Posts Tagged: "intellectual property"

In March, Chrimar Systems, Inc. filed a petition for certiorari asking the U.S. Supreme Court to decide: 1) whether the Federal Circuit may apply a finality standard for patent cases that conflicts with the standard applied by the Supreme Court and all other circuit courts in non-patent cases, and 2) whether a final judgment of liability and damages that has been affirmed on appeal may be reversed based on the decision of an administrative agency. On April 23, the Court requested a response from ALE USA, Inc., which had waived its right to respond earlier that month. As a result, the deadline for amicus briefs was reset and one more amicus, Baxter International, submitted its brief in support of Chrimar on May 22, followed by ALE’s brief in opposition to the petition on May 26.

With 27 new Patent Trial and Appeal Board (PTAB) filings—25 inter partes reviews (IPRs), one post grant review (PGR) and one covered business method review (CBM), the first in months—this week’s numbers rested roughly within the new normal, with district court complaints flatlining at around 70 (i.e., 68 this week). That included five petitions on five patents owned by SAP brought by the Teradata corporation; on the District Court side, lots of small-potatoes NPE campaigns complemented a number of WSOU filings against their latest target, Dell EMC, as well as a few small company disputes, and one suit against the Her Majesty the Queen in Right of Canada.

Intangible assets today make up nearly 84% of enterprise value for companies listed on the S&P 500. This material growth in intellectual property as an asset on U.S. company balance sheets has placed increased demands on the office of General Counsel. Protecting intangible assets against computer theft and pursuing litigation against wrongdoers has become a major and timely concern, especially in the context of an increasingly virtual world due to the global pandemic. A recent brazen and sophisticated computer intrusion into the records of over 145 million Americans launched from computer hackers based in China led to criminal prosecutions under the Computer Fraud and Abuse Act (CFAA).

Joe Mullin, a policy analyst at the the Electronic Frontier Foundation (EFF), recently penned a misleading article about the Inventor Rights Act  (H.R. 5478). He says it will promote and protect patent trolls. To unravel what he really means, it is first necessary to understand early stage investment, and from there, to define what a “patent troll” truly is. Through organizations like EFF and their companion organization, Engine, Big Tech often writes scary stories about how patent trolls hide under bridges for no other reason than to utterly destroy innovation. Very scary stuff. Scary because this fantasy has misled the courts, Congress, and multiple administrations, convincing them to change the law in ways that destroyed America’s startup engine. Scary because early stage investment is fleeing to China at the expense of American startups. Scary because it has created perpetual Big Tech monopolies with no allegiance to the United States that are immune to American competition and taxes. These forces now control what we read and say, how we vote, and even what we believe to be true.

On May 12, the U.S. Court of Appeals for the Second Circuit issued a decision in Sohm v. Scholastic in which the appellate court reversed in part a decision handed out by the U.S. District Court for the Southern District of New York (SDNY) granting partial summary judgment to Sohm for Scholastic’s infringement of copyright to six photographs and dismissing other claims by Sohm. Among the issues decided by the Second Circuit on appeal was an issue of first impression on group registrations. The Second Circuit decision aligned with case law from the Ninth Circuit, which has held that an individual can sue for copyright infringement covering individual works within a group registration even if that individual isn’t named as an author in the group registration.

In the wake of COVID-19, government officials around the world face unprecedented decisions about when and to what extent they should reopen their respective societies before effective anti-viral medications or vaccines have been developed, necessary regulatory approvals obtained, and those solutions are manufactured for public use. Fundamentally, such decisions will require a delicate balance between protecting public health and facilitating economic growth, which, as we have all been reminded this year, are deeply intertwined.

The Federal Circuit recently found that a method for preparing an extracellular DNA fraction from a pregnant human female and using it for analyzing a genetic locus involved in a fetal chromosomal aberration was not directed to a natural phenomenon, and thus eligible for patenting. Illumina, Inc. v. Ariosa Diagnostics, Inc., No. 2019-1419 (Fed. Cir. March 17, 2020) (“Illumina v. Ariosa”). The decision includes a dissent. Appreciation of the reasoning of both the Majority and the Dissent is essential to understanding the current state of the debate on subject matter eligibility of processes involving natural phenomenon. The all-important question in such cases centers on how to determine whether such an invention is directed to a judicial exception. Stated differently, when does an invention that uses a natural phenomenon turn into a patent-eligible process rather than being directed merely to the natural phenomenon?

In a world of unlimited resources and intellectual property (IP) legal department budgets, all invention disclosures would lead to patent application filings. But this was not the world we lived in prior to the current COVID-19 pandemic, and the pandemic has only further constrained resources for many companies. Separating the wheat from the chaff has always been a prudent part of invention harvesting. Certain disclosures simply do not merit the filing of a new patent application. Other disclosures do merit a filing, and the question then becomes how robust of a filing to draft and how widely and aggressively to prosecute it over time. When a decision is made not to file an application, does the inquiry end there? For most companies it does. But others will consider preparing what is known as a “defensive publication” covering the disclosure.

As businesses and offices prepare to reopen, the United States Patent and Trademark Office (USPTO) shows its ongoing support for innovation and entrepreneurship during the novel coronavirus outbreak. Silver linings for trademark owners and patent applicants are highlighted below. It is an excellent time for trademark owners to file new applications. As noted, the downturn in the number of new applications filed has increased the processing times for marks to reach examination and proceed toward registration.

A single alphabet letter mark may face a bigger challenge in some jurisdictions than others. Take the example of Prince Sports International Company Ltd.’s stylized letter “P”. The Korean Trademark Act prevents registration of “a trademark that consists solely of a simple and common mark” under Article 33(1)(6). Prince Sports International Company Ltd., a Hong Kong-based company that manufactures sports goods, sought to register “P” as its trademark for jewelry, computers, online shopping mall businesses, etc. in Korea. It had already registered the same mark in the United States, Australia, and China, among other countries. In the United States, it is registered as Prince Sports, Inc.’s stylized word mark for tennis rackets. However, the Korean IP Office (KIPO) examiner rejected the application under the Korean Trademark Act, Article 33(1)(6)(a trademark that consists solely of a simple and common mark may not be registered) and Article 33(1) (7)(nondistinctive trademarks that do not serve as a source identifier for other reasons are also unregistrable).

Last week, the U.S. Court of Appeals for the Federal Circuit (CAFC) affirmed a decision of the U. S. District Court for the Southern District of Florida in Electronic Communication Technologies, LLC. v. ShoppersChoice.com, LLC. In particular, Electronic Communication Technologies, LLC (ECT) sued ShoppersChoice for infringement of claim 11 of U.S. Patent No. 9,373,261 (“the ’261 patent”) in the district court. The district court granted ShoppersChoice’s motion for summary judgment that claim 11 of the ’261 patent was invalid under 35 U.S.C. § 101. ECT appealed and the CAFC affirmed. Judge Prost delivered the opinion for the Court.

On July 29, 2019, U.S. patent application serial number 16/524,350 was filed with the U.S. Patent and Trademark Office (USPTO), with the sole inventor identified as artificial intelligence named “DABUS.” The assignee, Stephen Thaler, acknowledged that the invention was made by the creativity machine, without any human input. The USPTO issued a notice of missing parts, requiring identification of each inventor by name. Thaler then petitioned that the missing parts notice be vacated, which was denied, and Thaler petitioned for reconsideration. The USPTO issued its decision on the reconsideration petition on April 29, 2020, again denying the petition and concluding that the patent laws required a natural person as an inventor. The decision asserts that conception is the touchstone of invention, as the formation in the mind of the inventor of a definite and permanent idea of the complete and operative invention as it is to be applied in practice. However, this decision is too narrowly focused, and should be reversed by the U.S. Court of Appeals for the Federal Circuit if Thaler appeals the USPTO ruling.

Yesterday, U.S. Senators Thom Tillis (R-NC), Richard Blumenthal (D-CT), John Cornyn (R-TX), and Ben Sasse (R-NE) sent a letter to Federal Bureau of Investigation (FBI) Director Christopher Wray and Cybersecurity and Infrastructure Security Agency (CISA) Director Christopher Krebs regarding a notice issued last week by their agencies alerting American companies and research institutions about attempted attacks by hackers affiliated with the Chinese government.  According to the notice, these hackers “have been observed attempting to identify and illicitly obtain valuable …. (IP) and public health data related to vaccines, treatments, and testing from networks and personnel affiliated with COVID-19-related research.”

Despite rumors that changes have been made at the USPTO to bring balance to the Patent Trial and Appeal Board (PTAB), a hard look at the data shows that it is business as usual. Astounding numbers of patents continue to be invalidated, despite many superficial changes over the past few years. Several hundred institution decisions have been issued under these changes, establishing a statistically significant sample size for evaluation. Detailed analysis of the data proves that nothing has changed at the PTAB which continues to permit abuse and invalidate an astoundingly high percentage of patents. The “death squad for patents” is as lethal as ever.

The U.S. Court of Appeals for the Federal Circuit, in a precedential decision authored by Judge Taranto, today affirmed-in-part, vacated-in-part and remanded a decision of the U.S. District Court for the Central District of California in McRO, Inc. v. Bandai Namco Games America Inc. et. al. The case derives from the 2016 Federal Circuit decision determining that McRO’s challenged patent claims were directed to the display of lip synchronization and facial expressions of animated characters, which the court said were not directed to an abstract idea and were therefore patent eligible subject matter under 35 U.S.C. 101. In today’s ruling, the Court considered whether the district court’s decision on remand, which held that the Developer defendants and defendant-appellees “were entitled to summary judgment of noninfringement because the accused products do not practice the claimed methods and to summary judgment of invalidity because the specification fails to enable the full scope of the claims,” was correct.