The SoCal IP Law Blog
Our weekly SoCal IP Institute meeting on Monday, May 20, 2013 will be a discussion of one Federal Circuit case regarding subject matter jurisdiction and a 9th Circuit case regarding copyrights. Brief synopses of the cases appear below.
Forrester Environmental v. Wheelabrator Technologies, Case No. 12-1686 (Fed. Cir. May 16, 2013) (available here).
The Federal Circuit vacated and remanded defendant’s summary judgment motion regarding plaintiff’s state law business tort claims. The Federal Circuit held that the district court lacked subject matter jurisdiction over plaintiffs’ claims because: 1) defendant’s allegedly inaccurate statements regarding its patent rights concerned conduct taking place entirely in Taiwan; 2) the use of a patented process outside the United States is not an act of patent infringement; and thus, 3) there is no prospect of a future U.S. infringement suit arising out of the Taiwan company’s use of the parties’ products in Taiwan, and accordingly no prospect of inconsistent judgments between state and federal courts.
Righthaven LLC v. Hoehn, Case No. 11-16571 (9th Cir. May 9, 2013) (available here).
Dismissal of two copyright infringement suits is :1) affirmed in part, where agreements assigning plaintiff the bare right to sue for infringement of newspaper articles, without the transfer of any associated exclusive rights in the articles, did not confer standing to sue; and 2) vacated in part, as to the portion of the district court’s order granting summary judgment on fair use in one of the suits, because given plaintiff’s lack of standing, the district court lacked jurisdiction to rule in the alternative on the fair use defense.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, May 20, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
Our weekly SoCal IP Institute meeting on Monday, May 13, 2013 will be a discussion of Section 101 patent eligibility in the recent CLS Bank Int’l. v. Alice Corp. en banc decision. A brief synopsis of the case appears below.
CLS Bank Int’l. v. Alice Corp., Case No. 2011-1301 (Fed. Cir. May 10, 2013) (en banc) (available here).
We previously discussed CLS Bank Int’l. v. Alice Corp. here and here. The Conejo Valley Bar Association’s Amicus brief, signed by some SoCal IP Law Group attorneys, is available here.
CLS sued Alice for a declaratory judgment of noninfringement of four patents (1, 2, 3, 4) generally directed to exchanging risk of financial derivatives. The elements of each patent, expressed in various claim forms, may be automated and implemented using a computer. Alice appealed the grant of a summary judgment at the district court that certain claims of the Alice patents were invalid. A three judge Federal Circuit Panel reversed, holding the method, computer-readable media and system claims all patent eligible under 35 U.S.C. §101. CLS sought rehearing en banc, and that request was granted.
This case is a plurality decision with seven judges (of ten total) agreeing as to the invalidity of some claims, but no more than five judges agreeing as to the basis for that outcome. Specifically, a seven judge plurality of the court affirmed the district court’s decision with respect to the method and computer-readable medium claims finding that those claims recite patent-ineligible subject matter under 35 U.S.C. § 101. The decision on the system claims is split five / five, falling back to the district court’s determination of patent ineligibility even though eight judges found that method and system claims should rise and fall together. As a result of the split, the outcome is decided, but nothing in any opinion is precedent. The various opinions are the result of the en banc rehearing ordered in response to CLS’ request.
The majority opinion summarizes the current state of 101 jurisprudence as follows:
While simple enough to state, the patent-eligibility test has proven quite difficult to apply. . . . What is needed is a consistent, cohesive, and accessible approach to the § 101 analysis—a framework that will provide guidance and predictability for patent applicants and examiners, litigants, and the courts.
The majority opinion, written by Lourie and joined by Dyk, Prost, Reyna and Wallach, reviewed Supreme Court precedent and summarized the resulting case law as directing the court in several ways. First, the claim must not be abstract so that it, “subsume[s] the full scope of a fundamental concept.” If so, the court must look for “meaningful limitations that prevent the claim as a whole from covering the concept’s every practical application.” Second, the application must not be overly formalistic. If they were, the majority cautioned, subject-matter eligibility may depend only on the draftsman’s art or the skill of the individual or individuals preparing the claims. Finally, the majority indicated that the precedent urges a “flexible, claim-by-claim approach.”
The majority set forth a “systematic determination” based upon this approach. First, one must determine “whether the claimed invention fits within one of the four statutory classes set forth in § 101 and, if so, whether any of the exceptions (abstract idea, law of nature, etc.) applies. When § 101 questions arise, the court should determine what fundamental concept appears to be “wrapped up in the claim, so that the subsequent steps can proceed on a consistent footing.” The court summarized this step:
In short, one cannot meaningfully evaluate whether a claim preempts an abstract idea until the idea supposedly at risk of preemption has been unambiguously identified.
At this stage, a claim construction may be useful in determining the preempted idea. Once the idea is “nailed down,” “the balance of the claim can be evaluated to determine whether it contains additional substantive limitations that narrow, confine, or otherwise tie down the claim so that, in practical terms, it does not cover the full abstract idea itself.” These limitations may be called the “inventive concept,” but are directed more to a distinction over an abstract idea or law of nature than to their actual content as containing the invention for purposes of §§ 102 and 103. The inventive concept must be more than a trivial (“routine” or “conventional”) appendix to the otherwise abstract idea. The majority also noted that courts need not consider § 101 first and that all patents maintain a presumption of validity, including § 101 validity.
Following this procedure with respect to the Alice claims, the majority here found that none of the recited steps of the claimed process moved the claimed hedging risk for transactions between two parties using a intermediary “shadow account” to ensure that both parties have sufficient funds to complete a transaction beyond mere abstract idea. The use of the computer to do so did not add “significantly more” to this abstract idea. Specifically, the computer-implemented recitations were viewed as almost illusory, the requirement of a supervisory institution, the court found, amounted to nothing more than a traditional escrow service and, finally, the end-of-day instructions were required to cause the method to work.
The majority opinion found similarly with respect to computer-readable medium claims and system claims. In particular, the majority found that both claims should be considered effectively identical for purposes of § 101 eligibility. In addition, for the the system claims, the inclusion of “a computer,” “a data storage unit,” and “a communications controller” were irrelevant because all computers include such systems. Because two other judges agreed with the outcome of the majority, but not with the methodology, all asserted claims were found invalid under § 101.
A concurring-in-part and dissenting-in-part opinion was filed by Judges Rader, Linn, Moore and O’Malley. This opinion quibbled with the methodology arguing for a “meaningful limitation” on the method claims and to a “specific way” of doing something on a computer or a “specific computer” for doing something in system claims. Judges Linn, Moore and O’Malley would reverse the district court with regard to the system claims (thus making those claims patent eligible). Judges Rader and Moore would affirm that the method and media claims were patent ineligible.
A separate dissenting-in-part opinion by Judges Moore, Linn and O’Malley set forth their reasoning for finding the method claims patent eligible. Linn and O’Malley filed a dissent explaining that method and system claims need not rise and fall together and that the other opinions fail because they are divorced from the record of the case regarding the claims.
A separate opinion, concurring-in-part and dissenting-in-part filed by Judge Newman agreed with the majority view that the method and system claims rise and fall together, but would find that all the claims are patent eligible. Judge Newman succinctly summarized the plurality:
In deciding to rehear the patent dispute between CLS Bank and Alice Corporation, the en banc court undertook to remedy distortions flowing from inconsistent precedent on section 101. This remedial effort has failed.
Finally, Judge Rader also filed some “additional reflections” suggesting that all lawyers and judges should, perhaps consider:
When all else fails, consult the statute!
He suggests that all of this inventive discussion is far from the real issue at hand and that, generally speaking, a return to a simpler view of the statute would perhaps be the best path to follow in order to bring some clarity to these issues.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, May 13, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
Please join us for our weekly SoCal IP Institute meeting on Monday, April 29, 2013, for a presentation by Christine Kopitzke regarding ICANN’s new gTLDs. The articles listed below will provide some background for Monday’s discussion.
“Launch of new generic top level domains – the Trademark Clearinghouse offers two new services to trademark owners to protect their brands” by Latham and Watkins.
“What You Really Need to Know About ICANN’s Trademark Clearinghouse” by Doug Isenberg.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, April 29, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
Our weekly SoCal IP Institute meeting on Monday, April 22, 2013 will be a discussion of two Federal Circuit cases – one regarding patent ownership and the other regarding a patent interference.
Dawson v. Dawson and Bowman (Fed. Circ. March 25, 2013) (available here).
The Federal Circuit affirmed the BPAI’s decision in a patent interference case finding that UCSF failed to establish sole conception by Dr. Dawson, and that Dr. Dawson did not conceive of the claimed inventions by himself prior to his collaboration with Dr. Bowman.
In re Morsa (Fed. Cir. April 5, 2013) (available here).
The Federal Circuit affirmed in part and vacated and remanded in part a decision from the BPAI. Rejection by the Board of Patent Appeals and Interferences of inventor’s utility patent claims related to a benefit information match mechanism are: 1) affirmed in part, where substantial evidence supports the Board’s factual determinations, and the Board did not err in concluding that claims 181, 184, 188-203, 206, 210-25, 228, 232-47, 250, and 254-68 would have been obvious in light of the prior art; but 2) vacated and remanded in part, where the Board performed an incorrect enablement analysis when it determined that claims 271 and 272 were anticipated.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, April 22, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
Our weekly SoCal IP Institute meeting on Monday, April 15, 2013 will be a discussion of two Federal Circuit cases regarding patents. Brief synopses of the cases appear below.
Checkpoint Systems, Inc. v. All-Tag Security S.A., et. al. (Fed. Cir. March 25, 2013) (available here).
At the district court, the defendant recovered attorney fees and costs after the court held that plaintiff’s electronic anti-shoplifting devices patent was not infringed, was invalid, and was unenforceable. The Federal Circuit reversed the district court’s finding. The Federal Circuit reversed and remanded, where: 1) the infringement charge was not shown to have been made in bad faith or objectively baseless; and 2) the district court’s determination that this was an exceptional case under 35 U.S.C. section 285 is not supported by the record.
Power Integrations, Inc. v. Fairchild Semiconductor International, Inc. (Fed. Cir. March 26, 2013) (available here).
Plaintiff owned patents related to power supplies for electronic devices. The district court held that defendants willfully infringed plaintiff’s patents and awarded damages to the defendant. The Federal Circuit: 1) affirmed the district court’s finding of non-obviousness; 2) affirmed in part and reversed in part the district court’s findings on claim construction; 3) vacated as to the district court’s order of remittitur and its attendant damages award; 4) reversed on the district court’s exclusion of evidence related to pre-notice price erosion and in its refusal to grant plaintiff a post-verdict accounting; and 5) vacated and remanded as to the district court’s finding of willful infringement.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, April 15, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
Our weekly SoCal IP Institute meeting on Monday, April 8, 2013 will be a discussion of one Federal Circuit case regarding design patents and a TTAB concurrent use proceeding decision. Brief synopses of the cases appear below.
In re Owens, Case No. 2010-1426 (Fed. Cir. March 26, 2013) (available here).
The Federal Circuit affirmed the BPAI’s rejection of design patent Application No. 29/253,172 for failure to comply with 35 U.S.C. § 112, ¶ 1. The ’172 application was a continuation of a prior patented bottle, U.S. Design Pat. No. D531,515. The Federal Circuit affirmed the BPAI’s rejection, where: 1) the Board’s finding that nothing in the parent application’s disclosure suggested anything uniquely patentable about the top portion of the bottle’s front panel is supported by substantial evidence because the parent disclosure does not distinguish the now-claimed top trapezoidal portion of the panel from the rest of the pentagon in any way; and 2) unclaimed boundary lines typically should satisfy the written description requirement only if they make explicit a boundary that already exists, but was unclaimed, in the original disclosure.
America’s Best Franchising, Inc. v. Roger Abbott (TTAB March 20, 2013) (available here).
In this concurrent use proceeding, the Board awarded the applicant America’s Best Franchising (ABF) concurrent use registrations for three marks in the entire United States except for the state of Arizona. Applicant ABF is the junior user and ABF conceded that Abbott uses his mark in the state of Arizona. The Board held that even though Abbott was the first user, his “inaction over a considerable period of time, abandoned [his] right to expand use of the mark… outside of the trading area, and that by virtue of such abandonment, [Abbott's] prior use of the mark cannot serve to preclude [ABF], a[n] innocent user.”
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, April 8, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
Our weekly SoCal IP Institute meeting on Monday, April 1, 2013 will be a discussion of one Federal Circuit case regarding patent divided infringement and a 9th Circuit case regarding copyright fair use. Brief synopses of the cases appear below.
Columbia Pictures et al. v. Gary Fung; Isohunt Web Tech., Inc., Case No. 10-55946 (9th Cir. March 21, 2013) (available here).
The 9th Circuit affirmed in part and vacated in part the district court’s judgment in favor of film studios, which alleged that the services offered and websites maintained by the defendants induced third parties to download infringing copies of the studios’ copyrighted works. The panel held that under Metro-Goldwyn-Mayer Studios, Inc. v. Grokster Ltd., 545 U.S. 913 (2005), the defendants were liable for contributory copyright infringement on an inducement theory because the plaintiffs established (1) distribution of a device or product, (2) acts of infringement, (3) an object of promoting the product’s use to infringe copyright, and (4) causation in the defendants’ use of the peer-to-peer file sharing protocol known as BitTorrent.
The panel also held that the defendants were not entitled to protection from liability under any of the safe harbor provisions of the Digital Millennium Copyright Act, including safe harbors provided by 17 U.S.C. § 512(a), (c), and (d) for transitory digital network communications, information residing on systems or networks at direction of users, and information location tools. The panel nonetheless rejected the argument that inducement liability is inherently incompatible with protection under the safe harbors. Finally, the panel held that certain provisions of the injunction were too vague to meet the notice requirements of Fed. R. Civ. P. 65(d), and certain provisions were unduly burdensome.
Abbot Labs. v. Cordis Corp., Case No. 2012-1244 (Fed. Cir. March 11, 2013) (available here).
Cordis Corporation appealed from the decision of the United States District Court for the Eastern District of Virginia granting Abbott Laboratories’ motion to quash two subpoenas duces tecum issued pursuant to 35 U.S.C. § 24. The district court concluded that section 24 only empowers a district court to issue a subpoena for use in a “contested case,” and that contested cases are limited to those in which the regulations of the United States Patent and Trademark Office (“PTO”) authorize the parties to take depositions. Since the PTO does not provide for depositions in inter partes reexamination proceedings, such proceedings are not “contested cases” within the meaning of section 24, and subpoenas under section 24 are not available. The Federal Circuit affirmed.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, April 1, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
We were lucky enough to have Young-Wook Ha , the President of Korean intellectual property firm firm Ha & Ha, visiting with us last week. Mr. Ha provided some guidance on the differences between Korean and U.S. patent practice and recent changes to Korean practice. As a result of Mr. Ha’s visit, we did not cover those cases that we had intended to cover. We will now cover those cases on Monday, March 25, 2013 in our weekly SoCal IP Institute meeting.
We will discuss one Federal Circuit case regarding patent divided infringement and one 9th Circuit case regarding copyright fair use that were first outlined last week. Brief synopses of the cases appear below.
Aristocrat Technologies Australia PTY Ltd. et al. v. IGT, Case No. 2010-1426 (Fed. Cir. March 13, 2013) (available here).
This is a gambling-related patent suit stemming from a method of offering a patron a reward from a secondary game after a patron has taken part in a first game. One of the steps of the process is “making a wager at a particular gaming machine in the network of gaming machines,” which the district court construed as requiring the patron to place a bet. As a result, the district court granted IGT’s motion for summary judgment because all claims require two separate actors, the operator of the gaming machine and the player. Aristocrat appealed the claim construction and the divided infringement decision.
On appeal, the Federal Circuit agreed with the district court’s construction of the “making a wager” limitation. Next, they indicated that no single actor performs all of the required step and, therefore, there can be no direct infringement. However, the Federal Circuit remanded the case for a determination whether here was indirect infringement of the patent under the recent Akamai decision. The case was, therefore, affirmed in part, vacated and remanded in part.
SOFA Entertainment, Inc. v. Dodger Prod., Inc. Etc. D.C. No. 2:08-cv-02616 (9th Cir. March 11,, 2013) (available here).
This 9th Circuit decision affirmed the district court’s grant of summary judgment and award of attorneys’ fees in a copyright infringement suit regarding a seven-second clip of Ed Sullivan’s introduction of the Four Seasons on The Ed Sullivan Show. The panel held that the defendants were entitled to prevail on their fair use defense as a matter of law.
The defendants used the clip in Jersey Boys, a musical about the Four Seasons, to mark a historical point in the band’s career. The panel held that this was a fair use because by using the clip for its historical significance, the defendants had imbued it with new meaning and had done so without usurping whatever demand there was for the original clip.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, March 18, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Smith by 9 am Monday morning.
Our weekly SoCal IP Institute meeting on Monday, March 18, 2013 will be a discussion of one Federal Circuit case regarding patent divided infringement and a 9th Circuit case regarding copyright fair use. Brief synopses of the cases appear below.
Aristocrat Technologies Australia PTY Ltd. et al. v. IGT, Case No. 2010-1426 (Fed. Circ. March 13, 2013) (available here).
This is a gambling-related patent suit stemming from a method of offering a patron a reward from a secondary game after a patron has taken part in a first game. One of the steps of the process is “making a wager at a particular gaming machine in the network of gaming machines,” which the district court construed as requiring the patron to place a bet. As a result, the district court granted IGT’s motion for summary judgment because all claims require two separate actors, the operator of the gaming machine and the player. Aristocrat appealed the claim construction and the divided infringement decision.
On appeal, the Federal Circuit agreed with the district court’s construction of the “making a wager” limitation. Next, they indicated that no single actor performs all of the required step and, therefore, there can be no direct infringement. However, the Federal Circuit remanded the case for a determination whether here was indirect infringement of the patent under the recent Akamai decision. The case was, therefore, affirmed in part, vacated and remanded in part.
SOFA Entertainment, Inc. v. Dodger Prod., Inc. Etc. D.C. No. 2:08-cv-02616 (9th Cir. March 11,, 2013) (available here).
This 9th Circuit decision affirmed the district court’s grant of summary judgment and award of attorneys’ fees in a copyright infringement suit regarding a seven-second clip of Ed Sullivan’s introduction of the Four Seasons on The Ed Sullivan Show. The panel held that the defendants were entitled to prevail on their fair use defense as a matter of law.
The defendants used the clip in Jersey Boys, a musical about the Four Seasons, to mark a historical point in the band’s career. The panel held that this was a fair use because by using the clip for its historical significance, the defendants had imbued it with new meaning and had done so without usurping whatever demand there was for the original clip.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, March 18, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Attalla by 9 am Monday morning.
Our weekly SoCal IP Institute meeting on Monday, March 11, 2013 will be a discussion of two patent cases from the Federal Circuit. Brief synopses of the cases appear below.
Radio Systems Corp v. Lalor, Case No. 2012-1233 (Fed. Cir. March 6, 2013) (available here).
The Federal Circuit affirmed in part the district court’s decision that the plaintiffs did not infringe two of defendant’s patents. The patents were on improvements to electronic animal collars. The court held that district court decision is: 1) affirmed in part as to the judgment of non-infringement for GS-011, FieldPro, and SD-1825 collars, where the district court correctly construed the claim terms “electrode base” and “inside surface,” and correctly applied its constructions to these accused collars, 2) affirmed in part, where the district court did not abuse its discretion in concluding that equitable estoppel applied to defendant’s ’014 patent infringement allegations on the UltraSmart collar against both plaintiff Innotek and its successor-in-interest, plaintiff Radio Systems; but 3) reversed in part and remanded, as to the ’082 patent, where the district court abused its discretion by granting summary judgment of non-infringement for the UltraSmart collar on the basis of equitable estoppel.
Move, Inc. v. Real Estate Alliance Ltd., Case No. 12-1342 (Fed. Cir. March 4, 2013) (available here).
Summary judgment that plaintiff did not infringe claim 1 of defendant’s ’989 patent related to methods for locating available real estate properties using a zoom-enabled map on a computer, is vacated and remanded for a determination whether plaintiff is liable for indirect infringement, where the district court: 1) did not err by finding no genuine issue of material fact that plaintiff is not liable for direct infringement of claim 1 of the ’989 patent; but, 2) legally erred by not analyzing inducement under 35 U.S.C. 271(b); and 3) failed to conduct an indirect infringement analysis and did not determine whether a genuine issue of material fact existed as to the performance of all the claim steps, whether by one entity or several.
All are invited to join us in our discussion during the SoCal IP Institute meeting on Monday, March 11, 2013 at Noon in our Westlake Village office. This activity is approved for 1 hour of MCLE credit. If you will be joining us, please RSVP to Noelle Attalla by 9 am Monday morning.
