Posts Tagged: "patent infringement"

The availability of high speed Internet access (HSIA) is a major factor determining consumer satisfaction when staying in hotel or resort lodgings, and it’s this market where Blueprint RF has been stepping into Nomadix’s IP territory. “It’s fairly widely known that Nomadix has patents protecting this technology,” said Doug Muehlhauser, a partner at the Knobbe Martens law firm and the lead litigation counsel for the Nomadix infringement case. Both he and Mark Lezama, another Knobbe Martens litigation partner, were able to offer us more insight into the legal case. This kind of infringement case is exactly why the patent system exists, Muehlhauser said. “People should really be acknowledging the value of this technology, but some participants in the market are not willing to do that,” he said.

In a painfully long decision that at one point analyzed a 1628 statement of Lord Coke as relating to British common-law principles and what light that might shed on modern day patent exhaustion, the Federal Circuit held that when a patentee sells a patented article under otherwise-proper restrictions on resale and reuse communicated to the buyer at the time of sale, the patentee does not confer authority on the buyer to engage in the prohibited resale or reuse. The patentee does not exhaust its rights to charge the buyer who engages in those acts—or downstream buyers having knowledge of the restrictions—with patent infringement. The Federal Circuit also held that a foreign sale of a U.S. patented article, when made by or with the approval of the U.S. patentee, does not exhaust the patentee’s U.S. patent rights in the article sold, even when no reservation of rights accompanies the sale. Loss of U.S. patent rights based on a foreign sale remains a matter of express or implied license.

The victory, if it stands, will encourage more design patent infringement claims, and Apple will likely find itself defending against similar suits in the not so distant future. On December 14, Samsung filed a petition asking the Supreme Court to hear an appeal in the case. Given the economics of future litigation, Apple might quietly hope that the Court takes the opportunity to articulate the appropriate standard for awarding total profit damages for infringement.

Future Motion launched a successful Kickstarter campaign to fund the earliest prototypes of the OneWheel on January 6th, 2014. Within 24 hours, the project had already collected 40 percent of the funds it needed for the next phase of development. Within three days, it had secured 85 percent of its funding request and it only took a total of four days to reach the $100,000 pledge goal that Future Motion had initially set out to achieve. All told, Future Motion received a total in excess of $630,000 within 25 days and was able to meet stretch goals for LED lighting systems and mobile app development.

The Court agreed, noting testimony from Cisco’s engineer who stated that the system needed only one copy of the protocol to support all devices. Commil’s expert opined that the protocol was a state machine, and since Cisco’s devices tracked separate information regarding their communication states, each communication state represented a copy of the protocol that was unique. The Court disagreed, finding that tracking separate states for each device was not substantial evidence that each device ran a separate copy of the protocol.

The Court held that printed matter must be claimed for what it communicates, and it is only afforded patentable weight if the claimed informational content has a functional or structural relation to the substrate. In this case, the Court held that the Board erred in finding that the origins of the web assets made them printed subject matter, because nothing in the claim called for the origin to be part of the web asset.

While we tend to think of Las Vegas’ tourism-based economy as built on gambling, trade shows also bring hundreds of thousands of visitors to the city each year. Thus, the issue of effective enforcement of the patent laws at these trade shows becomes entwined with the health of the city’s economy. Against this backdrop, the Las Vegas bench of the U.S. District Court for Nevada has developed a muscular set of equitable remedies for U.S. patent holders who complain to the court of patent infringement by a trade show exhibitor, remedies that the court can and does deploy with sufficient speed to be effective within the narrow timeframe of a trade show.

Wi-LAN argued that even if they could not prove direct infringement, a structure that performs the steps in the reverse order should properly be found to infringe under the doctrine of equivalents. Curiously, the Federal Circuit disagreed despite finding the Wi-LAN argument to have merit. Exactly how the Federal Circuit came to the determination that there was substantial evidence to support the jury verdict on the doctrine of equivalents is unclear.

If the allegations in the Valencell complaint against Apple proves to be true, the dispute between Valencell and Apple yet another example of a small company that was lead astray by a larger company pretending to want to license their technology only to get a better look so they could shamelessly copy without regard to whether they infringed any existing patents. Indeed, the complaint says that would be in keeping with Apple’s long standing policy, quoting Steve Jobs as having said that Apple has “always been shameless about stealing great ideas.” See Complaint paragraph 14.

So it now looks like this: if you are a patent owner and feel that your rights have been encroached upon, you now have to assume there will be a challenge to their validity by a potential licensee through an Inter Partes Review (IPR). If you are one of the lucky few (~25%) who survive such a challenge with at least one valid patent claim, you then have to expect an appeal. Assuming you win that appeal, then the real court battle starts in earnest and you’ll have to face what has now become a $3-5M ordeal in legal fees to get through a full trial on the merits and the routinely filed appeal should you beat all odds and win. Treble damages for willful infringement have been rarer than a dodo bird sighting and even winning does not mean you will collect your money any time soon, as the Apple-Samsung saga has recently shown.

Would you consider a business owner who prevented someone from breaking into their store and stealing a tangible product to be a bully? Of course not! They would be taking reasonable steps to protect themselves, and their property, from the thug who was stealing. But if that is the case, why then would you consider a patent owner who protects and defends their rights to be a bully? The truth is you could only consider a patent owner to be a bully if you do not believe patents are a property right. While everyone is entitled to hope and dream, we do have a definitively correct answer. The Patent Act unambiguously says: “patents shall have the attributes of personal property.” See 35 U.S.C. 261. Thus, if a shop owner defending a tangible item against a thief is not bullying then neither is a patent owner defending rights against an infringer.

If patent owners do not have the financial resources to pursue infringers the patent becomes nothing more than a wall decoration – a very expensive wall decoration. And getting funding is more difficult than ever. According to Ashley Keller, Managing Director of Gerchen Keller Capital, speaking on the last panel of the day on Monday at the IP Dealmakers Forum in New York City, they are funding 1 out of ever 100 cases they review these days.

We have all heard it. We all know it happens. Large company takes a look at what small company is working on, refuses to do a deal and then miraculously thereafter starts to infringe. In this, as in many cases, there was a confidentiality agreement, but what good is such an agreement without the means to enforce it? Even worse, it appears as if in this case the larger company had the audacity to file a patent application of their own after being granted access to what was supposed to be confidential information. Unfortunately, Congress and the Courts seem singularly focused on protecting helpless large multinational corporations who, as the story goes, are getting bullied by patent owners. That just isn’t the reality I see.

In a November 10 ruling, the Federal Circuit held that routine quality control testing of each batch of a generic drug as part of the commercial production process, after FDA approval, is not protected by the Hatch-Waxman safe harbor provision of 35 U.S.C. § 271(e)(1). However, infringement only occurs under 35 U.S.C. § 271(g), as a result of “making” a product, which does not include quality control testing.

Consumers benefit most when patents are strongest and act to block actors. When competitors are blocked that means they cannot simply copy and flood the market with knock-offs or products that at their core are essentially identical. Competitors that are blocked by strong patents have a choice. Either they ignore the patent rights and infringe, which is sometimes the choice made particularly when a small company or individual owns the patent and it is believed they can be bullied. Alternatively, competitors must figure out how to design around the patents in place and find new, creative ways to do what they want to do. When patents are designed around that is when paradigm shifting innovation can and does happen. Unfortunately, thanks to the Supreme Court and Congress we have a patent system that today incentivizes copycats and bullying of innovators.