Patent Law Review - IP Year in Review CLE v2
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This document provides a summary of a presentation on recent developments in patent law given to the Oregon State Bar Intellectual Property Section. It discusses several topics, including proposed patent legislation, practice before the International Trade Commission and Patent and Trademark Office, as well as recent decisions from the Federal Circuit and Supreme Court that have impacted patent law. The presentation was delivered by Bryan Beel of Perkins Coie LLP on February 14, 2014.
![Interdigital Commc’ns v. ITC
• Broad view of when licensing activities can satisfy the
“domestic industry” requirement
• Section 337 relief requires a domestic industry “relating to the
articles protected by the patent,” but such an industry exists if
there is “substantial investment in [the patent’s] exploitation,
including engineering, research and development, or licensing”
• ITC held that substantial investment in domestic licensing is
sufficient and that actual domestic production of articles
practicing the patent is not required
• Divided Federal Circuit panel agreed
InterDigital Commc’ns, LLC v. USITC, 707 F.3d 1295 (Fed. Cir. 2013); Google Scholar
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![PTAB Trials: Hard Line on Submissions
• CBS Interactive Inc. v. Helferich Patent Licensing, LLC
• Parties completed all pre-hearing proceedings and briefing
• Patent owner’s counsel initiated call the afternoon before
the final oral hearing: What is appropriate content for
demonstratives at the oral hearing?
• Answer: No content.
• “In light of the number of non-compliant slides involved,
and the inefficiencies of sorting through all of the slides,
one by one, the Board exercised its discretion to not all
presentation of [any slides] at final oral hearing.”
Board’s cite: Patent Trial Practice Guide, 77 Fed. Reg. 48756, 48768 (Aug. 14, 2012).
21](https://image.slidesharecdn.com/05dd35d3-3936-4bfe-9959-afff1c9b46ab-150128090027-conversion-gate01/85/Patent-Law-Review-IP-Year-in-Review-CLE-v2-21-320.jpg)
![Accenture v. Guidewire (continued)
• Lourie + Reyna majority (continued):
• Idea: generate rules-based tasks to be completed after event
• Not enough simply to limit that idea to the insurance industry
and a computer environment
• Claims didn’t require the detailed implementation in the spec
• Distinguished Ultramercial based on its procedural posture and
the inclusion there of meaningful limitations in the claims
• Rader dissent:
• Non-appeal of method claims just a strategic choice, not estoppel
• Claims required a specific combination of computer components
and didn’t stop others from using the general idea
• Lamented “pervers[e] standard without rules”
35](https://image.slidesharecdn.com/05dd35d3-3936-4bfe-9959-afff1c9b46ab-150128090027-conversion-gate01/85/Patent-Law-Review-IP-Year-in-Review-CLE-v2-35-320.jpg)
Patent Law Review - IP Year in Review CLE v2
- 1. Patent Law Review Oregon State Bar 2013 Intellectual Property Review Bryan Beel 503.727.2000 [email protected] Prepared for Presented by February 14, 2014
- 2. Topics • Patent Legislation • ITC Practice • PTO Practice • Federal Circuit Developments • Supreme Court Developments • The Changing Federal Circuit 2
- 4. Innovation Act (Goodlatte bill/H.R. 3309) 1. Cost shifting 2. Disclosure of real party-in-interest 3. Stay of litigation against end users 4. Heightened infringement pleading standard 5. Post-grant review and inter partes review 6. Expands Covered Business Method patent review 7. Core discovery and discovery fee shifting 8. Bankruptcy protection 9. Double patenting 10. Bad faith demand letters Source: Library of Congress THOMAS 4
- 5. Other Legislation • H.R. 3540 (Polis) – focuses on bad-faith demand letters (PTO database, disclosure requirements, detailed infringement allegations, sanctions) • S. 1720 (Leahy) – Real party, stays, PGR/IPR, bankruptcy, double patenting, demand letters • S. 1612 (Hatch) – Costs/fees to prevailing party, with exceptions; court may require “infringement allegation bond” • S. 1013 (Cornyn) – fees, real party, pleading, discovery • S. 866 (Schumer) – Eliminates sunset of CBM review More information: THOMAS (http://thomas.loc.gov/home/thomas.php) 5
- 6. ITC Practice
- 7. ITC Practice – Domestic industry Interdigital Communications v. ITC
- 8. Interdigital Commc’ns v. ITC • Broad view of when licensing activities can satisfy the “domestic industry” requirement • Section 337 relief requires a domestic industry “relating to the articles protected by the patent,” but such an industry exists if there is “substantial investment in [the patent’s] exploitation, including engineering, research and development, or licensing” • ITC held that substantial investment in domestic licensing is sufficient and that actual domestic production of articles practicing the patent is not required • Divided Federal Circuit panel agreed InterDigital Commc’ns, LLC v. USITC, 707 F.3d 1295 (Fed. Cir. 2013); Google Scholar 8
- 9. Interdigital Commc’ns v. ITC, cont. • Majority opinion of Bryson + Mayer on rehearing: • Section 337 relief is available where a party makes a substan- tial investment in exploitation by engineering, R&D, or licensing • Here IDC invested substantial $ and that investment was w.r.t. protected articles because both products licensed by the patentee and the accused products practiced the patent • No need for the complainant or any other party to manufacture covered articles domestically • Newman dissent: • Licensing importation of foreign-made product shouldn’t be enough 9
- 10. ITC Practice – Direct infringement only Suprema v. ITC
- 11. Suprema v. ITC • Exclusion orders may not be based on inducement theory where direct infringement occurs after import • O’Malley + Prost: • ITC may only bar “articles that infringe,” and those are articles that infringe at the time of importation • Intent of the importer is irrelevant • Reyna dissent: • Article need not currently infringe as long as importation is part of infringing act of inducement • Majority’s rule creates loophole in Section 337 Suprema, Inc. v. USITC, No. 2012-1170, -1026, -1124 (Fed. Cir. Dec. 13, 2013); Google Scholar 11
- 12. PTO Practice
- 13. PTO Practice – New rules/practices
- 14. New Patent Office Rules • First-inventor-to-file provisions • Revised Patent Office fee schedule • USPTO Rules of Professional Conduct • Patent Law Treaty • Changes filing date requirements for a patent application • Allows revival of abandoned applications and acceptance of delayed maintenance fee payments • Permits restoration of a right of priority to a foreign application, or benefit of a provisional application in a subsequent application filed within two months of the twelve-month deadline 14
- 15. Accelerated revisions to MPEP • For 2014: three editions of the MPEP • Incorporate AIA provisions • Implementation of Patent Law Treaty • Guidance on Hague Agreement concerning industrial designs Source: http://www.uspto.gov/blog/director/entry/uspto_revises_mpep_publication_process 15
- 16. PTO Practice – Inter partes review
- 17. PTAB: Rate at which IPRs instituted • Program began September 2012 as part of AIA • 90% of IPR petitions granted (though often a limited number of claims) • District Court litigation stayed ~60% of the time • Granted on about half the grounds (i.e., Sec. 102/103) • Granted on about 85% of claims challenged Source: Patent and Trademark Office data; http://www.docketnavigator.com 17
- 18. PTAB: Rate at which IPRs instituted, cont. Source: http://www.uspto.gov/aia_implementation/statistics.jsp 18
- 20. PTAB: Go to trial, lose your claims • Sample size still low, but outcomes bad for owners • Repeated invalidations; see, e.g.: • IPR2012-00001 (Garmin): 3 claims of 20 invalidated • IPR2012-00027 (Idle Free): all claims invalidated (half conceded) • IPR2013-00136 (ZTE Corp): owner conceded unpatentability of all challenged claims • IPR2013-00278 (Crestron Elecs.): owner requests cancellation of all challenged claims • IPR2013-00239 (Taiwan Semiconductor): owner requests cancellation of all challenged claims Source: http://www.docketnavigator.com 20
- 21. PTAB Trials: Hard Line on Submissions • CBS Interactive Inc. v. Helferich Patent Licensing, LLC • Parties completed all pre-hearing proceedings and briefing • Patent owner’s counsel initiated call the afternoon before the final oral hearing: What is appropriate content for demonstratives at the oral hearing? • Answer: No content. • “In light of the number of non-compliant slides involved, and the inefficiencies of sorting through all of the slides, one by one, the Board exercised its discretion to not all presentation of [any slides] at final oral hearing.” Board’s cite: Patent Trial Practice Guide, 77 Fed. Reg. 48756, 48768 (Aug. 14, 2012). 21
- 22. PTAB: You settled? That’s great, we’ll finish • Blackberry Corp. v. MobileMedia Ideas, LLC • Parties settled their dispute and filed a joint motion to terminate. • Result: terminated as to petitioner, continued as to patent owner. • Rationale: Board’s institution of proceedings meant there was a reasonable likelihood the claims were invalid, the parties filed all papers, and the Board held an oral hearing; all that’s left is to write it up. Board’s cites: 35 U.S.C. §§ 317(a), 318(a); 37 C.F.R. § 42.74(a) 22
- 24. Federal Circuit – PTO/district Court interplay
- 25. Fresenius USA v. Baxter International • PTO’s cancellation of claims required dismissal of infringement claim even after liability had been affirmed • 2009: Federal Circuit affirmed finding of infringement of one patent but remanded for recalculation of damages • 2010: PTO reexamined claims at infringer’s request and declared them invalid • While PTO ruling was on appeal to Federal Circuit, district court retried damages and entered judgment for $24 million • 2012: Federal Circuit affirmed PTO’s ruling canceling the claims • Held: PTO’s cancellation of claims trumped district court’s damages judgment, despite earlier affirmance of liability 25
- 26. Fresenius USA v. Baxter International (continued) • Dyk + Prost majority opinion: • Reexamination statute allows patentee to continue to enforce only those claims that survive in identical form • Pending cases that are based on extinguished claims fail • No difference that infringement had already been found and affirmed on appeal because the judgment on original verdict was vacated and did not have res judicata effect • Intervening invalidity determination controlled • Newman dissent: • PTO shouldn’t be able to override a final judgment by the Federal Circuit affirming a no-invalidity finding • Result: $24 Million Down the Drain 26
- 27. Federal Circuit – Computer-implemented inventions
- 28. CLS Bank v. Alice Corp. (en banc) • En banc court failed to settle the law • Patents claimed a computerized trading platform for commercial transactions in which a third party settles the obligations to eliminate performance risk • Included method, system, computer-readable media claims • District court held that the claims did not recite patent- eligible subject matter, but a divided panel reversed • Federal Circuit took case en banc and split 5–2–3 • No majority opinion doctrinal disarray • 7–3 vote to invalidate the method and media claims • 5–5 split on the system claims 28
- 29. CLS Bank v. Alice Corp. (continued) • Plurality opinion (Lourie + Dyk, Prost, Reyna, Wallach): • Focus on likelihood of “preempting a fundamental concept” • Identify the abstract idea at issue • Claim construction may be helpful but is not always required • Then see if limitations substantially narrow the scope so that the claim doesn’t effectively cover the whole idea • Here, the method claims added nothing to the abstract idea of using third-party intermediation to reduce settlement risk • Computer implementation requirement not enough • Shadow records and end-of-day reconciliation insignificant 29
- 30. CLS Bank v. Alice Corp. (continued) • Plurality opinion (continued): • Media claims were equivalent to the method claims • System claims also added no “inventive concept” • Same general steps, with computer components recited in generic functional terms • Rader + Moore partial concurrence, partial dissent: • Improper to “go hunting for abstractions by ignoring the concrete, palpable, tangible limitations” in the claims • Instead should look for meaningful limitations to particular applications of the abstract idea 30
- 31. CLS Bank v. Alice Corp. (continued) • Rader + Moore (continued): • In a computer-implemented invention, look for specific way of doing something or a specific type of computer • System claims were patent-eligible because they required specifically programmed computer components and didn’t cover all escrows or even all computerized escrows • But method and media claims were not patent-eligible because the steps were inherent in the idea of an escrow • Newman (solo), Linn + O’Malley dissents: • All three kinds of claims were similar and patent-eligible 31
- 32. Ultramercial v. Hulu • First post-CLS case, held claims patent-eligible • Claims to method where customer gets song/movie/book for free over Internet if he or she first views a sponsored ad • District court held the claims not patent-eligible • Panel unanimously reversed but split on rationale • Rader + O’Malley majority: • Should be rare to dismiss on 101 grounds at pleading stage • May need construction, facts re contribution/preemption • Focus on claim as a whole and look for concrete application • Mere recitation of a computer is not enough, but requiring a specific kind of computer is enough 32
- 33. Ultramercial v. Hulu (continued) • Rader + O’Malley (continued): • District court erred by forcing patentee to come forward with construction under which claims were patent-eligible • Should have construed claims, forced defendant to show claims ineligible under only plausible construction, or assumed construction most favorable to patentee • Viewed claims as covering a practical application of idea of advertising as form of currency • Steps required intricate, complex programming • Lourie concurrence in result: • Agreed this was a particular implementation, but disagreed with focus on computer and mere number of limitations 33
- 34. Accenture v. Guidewire • Second post-CLS case, shows continued schism • Patent on system and method of generating tasks in an insurance organization • District court held the claims were unpatentably abstract • Divided Federal Circuit panel affirmed • Lourie + Reyna majority: • Accenture conceded patent-ineligibility of method claims by failing to appeal on them, system claims were not substantially different, so system claims fall as well • System claims also defective standing alone because they added nothing to the abstract idea 34
- 35. Accenture v. Guidewire (continued) • Lourie + Reyna majority (continued): • Idea: generate rules-based tasks to be completed after event • Not enough simply to limit that idea to the insurance industry and a computer environment • Claims didn’t require the detailed implementation in the spec • Distinguished Ultramercial based on its procedural posture and the inclusion there of meaningful limitations in the claims • Rader dissent: • Non-appeal of method claims just a strategic choice, not estoppel • Claims required a specific combination of computer components and didn’t stop others from using the general idea • Lamented “pervers[e] standard without rules” 35
- 36. Federal Circuit – Claim construction
- 37. Lighting Ballast Control v. Phillips Electronics (en banc) • En banc court is currently addressing the standard of review of district court claim constructions • 1998: En banc court in Cybor mandated de novo review • Perceptions of unpredictability and high reversal rates led to calls for more deference to district courts • Case at issue: panel held that a “means for” element was governed by 112/6 and was indefinite for lack of any corresponding structure in the specification • Probable result: continued de novo review of legal conclusion and intrinsic evidence, but deference to findings of “historical fact” from extrinsic evidence 37
- 38. Lighting Ballast Control v. Phillips Electronics (en banc) • Probable result: continued de novo review of legal conclusion and intrinsic evidence, but deference to findings of “historical fact” from extrinsic evidence 38 Amici grouped by position taken Federal Circuit should stop applying Cybor (i.e., complete deference to district court) Federal Circuit should give deference to some aspects of district court claim construction Federal Circuit should continue applying Cybor (i.e., complete de novo review) None. Ad Hoc Committee of Patent Owners in the Lighting Industry American Bar Association American Intellectual Property Law Association Association of the Bar of the City of New York Association of University Technology Managers (AUTM) Colorado State University Research Foundation Connecticut Intellectual Property Law Association Delaware Chapter of the Federal Bar Association Federal Circuit Bar Association Federation Internationale Des Conseils En Propriete Intellectuelle Intellectual Property Law Association of Chicago Intellectual Property Owners Association Paul R. Michel Peter S. Menell New South Innovations Nutech Ventures, Inc. Public Patent Foundation TEC Edmonton The San Diego Intellectual Property Law Association Amazon.com, Inc. Austin Intellectual Property Law Association Cisco Systems, Inc. Dell Inc. EMC Corporation Google Inc. Hewlett-Packard Company Intel Corporation Intellectual Property Institute of the William Mitchell College of Law Microsoft Corporation Red Hat, Inc. SAP America, Inc. SAS Institute Inc. Yahoo! Inc.
- 39. Federal Circuit – Infringement
- 40. Commil USA v. Cisco Systems • Good-faith belief in invalidity can help show the lack of knowledge of infringement required for inducement • Prost + O’Malley, over Newman dissent: • No principled distinction between good-faith belief in invalidity and good-faith belief of non-infringement because one cannot infringe an invalid patent • But such a belief doesn’t necessarily preclude finding inducement • Rehearing en banc denied 6-5 • Reyna + Rader, Newman, Lourie, and Wallach dissenting: • Inducer shouldn’t get off when induced party is liable • Infringement and invalidity are separate issues • Eroding statutory presumption of invalidity 40
- 41. Brilliant Instruments v. GuideTech • Follows Deere v. Bush Hog in limiting “vitiation” doctrine • District court granted summary judgment of noninfringement of patents on time interval analyzers • Divided Federal Circuit panel reversed as to DOE • Moore + Reyna majority: • Vitation is a narrow principle that makes most sense when accused structure is the antithesis of the claimed structure • It is just a conclusion that the “function-way-result” and “insubstantial differences” tests can’t be satisfied • Here, equivalence possible under f-w-r test even though accused capacitor was part of the first circuit and not on a “parallel path” • Dyk dissented on the facts but not the law 41
- 42. Keurig v. Sturm Foods • Broad view of patent exhaustion • Lourie + Mayer: Keurig’s sale of its brewers exhausted patents on both brewers and method of brewing • Noninfringing uses of brewers were irrelevant because the “substantial embodiment” test serves only to assess when sale of an unpatented component triggers exhaustion • Exhaustion analyzed patent by patent, not claim by claim • O’Malley: Analysis claim by claim, but sale of patented item exhausts claims to normal methods of use • See also LifeScan Scotland v. Shasta Technologies (giving away meters exhausted rights in patented test strips too) 42
- 43. Federal Circuit – Validity
- 44. Apple v. ITC • Split ruling on validity of multi-touch patent claims • ITC held 7 claims anticipated, 1 claim obvious • Divided panel of Federal Circuit affirmed on anticipation but vacated the ITC’s obviousness determination • Moore + Linn majority: • Although substantial evidence supported the ITC’s findings on what the prior art disclosed, the ITC didn’t adequately consider secondary considerations including industry praise, copying, and commercial success • Held that commercial success was related to patented technology • Remanded for ITC to weigh the Graham v. Deere factors 44
- 45. Apple v. ITC (continued) • Reyna dissent: • Would have reversed and ruled for Apple on all claims • “Secondary” considerations are not secondary, but instead “strong, if not the best, evidence of innovation” • Stunning endorsement of Apple’s world view: • Intro: Apple’s claimed invention “has propelled not just tech- nology, but also dramatically altered how humans across the globe interact and communicate.” • Conclusion: “Apple’s efforts endowed users around the world with better access to information, more efficient communi- cation, and unparalleled convenience to organize life on the mobile.” 45
- 46. Plantronics v. Aliph • Summary judgment of obviousness reversed for failure to consider objective evidence of nonobviousness • Patent on in-ear headset stabilizer • District court thought it was “common sense” to miniaturize a receiver and pair it with a comfortable, adaptable ear cushion • Federal Circuit (Wallach + Rader and O’Malley) reversed • Panel demanded explicit, clear reasoning why “common sense” compelled a finding of obviousness—narrow view of KSR • Must consider objective indicia of nonobviousness (a.k.a. secondary considerations) to safeguard against hindsight bias • Here, evidence of prior failure, copying, and commercial success of defendant’s design precluded summary judgment 46
- 47. Randall Manufacturing v. Rea • “Common knowledge” makes a comeback • Patent on movable bulkhead partitions for cold trucks • Taranto + Rader and Dyk: • KSR not only permits but requires consideration of common knowledge and common sense in assessing whether a PHOSITA was motivated to combine references • Predominant method of stowing bulkhead panel was to raise it to the ceiling, so PHOSITA likely to modify prior-art design to add this feature—especially when doing so was easy 47
- 48. Federal Circuit – Remedies
- 49. Apple v. Samsung • Clarification of requirements for permanent injunction • Prost + Bryson and O’Malley: • Causal nexus is required for both permanent and preliminary injunctions because it is necessary to show irreparable harm • Patented feature or component need not be “sole driver” of consumer demand—“matter of degree” • Willingness to license other patents didn’t necessarily show that money would adequately compensate for infringing these patents • District court may consider stopped sales and design-arounds in evaluating balance of hardships • District court may also consider public interest in not enjoining sales of whole product, not just patented component 49
- 50. Douglas Dynamics v. Buyers Products • Abuse of discretion to refuse permanent injunction in high-end supplier’s suit against low-end supplier • Patentee supplied high-priced snowplow assemblies, while infringer supplied low-priced infringing assemblies • District court denied permanent injunction on grounds of no irreparable injury; instead awarded an ongoing royalty • Divided Federal Circuit panel reversed • Rader + Newman majority opinion: • Even if Douglas ≈ Mercedes and Buyers ≈ Ford, Mercedes may face irreparable harm by losing its distinctiveness and Ford may tout its cars as Mercedes at half the price 50
- 51. Douglas Dynamics v. Buyers Products (continued) • Rader + Newman majority opinion (continued): • Fact that patentee’s sales had increased was insignificant where it had invested in R&D and sales/marketing • Lack of customer confusion not determinative • Evidence showed patentee’s policy of not licensing in order to maintain exclusivity • Rise in infringer’s market share was significant • Mayer dissent: • Irreparable harm must be proven, not presumed • Parties were in different segments; patentee failed to prove lost sales and had actually increased market share 51
- 52. Power Integrations v. Fairchild Semiconductor • Another example of stringent review of damage awards • Power sued Fairchild on power supplies in phone chargers • District court threw out most of the jury’s $33M award but sustained $6M and doubled it for willful infringement • On appeal, Federal Circuit wiped out almost everything • Unanimous opinion by Reyna + Lourie and O’Malley: • Power not allowed to claim that it lost foreign sales as a result of Fairchild’s infringement in the U.S. • Power’s expert testimony should have been excluded: • Improperly relied on unreliable sales data “off the Internet” • Improperly assumed each phone included an infringing charger 52
- 53. Versata Software v. SAP America • Bad facts can still produce bad law and big awards • Versata sued SAP on patents involving use of hierarchical data structures in computerized product pricing • District court judgment: $260M lost profits, $85M royalties • Federal Circuit affirmed both awards • Rader + Prost and Moore: • SAP waived challenges to Versata’s damages methodology • Must challenge admissibility via Daubert; can’t later challenge methodology via JMOL motion on sufficiency of evidence • Lost profits: enough to show demand before SAP’s entry and continued demand for patented feature after entry 53
- 54. Versata Software v. SAP America (continued) • Rader + Prost and Moore (continued): • Panduit requirement of “selling” competing product to get lost profits doesn’t require success and actual sales • Panduit also didn’t require showing demand for a parti- cular embodiment or allocating demand across limitations • $85M reasonable royalty award on different sales also affirmed, even though Versata’s expert had been excluded • Versata was entitled to make its case by cross-examining SAP’s expert • Jury entitled to apply royalty rate to larger base that included customers who bought “bolt-on” products 54
- 55. Kilopass v. Sidense • Panel calls for more flexibility in awarding fees to prevailing defendants as Octane Fitness looms in S. Ct. • O’Malley + Lourie vacate denial of fees: • Actual knowledge of objective baselessness not required • Shouldn’t analyze subjective good faith prong separate from objective baselessness • Analyze bad faith based on totality of the circumstances • Wanted to reduce standard of proof from “clear and convincing” to preponderance, but felt bound by precedent • Rader concurrence: • Objective baselessness alone should be grounds to shift fees 55
- 56. Supreme Court Developments – Going to the Big House
- 57. Association for Molecular Pathology v. Myriad Genetics • Merely discovering the location of, and isolating, particular naturally occurring genes did not make the DNA compositions patent-eligible subject matter under § 101. • Manipulating isolated DNA structures by removing certain regions, however, qualifies as “invention” and may result in patent-eligible subject matter under § 101. 57
- 58. FTC v. Actavis • Reverse payment settlements in patent infringement litigation can sometimes violate the antitrust laws; court must perform a case-by-case rule of reason analysis to determine whether an antitrust violation occurred. 58
- 59. Bowman v. Monsanto • Patent exhaustion doctrine does not preclude Monsanto from suing a farmer for making more seeds from other seeds that he legally obtained. • Patent exhaustion is limited to the particular articles sold and doesn’t affect the patentee’s ability to prevent buyers from making more copies. • Court made clear that it was not addressing naturally self-replicating products, just this kind of product where the farmer has to intervene and plant the seeds to produce more patented items. 59
- 60. Medtronic v. Mirowski Family Ventures (Jan. 22, 2014) • Federal Circuit held that when licensee wanted relief from license, and licensor was barred from filing patent infringement counterclaims, the burden fell on licensee to prove that at least one limitation of each claim of the licensor’s patents was not met by the licensee's products. • Question Presented: whether, in a declaratory judgment action brought by a licensee under Medlmmune, the licensee has the burden to prove that its products do not infringe the patent, or whether (as is the case in all other patent litigation, including other declaratory judgment actions), the patentee must prove infringement. • Result: 9-0 reversal; when a licensee seeks a declaratory judgment against a patentee to establish that there is no infringement, the burden of proving infringement remains with the patentee. Decision: Medtronic, Inc. v. Mirowski Family Ventures, LLC 60
- 61. Medtronic v. Mirowski Family Ventures (continued) • Interesting policy hints for other cases? • The public has a paramount interest in seeing that patent monopolies are kept within their legitimate scope. A patentee should not be allowed to exact royalties for the use of an idea that is beyond the scope of the patent monopoly granted. 61
- 62. Nautilus, Inc. v. Biosig Instruments, Inc. • Federal Circuit held “spaced relationship” not insolubly ambiguous when one of skill in the art could determine the parameters that affected the spaced relationship (e.g., spacing, size, shape, material) • Question Presented: Does the Federal Circuit's acceptance of ambiguous patent claims with multiple reasonable interpretations - so long as the ambiguity is not “insoluble” by a court - defeat the statutory requirement of particular and distinct patent claiming? 62
- 63. Limelight Networks, Inc. v. Akamai Techs., Inc. • Federal Circuit held that Limelight could be liable, under 35 U.S.C. § 271(b), for inducing infringement if (1) it knew of Akamai's patent; (2) it performed all but one of the steps of the method; (3) it induced its customers to perform the final step of the claimed method; and (4) the customers performed that step. • Question Presented: Whether the Federal Circuit erred in holding that a defendant may be held liable for inducing patent infringement under 35 U.S.C. § 271(b) even though no one has committed direct infringement under § 271(a). 63
- 64. Alice Corp. Pty. Ltd. v. CLS Bank Int’l • Federal Circuit split hopelessly: en banc, 5–2–3 • No majority opinion doctrinal disarray • 7–3 vote to invalidate the method and media claims • 5–5 split on the system claims • Question Presented: Whether claims to computer- implemented inventions-including claims to systems and machines, processes, and items of manufacture-are directed to patent-eligible subject matter within the meaning of 35 U.S.C. § 101 as interpreted by this Court? 64
- 65. Highmark Inc. v. Allcare Health Mgmt. Sys., Inc. • Federal Circuit held that a district court's objective baselessness determination is reviewed “without deference.” Federal Circuit denied rehearing en banc, 6-5. One of the two dissents observed that the decision below “deviates from precedent…and establishes a review standard for exceptional case findings in patent cases that is squarely at odds with the highly deferential review adopted by every regional circuit and the Supreme Court in other areas of law.” • Question Presented: Whether a district court's exceptional- case finding under 35 U.S.C. § 285, based on its judgment that a suit is objectively baseless, is entitled to deference. 65
- 66. Octane Fitness, LLC v. Icon Health & Fitness, Inc. • Federal Circuit held that district court appropriately applied the Brooks standard to find no exceptional case, even if Brooks required the district court to ignore relevant facts. • Question Presented: Whether the Federal Circuit’s rigid and exclusive two-part test for determining whether a case is “exceptional” under 35 U.S.C. § 285 improperly appropriates a district court’s discretionary authority to award attorney fees to prevailing accused infringers in contravention of statutory intent and the Court’s precedent, raising the standard for accused infringers (but not patentees) to recoup fees and encouraging patent plaintiffs to bring spurious patent cases to cause competitive harm or coerce unwarranted settlements from defendants 66
- 67. The Changing Federal Circuit
- 68. Then Active Judges in 2010: Michel Newman Mayer Lourie Rader Schall Bryson Gajarsa Linn Dyk Prost Moore 68
- 69. Now Michel Newman Mayer Lourie Rader Schall Bryson Gajarsa Linn Dyk Prost Moore 69 O’Malley Reyna Wallach Taranto Chen Hughes
- 70. The Near Future? Michel Newman Mayer Lourie Rader Schall Bryson Gajarsa Linn Dyk Prost Moore 70 O’Malley Reyna Wallach Taranto Chen Hughes ? ? ?