Posts in Litigation

On November 4, the U.S. Court of Appeals for the Federal Circuit (CAFC) reversed a decision by the U.S. Patent and Trademark Office’s Patent Trial and Appeal Board (PTAB) that University of Strathclyde’s patent claims for a method for photoinactivating antibiotic-resistant bacteria without using a photosensitizing agent were unpatentable. The PTAB held claims one, two, three, and four of U.S. Patent No. 9,839,706 (‘706 patent) were obvious based on the prior art. The court held the PTAB’s findings were not based on substantial evidence.

Is patent litigation out of control? Has patent litigation ever been out of control? The answers to these questions largely depend upon your point of view, and as with most complex topics, the truth is nuanced. What is not nuanced are the numbers reported in the annual reports from the  Administrative Office of the United States Courts, which shows that the number of patent cases that reach trial are extremely few. In fact, the number of cases that make it to the final pre-trial conference represents a small subset of the number of cases that are filed. I initially started this research in 1997, while working on my Master’s thesis, which dealt with patent litigation and the use of alternative dispute resolution. The real growth in patent litigation over the last 40 years has taken place before trial. Between 1980 and 2020, the number of patent cases reaching trial ranged between a low of 63 (in the COVID-19 affect FY 2020) but was otherwise at a low o 64 (in FY 2019) and a high of 164 (in FY 2016). All are a remarkably low number of cases that proceed to trial given the number of patent lawsuits commenced.

It was another banner week in district court complaints, led primarily by a deluge of new IP Edge complaints—49 in all, by my count—including newer subsidiaries (like Wiesblatt Licensing or Hickory IP) and old mainstays like Moxchange and Tunnel IP (over a dozen entities in total). At this point in 2021, IP Edge has filed at least 519 known suits via non-practicing entity (NPE) vehicles (more by various counts); it is by far the highest aggregate filer of all time, and of this year. To date, there have been 4,001 patent complaints filed (per Unified’s portal, based on publicly available PACER docket data); IP Edge thus has again filed upwards of 10% (so far, 13+%) of all U.S. patent litigation in 2021, up from last year. It also, for the first time, went to trial on one of its many patent assertions, though overwhelmingly vast majority of them remain file-and-settle affairs.

On November 2, Senator Thom Tillis (R-NC) sent a pair of letters regarding issues in district court patent litigation—one addressed to Drew Hirshfeld, performing the functions and duties of the Director of the U.S. Patent and Trademark Office (USPTO), and another letter co-written with Senator Patrick Leahy (D-VT) addressed to Chief Justice John Roberts of the U.S. Supreme Court. While never mentioned by name, U.S. District Judge Alan D. Albright is unmistakably the subject of both letters, which expressed serious concerns about “unrealistic trial dates” and “open solicit[ation]” of patent cases from a single judge in the Waco Division of the Western District of Texas.

President Joe Biden today announced that Judge Leonard Stark of the United States District Court for the District of Delaware is his latest nominee for the U.S. Court of Appeals for the Federal Circuit (CAFC). Stark will replace CAFC Judge Kathleen O’Malley, who announced on July 27 this year that she will retire, leaving a vacancy on the court as of March 11, 2022.

While many patent litigators have no plans to litigate in bankruptcy court, it is a possibility if the infringer of a client’s patent files for bankruptcy. The United States Bankruptcy Court for the Eastern District of Wisconsin recently conducted a Markman hearing. How did that happen?  After being sued for patent infringement in district court, the alleged infringer sought refuge in the bankruptcy court, staying the district court litigation. The plaintiff then filed a claim in the defendant’s bankruptcy case, which ultimately triggered the bankruptcy court’s jurisdiction. While rare, other bankruptcy courts have conducted claim construction proceedings. As discussed herein, the bankruptcy court ultimately granted a joint request for vacatur, prompting us to revisit the doctrine of vacatur.

Following a motion filed in mid-October with the U.S. Court of Appeals for the Federal Circuit (CAFC) accusing the United States Patent and Trademark Office (USPTO) and its management of facilitating the appearance of bias at the Trademark Trial and Appeal Board (TTAB) in favor of Apple, Inc., Apple has now filed its opposition to that motion. Apple contends there is no precedent for allowing the motion, as it requests to supplement the record with documents that were not part of the trial record; that the TTAB is “an executive adjudicatory body” within the USPTO, which is “an executive agency within the Department of Commerce, and the TTAB’s administrative law judges are not subject to the recusal requirements set out in 28 U.S.C. § 455”; and that the documents Charles Bertini is asking to submit “reflect merely routine and fleeting professional contacts” that “fall far below the threshold of the personal contacts necessary to support disqualification on the basis of bias or prejudice.”

In response to intense lobbying for patent litigation reform, Congress was convinced that a substantial amount of district court patent litigation involved “poor quality” patents that were clearly invalid. Images of extortionist patent trolls were widely portrayed as a primary threat to U.S. innovation. The high cost of patent litigation, years to reach a judicial resolution and reliance on lay juries to determine highly technical issues were cited as evidence of a broken system. In response, Congress passed the Leahy-Smith America Invents Act (AIA) in 2011…. The current IPR system as implemented has caused severe damage to an important segment of our innovation community. Congress instructed the USPTO Director, in 35 USC§ 316(b), to “consider the effect of any such regulation on the economy, the integrity of the patent system, the efficient administration of the Office, and the ability of the Office to timely complete proceedings instituted under this chapter.” It is time for the Director to reevaluate the effect of IPRs.

On October 27, the United States Court of Appeals for the Federal Circuit (CAFC) affirmed the Trademark Trial and Appeal Board’s (TTAB) cancellation of Brooklyn Brew Shop, LLC’s (BBS) standard character mark and dismissed in part, affirmed in part and remanded the TTAB’s decision regarding the opposition of BBS’s mark. For over 30 years, The Brooklyn Brewery Corporation (Brewery) has used the marks BROOKLYN and BROOKLYN BREWERY in connection with the advertising, promotion, and sale of Brewery’s beer and beer-related merchandise. In 2006, Brewery registered BROOKLYN BREWERY as a federal trademark for beer in class 32.

It was a (relatively) light Patent Trial and Appeals Board (PTAB) and district court week, with 26 PTAB (two post grant reviews and 24 inter partes reviews) and 48 new district court complaints, with the number of dismissals or closed cases in district court again reaching nearly 100 for the third week in a row—I’m unsure exactly, though I suspect it has something to do with a fair number of cases being voluntarily dismissed and refiled in other jurisdictions following renewed vigor in venue analysis after the Federal Circuit’s recent round of mandamuses of Judge Albright’s cases (he’s up to 17 mandamuses on the issue of venue, mostly over the past calendar year by my count, which as far as I know is a single-judge record).

The Fifth Amendment of the U.S. Constitution guarantees, inter alia, that no person shall be deprived of property (including intellectual property), without due process of law. For instance, it is settled law that a federal statute may be so arbitrary and capricious as to violate due process. Similarly, it is settled that an administrative agency, e.g., the U.S. Patent and Trademark Office (USPTO), cannot escape the due process of law requirement when processing patent applications. In theory (less in reality), due process of the law extends to judicial as well as political branches of government, and judgments that violate constitutional limitations and guarantees are void or voidable.

5G—the next generation of telecommunications standards provided by the Third Generation Partnership Project (3GPP)—began implementation in 2019. It boasts significant technical benefits over prior generations, including higher speeds, greater bandwidth, lower latency, and larger coverage areas. Unlike previous 3GPP standards, 5G is not limited to cellular phones. Rather, 5G will support a plethora of technologies ranging from Enhanced Mobile Broadband to Massive Internet of Things. Accordingly, 5G will support a tremendous amount of economic activity: by 2026, 5G will have 3.5 billion subscribers and will account for 84% of mobile subscriptions in the United States. By 2035, 5G is expected to underly $13.1 trillion in global economic activity, accounting for 0.2% of the 2.7% projected annual global GDP growth.

In its latest rebuke of Judge Alan Albright’s approach to motions to transfer cases out of his court, the United States Court of Appeals for the Federal Circuit (CAFC) on October 21 granted DISH Network’s petition for a writ of mandamus challenging the denial of its motion to transfer a case filed by Broadband iTV (BBiTV) from the United States District Court for the Western District of Texas to the United States District Court for the District of Colorado.

In mid-October, a pair of lawsuits were filed in the Eastern District of Virginia by different groups of professional models seeking damages and injunctive relief under the Lanham Act from adult entertainment clubs for the unauthorized use of the models’ images in promotional materials. The filings come at about the same time that the U.S. Supreme Court is considering a petition for writ of certiorari from the U.S. Court of Appeals for the Second Circuit which asks the nation’s highest court whether the Second Circuit was wrong to create a public prominence requirement that prevents lesser known models from being able to assert their rights to their own likeness.

On October 5, the Senate Judiciary Committee considered the nomination of Judge Lucy Koh, currently of the U.S. Federal District for the Northern District of California, to an appointment by President Biden to the United States Court of Appeals for the Ninth Circuit. After that hearing, several Senators submitted written questions, which Judge Koh responded to last week. There is no indication that Judge Koh’s nomination to the Ninth Circuit is in jeopardy, but it is noteworthy, and at least somewhat unusual, numerous Senators asked Judge Koh virtually the same questions regarding her decision in FTC v. Qualcomm. This level of overlapping interest by multiple members of the Senate Judiciary Committee, which IPWatchdog.com has learned was not coordinated and developed organically, is normally reserved for nominees to the Supreme Court, and even then, typically reserved to social or constitutional issues. So, even though it is believed Judge Koh can and will easily receive a favorable confirmation vote, the questions relating to the intersection of antitrust and patent law demonstrate a keen awareness and interest in these issues on the Senate Judiciary Committee.