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09.16.18

Slamming Courts and Judges Won’t Help the Patent Maximalists; It Can Only Make Things Worse

Posted in America, Deception, Patents at 5:47 am by Dr. Roy Schestowitz

Recent: Patent Maximalists — Not Reformers — Are the Biggest Threat to the Viability of the Patent System and Innovation

Green puzzle

Summary: Acorda Therapeutics sees its stock price dropping 25% after finding out that its patent portfolio isn’t solid, as affirmed by the Federal Circuit (CAFC); the only way out of this mess is a pursuit of a vastly improved patent quality, thorough patent examination which then offers legal certainty

THE EPO grants monopolies that kill people, just like the USPTO. It’s like corporate interests rather than science or innovation are the sole priority. What about public interest? Or public welfare/wellbeing?

The other day patent maximalists wrote about Acorda. Dennis Crouch (Patently-O) keeps sobbing for the patent aggressors, even if the patents at hand (underlying USPTO-granted monopolies) turn out to have been errors, hence injustices. To quote Crouch:

In a 50+ page majority opinion, the Federal Circuit has affirmed a district court obviousness judgment. Judge Taranto penned the majority opinion and was joined by Judge Dyk. Judge Newman wrote in dissent — arguing in 20+ additional pages that the majority improperly discounted the objective indicia of non-obviousness. On news of the invalidity decision, Acorda’s stock price dropped 25%.

[...]

Remember that broad Elan patent exclusively licensed by Acorda. The majority explains that Acorda’s commercial success and the long-felt need for advances were due to the roadblock set-up by that patent. “The risk of infringement liability for marketing in the US would have provided and independent incentive [for third parties] not to develop the invention of the Acorda patents, even if those inventions were obvious.” (internal quotations eliminated; this holding, the appellate court finds was supported by the trial record). Although the Elan patent was a US patent — and thus did not block research (FDA Research Exemption) nor did it block international sales, the majority explained that those caveats are “not shown to be weighty.” Several Amici filed briefs in support of the patentee — however, the Federal Circuit found that the friendly arguments failed for lack of proffered evidence.

If a company is this dependent on a patent monopoly, then perhaps it should not exist in the first place and the patents are of rubbish quality anyway. Something similar happened in Europe recently.

It’s not too surprising that similar ‘sob stories’ came from proponents of patents on life/nature such as “Patent Docs authors Kevin Noonan and Donald Zuhn,” as Patent Docs themselves put it shortly after Kevin Noonan wrote about Acorda:

Determining obviousness is always a reconstruction, imperfectly done, of a past that never was. The prior art is consulted and the question asked, would the worker of ordinary skill in the art have been able to achieve the claimed invention with a reasonable expectation of success? Of course, this question is posed against a backdrop of the ordinarily skilled worker not having achieved the invention; that accomplishment was attained by the named inventor. Nevertheless, the Supreme Court since Hotchkiss and the Patent Act since 1952 has recognized that sometimes the answer to the question must be no, if only to ensure that the constitutional mandate that Congress only grant patents that will “promote the progress of . . . the useful arts” be satisfied.

[...]

The lawsuit arose when Roxane and co-Defendants Mylan Pharmaceuticals, Inc., and Teva Pharmaceuticals USA, Inc. each filed an Abbreviated New Drug Application (ANDA) for Acorda’s multiple sclerosis drug (Ampyra®) and sent Paragraph IV letters to Acorda (and co-Plaintiff Alkermes Pharma Ireland Ltd.) asserting that four Orange Book-listed patents (U.S. Patent Nos. 8,007,826; 8,663,685; 8,354,437; and 8,440,703) were invalid. As the Federal Circuit panel stated, there was one additional patent, U.S. Patent No. 5,540,938, owned by Elan Corp. plc and exclusively licensed to Acorda. That patent broadly claimed therapeutic formulations of 4-aminopyridine (4-AP); Acorda’s patents were for more narrow formulations having specific characteristics and properties that distinguished (undisputedly, for novelty purposes) these claims from the claims of the ’938 patent.

None of that would happen had the USPTO properly assessed the patents in the first place, possibly aided by the Patent Trial and Appeal Board (PTAB), even without an inter partes review (IPR). What we generally have here for all to see is a reminder of the great importance of patent quality.

The US patent courts, CAFC in this case, keep telling off the U.S. Patent and Trademark Office (USPTO) for granting bogus patents and trying to justify that, as is common when it comes to 35 U.S.C. § 101. Here is another new example from Patently-O:

Today the Federal Circuit issued three parallel decisions all stemming from the patent case brought by Asghari-Kamrani. The first two decisions affirm the E.D.Va. judgment-on-the-pleadings. In those cases, the district court held that the patentee (Asghari-Kamrani) failed to state a plausible claim for relief within her complaint. In particular, the court found that all the asserted claims were invalid for lack of eligibility. On appeal, the Federal Circuit AFFIRMED in a R.36 Judgment Without Opinion. [Link].

The third decision is an order of dismissal of a parallel appeal from the PTAB (CBM Review). The PTAB had found all of the claims unpatentable as obvious or anticipated. On appeal, though the Federal Circuit dismissed the appeals as moot — and vacated the USPTO decisions.

Dennis Crouch, in his rather typical fashion, complains about it. This patent maximalist says “the automatic vacatur of the PTAB decisions does not sit well with me.” He has long used this strategy of trying to slow PTAB down, just like the SAS decision from earlier this year.

Crouch later wrote another one of his many rants, this time titled “The Federal Circuit Strides Forward with No-Opinion-Judgments” (never mind if they cannot cope with the number of appeals coming from PTAB). To quote Crouch:

Petition for Writ of Certiorari. I explain in the article, that the issue was rather low-level up until 2013 and the explosion of inter partes review (IPR) proceedings and resulting appeals to the Federal Circuit. Because those cases typically involve complex obviousness analysis (as in the case at hand), the shortcut route has been for the court to issue R.36 Judgments Without Opinion in these IPR appeals. The result has been hundreds of R. 36 Judgments of PATO appeals over the past few years.

Although a number of parties have raised the issue with the Federal Circuit, the court has not yet addressed the issue directly (other than by continuing to issue no-opinion-judgments). I will note that the same question is also presented in the pending petition in Leon Stambler v. Mastercard International, Inc., SCT Docket No. 17-1140.

Rob Sterne’s team at Sterne Kessler is representing the patentee-petitioner. Sarah Guske (Baker Botts) represented Cisco in the appeal.

If Crouch is so bothered to see patents invalidated at a very high pace, maybe he should introspect and consider if his worldview has been warped by the litigation ‘industry’ with its financial agenda. He’s supposed to be a law professor, but instead he speaks like a lobbyist for patent trolls who just ‘happens’ to lecture people in an educational institution.

Observations like the above only further contribute to the perception of a nefarious agenda; and as a side note, many patent sites I’ve long followed (they’re even called “Patent” something) are diverging/moving away from patents to copyright and trademark stuff. Some, including Watchtroll, no longer even cover any of the above. They seem totally lost. When they write something — as we shall show later this weekend — it’s typically an attack on a court, tribunal, panel, or judge. This is not good. It’s not good for the image of their profession as a whole. Unless they give up on their patent maximalism/lobbying, they will only alienate judges even further. Moving to greener pastures may be a better trajectory. IAM, for example, has virtually gone dark; it’s barely even visible anymore.

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