IP Law Bulletin

“Infringement, whether direct or contributory, is essentially a tort,

and implies invasion of some right of the patentee.”

Louis D. Brandeis took his seat on the bench of the United States Supreme Court for the first time on Monday, October 9, 1916. That opening day of the new term included the swearing in of Associate Justice John H. Clark and oral argument on several motions. It also marked the beginning of Justice Brandeis’s twenty-three-year tenure (1916-1939) on the high court, which is now considered one of the most important in American jurisprudence. Justice Brandeis was not only the first Jewish jurist to sit on the Supreme Court, but he impressed upon his colleagues that the law had to reflect economic and societal realities. In essence, he brought the principles that guided him in the practice of law to the bench.

Nutter was co-founded by Justice Brandeis in 1879 and his legacy continues as a source of pride and inspiration for us today. To honor the hundredth anniversary of Justice Brandeis’s first session, we have summarized several of the patent opinions he authored below.

The Federal Circuit last week handed down the latest in a series of decisions finding computer-implemented inventions to be patent-eligible under 35 U.S.C. § 101. In McRO, Inc. v. Bandai Namco Games America, Inc. et al. (Fed. Cir. Sept. 13, 2016), the Federal Circuit held that claims directed to software for automatically animating lip synchronization and facial expressions of animated characters were not directed to an abstract idea under the first prong of the Alice test, and therefore recited patent-eligible subject matter. McRO joins a growing list of Federal Circuit cases that find computer-implemented inventions to be non-abstract, including DDR Holdings, Enfish, and BASCOM.

Almost a decade has elapsed since the Supreme Court’s decision in KSR Int’l Co. v. Teleflex, Inc. altered the law of patent obviousness. In reversing the judgment of the Federal Circuit, the Court in KSR limited the “teaching, suggestion, motivation” test and loosened the standards that both courts and the USPTO use to assess validity under 35 U.S.C. § 103. In particular, the Court expressly rejected the application of any inflexible obviousness rule that excluded consideration of, among other things, common sense.

The Federal Circuit, however, recently confirmed that common sense alone cannot suffice to establish obviousness. In Arendi S.A.R.L. v. Apple, Inc., the court held that the Patent Trial and Appeal Board (the PTAB) erred when it used common sense to supply a missing limitation in the prior art to arrive at the claimed invention. Not only is this case surprising in that factual findings of the PTAB are rarely overturned on appeal, but it also marks some constraints on the broad obviousness standard articulated in KSR.

The Post-Prosecution Pilot Program, dubbed “P3” by the United States Patent and Trademark Office (USPTO), offers applicants a new, and arguably improved, path through the after-final landscape. P3 provides applicants the opportunity to orally present proposed amendments or arguments to a panel of examiners after a final rejection has been issued but before filing a notice of appeal. As the USPTO’s latest rollout under the Enhanced Patent Quality Initiative, P3 incorporates effective features of the existing Pre-Appeal Brief Conference Pilot program (Pre-Appeal) and the After Final Consideration Pilot 2.0 program (AFCP). Applicants should consider taking advantage of this no-fee program to make their case for allowance, propose non-broadening amendments, and receive feedback from a larger pool of examiners prior to filling a notice of appeal or Request for Continued Examination (RCE).

CardiAQ Valve Techs., Inc. v. Neovasc Inc., No. 14-CV-12405-ADB, 2016 WL 1642573 (D. Mass. Apr. 25, 2016)

Neovasc began its business relationship with CardiAQ in June, 2009, by providing services and supplies for the development of CardiAQ’s TMVI heart valve device. Though the relationship lasted only 10 months, the parties exchanged hundreds of technical emails and had regular calls during that period. The parties met again in court when CardiAQ sued Neovasc in the District of Massachusetts before Judge Burroughs claiming, among other things, that Neovasc’s employees surreptitiously used CardiAQ’s confidential information to develop a competing valve device and to patent a related method.

In another decision applying the two-step framework for determining patent eligible subject matter laid out in Alice Corp. v. CLS Bank International, the U.S. Court of Appeals for the Federal Circuit addressed the patent eligibility of claims to an Internet content filtering system. In BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC, the Federal Circuit held that BASCOM’s U.S. Patent 5,987,606 (“the ‘606 patent) was not invalid as a matter of law, vacated a district court’s order to dismiss, and remanded for further proceedings.

An old adage states that an infinite number of monkeys typing for an infinite amount of time will surely produce Shakespeare’s Hamlet. In a similar vein, the web site All Prior Art seeks to use computers and algorithms to create prior art. All Prior Art uses the existing U.S. patent database as source materials to create new “prior art.” The web site then publishes these new ideas under the Create Commons License, meaning the ideas are effectively dedicated to the public. While the algorithm is able to generate approximately 36,000 ideas a minute, the overwhelming majority are pure gibberish.

Yesterday, the U.S. Supreme Court issued a decision in the case of Halo Electronics, Inc. v. Pulse Electronics, Inc., once again changing patent law by loosening the standard by which district courts may award enhanced damages under 35 U.S.C. § 284. In so doing, the Court discarded the two-part test set forth by the Court of Appeals for the Federal Circuit in In re Seagate Technology, LLC, 497 F.3d 1360 (Fed. Cir. 2007). The so-called Seagate test first requires that the patentee show by clear and convincing evidence that an infringer’s actions were objectively unreasonable. If this burden is met, the patentee must then prove that the infringer subjectively knew or should have known that its actions risked infringing a valid patent. If a patent holder is able to meet both prongs of the test, any enhancement of damages is subject to the discretion of the district court. Appellate review of such determinations involves a tripartite standard, in which the determination of objective recklessness is reviewed de novo, the determination of subjective knowledge is reviewed for substantial evidence, and any award of enhanced damages is reviewed for abuse of discretion.

In view of the U.S. Supreme Court’s decisions in Alice, Myriad, and Mayo, the United States Patent and Trademark Office (USPTO) has issued a series of guidance documents on patent subject matter eligibility under 35 U.S.C. § 101. These documents are collected on the Subject Matter Eligibility page of the USPTO website. The USPTO’s “May 2016 Subject Matter Eligibility Update” (88 Fed. Reg. 27381), announced the newest in this series of guidance, including new life science examples, a memorandum to the patent examining corps with instructions on formulating subject matter eligibility rejections, an index of eligibility examples, and an appendix of subject matter eligibility court decisions.

Earlier this month, the Federal Circuit revisited the issue of inventorship disputes and iterated in a nonprecedential opinion that proving nonjoinder of inventors in an issued patent is a difficult threshold for a challenger to meet. In doing so, the Federal Circuit affirmed the district court holding that the challenge to correct inventorship of two issued patents was not supported by evidence that rose to the “clear and convincing” standard required to prevail on a 35 U.S.C. § 256 claim.