**Patent Law** William Fisher (2020.01.13)
Nationalism
if the inventive activity stimulated by the patent regime occurs outside the country, the country reaps fewer social benefits while bearing all the social harms
“Nationals of any country of the Union shall, as regards the protection of industrial property, enjoy in all the other countries of the Union the advantages that their respective laws now grant, or may hereafter grant, to nationals; all without prejudice to the rights specially provided for by this Convention. Consequently, they shall have the same protection as the latter, and the same legal remedy against any infringement of their rights, provided that the conditions and formalities imposed upon nationals are complied with.”
(1) Any person who has duly filed an application for a patent, or for the registration of a utility model, or of an industrial design, or of a trademark, in one of the countries of the Union, or his successor in title, shall enjoy, for the purpose of filing in the other countries, a right of priority during the periods hereinafter fixed.
(2) Any filing that is equivalent to a regular national filing under the domestic legislation of any country of the Union or under bilateral or multilateral treaties concluded between countries of the Union shall be recognized as giving rise to the right of priority.
(3) By a regular national filing is meant any filing that is adequate to establish the date on which the application was filed in the country concerned, whatever may be the subsequent fate of the application.
The periods of priority referred to above shall be twelve months for patents and utility models, and six months for industrial designs and trademarks.
“(5) Patents obtained with the benefit of priority shall, in the various countries of the Union, have a duration equal to that which they would have, had they been applied for or granted without the benefit of priority.”
Can invoke this procedure iff claims in American application are supported by prior foreign application to extent required by 112
No limits on the grant of CLs in the public interest
~ designated national patent offices
currently the national offices of: Australia; Austria; Brazil; Canada; China; Finland; Sweden; Japan; Republic of Korea; Russian Federation; Spain; USA; the international office of “Nordic Patent Institute” (Denmark/Iceland/Norway); and the European Patent Office
+ - (1) Leaders of less developed countries saw increased IP protections as beneficial for them in the long run -- and used the WTO as a vehicle to outflank parochial local pirate industries
~ Edmund W. Kitch,
The Patent Policy of Developing Countries,
13 UCLA Pac. Basin L.J. 166 (1994)
Interpretation undermined by World Bank report concluding that, thus far, developing countries have been disadvantaged
+ - (2) Less developed countries rationally traded obligation to increase IP protections for (a) increased opportunities to export agricultural products and textiles and (b) protection from unilateral sanctions by USA
+ - (3) Developed countries forced less developed countries to accept IP rules not in their best interest
The leaders of major industries (Hollywood and PHARMA) successfully used the GATT process to advance their own interests
Susan K. Sell, Private Power, Public Law:
The Globalization of Intellectual Property
Rights (2003)
(4) Developed countries duped less developed countries into accepting IP rules not in their best interest
~ Membership determined by the Committee for Development of the United Nations
~ Currently 47 such countries, 36 of which are members of the WTO
Deadline for compliance with TRIPS recently extended to 2021 for most issues; 2033 for pharmaceuticals (or until a country escapes the category of “least developed”)
“With regard to the protection of intellectual property, any advantage, favour, privilege or immunity granted by a Member to the nationals of any other country shall be accorded immediately and unconditionally to the nationals of all other Members” – 4
+ - Limited exceptions
Exempted from this obligation are any advantage, favour, privilege or immunity accorded by a Member:
(a) deriving from international agreements on judicial assistance or law enforcement of a general nature and not particularly confined to the protection of intellectual property;
(b) granted in accordance with the provisions of the Berne Convention (1971) or the Rome Convention authorizing that the treatment accorded be a function not of national treatment but of the treatment accorded in another country;
(c) in respect of the rights of performers, producers of phonograms and broadcasting organizations not provided under this Agreement;
(d) deriving from international agreements related to the protection of intellectual property which entered into force prior to the entry into force of the WTO Agreement, provided that such agreements are notified to the Council for TRIPS and do not constitute an arbitrary or unjustifiable discrimination against nationals of other Members.
“Patent rights [shall be] enjoyable without discrimination as to … whether products are imported or locally produced”
Possible Interpretations:
(a) ban all “working” obligations
(b) compulsory licenses are permitted if they do not treat differently imported and locally produced products
commentary
“inventions, the prevention within their territory of the commercial exploitation of which is necessary to protect ordre public or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment” – 27.2
“diagnostic, therapeutic and surgical methods for the treatment of humans or animals” – 27.3
+ - “plants and animals other than micro-organisms” & biological [not microbiological] processes for the production thereof – 27.3
Products: “to prevent third parties not having the owner's consent from the acts of: making, using, offering for sale, selling, or importing” – 28.1(a)
Processes: “to prevent third parties not having the owner's consent from the act of using the process, and from the acts of: using, offering for sale, selling, or importing for these purposes at least the product obtained directly by that process” – 28.1(b)
Rights to assign and license – 28.2
+ - Exceptions
+ -
“Limited” exceptions to exclusive rights
permissible only if they “do not unreasonably
conflict with a normal exploitation of the
patent and do not unreasonably prejudice
the legitimate interests of the patent owner,
taking account of the legitimate interests
of third parties” – 30
+ - Possible examples
Each Member has the right to grant compulsory licences and the freedom to determine the grounds upon which such licences are granted.
Doha Declaration (11/14/2001), 5(b).
Each Member has the right to determine what constitutes a national emergency or other circumstances of extreme urgency, it being understood that public health crises, including those relating to HIV/AIDS, tuberculosis, malaria and other epidemics, can represent a national emergency or other circumstances of extreme urgency. Doha Declaration (11/14/2001), 5(c)
+ - Members are not obliged to apply the conditions set forth in subparagraphs (b) and (f) where such use is permitted to remedy a practice determined after judicial or administrative process to be anti-competitive.
+ - Used by Competition Commission of South Africa to provoke issuance of "voluntary" licenses to generic companies for HIV cocktails (December 2003)
The need to correct anti-competitive practices may be taken into account in determining the amount of remuneration in such cases.
Competent authorities shall have the authority to refuse termination of authorization if and when the conditions which led to such authorization are likely to recur
"The term of protection available shall not end before the expiration of a period of twenty years counted from the filing date"
“necessary to protect ordre public or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment”
medical procedures
plants
"For the purposes of dispute settlement under this Agreement, subject to the provisions of Articles 3 and 4 nothing in this Agreement shall be used to address the issue of the exhaustion of intellectual property rights."
critical because of the discretion it leaves countries with respect to opportunities for geographic price discrimination
soon after TRIPS, US and EU began negotiating bilateral and regional agreements with stricter IP obligations
impediments to further tightening of IP regime through WTO (e.g., Cancun 2003) has led to increased reliance on this approach
1. Subject to paragraphs 2 and 3, each Party shall make patents available for any inventions, whether products or processes, in all fields of technology, provided that such inventions are new, result from an inventive step and are capable of industrial application. For purposes of this Article, a Party may deem the terms "inventive step" and "capable of industrial application" to be synonymous with the terms "non-obvious" and "useful", respectively.
2. A Party may exclude from patentability inventions if preventing in its territory the commercial exploitation of the inventions is necessary to protect ordre public or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to nature or the environment, provided that the exclusion is not based solely on the ground that the Party prohibits commercial exploitation in its territory of the subject matter of the patent.
+ - 3. A Party may also exclude from patentability:
1 (a) diagnostic, therapeutic and surgical methods for the treatment of humans or animals;
+ - (b) plants and animals other than microorganisms; and
Notwithstanding subparagraph (b), each Party shall provide for the protection of plant varieties through patents, an effective scheme of *sui generis* protection, or both.
(c) essentially biological processes for the production of plants or animals, other than non-biological and microbiological processes for such production.
+ - 4. If a Party has not made available product patent protection for pharmaceutical or agricultural chemicals commensurate with paragraph 1:
1 (a) as of January 1, 1992, for subject matter that relates to naturally occurring substances prepared or produced by, or significantly derived from, microbiological processes and intended for food or medicine, and
(b) as of July 1, 1991, for any other subject matter,
that Party shall provide to the inventor of any such product or its assignee the means to obtain product patent protection for such product for the unexpired term of the patent for such product granted in another Party, as long as the product has not been marketed in the Party providing protection under this paragraph and the person seeking such protection makes a timely request.
+ - 5. Each Party shall provide that:
1 (a) where the subject matter of a patent is a product, the patent shall confer on the patent owner the right to prevent other persons from making, using or selling the subject matter of the patent, without the patent owner's consent; and
(b) where the subject matter of a patent is a process, the patent shall confer on the patent owner the right to prevent other persons from using that process and from using, selling, or importing at least the product obtained directly by that process, without the patent owner's consent.
6. A Party may provide limited exceptions to the exclusive rights conferred by a patent, provided that such exceptions do not unreasonably conflict with a normal exploitation of the patent and do not unreasonably prejudice the legitimate interests of the patent owner, taking into account the legitimate interests of other persons.
7. Subject to paragraphs 2 and 3, patents shall be available and patent rights enjoyable without discrimination as to the field of technology, the territory of the Party where the invention was made and whether products are imported or locally produced.
+ - 8. A Party may revoke a patent only when:
9. Each Party shall permit patent owners to assign and transfer by succession their patents, and to conclude licensing contracts.
+ - 10. Where the law of a Party allows for use of the subject matter of a patent, other than that use allowed under paragraph 6, without the authorization of the right holder, including use by the government or other persons authorized by the government, the Party shall respect the following provisions:
1 (a) authorization of such use shall be considered on its individual merits;
(b) such use may only be permitted if, prior to such use, the proposed user has made efforts to obtain authorization from the right holder on reasonable commercial terms and conditions and such efforts have not been successful within a reasonable period of time. The requirement to make such efforts may be waived by a Party in the case of a national emergency or other circumstances of extreme urgency or in cases of public non-commercial use. In situations of national emergency or other circumstances of extreme urgency, the right holder shall, nevertheless, be notified as soon as reasonably practicable. In the case of public non-commercial use, where the government or contractor, without making a patent search, knows or has demonstrable grounds to know that a valid patent is or will be used by or for the government, the right holder shall be informed promptly;
(c) the scope and duration of such use shall be limited to the purpose for which it was authorized;
(d) such use shall be non-exclusive;
(e) such use shall be non-assignable, except with that part of the enterprise or goodwill that enjoys such use;
(f) any such use shall be authorized predominantly for the supply of the Party's domestic market;
(g) authorization for such use shall be liable, subject to adequate protection of the legitimate interests of the persons so authorized, to be terminated if and when the circumstances that led to it cease to exist and are unlikely to recur. The competent authority shall have the authority to review, on motivated request, the continued existence of these circumstances;
(h) the right holder shall be paid adequate remuneration in the circumstances of each case, taking into account the economic value of the authorization;
(i) the legal validity of any decision relating to the authorization shall be subject to judicial or other independent review by a distinct higher authority;
(j) any decision relating to the remuneration provided in respect of such use shall be subject to judicial or other independent review by a distinct higher authority;
(k) the Party shall not be obliged to apply the conditions set out in subparagraphs (b) and (f) where such use is permitted to remedy a practice determined after judicial or administrative process to be anticompetitive. The need to correct anticompetitive practices may be taken into account in determining the amount of remuneration in such cases. Competent authorities shall have the authority to refuse termination of authorization if and when the conditions that led to such authorization are likely to recur;
(l) the Party shall not authorize the use of the subject matter of a patent to permit the exploitation of another patent except as a remedy for an adjudicated violation of domestic laws regarding anticompetitive practices.
+ - 11. Where the subject matter of a patent is a process for obtaining a product, each Party shall, in any infringement proceeding, place on the defendant the burden of establishing that the allegedly infringing product was made by a process other than the patented process in one of the following situations:
1 (a) the product obtained by the patented process is new; or
(b) a substantial likelihood exists that the allegedly infringing product was made by the process and the patent owner has been unable through reasonable efforts to determine the process actually used.
In the gathering and evaluation of evidence, the legitimate interests of the defendant in protecting its trade secrets shall be taken into account.
12. Each Party shall provide a term of protection for patents of at least 20 years from the date of filing or 17 years from the date of grant. A Party may extend the term of patent protection, in appropriate cases, to compensate for delays caused by regulatory approval processes.
movement toward a European and EU Patents Court (EEUPC), which would have exclusive jurisdiction over EU and the European patents
+ - subset of EU countries hoping to offer a patent applicable in them all, without the costs of translation
UK, Denmark, Estonia, Finland, France, Germany, Lithuania, Luxembourg, The Netherlands, Poland, Slovenia and Sweden
opposition by Spain and Italy
Not a major reform; essentially cost-reduction strategy
+ - Status
procedure: "enhanced cooperation mechanism"
approved by committee of Parliament, Jan. 31, 2011
Parliament approves
March 2011: ECJ rejects it as not adapted to EU law
Granted by the EPO
Instead of multiple national patents, enforceable only in national courts, it will be a single patent, enforceable in all ratifying states (within the EU), enforceable in a single new Unified Patent Court
Patents have socially undesirable side effects; they should be used only when essential to stimulate innovative activity that otherwise would not occur
+ - e.g., Senator Frist, justifying 35 USC 287(c)
The rights conferred by a patent should be proportional to the effort that went into it and/or to the benefit it confers on society
+ - e.g., DDR Holdings (CAFC 2014) (Mayer dissenting)
“ The potential scope of DDR's patents is staggering, arguably covering vast swaths of Internet commerce. DDR has already brought infringement actions against ten defendants, including Digital River, Inc., Expedia, Inc., Travelocity.com, L.P., and Orbitz Worldwide, LLC. See J.A. 255-63; ante at 1250. _DDR's claims are patent ineligible because their broad and sweeping reach is vastly disproportionate to their minimal technological disclosure._ See Mayo, 132 S.Ct. at 1303 (In assessing patent eligibility, "the underlying functional concern ... is a relative one: how much future innovation is foreclosed relative to the contribution of the inventor.”).”
“We have “long held that this provision contains an important implicit exception[:] Laws of nature, natural phenomena, and abstract ideas are not patentable.” *Mayo*, (slip op., at 1) Rather, “‘they are the basic tools of scientific and technological work’” that lie beyond the domain of patent protection. As the Court has explained, without this exception, there would be considerable danger that the grant of patents would “tie up” the use of such tools and thereby “inhibit future innovation premised upon them.” This would be at odds with the very point of patents, which exist to promote creation.”
If lawmakers in country A think that firms in country A lead in technological development with respect to field X, then they should advocate extension of subject-matter coverage to inventions in field X, both domestically and internationally
If lawmakers in country A think that firms in country A do (and will) lag firms in other countries with respect to field X, then they should advocate elimination of subject-matter coverage to inventions in field X, both domestically and internationally
I swear to fulfill, to the best of my ability and judgment, this covenant:
**I will respect the hard-won scientific gains of those physicians in whose steps I walk, and gladly share such knowledge as is mine with those who are to follow.**
**I will apply, for the benefit of the sick, all measures [that] are required**, avoiding those twin traps of overtreatment and therapeutic nihilism.
I will remember that there is art to medicine as well as science, and that warmth, sympathy, and understanding may outweigh the surgeon's knife or the chemist's drug.
I will not be ashamed to say "I know not," nor will I fail to call in my colleagues when the skills of another are needed for a patient's recovery.
I will respect the privacy of my patients, for their problems are not disclosed to me that the world may know. Most especially must I tread with care in matters of life and death. If it is given me to save a life, all thanks. But it may also be within my power to take a life; this awesome responsibility must be faced with great humbleness and awareness of my own frailty. Above all, I must not play at God.
I will remember that I do not treat a fever chart, a cancerous growth, but a sick human being, whose illness may affect the person's family and economic stability. My responsibility includes these related problems, if I am to care adequately for the sick.
I will prevent disease whenever I can, for prevention is preferable to cure.
I will remember that I remain a member of society, with special obligations to all my fellow human beings, those sound of mind and body as well as the infirm.
If I do not violate this oath, may I enjoy life and art, respected while I live and remembered with affection thereafter. May I always act so as to preserve the finest traditions of my calling and may I long experience the joy of healing those who seek my help.
Users' control over the program requires four [<u>essential freedoms][1]</u>.
[1]: https://www.gnu.org/philosophy/free-sw.html
(0) The freedom to run the program as you wish, for whatever purpose.
(1) The freedom to study the program's “source code”, and change it, so the program does your computing as you wish. Programs are written by programmers in a programming language—like English combined with algebra—and that form of the program is the “source code”. Anyone who knows programming, and has the program in source code form, can read the source code, understand its functioning, and change it too. When all you get is the executable form, a series of numbers that are efficient for the computer to run but extremely hard for a human being to understand, understanding and changing the program in that form are forbiddingly hard.
(2) The freedom to make and distribute exact copies when you wish. (It is not an obligation; doing this is your choice. If the program is free, that doesn't mean someone has an obligation to offer you a copy, or that you have an obligation to offer him a copy. Distributing a program to users without freedom mistreats them; however, choosing not to distribute the program—using it privately—does not mistreat anyone.)
(3) The freedom to make and distribute copies of your modified versions, when you wish.
"The Congress shall have power … to promote the Progress of science and useful arts, by securing for limited times to authors and inventors, the exclusive right to their respective Writings and Discoveries"
Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”
Facts: “This human-made, genetically engineered bacterium is capable of breaking down multiple components of crude oil. Because of this property, which is possessed by no naturally occurring bacteria, Chakrabarty's invention is believed to have significant value for the treatment of oil spills.”
“The Committee Reports accompanying the 1952 Act inform us that Congress intended statutory subject matter to "include anything under the sun that is made by man." S.Rep.No.1979, 82d Cong., 2d Sess., 5 (1952); H.R.Rep.No.1923, 82d Cong., 2d Sess., 6 (1952).”
“[T]he patentee has produced a new bacterium with markedly different characteristics from any found in nature and one having the potential for significant utility. _His discovery is not nature's handiwork, but his own; accordingly it is patentable subject matter_.”
+ - Member states must provide protection for new, distinct, uniform, stable plant varieties
+ - ~ Exceptions (Arts. 15-16)
reproduction through grafting or other forms of asexual reproduction, or sale of asexually reproduced copies
n.a. to reproduction through seeds
+ - n.a. to independent invention
+ - as of the time of application, the variety has not been sold or given, by the breeder or with his consent, to anyone
+ - does this reach "innocent infringement"?
+ - ~ Cf. Schmeiser v. Monsanto (Canada 2002)
Schmeiser's replication of "Roundup Ready" canola was not innocent because he know or had reason to know of the patent
North Dakota statute: patentees must designate "independent laboratories" to test crops to determine patent infringement
“ Here, as in Myriad, Roslin "did not create or alter any of the genetic information" of its claimed clones, "[n]or did [Roslin] create or alter the genetic structure of [the] DNA" used to make its clones. Myriad, 133 S.Ct. at 2116. Instead, Roslin's chief innovation was the preservation of the donor DNA such that the clone is an exact copy of the mammal from which the somatic cell was taken. Such a copy is not eligible for patent protection.”
Stem cell patents challenged as inconsistent with EU Biotechnology Directive
Holding: An invention is excluded from
patentability if the process requires either
the prior destruction of human embryos or
their prior use as base material, even if the
application does not refer to the use of
human embryos. Furthermore, the CJEU
concluded that scientific research entailing the use of human embryos cannot
access the protection of patent law
“[E]ven if it were merely an extracted product without change, there is no rule that such products are not patentable. Takamine [the inventor] was the first to make it available for any use by removing it from the other gland-tissue in which it was found, and, while it is of course possible logically to call this a purification of the principle, **it became for every practical purpose a new thing commercially and therapeutically**. That was a good ground for a patent.” Parke-Davis & Co. v. H.K. Mulford Co., 189 F. 95, 103 (C.C.S.D.N.Y. 1911) (L. Hand)
~ Jon Harkness characterizes the decision as an “under-informed mistake”
Inventor discovers that certain strains of bacteria that help some plants remove nitrogen from the air do not interfere with one another
Inventor combines the strains into a single inoculant -- and seeks a patent on it
+ - Myriad Genetics
Myriad discovers and isolates two genes, mutations in which sharply increase the risk of breast and ovarian cancer
Myriad is granted product patents on both the naturally occurring sequences and the corresponding complementary DNS sequences (synthesized from the messenger RNA, which in turn is naturally generated by the DNA sequences)
although criticizes Judge Sweet's opinion, to the extent it suggested that even manipulated forms of genes are not patentable
“[A] naturally occurring DNA segment is a product of nature and not patent eligible merely because it has been isolated, but ... cDNA is patent eligible because it is not naturally occurring.”
+ - 1. “[G]enes and the information they encode are not patent eligible under §101 simply because they have been isolated from the surrounding genetic material.”
“Nor are Myriad’s claims saved by the fact that isolating DNA from the human genome severs chemical bonds and thereby creates a nonnaturally occurring molecule. Myriad’s claims are simply not expressed in terms of chemical composition, nor do they rely in any way on the chemical changes that result from the isolation of a particular section of DNA. Instead, the claims understandably focus on the genetic information encoded in the BRCA1 and BRCA2 genes. If the patents depended upon the creation of a unique molecule, then a would-be infringer could arguably avoid at least Myriad’s patent claims on entire genes (such as claims 1 and 2 of the ’282 patent) by isolating a DNA sequence that included both the BRCA1 or BRCA2 gene and one additional nucleotide pair.”
2. “cDNA does not present the same obstacles to patentability as naturally occurring, isolated DNA segments. --- [C]reation of a cDNA sequence from mRNA results in an exons-only molecule that is not naturally occurring.”
+ - ~ Biotech Directive (1998)
“ An element isolated from the human body or otherwise produced by means of a technical process, including the sequence or partial sequence of a gene, may constitute a patentable invention, even if the structure of that element is identical to that of a natural element.”
+ - Highly controversial
+ - ~ Incorporated into EPC law through Implementing Regulations
ECJ (2001): Patenting of human genetic material does not violate principles of human dignity
+ - Net effect: An isolated gene is patentable, so long as the applicant specifies its industrial application
Technical mistakes caused some of Myriad’s EPC BRCA patents to be narrowed, but the EPO rejected all subject-matter challenges to them
+ - Monsanto v. Cetera (ECJ 2010)
+ - Monsanto holds EPO patents on roundup-ready soybeans (specifically, on the modified soybean DNA sequence that gives the plant resistance to roundup)
Cetera grows roundup-ready soybeans in Argentina, then imports soybean meal into Europe
Monsanto alleges violation of Dutch patent, based upon importation of a product that contains an inactive ("dead") version of the patented gene
Cetera defends on the ground that Dutch patent law is inconsistent with EU Biotechnology Directive
The protection conferred by a patent on a product containing or consisting of genetic information shall extend to all material . . . in which the product is incorporated and in which the genetic information is contained and performs its function.
computerized process for converting binary-coded numerals to pure binary form
Held: unpatentable because the invention claimed consists of no more than a mathematical algorithm; a patent would preempt its use
computerized method for continuously recalculating the "alarm limit" during a chemical conversion process
Held: unpatentable, because if one ignores the algorithm on which the process is based, the claimed invention contains nothing new or inventive
Door left open a crack: "We do not hold that no process patent could ever qualify if it did not meet the requirements of our prior precedents. It is said that the decision precludes a patent for any program servicing a computer. We do not so hold."
If the claimed invention (a) directly or indirectly recites a mathematical algorithm, but (b) applies that algorithm in an otherwise statutory appparatus or process claim, it's patentable
a process for continuously monitoring the temperature inside a synthetic rubber mold, using a computer and the well-known Arrhenius equation for measuring cure time as a function of temperature and other variables
Held: patentable, because this is an ordinary industrial process that happens to incorporate a computer program
computerized method of analyzing electrocardiograph ("ECG") patterns to detect persons at risk for certain heart diseases
"These claimed steps of 'converting,' 'applying,' 'determining,' and "comparing' are physical process steps that transform one physical, electrical signal into another."
software for controlling the illumination of pixels on an oscilliscope to minimize discontinuity and jaggedness
Held: an algorithm embedded in general purpose computer is patentable
~ computerized hub & spoke accounting method
Transformation of data by a machine into a final share price constitutes a practical application of an algorithm and is therefore patentable subject matter
Repudiate "business methods" exception to patentability
The claims at issue relate to a computerized scheme for mitigating “settlement risk”—i.e., the risk that only one party to an agreed-upon financial exchange will satisfy its obligation. In particular, the claims are designed to facilitate the exchange of financial obligations between two parties by using a computer system as a third-party intermediary.
The intermediary creates “shadow” credit and debit records (i.e., account ledgers) that mirror the balances in the parties’ real-world accounts at “exchange institutions” (e.g., banks). The intermediary updates the shadow records in real time as transactions are entered, allowing “only those transactions for which the parties’ updated shadow records indicate sufficient resources to satisfy their mutual obligations.”
At the end of the day, the intermediary instructs the relevant financial institutions to carry out the “permitted” transactions in accordance with the updated shadow records, thus mitigating the risk that only one party will perform the agreed-upon exchange.
+ - [A] framework for distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of those concepts:
Step 1: First, we determine whether the claims at issue are directed to one of those patent-ineligible concepts.
+ - Step 2: If so, we then ask, “[w]hat else is there in the claims before us?” To answer that question, we consider the elements of each claim both individually and “as an ordered combination” to determine whether the additional elements “transform the nature of the claim” into a patent-eligible application.
We have described step two of this analysis as a search for an “ ‘inventive concept’”—i.e., an element or combination of elements that is “sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.”
+ - Step 1: “On their face, the claims before us are drawn to the concept of intermediated settlement, *i.e.,* the use of a third party to mitigate settlement risk.
Like the risk hedging in *Bilski*, the concept of intermediated settlement is “ ‘a fundamental economic practice long prevalent in our system of commerce.’” ... Thus, intermediated settlement, like hedging, is an“abstract idea” beyond the scope of §101.”
+ - Step 2: “We conclude that the method claims, which merely require generic computer implementation, fail to transform that abstract idea into a patent eligible invention. ...
Taking the claim elements separately, the function performed by the computer at each step of the process is “[p]urely conventional.” ... Petitioner’s claims to a computer system and a computer readable medium fail for substantially the same reasons. ... Put another way, the system claims are no different from the method claims in substance. The method claims recite the abstract idea implemented on a generic computer; the system claims recite a handful of generic computer components configured to implement the same idea.”
applications for BMPs should be treated like any other process patent applications
a process is patent-eligible if it produces “a useful, concrete, and tangible result” — such as the transformation of financial data from one form to another form.
a claim reciting an algorithm or abstract idea can state statutory subject matter only if, as employed in the process, it is embodied in, operates on, transforms, or otherwise involves another class of statutory subject matter, i.e., a machine, manufacture, or composition of matter
the present statute does not allow patents to be issued on particular business systems—such as a particular type of arbitration—that depend entirely on the use of mental processes
1. A method for managing the consumption risk costs of a commodity sold by a commodity provider at a fixed price comprising the steps of:
(a) initiating a series of transactions between said commodity provider and consumers of said commodity wherein said consumers purchase said commodity at a fixed rate based upon historical averages, said fixed rate corresponding to a risk position of said consumer;
(b) identifying market participants for said commodity having a counter-risk position to said consumers; and
(c) initiating a series of transactions between said commodity provider and said market participants at a second fixed rate such that said series of market participant transactions balances the risk position of said series of consumer transactions.
(1) Whether claim 1 of the 08/833,892 patent application claims patent-eligible subject matter under Section 101?
(2) What standard should govern in determining whether a process is patent-eligible subject matter under Section 101?
(3) Whether the claimed subject matter is not patent-eligible because it constitutes an abstract idea or mental process; when does a claim that constitutes both mental and physical steps create patent-eligible subject matter?
(4) Whether a method or process must result in a physical transformation of an article or be tied to a machine to be patent-eligible subject matter under Section 101?
+ - For a claimed process to be patent-eligible under § 101, it is both necessary and sufficient that either:
reject blanket exclusion of business methods
reject "machine or transformation" test as the exclusive test, but approve it as one among many
reinstate, roughly, prior open-ended definitions of "process"
encourage CAFC to continue to look for ways of limiting BMPs to ensure they advance the purposes of the patent system
defendants accused of infringing BMPs in financial services field can initiate post-grant PTO review of the patents
this option expires in 2020
3. Members may also exclude from patentability:
(a) diagnostic, therapeutic and surgical methods for the treatment of humans or animals...
European patents shall not be granted in respect of: ... (c) methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practised on the human or animal body; this provision shall not apply to products, in particular substances or compositions, for use in any of these methods.
US position after 1996: patents permissible but doctors and "related health care entities" are not subject to patent remedies for "performance" of "medical activities"
**(1)** With respect to a medical practitioner’s performance of a medical activity that constitutes an infringement under section 271(a) or (b), the provisions of sections 281, 283, 284, and 285 shall not apply against the medical practitioner or against a related health care entity with respect to such medical activity.
+ - **(2)** For the purposes of this subsection:
**(A)** the term “medical activity” means **the performance of a medical or surgical procedure on a body**, but shall not include (i) the use of a patented machine, manufacture, or composition of matter in violation of such patent, (ii) the practice of a patented use of a composition of matter in violation of such patent, or (iii) the practice of a process in violation of a biotechnology patent.
[biotechnology patent = "a process of genetically altering of inducing a single or multi-celled organism" *or* "cell fusion procedures yielding a cell line that expresses a specific protein" *or* "methods of using a product produced" by the above processes.]
**(B)** the term “medical practitioner” means any natural person who is licensed by a State to provide the medical activity described in subsection (c)(1) or who is acting under the direction of such person in the performance of the medical activity.
**(C)** the term “related health care entity” shall mean an entity with which a medical practitioner has a professional affiliation under which the medical practitioner performs the medical activity, including but not limited to a nursing home, hospital, university, medical school, health maintenance organization, group medical practice, or a medical clinic.
**(D)** the term “professional affiliation” shall mean staff privileges, medical staff membership, employment or contractual relationship, partnership or ownership interest, academic appointment, or other affiliation under which a medical practitioner provides the medical activity on behalf of, or in association with, the health care entity.
**(E)** the term “body” shall mean a human body, organ or cadaver, or a nonhuman animal used in medical research or instruction directly relating to the treatment of humans.
**(F)** the term “patented use of a composition of matter” does not include a claim for a method of performing a medical or surgical procedure on a body that recites the use of a composition of matter where the use of that composition of matter does not directly contribute to achievement of the objective of the claimed method.
**(G)** the term “State” shall mean any State or territory of the United States, the District of Columbia, and the Commonwealth of Puerto Rico.
+ - **(3)** This subsection does not apply to the activities of any person, or employee or agent of such person (regardless of whether such person is a tax exempt organization under section 501(c) of the Internal Revenue Code), who is engaged in the commercial development, manufacture, sale, importation, or distribution of a machine, manufacture, or composition of matter or the provision of pharmacy or clinical laboratory services (other than clinical laboratory services provided in a physician’s office), where such activities are:
**(A)** directly related to the commercial development, manufacture, sale, importation, or distribution of a machine, manufacture, or composition of matter or the provision of pharmacy or clinical laboratory services (other than clinical laboratory services provided in a physician’s office), and
**(B)** regulated under the Federal Food, Drug, and Cosmetic Act, the Public Health Service Act, or the Clinical Laboratories Improvement Act.
**(4)** This subsection shall not apply to any patent issued based on an application which has an effective filing date before September 30, 1996.
"A method of optimizing therapeutic efficacy for treatment of an immune-mediated gastrointestinal disorder, comprising:
"(a) administering a drug providing 6-thioguanine to a subject having said immune-mediated gastrointestinal disorder; and
"(b) determining the level of 6-thioguanine in said subject having said immune-mediated gastrointestinal disorder, "wherein the level of 6-thioguanine less than about 230 pmol per 8x108 red blood cells indicates a need to increase the amount of said drug subsequently administered to said subject and
"wherein the level of 6-thioguanine greater than about 400 pmol per 8x108 red blood cells indicates a need to decrease the amount of said drug subsequently administered to said subject."
administer a drug for inflammatory bowel disease
test for levels of resultant metabolite in the blood
administer more or less of the drug, depending on whether metabolite levels fall above or below specified range
“ [W]hile “individual doctors generally are immune from suit, ... the commercial entities that enable and induce the infringement (such as Mayo’s for-profit laboratory) are not.” Brief for the Respondent in Opposition (to the petition for writ of certiorari), at 34.
However, 35 U.S.C. § 287(c) makes no distinction between “for- profit,” “not-for-profit,” and any other types of the defined “related health care entities” based upon financial motivation or any other criteria, for that matter; all are immune from suit unless one of the three § 287(c)(2)(A) exceptions applies.
Prometheus fails completely to explain why Mayo Clinic Rochester and its related Mayo Collaborative Services are not “related health care entities” within the meaning of 35 U.S.C. § 287(c)(2)(C) and (D), both entitled to be free from patent infringement suits of the instant type. In fact, AIPPI respectfully suggests that both named defendants are plainly “related health care entities” and that, accordingly, Congress has eliminated availability of a federal civil action for patent infringement of Prometheus’ patent against them.
The immunity from suit provided by Congress in 35 U.S.C. § 287(c)(1) should be given effect, and the case dismissed for lack of federal subject matter jurisdiction. That this issue apparently was not raised before either the District Court or the Federal Circuit is of no import, as it is hornbook law that “[o]bjections to subject-matter jurisdiction ... may be raised at any time.”
reject patent on 101 grounds
"If a law of nature is not patentable, then neither is a process reciting a law of nature, unless that process has additional features that provide practical assurance that the process is more than a drafting effort designed to monopolize the law of nature itself. "
"Purely "conventional or obvious" "[pre]solution activity" is normally not sufficient to transform an unpatentable law of nature into a patent eligible application of such a law. "
Policy
“[P]atent law [should] not inhibit further discovery by improperly tying up the future use of laws of nature"
Adjustment of therapies to meet individual patient’s needs, often following diagnostic testing to ascertain individual characteristics
• Limits taxpayers’ ability to use fully tax law interpretations intended by Congress;
• May cause some taxpayers to pay more tax than Congress intended or more than others similarly situated;
• Complicates the provision of tax advice by professionals;
• Hinders compliance by taxpayers;
• Misleads taxpayers into believing that a patented strategy is valid under the tax law; and
• Precludes tax professionals from challenging the validity of a patented strategy.
(a) IN GENERAL.--For purposes of evaluating an invention under section 102 or 103 of title 35, United States Code, any strategy for reducing, avoiding, or deferring tax liability, whether known or unknown at the time of the invention or application for patent, shall be deemed insufficient to differentiate a claimed invention from the prior art.
(b) DEFINITION.--For purposes of this section, the term “tax liability” refers to any liability for a tax under any Federal, State, or local law, or the law of any foreign jurisdiction, including any statute, rule, regulation, or ordinance that levies, imposes, or assesses such tax liability.
+ - (c) EXCLUSIONS.--This section does not apply to that part of an invention that--
(1) is a method, apparatus, technology, computer program product, or system, that is used solely for preparing a tax or information return or other tax filing, including one that records, transmits, transfers, or organizes data related to such filing; or
(2) is a method, apparatus, technology, computer program product, or system used solely for financial management, to the extent that it is severable from any tax strategy or does not limit the use of any tax strategy by any taxpayer or tax advisor.
(d) RULE OF CONSTRUCTION.--Nothing in this section shall be construed to imply that other business methods are patentable or that other business method patents are valid.
(e) EFFECTIVE DATE; APPLICABILITY.--This section shall take effect on the date of the enactment of this Act and shall apply to any patent application that is pending on, or filed on or after, that date, and to any patent that is issued on or after that date.
171(b): The provisions of this title relating to patents for inventions shall apply to patents for designs, except as otherwise provided.
“ LAG correctly asserts that if a patented design is "primarily functional," rather than primarily ornamental, the patent is invalid. ... When function dictates a design, protection would not promote the decorative arts, a purpose of the design patent statute. ... There is no dispute that shoes are functional and that certain features of the shoe designs in issue perform functions. However, a distinction exists between the functionality of an article or features thereof and the functionality of the particular design of such article or features thereof that perform a function. Were that not true, it would not be possible to obtain a design patent on a utilitarian article of manufacture, see, e.g., Pacific Furniture Mfg. Co. v. Preview Furniture Corp., 800 F.2d 1111 (Fed. Cir. 1986) (design patent for chairs), or to obtain both design and utility patents on the same article, see, e.g., Carman Indus., Inc. v. Wahl, 724 F.2d 932, 938-39 (1958).
Quoting with approval the ruling of the District Court: “ But every function which [LAG] says is achieved by one of the component aspects of the sole in this case could be and has been achieved by different components. And that is a very persuasive rationale for the holding that the design overall is not primarily functional. Moreover, there is no function which even defendant assigns to the swirl effect around the pivot point, which swirl effect is a very important aspect of the design.”
“ The patents-in-suit are directed to surgical instruments that use ultrasonic energy created by blades vibrat- ing at high frequencies to cut tissue and blood vessels. These surgical instruments also use the heat generated from the friction of the blade vibrating against the blood vessel to coagulate and seal those blood vessels in order to prevent bleeding.”
“ The Design Patents claim particular ornamental designs of an ultrasonic surgical device. The D’801 patent claims a particular ornamental design of an inverted “U”-shaped trigger. The D’802 patent claims the overall appearance of the ornamental design of the “U”-shaped trigger and the particular ornamental design of a rounded and fluted torque knob positioned above and forward from the trigger. The D’803 patent claims the overall appearance of the ornamental design of the “U”-shaped trigger and the particular ornamental design of a rounded activation button positioned directly above the trigger. The D’804 patent claims the overall appearance of the ornamental designs of the “U”-shaped trigger, the fluted torque knob, and the rounded activation button, with the torque knob and the button positioned relative to the trigger as in the D’802 and D’803 patents, respectively.
1. A method for sealing a blood vessel of a patient comprising the steps of:
a) obtaining an ultrasonic surgical shears including an ultrasonic surgical blade, a clamping arm operable to open and close toward the blade, a tissue pad attached to the clamping arm, means for providing a clamp force and means for limiting a user applied clamp force, wherein the blade and tissue pad define a clamping surface area so that the applied clamp force does not exceed a clamping pressure of 210 psi at the clamping surface area;...
12. An ultrasonic surgical shears comprising:
a) an ultrasonic surgical blade;
b) a clamping arm operable to open and close toward the blade;
c) a tissue pad attached to the clamping arm;
d) means for exerting a predetermined clamping force on the clamping arm, wherein the blade and tissue pad define a clamping surface area so that the clamp force does not exceed a clamping pressure of 210 psi at the clamping surface area; and
e) means for limiting a user applied clamping force.
Articles of manufacture necessarily serve a utilitarian purpose, but design patents are directed to ornamental designs of such articles. 35 U.S.C. § 171. If a particular
design is essential to the use of an article, it cannot be the subject of a design patent. ... We have found designs to be essential to the use of an article when the claimed design is “dictated by” the use or purpose of the article. ... Design patents on such primarily functional rather than ornamental designs are invalid. In determining whether a claimed design is primarily functional, “[t]he function of the article itself must not be confused with ‘functionality’ of the design of the article.”... We have also instructed that the overall appearance of the article—the claimed design viewed in its entirety— is the basis of the relevant inquiry, not the functionality of elements of the claimed design viewed in isolation.
We have not mandated applying any particular test for determining whether a claimed design is dictated by its function and therefore impermissibly functional. We have often focused, however, on the availability of alternative designs as an important—if not dispositive—factor in evaluating the legal functionality of a claimed design....
+ - The foregoing evidence does not support the district court’s grant of summary judgment that the claimed designs are primarily functional for two reasons.
First, the district court’s determination that the designs did not work “equally well” apparently describes the preferences of surgeons for certain basic design concepts, not differences in functionality of the differently designed ultrasonic shears....
Further, the district court’s functionality inquiry used too high of a level of abstraction. Instead of focusing on whether the specific patented designs had a functional purpose—the continuously curved “U” shape of the open trigger having tapered handles with ends flaring outwards, the football-shape of the activation button, and the asymmetrically-fluted torque knob with a flat front face— the district court focused its PHG analysis on the functional characteristics that any design of an open trigger, button, and torque knob would have for the underlying ultrasonic shears.
The overall impression of the design must be different from any prior-art reference or device in the eyes of an "ordinary observer"
The novelty provisions of 102 apply
“In the design patent context, the ultimate inquiry under section 103 is whether the claimed design would have been obvious to a designer of ordinary skill who designs articles of the type involved .... More specifically, the inquiry is whether one of ordinary skill would have combined teachings of the prior art to create the same overall visual appearance as the claimed design. .... Before one can begin to combine prior art designs, however, one must find a single reference, ‘a something in existence, the design characteristics of which are basically the same as the claimed design.’ .... Once this primary reference is found, other references may be used to modify it to create a design that has the same overall visual appearance as the claimed design. .... These secondary references may only be used to modify the primary reference if they are ‘so related [to the primary reference] that the appearance of certain ornamental features in one would suggest the application of those features to the other.’ .”
“ With respect to a design, obviousness is determined from the vantage of "the designer of ordinary capability who designs articles of the type presented in the application." In re Nalbandian, 661 F.2d at 1216,.... LAG argues that the designs would have been obvious because they are "traditional ones consisting of features old in the art." That some components of Avia's designs exist in prior art references is not determinative. " [I]f the combined teachings suggest only components of the claimed design but not its overall appearance, a rejection under section 103 is inappropriate." .... There is no evidence that the overall appearances of the '420 and '301 designs would have been suggested to ordinary shoe designers by the references.
LAG does not contest the commercial success of Avia's shoes manufactured according to the patented designs, but argues the success is attributable to factors other than the designs themselves, such as advertising. Although commercial success is relevant only if a nexus is proven between the success of the patented product and the merits of the claimed invention, ... Avia did present evidence tending to prove nexus and LAG's conclusory statements to the contrary fail to create a genuine factual dispute.
In addition, the trial court referred to the accused products as "copies" of the patented designs. ... Copying is additional evidence of nonobviousness. ... LAG's conclusory characterization of the evidence as "speculative" is insufficient to create a genuine factual dispute. On the basis of its evaluation of the four factors outlined above, the court held that the ordinary designer would not have found the '420 or '301 designs, considered as whole designs, obvious in light of the differences between the prior art and the claimed designs. We agree.
‘“For design patents, the role of one skilled in the art in the obviousness context lies only in determining whether to combine earlier references to arrive at a single piece of art for comparison with the potential design or to modify a single prior art reference. Once that piece of prior art has been constructed, obviousness, like anticipation, requires application of the ordinary observer test, not the view of one skilled in the art.”
+ - Origin: _Gorham_ (SCOTUS 1871)
"[I]f, in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase one supposing it to be the other, the first one patented is infringed by the other."
+ - Courts of Appeals supplement the “ordinary observer” test with “Point of Novelty” Test: The accused device must appropriate the novelty in the patented device which distinguishes it from the prior art
“For a design patent to be infringed, however, no matter how similar two items look, "the accused device must appropriate the novelty in the patented device which distinguishes it from the prior art." .... That is, even though the court compares two items through the eyes of the ordinary observer, it must nevertheless, to find infringement, attribute their similarity to the novelty which distinguishes the patented device from the prior art. (This "point of novelty" approach applies only to a determination of infringement....)
“The novelty of the '990 patent consists, in light of our analysis in the previous section on the '990 patent's validity, of the combination on a microwave oven's exterior of a three-stripe door frame, a door without a handle, and a latch release lever on the control panel. The district court expressly found, however, that the Whirlpool design had none of these features.”
+ - ~ In 2008, CAFC retreats in _Egyptian Goddess_ (en banc)
+ - Held: apply the ordinary observer test (are the two designs substantially the same to an ordinary observer?) -- with the understanding that the ordinary observer will pay close attention to the prior art
"When the differences between the claimed and accused design(s) are viewed in light of the prior art, the attention of the hypothetical ordinary observer will be drawn to those aspects of the claimed design that differ from the prior art. And when the claimed design is close to the prior art designs, small differences between the accused design and the claimed design are likely to be important to the eye of the hypothetical ordinary observer."
+ - Suggest 2-stage analysis:
“In some instances, the claimed design and the accused design will be sufficiently distinct that it will be dear without more that the patentee has not met its burden of proving the two designs would appear "substantially the same" to the ordinary observer, as required by *Gorham.*
“In other instances, when the claimed and accused designs are not plainly dissimilar, resolution of the question whether the ordinary observer would consider the two designs to be substantially the same will benefit from a comparison of the claimed and accused designs with the prior art.... Where there are many examples of similar prior art designs, ... differences between the claimed and accused designs that might not be noticeable in the abstract can become significant to the hypothetical ordinary observer who is conversant with the prior art.”
+ - Applied
“It is agreed that the general shape of the accused nail buffer at issue in this case is the same as that of the patented buffer design. The difference between the two is that the accused buffer has raised buffing pads on all four sides, while the patented buffer has buffing pads on only three sides.
“The two closest prior art nail buffers before the court were the Falley nail buffer, which has a solid, rectangular cross section with slightly raised buffers on all sides, and the Nailco patent, which shows a nail buffer design having a triangular shape and a hollow cross section, and in which raised buffing pads are located on all three sides
“The question before this court under the standard we have set forth above is whether an ordinary observer, familiar with the prior art Falley and Nailco designs, would be deceived into believing the Swisa buffer is the same as the patented buffer....
“In light of the similarity of the prior art buffers to the accused buffer, we conclude that no reasonable fact-finder could find that EGI met its burden of showing, by a preponderance of the evidence, that an ordinary observer, taking into account the prior art, would believe the accused design to be the same as the patented design.”
Whoever during the term of a **patent for a design**, without license of the owner, (1) applies the patented design, or any colorable imitation thereof, to any **article of manufacture** for the purpose of sale, or (2) sells or exposes for sale any **article of manufacture** to which such design or colorable imitation has been applied shall be liable to the owner to the extent of his **total profit,** but not less than $250, recoverable in any United States district court having jurisdiction of the parties.
Nothing in this section shall prevent, lessen, or impeach any other remedy which an owner of an infringed patent has under the provisions of this title, but he shall not twice recover the profit made from the infringement.
“Article of manufacture” can mean a component of a product -- in which case damages for infringement = “total profit” attributable to that component
(1) European patents shall be granted for any inventions which are susceptible of industrial application, which are new and which involve an inventive step.
+ - (2) The following in particular shall not be regarded as inventions within the meaning of paragraph 1:
(a) discoveries, scientific theories and mathematical methods;
(b) aesthetic creations;
(c) schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers;
(d) presentations of information.
(3) The provisions of paragraph 2 shall exclude patentability of the subject-matter or activities referred to in that provision only to the extent to which a European patent application or European patent relates to such subject-matter or activities as such.
+ - (4) Methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practised on the human or animal body shall not be regarded as inventions which are susceptible of industrial application within the meaning of paragraph 1.
This provision shall not apply to products, in particular substances or compositions, for use in any of these methods.
(a) inventions the publication or exploitation of which would be contrary to "ordre public" or morality, provided that the exploitation shall not be deemed to be so contrary merely because it is prohibited by law or regulation in some or all of the Contracting States;
(b) plant or animal varieties or essentially biological processes for the production of plants or animals; this provision does not apply to microbiological processes or the products thereof.
(c) methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practised on the human or animal body; this provision shall not apply to products, in particular substances or compositions, for use in any of these methods.
An invention shall be considered as susceptible of industrial application if it can be made or used in any kind of industry, including agriculture.
Patent rights shall not be granted for invention-creations that violate the law or social ethics, or harm public interests.
Patent rights shall not be granted for inventions that are accomplished by relying on genetic resources which are obtained or used in violation of the provisions of laws and administrative regulations.
Inventions and utility models for which patent rights are to be granted shall be ones which are novel, creative and of practical use.
Novelty means that the invention or utility model concerned is not an existing technology; no patent application is filed by any unit or individual for any identical invention or utility model with the patent administration department under the State Council before the date of application for patent right, and no identical invention or utility model is recorded in the patent application documents or the patent documentations which are published or announced after the date of application.
Creativity means that, compared with the existing technologies, the invention possesses prominent substantive features and indicates remarkable advancements, and the utility model possesses substantive features and indicates advancements.
Practical use means that the said invention or utility model can be used for production or be utilized, and may produce positive results.
+ - An inventor of an invention that is industrially applicable may be entitled to obtain a patent for the said invention, except for the following:
+ - (i) inventions that were publicly known in Japan or a foreign country, prior to the filing of the patent application;
+ - (ii) inventions that were publicly worked in Japan or a foreign country, prior to the filing of the patent application; or
+ - (iii) inventions that were described in a distributed publication, or inventions that were made publicly available through an electric telecommunication line in Japan or a foreign country, prior to the filing of the patent application.
+ - Article 32 Notwithstanding Article 29, any invention that is liable to injure public order, morality or public health shall not be patented.
1. The term "invention" means the highly advanced creation of a technical idea utilizing the laws of nature;
2. The term "patented invention" means an invention for which a patent has been granted;
3. The term "practice" means any of the following acts:
(a) An invention of a product: Manufacturing, using, assigning, leasing, or importing the product or offering to assign or lease the product (including displaying the product for the purpose of assigning or leasing; hereinafter the same shall apply);
(b) An invention of a process: Using the process;
(c) An invention of a process of manufacturing a product: Using, assigning, leasing, or importing the product manufactured by the process or offering to assign or lease the product, other than the acts specified in item (b).
An invention having industrial applicability, other than the following, is patentable:
1. An invention publicly known or executed in the Republic of Korea or in a foreign country prior to the filing of a patent application;
2. An invention published in a publication distributed in the Republic of Korea or in a foreign country or an invention disclosed to the public via telecommunications lines prior to the filing of a patent application.
Notwithstanding Article 29 (1), no invention that violates public order or sound morals or is likely to harm public health is patentable.
(1) The effects of a patent shall not extend to the following:
1. Execution of a patented invention for the purpose of research or testing (including research and testing for obtaining permission for items of medicines or reporting items of medicines by under the Pharmaceutical Affairs Act or for registering pesticides under the Pesticide Control Act
2. Ships, aircraft, vehicles merely passing through the Republic of Korea, or machines, instruments, equipment, or other articles used therein
3. Articles existing in the Republic of Korea as at the time the relevant patent application was filed.
(2) The effects of a patent on the invention of a medicine manufactured by mixing at least two medicines (referring to products used for the diagnosis, relief, treatment, therapy, or prevention of human diseases; hereinafter the same shall apply) or on the invention of a process for manufacturing medicines by mixing at least two medicines shall not extend to the preparation of prescriptions and medicines prepared according to such prescriptions under the Pharmaceutical Affairs Act.
“it is well established in Korea that genes, cDNAs, vectors and other biological materials isolated from nature are patent eligible regardless of their sources”
“Human genes are, therefore, patentable.”
“Although it is in a legally separate issue, proving the utility of claimed genes is often discussed on the same level with the patent eligibility.”
“To this issue, the Korean court states that specific, substantial and credible utility is required for genes to be patented.”
“Cells and higher life forms such as plants and animals are also patent eligible”
“This is also true for stem cells...stem cells may be patented by defining cells by their origins, expression markers, morphological features, functions and preparation methods”
However “stem cells and higher life forms may be affected by [Article 32, which holds that inventions liable to contravene public order and morality cannot be patented] more than any other types of inventions for ethical reasons.”
Seed Industry Law (under UPOV convention) may also be used to protect plant varietals
~ “Methods of medical treatment for humans cannot be patented in Korea”
no explicit prohibition on these within Patent Act, but: “courts are clear that these claims cannot be patented primarily because of the concern about the misuse of privately owned patent rights against public health.”
[From March 18, 2019]: "diagnostic technology concerning methods of information processing on computers such as bio-big data processing methods are not classified as medical acts and therefore, are acknowledged as having industrial applicability."
“For example, because inventions such as a method of diagnosing a retinal disorder through analysis of retinal scan data by a computer, a method of predicting or diagnosing cancer by analyzing a patient's data through an artificial intelligence algorithm of a computer are not necessarily performed by physicians, such inventions are not classified as medical acts and therefore, are acknowledged as having industrial applicability.“
[NEW development]
[From March 18, 2019]: “already known inventions of pharmaceutical composition for treatment of a disease comprising a pharmaceutically active ingredient are now considered patentable, if such pharmaceutical composition exhibits remarkable therapeutic effect on a certain patient group.”
“For example, the invention of a pharmaceutical composition comprising a known pharmaceutical active ingredient exhibiting a remarkable therapeutic effect only in patients with a particular gene is patentable.”
“For such inventions, a clear definition of a particular patient population and empirical verification of the remarkability of its therapeutic effect should be described in the specification.”
yet “method[s] of medical treatment for animals which explicitly exclude humans from the treatment subject can be patented.”
Weak version: prevent the patent system from fostering the development of socially pernicious innovations
Strong version: channel innovation toward areas of greatest social need
"The Congress shall have power … to promote the Progress of science and _useful_ arts, by securing for limited times to authors and inventors, the exclusive right to their respective Writings and Discoveries"
“Whoever invents or discovers any new and *useful* process, machine, manufacture, or composition of matter, or any new and *useful* improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”
“ An EST is a short nucleotide sequence that represents a fragment of a cDNA clone. It is typically generated by isolating a cDNA clone and sequencing a small number of nucleotides located at the end of one of the two cDNA strands. When an EST is introduced into a sample containing a mixture of DNA, the EST may hybridize with a portion of DNA. Such binding shows that the gene corresponding to the EST was being expressed at the time of mRNA extraction.
Claim 1 of the ’643 application recites: “A substantially purified nucleic acid molecule that encodes a maize protein or fragment thereof comprising a nucleic acid sequence selected from the group consisting of SEQ ID NO: 1 through SEQ ID NO: 5.”
“ Turning to the “specific” utility requirement, an application must disclose a use which is not so vague as to be meaningless. Indeed, one of our predecessor courts has observed “that the nebulous expressions ‘biological activity’ or ‘biological properties’ appearing in the specification convey no more explicit indication of the usefulness of the compounds and how to use them than did the equally obscure expression ‘useful for technical and pharmaceutical purposes’ unsuccessfully relied upon by the appellant in In re Diedrich.” In re Kirk, 376 F.2d 936, 941 (C.C.P.A. 1967). Thus, in addition to providing a “substantial” utility, an asserted use must also show that that claimed invention can be used to provide a well-defined and particular benefit to the public.
“ Regarding the seven uses asserted by Fisher, we observe that each claimed EST uniquely corresponds to the single gene from which it was transcribed (“underlying gene”). As of the filing date of the ’643 application, Fisher admits that the underlying genes have no known functions.”
Examples: “a new invention to poison people, or to promote debauchery, or to facilitate private assassination”
“1. A seamless stocking having therein at the back of the leg a structural variation of the knit fabric of which it is composed, imitating the narrowing marks occurring in seamed or other narrowed stockings.”
Patentee argues: ”Unthinking purchasers still depend upon superficial characteristics of the once superior sort of stocking to indicate to them a desirable article of purchase, without examining the stocking for the other structural features upon which a more intelligent choice might be based. Such persons usually prefer, when they can be induced to make a decision on their respective merits, that type of stocking having no seam at the back, which has manifest advantages as an article of wear. The existence of a large body of prejudice of this sort in the minds of the public unfairly militates against the sale of the circular knit articles of hosiery."
“This record justifies the claim that the full-fashioned stocking is superior to the seamless stocking. The testimony of the retailers, jobbers, and manufacturers of seamless stockings are all to the effect that they are not the equal of the full-fashioned stocking as a desirable article of wear, because they do not possess the qualities of fit that make it a desirable article that a full-fashioned stocking has been recognized to be. At best, the seamless stocking has imitation marks for **the purpose of deception**, and the idea prevails that with such imitation the article is more salable.”
“But such accomplishment does not create a new useful discovery or invention, and **it was not the intention of Congress to grant protection to those who confer no other benefit to the public than an opportunity for making the article more salable**.”
“We decline to follow Rickard and Aristo Hosiery, as we do not regard them as representing the correct view of the doctrine of utility under the Patent Act of 1952. The fact that one product can be altered to make it look like another is in itself a specific benefit sufficient to satisfy the statutory requirement of utility.”
(1) European patents shall be granted for any inventions, in all fields of technology, provided that they are new, involve an inventive step and _are susceptible of industrial application._
+ - (2) The following in particular shall not be regarded as inventions within the meaning of paragraph 1:
(a) discoveries, scientific theories and mathematical methods;
(b) aesthetic creations;
(c) schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers;
(d) presentations of information.
(3) Paragraph 2 shall exclude the patentability of the subject-matter or activities referred to therein only to the extent to which a European patent application or European patent _relates to such subject-matter or activities as such_.
European patents shall not be granted in respect of:
(a) _inventions the commercial exploitation of which would be contrary to "ordre public" or morality_; such exploitation shall not be deemed to be so contrary merely because it is prohibited by law or regulation in some or all of the Contracting States;
Any invention the commercial exploitation of which would be contrary to "_ordre public_" or morality is specifically excluded from patentability. The purpose of this is to deny protection to inventions likely to induce riot or public disorder, or to lead to criminal or other generally offensive behaviour (see also F-II, 7.2). Anti-personnel mines are an obvious example. Examples in the area of biotechnological inventions as laid down in Rule 28 are listed in G-II, 5.3.
This provision is likely to be invoked only in rare and extreme cases. A fair test to apply is to consider whether it is probable that the public in general would regard the invention as so abhorrent that the grant of patent rights would be inconceivable. If it is clear that this is the case, an objection is raised under Art. 53(a); otherwise not. The mere possibility of abuse of an invention is not sufficient to deny patent protection pursuant to Art. 53(a) EPC if the invention can also be exploited in a way which does not and would not infringe "_ordre public_" and morality (see T 866/01). If difficult legal questions arise in this context, then refer to C-VIII, 7.
Where it is found that the claims relate in part to such excluded subject-matter, this may have led to the issuing of a partial European or supplementary European search report under Rule 63 (see B-VIII, 1, 3.1 and 3.2). In such cases, in the absence of appropriate amendment and/or convincing arguments provided by the applicant in his response to the invitation under Rule 63(1) (see B-VIII, 3.2) or to the search opinion under Rule 70a (see B-XI, 8), an objection under Rule 63(3) will also arise (see H-II, 5).
Exploitation is not to be deemed to be contrary to "_ordre public_" or morality merely because it is prohibited by law or regulation in some or all of the contracting states. One reason for this is that a product could still be manufactured under a European patent for export to states in which its use is not prohibited.
Special attention must be paid to applications in which the invention has both an offensive and a non-offensive use, e.g. a process for breaking open locked safes, the use by a burglar being offensive but the use by a locksmith in the case of emergency non-offensive. In such a case, no objection arises under Art. 53(a). Similarly, if a claimed invention defines a copying machine with features resulting in an improved precision of reproduction and an embodiment of this apparatus could comprise further features (not claimed but apparent to the skilled person) the only purpose of which would be that it also allows reproduction of security strips in banknotes strikingly similar to those in genuine banknotes, the claimed apparatus would cover an embodiment for producing counterfeit money which could be considered to fall under Art. 53(a). There is, however, no reason to consider the copying machine as claimed to be excluded from patentability, since its improved properties could be used for many acceptable purposes (see G 1/98, Reasons 3.3.3). However, if the application contains an explicit reference to a use which is contrary to "_ordre public_" or morality, deletion of this reference is required under the terms of Rule 48(1)(a).
The EPO has not been vested with the task of taking into account the economic effects of the grant of patents in specific areas of technology and of restricting the field of patentable subject-matter accordingly (see G 1/98 Reasons 3.9, and T 1213/05). The standard to apply for an exception under Art. 53(a) is whether the commercial exploitation of the invention is contrary to "_ordre public_" or morality.
Under Art. 53(a), in conjunction with Rule 28(1), European patents are not to be granted in respect of biotechnological inventions which concern:
+ - (i) Processes for cloning human beings
For the purpose of this exception, a process for the cloning of human beings may be defined as any process, including techniques of embryo splitting, designed to create a human being with the same nuclear genetic information as another living or deceased human being (EU Dir. 98/44/EC, rec. 41).
(ii) Processes for modifying the germ line genetic identity of human beings
+ - (iii) Uses of human embryos for industrial or commercial purposes
A claim directed to a product which at the filing date of the application could be **exclusively** obtained by a method which necessarily involved the destruction of human embryos from which the said product is derived is excluded from patentability under Rule 28(1)(c), even if said method is not part of the claim (see G 2/06). The point in time at which such destruction takes place is irrelevant (T 2221/10).
+ - When examining subject-matter relating to human embryonic stem cells under Art. 53(a) and Rule 28(1)(c), the following has to be taken into account:
(a) the **entire teaching** of the application, not only the claim category and wording, and
(b) the **relevant disclosure in the description** in order to establish whether products such as stem cell cultures are obtained exclusively by the use, involving the destruction, of a human embryo or not. For this purpose, the disclosure of the description has to be considered in view of the state of the art at the date of filing.
The exclusion of the uses of human embryos for industrial or commercial purposes does not affect inventions for therapeutic or diagnostic purposes which are applied to the human embryo and are useful to it (EU Dir. 98/44/EC, rec. 42).
+ - (iv) Processes for modifying the genetic identity of animals which are likely to cause them suffering without any substantial medical benefit to man or animal, and also animals resulting from such processes
The substantial medical benefit referred to above includes any benefit in terms of research, prevention, diagnosis or therapy (EU Dir. 98/44/EC, rec. 45).
In addition, the human body, at the various stages of its formation and development, and the simple discovery of one of its elements, including the sequence or partial sequence of a gene, cannot constitute patentable inventions (see, however, G-II, 5.2). Such stages in the formation or development of the human body include germ cells (EU Dir. 98/44/EC, rec. 16).
Also excluded from patentability under Art. 53(a) are processes to produce chimeras from germ cells or totipotent cells of humans and animals (EU Dir. 98/44/EC, rec. 38).
Judgments of the Court of Justice of the European Union on the interpretation of EU Directive 98/44/EC are not binding on the EPO. Still, they may be considered as being persuasive (T 2221/10 and T 1441/13).
(b) plant or animal varieties or essentially biological processes for the production of plants or animals; this provision shall not apply to microbiological processes or the products thereof;
+ - (c) methods for treatment of the human or animal body by surgery or therapy and diagnostic methods practised on the human or animal body; this provision shall not apply to products, in particular substances or compositions, for use in any of these methods.
Patent rights shall not be granted for invention-creations that violate the law or _social ethics, or harm public interests_....
Inventions and utility models for which patent rights are to be granted shall be ones which are novel, creative and _of practical use_....
Practical use means that the said invention or utility model _can be used for production or be utilized, and may produce positive results._
+ - An inventor of an invention that is industrially applicable may be entitled to obtain a patent for the said invention...
+ - Article 32 Notwithstanding Article 29, any invention that is _liable to injure public order, morality or public health_ shall not be patented.
Notwithstanding Article 29 (1), no invention that _violates public order or sound morals or is likely to harm public health_ is patentable.
Industrial applicability rule is unique in a way that lists specific industries as exceptions/ineligible to patentable subjects.
In general, like in the US, “applicability” can be interpreted into different types of “usefulness”
Operability and applicability are based on low threshold to meet, as long as the filed patent expects "industrial exploitation in the future", and "*does not include the situations where the industrial usability arises for the first time in the future by advances in the relevant technology.” 2001Hu2801.
~ One policy proposal for the increased application of beneficial utility in Korea’s patent system
(1) The Government may prohibit filing a patent application with a foreign patent office or may order an inventor, applicant, or agent to keep confidential an invention for which a patent application has been filed, if necessary for national defense: _Provided_, That a patent application may be filed in a foreign country with prior permission from the Government therefor.
(2) The Government may refuse to grant a patent, if an invention for which a patent application has been filed is necessary for national defense and may expropriate the entitlement to a patent for national defense during a war, an incident, or any similar emergency.
(3) The Government shall pay reasonable compensation for losses incurred due to prohibition against filing a patent application in a foreign country, or classification of a patent application as confidential under paragraph (1).
(4) The Government shall pay reasonable compensation if it refuses to grant a patent or expropriates the entitlement to a patent under paragraph (2).
(5) If a person violates an order prohibiting filing a patent application in a foreign country or keeping a patent application confidential under paragraph (1), the person shall be deemed to relinquish his or her entitlement to a patent on the relevant invention.
(6) If a person violates an order prohibiting filing a patent application in a foreign country or keeping a patent application as confidential under paragraph (1), the person shall be deemed to relinquish his or her entitlement to claim for compensation for losses incurred due to prohibition against filing the patent application in a foreign country, or classification of the patent application as confidential.
(7) Procedures for prohibiting filing a patent application in a foreign country, or for classifying a patent application as confidential under paragraph (1), procedures for expropriation and the payment of compensation therefor under paragraphs (2) through (4), and other necessary matters shall be prescribed by Presidential Decree.
cf. Article 106 (Expropriation of Patents) and Article 106-2 (Execution of Patented Inventions by Government, etc.) on conditions allowing patent expropriation by government and subsequent procedures
+ - Purposes of disclosure requirement
+ - a. Compell patentee to reveal information that will facilitate further technical progress
+ - b. Provide competitors guidance in what they may and may not do
+ - c. Provide courts guidance in understanding the invention and construing the claims
d. Prevent patentee from locking up a disproportionate territory
e. Reinforce priority principles by denying priority dates to persons who have not yet fully achieved the invention
+ - Critique: assuming these goals are desirable, the present disclosure rules do not advance them effectively
1. Patents are most heavily used for products that can easily be reverse engineered; in those contexts, disclosure in patents is unnecessary
2. Patent applicants commonly omit know-how essential to practicing and invention -- and use language designed to claim as much territory as possible and to obscure technological advances
3. Threat of enhanced damages awards for willful infringement [see Remedies section] prompt firms to discourage their employees from reading patents
US and European firms rarely report reliance on patents as a source of information concerning technological advances in their fields
Japanese firms may rely on patents somewhat more
+ - Effective disclosure would require revelation of contextual information:
Chemistry and drug patents work better than patents in other fields, because they are effectively searchable, are bound into databases of practice, and are often published long before products are commercially available
(a) The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor or joint inventor of carrying out the invention.
(b) The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the inventor or a joint inventor regards as the invention.
+ - The description must be sufficient to enable a PHOSITA to make and use all of the embodiments of the invention claimed in the patent
That a PHOSITA would need to do some experimentation to practice the invention is OK, so long as it’s not “undue”
Mechanical and electrical fields are considered predictable -- and thus enablement requirements are less strict
Chemical and biological fields are considered unpredictable -- and thus enablement requirements are stricter
disaggregation by technology
+ - Step 1: (Subjective) Did the *inventor* consider a particular way of implementing the invention superior?
+ - Step 2: (Objective) Did the application adequately enable that particular way?
I.e., did it provide sufficient information for a PHOSITA to make and use the best mode without undue experimentation
+ - no need to disclose a preferred manufacturing component or method if the patent does not cover it
+ - no need to disclose an intermediate if it has no effect on properties of final product
Avoid socially inefficient redundant research
Foster competition in the manufacture and sale of patent-dependent products immediately after patent expires
But:
+ - Often invoked when applicant amends application
+ - Pertinent provisions
Original disclosure must show that the applicant was then "in possession" of the invention eventually claimed
+ - Recently applied by CAFC outside of the extension context: applicant must describe the invention itself, not just how to make and use it (enablement)
In 1980s, 13 scientists at Harvard, MIT, and Whitehead Institute identified Nuclear Factor Kappa (NF-kB), a protein that affects gene expression
On the basis of their discovery of the way the protein worked, they postulated that suppressing NF-kB activity could reduce symptoms of cancer, AIDS, and sepsis
They proposed that such suppression could be achieved by (a) specific inhibitors; (b) interfering molecules; and (c) decoy molecules
+ - Universities applied for were granted patents on methods using any of substances that will have this suppressing effect
+ - ~ claims
80. [A method for modifying effects of external influences on a eukaryotic cell, which external influences induce NF-κB-mediated intracellular signaling, the method comprising altering NF-κB activity in the cells such that NF-κB-mediated effects of external influences are modified, wherein NF-κB activity in the cell is reduced] wherein reducing NF-κB activity comprises reducing binding of NF-κB to NF-κB recognition sites on genes which are transcriptionally regulated by NF-κB.
95. [A method for reducing, in eukaryotic cells, the level of expression of genes which are activated by extracellular influences which induce NF-κB-mediated intracellular signaling, the method comprising reducing NF-κB activity in the cells such that expression of said genes is reduced], carried out on human cells.
144. [A method for reducing bacterial lipopolysaccharide-induced expression of cytokines in mammalian cells, which method comprises reducing NF-κB activity in the cells so as to reduce bacterial lipopolysaccharide-induced expression of said cytokines in the cells] wherein reducing NF-κB activity comprises reducing binding of NF-κB to NF-κB recognition sites on genes which are transcriptionally regulated by NF-κB.
145. [A method for reducing bacterial lipopolysaccharide-induced expression of cytokines in mammalian cells, which method comprises reducing NF-κB activity in the cells so as to reduce bacterial lipopolysaccharide-induced expression of said cytokines in the cells], carried out on human cells.
“[A] generic claim may define the boundaries of a vast genus of chemical compounds, and yet the question may still remain whether the specification, including original claim language, demonstrates that the applicant has invented species sufficient to support a claim to a genus. The problem is especially acute with genus claims that use functional language to define the boundaries of a claimed genus. In such a case, the functional claim may simply claim a desired result, and may do so without describing species that achieve that result. But the specification must demonstrate that the applicant has made a generic invention that achieves the claimed result and do so by showing that the applicant has invented species sufficient to support a claim to the functionally-defined genus.”
_[A] sufficient description of a genus ... requires the disclosure of either a representative number of species falling within the scope of the genus or structural features common to the members of the genus so that one of skill in the art can “visualize or recognize” the members of the genus.”_
+ - Resistance to this expansive reading of “written description” has been strong, but so far unavailing
“The statutory requirement of particularity and distinctness in claims is met only when [the claims] clearly distinguish what is claimed from what went before in the art and clearly circumscribe what is foreclosed from future enterprise.”
+ - When a claim in an issued patent is challenged, courts are more forgiving than during patent prosecution
+ - The greater the risk that a claim will encroach on prior art, the more demanding will be the courts
+ - If information in the specification is sufficient to enable a PHOSITA to resolve the ambiguity, indefiniteness is not fatal
+ - If a claim is ambiguous because it its susceptible of two possible interpretations, court may be willing to save the claim by adopting the narrower of the two interpretations
Most relevant section for statutory basis is Chapter 2, Article 42: [2.42.(2)]: "A patent application filed under paragraph (1) shall be accompanied by a specification containing the description of the invention and the claims, necessary drawings, and an abstract."
+ - Yet many other sections (especially in Chapters I and II) detail specifics related to application requirements:
Enablement, written description, and definiteness are intended for disclosure. Generally the same as the US, except the best mode approach
+ - A person shall be entitled to a patent unless... (g)(1) during the course of an interference conducted under section 135 or section 291, another inventor involved therein establishes to the extent permitted in section 104, that before such person's invention thereof the invention was made by such other inventor and not abandoned, suppressed, or concealed, or
+ - (2) before such person's invention thereof, the invention was <u>made in this country</u> by another inventor who had not abandoned, suppressed, or concealed it.
In determining priority of invention under this subsection, there shall be considered not only the respective dates of conception and reduction to practice of the invention, but also the reasonable diligence of one who was first to conceive and last to reduce to practice, from a time prior to conception by the other.
+ - Formulation of the complete means of solving a problem sufficiently detailed that a PHOSITA could RTP without further research
Idea must encompass all parts of the invention
Question of law, not fact
+ - Need corroborating evidence
Peeler (CCPA 1976)
legitimate excuse for delay: working on refining the invention, and refinements are reflected in ultimate patent application
+ - concealment, followed by renewed efforts to obtain a patent: applicant can claim priority date of renewal of effort
renewed activity in response to appearance of a competitor does not count
a person shall be entitled to a patent unless he did not himself invent the subject matter sought to patented
i.e., the disclosure by Y must have met standard enablement requirements and must have encompassed all elements of the invention
"When an invention is made by two or more persons jointly, they shall apply for patent jointly and each make the required oath, except as otherwise provided in this title. Inventors may apply for a patent jointly even though (1) they did not physically work together or at the same time, (2) each did not make the same type of amount of contribution, or (3) each did not make a contribution to the subject matter of every claim of the patent."
Each contributes significantly (measured by quality) to conception or RTP of at least one of the claims, in a fashion other than the explanation of familiar principles
In the absence of any agreement to the contrary, each of the joint owners of a patent may make, use, offer to sell, or sell the patented invention within the United States, or import the patented invention into the United States, without the consent of and without accounting to the other owners.
a person shall be entitled to a patent unless -- (a) the invention was known or used by others in this country ..., before the invention thereof by the applicant for patent
“Section 102(a) establishes that a person can not patent what was already known to others. If the invention was known to or used by others in this country before the date of the patentee's invention, the later inventor has not contributed to the store of knowledge, and has no entitlement to a patent.”
+ - “Accordingly, in order to invalidate a patent based on prior knowledge or use, that knowledge or use must have been available to the public.”
See Carella v. Starlight Archery, 804 F.2d 135, 139, 231 U.S.P.Q. 644, 646 (Fed. Cir. 1986) (the § 102(a) language "known or used by others in this country" means knowledge or use which is accessible to the public);
35 U.S.C. § 102(a) reviser's note (1952) (noting that " 'known' has been held to mean 'publicly known' " and that "no change in the language is made at this time");
P.J. Federico, Commentary on the New Patent Act (1954) reprinted in 75 J. PAT. TRADEMARK OFF. SOC'Y Y 161, 178 (1993) ("interpretation [of § 102(a) ] by the courts excludes various kinds of private knowledge not known to the public"; these "narrowing interpretations are not changed").
See also Coffin v. Ogden, 85 U.S. (18 Wall.) 120, 124-25, 21 L. Ed. 821 (1873) (accessible hence anticipating prior use); Gayler v. Wilder, 51 U.S. (10 How.) 477, 497-98, 13 L. Ed. 504 (1850) (nonaccessible hence nonanticipating prior use).
A person shall be entitled to a patent unless -- (a) the invention was ... patented or described in a printed publication in this or a foreign country, before the invention thereof by the applicant for patent
+ - 102(e)
A person shall be entitled to a patent unless ... (e) the invention was described in (1) an application for patent, published under section 122(b), by another filed in the United States before the invention by the applicant for patent or (2) a patent granted on an application for patent by another filed in the United States before the invention by the applicant for patent, except that an international applicant filed under the treaty defined in Section 351(a) shall have the effects for the purposes of this sub section of an application filed in the United States only if the international application designated the United States and was published under Article 21(2) of such treaty in the English language
applies only to descriptions of the invention in prior patent applications by others, not claims in prior patent applications by others
+ - Each element of the claimed invention is disclosed in a single prior-art reference or embodied in a single prior-art device or practice
+ -
Inadvertent prior art
does not count
+ - Enablement
+ - Description of the invention must be enabling, taking into account the level of ordinary skill in the pertinent art
+ - But a device or practice embodying the invention need not be enabling
Disclosure of a species anticipates a genus, but not vice versa
+ - Requires “definite sale or offer to sell"
+ - For the bar to apply, the technology that is offered for sale must be sufficiently well developed as to be “ready for patenting” on the critical date
~ Pfaff, 525 U.S. 55 (SCOTUS 1998)
“Ready for patenting” can be shown either “by proof of reduction to practice before the critical date; or by proof that prior to the critical date the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention.”
+ - Gaps between the challenged claims and the thing sold
+ - public sales of fruits of concealed process?
+ -
Narrow "experimental
use" exception
+ - Geographic scope
A person shall be entitled to a patent unless ... (b) the invention was in public use ... in this country ..., more than one year prior to the date of the application for patent in the United States
Conical bolts in a safe
“The invention was complete in those safes. It was capable of producing the results sought to be accomplished, though not as thoroughly as with the use of welded steel and iron plates. The construction and arrangement and purpose and mode of operation and use of the bolts in the safes were necessarily known to the workmen who put them in. They were, it is true, hidden from view after the safes were completed, and it required a destruction of the safe to bring them into view. But this was no concealment of them or use of them in secret. They had no more concealment than was inseparable from any legitimate use of them.
+ - Also no experimental-use defense
As to the use's being experimental, it is not shown that any attempt was made to see if the plates of the safes could be stripped off, and thus to prove whether or not the conical bolts were efficient. The safes were sold, and apparently no experiment and no experimental use were thought to be necessary. The idea of a use for experiment was an afterthought. An invention of the kind might be in use and no burglarious attempt be ever made to enter the safe, and it might be said that the use of the invention was always experimental until the burglarious attempt should be made, and so the use would never be other than experimental. But it is apparent that there was no experimental use in this case, either intended or actual. The foregoing views, which are controlling to show that claim 3 of the patent in suit cannot be sustained, are in accordance with those announced by this Court in Egbert v. Lippmann
~ Beachcombers (CAFC 1994); kaleidescope at a party = public
Baxter (CAFC 1996): centrifuge in a laboratory = public
Express or tacit agreements by persons permitted to use the invention not to make it public prevents operation of the bar
“ To determine whether a use is "experimental," a question of law, the totality of the circumstances must be considered, including various objective indicia of experimentation surrounding the use, such as the number of prototypes and duration of testing, whether records or progress reports were made concerning the testing, the existence of a secrecy agreement between the patentee and the party performing the testing, whether the patentee received compensation for the use of the invention, and the extent of control the inventor maintained over the testing.... The last factor of control is critically important, because, if the inventor has no control over the alleged experiments, he is not experimenting. If he does not inquire about the testing or receive reports concerning the results, similarly, he is not experimenting.
“ In order to justify a determination that legally sufficient experimentation has occurred, there must be present certain minimal indicia. The framework might be quite formal, as may be expected when large corporations conduct experiments, governed by contracts and explicit written obligations. When individual inventors or small business units are involved, however, less formal and seemingly casual experiments can be expected. Such less formal experiments may be deemed legally sufficient to avoid the public use bar, but only if they demonstrate the presence of the same basic elements that are required to validate any experimental program. ...The question framed on this appeal is whether Lough's alleged experiments lacked enough of these required indicia so that his efforts cannot, as a matter of law, be recognized as experimental.
Suppose I try out an invention in public, then add a minor feature that improves it, file patent application for the improved version. As of what date am I barred?
+ - To create a bar, the thing in public use must be:
A person shall be entitled to a patent unless ... (b) the invention was patented or described in a printed publication in this or a foreign country..., more than one year prior to the date of the application for patent in the United States
“The factors relevant to the facts of this case are: the length of time the display was exhibited, the expertise of the target audience, the existence (or lack thereof) of reasonable expectations that the material displayed would not be copied, and the simplicity or ease with which the material displayed could have been copied.”
Posting a paper on one’s own FTP servers and providing the address to the chair of conference panel is not printed publication
Remand for reconsideration of a borderline case in light of the following factors:
“These decisions illustrate some common considerations about materials that are distributed at meetings or conferences. As relevant to this case, the size and nature of the meetings and whether they are open to people interested in the subject matter of the material disclosed are important considerations. Another factor is whether there is an expectation of confidentiality between the distributor and the recipients of the materials. Even if there is no formal, legal obligation of confidentiality, it still may be relevant to determine whether any policies or practices associated with a particular group meeting would give rise to an expectation that disclosures would remain confidential.”
A person shall be entitled to a patent unless ...(d) the invention was first patented or caused to be patented, or was the subject of an inventor's certificate, by the applicant or his legal representatives or assigns in a foreign country prior to the date of the application for patent in this country on an application for patent or inventor's certificate filed more than twelve months before the filing of the application in the United States
A person shall be entitled to a patent unless ... the claimed invention was described in a patent issued [to another] … or in [another’s] application for patent published … [that] was effectively filed before the effective filing date of the claimed invention.
+ - Invention was on sale anywhere in the world
A person shall be entitled to a patent unless -- (a) the invention was ... on sale before the effective filing date of the claimed invention
+ - Invention was in public use anywhere in the world
A person shall be entitled to a patent unless -- (a) the invention was ... in public use before the effective filing date of the claimed invention
+ - Invention was available to the public anywhere in the world
A person shall be entitled to a patent unless -- (a) the invention was ... otherwise available to the public before the effective filing date of the claimed invention
+ - Invention was Patented or Described in a Printed Publication anywhere in the world
A person shall be entitled to a patent unless -- (a) the invention was ... the claimed invention was patented, [or] described in a printed publication, ... before the effective filing date of the claimed invention
+ - Invention was described in an issued US patent or in a US patent application filed before applicant's filing date
102(a)(2): A person shall be entitled to a patent unless— ... the claimed invention was described in a patent issued [to another] … or **in [another’s] application for patent … [that] was effectively filed before the effective filing date of the claimed invention.**
This implements the new (qualified) “first-to-file” principle
102(b) now creates a set of 1-year exceptions to the prior art that will invalidate a patent under 102(a)
+ - Prior Art does not include disclosures made less than 1 year before filing date by the inventor or derived (directly or indirectly) from disclosures made by the inventor
+ - 35 USC 102(b)(1)(A)
“ A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention under subsection (a)(1) if— (A) the disclosure was made by the inventor or joint inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor...”
effect: no penalty for disclosing your invention prior to filing
“Derivation” determined in a “derivation” proceeding
+ - New provision will probably be construed broadly, to shield inventors from adverse effects of any of their own actions during grace period
+ - Prior Art does not include disclosures made less than 1 year before filing date by 3rd parties <u>after</u> a "public" disclosure by the inventor
“ A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention under subsection (a)(1) if— (B) the subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor.
The set of disclosures by an inventor that will immunize the inventor against adverse effects of subsequent prior art by 3rd parties may be narrower than the set of disclosures that an inventor is permitted to make (during the grace period) without forfeiting his/her own patent protection
+ - Prior Art does not include disclosures made less than 1 year before filing date by 3rd parties in patents or patent applications if:
(2) DISCLOSURES APPEARING IN APPLICATIONS AND PATENTS.—A disclosure shall not be prior art to a claimed invention under subsection (a)(2) if—
(A) the subject matter disclosed was obtained directly or indirectly from the inventor or a joint inventor;
(B) the subject matter disclosed had, before such subject matter was effectively filed under subsection (a)(2), been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or
(C) the subject matter disclosed and the claimed invention, not later than the effective filing date of the claimed invention, were owned by the same person or subject to an obligation of assignment to the same person.
+ - Net effects
+ - If P wants patent protection only in the US, new regime will create strong incentives to *disclose* as early as possible
+ - If P wants global protection, *file* as soon as possible
"Where at least two patent applications are filed for an identical invention on different dates, only the applicant who filed first is entitled to a patent on the invention."
If two parties file on same date, only the party agreed upon by all parties may obtain patent; if no agreement, no patent. Above two rules apply to filings of patent application and application for utility model registration. Other conditions detailed in Art. 36 (5) and (6).
1. When a person entitled to a patent has caused his/her invention to fall under any subparagraph of Article 29 (1)" (except for "where the relevant application has been laid open, or the patent has been registered and published, in the Republic of Korea or in any foreign country under a treaty or an Act");
Written statement (at time of filing date) = declaration of of intent to apply grace period
Evidentiary document (within 30 days of filing date) = must show the following
[post July 29, 2015]: extensions to window in which grace period may be applied allowed in the following cases:
(i) at any time prior to issuance of first office action (Notice of Preliminary Rejection, Notice of Allowance)
(ii) within time period for responding to a preliminary rejection
(iii) when filing request for reexamination
reasoned that a person having ordinary skill in the art may be able to disassemble and analyze a product covered by the invention to understand the invention
thus “invention publicly known or worked” = that disclosed under the condition that a person who does not have confidentiality obligations can readily grasp the content of the invention, whether or not that person recognizes the invention
[in re a chemical substance or medicine]: even if a product was publicly sold before the filing date, if a person skilled in the art was unable to determine its compositional ratio or components without undue effort, then it cannot be considered that the person could have recognized the invention in the product
2. When the invention falls under any subparagraph of Article 29 (1) contrary to the will of the person entitled to a patent."
Detailed rules and procedures follow in Art. 30 (2) and (3).
examples of scenarios from precedent cases determined to constitute disclosure against will of applicant:
an invention disclosed to the public intentionally of negligently by a licensee or agent
third party has invention disclosed to public as a result of threat, fraud, industrial espionage, or violation of confidentiality
To be patentable, an invention must require “more ingenuity and skill” than that held by “an ordinary mechanic acquainted with the business”
Doorknob made of clay or porcelain (rather than wood or metal) deemed to fail this requirement
“Under §103, the scope and content of the prior art are to be determined; differences between the prior art and the claims at issue are to be ascertained; and the level of ordinary skill in the pertinent art resolved. Against this background the obviousness or nonobviousness of the subject matter is determined. Such secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc., might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented.”
“ We begin by rejecting the rigid approach of the Court of Appeals. Throughout this Court’s engagement with the question of obviousness, our cases have set forth an expansive and flexible approach inconsistent with the way the Court of Appeals applied its TSM test here....”
“ Helpful insights, however, need not become rigid and mandatory formulas; and when it is so applied, the TSMtest is incompatible with our precedents. The obviousness analysis cannot be confined by a formalistic conception ofthe words teaching, suggestion, and motivation, or by overemphasis on the importance of published articles and the explicit content of issued patents.”
“ The same constricted analysis led the Court of Appeals to conclude, in error, that a patent claim cannot be proved obvious merely by showing that the combination of elements was “obvious to try.” ... When there is a design need or market pressure to solve a problem and there are a finite number of identified, predictable solutions, a person of ordinary skill has good reason to pursue the known options within his or her technical grasp. If this leads to the anticipated success, it is likely the product not of innovation but of ordinary skill and common sense. In that instance the fact that a combination was obvious to try might show that it was obvious under §103.”
“The combination of familiar elements according to known methods is likely to be obvious when it does no more than yield predictable results. “
“ When a work is available in one field of endeavor, design incentives and other market forces can prompt variations of it, either in the same field or a different one. If a person of ordinary skill can implement a predictable variation, §103 likely bars its patentability. For the same reason, if a technique has been used to improve one device, and a person of ordinary skill in the art would recognize that it would improve similar devices in the same way, using the technique is obvious unless its actual application is beyond his or her skill.”
“The second error of the Court of Appeals lay in its assumption that a person of ordinary skill attempting to solve a problem will be led only to those elements of prior art designed to solve the same problem. ... Common sense teaches, however, that familiar items may have obvious uses beyond their primary purposes, and in many cases a person of ordinary skill will be able to fit theteachings of multiple patents together like pieces of a puzzle.”
“ A factfinder should be aware, of course, of the distortion caused by hindsight bias and must be cautious of arguments reliant upon *ex post* reasoning. ... Rigid preventative rules that deny factfinders recourse to common sense, however, are neither necessary under our case law nor consistent with it.”
+ - a. We should not incur unnecessary social costs by extending monopoly protection to inventions that would have emerged (soon) even in the absence of the carrot of a patent
~ Roberts v. Sears (CA7 1983)(Posner, J.)
“ [T]he costs as well as benefits of patent protection are relevant to deciding which inventions should be patentable. The balance tips against protection when the invention is the sort that was likely to be made, and as soon, even if no one could have patented it. In such a case patent protection would have no good incentive effects but would have the usual bad monopoly effects.
All this is well recognized in the law. The Supreme Court in the _Graham_ case, referring to Thomas Jefferson's views on patent policy, said it was "the underlying policy of the patent system that 'the things which are worth to the public the embarrassment of an exclusive patent,' as Jefferson put it, must outweigh the restrictive effect of the limited patent monopoly. The inherent problem was to develop some means of weeding out those inventions which would not be disclosed or devised but for the inducement of a patent."
+ - The means chosen was the concept codified in the statutory term "obvious." The term identifies the cases in which patent protection is not necessary to induce invention and would therefore visit the costs of monopoly on the consuming public with no offsetting gains.
As Professor Kitch has explained, "the basic principle on which the non-obviousness test is based [is that] a patent should not be granted for an innovation unless the innovation would have been unlikely to have been developed absent the prospect of a patent . . . . The non-obviousness test makes an effort, necessarily an awkward one, to sort out those innovations that would not be developed absent a patent system." Kitch, Graham v. John Deere Co.: New Standards for Patents, 1966 Sup. Ct. Rev. 293, 301.
Now it is true that if the invention, though the sort of thing that ordinarily would be expected to take much time and toil to make, was made in a flash of genius, this does not make it "obvious." That is the force of the last sentence of section 103 ("Patentability shall not be negatived by the manner in which the invention was made"), as explained in the Reviser's Note. Much time and toil may have been spent in getting to the point where the spark of genius could be struck, and in any event people should not be encouraged to do drudge work by making it a condition of obtaining patent protection. But if a court thinks an invention for which a patent is being sought would have been made as soon or almost as soon as it was made even if there were no patent laws, then it must pronounce the invention obvious and the patent invalid.
b. The non-obviousness requirement helps offset distortions caused by risk aversion
~ Robert Merges, “Uncertainty and the Standard of Patentability” (1992), pp. 43-51
Patent doctrine tempered by non obviousness requirement increases the expected value of risky R&D investments more than the expected value of safe R&D investments
That, in turn, will mitigate the socially inefficient tendency of R&D managers to select safe investments instead of risky ones, even when the expected values of the former is less than that of the latter
+ - a. Only especially creative labor merits the reward of intellectual property
A ... version of the desert-for-labor argument has to do with the way in which the laborer can come to have special needs that can appropriately be met by the award of property rights. Suppose we argue as follows:
(a) Laborers sometimes become dependent on their products in a way connected to their identity as persons, so that the welfare
of the product is related directly to their (psychological) integrity or welfare as persons. Let us call this relation identity-dependence.
(b) Identity-dependence on the products of one's labor constitutes having a basic personal need for the welfare of those products.
(c) If a basic personal need is generated and sustained by social norms, and if one's meeting that personal need requires the help of additional social norms, then either i) the help should be given, or ii) the need-sustaining norms should be changed.
(d) Identity-dependence on the products of one's intellectual labor is generated and sustained by social norms that identify human excellence with authorship, originality, and singularity, and which encourage the author-identification of products.
(e) Ownership norms sometimes help meet the basic personal needs of identity-dependence on the products of one's intellectual labor.
+ - b. Locke’s “sufficiency” proviso forbids grants of (intellectual) property to things that would soon be invented by others
Extending patent protection to an invention that would have emerged (soon) leaves both other inventors and consumers worse off than if not such property rights were available
+ - Problem could be avoided if “independent invention” were a defense (as it is in copyright law)
“An inventor's patent does not deprive others of an object which would not exist if not for the inventor. Yet patents would have this effect on others who independently invent the object. Therefore, these independent inventors, upon whom the burden of proving independent discovery may rest, should not be excluded from utilizing their own invention as they wish (including selling it to others). Furthermore, a known inventor drastically lessens the chances of actual independent invention. For persons who know of an invention usually will not try to reinvent it, and the notion of independent discovery here would be murky at best. Yet we may assume that in the absence of knowledge of the invention, for independent discovery.”
(a) A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102 of this title, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. Patentability shall not be negatived by the manner in which the invention was made.
+ - (b) [Biotechnological Processes]
+ -
(1) Notwithstanding subsection (a), and upon
timely election by the applicant for patent to
proceed under this subsection, a biotechnological process using or resulting in a composition of matter that is novel under section 102 and nonobvious under subsection (a) of this section shall be considered nonobvious if--
(A) claims to the process and the composition
of matter are contained in either the same
application for patent or in separate applications having the same effective filing date; and
(B) the composition of matter, and the process
at the time it was invented, were owned by the
same person or subject to an obligation of
assignment to the same person.
+ - (2) A patent issued on a process under paragraph (1)--
(A) shall also contain the claims to the
composition of matter used in or made
by that process, or
+ -
(3) For purposes of paragraph (1), the
term "biotechnological process" means--
+ -
(A) a process of genetically altering or
otherwise inducing a single- or
multi-celled organism to--
(B) cell fusion procedures yielding a
cell line that expresses a specific protein,
such as a monoclonal antibody; and
(C) a method of using a product produced
by a process defined by subparagraph
(A) or (B), or a combination of
subparagraphs (A) and (B).
+ - (c) ["Bass disqualifier"]
(1) Subject matter developed by another person, which qualifies as prior art only under one or more of subsections (e), (f), and (g) of section 102 of this title, shall not preclude patentability under this section where the subject matter and the claimed invention were, at the time the claimed invention was made, owned by the same person or subject to an obligation of assignment to the same person.
+ - (2) For purposes of this subsection, subject matter developed by another person and a claimed invention shall be deemed to have been owned by the same person or subject to an obligation of assignment to the same person if--
(A) the claimed invention was made by or on behalf of parties to a joint research agreement that was in effect on or before the date the claimed invention was made;
(B) the claimed invention was made as a result of activities undertaken within the scope of the joint research agreement; and
(C) the application for patent for the claimed invention discloses or is amended to disclose the names of the parties to the joint research agreement.
(3) For purposes of paragraph (2), the term
"joint research agreement" means a written
contract, grant, or cooperative agreement
entered into by two or more persons or entities
for the performance of experimental,
developmental, or research work in the field
of the claimed invention.
A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.
must show "nexus" between the invention and the commercial success of the product (or process) embodying it
At the time of the invention, would it have been obvious to a PHOSITA to try the particularly combination of elements that eventually produced the invention? If so, the invention is obvious.
rejected by CAFC in In re Deuel (1995)
Revived by KSR (SCOTUS 2007)
Current scope of the test varies by CAFC panels
(1) An invention having industrial applicability, other than the following, is patentable:
1. An invention publicly known or practiced in the Republic of Korea or in a foreign country prior to the filing of a patent application;
2. An invention published in a publication distributed in the Republic of Korea or in a foreign country or an invention made available to the public via telecommunications lines prior to the filing of a patent application.
(2) Notwithstanding paragraph (1), an invention that can be made easily by a person with ordinary skill in the art to which the invention pertains, from the invention referred in any subparagraph of paragraph (1), prior to the filing of a patent application, shall not be patentable.
~ On how to read prior art in making an inventive step determination
“...to determine the inventiveness of an invention, the prior art should be considered in its entirety...not just from the portion of prior art...”
“...when a different prior art is presented which is contradictory to the (portion of) prior art, then this prior art reference must also be considered...when determining the inventive step.”
“ If the parameters are expressed by changing only the expression of the properties of characteristics of a publicly known product by a prior invention, the parameter invention must be regarded as being essentially the same or similar to the prior invention, thereby lacking the novelty and inventive step. On the other hand, the inventive step may not be denied if the parameter as a technical means for solving a different problem from publicly known inventions has significance, and the descriptions that there is a causal relationship between the parameter and the peculiar effect such as heterogeneous effect is described in the specification in detail, or a person having ordinary skill in the art (a “skilled person”) is able to infer the above significance as a technical means and the causal relationship from the description of the specification. Even if the above technical significance cannot be recognized with the introduction of the parameter itself, if the parameter invention can also be a numerical limitation invention and significant difference occurs between in and out of a limited numerical range, the inventive step should not be denied. ”
“‘inventive step’ means a feature of an invention that involves technical advance as compared to the existing knowledge or having economic significance or both and that makes the invention not obvious to a person skilled in the art” Art. 2(ja)
Inventor identifies the essence or heart of her invention
The government (typically a court) determines the scope of her monopoly power/property right in the course of infringement litigation
Primary criterion in determining scope = amount of contribution to technology/society
“[W]ords will be given their ordinary and accustomed meaning unless it appears that the inventor used them differently.”
~ Miken Composites (CAFC 2008)
Claim 1: A bat, comprising: a hollow tubular bat frame having a circular cross-section; and an insert positioned within the frame, the insert having a circular cross-section, the insert having first and second ends adjoining the tubular frame, the insert being separated from the tubular frame by a gap forming at least part of an annular shape along a central portion between said first and second ends,
the frame elastically deflectable across the gap to operably engage the insert along a portion of the insert between the insert first and second ends.
Claim 18: A bat, comprising: a hollow tubular bat frame having a small-diameter handle portion and a large-diameter impact portion having a circular cross-section with an inner and outer diameter; at least one insert having a substantially circular cross-section with an outer diameter less than the inner diameter of the frame impact portion, the insert being held within the impact portion; and the impact portion being inwardly elastically deflectable
such to establish a tight interference fit between the insert and the impact portion.
An internal component is first fabricated by rolling alternate layers of preimpregnated carbon fiber reinforced/epoxy tape, polypropylene shrink tape and nylon shrink tape over a mandrel, curing the component at an elevated temperature, removing the external layers of shrink tape and then dipping the component into a release agent. Each internal component is comprised of two layers of carbon fiber reinforced epoxy/tape and the placement and quantity of shrink tape layers vary slightly depending on the specific bat. Dry pre-woven fabrics are then tightly drawn over the internal component, and the entire assembly is infused with resin.
We note first that nothing in the claims or specification indicates, explicitly or implicitly, that the inventor used the term in a novel way or intended to impart a novel meaning to it. To the contrary, the claims and written description of the ′ 398 patent consistently use the term “insert” in the sense of its ordinary meaning as “something inserted or intended for insertion.” Webster's II New College Dictionary (3d ed.2005); see also Webster's Third New International Dictionary Unabridged (1993) (defining “insert” as “something that is inserted or is for insertion”); ′398 patent col.3 l.5 (“the insert is inserted into the tubular frame 11”); id. col.4 ll.24-28 (“the insert 18 is coated with the lubricant before being inserted into the tubular frame 11”).
Had the patentee, “who was responsible for drafting and prosecuting the patent, intended something different, it could have prevented this result through clearer drafting.” ...
+ - Moreover, the parties have presented no evidence to suggest that the term “insert” in the context of the patent has a particular meaning differing from the ordinary and customary meaning in the field of art encompassed by the ′398 patent. The term “insert” is a common term used to denote structure. To contend, however, as Wilson does, that it does not matter whether an insert is placed into a pre-existing frame or whether a frame is built around it ignores that ordinary and customary meaning, notwithstanding Wilson's attempts to categorize the term “insert” as “purely structural.”
The issue would have been different if the claims contained the language argued in Wilson's briefs; to wit, “internal structural member,” Wilson Br. at 31, 38, or “multi-wall product,” Reply Br. at 3, but they do not. It is the language of the claims not the argument that governs.
~ for criticism of the PHOSITA perspective, see Golden (2008)
“ Crudely stated, if claims are to be the fundamental determinants of patent scope, the basic approach to construing claims should be one of reasonableness according to (1) established legal principles, (2) a well-informed reading of the patent and its prosecution history, and (3) the mores and understandings of claims' relevant interpretive community. The ordinary artisan perspective is not well designed to implement this approach. Ordinary engineers or scientists typically do not form a well-constituted interpretive community for patent claims. Consequently, their views on claim meaning might be too legally ill-informed and idiosyncratic to permit substantial predictability.”
“ A better perspective to associate with claim construction is that of _a patent attorney having access to the knowledge of a person of technological skill_. Such an attorney-with-artisan perspective would make use of the artisan's knowledge to help ensure claim construction's technological sensibility. But it would more generally follow rules and techniques for claim construction that are publicly known and anchored in the practices of an active interpretive community. _Claim construction law and practice are already mostly in agreement with this attorney-with-artisan perspective, and substantially in conflict with the ordinary artisan perspective._ Further, use of an ordinary artisan perspective for claim construction has a surprisingly weak historical pedigree. Recognition that an attorney-with-artisan perspective governs claim construction should promote the law's transparency, coherence, and predictability, as well as providing a more sensible reference point for its improvement and critique.”
Strictly speaking, through the eyes of a PHOSITA at the time the invention was made -- typically, the effective filing date of the patent application
Specification includes the following language: “As used herein, the expression “water-soluble polydextrose” (also known as polyglucose or poly-D-glucose) specifically refers to the water-soluble polydextrose prepared by melting and heating dextrose (also known as glucose or D-glucose), preferably with about 5-15% by weight of sorbitol present, in the presence of a catalytic amount (about 0.5 to 3.0 mol %) of citric acid.”
Held: “Having explicitly defined this term as limited to that prepared with a citric acid catalyst, this effected a disclaimer of the other prior art acids. Claims are not correctly construed to cover what was expressly disclaimed.”
“[A] claim interpretation that would exclude the inventor's device is rarely the correct interpretation”
“ To what liberality of construction these claims are entitled depends, to a certain extent, upon the character of the invention and whether it is what is termed, in ordinary parlance, a "pioneer." This word, although used somewhat loosely, is commonly understood to denote a patent covering a function never before performed, a wholly novel device, or one of such novelty and importance as to mark a distinct step in the progress of the art, as distinguished from a mere improvement or perfection of what had gone before.
Most conspicuous examples of such patents are the one to Howe, of the sewing machine; to Morse, of the electrical telegraph, and to Bell, of the telephone.
The record in this case would indicate that the same honorable appellation might be safely bestowed upon the original air brake of Westinghouse, and perhaps also upon his automatic brake. In view of the fact that the invention in this case was never put into successful operation, and was to a limited extent anticipated by the Boyden patent of 1883, it is perhaps an unwarrantable extension of the term to speak of it as a "pioneer," although the principle involved subsequently, and through improvements upon this invention, became one of great value to the public.
The fact that this invention was first in the line of those which resulted in placing it within the power of an engineer, running a long train, to stop in about half the time and half the distance within which any similar train had stopped, is certainly deserving of recognition, and _entitles the patent to a liberality of construction which would not be accorded to an ordinary improvement upon prior devices_.
At the same time, as hereinafter observed, this liberality must be exercised in subordination to the general principle above stated -- that the function of a machine cannot be patented, and hence that the fact that the defendants' machine performs the same function is not conclusive that it is an infringement.
Kimberly A. Moore, Markman Eight Years Later: Is Claim Construction More Predictable?, 9 LEWIS & CLARK L. REV. 231 (2005)
Gretchen Ann Bender, Uncertainty and Unpredictability in Patent Litigation, 8 J. INTELL. PROP. L. 175 (2001)
Christian A. Chu, Empirical Analysis of the Federal Circuit’s Claim Construction Trends,
16 BERKELEY TECH. L.J. 1075 (2001)
Andrew T. Zidel, Patent Claim Construction in the Trial Courts, 33 SETON HALL L. REV. 711 (2003)
"[T]here is no magic formula or catechism for conducting claim construction. Nor is the court barred from considering any particular sources or required to analyze sources in any specific sequence, as long as those sources are not used to contradict claim meaning that is unambiguous in light of the intrinsic evidence. ... The sequence of steps used by the judge in consulting various sources is not important; what matters is for the court to attach the appropriate weight to be assigned to those sources in light of the statutes and policies that inform patent law. In [prior caselaw], we did not attempt to provide a rigid algorithm for claim construction, but simply attempted to explain why, in general, certain types of evidence are more valuable than others."
An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof.
Only possible with respect to combination patents
“Statutory equivalents” interpreted in much the same fashion as judicial equivalents (see below)
+ - Statutory equivalents must be in existence at the time the patent is granted
To satisfy “claim definiteness” requirement, the specification must set forth the structure that constitutes the means of achieving the function
Popularity has declined because of narrowness of scope
~ Made possible by the decision in _Markman_ (SCOTUS 1996)
Claim construction made by judge, not jury, in hearing separate from determination of infringement at trial
possible placement of the hearing
Standard of Review
CAFC review of PTAB constructions are governed (for now) by the same standards applicable to District Court rulings
+ - The scope of protection of a patented invention shall be determined by the descriptions of the claims.
Procedure
When the meaning of the terms within a claim is not clear, one may to look to the patent specification and drawings to gain a better understanding of the meaning of the terms.
If the terms are not understandable even after consulting the specification and drawings, one would seek how a person of the ordinary skill in the art would have interpreted the terms at the time of the invention.
The prosecution history may be taken into consideration as well, but usually at the request of the parties.
(1) The term of a patent shall begin on the registration date of the grant of the patent right under Article 87 (Registration of Grant of Patents and Publication of Registration) (1) and last for 20 years from the filing date of the patent application.
(2) Where a patent is granted for a patent application filed by the legitimate right-holder under Article 34 (Patent Applications Filed by Unentitled Persons and Protection of Legitimate Right-Holders) or 35 (Patents Granted to Unentitled Persons and Protection of Legitimate Right-Holders), the term of the patent under paragraph (1) shall begin on the day immediately following the filing date of the patent application filed by the unentitled person.
(1) Notwithstanding Article 88 (Term of Patent)(1), the term of a patent on an invention may be extended only once by up to five years to compensate for the period during which the invention cannot be executed, if the invention is specified by Presidential Decree and requires permission, registration, etc. under any other statute (hereinafter referred to as "permission, etc.") to execute patented invention but it takes a long time to undergo necessary tests for validity, safety, etc. for such permission, registration, etc.
(2) For the purposes of paragraph (1), the period required due to a cause attributable to the person who has obtained permission, etc. shall not be included in "period during which the invention cannot be executed" in paragraph (1).
The effects of a patent, the term of which has been extended under Article 90 (Applications for Registration of Extended Patent Terms by Permission, etc.) (4), shall extend only to executing the patented invention on the things on which permission, etc. for registration of the extension is based (things used for specified purposes, if the purposes of such things are specified in the permission, etc.).
Article 90 (Applications for Registration of Extended Patent Terms by Permission, etc.)
Article 91 (Determination to Reject Applications for Registration of Extended Patent Term by Permission, etc.)
Article 92 (Determination, etc. to Register Extended Patent Term by Permission, etc.)
Article 92-2 (Extension of Term of Patent Right Following Delayed Registration)
Article 92-3 (Application to Register Extension of Term of Patent Right Following Delayed Registration)
Article 92-4 (Decision to Reject Application for Registration of Extension of Term of Patent Right Following Delayed Registration)
Article 92-5 (Decision, etc. to Register Extension of Term of Patent Right Following Delayed Registration)
Article 93 (Provisions Applicable Mutatis Mutandis)
Articles 57 (Examinations by Examiners) (1), 63 (Notice of Grounds for Rejection), 67 (Formalities for Decision on Patentability) and subparagraphs 1 through 5 and 7 of Article 148 (Exclusion of Administrative Patent Judges) shall apply mutatis mutandis to examination of an application for registration of an extended term of a patent.
According to Enforcement Decree of the Korean Patent Act (of April 3, 2013),” patent term extension only possible based on initial marketing approval for a new substance whose active moiety has a novel chemical structure”
Thus “Patent Court decision suggests that it is possible to obtain patent term extension for patents relating to stereoisomers which have a different mechanism of action and a different therapeutic effect from other stereoisomers, owning to their unique chemical composition.”
“Therefore, development of new stereoisomers would be a promising approach to secure second generation patents with the possible development of patent term extension in Korea.”
Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent
(3) "Working" of an invention in this Act means the following acts:
(i) in the case of an invention of a product (including a computer program, etc., the same shall apply hereinafter), producing, using, assigning, etc. (assigning and leasing and, in the case where the product is a computer program, etc., including providing through an electric telecommunication line, the same shall apply hereinafter), exporting or importing, or offering for assignment, etc. (including displaying for the purpose of assignment, etc., the same shall apply hereinafter) thereof;
(ii) in the case of an invention of a process, the use thereof; and
(iii) in the case of an invention of a process for producing a product, in addition to the action as provided in the preceding item, acts of using, assigning, etc., exporting or importing, or offering for assignment, etc. the product produced by the process.
A patentee shall have the exclusive right to work the patented invention as a business; provided, however, that where an exclusive license regarding the patent right is granted to a licensee, this shall not apply to the extent that the exclusive licensee is licensed to exclusively work the patented invention.
For the patent right of an invention or a utility model, the scope of protection shall be confined to what is claimed, and the written description and the pictures attached may be used to explain what is claimed.
Facts: combination patent on a shrimp deveining machine
Holding (5/4): Manufacturing all components of a machine covered by a combination patent, then shipping those components overseas for assembly there, is not “making”
Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components
are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer
ordinarily, patentee must prove that a single legal entity practiced each element of the claim -- either literally or through equivalents
+ - if some elements are practiced by entity #1 and some by entity #2 (e.g., customers), patentee can prevail on joint infringement theory, but only if entity #1 "controls or directs" the conduct of entity #2 or they form a “joint enterprise”
“Directs or controls” includes situations in which E1 conditions E2’s participation in an activity or receipt of a benefit upon performance of a step of a patented method and establishes the manner or timing of that performance
+ - “Joint enterprise” requires (only):
Possible alternative justification: hostility to planned obsolescence and use-based differential pricing
Replacing the worn-out fabric of a patented convertible top is “repair”
Upgrading a patented fish canning machine, including changing the can size from 1 pound to 5 ounces is “repair”
Quality Tubing (SD Tex 1999): offer to sell, made in U.S. is not infringement where neither manufacture nor delivery will occur in U.S.
271(a): Except as otherwise provided in this title, whoever without authority ... imports into the United States any patented invention during the term of the patent therefor, infringes the patent.
In an action for infringement of a process patent, no remedy may be granted for infringement on account of the noncommercial use or retail sale of a product unless there is no adequate remedy under this title for infringement on account of the importation or other use, offer to sell, or sale of that product.
A product which is made by a patented process will, for purposes of this title, not be considered to be so made after—
element = any limitation found in the claim language
Roughly speaking, a limitation is a characteristic or aspect identified in a claim
CAFC acknowledges that what qualifies as a limitation depends on the level of generality one selects -- but has not provided guidance concerning the choice of level of generality
D’s product must perform substantially the same function in substantially the same way to achieve the same result as P’s product
a factor in the analysis is whether PHOSITA, at the time of the infringement, knew of the interchangeability of P's and D's components
However, DOE can be used to reach equivalent technologies not in existence at the time of the patent grant
“ Infringement may be found under the doctrine of equivalents if an accused product "performs substantially the same overall function or work, in substantially the same way, to obtain substantially the same overall result as the claimed invention." ...
+ - “Even if this test is met, however, there can be no infringement if the asserted scope of equivalency of what is literally claimed would encompass the prior art. ... ..
“ [A] patentee should not be able to obtain, under the doctrine of equivalents, coverage which he could not lawfully have obtained from the PTO by literal claims. ...
“The doctrine of equivalents exists to prevent a fraud on a patent, ... not to give a patentee something which he could not lawfully have obtained from the PTO had he tried. Thus, since prior art always limits what an inventor could have claimed, it limits the range of permissible equivalents of a claim.”
“This issue--whether an asserted range of equivalents would cover what is already in the public domain--is one of law, which we review de novo, ... but we presume that the jury resolved underlying evidentiary conflicts in Wilson's favor...”
The specific question before us, then, is whether Wilson has proved that a hypothetical claim, similar to claim 1 but broad enough to literally cover Dunlop's balls, could have been patentable. As we have explained above, Dunlop's balls are icosahedral balls with six great circles, five of which are intersected by dimples. The balls contain 432 to 480 dimples, 60 of which intersect great circles in amounts from 4 to 9 thousandths of an inch. In order for a hypothetical claim to cover Dunlop's balls, its limitations must permit 60 dimples to intersect the great circles by at least 9 thousandths of an inch. Thus, the issue is whether a hypothetical claim directed to an icosahedral ball having six great circles intersected by 60 dimples in amounts up to 9 thousandths of an inch could have been patentable in view of the prior art Uniroyal ball.
On the Uniroyal ball, the extent to which the dimples intersect the great circles is from 12 to 15 thousandths of an inch. Stated as a percentage of dimple radius, the intersection permitted in the hypothetical claim is 13% or less, and the dimples on the Uniroyal ball intersect by 17% to 21%. The number of dimples which intersect the great circles is also similar for the hypothetical claim and the prior art Uniroyal ball. The pertinent hypothetical claim limitation reads on any ball having 60 or less intersecting dimples. This limitation reads on the prior art Uniroyal ball, which has 30 intersecting dimples. If viewed in relative terms, the hypothetical claim limitation reads on any ball which has less than 14% of its dimples intersecting great circles. Roughly 12% of the dimples on the Uniroyal ball intersect great circles.
We hold that these differences are so slight and relatively minor that the hypothetical claim--which permits twice as many intersecting dimples, but with slightly smaller intersections--viewed as a whole would have been obvious in view of the Uniroyal ball. As Dunlop puts it, there is simply "no principled difference" between the hypothetical claim and the prior art Uniroyal ball. Accordingly, Wilson's claim 1 cannot be given a range of equivalents broad enough to encompass the accused Dunlop balls.
rationale: purpose of the doctrine is to protect P against evasion through use of unanticipatable substitutes; it should not apply when P was aware of substitutes
+ - Principle: Patentee is bound by representations made during patent prosecution and may not use doctrine of equivalents to recover territory she gave up in the course of patent prosecution
Schriber-Schroth (SCOTUS 1940): an applicant “may not, by resort to the doctrine of equivalents, give to an allowed claim [the] scope which it might have had without the [narrowing] amendments.”
History
+ - Some panels adopt “Flexible Bar” approach: Patentee permitted to reclaim ground surrendered during prosecution if she could show that the surrender was unnecessary to obtain the patent
+ - Others adopt “Complete Bar” approach
Adopt rebuttable presumption that a limitation added in the course of patent prosecution was necessary to obtain the patent
Did not resolve the intra-circuit split
+ - 1. A narrowing amendment made to satisfy any requirement of the Patent Statute may give rise to an estoppel
+ - 2. Estoppel does not apply, however, when:
Patentee bears the burden of proof on issue #2
Rationale: the imperfections of language
The patent laws “promote the Progress of Science and useful Arts” by rewarding innovation with a temporary monopoly. The monopoly is a property right; and like any property right, its boundaries should be clear. This clarity is essential to promote progress, because it enables efficient investment in innovation. A patent holder should know what he owns, and the public should know what he does not. For this reason, the patent laws require inventors to describe their work in “full, clear, concise, and exact terms,” as part of the delicate balance the law attempts to maintain between inventors, who rely on the promise of the law to bring the invention forth, and the public, which should be encouraged to pursue innovations, creations, and new ideas beyond the inventor’s exclusive rights.
Unfortunately, the nature of language makes it impossible to capture the essence of a thing in a patent application. The inventor who chooses to patent an invention and disclose it to the public, rather than exploit it in secret, bears the risk that others will devote their efforts toward exploiting the limits of the patent’s language:
“An invention exists most importantly as a tangible structure or a series of drawings. A verbal portrayal is usually an afterthought written to satisfy the requirements of patent law. This conversion of machine to words allows for unintended idea gaps which cannot be satisfactorily filled. Often the invention is novel and words do not exist to describe it. The dictionary does not always keep abreast of the inventor. It cannot. Things are not made for the sake of words, but words for things.”
The language in the patent claims may not capture every nuance of the invention or describe with complete precision the range of its novelty. If patents were always interpreted by their literal terms, their value would be greatly diminished. Unimportant and insubstantial substitutes for certain elements could defeat the patent, and its value to inventors could be destroyed by simple acts of copying. For this reason, the clearest rule of patent interpretation, literalism, may conserve judicial resources but is not necessarily the most efficient rule. The scope of a patent is not limited to its literal terms but instead embraces all equivalents to the claims described.
+ - scienter requirement
+ - necessary that the defendant knew that the combination for which he was supplying a part was both patented and infringing
but see Sandisk (ND Cal 2000): necessary only that the defendant knew of the patent and of the activity alleged to be infringing
rare exception to general pattern of strict liability
+ - defense: substantial noninfringing uses
cf. Sony; Grokster -- incorporating this principle into the interpretation of contributory infringement in copyright law
e.g., failure to take action to prevent corporate affiliates from engaging in infringing behavior is not inducement
Plaintiff must prove that defendant was aware of (a) the patent and (b) the acts induced by defendant constitute infringement
Defendant’s good-faith belief that the patent is invalid is not a defense
For the patent right of an invention or a utility model, the scope of protection shall be confined to what is claimed, and the written description and the pictures attached may be used to explain what is claimed.
(3) "Working" of an invention in this Act means the following acts:
(i) in the case of an invention of a product (including a computer program, etc., the same shall apply hereinafter), producing, using, assigning, etc. (assigning and leasing and, in the case where the product is a computer program, etc., including providing through an electric telecommunication line, the same shall apply hereinafter), exporting or importing, or offering for assignment, etc. (including displaying for the purpose of assignment, etc., the same shall apply hereinafter) thereof;
(ii) in the case of an invention of a process, the use thereof; and
(iii) in the case of an invention of a process for producing a product, in addition to the action as provided in the preceding item, acts of using, assigning, etc., exporting or importing, or offering for assignment, etc. the product produced by the process.
A patentee shall have the exclusive right to work the patented invention as a business; provided, however, that where an exclusive license regarding the patent right is granted to a licensee, this shall not apply to the extent that the exclusive licensee is licensed to exclusively work the patented invention.
(1) The term "invention" means the highly advanced creation of a technical idea utilizing the laws of nature
(2) The term "patented invention" means an invention for which a patent has been granted;
(3) The term "executing" means any of the following activities:
(a) An invention of a thing: Manufacturing, using, assigning, leasing, or importing the thing or offering to assign or lease the thing (including displaying the thing for the purpose of assignment or lease; hereinafter the same shall apply)
(b) An invention of a process: Using the process
(c) An invention of a process of manufacturing a thing: Using, assigning, leasing, or importing the thing manufactured by the process or offering to assign or lease the thing, other than the activities specified in item (b).
(1) A patentee or an exclusive licensee may file a complaint to seek injunction against, or prevention of, infringement against a person who infringes, or is likely to infringe, his/her rights.
(2) When a patentee or an exclusive licensee files a complaint under paragraph (1), he/she may demand the destruction of the means by which the infringement has been committed (including the products obtained by infringement if the relevant invention is a process for manufacturing the products), the removal of the facilities used for infringement, and other measures necessary to prevent infringement.
Conducting either of the following activities for business purposes shall be deemed infringement of a patent or an exclusive license:
(1) If the patent is for the invention of a thing: Manufacturing, selling, leasing, or importing the thing used exclusively for manufacturing the thing or offering to sell or lease the thing;
(2) If the patent is for the invention of a process: Manufacturing, selling, leasing, or importing a thing used exclusively for executing the process or offering to sell or lease the thing.
“There have been a few decisions by the Korean courts that found infringement by a principal infringer who had directed or controlled the other joint infringers who practiced relatively minor element of the method claim at issue. However, the jurisprudence on this particular issue has not been well settled and still being debated on by the scholars”
According to the decisions of Korean courts, even if all elements of a claim is not literally present in a product or a process, a finding of patent infringement is possible under the doctrine of equivalents if certain requirements are met, including the following:
(1) The accused product or process uses the same principle to solve the same problems as the invention of the patent
(2) The accused product or process use equivalent element or elements to achieve substantially the same effect as the corresponding claim element
(3) The equivalent element is obvious to a person of ordinary skill in the relevant art such that it is easily conceivable
(4) The accused product or process utilizes the prior art or what would have been obvious for the person of ordinary skill in the art to devise using the prior art
(5) The equivalent element was not purposefully excluded from the patent claims during the patent’s prosecution
Burden of proof:
The following shall be defenses in any action involving the validity or infringement of a patent and shall be pleaded:
**(1)** Noninfringement, absence of liability for infringement or unenforceability.
**(2)** Invalidity of the patent or any claim in suit on any ground specified in part II as a condition for patentability.
**(3)** Invalidity of the patent or any claim in suit for failure to comply with—
**(A)** any requirement of section 112, except that the failure to disclose the best mode shall not be a basis on which any claim of a patent may be canceled or held invalid or otherwise unenforceable; or
**(B)** any requirement of section 251.
**(4)** Any other fact or act made a defense by this title.
A patent shall be presumed valid. Each claim of a patent (whether in independent, dependent, or multiple dependent form) shall be presumed valid independently of the validity of other claims; dependent or multiple dependent claims shall be presumed valid even though dependent upon an invalid claim. The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity.
Finding of invalidity does not bind patentee in subsequent infringement suit against another defendant
Final judgment of invalidity *does* bind patentee in subsequent infringement suit against another defendant -- provided that patentee had a full and fair opportunity to litigate the issue
The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.
11th Amendment gives states, their instrumentalities, and their employees acting in official capacity immunity against infringement liability
+ - Covidien LP v. University of Florida Research Foundation Inc, Case Nos. IPR 2016-01274; -01275, and -01276 (PTAB January 25, 2017)
“On the whole, considering the nature of inter partes review and civil litigation, we conclude that the considerable resemblance between the two is sufficient to implicate the immunity afforded to the States by the Eleventh Amendment.”
“Although there are distinctions, such as in the scope of discovery, we observe that there is no requirement that the two types of proceedings be identical for sovereign immunity to apply to an administrative proceeding. Further, we note that there are several similarities between civil litigation and inter partes review that are not unlike those compared in Vas-Cath for interferences.”
+ - ~ Ericsson v. Univ. of Minnesota (PTAB, Dec. 19, 2017)
By bringing infringement suit in federal court, patentee waives sovereign immunity for responsive IPR proceeding
Federal courts have long recognized the right of tribes, as “domestic dependent nations” to refuse to be sued in almost all cases
+ - Seeking to capitalize on this immunity, Allergan recently assigned to the Saint Regis Mohawk Tribe a set of patents pertaining to Restasis; Tribe issues licenses to Allergan to exploit the patents; Tribe is paid $13M + possible $15M
Objective: prevent generic firms (e.g., Mylan) from challenging the validity of the patents in inter partes review
~ Saint Regis Mohawk Tribe v. Mylan (CAFC 2018)
Held: tribal sovereign immunity does not apply to IPR proceedings, because “immunity does not apply where the federal government acting through an agency engages in an investigative action or pursues an adjudicatory agency action”
Westinghouse pioneered and repeatedly improved the technology for train air brakes -- and obtained a patent on each improvement
Boyden’s brake significantly improved the efficiency of a mechanism for allowing a train engineer, in an emergency, to transfer compressed air from the main “train pipe” to the auxiliary reservoir underneath each train car, thus accelerating the application of the brakes in cars located a long distance from the locomotive
Holding: “But even if it be conceded that the Boyden device corresponds with the letter of the Westinghouse claims, that does not settle conclusively the question of infringement. We have repeatedly held that a charge of infringement is sometimes made out, though the letter of the claims be avoided. The converse is equally true. The patentee may bring the defendant within the letter of his claims, but if the latter has so far changed the principle of the device that the claims of the patent, literally construed, have ceased to represent his actual invention, he is as little subject to be adjudged an infringer as one who has violated the letter of a statute has to be convicted, when he has done nothing in conflict with its spirit and intent.”
Applied: Boyden’s invention “is a novel one and a manifest departure from the principle of the Westinghouse patent . . . because it solved at once in the simplest manner the problem of quick action, whereas the Westinghouse patent did not prove to be a success until certain additional members had been incorporated into it.”
“The Supreme Court referred to the reverse doctrine of equivalents in Graver Tank & Manufacturing Co. v. Linde Air Products Co., 339 U.S. 605, 608-609 (1950). It applies “where a device is so far changed in principle from a patented article that it performs the same or a similar function in a substantially different way, but nevertheless falls within the literal words of the claim.” In such a case, the reverse doctrine of equivalents “may be used to restrict the claim and defeat the patentee's action for infringement.”
“**Not once has this court affirmed a decision finding noninfringement based on the reverse doctrine of equivalents**. And with good reason: when Congress enacted 35 U.S.C. § 112, after the decision in Graver Tank, it imposed requirements for the written description, enablement, definiteness, and means-plus-function claims that are co-extensive with the broadest possible reach of the reverse doctrine of equivalents....
“Even were this court likely ever to affirm a defense to literal infringement based on the reverse doctrine of equivalents, the presence of **one anachronistic exception, long mentioned but rarely applied**, is hardly reason to create another.”
"it could never have been the intention of the legislature to punish a man, who constructed [an infringing device] merely for philosophical ex- periments, or for the purpose of ascertaining the sufficiency of the machine to produce its described effects."
“In Embrex, we followed the teachings of Roche and Pitcairn to hold that the defense was very narrow and limited to actions performed “for amusement, to satisfy idle curiosity, or for strictly philosophical inquiry.” Further, use does not qualify for the experimental use defense when it is undertaken in the “guise of scientific inquiry” but has “definite, cognizable, and not insubstantial commercial purposes.” The concurring opinion in Embrex expresses a similar view: use is disqualified from the defense if it has the “slightest commercial implication.” Moreover, use in keeping with the legitimate business of the alleged infringer does not qualify for the experimental use defense...
“Our precedent clearly does not immunize use that is in any way commercial in nature. Similarly, our precedent does not immunize any conduct that is in keeping with the alleged infringer's legitimate business, regardless of commercial implications. For example, major research universities, such as Duke, often sanction and fund research projects with arguably no commercial application whatsoever. However, these projects unmistakably further the institution's legitimate business objectives, including educating and enlightening students and faculty participating in these projects. These projects also serve, for example, to increase the status of the institution and lure lucrative research grants, students and faculty.
“In short, regardless of whether a particular institution or entity is engaged in an endeavor for commercial gain, **so long as the act is in furtherance of the alleged infringer's legitimate business and is not solely for amusement, to satisfy idle curiosity, or for strictly philosophical inquiry, the act does not qualify for the very narrow and strictly limited experimental use defense. Moreover, the profit or non-profit status of the user is not determinative**.”
Hatch-Waxman Act overturns Roche with respect to testing pharmaceutical products for regulatory approval
“the effect of a patent shall not extend to […] acts done for experimental purposes relating to the subject matter of the invention.”
construed to support a broad "experimenting on" exemption
construed to support a reasonably broad regulatory-review exemption
Clinical Trials II
however, this does not extend to testing for the purpose
of introducing a generic version at the expiration of the patent term
does not support an "experimenting with" (research tool) exemption
an activity that otherwise “would constitute an infringement of a patent for an invention shall not do so if […] it is done privately and for purposes which are not commercial.”
narrow private-use exemption
an activity that otherwise “would constitute an infringement of a patent for an invention shall not do so if […] it is done for experimental purposes relating to the subject-matter of the invention.”
construed to support a broad experiment-on exemption
no research tool exemption
(1) producers of generic replications of chemical drugs or close substitutes of biologics, as well, as perhaps, of rival innovator follow-ons,
(2) when the replications or substitutes are for drugs already approved by any EU member state,
(3) for activities involved in “conducting a study, test or trial which is necessary for and is conducted with a view to” or “required for” obtaining regulatory approval,
+ - (4) when such activities use a patented invention.
a patentee’s exclusive rights “shall not be effective against the working of the patented invention for experimental or research purposes.”
seems to support a general "experimenting on" exemption
seems not to support a general research-tool exemption
recently (1999) construed to support a regulatory-review exemption for drugs
+ - 35 USC 273(a)
A person shall be entitled to a defense under section 282(b) with respect to subject matter consisting of a process, or consisting of a machine, manufacture, or composition of matter used in a manufacturing or other commercial process, that would otherwise infringe a claimed invention being asserted against the person if—
(1) such person, acting in good faith, commercially used the subject matter in the United States, either in connection with an internal commercial use or an actual arm’s length sale or other arm’s length commercial transfer of a useful end result of such commercial use; and
(2) such commercial use occurred at least 1 year before the earlier of either—
(A) the effective filing date of the claimed invention; or
(B) the date on which the claimed invention was disclosed to the public in a manner that qualified for the exception from prior art under section 102(b).
+ - effective date: 2011/9/16
+ - defendant, who uses a process (or a product in a process) commercially in US more than 1 year prior to filing (or disclosure) by patentee, may continue to do so
Likely impact
previously, inventor of a new process, considering relying on trade-secret protection instead of patent protection, ran a risk: someone else would invent and patent the process, forcing first innovator to stop
reduction of that risk (to one-year interval) will increase marginally reliance on trade secrecy, rather than patents
“ In sum, to plead the "circumstances" of inequitable conduct with the requisite "particularity" under Rule 9(b), the pleading must identify the specific who, what, when, where, and how of the material misrepresentation or omission committed before the PTO. Moreover, although "knowledge" and "intent" may be averred generally, a pleading of inequitable conduct under Rule 9(b) must include sufficient allegations of underlying facts from which a court may reasonably infer that a specific individual (1) knew of the withheld material information or of the falsity of the material misrepresentation, and (2) withheld or misrepresented this information with a specific intent to deceive the PTO.
Except as otherwise provided by law, no recovery shall be had for any infringement committed more than six years prior to the filing of the complaint or counterclaim for infringement in the action.
1. Laches is cognizable under 35 U.S.C. § 282 (1988) as an equitable defense to a claim for patent infringement.
2. Where the defense of laches is established, the patentee’s claim for damages prior to suit may be barred.
+ - 3. Two elements underlie the defense of laches:
(a) the patentee’s delay in bringing suit was unreasonable and inexcusable, and
(b) the alleged infringer suffered material prejudice attributable to the delay. The district court should consider these factors and all of the evidence and other circumstances to determine whether equity should intercede to bar pre-filing damages.
4. A presumption of laches arises where a patentee delays bringing suit for more than six years after the date the patentee knew or should have known of the alleged infringer’s activity.
5. A presumption has the effect of shifting the burden of going forward with evidence, not the burden of persuasion.
Laches cannot be interposed as a defense against damages where the infringement occurred within the period prescribed by §286.
1. Patentee misleads defendant into reasonably inferring that patentee does not intend to enforce the patent against him or her
2. Defendant relies
3. Due to this reliance, defendant will be materially prejudiced if plaintiff is allowed to proceed
“We note, however, as we did in _Petrella_, that the doctrine of equitable estoppel provides protection against some of the problems
that [the defendat] highlights, namely, unscrupulous patentees inducing potential targets of infringement suits to invest in the production of arguably infringing products.”
Irrevocable license to use the patent in specific ways may be inferred from the patentee’s conduct, even in the absence of reliance
Principle: authorized sale of a patented
product to consumers carries with it
right to use and resell that product
Cases
patentee of amplifiers used in projectors granted license to ATC, but only to make and sell projectors to homes, not theatres
+ - ATC sold projectors in violation of that restriction
held: patentee could prevail in infringement suit against defendant purchaser, who had notice of the restriction but bought amplifiers for use in theatres
price-fixing scheme -- in which patentee on bifocals sought to set prices charged by (a) manufacturer, (b) wholesalers, and (c) retailers -- held unlawful
+ - General principle: “[T]he authorized sale of an article which is capable of use only in practicing the patent is a relinquishment of the patent monopoly with respect to the article sold. . . . Sale of a lens blank by the patentee or by his licensee is thus in itself both a complete transfer of ownership of the blank, which is within the protection of the patent law, and a license to practice the final stage of the patent procedure.”
“The reward [Univis] was demanded and received is for the article and the invention which it embodies . . . . He has thus parted with his right to assert the patent monopoly with respect to it and is no longer free to control the price at which it may be sold either in its unfinished or finished form.”
"double-dipping" rationale
Intermediate position: exhaustion applies to sales of goods overseas unless patentee forbids reimportation when products are first sold
"single use" notice on medical device
held: patentee has infringement claim against firm that refurbishes the devices in violation of the notice
Univis distinguished on the ground that this restriction did not violate antitrust laws or other public policies
+ - application to sales overseas?
+ - contract remedies still available?
+ - can downstream behavior by purchasers retroactively render initial sales "unauthorized"?
may patentee restrict licensee's freedom to _sell_ products embodying product or process patents (as opposed to restricting post-sale _uses_)?
unconditional covenant not to sue is the functional equivalent of unconditional license
+ - surprisingly expansive interpretation of "estoppel" doctrine to enlarge the set of patents covered by a prior settlement/covenant
unconditional foreign sale of a product licensed under a United States patent exhausts the patent holder's rights
repudiate Jazz Photo as inconsistent with logic of Quanta
+ - Issues left open:
May the resultant impediment to geographic price discrimination be avoided through restrictions on the licensee's right to sell?
May the impediment be avoided by dividing patent holding companies geographically?
“[A] patentee’s decision to sell a product exhausts all of its patent rights in that item, regardless of any restrictions the patentee purports to impose or the location of the sale”
Complete exhaustion triggered by authorized sale of product
e.g., AM radio
e.g., interoperability of mobile phone systems radically expands direct network effects associated with each system
+ - adherents to a standard can share benefits of indirect network effects
e.g., standardization of VCR format enabled all manufacturers to share indirect network effects of increased production of movies
Qualcomm owns ~12.5% of SEPs for 4G LTE standard; receives in licensing revenue ~3.2% of price of every 4G LTE phone sold in the world
Nokia owns an even larger share
e.g., manufacturers of steel electrical conduits combine to form a standard forbidding use of plastic conduits
e.g., noodles
+ - General guideline: If suppression of competition is the only plausible rationale for the standard, AT violation
However, if there are type #1 benefits, then standard setting is not an AT violation
Each firm must reveal patents -- or pending applications -- that might be necessary to implement the standard
failure to do so may render patents unenforceable against SSO members
license terms would not be considered anticompetitive if imposed by a dominant firm in a market without a standard
+ - "unfair" license terms include:
license fee should approximate the amount that patentee could have collected in the absence of a standard
license fees not so high as to render the industry uncompetitive
applied more strictly in EU than US
a. sensitivity to public benefits of standards through increased production and price competition
+ - b. need to avoid royalty stacking
c. principle that the license fee should be commensurate with the value the technology in question contributes to the standard and to the product
Motorola initially asked for $4B p.a.
at trial, Motorola reduced demand to $400M
Court concludes that RAND licensing would require Microsoft to pay Motorola $1.8M p.a.
+ - Motorola’s refusal to license on such terms and effort to secure an injunction (in Germany) held to be a breach of contract
Microsoft can enforce as 3rd party beneficiary
Microsoft recovers in damages $15M (for relocating EU distribution center to Netherlands and for atty fess and costs)
If patentee has committed to FRAND licensing of a SEP and a manufacturer has committed to enter into a license on reasonable terms, patentee may not seek an injunction against use of the patented technology
Motorola Mobility holds patents on technologies essential to GPRS standard (part of GSM)
Apple had agreed to take a license and to abide by determination of reasonable license fees by a German court
In 2011, Samsung initiated lawsuit against Apple, seeking injunctions in several EU countries for violation of Samsung's SEPs related to 3G UMTS standard
December 2012, EC informs Samsung that it considers the initiative an abuse of dominant position
October 2013, Samsung proposes settlement
+ - April 2014, EC accepts -- and renders binding under EU antitrust rules -- Samsung's commitments to:
12-month good-faith negotiation period
if negotiations fair, FRAND terms will be determined by a court or mutually agreed arbitrator (with ICC)
Approve all arms-length voluntary licenses
+ - Obligation on patentees to disclose royalty rates for all potential SEPs prior to adoption of the standard
+ - “Pseudo-Pool” (Contreras)
“ In a patent pool, multiple patent owners allow a common agent (sometimes one of the patent holders and sometimes a third-party administrator) to grant licenses to patents contributed to the pool, and net revenues are allocated among the pool participants in accordance with a pre-determined formula.”
+ - “In broad terms, the pseudo-pool approach incorporates the following components:”
+ - Commitments, made outside the context of SSOs, to use (or refrain from using) patents in particular ways
"Statute of Limitation is a defense to patent infringement. The limitation period for patent infringement claims is consistent with most civil claims, which is 10 years from the date on which the action accrued, or three years from the date the claimant became aware of the damages and the identity of the infringer."
“ Although there is no statutory provision for the concept of patent exhaustion, i.e. Korean Patent Act does not explicitly provide for the patent exhaustion, the Korean court has recognized the principle of exhaustion of the patent right. Korean courts have interpreted the law that, when a patentee or a licensee who has been granted a license from the patentee transfers a patented product in Korea, for the patented product, the patent right shall be deemed to have been exhausted, and the patentee may no longer exercise its patent right against such patented product.”
“However, there have not been many cases in which patent exhaustion was at issue in Korea, so the legal principle is not yet well developed in a comprehensive manner.”
“For example, it cannot be said that the specific criteria or standard has been well established when it comes to judging whether exhaustion principle is applicable to a patent claiming an invention of a method or process.”
“In Korea, a utility model requires an examination and registration by the KIPO, similar to a patent. One can choose to file either application based on the same invention. A pending patent application during the examination period, and even within 30 days of the rejection of such application, may be converted into an application for a utility model under the Utility Model Act, Art. 10. However, once a patent is issued, the same underlying invention cannot apply for a utility model in Korea. Therefore, an issued patent that has been ruled to be invalid through an invalidity proceeding cannot be converted into a utility model under Korean law.”
A patented invention is considered not to have been practiced in Korea in the following cases:
The patented invention has not been worked for three or more consecutive years in Korea, except in the case of:
The patented invention has not been worked on a substantially commercial scale in Korea for three or more consecutive years without justifiable reasons or where the domestic demand for the patented invention has not been satisfied to an appropriate extent and under reasonable conditions.
“Prior consultation with the patentee or exclusive licensee is required before filing a compulsory license petition.”
“However, prior consultation is not required when the patented invention will be non-commercially worked for the public interest or when the working of the patented invention is necessary to remedy a practice determined to be anti-competitive by judicial or administrative proceedings.”
“Further, a compulsory license may be granted when the working of the patented invention is necessary for the export of medicine under the World Trade Organization Doha Declaration to a country that intends to import the medicine in order to treat diseases that threaten the health of most of its citizens.”
(1) A patentee may grant an exclusive license of the patent to other persons.
(2) An exclusive licensee with the exclusive license shall have the sole right to commercially or industrially execute the patented invention to the extent prescribed at the grant of the license.
(3) Except in the following cases, no exclusive licensee may transfer the exclusive license, without the consent of the patentee:
(4) No exclusive licensee may establish a pledge right over the exclusive license or grant a non-exclusive license, without the consent of the patentee.
(5) Article 99 (Transfer and Joint Ownership of Patents), (2) through (4) shall apply mutatis mutandis to exclusive licenses.
(1) The following dispositions shall take effect upon registration:
1. The transfer (excluding transfer by inheritance or other universal succession) of a patent, the expiration of a patent by relinquishment, or restrictions on the disposal of a patent;
2. The grant, transfer (excluding transfer by inheritance or other universal succession), amendment, or expiration (excluding expiration by confusion) of an exclusive license or restrictions on the disposal of an exclusive license;
3. The establishment, transfer (excluding transfer by inheritance or other universal succession), amendment, or expiration (excluding expiration by error) of a pledge right over a patent or an exclusive license or restrictions on the disposal of such pledge right.
(2) When a patent, exclusive license, or pledge right is transferred by inheritance or other universal succession as referred to in paragraph (1), a report thereon shall be filed without delay with the Commissioner of the Korean Intellectual Property Office.
A patentee shall have the exclusive right to execute his or her patented invention for business purposes: _Provided_, That the foregoing shall not apply where an exclusive license of the patent has been granted so that the exclusive licensee can have the exclusive right to execute the patented invention under Article 100 (Exclusive Licenses) (2).
+ - Article 102 (Non-Exclusive Licenses)
(1) A patentee may grant a non-exclusive license of the patent to others.
(2) A non-exclusive licensee shall have the right to commercially or industrially execute the patented invention to the extent provided for in this Act or prescribed at the grant of the license.
(3) A non-exclusive license granted under Article 107 (Adjudication on Grant of Non-Exclusive Licenses) may be transferred, only if it is transferred with the underlying business.
(4) A non-exclusive license granted under Article 138 (Trial for Grant of Non-Exclusive Licenses) of this Act, Article 32 of the Utility Model Act (Trial for Granting Non-exclusive License), or Article 123 of the Design Protection Act (Trials for Granting Non-Exclusive Licenses) shall be transferred with the relevant patent, utility model right, or design right of the non-exclusive licensee, and shall expire simultaneously with the expiration of the relevant patent, utility model right, or design right.
(5) No non-exclusive license, other than non-exclusive licenses referred to in paragraphs (3) and (4), shall be transferred without the consent of the patentee (or the consent of the patentee and the exclusive licensee, if the non-exclusive license is based on an exclusive license), unless it is transferred with the underlying business or by inheritance or other universal succession.
(6) No pledge right may be established over a non-exclusive license, other than non-exclusive licenses referred to in paragraphs (3) and (4), without the consent of the patentee (or the consent of the patentee and the exclusive licensee, if the non-exclusive license is based on an exclusive license).
(7) Article 99 (Transfer and Joint Ownership of Patents), (2) and (3) shall apply mutatis mutandis to non-exclusive licenses.
+ - Article 103 (Non-Exclusive Licenses Based on Prior Use)
A person who has created the same invention as a patent claimed in an application filed for registration of the patent without prior knowledge of the invention claimed in the patent application, or who has become aware of such patent from the person who had created it before the patent application was filed, and commercially or industrially executes, or prepares to execute, the patent within the Republic of Korea shall be granted a non-exclusive license of the patent on the invention claimed in the patent application within the scope of objectives of the invention that the person executes or prepares to execute and of the business.
+ - Article 104 (Non-Exclusive Licenses Based on Executing Prior to Registration of Petitions for Trial on Invalidity)
(1) If any of the following persons has executed, or has prepared to execute, his or her patented invention or registered utility model commercially or industrially within the Republic of Korea, without knowing that the patented invention or registered utility model is invalid, before a petition seeking a trial to invalidate the patent or the registration of the utility model is filed, the person shall be granted a non-exclusive license of the patent or the exclusive license of the patent existing as at the time the patent or the registration of the utility model was invalidated, within the scope of objectives of the invention or design that the person has executed or has prepared to execute and of the business:
1. The original patentee of the invalidated patent, where one of at least two patents on the identical invention is invalidated;
2. The original owner of a registered but invalidated utility model, where the registered utility model is invalidated because it is identical to a patented invention;
3. The original patentee of an invalidated patent, where the patent is invalidated, and another patent is granted to the legitimate right-holder of the identical invention;
4. The original owner of an invalidated utility model, where the registration of his or her utility model is invalidated and a patent is granted to the legitimate right-holder on the invention identical to the design;
5. A person who has already acquired and registered an exclusive license, a non-exclusive license, or a non-exclusive license of the exclusive license before a petition seeking a trial to invalidate the patent or utility model, which is invalidated under any provision of subparagraphs 1 through 4, is filed: Provided, That the person who has acquired a non-exclusive license under Article 118 (Effects of Registration of Non-Exclusive Licenses) (2) shall need not be registered.
(2) A person granted a non-exclusive license under paragraph (1) shall pay equitable remuneration to the patentee or exclusive licensee.
+ - Article 105 (Non-Exclusive Licenses after Expiration of Design Rights)
(1) If a design right claimed in an application filed on or before the filing date of a patent application and registered accordingly conflicts with the patent, the holder of the design right at the expiration of the term of the design right shall have a non-exclusive license of the patent within the scope of the design right or a non-exclusive license of the exclusive license that exists on the patent at the expiration of the term of the design right, within the scope of the design right.
(2) If a design right claimed in an application filed on or before the filing date of a patent application and registered accordingly conflicts with the patent, the holder of either of the following rights at the expiration of the design right shall have a non-exclusive license of the patent within the scope of the design right or a non-exclusive license of the exclusive license that exists on the patent at the expiration of the design right, within the scope of the original right:
1. An exclusive license of the design right that exists at the expiration of the term of the design right;
2. A non-exclusive license in effect over the design right or an exclusive license of the design right under Article 104 (Effects of Registration of Non-Exclusive Licenses) (1) of the Design Protection Act
(3) A non-exclusive license holder under paragraph (2) shall pay equitable remuneration to the patentee or exclusive licensee.
articles covering adjudications, transfers, etc.
unfair exercise determined according to regularly-revised “Review Guidelines on Unfair Exercise of Intellectual Property Rights” established by the Korean Fair Trade Commission (KFTC) in 2000
“KFTC guidelines state that the disclosure of patent information and prior consultation on the conditions for licensing is crucial for preventing the abuse of technology designated as a technical standard. Whether these procedures have been followed is a key factor in determining the fairness of the exercise of patent rights relating to technical standards. The guidelines also state that ill use of the standardization procedure or demanding unfair conditions after being designated as a technical standard can be deemed an unfair exercise of patent rights.”
Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court.
When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to three times the amount found or assessed. Increased damages under this paragraph shall not apply to provisional rights under section 154(d)
Except as otherwise provided by law, no recovery shall be had for any infringement committed more than six years prior to the filing of the complaint or counterclaim for infringement in the action.
In the case of claims against the United States Government for use of a patented invention, the period before bringing suit, up to six years, between the date of receipt of a written claim for compensation by the department or agency of the Government having authority to settle such claim, and the date of mailing by the Government of a notice to the claimant that his claim has been denied shall not be counted as part of the period referred to in the preceding paragraph.
Patentees, and persons making, offering for sale, or selling within the United States any patented article for or under them, or importing any patented article into the United States, may give notice to the public that the same is patented, either by fixing thereon the word "patent" or the abbreviation "pat.", together with the number of the patent, or when, from the character of the article, this can not be done, by fixing to it, or to the package wherein one or more of them is contained, a label containing a like notice. **In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter**, in which event damages may be recovered only for infringement occurring after such notice. Filing of an action for infringement shall constitute such notice.
not applicable to processes
+ - infringer escapes if she can identify a product produced by a third party, with similar price and characteristics, in eyes of consumers
+ - infringer escapes if she can show that she was ready and able to produce a noninfringing substitute, but didn't for cost reasons
+ - patentee may rebut by showing that he had stable share of multi-supplier market
+ - Patentee can recover lost profits from sale of components or supplies, provided that they function together with patented components to produce a desired result
E.g., Juicy Whip (CAFC 2004)
General definition: “the amount ‘which a person, desiring to manufacture and sell a patented article, as a business proposition, would be willing to pay as a royalty and yet be able to make and sell the patented article, in the market, at a reasonable profit.’”
+ - Applicable if patentee is unable to demonstrate compensatory damages
+ - Approach #1: Hypothetical Negotiation
+ - royalty that would have been negotiated by a willing patentee and a willing licensee on the day infringement started
factors
1. The royalties received by the patentee for the licensing of the patent in suit, proving or tending to prove an established royalty.
+ - 2. The rates paid by the licensee for the use of other patents comparable to the patent in suit.
In practice, patentee commonly introduces licenses entered into by other players in the industry (as well as the licensee) and argues that they are “comparable”
+ - 3. The nature and scope of the license
+ - 4. The licensor's established policy and marketing program to maintain his patent monopoly
+ - 5. The commercial relationship between the licensor and licensee
+ - 6. Derivative or convoyed sales
+ -
The effect of selling the patented specialty
in promoting sales of other products of the
licensee;
“ By supplying the patented racks for displaying the eyeglasses, Nyman used "the patented [invention] in promoting sales of" the nonpatented eyeglasses. Trans-World may be able to prove that Nyman's infringing use of the displays played an important part in the retail sales of Nyman's eyeglasses. Furthermore, the extent of the profits from such sales could be relevant in determining the amount of a reasonable royalty. If, for example, sales were increased because of the infringing use of the displays, that fact could affect the amount of royalties a potential licensee would be willing to pay.”
the existing value of the invention to the licensor as a generator of sales of his non-patented items; and the extent of such derivative or convoyed sales.
7. The duration of the patent and the term of the license.
8. The established profitability of the product made under the patent; its commercial success; and its current popularity.
9. The utility and advantages of the patent property over the old modes or devices, if any, that had been used for working out similar results.
+ - 10. The nature of the patented invention
11. The extent to which the infringer has made use of the invention; and any evidence probative of the value of that use.
+ - 12. The portion of the profit or of the selling price that may be customary in the particular business or in comparable businesses to allow for the use of the invention or analogous inventions.
+ - 13. The value added to the infringer's product by the invention
“The portion of the realizable profit that should be credited to the invention as distinguished from non-patented elements, the manufacturing process, business risks, or significant features or improvements added by the infringer.”
availability of acceptable noninfringing substitutes
14. The opinion testimony of qualified experts.
+ - 15. The amount that a licensor (such as the patentee) and a licensee (such as the infringer) would have agreed upon (at the time the infringement began) if both had been reasonably and voluntarily trying to reach an agreement
“ that is, the amount which a prudent licensee —who desired, as a business proposition, to obtain a license to manufacture and sell a particular article embodying the patented invention — would have been willing to pay as a royalty and yet be áble to make a reasonable profit and which amount would have been acceptable by a prudent patentee who was willing to grant a license.”
_Hanson v. Alpine Valley Ski Area_ (CAFC 1983) (“The issue of the infringer’s profit is to be determined not on the basis of a hindsight evaluation of what actually happened, but on the basis of what the parties to the hypothetical license negotiations would have considered at the time of the negotiations.”).
_Radio Steel & Mfg. Co. v. MTD Prods., Inc._ (CAFC 1986) (“The determination of a reasonable royalty ... is based not on the infringer’s profit, but on the royalty to which a willing licensor and a willing licensee would have agreed at the time the infringement began.”)
~ But see _Lucent_ (CAFC 2009)
“In Fromson v. Western Litho Plate & Supply Co., 853 F.2d 1568, 1575 (Fed. Cir. 1988), ... we observed that the hypothetical negotiation analysis “permits and often requires a court to look to events and facts that occurred thereafter and that could not have been known to or predicted by the hypothesized negotiators.”
“Consideration of evidence of usage after infringement started can, under appropriate circumstances, be helpful to the jury and the court in assessing whether a royalty is reasonable. Usage (or similar) data may provide information that the parties would frequently have estimated during the negotiation.”
“ As a final matter we would add that the trial court may award an amount of damages greater than a reasonable royalty so that the award is "adequate to compensate for the infringement." As stated in Panduit Corp. v. Stahlin Bros. Fibre Works, supra, 575 F.2d at 1158, 197 USPQ at 731: ’[T]he infringer would have nothing to lose, and everything to gain if he could count on paying only the normal, routine royalty non-infringers might have paid. As said by this court in another context, the infringer would be in a heads-I-win, tails-you-lose position.’ Such an increase, which may be stated by the trial court either as a reasonable royalty for an infringer (as in Panduit) or as an increase in the reasonable royalty determined by the court, is left to its sound discretion.”
Proposed Reforms
(1) whether the patentee in fact produces a product in the market;
(2) the contribution made by the patented technology compared to the next best alternative;
(3) the number and importance of other inputs necessary to make that technology work; and
(4) evidence of how the market has actually valued the patent, to the extent it differs from the outcome of (1), (2), and (3).
“When applying a “bottom-up” approach to estimating reasonable royalties, courts should replace the Georgia-Pacific factors (and analogous factors used outside the United States) with a smaller list of considerations, specifically:
(1) calculating the incremental value of the invention and dividing it appropriately between the parties;
(2) assessing market evidence, such as comparable licenses; and
(3) where feasible and cost-justified, using each of these first two considerations as a “check” on the accuracy of the other.”
+ - Source:
Cotter, Thomas F. and Golden, John M. and Liivak, Oskar and Love, Brian J. and Siebrasse, Norman and Suzuki, Masabumi and Taylor, David O., Chapter 1: Reasonable Royalties (September 13, 2018). Forthcoming, Patent Remedies and Complex Products: Toward a Global Consensus, Ch. 1 (Brad Biddle, Jorge L. Contreras, Brian J. Love, and Norman V. Siebrasse, eds., Cambridge University Press) ; SMU Dedman School of Law Legal Studies Research Paper No. 405; Cornell Legal Studies Research Paper No. 18-49. Available at SSRN: https://ssrn.com/abstract=3249096
+ - Approach #2: Share of Infringer’s Profit (”Analytical approach”)
TWM Mfg. Co. v. Dura Corp. (CAFC 1986) (describing this method as “subtract[ing] the infringer’s usual or acceptable net profit from its anticipated net profit realized from sales of infringing devices”)
Energy Transportation (CAFC 2012) (“ Mr. Musika further performed an entirely separate analysis of a reasonable royalty using the method set forth in TWM Mfg. Co. (Fed.Cir.1986). This analysis compared the average expected profit margin on the infringing products, as set forth in Defendants' expert reports, to the industry average expected profit margin. Mr. Musika testified this analysis showed the infringing products garnered a 6.4% increase in expected profit margin based on the technology in the ETG Patents. Mr. Musika's suggested reasonable royalty rates were thus tied to the benefit accorded by the patents at issue.”)
After filing but before issuance, the applicant cannot prevent competitors from engaging in activities that, after issuance, would constitute infringement, but...
If the patent is granted, patentee can recover “reasonable royalty" for period between publication of the application and grant of the patent
+ - requirements
invention as claimed in final grant is "substantially identical" to invention as claimed in published application
infringer had "actual notice" of published application
+ - Statutory basis = Articles 128 (incl. 128-2), 131 (drawing on 130)
(1) A patentee or exclusive licensee may claim compensation for a loss inflicted by a person who has intentionally or negligently infringed the patent or exclusive license.
(2) Where a compensation for a loss is claimed pursuant to paragraph (1), but the infringer has assigned the infringing products to third parties, the amount of loss that the patentee or exclusive licensee has sustained may be calculated by multiplying the quantity of products so assigned by the profit per unit of the products that the patentee or the exclusive licensee could have assigned, but for the infringement.
(3) The amount of loss referred to in paragraph (2) shall not exceed the amount calculated by multiplying the quantity of products that the patentee or exclusive licensee could have manufactured, less the quantity of products actually assigned, by the profit per unit: Provided, That the quantity of products that the patentee or exclusive licensee could not assign due to any cause or event other than the infringement shall be subtracted therefrom, if such cause or event, in addition to the infringement, prevented the patentee or exclusive licensee from assigning the products.
(4) Where a compensation for a loss is claimed pursuant to paragraph (1), the profits that a person who has intentionally or negligently infringed the patent or exclusive license has gained due to the infringement, if any, shall be deemed the loss that the patentee or exclusive licensee has sustained.
(5) Where a compensation for a loss is claimed pursuant to paragraph (1), the patentee or exclusive licensee may claim the amount that he/she would usually be entitled to receive for practicing the patented invention as the loss that he/she has sustained.
(6) Notwithstanding paragraph (5), the amount of loss exceeding the amount specified in the same paragraph may also be claimed as damages. In such cases, the court may consider the fact that there was no intentional conduct or gross negligence on the part of the person who infringed the patent or exclusive license in determining the damages.
(7) If the court finds, in legal proceedings on infringement of a patent or exclusive license, that a loss has been incurred due to the infringement but it is extremely impracticable to verify the facts necessary for evidencing the loss in light of the nature of relevant facts, it may award reasonable damages based on the gist of entire arguments and the results of examination of evidence, notwithstanding paragraphs (2) through (6).
Where the court orders an appraisal in legal proceedings on infringement of a patent or exclusive license for the calculation of the amount of losses caused by the infringement, a party shall explain the matters necessary for the appraisal to an appraiser.
A person who infringes a patent or exclusive license of any third person shall be presumed negligent regarding such infringement.
Upon request of a patentee or exclusive licensee, the court may order the person who has degraded the business reputation of the patentee or exclusive licensee by intentionally or negligently infringing the patent or exclusive license to take necessary measures to reinstate the business reputation of the said patentee or exclusive licensee, in lieu of damages therefor or in addition to damages.
+ - ~ limitations on the time period for which a patent can be enforced for damages calculation purposes
Ten years before the infringement action was filed
Three years before the infringement action was filed, if the claimant fails to bring an action within three years of becoming aware of the infringement
"[W]e overrule the standard set out in Underwater Devices and hold that proof of willful infringement permitting enhanced damages requires at least a showing of _objective recklessness_.
"[T]o establish willful infringement, a patentee must show by clear and convincing evidence that the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent. The state of mind of the accused infringer is not relevant to this objective inquiry.”
Appellate review of this step is _de novo_
"If this threshold objective standard is satisfied, the patentee must also demonstrate that this objectively-defined risk (determined by the record developed in the infringement proceeding) was either known or so obvious that it should have been known to the
accused infringer"
Appellate review of this step is _substantial evidence_
"Because we abandon the affirmative duty of due care, we also reemphasize that there is no affirmative obligation to obtain opinion of counsel"
some district courts persist in allowing juries to take into account failure to get an opinion of counsel as one factor in determining willfulness
“Consistent with nearly two centuries of enhanced damages under patent law, however, such punishment should generally be reserved for egregious cases typified by willful misconduct.”
“willful, wanton, malicious, bad-faith, deliberate, consciously wrongful, flagrant, or—indeed—characteristic of a pirate.”
~ District Courts continue to submit question of “willfulness” to juries; instructions vary
Juries are finding willfulness more often than before Halo
Judges are exercising their discretion to enhance damages in roughly half of the cases in which juries find wilfulness
conclusory opinions have no value
submission of opinion of "opinion counsel" results in waiver of attorney-client privilege work-product protection for "all communications on the same subject matter, as well as any documents memorializing attorney-client communications"
+ - ~ 35 USC 285
i.e., “there has been some material inappropriate conduct related to the matter in litigation, such as willful infringement, fraud or inequitable conduct in procuring the patent, misconduct during litigation, vexatious or unjustified litigation, conduct that violates Fed. R. Civ. P. 11, or like infractions.”
+ - litigation is objectively baseless only if it is “so unreasonable that no reasonable litigant could believe it would succeed”
+ - ~ _Octane Fitness_ (SCOTUS 2014) enlarges the set of cases that may qualify as “exceptional”
+ - “We hold, then, that an “exceptional” case is simply one that stands out from others with respect to the substantive strength of a party’s litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated. District courts may determine whether a case is “exceptional” in the case-by-case exercise of their discretion, considering the totality of the circumstances.”
“As in the comparable context of the Copyright Act, “‘[t]here is no precise rule or formula for making these determinations,’ but instead equitable discretion should be exercised ‘in light of the considerations we have identified.’”
“Finally, we reject the Federal Circuit’s requirement that patent litigants establish their entitlement to fees under §285 by ‘clear and convincing evidence.’”
Net effect: significant increase both in requests for fee awards and in grants
increased punitive damages (up to three times the amount of compensatory damages) as remedy for infringement
Article 128 (Claim for Compensation for Loss), Sections (8) and (9) [cited above in “damages”]
[NEW of July 2019]: Article 126-2 (Obligation to Describe the Details of the Working Acts):
(1) An alleged infringer denying the specific [working] acts of infringement alleged by the patent right holder or exclusive licensee is now required to present one’s own specific [working] acts used
(2) If the alleged infringer argues that he/she has a reasonable ground for not being able to describe the details of the working acts, the court may order the alleged infringer to submit materials in order to determine whether the argument is reasonable. This does not apply if there is a reasonable ground for the alleged infringer to refuse the submission of the materials
(3) The provisions of Articles 132 paragraphs (2) and (3) shall apply mutates mutants to the previous paragraph (2). In such cases, “when it is necessary to prove the infringement or calculate the amount of damages” in Article 132, paragraph (3) shall be construed as “when it is necessary to determine whether there is a reasonable ground for not being able to describe the details of the working acts.”
(4) If, without any reasonable grounds, the alleged infringer does not describe details of the working acts, then the court will accept the patentee or licensee’s argument that the working act in question constitutes and infringing act. [CG translation]
while burden remains with Plaintiff to prove details of infringement, this new provision makes it easier to do so
statutory basis
Article 109 of the Civil Procedure Act shall apply to fees payable to patent attorneys representing a party to legal proceedings. In such cases, "attorney at law" shall be construed as "patent attorney."
(1) A fee paid or to be paid by a party to an attorney-at-law who performs a lawsuit on behalf of the party shall be admitted as the costs of lawsuit within the limit of the amounts as prescribed by the Supreme Court Regulations.
(2) When calculating the costs of lawsuit under paragraph (1), even if more than one attorneys-at-law have performed the lawsuit on behalf of the party, it shall be deemed to be representation of one attorney-at-law.
statutory basis = Chapter XII, Article 225 (Infringements)
(1) Any person who infringes a patent or an exclusive license shall be punished by imprisonment with labor for not more than seven years or by a fine not exceeding 100 million won.
(2) No person shall be prosecuted for committing a crime under paragraph (1) without a criminal complaint filed by the injured party.
“generally, bringing a patent infringement action will raise anti-trust concerns if the claimant is found to have known when filing the suit that the patent was clearly invalid or not infringed”
The several courts having jurisdiction of cases under this title [35 USCS §§ 1 et seq.] may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.
Abstract: A method and apparatus for creating a computerized market for used and collectible goods by use of a plurality of low cost posting terminals and a market maker computer in a legal framework that establishes a bailee relationship and consignment contract with a purchaser of a good at the market maker computer that allows the purchaser to change the price of the good once the purchaser has purchased the good thereby to allow the purchaser to speculate on the price of collectibles in an electronic market for used goods while assuring the safe and trusted physical possession of a good with a vetted bailee.
exercise of discretion should take into account that injunctions traditionally had issued in vast majority of successful patent suits
"In addition injunctive relief may have different consequences for the burgeoning number of patents over business methods, which were not of much economic and legal significance in earlier times. The potential vagueness and suspect validity of some of these patents may affect the calculus under the four-factor test."
finding of validity and infringement does not create presumption of irreparable harm
but irreparable harm is established where D is a competitor, corroded P's market, and is financially unstable
In 2012, CAFC holds (on appeals from two different rulings by Judge Koh) that injury to reputation as an innovator, permanent lost market share, and and permanent lost customers are insufficient to establish irreparable injury; patentee must also show causal nexus between defendant’s infringing conduct and the injuries
~ In Apple IV (2015), CAFC softens the requirement
“When a patentee alleges it suffered **irreparable harm** stemming from lost sales solely due to a competitor’s infringement, **<u>a finding that the competitor’s infringing features drive consumer demand for its products satisfies the causal nexus inquiry</u>**. In that case, the entirety of the patentee’s alleged harm weighs in favor of injunctive relief. Such a showing may, however, be nearly impossible from an evidentiary standpoint when the accused devices have thousands of features, and thus thousands of other potential causes that must be ruled out. Nor does the causal nexus requirement demand such a showing. Instead, it is a flexible analysis, as befits the discretionary nature of the four-factor test for injunctive relief. We have explained that **<u>proving a causal nexus requires the patentee to show “some connection” between the patented features and the demand for the infringing products</u>**. Apple III, 735 F.3d at 1364. Thus, in a case involving phones with hundreds of thousands of available features, it was legal error for the district court to effectively require Apple to prove that the infringement was the sole cause of the lost downstream sales. The district court should have determined whether the record established that a smartphone feature impacts customers’ purchasing decisions. ... Though the fact that the infringing features are not the only cause of the lost sales may well lessen the weight of any alleged irreparable harm, it does not eliminate it entirely.”
On remand, District Court finally grants permanent injunction against sales of Galaxy S3 -- largely moot
“[I]t has been clear since at least *Apple III* that a standard of the less demanding variety—as an interpretation of “drive demand,” a standard based on “*a* driver” as opposed to “*the* driver,” applied in the multi-consumer, multi-feature context—is the governing one for what suffices to meet the causation component of the requirement of irreparable injury, *i.e.*, that the injury asserted to be irreparable be injury *from the defendant’s use of infringing features*.”
“The clarified standards set forth in *Apple III* and *Apple IV* govern the causal-nexus inquiry, at least in a multi-purchaser, multi-component situation in which only a component of a larger product or system is covered by the patent in suit. The formulations in those decisions avoid a too-demanding causal-nexus requirement that might be attributed to the “drive demand” language. The standard prescribed by *Apple III* and *Apple IV*, as appropriate to the multi-purchaser, multi-component context, lies between the unduly stringent “sole reason” standard we rejected in *Apple III* and *Apple IV* and the unduly lax “insubstantial connection” standard we rejected in *Apple II*. The standards seek to reflect “general tort principles of causation,” ... and to make proof of causal nexus practical “from an evidentiary standpoint,” ... in a multi- purchaser, multi-component setting.”
“Where the patentee relies on lost sales to show irreparable injury, it matters what reasons various buyers have for making the purchases lost to the patentee. If all but an insignificant number of purchases from the infringer would have been made even without the infringing feature, the causal connection to the asserted lost-sale-based injury is missing. But this court’s cases have now made clear that, <u>under the causation approach suitable for a multi-feature, multi-purchaser context, the patentee may be able to make the causal connection between infringement and the relevant lost sales through evidence of various kinds, *e.g.*, that the infringing features significantly increased the product’s desirability, that soundly supports an inference of causation of a significant number of purchasers’ decisions.”</u>
trolls are disfavored
but universities and small inventors who license, rather than practice are not penalized
*this dovetails with the circumstances governing the advisability of licensing, from a business standpoint -- see IPStrategy
but cf. Amgen v. Roche, finding that the public interest points toward preserving robust incentives for pharmaceutical research
CAFC takes the position that, after eBay, the standard for a preliminary injunction is the same as the standard for a permanent injunction, with the additional requirement that patentee prove likelihood of success on the merits
+ - Net impact
Article 3(1): Member States shall provide for the measures, procedures and remedies necessary to ensure the enforcement of the intellectual property rights covered by this Directive. Those measures, procedures and remedies shall be fair and equitable and shall not be unnecessarily complicated or costly, or entail unreasonable time-limits or unwarranted delays.
Article 3(2): Those measures, procedures and remedies shall also be effective, proportionate and dissuasive and shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse.
(1) A patentee or an exclusive licensee may file a complaint to seek injunction against, or prevention of, infringement against a person who infringes, or is likely to infringe, his/her rights.
(2) When a patentee or an exclusive licensee files a complaint under paragraph (1), he/she may demand the destruction of the means by which the infringement has been committed (including the products obtained by infringement if the relevant invention is a process for manufacturing the products), the removal of the facilities used for infringement, and other measures necessary to prevent infringement.
about 20% in Seoul Central District Court
if patent in question has been invalidated, then bad faith or negligence on part of Plaintiff presumed
in cases with complex disputes; must be initiated with relevant authorities; one district prosecutor has recently retained technical staff to begin prosecuting patent infringements more actively
statutory basis = Chapter XII, Article 225 (Infringements)
(1) Any person who infringes a patent or an exclusive license shall be punished by imprisonment with labor for not more than seven years or by a fine not exceeding 100 million won.
(2) No person shall be prosecuted for committing a crime under paragraph (1) without a criminal complaint filed by the injured party.
“generally, bringing a patent infringement action will raise anti-trust concerns if the claimant is found to have known when filing the suit that the patent was clearly invalid or not infringed”
infringement cases are handled at first instance by the five district courts with exclusive jurisdiction (Seoul Central, Daejeon, Daegu, Busan and Gwangju)
statutory definition for conduct deemed infringement = Article 127 (Conduct Deemed Infringement)
Conducting either of the following activities for business purposes shall be deemed infringement of a patent or an exclusive license:
(1) If the patent is for the invention of a thing: Manufacturing, selling, leasing, or importing the thing used exclusively for manufacturing the thing or offering to sell or lease the thing;
(2) If the patent is for the invention of a process: Manufacturing, selling, leasing, or importing a thing used exclusively for executing the process or offering to sell or lease the thing.
invalidation cases are initially handled by the Intellectual Property Trial and Appeal Board (IPTAB) within the Korean Intellectual Property Office (KIPO)
IPTAB invalidation decisions and most district court infringement decisions (other than preliminary injunction orders) can both be appealed to the Patent Court
Supreme Court has access to same set of IP specialist research judges and KIPO patent examiners as does Patent Court
+ - Available to putative infringer if he can demonstrate that "the facts alleged, under all the circumstances, show that there is a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment.”
not necessary to show that the putative infringer has a reasonable apprehension that the patentee will file suit
+ - it helps (though may not be essential) for putative infringer to show that he has made meaningful preparation toward potential infringing activities
"We conclude that although _Medlmmune_ articulated a “more lenient legal standard” for the availability of declaratory judgment relief in patent cases, _Micron Tech.,_ 518 F.3d at 902-03, the issue of whether there has been meaningful preparation to conduct potentially infringing activity remains an important element in the totality of circumstances which must be considered in determining whether a declaratory judgment is appropriate. _See Teva Pharms.,_ 482 F.3d at 1339 _(Medlmmune_ requires that a court look at “all the circumstances” to determine whether a justiciable Article III controversy exists.). If a declaratory judgment plaintiff has not taken significant, concrete steps to conduct infringing activity, the dispute is neither “immediate” nor “real” and the requirements for justiciability have not been met. _See Lang v. Pac. Marine & Supply Co.,_ 895 F.2d 761, 764 (Fed.Cir.1990) (emphasizing that the test for justiciability “looks to the accused infringer’s conduct and ensures that the controversy is sufficiently real and substantial”).”
A declaratory judgment suit may be initiated with or without a co-pending infringement action before a district court for damages or injunction.
An action for declaratory judgment of infringement may be brought before the IPTAB by a patentee or an exclusive licensee.
On the other hand, an accused infringer can bring an action before the IPTAB for declaratory judgment of non-infringement without having to wait for the patentee to bring an infringement action.
Requirement for declaratory judgment
complainant for non-infringement could simply show:
That party does not need to have engaged in activity that could constitute infringement or have made meaningful preparations to engage in such activity
an actual controversy between the parties at the time the action is initiated is not required
plaintiff must specify:
the alleged infringing product or process to an extent that can be compared to the claims of the subject patent AND
show the defendant has a plan to exploit it
assuming the conditions for bringing an action are met, plaintiff may seek a declaratory judgment of non-infringement, invalidity or unenforceability or a combination of the above
“Standard Development Organization” (SDO) usually refers to a consortium of companies producing products in a particular industry
To produce or sell a product or service conforming to the standard, one must either secure a license to the patent or infringe
+ - The set of patents that companies identify as SEPs is larger than the set of true SEPs
e.g., AM radio
e.g., interoperability of mobile phone systems radically expands direct network effects associated with each system
adherents to a standard can share benefits of indirect network effects
standardization of VCR format enables all manufacturers to share indirect network effects of increased production of movies
+ - Qualcomm owns ~12.5% of SEPs for 4G LTE standard; receives in licensing revenue ~3.2% of price of every 4G LTE phone sold in the world
Nokia owns an even larger share
e.g., manufacturers of steel electrical conduits combine to form a standard forbidding use of plastic conduits
e.g., noodles
+ - problematic from standpoint of social welfare
+ - Some economists argue that, in competitive industries governed by properly structured SSOs, this will not occur
“ The key fnding is that Standard Setting Organizations (SSOs) choose efficient technology standards because voting power and market power have counterbalancing effects.”
+ - General guideline: If suppression of competition is the only plausible rationale for the standard, AT violation
However, if there are type #1 benefits, then standard setting is not an AT violation
Each firm must reveal patents -- or pending applications -- that might be necessary to implement the standard
failure to do so may render patents unenforceable against SDO members
license terms would not be considered anticompetitive if imposed by a dominant firm in a market without a standard
"unfair" license terms include:
license fee should approximate the amount that patentee could have collected in the absence of a standard
license fees not so high as to render the industry uncompetitive
applied more strictly in EU than US
a. sensitivity to public benefits of standards through increased production and price competition
+ - b. need to avoid royalty stacking
c. principle that the license fee should be commensurate with the value the technology in question contributes to the standard and to the product
Motorola asked for $4B p.a.
at trial, Motorola reduced demand to $400M
Court concludes that RAND licensing would require Microsoft to pay Motorola $1.8M p.a.
+ - Motorola’s refusal to license on such terms and effort to secure an injunction (in Germany) held to be a breach of contract
Microsoft can enforce as 3rd party beneficiary
Microsoft recovers in damages $15M (for relocating EU distribution center to Netherlands and for atty fess and costs)
Most courts and antitrust authorities take the position that the holder of an SEP subject to FRAND commitments may not obtain an injunction
If patentee has committed to FRAND licensing of a SEP and a manufacturer has committed to enter into a license on reasonable terms, patentee may not seek an injunction against use of the patented technology
Motorola Mobility holds patents on technologies essential to GPRS standard (part of GSM)
Apple had agreed to take a license and to abide by determination of reasonable license fees by a German court
In 2011, Samsung initiated lawsuit against Apple, seeking injunctions in several EU countries for violation of Samsung's SEPs related to 3G UMTS standard
December 2012, EC informs Samsung that it considers the initiative an abuse of dominant position
October 2013, Samsung proposes settlement
April 2014, EC accepts -- and renders binding under EU antitrust rules -- Samsung's commitments to:
12-month good-faith negotiation period
if negotiations fair, FRAND terms will be determined by a court or mutually agreed arbitrator (with ICC)
No consensus yet on whether patentee may seek an injunction in the absence of a FRAND commitment