Posts in IP News

Judge William C. Bryson of the United States Federal District Court for the Eastern District of Texas found that Allergan’s RESTASIS® patents were infringed by Teva Pharmaceuticals USA, but that Teva had demonstrated invalidity of those patents by clear and convincing evidence… In a separate Order dealing with the issue of whether the Saint Regis Mohawk Tribe should be joined as co-plaintiff, Judge Bryson acknowledged that “the sovereign immunity issue is not presented in this case,” but nevertheless went to great lengths in dicta to express his opinion on the matter anyway.

The argument that patents are private rights is supported by over two centuries of jurisprudence. Patent rights derive from Article I, section 8, clause 8 of the U.S. Constitution, which empowers Congress to promote progress by creating laws involving patents and copyrights. The patent bargain exchanges disclosure of new and useful inventions for a limited term exclusive right. The public benefits from the patent bargain in two ways. First, the disclosure enables others to build on the invention. Second, after a twenty year period, the public receives the benefits of the invention for free as the rights flow to the public domain. The patent bargain stimulates incentives to invent, to invest in innovation and to take ex ante risks.

As President Trump embarks on the renegotiation of NAFTA, it is critical that we seize the opportunity to make it the gold standard in intellectual property rights protections… The stakes are tremendous and cannot be ignored.  In total, it is estimated that intellectual-property theft costs the United States approximately $600 billion per year.  A recent New York Times article notes that this is the “greatest transfer of wealth in history”.

Branded apparel companies face many challenges in protecting their IP assets, including the unavailability of copyright protection for fashion designs, the length of time necessary to secure a design patent, the challenge of securing secondary meaning required for a trade dress claim before the market is flooded with knock-offs, and the geographic and practical impediments to pursuing counterfeiters, who are often foreign-based and/or judgment proof.  Perhaps mindful of the limited statutory protections for IP assets and the significant damages being incurred at the hands of infringers, various courts, particularly in the Second and Ninth Circuits, have in recent years taken steps to enhance the alternatives available to apparel companies confronted by the scourge of knockoffs.  Specifically, such court decisions have (1) expanded the scope of potential contributorily liable actors, and (2) broadened the means of freezing and attaching assets of foreign counterfeiters.

On Monday, October 9th, San Diego, CA-based fabless semiconductor developer Qualcomm Inc. (NASDAQ:QCOM) announced that it had entered into a licensing agreement with Istanbul, Turkey-based General Mobile, a regional smartphone brand and a partner of the Android One smartphone project developed by Google. The royalty-bearing patent license grants General Mobile the right to develop, manufacture and sell 3G and 4G complete devices which incorporate technologies that are covered by patents in Qualcomm’s portfolio.

Does your CEO, CFO, CTO and General Counsel have the most relevant information regarding the innovation in process to make informed choices about what to pursue? Do your scientists and engineers know enough about what can be protected as proprietary to identify when they have created something of value? Do your middle managers understand enough about the science, engineering and law to ensure they don’t weed out the next billion-dollar idea as something not worth pursuing? Does your corporation have policies in place to determine the best path to proprietary protection once an innovation of consequence has been realized? Join me for a free webinar on Thursday, October 19, 2017 at 12pm ET to discuss these critical questions and decision-points on the path from idea to intangible asset to tangible profit.

On Thursday, October 12th, a pair of letters addressed to the bipartisan leadership of the Senate Judiciary Committee were delivered in an attempt to inform Senators on that committee of various issues in play regarding the recent patent deal between multinational pharmaceutical firm Allergan and the sovereign St. Regis Mohawk Tribe. The two groups sending the letters represent stakeholders in the U.S. patent system coming from very different backgrounds who realize that there are fundamental flaws in the system created by inter partes review (IPR) proceedings which are carried out at the Patent Trial and Appeal Board (PTAB).

There is growing speculation among Capitol Hill watchers that the Judiciary Committee may soon be ready to hold a nomination hearing to vet Iancu’s credentials to serve as USPTO Director, perhaps as soon as this month. Although there’s a strong chance that the hearing would focus on recent developments like the Allergan-St. Regis Mohawk Tribe patent arbitrage deal, the hearing will be the patent world’s first true glimpse into Iancu’s vision for the role of the USPTO in promoting America’s innovation economy… Some additional details have begun to emerge thanks to a public response to a questionnaire submitted by Iancu to the Senate Judiciary Committee. This filing and attached documents help to flesh out many of the details surrounding the patent attorney’s experience as well as his viewpoints on certain trends affecting patent system stakeholders as outlined in articles and speeches given by this individual.

Idenix Pharmaceuticals LLC v. Gilead Pharmaceuticals, Inc., C.A. No. 14-846-LPS (Delaware Dist. Court, Sept 22, 2017) (“Idenix v. Gilead”), is a good example of the exercise of such discretion by a district court.  Rich in facts, the case is suitable for the application of the flexible contextual standards the Supreme Court showed preference for in Halo.  Also, the case involves balancing the public good of promoting innovation by deterring willful infringement against the public good of facilitating imitation and refinement through imitation.  It is apparent from the Court’s reasoning that it was being very mindful that without the particular “refinement through imitation,” involved in the case, a life-saving cure for hepatitis C would not have been discovered.  Enhanced damages were not awarded.

Mr. Matal opened his discussion stating his belief that independent inventors are the lifeblood of American innovation. He said that a patent is a property right and that whether an inventor actually manufactures the invention or seeks to license it, the rights provided by the patent should be the same. Having said this, he still believes that the PTAB should be able to invalidate a patent, but he did say that it is definitely time to look at the PTAB closely and see what can be done to make it operate more fairly. While he reiterated several times he is only acting and a permanent replacement has been nominated, he said that he would be surprised if this didn’t happen.

On Friday, October 6th, Chicago, IL-based intellectual property owner Ironworks Patents LLC filed a patent infringement case against Cupertino, CA-based consumer tech giant Apple Inc. in the District of Delaware. Ironworks’ complaint alleges that Apple’s sale of various iPhone models infringe upon patents that Ironworks owns which cover programmable alert sounds and related technologies incorporated into Apple’s smartphones.

Although the patent prosecution process is adversarial in nature, patent practitioners must be keenly aware of their duty to maintain the integrity of any subsequently issued patent by supplying the patent examiner with all prior art that is believed to be relevant and also avoiding any misrepresentations of the prior art.  Patent litigators have long been aware of the potential pitfall of having a patent invalidated based on inequitable conduct due to activities of a patent prosecutor carried out months or years prior to the litigation proceedings.  In light of a recent decision by the Federal Circuit in Regeneron Pharmaceuticals v. Merus, however, it now appears that inequitable conduct by a patent prosecutor may be inferred due to activities of a patent litigator carried out month or years after patent prosecution has concluded.

The patent deal with the St. Regis tribe doesn’t shield the patents from validity challenges coming from a Hatch-Waxman trial recently concluded in Texas federal court. “To be clear, if the District Court ruling is adverse to Allergan’s patent position, and there is an FDA approval of a generic version of RESTASIS®, that product could enter the market many years in advance of the listed patent expiry dates,” Allergan’s note reads. The drugmaker further argues that the IPR process in force at the PTAB undermines the 33-year-old Hatch-Waxman statutory regime regarding validity challenges to pharmaceutical patents, is subject to changes to validity proceedings implemented within the executive branch which are not impartial, and creates an unfair burden on innovators by opening patents to challenge proceedings which are often inconsistent before both the PTAB and the Court of Appeals for the Federal Circuit, the court to which PTAB decisions can be appealed.

After a panel of the Federal Circuit affirmed the Board’s decision, in Aqua Products v. Matal, Aqua requested an en banc rehearing. The USPTO Director Joseph Matal joined the appeal on behalf of the USPTO. At issue was whether the Board could place the burden of proof for patentability of amended claims on the patent owner in an IPR, and the Board’s underlying interpretation of the relevant statutes, specifically § 316(d) governing claim amendments and 35 U.S.C. § 316(e) allocating the burden of proof in an IPR… With respect to the burden of proof, the burden of persuasion for patentability of amended claims in an IPR proceeding is placed on the petitioner, not the patent owner. However, considering Judge Reyna’s concurrence, patent owners might still have the burden of production; depending on future cases.

There appears to be a consistent pattern of public rights cases from Murray’s Lessee to Stern. Congress may establish a public right, separate from actions that affect the federal government, that involves an action related to protection of the public, such as health or welfare, and may establish an executive tribunal in which to adjudicate these rights. An Article I tribunal may adjudicate these public rights, primarily by advancing a fact-finding role, but within the constraints of consent, due process and review by an Article III court. On the other hand, private rights or rights involving matters between private parties that have been adjudicated in common law in Article III courts will continue to be resolved only in the federal courts. A right to a jury to hear facts in federal courts will be maintained in those disputes between private rights involving private parties.