IP Law Bulletin

A party can raise lack of subject-matter jurisdiction at any time during a litigation. Illustrating this point, recently in Joao Control & Monitoring Systems, LLC v. Telular Corporation a patentee saved its unasserted patent claims from the Court’s invalidity order by arguing that the Court lacked subject matter jurisdiction over the unasserted claims.

In 2014, Joao Control & Monitoring Systems, LLC sued Telular Corporation for allegedly infringing two patents related to systems for remotely monitoring property. Joao’s complaint asserted that Telular infringed one or more claims from each patent, but did not identify any specific claims. Telular counterclaimed for declaratory judgment of invalidity for both patents.

Defendants in patent litigation frequently mount an invalidity defense under 35 U.S.C. § 101 by arguing that asserted claims are directed to abstract ideas, which are not eligible for patent protection under the first step of the Alice^[1] test. Often, these defendants fail to account for significant aspects of the asserted claims, resulting in an oversimplification that doesn’t accurately articulate what the claims are actually directed to. This was precisely the government’s error in Thales Visionix Inc. v. United States (Fed. Cir. 2017), where the Federal Circuit found, contrary to the government’s characterization of the claims (which the Claims Court adopted), the asserted claims were not directed to an abstract idea.

In Zircore, LLC v. Straumann Manufacturing, Inc. (E.D. Tex. 2017), as in many patent litigations since Mayo, Myriad, and Alice, the defendant moved to dismiss the infringement allegations contending that the patents in suit are ineligible subject matter under 35 USC § 101. Here, despite Straumann’s assertion that Zircore’s U.S. Patent No. 7,967,606 was invalid under § 101 as directed to an abstract idea, the court found that the claims were patent eligible under § 101 as directed to a method of manufacturing a physical object.

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.

Last week the Federal Circuit denied Sequenom’s petition for rehearing en banc to review patent eligibility of their cell-free fetal DNA patent, U.S. Pat. No 6,258,540 (the ’540 Patent).  The District Court found the ’540 Patent invalid under 35 U.S.C. § 101 for being directed to ineligible subject matter under the U.S. Supreme Court precedent in Mayo v. Prometheus Laboratories, 132 S. Ct. 1298 (2012). The Federal Circuit affirmed and Sequenom filed the petition for rehearing en banc.

On August 28 and September 15, 2015, certain asserted claims of Exergen’s United States Patent No. 7,787,938 (the "'938 patent") were found invalid under 35 U.S.C. § 101 on two separate summary judgment motions. See Exergen Corp. v. Brooklands Inc. ("Brooklands"), No. 12-cv-12243-DPW (August 28, 2015) and Exergen Corp. v. Thermomedics, Inc. ("Thermomedics"), No. 13-cv-11243-DJC (September 15, 2015). The claims of the '938 patent at issue are directed to diagnostic methods for measuring body temperature based upon radiation and temperature measurements taken at the temporal artery at the side of the forehead. Readers, particularly with children, will recognize the Exergen thermometer as a popular tool for taking kids’ temperatures.

Arguing that its invalidated diagnostic patent claims were “collateral damage in what is properly a war on frivolously broad claims directed to things like correlation tables and actual strands of human DNA,” on August 13, 2015, Sequenom petitioned the Federal Circuit for an en banc review of its June 12 holding in Ariosa Diagnostics, Inc. v. Sequenom, Inc. In that strikingly sweeping decision, a Federal Circuit panel invalidated U.S. Patent 6,258,540 (the ’540 patent) as being directed to ineligible subject matter. Sequenom now warns that the panel decision “reads recent Supreme Court precedent to create an existential threat to patent protection for an array of meritorious inventions” beyond those in the personalized medicine and diagnostics industries:

If this Court does not step in and draw this line, the panel’s rule threatens to swallow many more meritorious inventions along with this one. The core of nearly every major innovation is the discovery of a fact about the natural world that motivates inventors to combine existing techniques to achieve new practical results.