Posts Tagged: "US Supreme Court"

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)).

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.”

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.

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.

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.

In KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398 (2007), the United States Supreme Court discussed legal principles of obviousness in the patent context. Justice Anthony Kennedy wrote for the Court: “Common sense teaches, however, that familiar items may have obvious uses beyond their primary purposes, and in many cases a person of ordinary skill will be able to fit the teachings of multiple patents together like pieces of a puzzle.” This simile, comparing obviousness analysis to the fitting together of pieces of a puzzle, has been referenced and quoted by a number of trial and appellate courts. Expert witnesses have used it in their testimonies. It also appears twice in the current Manual of Patent Examining Procedure (MPEP). With due respect to former Justice Kennedy, may we dispense with this terrible analogy? Although it has at least one redeeming aspect, the puzzle simile does more to confuse than to enlighten.

As we explained in Part I of this series yesterday, this December marks the end of a decade as well as 2019. In reflecting on the top 10 patent stories from 2010 to 2019, we acknowledge that there will undoubtedly be disagreements and mentioned yesterday that some big cases, like Mayo v. Prometheus and TC Heartland LLC v. Kraft Foods Group…

This year, we wind down not only the year, but the decade. So, it is time to reflect upon the biggest patent related stories of the last ten years. As with any Top 10 list or ranking, there will undoubtedly be disagreements. For example, be forewarned, Mayo v. Prometheus did not make the list, but rest assured the ineptitude of the Supreme Court with respect to patent eligibility is well represented. Before jumping to the top 10, represented in chronological order, I want to mention several honorable mention stories that were close but didn’t make the list. First, although completely inconsequential, on June 22, 2015, in Kimble v. Marvel, the United States Supreme Court rejuvenated a 50-year-old rule that limits collecting patent royalties after a patent expires. In that decision the Supreme Court cited the importance of stare decisis, saying that there needs to be an overwhelmingly important rationale for disturbing well settled law, which is laugh-out-loud funny given how they did precisely that when they completely rewrote all of patent eligibility law with Bilski, Myriad, Mayo and Alice this decade. I’m sorry, but the Supreme Court citing stare decisis shows just how out of touch and ignorant they have collectively become.

On December 2, the U.S. Supreme Court heard oral argument in the matter of Georgia v. Public.Resource.Org, Inc. The issue on appeal was on whether annotations to the Official Code of the State of Georgia, which were prepared by Mathew Bender & Co under the supervision of Georgia’s Code Revision Commission, which was itself created by Georgia’s General Assembly, were capable of copyright protection, or whether they were an integral part of the laws of the State of Georgia, which, like all legislation, is part of the public domain and cannot be copyrighted. The outcome of this decision will affect legal publishing schemes in a number of states which, similar to Georgia, contract the work of preparing annotations to private sector companies, which then monetize those copyrights through a license fee structure. Indeed, concern for states’ publishing schemes led to the Solicitor General’s office and various other states joining in on the side of petitioner, the State of Georgia, who is seeking to establish that the annotations are subject to copyright. The case also presents a fascinating, almost philosophical discussion on the nature of annotations and the legal or persuasive force they should be afforded.

On November 8, the U.S. Supreme Court granted a Petition for Writ of Certiorari from the U.S. Patent and Trademark Office (USPTO) on the following issue: “Whether the addition by an online business of a generic top-level domain (“.com”) to an otherwise generic term can create a protectable trademark.” The issue stems from Booking.com B.V.’s attempt to register four versions of the trademark “booking.com” for, among other services, “making hotel reservations for others.” The applications, filed in 2011 and 2012, were refused by the USPTO on the grounds that “booking” and “.com” are generic terms which, when combined, nonetheless create a generic term which describes the travel agency and reservation services. In general, generic terms do not function as trade or service marks and cannot be registered.

We live in a world where data has become an increasingly valuable asset and huge companies are built on the collection and analysis of publicly available data. Yet, there is no federal statute that directly protects this type of information or even directly addresses how this information should be treated. Instead, businesses are often forced to rely on the Computer Fraud and Abuse Act (CFAA) in order to protect this valuable asset or commodity, which originally only provided criminal sanctions and was enacted to address computer hacking. Most recently, the Ninth Circuit in hiQ Labs, Inc. v. Linkedin Corp., 938 F.3d 985 (9th Cir. 2019), addressed under what circumstances a company may legally “scrape” data from another company’s website. There, the court determined on hiQ’s motion for preliminary injunction that “scraping” publicly available information from LinkedIn likely is not a violation of the CFAA because the LinkedIn computers are publicly accessible and hiQ thus did not access the computers “without authorization” as required by the CFAA. Under these circumstances, the court determined that it did not matter that LinkedIn had sent a cease and desist letter to hiQ prohibiting such access. This is a potentially very important decision for companies on both sides of this issue and for the general public, at least in the Ninth Circuit.

Five years after the last of the four decisions in patent eligibility doctrine by the Supreme Court—creating what is now referred to as the Alice-Mayo framework—the impact of this upheaval in the patent system has become even more clear. Ongoing court decisions and new data confirm that the Alice-Mayo framework has wrought an unsettling revolution and sowed uncertainty in what former U.S. Patent and Trademark Office (USPTO) Director David Kappos has referred to as the “the greatest innovation engine the world has ever known.” As policy debates on subject matter eligibility ramped up this past year, it is time to return back to the original dataset created by Robert Sachs and David Kappos that we presented in Turning Gold to Lead and provide an update.

The Supreme Court ruled in Peter v. NantKwest today that the U.S. Patent and Trademark Office (USPTO) cannot recover the salaries of USPTO attorneys and paralegals who work on civil actions against the USPTO Director in the Eastern District of Virginia. The Court held that the language of Section 145 of the Patent Act, which says that applicants must pay all the expenses of the proceedings for a civil action, “does not overcome the American Rule’s presumption against fee shifting.” The USPTO argued that the Federal Circuit’s en banc 2018 decision holding “all expenses” does not include “expenses that the USPTO incurs when its employees, including attorneys, defend the agency in Section 145 litigation,” is inconsistent with the ordinary meaning of  “expenses” and Section 145’s “history and purpose.”

The Supreme Court heard oral arguments on Monday in Thryv, Inc. v. Click-to-Call Technologies. The case asks the nation’s highest court whether 35 U.S.C. § 314(d)—which states that decisions to institute inter partes review (IPR) proceedings shall not be appealable—permits appeals of PTAB institution decisions based upon 35 U.S.C. § 315(b)— which states that IPRs won’t be instituted if the patent owner served the petitioner with a complaint for patent infringement more than one year prior to the petition. The U.S. Court of Appeals for the Federal Circuit ruled in August 2018 in a panel rehearing that the Patent Trial and Appeal Board (PTAB) had “committed legal error” in rendering its determination that an IPR petition challenging claims of Click-to-Call’s patent was not time-barred under Section 315(b). All 12 judges joined a footnote finding that the Section 315(b) time bar applies even when the earlier infringement action had been voluntarily dismissed without prejudice. Here is what those who have reviewed the transcript of Monday’s oral arguments had to say

Athena Diagnostics today filed its reply brief to Mayo Collaborative Services at the Supreme Court in the closely-watched petition asking the High Court to clarify U.S. patent eligibility law. The reply reiterates the points made in Athena’s petition for certiorari and dismisses Mayo’s argument in November that “any further action regarding the patentability of medical diagnostic claims such as Athena’s that employ conventional, known techniques should and does rest with Congress.” The reply comes three days after the United States Solicitor General recommended that SCOTUS grant cert in Athena or “another such case”, rather than in Hikma Pharmaceuticals v. Vanda Pharmaceuticals.