Posts in Patents

Today, blockchain projects are proceeding in nearly every major industry and occur in more than 140 countries. According to blockchain IP landscape research by Perception Partners, over the past three years, the compound annual growth rate (CAGR) of patent families publishing in the United States, Europe, Patent Cooperation Treaty (PCT), China, Japan and Korea is about 23%. The space has more than 13,000 global competitors of every size with nearly 23,000 inventors or authors disclosing or researching blockchain innovations. Much has been written about Bitcoin and blockchain technology, including a prior article in which we provided an overview on “The Bitcoin Network, Blockchain Technology and Altcoin Futures.”  To keep pace with the evolving nature of blockchain intellectual property and technology, below we provide some sample use cases of how blockchain innovations are already being leveraged in commerce and likely to be exploited in the near future.

The “Support Technology and Research for Our Nation’s Growth and Economic Resilience Patents Act of 2019” or the “STRONGER Patents Act of 2019,” currently under consideration as Senate Bill 2082 and House Resolution 3666, poses questions about the types of decisions that would operate to bar inter partes review (IPR) and post-grant review (PGR) of patent claims. The STRONGER Patents Act is an effort to cure some of the perceived infirmities in the U.S. patent system. While prior versions—introduced in 2015 and 2017—were more wide-ranging, the STRONGER Patents Act of 2019 primarily focuses on the availability of injunctive relief and the susceptibility of patents to IPR and PGR. Among other changes, the bill would effectively overrule the Supreme Court’s eBay v. MercExchange decision, require inter partes and post-grant review petitioners to prove invalidity by clear and convincing evidence, permit only one such review of any given patent claim, and purport to finally end the occasional practice of diverting some the USPTO fees from its operations. While much can (and has) been written about the merits of such reforms, the present comment specifically considers the proposed “Priority of Federal Court Validity Determinations.”

This week in Washington D.C., the Congressional hearings schedule is empty as both the U.S. Senate and the U.S. House of Representatives enter work periods. However, Monday kicks off with a pair of think tank events on global technology issues at the Center for Strategic and International Studies and the Atlantic Council. The Brookings Institution hosts a pair of tech-related events this week—one focused on threats to democracy through digital capitalism and the other exploring how tech policy has altered the U.S.-China relationship. Other events include a look at securing supply chains for information and communication technology at the Carnegie Endowment for International Peace and a look at the future of the Marine Corps at The Heritage Foundation.

The authorization of consumption of Cannabis derivative products in several countries has led to the rapid development of a robust industry around such products. However, Brazilian legislation is still conservative concerning the sale, production, and use of cannabis derivative products, all of which are currently prevented by Brazilian law and defined as both civil and criminal offenses. But despite Brazil’s restrictive position concerning the permission of production and selling of cannabis-related products, the country is now taking baby steps towards the legalization of some aspects of the use and sale of cannabis products, putting the country at the center of discussions around this topic.

Recently, the United States Court of Appeals for the Federal Circuit (“the Federal Circuit”) issued its opinion in Solutran, Inc. v. Elavon, Inc., 2019-1345, 2019-1460 (Fed. Cir., July 30, 2019) in which the Court held claims 1-5 of Solutran’s U.S. Patent No. 8,311,945 invalid under 35 U.S.C. § 101 for failing to recite patent eligible subject matter. In reversing the District Court, the Federal Circuit found that the claims of the patent recited an abstract idea (electronically processing paper checks) and that the claims failed to transform that abstract idea into patent-eligible subject matter. More importantly, the Federal Circuit dismissed Solutran’s argument that the claims were patent eligible simply because they were novel and non-obvious, noting that: “We have previously explained that merely reciting an abstract idea by itself in a claim—even if the idea is novel and non-obvious—is not enough to save it from ineligibility.” The Solutran decision is not the first time the Federal Circuit has held that novelty/non-obviousness does not bear on the question of patent eligibility.

In order to obtain exclusive rights on an invention, you must file for and obtain a patent. Many inventors will initially opt to file a provisional patent application to initiate the application process, which is a perfectly reasonable decision to make, and will result in a “patent pending” that can even result in a licensing deal. Ultimately, if a patent is desired, a nonprovisional patent application must be filed, and it is this nonprovisional patent application that will mature into an issued patent. U.S. patent laws require that the patent applicant particularly point out and distinctly claim the subject matter which the inventor regards as his or her invention. Any patent, or patent application, contains a variety of different sections that contain different information. Generally speaking, a patent is divided into a specification, drawings and patent claims. Only the patent claims define the exclusive right granted to the patent applicant; the rest of the patent is there to facilitate understanding of the claimed invention. Therefore, patent claims are in many respects the most important part of the patent application because it is the claims that define the invention for which the Patent Office has granted protection.

This week in Other Barks & Bites: the Federal Circuit issued a precedential decision reversing the PTAB regarding proper primary reference and CBM review findings; USPTO Director Iancu told IPO Annual Meeting attendees that subject matter eligibility guidelines are working; an EPO-EUIPO report shows IP-intensive industries contribute nearly half of EU GDP; the producers of the Broadway musical Hamilton have filed a motion to dismiss copyright claims filed in connection with a museum exhibit; eBay CEO Devin Wenig stepped down; the Ninth Circuit heard oral arguments in the en banc rehearing of the “Stairway to Heaven” copyright case; the U.S. Copyright Office is seeking public comments regarding the blanket licensing structure under the Music Modernization Act; and Sandoz has moved forward with a PTAB challenge on patent claims covering AbbVie’s Imbruvica.

On September 12, a jury verdict form  entered in an Eastern District of Texas patent infringement case found in favor of defendant Jack Henry & Associates on its defenses of noninfringement and invalidity regarding patent claims asserted by plaintiff PPS Data. According to information provided to IPWatchdog, the verdict marks the first time that a jury has invalidated a patent under Section 101 since the February 2018 decision of the U.S. Court of Appeals for the Federal Circuit in Berkheimer v. HP Inc., where the appellate court held that factual questions underlie the Section 101 inquiry.

Something has happened at the United States Court of Appeals for the Federal Circuit over the past six months. After inching forward in a positive direction on patent eligibility, the entire court, including those judges who had been on the pro-patent eligibility wing of the court, have fallen, slipped, or just given up. The precisely correct characterization remains elusive given the traditional, characteristic and appropriate secrecy that surrounds judicial tribunals. As constitutional officers charged with independently deciding cases, judges take few speaking engagements. Even when they do, they generally speak off the record, and never speak about specific issues or cases that may at some point come before them. In this industry, that means little discussion is had between the bench and bar relating to matters of patent eligibility outside the record, which is itself unfortunate. If the judges of the Federal Circuit would sit through a conference exploring patent eligibility as it applies to the software and biotechnology industries, they would learn much about the uncertainty their decisions are causing. Still, something undeniably has changed.

The Federal Circuit issued a precedential decision on Wednesday reversing-in-part, vacating and remanding a decision of the Patent Trial and Appeal Board that had found certain claims of U.S. Patent No. 8,908,842 (the ’842 patent) subject to covered business method review, patent ineligible and unpatentable for obviousness. SIPCO LLC v. Emerson Electric (Fed. Cir., Sept. 25, 2019). Judge Reyna dissented in part. In a footnote, the Court distinguished its reasoning from its finding in the garage door-opener case, Chamberlain Group, Inc. v. Techtronic Industries Co., in which the Court found claims reciting wireless communication of status information about a movable barrier operator to be directed to an abstract idea. “Unlike in Chamberlain, SIPCO’s claimed invention does not simply use “well understood,” off-the-shelf wireless technology for its intended purpose of communicating information,” said the Court.

Patent application drafters are front-line participants to some of the most amazing innovations in the world today. A recent WIPO paper on Artificial Intelligence (AI) outlines how we are filing for patents on knowledge automation at an increasing rate. Our current tools, however, do not reflect the innovations with which we are so familiar. Historically—and to this day—the process of drafting a patent application has been a manual task. It is a task that takes, on average, 40 hours of a highly-skilled patent application drafter’s time. Anyone who has drafted any volume of patent applications for a client knows that the drafting process typically involves the use of boilerplate language and substantial copy and paste operations. While performing these repetitive tasks, we have all thought: “there must be a better way.” While we find ourselves surprised by the lack of tools to help with patent application drafting, we recognize the challenges that must be overcome. Different attorneys, firms, and clients often have different styles and preferences when it comes to the way patent applications are drafted. Thus, any automation tools would necessarily need to handle these different styles and preferences. But these challenges notwithstanding, the days of drafting a patent application completely manually by a single patent drafter are coming to an end.

The Supreme Court has requested that Apple and Cisco file responses to Straight Path IP Group, LLC’s (SPIP’s) petition for certiorari in Straight Path IP Group, LLC v. Apple Inc., et al. The petition presents the following question: “Whether Rule 36(e) of the Federal Circuit’s Rules of Procedure violates the Fifth Amendment by authorizing panels of the Federal Circuit to affirm, with no explanation whatever, a District Court judgment resolving only issues of law.” SPIP filed its petition on August 23 and Apple and Cisco filed waivers of their right to respond on September 4 and 5, respectively. But on September 18, the Court requested that both companies file their responses by October 18.

It is time to recognize the elephant in the room. The Patent Trial and Appeal Board (PTAB) is broken. And, if we want to be perfectly fair and reasonable in our assessment of the reasons that the PTAB is failing, the blame must trace all the way back to Congress. The creation of three new ways to invalidate patent rights was at best ill-conceived. The manner in which it was done clearly put the finger of infringers on the scale of justice. The creation of an open-ended second window for patents to endlessly be challenged without title ever quieting and ownership ever settling is making a mockery of patent ownership.

The present U.S. eligibility jurisprudence, and especially that of the Federal Circuit, not only creates serious issues of U.S. domestic law but also arguably places the U.S. in violation of its obligations under the TRIPS treaty with respect to inventions at both ends of the subject-matter spectrum. Acts of Congress, including Section 101, where fairly possible, ought to be construed so as not to conflict with international law or with an international agreement with the United States, particularly where, as with TRIPS, the United States was the moving spirit behind the treaty. See Murray v. The Schooner Charming Betsy, 6 U.S. (2 Cranch) 64, 118 (1804). Although there may have been room for doubt prior to the en banc refusal in Athena and the Australian decision in Ariosa, it is submitted following Judge Moore’s dissent that the situation has become a virtual certainty.

Standards-declared patents have been challenged in ex parte and post-grant review for years as part of enforcement efforts and other strategies, though the volume of patents declared essential and their largely unlitigated status has limited the appeal of post-grant challenges against them.  One such standard, High-Efficiency Video Coding (HEVC), promises to be the successor to the current H.264 standard used by most streaming visual media.  As all parties seek to clear risk and license as they implement, developing patent pools have been utilizing new strategies for licensing standard-declared patents. Recently, Unified Patents launched an HEVC zone aimed at encouraging adoption and shedding light on the standard-essential patent (SEP) landscape, and has conducted damages studies, landscape models, and analysis of the patent landscape around the HEVC standard. As part of those efforts, Unified has been challenging patents related to the standard. To date, only a handful of litigations have been filed related to HEVC patents.