Finding balance between restrictions and collectively-beneficial liberalism
“The copyright laws attempt to strike a balance between protecting original works and stifling further creativity.” Bridgeport Music, Inc. v Dimension Films, opinion of the court (2004)
Summary: As the US Supreme Court (SCOTUS) starts delivering some decisions we take stock of what’s to come regarding patents
AS EXPECTED, the Justices at SCOTUS bring forth some new output for law firms to comb through before analyses/interpretations get published by the hundreds/thousands. First there was today’s decision on uniform copyrights (just covered in our latest daily links, under the copyright section, with three reports we’ve found within hours).
“To summarise, in the area of copyright the Justices sidle with the maximalisms, whereas in the area of patents it’s not quite as depressing.”Professor Crouch took note of the Lexmark case, which is still ongoing (orally). To quote a portion: “Truthfully, most of the oral arguments involve Justice Breyer explaining to other members of the court that Lexmark’s approach violate’s Lord Coke’s 300 year old maxims – “that’s been the kind of basic legal principle for an awfully long time.” Lexmark’s primary answer: “the common law changed a lot after Lord Coke.” In the two most recent IP Decisions by the Court – Star Athletica and SCA Hygiene – the majority ruled in favor of the IP rights-holder over Justice Breyer dissents in both cases.”
We’ve already covered this case before. MIP, in the mean time, takes note of the laches defence, writing this afternoon that “The Supreme Court rejected wholesale the Federal Circuit’s stance that laches be an available defence in patent law, in its SCA Hygiene v First Quality ruling” (we wrote about this last night).
“We certainly hope that in the coming days, weeks and months the Justices will recognise that for patent law to be respected and be seen as legitimate it needs to adhere to public interests and be limited to what is reasonable.”To summarise, in the area of copyright the Justices sidle with the copyright maximalisms, whereas in the area of patents it’s not quite as depressing. The likes of IAM and Watchtroll will no doubt write about that soon; IAM has just published this rant from a law firm, asserting that “Patent Trial and Appeal Board, state anti-troll laws and anti-patent Supreme Court and Federal Circuit decisions have eroded patent protection.”
No, these have improved patent quality — something we should all celebrate unless we make money by peddling patent feuds. We certainly hope that in the coming days, weeks and months the Justices will recognise that for patent law to be respected and be seen as legitimate it needs to adhere to public interests and be limited to what is reasonable. This means, among other things, that the ruling on TC Heartland (last update a couple of days ago) should be made against patent trolls infesting the Eastern District of Texas. █
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Insulting Justices/judges, like hitting them under the belt
Justice Breyer was pro-Alice or in favour of what’s now known as the Alice test that eliminates many software patents
Summary: The US Supreme Court (SCOTUS) is preparing to deliver some important decisions on cases with broad ramifications, e.g. for patent scope, and those who make money from patent feuds are attempting to alter the outcome (which would likely restrict patent scope even further, based on these Justices’ track record)
SOME of our earliest articles about SCOTUS were quite critical of it; the same goes for the USPTO. But nearly a decade has passed and the United States is nicely reforming the patent system, led by key decisions from SCOTUS (decisions such as Alice and Mayo).
“…nearly a decade has passed and the United States is nicely reforming the patent system, led by key decisions from SCOTUS (decisions such as Alice and Mayo).”There are some important and relevant (to us) cases coming from SCOTUS, possibly with new Justices joining quite soon (following the death of Scalia and the change of political party in power). A loosely-closeted patent maximalist (disguised as academic) seemed rather bothered about the upcoming decisions. He wrote a lot about them recently, noting for instance that “Justice Breyer dissented – arguing that “for more than a century courts with virtual unanimity have applied laches in patent damages cases” in order to fill an important gap in the statutory regime.” (regarding SCA Hygiene Prods. v First Quality Baby Prods)
He also wrote regarding the Lexmark case which we recently wrote about in light of the attacks on Justice Breyer. The patent maximalist quotes from this SCOTUS oral arguments
[PDF]: “If you look it the Alice case, for example, that obviously had tremendous implications…”
“There are some important and relevant (to us) cases coming from SCOTUS, possibly with new Justices joining quite soon (following the death of Scalia and the change of political party in power).”Yes, fantastic implications to software developers, albeit negative for patent trolls, patent lawyers etc. (in other words, people who produce nothing of use)
SCOTUS will likely rule for common sense yet again, as it so persistently did in the patents domain (the composition of Justices is still very similar). Here is Watchtroll attempting to influence the outcome by giving the platform to “an associate in Womble Carlyle’s Intellectual Property Transactions Group.” (i.e. patent microcosm).
No doubt there will be a lot of lobbying to that effect in the coming days, weeks, and beyond.
A great headline that we found earlier today said, “In Apple v. Samsung, SCOTUS Sided With Reason Over Rounded Corners”
“No doubt there will be a lot of lobbying to that effect in the coming days, weeks, and beyond.”There may be more such decisions (regarding Apple and Samsung) heading into SCOTUS, with nearly billions of dollars hanging in the balance (for this case alone, irrespective of impact it would have on other, future cases). To quote the article: “After almost five years of legal volleying, the U.S. Supreme Court finally issued a decision in the highly anticipated Apple v. Samsung design patent case late last year. On Tuesday, Dec. 5, the court delivered a unanimous decision in favor of Samsung, finding that damages for design patent infringement may be limited to revenues attributable to a component of an article of manufacture rather than profits from the entire article. While this is an important victory for startups and innovators—from global corporations to inventors toiling in garages—courts must still work to provide the guidance and clarity necessary to prevent bad actors from abusing the patent system to the detriment of innovation. And they have a new opportunity to do so: On Feb. 7, the U.S. Court of Appeals for the Federal Circuit took a significant step in that direction by remanding the Apple v. Samsung case to the Northern District of California court.”
We have been trying to figure out where a Justice Gorsuch (if appointed, not just nominated) would stand on patents, but it’s still too much of a mystery [1, 2]. We have not yet seen any indication — except perhaps this — that Trump is going change course and attempt to reverse/undo the progress made. █
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Summary: An outline of the latest news from the Court of Appeals for the Federal Circuit (CAFC), the Eastern District of Texas (EDTX), and proponents of software patents, who are growing ever more desperate in the wake of Alice
THE death of software patents (in the US) is habitually and even casually being denied by those who have made a lot of money from them, notably law firms.
Clearly, in the patent microcosm’s press (like Texas Lawyer in this case), the term “most popular” means popular among trolls and lawyers. Watch this new article titled “EDTX’s Rodney Gilstrap Is Still America’s Most Popular Patent Judge” (EDTX is the Eastern District of Texas).
“Clearly, in the patent microcosm’s press (like Texas Lawyer in this case), the term “most popular” means popular among trolls and lawyers.”The article as a whole is behind a paywall, but the summary states: “While patent infringement filings are down both nationally and in Texas according to a recent report, there’s still no question who the King of America’s patent docket is: U.S. District Judge Rodney Gilstrap of Marshall.”
King of the trolls maybe, now that the father of patent trolling is dead. The Eastern District of Texas and Judge Gilstrap are a farce; as we pointed out a few days ago, the Supreme Court should act fast against both, essentially by moving cases out of this “rocket docket” of patent trolls, starving the demand for kangaroo patent courts.
Writing about the latest twist in the Smartflash case, a site that promotes software patents mentioned how the Eastern District of Texas was once again overruled by CAFC. To quote:
The Federal Circuit has reversed Eastern District of Texas Judge Gilstrap’s denial of a post-trial motion for a judgment of patent-ineligibility under 35 U.S.C. § 101 of three patents directed to accessing and storing payment data. Smartflash, LLC v. Apple, Inc., No. 2016-1059 (Fed. Cir . March 1, 2017). Chief Judge Prost, writing for a panel that included Judges Newman and Lourie, saved Apple from a jury verdict that claims of U.S. Patent Nos. 7,334,720; 8,118,221; and 8,336,772 were valid and infringed.
The patent microcosm, including the above site, continues to bemoan the death of yet more software patents. Here is one of the latest examples, “Data Back-Up Claims Held Patent-Ineligible under Alice,” and to quote:
As a plethora of cases demonstrates, no matter how separate the patent-eligibility is from the question of prior art in practice, the reality is that the analyses go hand-in-hand. So when drafting patent applications think hard about whether you can state a technical solution to a technical problem. And if you can state a technical problem and solution, do it, as clearly as you can.
A District Court meanwhile throws away yet more software patents that have nothing innovative in them. Why did the USPTO grant these in the first place? Watchtroll says that the defendant “argued that both of TAGI’s patents are directed at unpatentable subject matter under 35 U.S.C. Section 101. In response, the court applied the now familiar two-step standard Alice/Mayo test for distinguishing patents claiming abstract ideas and laws of nature.”
“…Alice is here to stay and the Supreme Court has taken no other case that can reverse Alice.”As usual, they ruled against these patents, as they do in the significant majority of the cases (most of the time) nowadays. Watchtroll, as expected, continues to moan about death of so many software patents (calling the software “revolutionary”), but maybe these people should just move on and get another (real) job, not lobbying for software patents and fooling developers into pursuing patents that are a waste of money.
The funniest headline we have come across? A clickbait headline from boosters software patents, asking “Goodbye Alice?”
Haha, that’s a good one. No, Alice is here to stay and the Supreme Court has taken no other case that can reverse Alice. Here is what the article says, citing front group IPO (which has this new IBM-led campaign to shoot down Alice):
A recent proposal by the Intellectual Property Owners Association (IPO) to amend 35 U.S.C. § 101 could bring positive change to applicants attempting to acquire patent rights for computer implemented inventions in the US.
The proposal comes after court decisions such as Alice Corp Pty v CLS Bank Int’l (2012) (Alice Corp) blurred the lines between patentability and obviousness, requiring an assessment of the “inventive concept” to be performed when evaluating subject matter eligibility of an application, and resulting in a significant number of computer-related inventions being found invalid for lack of patentable subject matter.
What’s wrong with that? It’s about time. Ask actual software developers if they ever wanted software patents to begin with. They never did. Now that software patents are ebbing away so do patent trolls, which the Supreme Court might soon throw out of the Eastern District of Texas.
“Now that software patents are ebbing away so do patent trolls, which the Supreme Court might soon throw out of the Eastern District of Texas.”Recently, the “Federal Circuit ruled that companies who receive patent demand letters from trolls can’t sue them in their home district,” Daniel Nazer wrote for the EFF. One must remember the close correlation between software patents, patent trolls, and the Eastern District of Texas. If even the lower courts sometimes deny the Eastern District of Texas access to everyone’s alleged grievances, then we might not even have to wait until TC Heartland. However, to quote Nazer, the Federal Circuit has not exactly been consistent, at least not yet (consistency will likely come after the Supreme Court issues a ruling on TC Heartland, some time later this year):
If a patent troll threatens your company, can you go to your nearest federal court and ask for a ruling that the patent is invalid or that you aren’t infringing it? According to the Federal Circuit (the court that hears all patent appeals), the answer to this question is usually no. The court has a special rule for patent owners that demand letters cannot create jurisdiction. EFF, together with Public Knowledge, recently filed a friend-of-the-court brief asking for this rule to be overturned. But in a decision this week, the Federal Circuit reached the right result for the accused infringer in the case, but left its bad law largely in place.
Second, in a case called Red Wing Shoe, the Federal Circuit ruled that companies who receive patent demand letters from trolls can’t sue them in their home district to get a determination the patent is invalid or not-infringed. As others have noted, the Federal Circuit has “gone to great lengths to deny jurisdiction over patentees sending demand letters from afar.”
We eagerly await the decision on TC Heartland, we very much welcome CAFC decisions in favour of PTAB findings (a topic to be covered in our next post), we need to guard PTAB from the patent microcosm, and last but not least ensure Michelle Lee keeps her job in spite of a vicious witch-hunt against her [1, 2, 3, 4]. █
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How long and how much more will it take for the Supreme Court to realise there is a profound issue in Texas?
Summary: The lack of justice in the American patent system, where trolls receive favourable treatment from particular judges and one bogus patent (now invalid) can earn a person over $45 million in ‘protection’ money, necessitates firm and decisive intervention from the US Supreme Court
Federal Circuit Once Again Overrules Mistakes by the Kangaroo Patent Court of Rodney Gilstrap in the Eastern District of Texas
Kangaroo courts are not monopolised by the EPO and the USPTO hasn’t a monopoly on bad patents, either (thankfully, the USPTO is actually improving and lowering the incentive for trolls). The US Supreme Court, together with CAFC below it, already do a fine job, further aided by PTAB (the appeals board) for quicker and cheaper determinations against bad patents.
When Apple celebrates the death of bad patents we too are happy, even if we are far from friends of Apple (we used to call for boycotts). Apple has just defeated Smartflash and there are a lot of articles about this, especially or initially in pro-Apple sites. Headlines include “Apple has $533m verdict against iTunes software patents thrown”, “Apple won’t have to pay $533 million to an iTunes patent troll”, “U.S. appeals court tosses patent verdict against Apple”, and “Apple tastes victory against Smartflash at Federal Circuit”.
“When Apple celebrates the death of bad patents we too are happy, even if we are far from friends of Apple (we used to call for boycotts).”“This ruling isn’t surprising,” one of the above articles states, “as US District Judge Rodney Gilstrap ordered a damages retrial, saying the jury’s view of Apple’s infringement might have been confused by his instructions on how properly to calculate royalties.”
But the pro-trolls Judge Rodney Gilstrap did not in fact dispute a liability. To him, it was just a matter of how much money would be paid. First to cover the news, as far as we were able to see, was Michael Loney of MIP. He wrote about it as early as yesterday, noting that CAFC had found yet another ruling from the notorious Eastern District of Texas to be bunk. “The Federal Circuit has found invalid three Smartflash patents,” he wrote, “reversing the Eastern District of Texas.”
Eolas Driven Out of the Eastern District of Texas
There is another important development down in Texas and Joe Mullin probably wrote the best report about it (Mullin is quite the expert in this domain). To quote Mullin:
Eolas Technologies, which has been called a “patent troll,” has continued to file against big companies, even after losing a landmark 2012 trial. But following an appeals court order (PDF) last week, Eolas will have to pursue its lawsuits in California—not its preferred patent hotspot of East Texas.
As of Friday, Eolas’ lawsuits against Google has been transferred to the Northern District of California. The move could reduce Eolas’ chances of winning a settlement or verdict since East Texas courts have been viewed by some as favoring patent holders. Similar lawsuits against Amazon and Wal-Mart remain in East Texas, for now.
Michael Loney wrote about it too, noting that CAFC is potentially moving trolls out of that notorious Eastern District of Texas (even before the Supreme Court rules on TC Heartland LLC v Kraft Foods Group Brands LLC). To quote:
Google’s request for a writ of mandamus to transfer a case brought by Eolas Technologies to the Northern District of California from the Eastern District of Texas has been granted, with the Federal Circuit citing “a clear abuse of discretion”
Eolas was mentioned here as far back as one decade ago and many more times since. It’s definitely a patent troll, but Mullin put the word “troll” (in the headline) and “patent troll” (in the body) within scare quotes, perhaps fearing legal action against the publisher (his employer).
Software patents, as in the above case, are bunk, but it’s very expensive (usually too expensive) going to court to show it (especially if there are appeals). This means that most defendants will silently fold and pay the Mafia (or troll) ‘protection’ money. Insistent and persistent aggressors or trolls, some of whom are well-funded, will just file more and more motions until the defendant — even if repeatedly deemed innocent — decides that it’s simply cheaper to settle. It means that wealth trumps justice and it can be exploited time after time, by simply choosing vulnerable litigation targets which are almost certainly going to buckle.
“Software patents, as in the above case, are bunk, but it’s very expensive (usually too expensive) going to court to show it (especially if there are appeals).”Speaking of software patents, this tweet says that “Salesforce tries to patent Records Management……quick take” (in an image).
Erich Spangenberg Turns Out to be a Patent ‘Fraud’
In the above cases we see deep-pocketed companies like Google and Apple fighting back, again and again, simply because they can afford it. So can smaller (but still very large companies) such as Newegg, which already spent millions of dollars on very few patent cases — and that’s just in legal fees!
According to Mullin’s other new report, mega-troll Erich Spangenberg went after Newegg and finally (belatedly) lost. That’s another software patent dead and we can expect more to come; it’s expensive to prove the invalidity. The USPTO should clean up this (its own) mess. PTAB helps towards that. Mullin wrote:
Patent-holding company TQP Development made millions claiming that it owned a breakthrough in Web encryption, even though most encryption experts had never heard of the company until it started a massive campaign of lawsuits. Yesterday, the company’s litigation campaign was brought to an end when a panel of appeals judges refused (PDF) to give TQP a second chance to collect on a jury verdict against Newegg.
The TQP patent was invented by Michael Jones, whose company Telequip briefly sold a kind of encrypted modem. The company sold about 30 models before the modem business went bust. Famed patent enforcer Erich Spangenberg bought the TQP patent in 2008 and began filing lawsuits, saying that the Jones patent actually entitled him to royalties on a basic form of SSL Internet encryption. Spangenberg and Jones ultimately made more than $45 million from the patent.
Will Spangenberg now refund the extortion money (more than $45 million), plus legal expenses? Or will this be another case of an invalid patent costing a fortune to countless companies, even though they were innocent all along because this patent was bogus?
We certainly hope that the Supreme Court is watching all these cases and will take them into account later this year when TC Heartland can become the new “patent killer” (precedent). █
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GNU/Linux-powered devices are habitually being targeted by artsy design patents, but might this end soon?
Summary: A company which often takes pride in designers rather than developers (art, not technical merit) may lose that leverage over the competition if its questionable patents are taken away by the Supremes
THE SCOTUS, in its current composition at least (many nominations and appointments by Democrats — a trend that is now changing), has handed down some important decisions on patents over the past half a decade and most of them were favourable to patent reformers. Reformist scope-oriented measures such as restriction if not elimination of software patents are just the tip of the iceberg; a few months ago we wrote about the Lexmark case.
“This time around it’s about the second California Apple v. Samsung case (the one that went to trial in 2014, resulting in a $119 million verdict).”
–Florian MüllerFlorian Müller scooped an important story the other day. “I tried to find media reports on Samsung’s new Apple v. Samsung Supreme Court petition,” he wrote, “and couldn’t find any, so maybe I scooped’em all” with the blog post “Samsung is now taking the second Apple v. Samsung patent case to the Supreme Court”. To quote: “The first Apple v. Samsung case went all the way up to the Supreme Court and has meanwhile gone all the way back to the Northern District of California to take a new look at the question of design patent damages. But the steps to the Supreme Court are like a revolving door for this huge commercial dispute: a new petition for writ of certiorari (request for Supreme Court review) is already in the making! This time around it’s about the second California Apple v. Samsung case (the one that went to trial in 2014, resulting in a $119 million verdict).”
Someone disputed the number, saying that “it’ll actually be the third. They had another petition denied on a very technical issue.”
Müller insisted, however, that “by “second case” I meant the second case filed by Apple against Samsung in U.S. district court…”
“If this is all that Apple has left in its future plans (suing competitors), then it doesn’t look particularly bright; nor does it look innovative…”Techrights had been sceptical of Apple for a long time, even before Apple began attacking Android with patents (there was sabre-rattling even before that, e.g. against Palm). Apple and its nonsensical patents never end. Our sources at the EPO indicate that it’s not different in Europe, but we cannot publicly share any further details on that (in order to protect sources). Watch this article from CNN, published just 6 days ago. “Apple often patents interesting hardware or futuristic iPhone designs that may never see the light of day,” it says. “But in its latest patent granted on Tuesday, Apple (AAPL, Tech30) describes something a little less innovative, and already wildly popular.”
They’re ignoring prior art and also neglecting the fact that software patents are a dying breed. If this is all that Apple has left in its future plans (suing competitors), then it doesn’t look particularly bright; nor does it look innovative…
We look forward to that (potentially second) SCOTUS case which might, due to Apple, spell doom for design patents, which are often similar to software patents (in the GUI sense).
Life Technologies Corp. v Promega Corp.
“We look forward to that (potentially second) SCOTUS case which might, due to Apple, spell doom for design patents, which are often similar to software patents (in the GUI sense).”SCOTUS rulings on patents actually made a lot of headlines this past week, but this did not involve software patents or anything like that. Mayer Brown LLP, for example, wrote about Life Technologies Corp. v Promega Corp. (at SCOTUS) in lawyers’ media. “In an effort to curb efforts to circumvent patent protection,” they said, “the Patent Act imposes liability for infringement on anyone who supplies “all or a substantial portion” of a patented invention’s components from the United States for combination overseas. 35 U.S.C. s 271(f)(1). The Federal Circuit had held that a single component—in this case, of a five-component test kit—could be sufficiently important to a patented invention to constitute “a substantial portion.””
“The Supreme Court has reversed the Federal Circuit in Life Tech v Promega, ruling that manufacture and exportation of a single component of a patented invention assembled in another country is not enough for infringement in the US. However, as a concurring opinion and observers note, the Supreme Court did not indicate how much more than one is enough,” MIP wrote.
“IAM is basically ranting about this ruling because SCOTUS didn’t rule for patent maximalists.”IAM, the lobby of the patent maximalists (disguised as press whilst lobbying/preaching), wrote: “Yet again #SCOTUS left #patent community in the dark on a key part of its latest ruling” (misinformation).
Well, by “patent community” they mean something like “hedge funds of the patent world”, not a community per se. And nobody is really left “in the the dark”; it’s just a dark day for patent maximalists.
IAM is basically ranting about this ruling because SCOTUS didn’t rule for patent maximalists. To quote their blog post about it:
Seven US Supreme Court justices issued their latest patent ruling yesterday in a case that may not have been awaited with the same level of expectancy as next month’s oral arguments in the venue selection case TC Heartland, but which nonetheless showed them sticking to form. As ever with this court it was a case of what wasn’t said as much as what was outlined in the decision.
The case in question, Life Technologies Corp v Promega Corp, involved the supply of a single infringing component manufactured in the US by Life Technologies but then shipped to the UK for assembly. Promega sued citing the Patent Act’s prohibition of the supply from the US of “all or a substantial portion of the components of a patent invention” for combination abroad.
As for Patently-O, it said about Life Technologies Corp. v Promega Corp. that “[i]n a largely-unanimous opinion, the Supreme Court has ruled that the “supply of a single component of a multicomponent invention for manufacture abroad does not give rise to §271(f)(1) liability.””
“Patent maximalism is good for nobody except those who make a living from nothing other than patents (no actual invention, production and so on).”“Writing for the court,” Patently-O added, “Justice Sotomayor found that the “substantial portion” should be seen as a quantitative requirement and that a single component is not sufficient.”
The very fact that sites like IAM are upset about it should say quite clearly that it’s a good and positive development. Patent maximalism is good for nobody except those who make a living from nothing other than patents (no actual invention, production and so on). █
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Pseudo-intellectuals who lobby for their bottom line (pockets) want PTAB destroyed
Summary: A roundup of PTAB news, ranging from attacks on the legitimacy of PTAB to progress which is made by PTAB, undoing decades of overpatenting
THE progress made by PTAB, which faces record demand, makes patent maximalists squirm. That in itself is an indication that it is doing the right thing.
Remember the time Watchtroll used words like "impotence" to insult PTAB? That’s a classic! Watchtroll is so angry at PTAB right now that he (the founder) even resorts to bad grammar in the headline, “The PTAB is a thoroughly broken tribunal incapable of being fixing” (don’t laugh, he may be having a tantrum which isn’t good for his already-questionable health).
“And to think that companies like IBM actively support such attack sites says a lot about IBM…”“The PTAB is a thoroughly broken tribunal incapable of being fixing,” says one whose entire worldview is broken. What PTAB does is it fixes a problem, but Watchtroll and his swamp now hijack the word "fix" and ascribe it to the tackling of PTAB itself, as we noted the other day. Amazing! Incredible!
What will Watchtroll do next in his efforts to dismantle patent progress? He already shames and spreads false rumours about the Director of the USPTO, in an effort to get her ousted/fired. It’s appalling and it’s painful to watch. And to think that companies like IBM actively support such attack sites says a lot about IBM…
“This is very interesting. So Unified Patents takes practical steps to help defendants; in this case, a patent gets challenged in an IPR filed by a collective actor/action.”Anyway, in more positive news about PTAB, “MyMail patent [gets] challenged in IPR2017-00967 filed by @unifiedpatents,” according to this new tweet. “For more information, go here…” (original link).
This is very interesting. So Unified Patents takes practical steps to help defendants; in this case, a patent gets challenged in an IPR filed by a collective actor/action. It’s a good approach, and it is aided by PTAB. This same approach, which was already embraced by the EFF at times, promises to deter if not eliminate some notorious patent trolls. To quote from the site of Unified Patents:
On February 24, 2017, Unified Patents Inc. filed a petition for inter partes review on a patent owned and asserted by MyMail, Ltd. In the IPR2017-00967 petition, Unified challenged the patentability U.S. patent 8,275,863 which teaches methods of modifying a toolbar to facilitate internet traffic.
If your patent is rubbish, don’t expect to change it ‘on the go’ in order to dodge invalidation. As this other new report notes: “Among the changes brought about by the America Invents Act (AIA) was the creation of new post-issuance review proceedings – inter partes review (IPR), post-grant review (PGR) and covered business method review (CBM)” and “Amending claims at the PTAB [is] a fool’s errand?”
Well, yes. It barely ever happens. PTAB should invalidate patents rather than allow them to be modified. Patents are not something dynamic that can just be edited as one goes along. We wrote about this before.
To be fair, inter partes reviews don’t always result in success, i.e. invalidation (that would destroy the perception of justice anyway), but the success rate is very high. Here is an inter partes review which involves not software patents. As Law 360 put it the other day:
The Patent Trial and Appeal Board on Tuesday declined to review claims in a Chamberlain Group Inc. patent on garage door openers, just a few weeks after the Federal Circuit said that a rival manufacturer had raised a “substantial question of invalidity” with respect to the patent.
PTAB denied two separate petitions from a unit of Techtronic Industries Co. Ltd. seeking inter partes review of various claims in the patent. The petitioner, One World Technologies, argued that the challenged claims were invalid
So for those who think that PTAB is just blindly eliminating patents, it clearly does not do this. Many of the patents it invalidates these days are software patents and other abstract nonsense. That’s what courts at the highest levels have requested, e.g. in Alice (but not limited to it). Understandably, that’s what most petitions (IPRs) are filed to enforce.
PTAB has made a great first step against patent parasites that want to ‘own’ lives, too. The other day we wrote about the CRISPR case (covered here for a number of years) and it’s still making some headlines. “The eagerly-anticipated ruling from the PTAB of “no interference-in-fact” is a win for the Broad Institute in its CRISPR patent battle with University of California Berkeley. But much wrangling lies ahead over the rights to the gene-editing technology, including a potential appeal and likely licensing disputes,” wrote Natalie Rahhal for MIP.
Thankfully, PTAB expands beyond software patents and now tackles all sorts of patents that are working against public interests and ethics. PTAB, unless patent maximalists somehow manage to stop (or sabotage) it, will bring back patent sanity to the US. See what Patently-O wrote the other day about the promise of “[a] written decision on “every claim challenged””. Patently-O explains that “[t]he basic issue – under the statute, can the PTO (the PTAB acting as the Director’s delegate) institute inter partes review to a subset of the challenged claims? Or, does the requirement for a “final written decision as to every claim challenged” require that the Board grant or deny the petitions as a whole.”
This seems to be a method for slowing PTAB down and proponents of this approach are not too shockingly patent maximalists. █
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This intervention from CAFC can spell doom for some more patent trolls
Summary: Patents on tasks that can be performed using pen and paper (so-called ‘business methods’, just like algorithms) and oughtn’t be patent-eligible may be the next casualty of the America Invents Act (AIA)
THE PAST week was an important week for the subject of patents on business methods (CBM, or covered business method), almost a sibling of software patents. There were also many articles on the subject, including this from the mainstream/corporate media (the Wall Street media in this particular case).
“They just mean to say that business method patents may be rubbish and should not be patentable in the first place.”Ignore the expected bias (publication is joined/connected to big banks by the hip) and disregard the weird and almost incomprehensible headline. They just mean to say that business method patents may be rubbish and should not be patentable in the first place. To quote: “The assertion of a patent against Bank of America, GE Capital Corp. and 40 other financial institutions doesn’t make it a financial business method invention vulnerable to attack in a Patent and Trademark Office special proceeding, an appeals court said Feb. 21 ( Secure Axcess, LLC v. PNC Bank N.A. , 2017 BL 51354, Fed. Cir., No. 2016-1353, 2/21/17 )”
Also from the article: “Patent challengers like the special “covered business method” proceeding because it gives them more options to make invalidity charges, such as on whether the invention is patent-eligible. In November, the U.S. Court of Appeals for the Federal Circuit ruled against Apple Inc.’s argument that a CBM patent includes one whose invention is “incidental” to financial activity. The court’s 2-1 decision Feb. 21 further limited CBM to be more dependent on what, exactly, the patent holder claimed.”
Michael Loney, a PTAB expert from MIP, covered it as follows, taking note of the relevance to PTAB:
The Federal Circuit has concluded “the patent at issue is outside the definition of a CBM patent that Congress provided by statute” in its Secure Axcess v PNC Bank National Association ruling. Judge Lourie wrote a dissent, backing up the PTAB’s determination
The Federal Circuit has reversed the Patent Trial and Appeal Board (PTAB) in secure Axcess v PNC Bank Association.
WIPR‘s article about it was fairly detailed:
The US Court of Appeals for the Federal Circuit concluded that the Patent Trial and Appeal Board (PTAB) adopted a statutory definition of covered business method (CBM) patents that went too far.
In an opinion handed down on Tuesday, February 21 in Secure Axcess v PNC Bank, the court reversed the finding that a patent owned by internet security company Secure Axcess was a CBM.
Secure Axcess challenged a final written decision of the PTAB that held that its patent was a CBM.
The dispute concerned US number 7,631,191, called “System and method for authenticating a web page”.
Now watch the following CBM review, which involves Ericsson’s patent troll, Unwired Planet LLC. Law 360 had this to say about it:
Unwired Planet LLC urged the Federal Circuit on Wednesday to let stand its November decision that held the Patent Trial and Appeal Board is using an overly broad definition of what qualifies under its covered business method patent review program.
In a brief responding to Google Inc.’s request for an en banc rehearing, the company said the appeals court rightly reined in the PTAB’s authority for reviewing patents directed at financial services, arguing that Google and its tech company amici are inappropriately asking a federal appeals…
Patently-O, in the mean time, wrote about CBM reviews as follows, taking stock of AIA (which brought PTAB): “The America Invents Act created a temporary mechanism (8-year) for challenging certain “covered” business method patents. The program will sunset for new petitions in the “Transitional Program for Covered Business Method Patents” (“CBM review”) sunsets on September 16, 2020. The program allows for CBM patents to be challenged on any ground of patentability (e.g., Sections 101, 102, 103, and 112) and is not limited to post-AIA patents.”
This has been a fantastic and very successful program. No business methods should be patentable and the CAFC has been looking into it, in effect (or potentially) axing a lot of patents that should never have been granted in the first place. █
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It’s driving the patent maximalists nuts!
Summary: The Court of Appeals for the Federal Circuit (CAFC) continues to accept about 4 out of 5 decisions of the Patent Trial and Appeal Board (PTAB) and the US Supreme Court (SCOTUS) refuses to intervene
WE are very gratified to see the USPTO improving patent quality by means of appeals, or by revisiting and reassessing already-granted patents. There has been a lot of news about that this past week and below is an outline.
We previously wrote a number of articles about CSIRO and CRISPR, which served to demonstrate unjust patents that went against public interests, sometimes at the expense of the public. Well, PTAB, based on this new blog post, finally — one might say belatedly — takes on CRISPR and the patent parasite, CSIRO (Commonwealth Scientific and Industrial Research Organisation), which earned a lot of disdain/notoriety for its patent strategy. “The gene-editing tool CRISPR,” IAM wrote, “is in the process of transforming the life sciences industry.”
“We certainly hope that PTAB will somehow take public interests into account, but that’s not how PTAB works.”IAM means privatising and monopolising, even by means of lawsuits. The promotional and defensive language carried on as follows: “Perhaps not surprisingly with such a revolutionary technology still in its relative infancy, a dispute over patents between universities and research institutes that have been at the forefront of its development, erupted over just who owns some of the foundational IP.”
Maybe nobody? Especially given that money for this work came from the public?
We certainly hope that PTAB will somehow take public interests into account, but that’s not how PTAB works. It assesses patents not on ethical grounds but based on the guidelines/laws/rules.
Watchtroll Still at It… Denying Facts
Watchtroll’s PTAB bashing is nothing new (see screenshot at the top). The site continued with this bashing today (factually-flawed and structurally-incoherent drivel that’s akin to fake news). According to this new article, which is based on statistics from the first day of the month, “Federal Circuit PTAB Appeal Statistics” suggest that in addition to the all-time high for PTAB in January, CAFC agrees with PTAB ~80% of the time. It means that PTAB is doing its job capably and correctly. To quote from Lexology: “Through February 1, 2017, the Federal Circuit decided 161 PTAB appeals from IPRs and CBMs. The Federal Circuit affirmed the PTAB on every issue in 125 (77.64%) of the cases, and reversed or vacated the PTAB on every issue in 13 (8.07%) of the cases. A mixed outcome on appeal, where at least one issue was affirmed and at least one issue was vacated or reversed, occurred in 14 (8.70%) of the cases.”
“Put in simple terms, PTAB maintains its ability to crush bad patents and CAFC generally agrees with PTAB in 77.64% of the cases it looks at. “The statistics for 2016 were very similar, as we noted here before (the exact number was 77.4% rather than 77.64%, so the increase is marginal). Put in simple terms, PTAB maintains its ability to crush bad patents and CAFC generally agrees with PTAB in 77.64% of the cases it looks at.
Based on more news, PTAB continues to smash patents to pieces, and CAFC agrees, as usual. To quote:
After the Patent Trial and Appeal Board found claims of ImmunoGen Inc.’s U.S. Patent No. 8,337,856 nonobvious, non-practicing entity Phigenix, Inc. appealed to the U.S. Court of Appeals for the Federal Circuit. The Federal Circuit dismissed the appeal, finding that Phigenix lacked standing to appeal because it had not established it had suffered an injury in fact.
Prior to filing its inter partes review petition, Phigenix was engaged in litigation with a third company, Genentech, Inc., over a Phigenix patent, U.S. Patent No. 8,080,534. Phigenix asserted that the ’534 patent covered Genentech’s manufacture and sale of a drug, Kadycla. Genentech produces the drug under a “worldwide exclusive license” from ImmunoGen for the ’856 patent. As part of its efforts to commercialize its own patent portfolio, Phigenix filed the petition for inter partes review of the ’856 patent, alleging claims 1–8 were invalid as obvious over various prior art references.
CAFC is again (as usual) agreeing with PTAB that Depomed’s patent should be invalidated, based on this new report:
The Federal Circuit on Tuesday affirmed the U.S. Patent and Trial Appeal Board’s decision in an America Invents Act inter partes review that Depomed’s patent on extended-release drug technology is invalid as obvious, saying the board’s conclusion is backed by substantial evidence.
There is another high-profile ‘case’ (petition rather) in the pipeline. Here are the details from the news:
Days after rejecting a challenge from Roxane Laboratories to a patent related to Novartis’ blockbuster cancer drug Afinitor, the Patent Trial and Appeal Board agreed recently to review the patent based on a challenge from another generic drugmaker, Par Pharmaceutical.
In a Feb. 15 decision, the PTAB found that Par Pharmaceutical Inc. had shown the patent was likely invalid as obvious. Par, which was previously sued for infringement, filed a petition seeking inter partes review last summer.
Justice does not seem plausible and is not perceived as legitimate when the outcome is always the same (like FISA rubber-stamping), so there are also exceptions. Here, for a change, “PTAB Follows Fed. Circ. Lead, Upholds Trading Patent” and to quote:
A split Patent Trial and Appeal Board on Friday followed the lead of the Federal Circuit and upheld a Trading Technologies International Inc. electronic trading patent, finding it was not invalid under the U.S. Supreme Court’s Alice ruling.
In a 2-1 decision, the PTAB said TradeStation Group Inc. and IBG LLC had not shown why it should break from the appellate court’s Jan. 18 decision, when the court ruled that a judge correctly found this and another Trading Technologies patent covered technological improvements, not abstract ideas…
PTAB Scares the Patent Microcosm
It’s no secret that patent maximalists, unlike actual companies that make things, hate PTAB. In general, PTAB can help save/defend practicing companies, to whom patents are still a two-edged sword. Here we have a law firm asking (seeking attention from potential clients), “Can Your Patent Be Invalidated Without a Trial?”
“As there is no foreseeable case at the SCOTUS which involves software patents, we are pretty certain that there will be no challenge to Alice any time soon.”Well, yes, and many software patents are already as valuable as nothing at all. They are toothless. Trying to litigate with them would benefit nobody except lawyers at both sides. In that sense, such patents may be even worse than none at all. But to quote the above: “Patent owners should be keeping a close eye on a case that may come before the Federal Circuit Court of Appeals that could potentially block challenges to patent validity outside of the courtroom. Cascades Projection v. Epson and Sony 1 asks the court to decide whether the rights granted by a patent are public or private and, in turn, if those rights are capable of being revoked without access to a jury trial.”
We wrote about it earlier in the month. These are edge cases or rare exceptions; thus, promoting these to prospective clients is rather disingenuous and misleading. Or as one might call it — marketing!
SCOTUS Defends CAFC and by Extension PTAB
One interesting case that we spotted today in the news involves a company called Big Baboon (real company name!) and its unusual attempts to challenge patent scope etc. at the US Supreme Court (SCOTUS). Software patents are still dead/dying after Alice, so Big Baboon attempted another angle and failed. To quote:
The U.S. Supreme Court on Monday declined to hear a petition by a Silicon Valley software company asserting that the Federal Circuit has routinely imputed patent law claims into lawsuits that challenge the U.S. Patent and Trademark Office’s procedures in order to exert jurisdiction over the cases.
The high court declined to hear Big Baboon Inc.’s Oct. 10 petition for writ of certiorari, which argued that it was in the public’s interest that the justices stop the appellate court from the “ongoing and palpable” harm it…
This is good news. As there is no foreseeable case at the SCOTUS which involves software patents, we are pretty certain that there will be no challenge to Alice any time soon. There is also no indication from the Trump administration that AIA (which brought PTAB) will be in any sense revoked/undone. █
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