by Dennis Crouch
In recent years, the United States Patent and Trademark Office (USPTO) has undergone a significant shift in its examiner composition, with real implications for patent prosecution strategies.
Our data reveals a dramatic drop in the percentage of assistant examiners over the past decade. Prior to 2015, over 35% of patents were examined by assistant examiners. Since 2020, this number has plummeted to less than 20%. But these assistant examiners did not simply disappear. (more…)
by Dennis Crouch
Although not a patent case, Feliciano v. Department of Transportation merits attention as one of only two Federal Circuit cases granted certiorari for the October 2024 Supreme Court term, alongside the veterans benefits case of Bufkin v. McDonough.
In Feliciano, the Supreme Court will consider whether federal civilian employees who are called to active military duty are entitled to differential pay even if their service is not directly connected to a declared national emergency. The case stems from the Federal Circuit’s interpretation of the differential pay statute, 5 U.S.C. § 5538, which requires federal agencies to provide supplemental pay to federal employees called to active duty when their military salary is less than their civilian salary.
By Dennis Crouch
In Miller Mendel, Inc. v. City of Anna, Texas, No. 2022-1753 (Fed. Cir. July 18, 2024), the Federal Circuit affirmed a district court’s judgment on the pleadings that the asserted claims of Miller Mendel’s U.S. Patent No. 10,043,188 (‘188 patent) are ineligible for patent protection under 35 U.S.C. § 101. The court also affirmed the denial of the defendant’s motion for attorneys’ fees under 35 U.S.C. § 285.
In a recent decision out of the Southern District of Texas, Judge Lee Rosenthal found the patent infringement case brought by VDPP against Volkswagen to qualify for sanctions under the Patent Act 35 U.S.C. § 285. The court also relied upon 28 U.S.C. § 1927 and its inherent powers to directly sanction VDPP’s attorney William P. Ramey (Ramey LLP). VDPP, LLC v. Volkswagen Group of America, Inc., No. H-23-2961 (S.D. Tex. July 11, 2024).
by Dennis Crouch
Earlier this week I was reviewing some of the USPTO’s eligibility examples, noting that they were all quite old. As if on cue, the Office has released a new set of updated guidelines – focusing on Artificial Intelligence related inventions and including three new examples. In Bilski, the Supreme Court explained that the best way to understand whether a particular claimed invention is directed to an “abstract idea” is to look back on old examples for guidance. The USPTO has found that a good way to administer this approach is to provide examples of situations that pass or fail the test. Here, they introduce three new examples 47, 48, and 49. And, while the Alice/Mayo test for analyzing subject matter eligibility has not changed, the new guidance is helpful as AI technology rapidly develops. The USPTO continues to be open to issuing patents on AI inventions, including the use of AI. However, there must be a technical solution to a technical problem.
Although the guidance is effective July 17, 2024, the USPTO is open to comments via the regulations.gov portal. The agency has provided two updated flow charts for its analysis that are included below. Although the USPTO guidance is not binding law, it is the guidebook that examiners will be trained upon and required to use. As such, any patent attorney operating practicing in the AI area should dig through these examples and the particular cases chosen by the Office as representative. (more…)
by Dennis Crouch
In Backertop Licensing LLC v. Canary Connect, Inc., the Federal Circuit addressed the scope of a district court’s inherent authority to investigate potential litigation misconduct. Chief Judge Connolly of the District of Delaware had initiated an inquiry into dozens of patent infringement cases filed by plaintiff LLCs associated with IP Edge, a patent monetization firm, and Mavexar, an affiliated consulting shop. The district court was concerned that the real parties in interest may have been concealed, that fictitious patent assignments were filed with the USPTO to shield those parties from liability, and that the plaintiff LLCs’ attorneys may have violated the Rules of Professional Conduct by taking direction from Mavexar without their formal-clients’ informed consent. (more…)
by Dennis Crouch
In the recent case of Zimmer Biomet Holdings, Inc. v. Insall, No. 23-1888 (7th Cir. July 12, 2024), the Seventh Circuit affirmed an arbitration award requiring Zimmer to continue paying royalties to the estate of Dr. John Insall even after the expiration of the underlying patents. This decision highlights the significant deference afforded to arbitration agreements and the limited ability of courts to vacate arbitral awards, even when they conflict with Supreme Court precedent.
The key precedents underlying the dispute in Zimmer v. Insall are Brulotte v. Thys Co., 379 U.S. 29 (1964) and Kimble v. Marvel Entertainment, LLC, 576 U.S. 446 (2015). In Brulotte, the Supreme Court held that “a patentee’s use of a royalty agreement that projects beyond the expiration date of the patent is unlawful per se.” (more…)
by Dennis Crouch
The Supreme Court has requested a response to a pending petition for certiorari in United Therapeutics Corp. v. Liquidia Technologies, Inc., indicating that at least one justice sees potential merit in the case. The petition challenges the Federal Circuit’s application of the statutory limits on the Patent Trial and Appeal Board’s (PTAB) authority in inter partes review (IPR) proceedings. I believe that there is a potential that the Court will issue a grant-vacate-remand (GVR) order, asking the Federal Circuit to reconsider its deferential decision based upon Loper Bright.
UTC owns the patent at issue, U.S. Patent No. 10,716,793, which is directed to methods of treating pulmonary hypertension using treprostinil. (more…)
By Dennis Crouch
This case would be great for a 2L law review note.
Back in May 2024, the Federal Circuit issued an important decision holding that a patentee’s use of Amazon’s patent enforcement process (APEX) to target an alleged infringer’s listings can subject the patent owner to specific personal jurisdiction in the alleged infringer’s home state – despite no direct contacts with that state. SnapRays, LLC v. Lighting Defense Group, LLC, No. 2023-1184 (Fed. Cir. 2024). The patentee has now petitioned for en banc rehearing, arguing that the opinion conflicts with prior Federal Circuit precedent and makes a holding that the Supreme Court at least implicitly rejected in Walden. The case is important as APEX and other similar private sales-channel enforcement processes become increasingly popular. SnapRays En Banc Petition.
My view: The Federal Circuit erred here. (more…)
Guest post by Professors Mark A. Lemley and Lisa Larrimore Ouellette of Stanford Law School.
Two of the most controversial patent law changes of the past year have involved obviousness-type double patenting, which allows applicants to patent obvious variants of their earlier patents by disclaiming the extra term of the later-expiring patent. First, the Federal Circuit held in In re Cellect that patents tied by double patenting must expire on the same day even if one of the patents has received a patent term adjustment (PTA) giving it a more-than-twenty-year term. The en banc denial and pending cert petition in Cellect have attracted substantial interest from amici and commenters. Second, the USPTO proposed that terminal disclaimers include a commitment to not enforce the patent if any claims in the patent to which it is tied are found to be obvious or not novel. Early commentary on the proposal was “overwhelmingly negative.”
In our new draft article, Fixing Double Patenting, we argue that this outcry is unwarranted. (more…)
by Dennis Crouch
I recently provided a set of interesting data on the large number of patents that are “at risk” of being invalidated based on the Federal Circuit’s Cellect decision. This post follows up with a discussion of a recent article titled “Fixing Double Patenting” released in draft form by Stanford Professors Mark Lemley and Lisa Larrimore Ouellette. The article takes a critical look at the practice of obviousness-type double patenting in the U.S. patent system.
by Dennis Crouch
Many have been thinking of the potentially large impact of Cellect v. Vidal, which is now pending before the Supreme Court. This week I uncovered striking data that a very large number of patents have been impacted.
Some background: (more…)
by Dennis Crouch
The Federal Circuit’s practice of issuing no-opinion affirmances under Rule 36 is facing renewed scrutiny in two recent petitions for rehearing en banc. In UNM Rainforest Innovations v. ZyXEL Communications Corp. and Island Intellectual Property LLC v. TD Ameritrade, Inc., the petitioners argue that the court’s use of one-word Rule 36 judgments allowed it to sidestep key legal and factual issues raised on appeal. These petitions highlight ongoing concerns about the Federal Circuit’s frequent use of Rule 36 and its impact on patent law development. The failure to provide an explanatory opinion is an appellate-procedure issue – the two patentees also argue that the lower tribunal made substantive legal errors.
I don’t see the court as having a truly nefarious reason for its common no-opinion judgments, but the situation does call to mind the ancient fable about the emperor’s new clothes adapted and popularized by Hans Christian Andersen. (more…)
by Dennis Crouch
This is just a first look at how overturning Chevron may impact patent practice.
In the past, both the USPTO and patent attorneys have largely ignored the larger scope of administrative law, but in recent years USPTO operations have been under tighter control from the White House, and courts have increasingly asked whether the agency is following the rules. Administrative patent law was truly launched with the American Invents Act of 2011 and the resulting administrative patent trials by the PTAB — resulting in hundreds of appeals arguing that the USPTO’s procedural approach is an abuse of administrative power. Importantly, the Supreme Court in Cuozzo Speed Techs. v. Com. for Intell. Prop., 579 U.S. 261 (2016) provided the patent office with Chevron deference for its determinations regarding AIA trials, including issues such as its approach to claim construction. But Chevron has now been overruled, and many are wanting the Federal Circuit to revisit the USPTO approach.
Although I expect that the outcome (more…)
As the Supreme Court’s 2023 year draws to a close, the court has denied certiorari in the vast majority of IP related cases, with the Dewberry trademark damages case left as the only IP case granted certiorari. Seven petitions remain undecided and the court will pick them up again when it begins the 2024 term in late September. This post briefly reviews these cases. I’m listing some cases that I have not previously discussed first.
I. United Therapeutics Corporation v. Liquidia Technologies, Inc. (Case No. 23-1298)
This case centers on the Federal Circuit’s role in overseeing inter partes review proceedings. Petitioner is challenging the standard of review applied by the Federal Circuit when examining the Patent and Trademark Office’s (PTO) decisions in IPR cases. Paraphrased issues:
On the second question, the court is currently considering a Chevron case and is likely to significantly change the doctrine within the next few days.
II. Bill Gaede, et ux. v. Michael Delay, et al. (Case No. 23-1252)
This is a bit of an odd case raising the concept of “scientific priority,” which I believe is really a right of attribution: Can the usurpation of scientific priority be considered a violation under the Lanham Act or the Copyright Act?
The Gaedes claimed that the defendants (Michael Delay, Anastasia Bendebury, and Biospintronics, LLC) had misappropriated their ideas and theories, attempting to assert copyright protection over these ideas and alleging unfair competition under the Lanham Act. Specifically, the Gaedes contended that Bill Gaede was the originator of certain theories and ideas, and that the defendants were wrongfully presenting these ideas as their own in services they sell on the internet.
The Ninth Circuit affirmed the lower court’s dismissal; holding that the Gaedes were trying to protect ideas, which are not copyrightable and that the unfair competition claim was not viable based on the Supreme Court’s interpretation in Dastar Corp. v. Twentieth Century Fox Film Corp.
III. Kirk Johnston v. Nickleback (Case No. 23-1243)
Petitioner, Kirk Johnston allegedly wrote the song “Rock Star” and is suing Nickelback band members for copyright infringement based upon its own rock star song. The district court dismissed the case on summary judgment, writing that both songs include lots of tropes about famous musicians but that the two songs “do not sound alike.” In his petition, Johnston argues that the lower court improperly decided the facts on summary judgment:
1. Can courts disregard expert evidence on substantial similarity at the summary judgment stage?
2. Should courts make factual determinations on access and substantial similarity at the summary judgment stage, potentially denying plaintiffs their right to a jury trial?
3. How should courts handle the “discovery rule” in copyright cases, particularly regarding the scope of available damages?
Johnston is pro se in this case.
IV. Cellect, LLC v. Vidal (Case No. 23-1231)
I’ve previously written about this case which focuses the interplay between statutory provisions and old judge-made doctrines in patent law. Specifically, the case asks whether a patent procured in good faith can be invalidated for obviousness-type double patenting when family member patents have varying expiry dates due to Patent Term Adjustment (PTA) caused by USPTO delays in granting patent rights.
V. Chestek PLLC v. Vidal (Case No. 23-1217)
This is an administrative law case asking when the APA requires the PTO to conduct formal rulemaking. Is the PTO exempt from notice-and-comment requirements when exercising its rulemaking power under 35 U.S.C. § 2(b)(2)?
VI. Eolas Technologies v. Amazon.com, Inc., et al. (Case No. 23-1184)
This case, also involving accused infringers Google and Walmart focuses on patent eligibility.
The patent at issue (9,195,507) includes aspects of the internet that many see as fundamental — perhaps it claims priority back to 1994.
VII. Tarun Surti v. Fleet Engineers, Inc. (Case No. 23-1142)
This case raises several issues related to patent infringement litigation, particularly focusing on the rights of individual inventors and small entities. The petitioner, a pro se individual inventor, is challenging various aspects of the lower courts’ handling of his patent infringement case, including application of the doctrine of equivalents; proper remedies for patent infringement, and tortious interference in the context of patent disputes.
by Dennis Crouch
The Federal Circuit recently denied a petition for mandamus seeking to overturn a district court order transferring a patent case from the Western District of Texas to the Northern District of California. In re Haptic, Inc., No. 2024-121 (Fed. Cir. June 25, 2024). This case was filed in Austin and assigned to Judge Robert Pittman with Haptic alleging that Apple’s “Back Tap” feature on iPhones infringes U.S. Patent No. 9,996,738 relating to gesture detection systems. Haptic is headquartered in Austin at the home of its longtime CEO and listed inventor Jake Boshernitzan. The company was part of Techstars Austin Accelerator as it developed its product known as Knocki that allows users to tap on ordinary surfaces to control various actions on phones and other devices. Knock on wood. The patent and Knocki product are designed to expand touch interfaces beyond traditional touchscreens, potentially opening up new modes of interaction with smart devices and appliances. The ‘738 patent particularly issue covers systems and methods for detecting tapping or knocking gestures on surfaces to control electronic devices.
Apple also has a major presence in Austin, with about 10,000 Austin employees and a billion-dollar second headquarters campus in the city. Nevertheless, Judge Pitman (more…)
by Dennis Crouch
Amarin Pharma, Inc. v. Hikma Pharmaceuticals USA Inc., No. 2023-1169 (Fed. Cir. June 25, 2024).
This is another “skinny label” generic pharmaceutical patent case. The basic setup involves a drug that has several different approved uses; with the branded manufacturer holding patents covering only some of the uses. The generic company is then permitted to sell the drug, but is labelled only for non-patented uses. These labels are known as carve-out or “skinny” labels under 21 U.S.C. § 355(j)(2)(A)(viii).
It is inevitable that people will purchase and use the generic drugs for the patented uses, and that the generic distributer will be accused accused of inducing those infringing acts. Although the generic typically makes a profit on these sales, it those profits pale in comparison to the profits lost by the branded company.
Amarin v. Hickma highlights some of the challenges that generics are facing when marketing drugs with these carved-out labels. One difficulty is that the FDA severely limits what the generic can say about the drug and its uses, and the carve-out is generally based upon statements made by the patentee. Here, the court follows a label-plus approach. The skinny label itself will not be enough to show inducement, but that evidence can be combined with other evidence (such as marketing) to prove liability. (more…)
by Dennis Crouch
The U.S. Supreme Court has granted certiorari in Dewberry Group, Inc. v. Dewberry Engineers Inc., a trademark damages case focused on how corporate separateness principles apply to disgorgement remedies under the Lanham Act, 15 U.S.C. § 1117(a). The Fourth Circuit’s decision affirmed a $43 million disgorgement award against petitioner Dewberry Group (DG) for trademark infringement, an amount that included profits earned by DG’s “legally separate” corporate affiliates. Apparently, the affiliates were “single-purpose entities,” also privately owned by John Dewberry, whose sole function was to own commercial properties serviced by DG.
Pierce the Veil: In its literal sense, a veil is a delicate fabric that separates the visible from the concealed, a barrier that can be easily lifted or parted. However, the phrase has a history of extending beyond the material world, with a veil often serving as a boundary between the physical and spiritual realms in our universe. Many of us go through life, only occasionally glimpsing beyond this veil into the hidden spiritual dimensions that, according to story tellers, lie alongside our own. In the corporate world, the veil of corporate personhood serves to shield the owners from personal liability, creating a legal fiction that separates the actions of the company from those of its shareholders. This veil of protection is not impenetrable, however, and can be pierced by the courts in cases of serious misconduct or wrongdoing, exposing the owners to personal responsibility. Although the truth of owner identity may already be known, piercing the corporate veil removes the protection against responsibility by attempting to holding accountable those who would misuse its protections. But, the legal doctrine of corporate separateness is quite strong and I might venture that it is easier to pierce the veil of our spiritual realms than the corporate analogue. (more…)
by Dennis Crouch
The Federal Circuit’s 2023 decision in Axonics, Inc. v. Medtronic, Inc. marked an important change in inter partes review procedure, ensuring petitioners have an opportunity to respond patentee’s newly proposed arguments, with the hope of discouraging patent owners from holding-back (“sandbagging”) at the institution stage. Case-in-point is the Federal Circuit’s recent Apple v. Omni MedSci decision authored by Judge Alan D. Albright sitting by designation.
