On May 30, 2018, the USPTO proposed rules to mandate e-filing of trademark applications based on Section 1 and Section 44 of the Lanham Act, and to require the designation of an e-mail address for receiving USPTO correspondence. The proposed rule also requires e-filing of all submissions including responses to Office Actions, maintenance declarations, renewal applications, international applications, subsequent designations, and direct filings with the USPTO relating to extensions of protection through the international registration system. More details are available here.
On May 24, 2018, a California jury awarded Apple $533M in damages for design patent infringement by Samsung. Apple Inc. v. Samsung Elec. Co., No. 11-cv-01846 (N.D. Cal.). Apple asserted three design patents and a number of utility patents relating to iPhones and iPads against Samsung. The design patents cover ornamental features of smart phone devices including their shape and graphical user interface. After jury trials in 2012 and 2014, Apple was awarded $399M in damages for design patents infringement. The Federal Circuit upheld the damages in 2015 and the U.S. Supreme Court reversed it in 2016. In reversing and remanding the case, the Supreme Court held that in a multicomponent product, the relevant "article of manufacture" for arriving at a Section 289 damages need not be the end product sold to the consumer but may be only a component of that product.
A new trial on damages was held on May 14-18, 2018. The district court adopted a test formulated by the U.S. Solicitor General during the Supreme Court proceedings. The district court instructed the jury to consider the following four factors: (1) the scope of the claimed design in the patent including the drawings and written description; (2) the relative prominence of the design within the infringing product as a whole; (3) whether the design is conceptually distinct from the product as a whole; and (4) the physical relationship between the patented design and the rest of the product, including whether the design pertains to a physically separable, separately sold, or separately manufactured component. The jury then awarded $533M to Apple in design patent damages. The jury verdict form breaks down the damages among 16 Samsung smartphones without any details on the article of manufacture. Apple sought $1B in total lost profits while Samsung urged the jury to limit damages to $28M based on the infringing components.
On May 8, 2018, the USPTO announced its proposed rulemaking for claim construction standard in PTAB proceedings. The PTO proposed to amend the rules to require the PTAB to interpret the claims in IPR/PGR/CBM proceedings using the same standard as applied in federal district courts and the USITC, and to consider any prior claim construction determination concerning a term of involved claim in a civil action or ITC proceeding that is timely made in the PTAB proceeding. The proposed changes would replace the BRI standard with the claim construction standard used in federal district courts and would be consistent with the PTO's current approach for interpreting claims in an expired patent. Full text of the notice is available here.
On April 26, 2018, USPTO issued guidance on the impact of the Supreme Court's decision in SAS Institute Inc. v. Iancu on AIA trial proceedings. According to the guidance, PTAB will proceed as follows: (1) it will institute as to all claims or none; if it institutes a trial, it will institute on all challenges raised in the petition; (2) for pending trials in which panel instituted trial on all challenges raised in the petition, panel will continue with the proceeding in normal course; (3) for pending trial in which a panel instituted trial only on some of the challenges raised in the petition, panel will issue a supplemental order on all challenges raised in the petition, and take action to manage trial proceeding including permitting additional time, briefing, discovery and/or oral argument, depending on the stage of the proceeding.
Full text is available here.
On April 26, 2018, the Federal Register published USITC's updated rules governing Section 337 investigations. The final regulations contain 11 changes from the proposals. Among the most notable changes, the revised rules: (1) require that the notice of investigation specify in plain language the scope of the accused products or category of accused products that will be subject of the investigation in order to avoid disputes between the parties concerning the scope of the investigation; (2) formally establish 100-day proceeding to provide for expedited discovery, fact-finding, and determinations in an investigation if the commission, at institution, identifies a potentially investigation-dispositive issue; (3) clarify that the Commission may institute multiple investigations based on a single complaint where necessary for efficient adjudication; (4) allow the ALJ to sever an investigation into two or more investigations at any time prior to or upon thirty (30) days from institution, based upon either a motion by any party or upon the ALJ's own judgment that severance is necessary for efficient adjudication; and (5) bring the Commission's subpoena practice into closer conformity with FRCP.
The new rules go into effect for 337 investigations instituted 30 days after publication in the Federal Register. Full text of the amendments is available here.
On April 24, 2018, the U.S. Supreme Court issued its decisions in two much-awaited patent cases involving inter partes review. In Oil States, in a 7-2 decision, the Court held that inter partes reviews were constitutional under the public-rights doctrine. Oil States Energy Svcs., LLC v. Greene's Energy Group, LLC, 584 U.S. ___ (2018). In SAS, in a 5-4 decision, the Court held that the PTAB must decide the patentability of all the claims the petitioner has challenged in an inter partes review. SAS Inst. Inc. v. Iancu, 584 U.S. ___ (2018).
Oil States Energy Svcs., LLC v. Greene's Energy Group, LLC
In Oil States, petitioner Oil States Energy Services, LLC obtained a patent relating to technology for protecting wellhead equipment used in hydraulic fracturing. Oil States sued Greene's Energy Group, LLC for infringement and Greene's Energy challenged the validity in district court and also filed an IPR petition. The district court issued a claim construction order favoring Oil States while the PTAB concluded that the patented claims were invalid. Oil States appealed to the Federal Circuit challenging the PTAB decision and the constitutionality of IPR. While the appeal was pending, the Federal Circuit rejected the constitutionality of IPR in a separate case and summarily affirmed the PTAB's decision involving Oil States.
On appeal, the U.S. Supreme Court held that the inter partes review does not violate Article III. Writing for the majority, Justice Thomas reasoned that IPR falls squarely within the public-rights doctrine and that patents are "public franchises." According to the Court, IPR involves the same basic matter as the grant of a patent subject to the Board's authority and that the Court has recognized that franchises can be qualified in this manner. Addressing the petitioner's arguments, the Court found that the three decision recognizing patent rights are private property were decided under a different statutory scheme, historical practice where courts have adjudicated patent validity does not foreclose Congress from assigning matters governed by public-rights doctrine to the Executive, and that the similarities between the various procedures used in IPR and in courts does not lead to the conclusion that IPR violates Article III. The Court went on to to say that the holding is narrow and does not address whether patents are property for the purposes of Due Process Clause or the Takings Clause.
In his dissent, Justice Gorsuch joined by Chief Justice Roberts, stated that the decision signaled a retreat from Article III's guarantees that "suits at the common law, or in equity, or admiralty" must be heard by independent judges.
Full text of the Oil States opinion is available here.
SAS Institute Inc. v. Iancu
In SAS, petitioner SAS Institute sought an inter partes review of ComplementSoft's software patent alleging that all 16 of the claims were unpatentable. The Director instituted review of only claims 1 and 3-10 and denied review on the rest. At the end of litigaton, PTAB issued a final written decision finding claims 1, 3 and 5-10 to be unpatentable while upholding claim 4. PTAB's decision did not address the remaining claims on which the Director had refused review. SAS appealed to the Federal Circuit which affirmed the Board's decision and dismissed SAS's argument that 35 USC 318(a) required the Board to decide the patentability of every challenged claim in the petition. SAS filed a writ of certiorari.
On appeal, the U.S. Supreme Court, in a 5-4 decision, held that the Patent Office must decide the patentability of all of the claims the petitioner has challenged in an IPR instituted by the PTAB.
Full text of the SAS opinion is available here.
On April 19, 2018, the USPTO issued a memorandum to address changes in patent examination procedure in light of the Federal Circuit's decision in Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018). In Berkheimer, the Federal Circuit held that the question of whether certain claim limitations represent well-understood, routine, conventional activity is a question of fact; the court reaffirmed this standard in subsequent cases regarding judgment on the pleadings and judgment as a matter of law.
USPTO now requires an examiner to conclude that an element or combination of elements represent well-understood, routine, conventional activity only when the element(s) is widely prevalent or in common use in the relevant industry. This determination is distinct from patentability over 102/103 prior art. The examination procedure now requires: (1) a citation to an express statement in the specification or to a statement made by an applicant during prosecution that demonstrates the well-understood, routine, conventional nature of the additional element(s); it cannot be based on the fact that the specification is silent with respect to describing such element; (2) a citation to one or more court decisions noting the well-understood, routine, conventional nature of the additional element(s); (3) a citation to a publication (book, manual, review article, or other source); (4) statement that the examiner is taking official notice of the well-understood, routine, conventional nature of the additional element(s); this option should be used only when the examiner is certain based upon his/her personal knowledge.
Full text of the memo is available here.
On April 17, 2018, the Federal Circuit affirmed the PTAB's finding that patent owner failed to sufficiently corroborate inventor's testimony of conception. Apator Miitors APS v. Kamstrup A/S, No. 2017-1681 (Fed. Cir. Apr. 17, 2018) (Moore, J.). Kamstrup filed an IPR and Board instituted based in part on Nielsen. During trial, Apator attempted to swear behind Nielsen's effective filing date by proffering a declaration from the inventor. PTAB found that the only evidence of an earlier conception date was the inventor's declaration and that "mere unsupported evidence of the alleged inventor, on an issue of priority" was insufficient proof of prior conception. Based on its finding, the PTAB found the claims to be unpatentable in view of Nielsen reference. On appeal, the Federal Circuit, a panel consisting of Judges Moore, Linn and Chen, affirmed finding that substantial evidence supported the PTAB's finding. The Court reasoned that Apator failed to meet its burden of proof because the email evidence provided to support an earlier conception date failed to indicate that a file relating to the invention was attached.
Full text of opinion is available here.
On April 13, 2018, the Federal Circuit held that 35 USC 271(e) infringement applies for ANDA amendments including paragraph IV certification for later-issued patent. Vanda Pharma. Inc. v. West-Ward Pharma. Int'l Ltd., No. 16-2707 (Fed. Cir. Apr. 13, 2018). Vanda owns '610 patent for schizophrenia treatment using iloperidone and has an exclusive license to expired '198 patent which covers the iloperidone compound. Vanda owns a NDA for antipsychotic drug Fanapt (iloperidone) and West-Ward filed an ANDA before '610 issued or was listed in the Orange Book. Vanda sued West-Ward for infringement of '198 patent. After '610 patent issued, Vanda sued for infringement of '610 patent and then Vanda listed '610 patent in the Orange Book. West-Ward amended its ANDA to contain para IV certification that '610 patent is invalid and/or not infringed and sent Vanda the para IV notice re '610 patent. The district consolidated the two lawsuits and found that West-Ward's submission of para IV certification for '610 patent was an act of infringement.
On appeal, the Federal Circuit, in a split decision, held that amending the ANDA by submitting a para IV certification is an act of infringement under the Hatch-Waxman act even if the patent issued after the ANDA filing but before FDA approval. The majority reasoned that the legislative history supports the conclusion that "application," as referred to in Section 271(e)(2)(A), includes ANDA amendments.
Full text of the opinion is available here.
On Feb. 8, 2018, the Federal Circuit held that the question of whether certain claim limitations represent well-understood, routine, conventional activity is a question of fact. Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018). In Berkheimer, invention relates to digitally processing and archiving files in a digital asset management system. The specification explains that the system eliminates redundant storage of common text and graphical elements, which improves efficiency and reduces storage costs. The Federal Circuit held that the claims are directed to abstract ideas but claims 4-7 contain limitations directed to purported improvements described in the specification, which raises genuine issues of material fact as to whether the purported improvements are more than well-understood, routine, conventional activity previously known in the industry. The court reversed the lower court's summary judgment as to claims 4-7 and remanded for further fact finding as to the eligibility of those claims; the court however held claims 1-3 and 9 to be ineligible because they did not include limitations that realize the purported improvements. In its ruling, the court cautioned that the mere fact that something is disclosed in the prior art does not mean it was well-understood, routine, conventional activity or element.
Full text of the opinion is available here.
Disclaimer: The content in this blog is solely for informational purposes and does not constitute legal advice.