IP Law Bulletin

As the 2018-2019 Supreme Court term nears its end, several consequential patent law petitions still await certiorari rulings before the Justices recess for the summer, while other patent cases are scheduled to be briefed and ready for oral argument when the Court reconvenes for a new term in October. To mark the end of this term, here’s a list of 5 Patent Law Petitions to Watch at the Supreme Court as we look ahead to 2019-2020.

Pat Concannon and John Loughnane, partners in Nutter’s Intellectual Property and Corporate and Transactions Departments, respectively, analyzed the significance of the upcoming oral arguments in the Supreme Court case Mission Product Holdings, Inc. v. Tempnology, LLC.

In the Q&A, “Mission Product Holdings, Inc. v. Tempnology, LLC: Will the Supreme Court Clarify the Rights of Trademark Licensees Upon Rejection?,” Pat and John discussed why there is such great uncertainty on this issue, leading to widely different results among the lower courts; how licensees can protect themselves if a licensor files for bankruptcy; and what they predict will happen in the Tempnology case. According to Pat and John, when licensing trademark rights, you need to think about a host of issues at the outset including the impact of a licensor declaring bankruptcy.

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On January 22, the Supreme Court clarified an important issue of patent law that had been left open since the enactment of the America Invents Act several years ago. 

The patent laws bar a person from receiving a patent on an invention that was “on sale” before the effective filing date of the patent application claiming that invention. The Supreme Court had previously announced that the “on sale bar” came into effect when the invention was “the subject of a commercial offer for sale” and was “ready for patenting”—that is, it must be sufficiently developed that a patent application could be filed, and there must be a commercial offer for sale. If these conditions are met, the offer can bar a subsequent patent application. The appeals court confirmed that this is true even when the offer for sale was confidential. 

The Federal Circuit rejected the patent venue test recently established by Judge Rodney Gilstrap of the Eastern District of Texas, the judge who has been reported to preside over about one quarter of all patent infringement cases in America. The three judge panel held that Judge Gilstrap abused his discretion and applied an incorrect legal standard in Raytheon Co. v. Cray Inc. when he refused to transfer the patent suit after applying his own four-factor test and determined defendant Cray maintained “a regular and established place of business” in the district where only one of its employees worked from home. As a result of its findings, the Federal Circuit ordered the case to be transferred.

On June 12, 2017, the U.S. Supreme Court granted certiorari in Oil States Energy Services LLC v. Greene’s Energy Group, LLC to decide whether the AIA (America Invents Act) patent review program for challenging the validity of issued patents is constitutional. Specifically, the Court will decide the question of “whether inter partes review – an adversarial process used by the Patent and Trademark Office (PTO) to analyze the validity of existing patents – violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.”

The Supreme Court held in Matal v. Tam that the Lanham Act’s provision forbidding the registration of disparaging trademarks is unconstitutional in violation of the First Amendment. The Court explained that “[s]peech may not be banned on the ground that it expresses ideas that offend.”

According to a recent Supreme Court decision, when it comes to the applicability of patent exhaustion, “restrictions and location are irrelevant; what matters is the patentee’s decision to make a sale.” In Impression Products, Inc. v. Lexmark International, Inc., the Supreme Court confirmed that the authorized sale of a patented article by a patentee exhausts all patent rights in that article, even where the patentee and the buyer agree to post-sale restrictions on the use and resale of the article. The Court also held that the authorized sale of a patented product abroad triggers patent exhaustion, just as a sale in the U.S. does.

On May 22, the U.S. Supreme Court issued an important and long-awaited Opinion in TC Heartland LLC v. Kraft Foods Group Brands LLC, a case that centered on where a patent infringement suit can be filed. In a resounding 8-0 decision, the Supreme Court put an abrupt end to the decades-old practice of forum shopping in patent cases.

For almost 30 years, patent venue law allowed patent owners to file infringement suits in federal judicial districts in which the accused infringer is subject to the district court’s personal jurisdiction. This flexibility opened the doors to a patent owner’s home court and to distant courts that are perceived to be friendly to patent owners. Observers believe that this flexibility was being abused, especially by non-practicing entities or “patent trolls.” Non-practicing entities generate revenue by licensing and enforcing their patents as opposed to making or selling their own products.

On February 22, 2017, the U.S. Supreme Court addressed the issue of whether the supply of a single component of a multicomponent invention qualifies as an infringing act under 35 USC §271(f)(1) of the U.S. Patent Act. In its decision in Life Technologies Corp. v. Promega Corp., the Court found that “a single component does not constitute a substantial portion of the components that can give rise to liability under §271(f)(1).” In doing so, the Court overturned the Federal Circuit’s prior holding that a single component could be sufficiently important to the invention to meet the criteria for being a “substantial portion.”

The United States Supreme Court today overturned a $400 million verdict in a highly-publicized and long-waged patent battle between Apple and Samsung. Samsung Elcs. Co., Ltd. v. Apple Inc., 580 U.S. __ (Dec. 6, 2016). In doing so, it addressed design patents for the first time in 130 years and held that damages in design patent cases do not necessarily need to be based upon the profits made from a whole end product sold to a consumer, but may be limited to a component of that product. Nonetheless, the Court’s unanimous opinion, penned by Justice Sotomayor, may raise more questions than it answers.