IP Law Bulletin

The Leahy-Smith America Invents Act (AIA) introduced a number of important changes to U.S. patent law. Many of the provisions in the AIA do not apply to patent applications that have an effective filing date prior to March 16, 2013 (pre-AIA applications). For a number of reasons that have been well documented, it can be desirable to preserve an application’s status as a pre-AIA application.

On the same day in early June, the United States Supreme Court issued two opinions addressing patent law issues related to inducement and indefiniteness —Limelight Networks, Inc. v. Akamai Technologies, Inc. and Nautilus, Inc. v. Biosig Instruments, Inc., respectively. In both cases, the nation’s highest court unanimously reversed the Federal Circuit. In doing so, the Court simultaneously raised the bar for patentees with respect to patent infringement and lowered the bar for alleged infringers with respect to invalidity. The decision provides a salient reminder of some important claim drafting strategies for current and future patent applicants.

Active Inducement of Infringement

The Patent Act provides that “[w]hoever actively induces infringement of a patent shall be liable as an infringer.” In Limelight, the accused infringer Limelight Networks, Inc., was alleged to have actively induced infringement of a method patent by carrying out some steps of the claimed method and encouraging its customers to carry out the remaining steps. For purposes of this case, the Supreme Court assumed that infringement of all the method steps could not be attributable to a single party, either because Limelight had not actually performed the steps or because it did not direct or control others who performed them. Accordingly, the Supreme Court reversed the Federal Circuit’s decision and found that Limelight could not be liable for active inducement of infringement. In doing so, it reinstated the principle that liability for induced infringement must be predicated on direct infringement. The Court, however, made specific note that the Federal Circuit on remand will have the opportunity to revisit the question of direct infringement by Limelight under 35 U.S.C. § 271(a). For the time being, however, Limelight has escaped a finding of liability by dividing the performance of method steps between more than one party.

Indefiniteness

In addition to reversing the Federal Circuit’s holding concerning active inducement of infringement, the Court in Nautilus set forth a new test for patent definiteness when considering validity of a patent claim in view of 35 U.S.C. § 112. In particular, the Court held that “a patent is invalid for indefiniteness if its claims, read in light of the specification delineating the patent, and the prosecution history, fail to inform, with reasonable certainty, those skilled in the art about the scope of the invention.” This new standard replaces the Federal Circuit’s long-standing “insolubly ambiguous” test, which directed lower courts to invalidate claims only if they are not “amenable to construction,” meaning that claims should survive so long as a court could “ascribe some meaning” to them. In overturning that standard, the Supreme Court found that it “can leave courts and the patent bar at sea without a reliable compass.”

Because the Court remanded the case back to the Federal Circuit with the instruction to apply the new standard to the claims at issue, the application and breadth of the newly pronounced indefiniteness standard are uncertain. While the Court found that the old standard was too lenient toward ambiguous claims, it cautioned that “[s]ection 112…entails a ‘delicate balance’” that “must take into account the inherent limitations of language,” and allow for “[s]ome modicum of uncertainty,” while also requiring claims to “be precise enough to afford clear notion of what is claimed.” The Court also pointed out the importance of viewing the claims from the point of view of a person skilled in the art, and that such an investigation “may turn on evaluations of expert testimony.” Thus, the new standard appeals to a rule of reason, and its application likely will involve an intense factual investigation. In addition, the Court restricted its holding to the 2006 version of the Patent Act, which was in effect prior to enactment of the Leahy-Smith America Invents Act in 2012. It will thus be left to future cases to determine whether the Supreme Court’s new standard will be applied to patents filed after September 16, 2012.

Claim Drafting

Even with the uncertainty surrounding indefiniteness, patent applicants can employ certain claim drafting strategies to protect their interests in view of Limelight and Nautilus. For example, to circumvent the divided infringement issue in view of Limelight, method claim language can be drafted from the perspective of a single actor that practices all of the steps of the claimed process. While this can in some cases be more difficult and awkward, claims that focus on the behavior of one actor are more likely to hold up in infringement litigation and afford patentees the greatest likelihood of protection.

Further, while the exact meaning of the new “reasonable certainty” standard for claim definiteness is unknown, it seems evident that a greater level of clarity in describing the scope of an invention will be required going forward. For example, certain claim limitations based on inherent characteristics and functional language may not be sufficient to satisfy definiteness under 35 U.S.C. § 112 after Nautilus. To guard against this possibility while retaining the broadest coverage, applicants should ensure that their specification includes broad disclosure along with more specific examples of the embodiments of the invention. Applicants should also be sure to draft claims in the same manner, e.g., by including broader functional language in an independent claim and more specific limitations in dependent claims. Under such a strategy, the invention can remain protected under the new standard by the narrower claims even if the broader claims are deemed indefinite.

While these strategies themselves are not novel, their importance is highlighted by the Supreme Court’s recent decisions.

This update was prepared by Nutter's Intellectual Property practice. For more information, please contact your Nutter attorney at 617.439.2000.

This update is for information purposes only and should not be construed as legal advice on any specific facts or circumstances. Under the rules of the Supreme Judicial Court of Massachusetts, this material may be considered as advertising.

Despite being dismissed by the Federal Circuit before reaching its highly anticipated substantive issues regarding patent eligibility, the ruling in Consumer Watchdog v. Wisconsin Alumni Research Foundation nonetheless significantly alters the patent litigation landscape. Consumer Watchdog (CW), a nonprofit waging a seven-year campaign to invalidate the Wisconsin Alumni Research Foundation (WARF) stem cell patent, saw its battle come to an abrupt end when the Federal Circuit held that it did not have an injury in fact sufficient to confer Article III standing to appeal a United States Patent and Trademark Office (USPTO) decision in federal court. The ruling limits the reach of the statute permitting appeals of USPTO rulings to the constitutional boundaries set by Article III, leaving some third-party challengers stuck with the USPTO as their only available forum.

The article in our May edition of the IP Bulletin addressed four of the eight most commonly asked questions that arise when completing a U.S. trademark application filing. More particularly, we considered the trademark application form that should be used, the classes of goods or services to include in the application, the items included in the description of goods and services, and appropriate and acceptable specimen of use to be included as part of the application. The other four most commonly asked questions are tackled in this article, including: (5) should I include color or design features as part of my trademark application; (6) what is my filing basis; (7) what is my date of first use; and (8) what other considerations should I be making when preparing my U.S. trademark application?

In late June, the United States Supreme Court issued a long-awaited decision in Alice Corporation Pty. Ltd. v. CLS Bank International that may have broad-reaching implications on patenting software. At issue in the case was whether claims to a computer-implemented system and method for mitigating “settlement risk” in financial transactions are eligible for patenting under 35 U.S.C. § 101. In a unanimous decision, the Court held that the claims were directed to an abstract idea and, although implemented on a computer, were not patentable.

Prior to March 2, 2010, the law was well settled that in order to enforce a copyright in court, the party bringing the claim must have a registration. Copyright standing is governed by Section 411(a) of the Copyright Act of 1976, which states that “no civil action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made in accordance with this title.” Accordingly, copyright infringement lawsuits would be dismissed for lack of subject matter jurisdiction if the plaintiff did not have a registration.