percentage. The study counted all decisions rendered in the past five years for firms that handled a significant number of IPRs before the Board. Carmichael IP ranked #1 out of the 784 qualifying law firms in the Patexia survey and Carmichael himself ranked third out of 5,000 individual attorneys.