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04.05.18

Oil States is a Lost Cause for Enemies of the Patent Trial and Appeal Board (PTAB); Now They Push Droplets v Iancu Instead

Posted in America, Courtroom, Patents at 9:47 am by Dr. Roy Schestowitz

The US Supreme Court (SCOTUS) has been restoring patent sanity in recent years and judges must adapt. The Eastern District of Texas (EDTX, or TXED below) remains the outlier.

Docket Navigator chart
Image credit/original: Docket Navigator

Summary: The latest PTAB news and updates from courtrooms where frivolous litigation with low-quality patents carries on

THE Oil States decision will come soon (Supreme Court 2018). It’ll likely be a depressing one for the patent microcosm, or one they’ll attempt to spin. For the USPTO it’ll mean more of the same, i.e. PTAB correcting and affirming examiners.

“The Oil States decision will come soon (Supreme Court 2018).”The anti-PTAB brigade has been SLAPPing us recently; it does not wish to be criticised. The anti-PTAB brigade also tries to bring another anti-CAFC or anti-PTAB or anti-IPR case to the Supreme Court (in essence defending bogus patents from scrutiny). Yesterday Patently-O promoted Droplets v Iancu, heralding this “new petition for writ of certiorari questions the extent that the Federal Circuit can affirm a PTAB IPR decision on grounds different than those relied upon by the Board.”

Seems like nitpicking. Why should judges not be able to go further than PTAB? If a patent is deemed bogus, then so be it, based on the underlying evidence. What ultimately matters is patent justice. To lawyers, however, justice isn’t what’s most profitable, hence their PTAB bashing is likely to carry on.

“What ultimately matters is patent justice. To lawyers, however, justice isn’t what’s most profitable, hence their PTAB bashing is likely to carry on.”Yesterday we saw Robert Jain from Unified Patents announcing a new milestone, having disarmed a patent troll called Pen-One. “On April 4, 2018,” he wrote, “the Patent Trial and Appeal Board (PTAB) instituted trial on all claims in an IPR filed by Unified against U.S. Patent 7,281,135 owned and asserted by Pen-One Acquisition Group, LLC, an Equitable IP subsidiary and a well-known NPE. The ’135 patent, directed to an identity verification system, has been asserted against such companies as Apple and Samsung.”

Samsung and Apple are targeted here, so they have a common/shared interest in this IPR (this troll is a problem they have in common). But that does not mean that they’re friends. The latest in the patent battles of Apple (Apple Inc. v Samsung Electronics Co. Ltd., et al) was also noted yesterday by Docket Navigator, which wrote:

The court granted in part defendant’s motion to exclude the testimony of plaintiff’s technical experts because their application of the “designer of ordinary skill in the art” and “ordinary observer” standards to identify the relevant article of manufacture was improper.

Incidentally — and also quite exceptionally — Docket Navigator publishes some new charts. It shows how different patent (and beyond) judges decide on cases and included is the “reprehensible” (politicians call him that) Gilstrap, named on the left among names/breakdown of judges. Mind the IPR barcharts.

“The US patent system, if properly reformed by AIA/PTAB, would decrease the number of lawsuits (as well as lawyers) and hence discourage such unfortunate incidents that harm small businesses the most.”Regarding another new patent decision, Docket Navigator spoke of a “Parade of Horribles”, citing the text from ATEN International Co., Ltd. v Uniclass Technology Co., Ltd. et al.

It’s a jury deciding, i.e. people who are likely nontechnical:

Following a jury trial, the court denied defendants’ motion for attorney fees under 35 U.S.C. § 285 because plaintiff’s litigation positions and tactics as a whole were not exceptional.

What’s at stake here is who pays for the lawyers, but as usual the lawyers don’t need to care all that much. They just do the billing, so plaintiffs and defendants both lose money; the question is, who loses more money.

The US patent system, if properly reformed by AIA/PTAB, would decrease the number of lawsuits (as well as lawyers) and hence discourage such unfortunate incidents that harm small businesses the most.

04.04.18

The Patent Trial and Appeal Board (PTAB) Breaks More Records, This Time Number of Post-Grant Review Petitions

Posted in America, Courtroom, Patents at 9:59 am by Dr. Roy Schestowitz

Summary: The latest statistics (March) from PTAB show that things are going well and only on rare occasions does the Federal Circuit (CAFC) stand in the way; the US Supreme Court is expected to defend PTAB very soon

THE improved quality of patents at the USPTO gives reasons for optimism; the same cannot be said about the EPO unless António Campinos changes something fast (Battistelli won’t change a thing). Imagine the EPO adopting a PTAB-like mechanism (it already has the Boards of Appeal) that can eliminate thousands of patents rather quickly, especially patents granted in a hurry throughout the Battistelli era. Oppositions already work to that effect, but not post-grant.

Anyway, this latest PTAB round-up says in the summary: “Patent Trial & Appeal Board developments in March included the most post-grant review petitions filed in a month, a predicted switch to the Philips standard, two informative decisions involving 35 USC § 325(d), and the Board instituting trial to a derivation petition for the first time” (also remember that the USPTO recently raised the price of PTAB IPRs; evidently that wasn’t enough to discourage/slow down the constant growth in petitions which tackle bad patents, i.e. those wrongly granted by the USPTO).

Are PTAB IPRs going away? No way!

Even a patent maximalist like Dennis Crouch does not think so. Hours ago he wrote (again): “We all await the outcome of Oil States. Conventional wisdom is that the case will be a dud and that the Supreme Court confirm the viability of Inter Partes Review proceedings.”

Oil States‘s outcome won’t be much of a surprise. So the anti-PTAB brigade is looking for other strategies by which to slow down PTAB. Here’s Michael Borella with another cherry-picked opinion (already mentioned by Crouch and Kluwer Patent Blog earlier this week).

CAFC judges did, in this particular case, decide against a decision by PTAB, which is rare. Judge Newman, however, found that PTAB did its job properly. Borella put it like this:

Apple argued before the PTAB that “because the mobile unit transmitters in Natarajan operated in low duty cycle RF bursts, it would have been plainly obvious to a person of ordinary skill in the art to have the base station operate in an analogous manner.” Apple further contended that “because the base and mobile stations have the same physical structure, it would have been no more than using a known technique to improve similar devices in the same way.”

[...]

Writing in dissent, Judge Newman took issue with two aspects of the decision. First, she would have found that the PTAB did explain its reasoning regarding the obviousness of the claims in a sufficient fashion. Essentially, Judge Newman believed that the PTAB incorporated parts of Apple’s arguments by reference, and that these arguments were uncontested by DSS. (At the end of the day, the majority seems to object to the PTAB’s conclusion that the duty cycle of the mobile units would also work for the base station, while Judge Newman found such an outcome plausible.) Second, she asserted that the proper remedy for finding the PTAB’s reasoning to be inadequate was to vacate and remand the case for further review by the PTAB.

While the decision/opinion does not bode well for PTAB, it’s actually a rarity, but this is the kind of thing that the anti-PTAB brigade will highlight ad infinitum, as usual.

There’s meanwhile this new report (less than a day old) about “seeking to have seven of Nasdaq’s patents canceled.” Notice the part about Alice:

Nasdaq Inc. is trying to claim that it invented the concept of options trading, rival Miami International Holdings Inc. said in a series of petitions seeking to have seven of Nasdaq’s patents canceled.

[...]

Miami International is trying to use the patent office to dispense with an infringement lawsuit that Nasdaq filed against it in September in federal court in Trenton as it can be faster, easier and cheaper to invalidate a patent through the review board than in court.

In each of the seven petitions filed in with the review board in the past week, Miami International said the patents cover an “abstract idea” and cites a 2014 U.S. Supreme Court ruling that has led to invalidity rulings against hundreds of software patents.

Those are software patents or patents on business methods. The only thing going in their favour is the number of them; it’s much greater a burden when one needs to invalidate all seven of them.

It remains to be seen how many of these ‘financial’ patents PTAB will render worthless in the coming years. Earlier today there was a self-promotional ‘article’ from Martin M. Zoltick and Mark T. Rawls (Rothwell, Figg, Ernst & Manbeck, PC). These lawyers love talking about blockchains, Bitcoin or cryptocurrency in general. It’s a lot of contemporary hype and all they can drone on about is patents, trademarks etc. Here they are name-dropping “blockchain”, “FinTech” and all kinds of other names/words:

If the past is any indication of what is to come, those who invest in cryptocurrencies, such as Bitcoin, Ethereum and Litecoin, just to name a few, had better buckle-up. It is surely going to be a wild ride as more cryptocurrencies emerge and the growing array of use cases blows hot and cold. The extreme volatility of cryptocurrencies themselves does not appear to be a phenomenon of the patents directed to the technologies underlying these digital currencies and their ecosystems. As the flurry of innovation continues and the cryptocurrency ecosystem becomes increasingly more mainstream, expect to see exponential growth in the cryptocurrency and blockchain-related patent landscape as financial services companies, FinTech startups and a growing number of tech companies from a wide range of industries all vie for a dominant position.

As we’ve been saying for years, all those patents on digital currencies are likely void. GTX Corporation is bullying indie developers/startups using such patents because it knows that they’re poor enough to do anything they can to avoid a court battle (one in which such patents would likely get trashed).

In summary, PTAB remains relevant, its role is expected to soon be cemented by US Justices, and it is actively being used to thwart abusive litigation with abstract patents (typically software patents or patents on business methods).

04.01.18

Patents Roundup: Abject Lack of Proper Patent Justice and Updates From Microsoft’s Patent Trolls and Patent Strategist

Posted in America, Courtroom, Microsoft, Patents at 6:33 am by Dr. Roy Schestowitz

‘“Other than Bill Gates, I don’t know of any high tech CEO that sits down to review the company’s IP portfolio” —Marshall Phelps

Ex-Sun chief dishes dirt on Gates, Jobs
Reference: Ex-Sun chief dishes dirt on Gates, Jobs

Summary: A rundown/roundup of some of the interesting cases and stories, which generally help highlight the wrongs in a system that ought to be improved if its real goal is justice and legitimacy rather than coercion, protectionism, and sometimes racketeering

THERE are legal cases or stories that merit a mention but not a whole article/post. There are thousands of ongoing patent lawsuits in the US (with thousands more being filed each year), hundreds of thousands patents granted by the USPTO annually, and many stories of patent extortion (outside the courts). The ratio between patent extortion (shakedown) and patent lawsuits is difficult to estimate because the former is covert; estimates, however, say that there are several times more of the former than the latter. Below we take stock of some minor posts, stories, summaries, and observations.

Word Limits

“The ratio between patent extortion (shakedown) and patent lawsuits is difficult to estimate because the former is covert; estimates, however, say that there are several times more of the former than the latter.”When the patent courts get overwhelmed by piles of spurious papers (with little substance or relevance) they often feel compelled to act differently. Is this another lawyers’ trick? Maybe. But according to this, there are word limits in briefs now (as some briefs as not brief anymore).

To quote:

One problem with the Court’s approach here is that it made no determination as to whether the incorporation-by-reference was problematic in this situation. In particular, Federal Rule Appellate Procedure 28(i) permits incorporation by reference in consolidated cases involving multiple appellants or appellees.

Concision matters because one side often uses disproportionate amounts of paper to ‘out-pocket’ the other side, in essence using financial muscle to gain legal leverage. This is wrong. Then there’s the option of endlessly appealing decisions to bankrupt the other side if not put sufficient economic pressure for that side to surrender.

“Concision matters because one side often uses disproportionate amounts of paper to ‘out-pocket’ the other side, in essence using financial muscle to gain legal leverage.”Remember that for justice to be served it must not discriminate based on finances. In practice, however, it almost always does. Money buys legal outcomes not just legislation.

Ex Parte Reexamination

Putting the non-English legalese aside (another way for lawyers to deter people from representing themselves), let’s look at Parallax Group International, LLC v Incstores LLC — a case by a company which we mentioned here 15 times before. Here’s some more non-English legalese: “The court sua sponte stayed plaintiff’s patent infringement action pending ex parte reexamination to conserve judicial resources.”

“Remember that for justice to be served it must not discriminate based on finances.”Sua sponte is just a lawyer’s way of saying “on its own motion,” which means that Parallax needs to wait. We previously remarked on all those nonsensical words/phrases, like inter partes review, ex parte reexamination, sua sponte and estoppel.

No, these lawyers don’t speak Latin or anything, they just try to make life more complicated for clients so that they get hired again and again. Maybe some of them try to impress with pseudo-multilingual skills (which rarely exist).

PTAB

Speaking of inter partes reviews, which is just a ‘fancy’ way of saying petition to reassess/review a granted patent after an applicant secured the grant, Michael Loney said a few days ago that “PTAB institutes first derivation trial” and to quote:

After more than 50 petitions, the Patent Trial and Appeal Board has instituted a derivation trial for the first time, challenging a patent for a spacer frame used in insulated glass windows

The Patent Trial & Appeal Board has instituted trial to a derivation petition for the first time, in Andersen Corporation v. GED Integrated Solutions (DER2017-00007).

The rather misleading term “derivation trial” is what the Office defines here. It’s worth noting that 50 petitions had been filed before action was actually taken!

Patent Trolls

Aggressors and patent trolls have gotten ever so desperate to bypass TC Heartland (last year’s decision by SCOTUS) and drag patent lawsuits to trolls-friendly courts (or districts, or district courts). In Peerless Network, Inc. v Blitz Telecom Consulting, LLC et al, according to Docket Navigator, “[t]he court granted defendants’ alternative motion to transfer for improper venue because defendants did not have a regular and established place of business in the district.”

“Under a faithful reading of the statute,” the court said, “the Court must conclude that whatever a ‘place of business’ is, it is not a shelf.”

“No, these lawyers don’t speak Latin or anything, they just try to make life more complicated for clients so that they get hired again and again.”How many more ‘artistic’ interpretations will be attempted so as to bypass TC Heartland? It almost never works.

Microsoft’s Patent Troll

Microsoft’s patent troll Finjan will “Host a Shareholder Update on April 5, 2018,” it says in a new press release. That’s 4 days from now. What will be discussed? Who to sue next? Will Microsoft help bankroll the litigation? Or say who to ‘punish’ next? Will people who pay ‘protection’ money to Microsoft find themselves protected from this troll?

And in related news, Forbes has given a blog to Marshall Phelps, who is responsible for Microsoft’s and IBM’s patent aggression strategies. Forbes also gave blogs to literal patent trolls from Dominion Harbor, which says a lot about Forbes. In his latest post Phelps says: “Everybody knows that strong patents help decide the winners and losers of business competition — which is why companies applied for roughly 600,000 of them last year (though only half that number were granted)…”

“…Forbes has given a blog to Marshall Phelps, who is responsible for Microsoft’s and IBM’s patent aggression strategies.”The person who is responsible for patent bullying at two of the largest and most aggressive ‘patent companies’ says it “help[s] decide the winners and losers of business competition,” so maybe he should also join a large military contractor and explain how dropping lots of bombs “help[s] decide the winners and losers” of wars… since he evidently lacks any sense of morality.

$235 Million Verdict

The latest reminder that actually reading patents, i.e. making an infringement willful, can be very extremely expensive? Here it is:

Following a jury verdict of willful induced infringement of plaintiffs’ congestive heart failure treatment patent and damages of $235 million, the court granted defendant’s renewed motion for judgment of noninfringement as a matter of law because substantial evidence did not support the jury’s finding that defendant induced doctors to infringe

Large firms such as Microsoft openly say that they intentionally ignore patents of other companies for this reason. Does that not defeat the whole purpose of a patent system then? The whole basis or premise of this system was that it would help disseminate if not preserve human knowledge.

Somaltus LLC v The Noco Company, Inc

As always, whenever there’s patent mess only lawyers will profit. They’re guaranteed to win financially (even if they lose a case). It’s therefore in their best interest to make things messy and keep them that way. “Following plaintiff’s voluntary dismissal,” shows this new example, “the court denied defendant’s motion for attorney fees under 35 U.S.C. § 285 because plaintiff’s litigation positions were not unreasonable.”

“As always, whenever there’s patent mess only lawyers will profit.”Whoever pays the fees, that won’t matter to the lawyers. It only matters to the companies they represent (at both ends). Maybe that can help more companies rethink the role of the status quo and whether it suits them or not. If not, maybe they should support reformist actions from the EFF, CCIA, HTIA (High Tech Inventors Alliance) and the likes of these. PTAB helps a lot already and it’s not hard to show support for it. Recently, our support of PTAB earned us threats of legal action. We’ll write about it later this week.

03.31.18

The ITC Administrative Law Judges Continue to Do Bizarre Things About Expiring Patents, Including Cisco-Imposed Embargo on Competition Using Invalid (Rejected by PTAB) Patents

Posted in America, Courtroom, Patents at 10:27 am by Dr. Roy Schestowitz

Administrative Law Judge Photos
Reference: Administrative Law Judge Photos

Summary: Once again we are seeing the International Trade Commission giving ‘teeth’ to patents that aren’t really legitimate (or nearly invalid/expired) and serve no purpose other than embargoes, which merely harm customers by limiting choice

Yesterday we found this new little rant from the CCIA. Josh Landau alluded to something from Thursday:

Yesterday, the ITC published the Federal Register notice of the initial determination of an ITC administrative law judge (ALJ). The ALJ determined that the investigation, instituted in January based on a complaint filed last year, shouldn’t go further forward and terminated the case for good cause.

I’m going to totally set aside the merits of the (questionable) patent involved in this case, U.S. 7,930,340. (I will note that the plaintiff has previously been sanctioned by the Federal Circuit for trying to evade word count limits by deleting spaces between words.) I’m going to focus on one thing—expiration.

The patent was filed claiming priority to an application filed August 5, 1996. It was given 577 days of extra patent term due to time in prosecution. That means that it expires 20 years and 577 days after August 5, 1996—on March 6, 2018.

The ITC just forced the defendants to spend several months paying to defend themselves against a patent that everyone involved knew would expire before the ITC acted.

This is truly incredible (and well caught by CCIA). What is the ITC thinking?

“The odd thing is, Cisco is one of the vocal proponents of PTAB.”Unfortunately we’ve found ourselves having to criticise ITC quite a lot over the past year. Even earlier this month. The latest in Arista Networks v Cisco Systems, or Arista challenging patents that Cisco uses in an effort to embargo the competition (through ITC), is now the subject of a new post at Patently-O. As a reminder, ITC (in)famously discarded the judgment of PTAB and persisted with an embargo. To quote Patently-O:

In what is mecoming [sic] a more regular outcome, the Federal Circuit has again vacated a PTAB IPR holding — holding that the USPTO’s panel of Administrative Patent Judges failed to “adequately explain its reasoning on a point that was central to its analysis.”

This time the case involves a PTAB finding for the patentee — that the IPR challenger Arista had not proven obviousness (for several challenged claims of Cisco’s Patent No. 8,051,211). The identified failure was in addressing a particular argument for how the prior art taught the claimed invention.

Does it mean that the embargo carries on (or products modified, i.e. made worse, just to bypass it)? That while guilt has not been established Arista is still being punished (quite severely in fact, sinking the stock)?

“The bottom line is, Cisco seems to enjoy PTAB and support PTAB as long as ITC weirdly enough snubs PTAB and simply maintains an embargo on Cisco’s competitors.”The odd thing is, Cisco is one of the vocal proponents of PTAB. It even funds PTAB advocacy front groups.

Meanwhile, a Microsoft-connected law firm mentions (as recently as yesterday) some company we never heard of. It’s suing Cisco using patents, which might explain why Cisco does support PTAB (it also employed Patent Troll Tracker, who got himself and Cisco sued after the late Ray Niro had unmasked him). To quote:

In a new twist in competitor-based lawsuits involving cloud computing, Centripetal Networks, a relative newcomer, filed a patent lawsuit against industry incumbent and Fortune 100 Company Cisco in the U.S. District Court for the Eastern District of Virginia in February 2018. Centripetal has focused its technology on network intelligence and security solutions since its founding in 2009. In its 136 page complaint against the networking solutions giant, Centripetal has alleged infringement of ten patents (out of its total portfolio of fourteen patents).

The bottom line is, Cisco seems to enjoy PTAB and support PTAB as long as ITC weirdly enough snubs PTAB and simply maintains an embargo on Cisco’s competitors.

Massive Discovery Misconduct and New Litigation Misconduct Show That the Patent World is Not Always About Justice

Posted in America, Courtroom, Deception, Patents at 9:52 am by Dr. Roy Schestowitz

We have got a winner

Summary: Manipulation of the legal system, or arm-wrestling the law in order to get one’s way, still a problem for the credibility of today’s patent system (rife/riddled with misconduct)

EVERY now and then we document or pile/assemble together examples of misbehaviour, not necessarily at patent offices (EPO, USPTO and so on) but in courts and law firms. There’s no lack of examples. The system is far from perfect, transparency can always help, and pointing out flaws can help correct these.

A few days ago “massive discovery misconduct” was reported in a case where the “plaintiff’s severed litigation misconduct was exceptional.”

“Following plaintiff’s post-Markman stipulation of dismissal and a bench trial finding inequitable conduct,” Docket Navigator summarised, “the court granted defendant’s motion for attorney fees under 35 U.S.C. § 285 because plaintiff’s severed litigation misconduct was exceptional.”

Well, patents are, with few exceptions, not used amicably. And those who use them for hostile purposes are not exactly likely to act in good faith.

Another example of misconduct was covered a few days ago by David Hricik, who focuses on ethical matters. “In addition to this evidence,” he said, “the district judge heard evidence of various litigation misconduct…”

Here are the details:

Last month, the Federal Circuit held oral argument in an appeal, styled Gilead Sciences, Inc. v. Merck & Co., Inc. (Appeal Nos. 16-2302 & -2615) from a judge’s decision which held a patent unenforceable — for unclean hands — after a jury returned a verdict of $200 million. A more detailed write up is here which includes a link to the oral argument.

Boiled down, in a bench trial after the verdict, the judge heard evidence that Gilead had agreed to share information with Merck regarding an antiviral agent against Hep C — provided Merck personnel working on Merck’s competing work be walled off rom the information. Gilead shared information on a call… and a Merck attorney who was on the call who was prosecuting a Merck competing application then amended claims to cover the Gilead product.

As a twist, the application that was amended supported the Gilead product, and the jury had found no derivation. The reason was that the amended Merck application had support for a large genus of compounds, but the amendment narrowed to a subgenus which included Gilead’s leading agent. In other words, Merck had invented the Gilead product, and so there was no but-for materiality (in any meaningful sense that I can see, at least).

In an ideal patent system the patents granted would be of high quality, litigation be a last resort, and the legal process involve no misconduct. But in a world where lawyers on both sides just try to win the case can we expect justice or a shouting match where the longterm goal is to drain the opposition’s pockets (with legal fees)?

Unified Patents: Patent Litigation in the US is Still Dominated by Patent Trolls That Create Nothing But Lawsuits

Posted in America, Courtroom, Patents at 7:12 am by Dr. Roy Schestowitz

This is not innovation but parasitic taxation

IoT NPE litigation

Summary: Some complete/exhaustive statistics (not interpolated/extrapolated but limited to one area) from Unified Patents help demonstrate trends in patent litigation in the United States; it’s clear that much work remains to be done by patent reformers

EVEN though it’s Easter (so we’ve been writing less) the USPTO continues granting patents and lawsuits continue to be filed. On Wednesday/Thursday, for example, Unified Patents showed that patent litigation is dominated by patent trolls, at least when it comes to software patents ‘dressed up’ as “Internet of Things”. There are plenty of figures in this analysis and we have reproduced only one (above) under Fair Use.

From the outline:

From 2012 to 2017, NPE litigation activity for Internet of Things (IoT) technologies remained consistently high (between 85% and 98% of all IoT litigation). After reaching a record number of new IoT litigations in 2016, new filings in 2017 returned to pre-2016 levels. While litigation involving most IoT technologies either decreased or saw marginal increases in 2017, the proporation of IoT litigation over Communication Protocols & Networking increased from 3% (2016) to 44% (2017).

Unified Patents’ Robert Jain later (yesterday) added: “Whatever the cause, the volume of NPE-related filings [troll lawsuits] remains high as is seen in the figures below.”

Patent litigation in Q1 2018 held steady with the number of new filings slightly exceeding the volume of cases seen in the second half of 2017. In recent years, the number of new filings has been highest in the first and second quarters which may indicate we will see fewer patent litigations in 2018. However, the uncertainty surrounding upcoming changes in patent law, such as the pending Oil States decision, may be in part responsible for these lower filing rates. Whatever the cause, the volume of NPE-related filings remains high as is seen in the figures below.

In relative terms, patent trolls are still a major problem. Sure, the overall number of patent lawsuits nosedived, but that did little to tackle patent trolls specifically and a lot of their nefarious activity goes on not inside the courtroom but outside the legal system. They bully and eventually extort companies, otherwise that ends up with lawsuits.

We are far from done reforming things; the software community should not assume that 35 U.S.C. §101 changes have fixed everything. Much of the blackmail is extrajudicial in nature, which means that the views/interpretations of courts/PTAB never get factored in (or into calculations associated with the harm done by trolls).

03.25.18

Where Opposition to the Patent Trial and Appeal Board (PTAB, AIA) Has Come From Over the Past Week If Not Year

Posted in America, Courtroom, Patents at 11:18 am by Dr. Roy Schestowitz

Follow the drops of oil

Cato Institute and Koch Brothers Reach Agreement - The New York Times
Reference: Cato Institute and Koch Brothers Reach Agreement – The New York Times

Summary: The push against PTAB, a relatively short time before the much-anticipated Oil States decision, appears to have lost momentum; but those who persist are almost always linked to patent maximalism

QUALITY assurance is essential when it comes to patents. That is the whole essence of patent examination — something which EPO management conveniently overlooks when it turns the EPO into another INPI. The USPTO, by contrast, enjoys scrutiny from PTAB, which basically reassesses granted patents and sometimes patent applications too. PTAB helps assure that people who were granted patents have confidence in enforceability (or lack thereof). Spurious expenses, notably court/lawyers’ fees, are being spared. Sounds good, no? Well, not to patent maximalists. The lawyers want a lot of fights because they profit from these fights.

“Spurious expenses, notably court/lawyers’ fees, are being spared. Sounds good, no? Well, not to patent maximalists.”This post glues together recent developments related to PTAB, which we expect to be further cemented into the system when SCOTUS rules on Oil States (possibly weeks if not a few months from now).

Several days ago Professor Rantanen (University of Iowa) spoke of a “symposium, Administering Patent Law, [which] is co-sponsored by the Iowa Law Review and the center I direct, the Iowa Innovation, Business and Law Center.”

“The concept of post-grant patent challenges isn’t a novel one, nor should it be controversial.”Rantanen also mentioned Melissa Wasserman's joint paper on why examiners at the USPTO grant low-quality patents which then help patent trolls. More recently she co-authored a paper with Christopher J. Walker. It was about PTAB and it has just been reposted under a slightly different title (“Situating PTAB Adjudication Within the New World of Agency Adjudication”) at Patently-O, again by Jason Rantanen, who wrote three posts there (in just one day) mostly for self-promotional purposes. One of those revealed slight bias — albeit the sort of bias one might expect from Patently-O, which keeps bashing PTAB for at least a year now (we watch these trends closely as we strive to understand and track the money flows).

“Suffice to say, just because someone questions the legitimacy of a patent does not mean that the patent is instantaneously illegitimate. There’s a process for that and it is improving over time.”The concept of post-grant patent challenges isn’t a novel one, nor should it be controversial. The EPO had practiced it for decades (although years ago, under Battistelli, this concept came under attack in defiance of the EPC). The other day we saw this article about US patent number 9,738,929. Arguing over whether the USPTO granted a bogus patent (which happens a lot unfortunately, due to patent maximalists who ruined the system), here is the outcome boasted about in a press release:

ONT had sought to dismiss Pacific Biosciences’ complaint for infringement of U.S. Patent No. 9,738,929 by alleging that the patent’s claims recite ineligible subject matter. A hearing on the matter was held on February 27, 2018 and the ruling by Judge Stark was issued on March 22, 2018. In its ruling, the Court disagreed with ONT’s contentions and also took note of the inconsistent statements made by ONT in front of the U.S. International Trade Commission and in prosecuting ONT’s own, later-filed patent applications.

Suffice to say, just because someone questions the legitimacy of a patent does not mean that the patent is instantaneously illegitimate. There’s a process for that and it is improving over time. PTAB has in fact expanded panels to actually improve confidence and oversight when it comes to patent assessment, but Watchtroll is such a dishonest site that it now claims the very opposite, attributing that to extremists like itself/himself (who profits from such lies). Some say that we should just ignore Watchtroll, but it’s important to see what prominent anti-PTAB sites are saying and occasionally debunk their arguments.

Watch what a Koch-funded think tanker, Adam Mosoff, said a few days ago. Mosoff, who links to Cato (Koch), tweeted: “GREAT READ in @RegulationMag by Professor Jonathan Barnett: How evidence shows that stable & effective property rights in patents are important & why this matters for US innovation economy in 21st century object.cato.org/sites/cato.org… #OilStates #PatentsMatter @CatoInstitute”

“Kochs like to piggyback a pseudo-libertarian sentiment to engender and spread hatred for any sort of government regulation.”It’s not hard to imagine who signal-boosted this. Not only those making a career out of lying for billionaires but also the patent maximalists, such as Ania Jedrusik, who wrote: “There’s no firm basis to assert that the #patent system is regularly issuing low-quality patents or that technology markets are stuck in a morass of patent claims that will frustrate #innovation…”

Kochs like to piggyback a pseudo-libertarian sentiment to engender and spread hatred for any sort of government regulation. This isn’t new. It’s a well-recognised pattern of their lobbying fronts, including Cato. Their meddling in Oil States isn’t surprising either. They have a lot of money at stake.

“In the vast majority of cases PTAB actually (re)affirms examiners’ rejections based on (citing) Section 101.”Thankfully, some of the above is being challenged. FFII Sweden’s Bosson responded with: “What would that benchmark look like? We know from history that regions outside patent systems have been prosperous. East vs West coast US for instance. Now we have Alice vs pre-Alice.”

FFII’s André Rebentisch‏ then said: “The litmus test is: does it involve software? I haven’t seen a non-trivial patent in the field.”

“Exactly,” Bosson replied. “My experience is that pretty much all software parents are abstract methods on math discoveries or information re-organization embedded in patent-babble complexity. Have helped kill one recently – at high cost.”

Don’t tell that to patent lawyers though; they hardly know what software is and how it works, having never written even a simple computer program. Watchtroll attempted to claim that he did, but when asked to name it he ran away and blocked me, hoping to spare himself this embarrassment. He’s no programmer, he fails to explain what computer programs are, yet he constantly promotes software patents. It’s all about money to him.

“Patent maximalists such as IAM and Patently-O are obviously not happy, but what can they do short of attacking judges’ credibility (something that they already do on occasions)?”An online friend of his keeps complaining about rejection of such patents. This one too is no programmer, yet always happy to promote software patents and block those who practice software (like myself). He wrote about a “50 Page Rejection of a Neology Patent after IPR–at least no 101 rejection…” (it’s Section 101 which scares them the most; we’ll cover that separately)

This patent maximalist is citing this PDF [PDF] from the PTAB-hostile Anticipat, selectively choosing a case where, according to him, “PTAB Reversed Examiner’s [Section] 101 Rejection of Claims in SAP Patent Application; Some Good Arguments Presented by SAP Counsel…”

In the vast majority of cases PTAB actually (re)affirms examiners’ rejections based on (citing) Section 101. The same goes for CAFC cases that look into PTAB rejections based on Section 101.

Patently-O has long attempted to change the status quo on IPRs, CBM and so on.”Patent maximalists such as IAM and Patently-O are obviously not happy, but what can they do short of attacking judges’ credibility (something that they already do on occasions)? IAM posted this sponsored rant about CAFC and Patently-O wrote about a case where “the district court followed the PTAB and ruled that the claims were invalid as indefinite.”

Sometimes this PTAB-bashing blog shows (for a change) courts and PTAB in agreement. Most of the time, however, it chooses to highlight dissent. This one is about a laughable patent. Under “AIA Trials” it says that “the Federal Circuit agreed that Sarif’s claim construction position of no-means-plus-function was “well supported” – despite ultimately losing the case.”

On another day it wrote about CBM (Covered Business Method) in relation to AIA. To quote some background:

In the America Invents Act (AIA), Congress created two primary new forms of challenging issued patents in an administrative trial setting before the Patent Trial and Appeal Board. The more popular form is Inter Partes Review while Post Grant Reviews have seen less interest. The comparative popularity appears to stem primarily from the fact that IPRs can be used to challenge any issued patent — including pre-AIA patents and patents issued years-ago. PGRs, on the other hand has two important timing limitations: (1) PGRs are only applicable to post-AIA patents (effective priority date > March 2013); and (2) a PGR petition must be filed within 9-months after the patent grant. That said, IPRs have a comparative downside: While a PGR may challenge patent claims on any patentability ground (except best mode), IPRs are limited only to anticipation and obviousness challenges based upon prior patents and published prior art.

The Covered Business Method Review (CBM) program is added as a layer atop IPRs and PGRs. CBMs can only be used to challenge patents directed to financial, non-technological business methods. However, like PGRs, those CBM patents can be challenged on any ground (including eligibility, enablement, and indefiniteness). Further, like IPRs, CBM petitions can challenge any patent regardless of its filing and issuance dates.

Patently-O has long attempted to change the status quo on IPRs, CBM and so on. Patently-O is all about patent maximalism, i.e. more software patents, patents on business methods etc. It yearns for the old days of patent trolls’ freedom to sue and blackmail everyone.

“It’s actually the Berkheimer nonsense which is “making a comeback,” having been misinterpreted and misused by the patent microcosm for about a month now (we wrote nearly a dozen articles and rebuttals about it).”“Business methods making comeback on appeal at the Board,” Anticipat exclaimed some days ago, “Citing Berkheimer PTAB panel holds Examiner must show evidence…”

It’s actually the Berkheimer nonsense which is “making a comeback,” having been misinterpreted and misused by the patent microcosm for about a month now (we wrote neatly a dozen articles and rebuttals about it). Anticipat writes:

We have previously reported on the very low reversal rates of abstract idea rejection within tech center 3600, home of business method art. Indeed, over the past few months, the reversal rate has been about 12%, as shown on the Anticipat Research database. But the Federal Circuit has recently pushed the Alice test closer toward patentees, and the Board appears to be following their lead. This is shown in a pair of recently-decided appeals involving business method applications

[...]

The PTAB will continue to side with Examiners in affirming many abstract idea rejections of business method applications. But the recent reversals show that a compelling argument lies in the novel arrangement of claim elements. This is especially compelling if the Examiner has not established on the record that these elements are conventional or routine.

So that last paragraph almost directly contradicts the headline and, much as we expected, Berkheimer has made virtually no difference.

But why let facts of even statistics get in the way of ‘good’ agenda? Anticipat goes further with some revealing numbers. Notice the part about Section 101:

We recently reported that the top patent firms (by registered practitioner as featured on a Patentlyo post) pursue ex parte appeals very differently. This, despite apparent equal knowledge of the benefits of pursuing an appeal to further prosecution. While this finding is interesting, pursuing an appeal and winning on appeal are two different things. Here we report on the differences in appeal outcomes along the three firms Finnegan, Fish & Richardson, and Knobbe Martens.

As brief background, we have found that average reversal rates among the various grounds of rejection to be quite stable. In a recent post, we reported that across the entire USPTO, Section 101 has about a 20% reversal rate on appeal, Sections 102 and 112 hover at about 50%, and Section 103 is around 33%. To look at these firms’ outcomes, we used Anticipat’s Research database and Practitioner Analytics.

Got that? Section 101 reversals are at a mere “1 in 5″. So why even bother?

“PTAB actively enforces Section 101 and there are rarely exceptions to that.”The other day a patent maximalist noted that “PTAB Affirmed Examiner’s 101 Rejection for MasterCard Claims for Making a Sale/Payment with a Mobile Device,” citing a new PDF from Anticipat. This is quite frankly the usual; to suggest that there’s a point trying to work around the law is to basically mislead clients. PTAB actively enforces Section 101 and there are rarely exceptions to that. We’ll say more about Section 101 in later posts, especially misuse of Berkheimer as precedent.

03.20.18

35 U.S.C. § 101 is Still Effectively Tackling Software Patents in the US, But Patent Law Firms Lie/Distort to ‘Sell’ These Anyway

Posted in America, Courtroom, Patents at 7:55 am by Dr. Roy Schestowitz

The arts of being a “good” lawyer

Lying by omission
Reference: Lying by omission

Summary: The assertion that software patents are still worth pursuing in 2018 is based on carefully-constructed spin which mis-frames several court decisions and underplays/downplays/ignores pretty much everything that does not suit the narrative

YESTERDAY morning we wrote about how spin had evolved to convince people to pursue software patents (which even the USPTO — let alone courts — makes harder to attain/obtain).

Facts and marketing blend like water and sand. So it’s hardly surprising that little substance exists in these falsehoods-ridden infomercials.

We habitually cover cases that the patent microcosm prefers not to mention (or never to elaborate on). Such cases aren’t good for ‘business’ (patenting and litigation) as they can discourage ‘sales’ of ‘services’. The other day we took note/stock of several such cases.

Yesterday, Immersion Corp. v Fitbit, Inc. was brought up by a site of the patent microcosm, alluding to this latest outcome in a case initiated by Immersion, a notorious patent aggressor if not troll [1, 2] (it’s not exactly a troll, but it has no concrete products, just licensing).

Judge Koh is once again emerging as a somewhat technical judge who is hard to fool. Seeing what kind of patents Immersion is ‘sporting’, she sided with the defendant, Fitbit, whereupon the maximalists said that “it appears as though the lack of detailed physical components and detailed algorithms is what doomed the ’301 patent.”

Goodbye abstract patents.

Here’s more from that post:

Last week, Judge Koh of the U.S. District Court for the Northern District of California deemed claims relating to transmission of haptic messages to be directed to an abstract idea and therefore invalid under 35 U.S.C. § 101.

The Plaintiff, Immersion Corp., alleged that Fitbit’s wearable health and fitness devices infringe three of Immersion’s patents, each of which involve “haptic” feedback technology — namely, technology that provides forces, vibrations, or other motion feedback that recreates a sense of touch for a user. Fitbit filed a motion to dismiss contending that the asserted claims of each patent are patent ineligible under § 101. The District Court denied Fitbit’s motion on two of the three patents, but granted the motion with respect to U.S. Patent No. 8,638,301 (the ’301 patent).

[...]

The District Court then addressed the patent ineligibility of the ’301 patent, whose claimed invention involves a mobile device transmitting a “haptic message” to another mobile device. The patent describes haptic messages as a useful form of non-linguistic communication that tie physical effects to a message, contrasting with more conventional messaging systems that may provide less or no contextual information associated with received and sent messages. For example, the patent describes a scenario in which one user appends a haptic signal simulating a heartbeat to a message, sends the message to the other user along with the haptic signal, which causes the other user’s phone to vibrate in a manner that simulates the heartbeat pattern.

[...]

Given the state of the asserted claims — especially that of claim 27, compared with the other two patents — the District Court’s finding here is relatively unsurprising. Again, it appears as though the lack of detailed physical components and detailed algorithms is what doomed the ’301 patent.

This is a classic example of abstract things that do not merit a patent.

The maximalists have since then turned to other cases, such as this one in which “Zmodo moved to dismiss for failure to state a claim under 35 U.S.C. § 101.”

§ 101 is a recurring theme, but the patent microcosm only really cares when a § 101 challenge is denied (even if it was unsuitably invoked, in cases where the claims are not abstract).

We saw two new examples of that yesterday. Nutter McClennen & Fish LLP came up with that familiar spin pattern that’s intended to help them sell worthless services:

Since the Supreme Court’s decision in Alice Corp. v. CLS Bank in 2014, there has been an increasing trend in district courts granting pretrial dispositive motions to effect early dismissal of patent infringement cases under 35 U.S.C. § 101. Last month, however, the Federal Circuit issued two patent-friendly decisions that preclude such early dismissal when there are factual disputes that underlie the ultimate legal conclusion of patent eligibility under 35 U.S.C. § 101.

We already wrote about a dozen rebuttals to that; but it doesn’t matter, the patent microcosm knows that prospective clients won’t fact-check and might even get the false impression that something substantial has happened and changed. Knobbe Martens was next to exploit these widely-distorted (by the patent microcosm) decisions in order to help itself sell worthless services. It wrote this yesterday:

In two recent cases, the Federal Circuit addressed the role of factual questions in resolving patent eligibility under 35 U.S.C. § 101. The first case was Berkheimer v. HP Inc. and the second was Aatrix Software v. Green Shades Software.[1] These cases possibly undercut the holdings of previous cases in which the Federal Circuit routinely affirmed judgments invalidating patent claims under § 101 in the early stages of litigation, when factual questions are typically unresolved.[2]

They keep mentioning Aatrix and Berkheimer (which we read), but we doubt they even understand these. They just live in a little echo chamber where name-dropping Aatrix and Berkheimer is like showering pixie dust.

Yesterday Watchtroll wrote: “While the value of patents has been under attack (e.g., with the Supreme Court Alice and Mayo decisions limiting what can be patented and the establishment of IPRs), trade secrets have become a bigger risk with the current rapid changing of jobs by engineers and programmers.”

Those patents are not “under attack”, they should never have been granted in the first place and courts belatedly rectify their ways, especially after Judge Rader left the Federal Circuit (he was pretty much forced to leave after he had been caught doing corrupt things).

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