Posts Tagged: "intellectual property"

On the morning of Monday, January 13, the U.S. Supreme Court heard oral arguments in Lucky Brand Dungarees Inc. v. Marcel Fashion Group Inc. The case asks the High Court to decide “whether, when a plaintiff asserts new claims, federal preclusion principles can bar a defendant from raising defenses that were not actually litigated and resolved in any prior case between the parties.” While the case originally involved allegations of trademark infringement, oral arguments indicated that the Justices of the Supreme Court will issue a decision with far-reaching implications on the question of what constitutes a single cause of action.

Yesterday was a dark day for patent eligibility in America. The United States Supreme Court denied certiorari in five more petitions relating to patent eligibility challenges. Based on our count, this brings the total number of patent eligibility petitions denied by the Supreme Court to at least 48, since the Court issued its controversial, if not catastrophic, decision in Alice Corporation vs. CLS Bank, 134 S.Ct. 2347 (2014). Obviously, the Supreme Court is perfectly comfortable with the status quo as it pertains to the law of patent eligibility. This reality evokes myriad emotions, ranging from despair to outrage to resentment to cynicism to exasperation and finally to a begrudging acceptance. Even with Justice Gorsuch hiring clerks with an intellectual property background – an extreme rarity at the Supreme Court – there seems to be no willingness or desire to clean up the mess this Court created when it ignored the doctrine of stare decisis, several generations of well-established law, and the 1952 Patent Act itself, which had been interpreted by the Supreme Court based on the explicit language of 35 U.S.C. 101 and the legislative history to make “anything under the sun that is made by man” patent eligible. Diamond v. Chakrabarty, 447 U.S. 303 (1980) (citing S. Rep. No. 1979, 82d Cong., 2d Sess., 5 (1952); H. R. Rep. No. 1923, 82d Cong., 2d Sess., 6 (1952)).

U.S. patent grants grew by 15% from 2018 to 2019, with IBM heading the pack for the 27th consecutive year, according to IFI CLAIMS Patent Services’ 2019 report. There were 333,530 U.S. patents granted last year, compared with 288,832 in 2018, which represented a 3.5% decline from 20I7. IFI said the growth could possibly be attributed to examiner clarity on patent eligibility following the USPTO’s guidance on Alice, as illustrated in IPWatchdog’s article by Kate Gaudry last year.

To the surprise and sorrow of some, but the relief of others, the Supreme Court earlier today denied certiorari in some key cases on patent eligibility law, putting any hope of further clarity in this realm squarely in the hands of Congress. Many see this as a dereliction of the Court’s duty, while others are just thankful the Court will not cause further harm than it already has. Commenting on the development, IPWatchdog CEO and Founder Gene Quinn tweeted out his view that this was a “bad day for patent eligibility” and that the denial of Athena ultimately “means medical diagnostics are NOT patentable in America.”

This week in Washington-based IP events, the Senate will host a series of committee hearings to explore the United States-Mexico-Canada Agreement (USMCA) implementation bill recently passed by the House of Representatives, although political turmoil in D.C. is expected to delay the Senate’s passage of that legislation. The Senate Commerce Committee will also convene a hearing this week to focus on how the U.S. can maintain a competitive edge in several areas of innovation. Over in the House, the Small Business Committee will discuss findings on minority and women patenting rates in the recent SUCCESS Act study. Other House committees will focus on steps towards a carbon-free shipping industry, facial recognition technologies, and new frontiers in energy science research. Elsewhere in D.C., the Information Technology and Innovation Foundation will look at ways that the EU is planning on funding research and development across Europe, and the Brookings Institution will host an event on the ethical use of AI algorithms.

The Supreme Court this morning released its orders list, in which it denied all pending petitions for certiorari on cases concerning patent eligibility. The Court has now made it fully clear that it does not plan to wade back into the Section 101 debate, leaving it up to Congress to clarify the law. Thus—with an impeachment trial and presidential election looming this year—a quick 101 fix seems increasingly unlikely. The Court considered a number of petitions concerning Section 101 on Friday. Of them, Athena Diagnostics v. Mayo Collaborative Services was thought to have the best chance of being granted. In December, the United States Office of the Solicitor General (SG) weighed in on the petition in Hikma Pharmaceuticals v. Vanda Pharmaceuticals, recommending against granting cert in that case in favor of hearing one like Athena instead.

As companies grow their digital business, many R&D organizations transition to Agile innovation practices*, both in software and hardware development. Any implementation of Agile leads to key changes in how firms innovate. Changes include how R&D objectives are set, how resource prioritizations are made, and how fast development cycles are run. Instead of the traditional approach of setting goals early on and seeing changes as unwanted deviations from plan, Agile brings a state of constant evolution, as Agile teams find, solve and reformulate problems to create as much customer value as possible. Resource prioritization is more active and selective as Agile empowers and requires teams to direct resources to the features and unsolved problems with highest priority. Development cycles shorten as Agile emphasizes quick sprints with autonomous teams having end-to-end skills.

U.S.-based online outdoor goods retailer, Backcountry.com, has faced a significant social media backlash over the past month, with both customers and competitors publicly reacting to its aggressive trademark enforcement campaign. It all started when news broke that the brand had taken action against a huge number of smaller companies that happened to use the term “backcountry” in their names. Public documents revealed that Backcountry.com had been attempting to cancel trademarks against businesses using the term, filing lawsuits against a multitude of smaller companies over the past two years. The impact was far ranging, with disputed trademarks, product and business names including American Backcountry, Backcountry Babes, Marquette Backcountry Skis, Backcountry Denim Co., Backcountry Nitro, Cripple Creek Backcountry and many more.

On January 9, the Court of Appeals for the Federal Circuit (CAFC) affirmed a decision of the U.S. District Court for the Northern District of Illinois, holding claim 6 of U.S. Patent No. 8,648,106 (the ‘106 patent) invalid as obvious. The ‘106 patent, owned by Hospira, Inc. (Hospira), is one of many patents covering Hospira’s dexmedetomidine products under the brand Precedex, such as the ready-to-use Precedex Premix product. Hospira sued Fresenius Kabi USA LLC (Fresenius) for infringement of claim 6 of the ‘106 patent, over its filing of an Abbreviated New Drug Application (ANDA) regarding its ready-to-use generic dexmedetomidine product.

In Part I of this article, we discussed the underpinnings of U.S. patent policy today: the fundamental assumption that our patent problems stem from a bad actor (patent troll) that takes advantage of the system. Based on this ideological premise, Congress and the Judiciary have structured patent policy to prevent this bad actor from taking advantage of the system, i.e., increasing enforcement hurdles to deter the bad actor. Rather than helping, this policy has led to the systemic weakening of U.S. patent rights over the past decade+ – so much so that it has undermined the United States as a viable jurisdiction to enforce patent rights. Here in Part II, we’ll discuss how the ideology of the bad actor came to be, how a rational actor model provides a more realistic framework, and how we can use economic underpinnings of a rational actor to create an economically rooted patent policy.

As the European Union’s landmark Global Data Protection Regulation (GDPR) was set to go into effect in 2018, the Internet Corporation for Assigned Names and Numbers (ICANN) engaged in a series of important, albeit belated, community consultations, with the objective of resolving perceived community concerns with legal compliance of the “Look Up” system (previously called the “WHOIS” system) with data protection laws, such as the GDPR. The end result of the consultations resulted in ICANN adopting a “Temporary Specification” (Temp Spec) – a new contractual provision allowing its accredited-registrars and registries to perform a wholesale redaction of the registration data that has historically been made available to the public.

Despite the possibility that the judges of the Patent Trial and Appeal Board (PTAB) may have been unconstitutionally appointed, as held recently by a Federal Circuit panel, it is hard to imagine the Federal Circuit (or the Supreme Court) throwing out nearly a decade of USPTO policies and PTAB jurisprudence relating to administrative patent trials under the 2011 America Invents Act (AIA). Stay tuned for a probable en banc rehearing of the Arthrex decision in 2020. That being said, a lot happened at the PTAB in 2019. Early in 2019, the PTAB designated as “precedential” an opinion in the Lectrosonics case explicitly adopting the practice called for by the Federal Circuit in the 2017 Aqua Products case of placing the responsibility on the petitioner who challenges a patent to also show that any amendments presented by the patent owner are also invalid. This was followed by proposed formal rules in October 2019 codifying the Lectrosonics holding that the petitioner who initiates a patent challenge will not only have the burden of persuading the PTAB that a patent owner’s claims as issued are invalid but will also have the same burden with regard to claim amendments during the proceeding. The USPTO should finalize this rule shortly.

On December 31, the United States Patent and Trademark Office’s (USPTO’s) Commissioner for Trademarks, Mary Boney Denison, retired from her position with the agency. Denison joined the USPTO in 2011 as Deputy Commissioner for Trademark Operations and became Commissioner for Trademarks on January 1, 2015. Before joining the USPTO, she practiced law in the area of trademark prosecution and litigation, as a founding partner of Manelli Denison & Selter PLLC in Washington, D.C., from 1996 to 2011, and as a partner of Graham & James LLP for ten years. The USPTO has not yet named the next Commissioner for Trademarks. Deputy Commissioner for Trademark Operations Meryl Hershkowitz will be acting in the role until the new commissioner is named. In late December, IP Watchdog had the opportunity to interview Denison about her career and her accomplishments at the USPTO. Below, she discusses what she is most proud of, what she could have done better, and provides an update on the Office’s efforts to combat fraudulent trademark filings from China, which has proven to be a major stumbling block for the agency in recent years.

Since the Supreme Court’s Alice decision in 2014, the Judiciary’s development of 101 law has caused such an upheaval, Congress may need to intervene. In a July 2018 joint position paper entitled “Congress Must Remedy Uncertainty in 35 U.S.C. §101 and Return Balance to the U.S. Patent System,” the American Bar Association’s IP Law section, the IP Owner’s Association, and the American Intellectual Property Law Association contended the “Supreme Court’s jurisprudence has injected significant ambiguity into the eligibility determination . . . .” and there is now “[u]ncertainty about what types of inventions qualify at the most basic level for patenting.” This ambiguity, however, may be a blessing in disguise. By creating demand for Congress’ intervention, we have an opportunity to change course from the patent policy that has resulted in this mess. But to turn a corner, Congress needs to first understand the shortcomings of its and the Judiciary’s fundamental assumptions that have created this situation. For more than a decade, both Congress and the Judiciary have approached patent policy from a foundational presumption: the inherent problem with our patent system stems from a bad actor.Under a single-minded bad actor presumption, the Judiciary and Congress have framed our patent policy to increase roadblocks for this bad actor, to prevent it from taking advantage of the system. But this presumption has spawned a policy that is contrary to economic principles, and it has systematically weakened and undermined the U.S. patent system. Even if Congress manages to fix 101 law, if it fails to correct its and the Judiciary’s foundational shortcomings regarding patent policy for the past decade+, we’re doomed to repeat mistakes of the past. If, on the other hand, we switch our patent policy principles to a rational actor model, we can begin to understand our patent system from a foundation rooted in economics. More importantly, we can use economic principles to improve our patent system.

The European Patent Office has refused two European patent applications that designated an artificial intelligence called DABUS as the inventor, following a non-public hearing on November 25, 2019. The applications are for a “food container” (number EP3564144) and “devices and methods for attracting enhanced attention” (number EP3563896). They were filed by the Artificial Inventor Project, which has so far filed patent applications for the inventions via the Patent Cooperation Treaty (PCT) in the United States, United Kingdom, Germany, Israel, China, Korea and Taiwan.