Archive for July, 2018

Judge O’Malley and the Chenery Doctrine

Tuesday, July 31st, 2018

Judge O’Malley penned a dissent last week while sitting by designation with the 9th Circuit.  The dissent might be of interest to some as it concerns agency action and the Chenery Doctrine.

You can read her dissent in ALTERA CORPORATION & SUBSIDIARIES v. COMMISSIONER OF INTERNAL REVENUE, No. 16-70496 (9th Cir. July 24, 2018) [here].

You can watch the video of the oral argument [here].

Oral argument of the week: Philips Lighting N.A. v. Wangs Alliance Corp.

Monday, July 30th, 2018

The oral argument of the week is from PHILIPS LIGHTING NORTH AMERICA v. WANGS ALLIANCE CORPORATION, No. 2017-1526 (Fed. Cir. Apr. 18, 2018).  The oral argument is interesting for its discussion of “design choice” as well as other issues concerning motivation to combine references in an obviousness argument.

You can listen to the oral argument below:

You can read the court’s opinion [here].

The pertinent portion of the opinion reads:

Philips complains that the Board did not identify the specific “affirmative reason” for a person of skill looking at Hochstein to adopt the alternative configuration in Hildebrand. But in the circumstances of this case, we conclude, Philips is demanding too much. Under KSR, we see no need for more than what the Board found in this case, including that (1) there were just two obvious design choices in the respect put at issue (Hochstein and Hildebrand), which solve the same problem in the same way but with the filter and current-conducting network swapped in their locations, (2) the two references “show the demand for designs that solve the known problem,” id. at 33; (3) Hildebrand’s location choice was a common and approved design that could be used in Hochstein; and (4) Hochstein would not malfunction if modified to use such a design. These findings suffice to establish a reason for a skilled artisan, seeking to solve the status-test problem, to use a three-component circuit arrangement as found in both references and to choose either of the two disclosed orders of the first two components within that arrangement—specifically, the order that is especially common in the art and that is used in the ‘988 patent. See KSR, 550 U.S. at 416 (combining “familiar elements according to known methods is likely to be obvious when it does no more than yield predictable results”).

PHILIPS LIGHTING NORTH AMERICA v. WANGS ALLIANCE CORPORATION, No. 2017-1526 (Fed. Cir. Apr. 18, 2018).

During the oral argument, the appellant repeatedly referenced three cases: Metalcraft v. Toro, ActiveVideo v. Verizon, and Innogenetics v. Abbott.  Since the court’s opinion does not mention those cases, I thought it might be helpful to reproduce them below for your reference as you listen to the oral argument.

 

The district court rejected Toro’s motivation to combine argument. It recognized that “a patent `composed of several elements is not proved obvious merely by demonstrating that each of its elements was, independently, known in the prior art'” and that “it can be important to identify a reason that would have prompted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does.” J.A. 13-14 (quoting KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 418-19, 127 S.Ct. 1727, 167 L.Ed.2d 705 (2007)). It concluded that Toro failed to raise a substantial question of validity, stating Toro offered “no reason, and the Court cannot imagine one, that a person of ordinary skill in this field would combine a motorcycle shock with a suspended truck cab and come up with a suspended operator platform.” J.A. 13-14.

On appeal, Toro argues the district court’s analysis is inconsistent with KSR, 550 U.S. at 420-21, 127 S.Ct. 1727, which stated: “The idea that a designer hoping to make an adjustable electronic pedal would ignore Asano because Asano was designed to solve the constant ratio problem makes little sense. A person of ordinary skill is also a person of ordinary creativity, not an automaton.” Toro argues it would have been obvious to a person of skill in the art to combine Henriksson and Sasaki because Henriksson sought to solve the problem of transmission of shock loads to the operator and specified conventional and telescope-type shock absorbers as methods of reducing shock loads.

We hold that the district court’s finding that there would not have been a motivation to combine is not clearly erroneous. The district court correctly acknowledged that it is not enough for Toro to merely demonstrate that elements of the claimed invention were independently known in the prior art. Often, every element of a claimed invention can be found in the prior art. In re Kotzab, 217 F.3d 1365, 1370 (Fed. Cir. 2000). Moreover, Toro merely identifies a problem that Henriksson sought to solve. However, “knowledge of a problem and motivation to solve it are entirely different from motivation to combine particular references.” Innogenetics, N.V. v. Abbott Labs., 512 F.3d 1363, 1373 (Fed. Cir. 2008).

We agree with the district court that Toro provides no explanation or reasoning for concluding that one of skill in the art would have combined these particular references to produce the claimed invention. Without any explanation as to how or why the references would be combined to arrive at the claimed invention, we are left with only hindsight bias that KSR warns against. See KSR, 550 U.S. at 421, 127 S.Ct. 1727. And while we understand that “[t]he obviousness analysis cannot be confined by a formalistic conception of the words teaching, suggestion, and motivation,” we also recognize that we cannot allow hindsight bias to be the thread that stitches together prior art patches into something that is the claimed invention. See KSR, 550 U.S. at 419, 421, 127 S.Ct. 1727. For these reasons, we conclude that the district court did not abuse its discretion in rejecting Toro’s obviousness defense and determining that Toro did not raise a substantial question of validity.

Metalcraft of Mayville, Inc. v. The Toro Co., 848 F.3d 1358, 1367 (Fed. Cir. 2017).

 

We agree with the district court that the obviousness testimony by Verizon’s expert was conclusory and factually unsupported. Although Verizon’s expert testified that “[t]hese are all components that are modular, and when I add one, it doesn’t change the way the other one works,” J.A. 4709, he never provided any factual basis for his assertions. The expert failed to explain how specific references could be combined, which combination(s) of elements in specific references would yield a predictable result, or how any specific combination would operate or read on the asserted claims. Rather, the expert’s testimony on obviousness was essentially a conclusory statement that a person of ordinary skill in the art would have known, based on the “modular” nature of the claimed components, how to combine any of a number of references to achieve the claimed inventions. This is not sufficient and is fraught with hindsight bias. See KSR, 550 U.S. at 418, 127 S.Ct. 1727 (“A patent composed of several elements is not proved obvious by merely demonstrating that each of its elements was, independently, known in the prior art.”); Innogenetics, N.V. v. Abbott Labs., 512 F.3d 1363, 1373-74 (Fed.Cir. 2008) (“Such vague testimony would not have been helpful to a lay jury in avoiding the pitfalls of hindsight that belie a determination of obviousness.”).

1328*1328 The opinion by Verizon’s expert regarding the motivation to combine references was likewise insufficient. Verizon’s expert testified that:

The motivation to combine would be because you wanted to build something better. You wanted a system that was more efficient, cheaper, or you wanted a system that had more features, makes it more attractive to your customers, because by combining these two things you could do something new that hadn’t been able to do before.

J.A. 4709-10. This testimony is generic and bears no relation to any specific combination of prior art elements. It also fails to explain why a person of ordinary skill in the art would have combined elements from specific references in the way the claimed invention does. See KSR, 550 U.S. at 418, 127 S.Ct. 1727 (“[I]t can be important to identify a reason that would have prompted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does … because inventions in most, if not all, instances rely upon building blocks long since uncovered, and claimed discoveries almost of necessity will be combinations of what, in some sense, is already known.”); Innogenetics, 512 F.3d at 1373 (Fed.Cir.2008) (“[K]nowledge of a problem and motivation to solve it are entirely different from motivation to combine particular references….”). Because the record evidence was insufficient for a reasonable jury to support a determination of obviousness, the district court’s grant of ActiveVideo’s JMOL on obviousness was not erroneous.

ActiveVideo Networks v. Verizon Communications, 694 F.3d 1312, 1327-28 (Fed. Cir. 2012).

 

Dr. Patterson merely lists a number of prior art references and then concludes with the stock phrase “to one skilled in the art it would have been obvious to perform the genotyping method in [claims 1-9 & 12-13] of the ‘704 patent.”[2] “[T]here must be some articulated reasoning with some rational underpinning to support the legal conclusion of obviousness.” In re Kahn, 441 F.3d 977, 988 (Fed.Cir.2006); see also KSR Int’l Co. v. Teleflex Inc., ___ U.S. ___, 127 S.Ct. 1727, 1741, 167 L.Ed.2d 705 (2007) (“To facilitate review, this analysis should be made explicit.”) (citing Kahn, 441 F.3d at 988). Nowhere does Dr. Patterson state how or why a person ordinarily skilled in the art would have found the claims of the ‘704 patent obvious in light of some combination of those particular references. As the district court found: “It is not credible to think that a lay jury could examine the Cha application, the Resnick ‘718 patent that defendant cited as prior art or any of the other references and determine on its own whether there were differences among them and the ‘704 patent.” Innogenetics, N.V. v. Abbott Labs., No. 05-0575-C, slip op. at 14 (W.D.Wis. Jan. 3, 2007). Such vague testimony would not have been helpful to a lay jury in avoiding the pitfalls of hindsight that belie a determination of obviousness. See Graham v. John Deere Co., 383 U.S. 1, 36, 86 S.Ct. 684, 15 L.Ed.2d 545 (1966) (discussing the “importance of guarding against hindsight… and resisting] the temptation to read into the prior art the teachings of the invention in issue” when considering the obviousness of a patent).

On appeal, Abbott argues in a single sentence, without any explanation, that the district court erred in concluding that Dr. Patterson did not offer any evidence of a “motivation to combine” the various prior art references that he opined rendered the claims of the ‘704 patent obvious. To be sure, Dr. Patterson suggested that one of skill in the art was motivated to find a method capable of genotyping because at least one prior art reference had disclosed that “different genotypes of HCV respond differently to interferon therapy.” The district court was nevertheless correct that knowledge of a problem and motivation to solve it are entirely different from motivation to combine particular references to reach the particular claimed method. Innogenetics, slip op. at 14 (“A generalized motivation to develop a method is not the kind of motivation required by the patent laws.”). We cannot conclude that the district 1374*1374 court abused its discretion when it precluded Dr. Patterson’s vague and conclusory obviousness testimony which did not offer any motivation for one skilled in the art to combine the particular references he cites in order to practice the claimed method.[3]

Abbott also argues that there is no requirement that an expert opine on motivation to combine references, and that motivation can be established by other witnesses or the prior art. Abbott is correct that an expert is not the only source for evidence that it would be obvious for one skilled in the art to combine references to reach the claimed method. But, as the district court held, “some kind of motivation must be shown from some source, so that the jury can understand why a person of ordinary skill would have thought of either combining two or more references or modifying one to achieve the patented method.” Id. at 13.

Innogenetics, NV v. Abbott Laboratories, 512 F.3d 1363, 1373-74 (Fed. Cir. 2008).


Just for my own benefit for future reference, here is a related quote from Personal Web Technologies v. Apple:

The Board’s reasoning is also deficient in its finding that a relevant skilled artisan would have had a motivation to combine Woodhill and Stefik in the way claimed in the ‘310 patent claims at issue and would have had a reasonable expectation of success in doing so. The Board’s most substantial discussion of this issue merely agrees with Apple’s contention that “a person of ordinary skill in the art reading Woodhill and Stefik would have understood that the combination of Woodhill and Stefik would have allowed for the selective access features of Stefik to be used with Woodhill’s content-dependent identifiers feature.” Id. at *8 (emphasis added). But that reasoning seems to say no more than that a skilled artisan, once presented with the two references, would have understood that they could be combined. And that is not enough: it does not imply a motivation 994*994 to pick out those two references and combine them to arrive at the claimed invention. See Belden Inc. v. Berk-Tek LLC, 805 F.3d 1064, 1073 (Fed. Cir. 2015) (“[O]bviousness concerns whether a skilled artisan not only could have made but would have been motivated to make the combinations or modifications of prior art to arrive at the claimed invention.”); InTouch Techs., Inc. v. VGO Communications, Inc., 751 F.3d 1327, 1352 (Fed. Cir. 2014).

If the Board’s statement were read more broadly, it would not be adequately explained and grounded in evidence. Indeed, the Board nowhere clearly explained, or cited evidence showing, how the combination of the two references was supposed to work. At least in this case, such a clear, evidence-supported account of the contemplated workings of the combination is a prerequisite to adequately explaining and supporting a conclusion that a relevant skilled artisan would have been motivated to make the combination and reasonably expect success in doing so.

 

Personal Web Technologies, LLC v. Apple, Inc., 848 F.3d 987, 993-94 (Fed. Cir. 2017).

 

Simple, yet non-obvious

Saturday, July 28th, 2018

If the first wearable pair of eyeglasses — i.e., the handheld type that one holds on the bridge of the nose — were invented in the 13th century in Italy, when do you think “legs” were invented?  Legs are the portion that fit over the wearer’s ears.

Answer below the break:

(more…)

Angry and unfriendly

Thursday, July 26th, 2018

The Federal Circuit got a little taste of patent prosecution in deciding the recent case of In re Power Integrations.  The patent at issue had undergone ex parte reexamination, been appealed to the Board, and then appealed to the Federal Circuit.  In parallel litigation, the patent had also undergone claim construction by a district court judge.  The claim construction conducted by the Board under BRI differed from that of the district court judge who construed the claim under the Phillips standard used for patent litigation.

In the Federal Circuit’s first appeal decision, the Federal Circuit remanded the case back to the Board so that the Board could take into consideration the analysis performed by the district court judge. The court said, in part:

We do not hold that the board must in all cases assess a previous judicial interpretation of a disputed claim term. Nor do we express any view on the merits of Power Integrations’ proposed construction of the term “coupled to.” We hold only that the board on remand should carefully and fully assess whether the disputed claims of the ‘876 patent are anticipated by the prior art, setting out its reasoning in sufficient detail to permit meaningful appellate review. See Lee, 277 F.3d at 1346 (emphasizing that remand is required where a board decision “is potentially lawful but insufficiently or inappropriately explained” (citations and internal quotation marks omitted)); see also Nazomi Commc’ns, Inc. v. Arm Holdings, PLC, 403 F.3d 1364, 1371 (Fed.Cir.2005) (vacating and remanding a district court’s claim construction determination because the court did “not supply the basis for its reasoning sufficient for a meaningful review”).

Power Integrations, Inc. v. Lee, 797 F.3d 1318, 1327 (Fed. Cir. 2015).

The Board, however, declined to take into consideration the district court’s claim construction.  The Board wrote in its second opinion:

 

When the second Board opinion was appealed to the Federal Circuit, the court did not seem too pleased with the “unwarranted” language. Judge Moore, for example, commented:

 

 

It is interesting that the Solicitor’s Office did not address Judge Moore’s question of whether there is someone who reviews Board opinions after they are drafted by the Board panel members.  It has been a mystery to the patent bar how the Board operates internally. Shrouded silence only fosters rumor and speculation. It would be useful if the Federal Circuit panels would press the Solicitor’s Office for more detail during oral argument about how the Board operates internally.  Presumably, every Federal Circuit panel wants to make sure it has jurisdiction before deciding a case.  And, the Federal Circuit does not have jurisdiction to decide a case that has been decided not in accordance with the statutes and regulations governing the operation of the Board, i.e., illegally.

You can listen to the entire oral argument here:

 

You can read the court’s opinion [here].

Judge Plager’s Message to the Supreme Court on Patent Eligibility: The Emperor Has No Clothes

Wednesday, July 25th, 2018

Judge Plager penned a rather long and eloquent dissent in last week’s Federal Circuit decision of INTERVAL LICENSING LLC v. AOL, INC., No. 2016-2502 (Fed. Cir. July 20, 2018).  I have reproduced the dissent by the former Dean of the Indiana University School of Law below:

________________________________________________________________________

PLAGER, Circuit Judge, concurring-in-part and dissenting-in-part.

Today we are called upon to decide the fate of some inventor’s efforts, whether for good or ill, on the basis of criteria that provide no insight into whether the invention is good or ill. Given the current state of the law regarding what inventions are patent eligible, and in light of our governing precedents, I concur in the carefully reasoned opinion by my colleagues in the majority, even though the state of the law is such as to give little confidence that the outcome is necessarily correct. The law, as I shall explain, renders it near impossible to know with any certainty whether the invention is or is not patent eligible. Accordingly, I also respectfully dissent from our court’s continued application of this incoherent body of doctrine.

The Three Exceptions

The majority opinion, after reviewing in detail the district court’s decision and the patent’s written description and claims, goes through the obligatory review of the history of 35 U.S.C. § 101, the statutory section entitled “Inventions patentable.” Under the statute a patent may be obtained for an invention that is a “new and useful process, machine, manufacture, or composition of matter.” This phrasing is often described as providing a wide and permissive scope for patent eligibility.[1]

However, as the majority opinion notes, any recourse to § 101 must take into account not only the words of the statute but also the Supreme Court’s judicially created three exceptions to the statute’s description of what is patent eligible. Of these three Court-created exceptions— `laws of nature, natural phenomena, and abstract ideas’— the one at issue in this case is the one that causes the most trouble: `abstract ideas.’

That `abstract ideas’ is the only one of the three at issue here is a critical point, in need of emphasizing. All too often courts discussing these three judicially created exceptions to patent eligibility lump them together, as if all three present the same set of issues to be conceptualized and analyzed.[2] They do not. `Laws of nature’ and `natural phenomena’ have understandable referents, and thus have proven more amenable to workable definitions, or at least a reasonable degree of boundary-setting, and thus are more amenable to analysis.[3]

However, when it comes to applying the concept of `abstract ideas’ to a challenged patent (or application for patent) as a distinct test of patent eligibility, the issues are different, and require close examination. The analytical structure which we now are to employ is provided by the Supreme Court’s recent teachings in Alice Corp. v. CLS Bank International.[4] (Alice is often linked at citation-time to an earlier case, Mayo Collaborative Services v. Prometheus Laboratories, Inc.;[5] that case did not turn on the `abstract ideas’ formula, and is an example of the blending that can cause analytical confusion.)

I. Abstract Idea(s)

The majority opinion, following the structure dictated by Alice, first steps through “Alice Step 1: Abstract Idea.” The court recites a bit of the history of the `abstract ideas’ idea from its origins in the 19th century, and then reviews the more recent cases that wander through it, lining the cases up as they explain themselves on both sides of the divide between good and ill. (In Amdocs (Israel) Ltd. v. Openet Telecom, Inc.,[6] I explained the reason for this evolved decision-by-example technique; the verbal nature of the distinctions drawn becomes quite apparent.)

The majority opinion concludes that “the recited claims are directed to an abstract idea because they consist of generic and conventional information acquisition and organization steps that are connected to, but do not convert, the abstract idea.” Maj. Op. at 18. This often-seen language is familiar from Alice. See Alice, 134 S. Ct. at 2359-60. It is interesting language—if “generic and conventional” is the same as `previously known,’ someone familiar with traditional patent law might think of the 1952 Patent Act’s § 103 and the nonobviousness principle—a point discussed later; but, following Alice, the majority opinion, as did the district court, ignores the Patent Act’s requirements and cites the current litany for abstractness.

But what makes an idea found in a claim an `abstract idea’? An idea itself by definition is “[s]omething, such as a thought or conception, that is the product of mental activity.”[7] The definitions of “abstract” include “[c]onsidered apart from concrete existence,” “[d]ifficult to understand; abstruse,” and “[n]ot applied or practical; theoretical.”[8] An idea, whether abstract or not, is something that lives in the interstices of someone’s brain, a psychophysiological area not fully understood to this day.[9]

And ideas can have an infinite range of abstractness, if by that we imply concreteness—for example, compare “I have an idea—let’s have hamburgers for dinner,” with “I have an idea—I am going to invent how to make time go backwards.”[10] How much of abstractness is a function of concreteness? How do we pick the line where the articulation and explication of an idea is sufficiently concrete to be `non-abstract,’ but not so much as to be `generic and conventional’? Does it help to phrase the notion as the difference between claiming a desired result and claiming how to produce that same result? Or are we just substituting one set of vague notions for the other, with the same line-drawing problem?

That the phrase `abstract ideas’ is a definitional morass can be seen in one simple fact—a search for a definition of `abstract ideas’ in the cases on § 101 from the Supreme Court, as well as from this court, reveals that there is no single, succinct, usable definition anywhere available. The problem with trying to define `abstract ideas,’ and why no court has succeeded in defining it, is that, as applied to as-yet-unknown cases with as-yetunknown inventions, it cannot be done except through the use of equally abstract terms.[11] As explained in Amdocs, the closest our cases come to a definition is to state examples of what prior cases have contained, and which way they were decided. But what anecdotal cases reveal, a definition does not make.

The `abstract ideas’ idea, when used for denying a claimed invention’s patent eligibility either before or after a patent is issued, cannot thus function as a valid rule of law. As a fundamental policy, a legal term such as `abstract ideas,’ if the exclusionary standards of § 101 are to function as a valid rule of law, must provide concise guidance for the future. In that sense, a rule of law is a prediction of how courts will decide future cases.[12] `Abstract ideas,’ like the term `obscenity,’ may provide a cultural consensus in a given instance regarding whether a past event qualifies, but it fails to provide the kind of specificity and clarity that makes it useful for future prediction of outcome. And from the viewpoint of decisional law, the `abstract ideas’ idea falls short in the sense of providing a trial judge with confidence that the judgment will be understood by the judges who come after, since only the judges who have the final say in the matter can say with finality that they know it when they see it.

II. Inventive Concept

Having determined the claims at issue to be directed to nothing more than `abstract ideas,’ the majority opinion, following the Alice analysis, segues to “AliceStep 2: Inventive Concept.” Here the court explores whether the invention’s claims, determined in Step 1 to be abstract, are not really abstract because they limit the abstractness by an `inventive concept.’ In the case before us, no such concept is seen; the trial court’s determination of fatal abstraction is affirmed.

A small puzzle—if a court, after reviewing challenged claims in light of their terminology and written description, determines the claims to be `abstract’ in Step 1, how can the same court be expected to determine on a second reading that the same claims have become `un-abstract’ via Step 2? Could it be that an `inventive concept’ cannot exist until the court reads the patent at least one more time? Perhaps courts cannot be expected to read the claims carefully enough the first time?

A bigger puzzle regarding the `inventive concept’ concept: Those who are familiar with the history of the Patent Act, when in 1952 the law of patenting was given a major statutory overhaul, will be the most puzzled. Is it the case that now, some 65 years later, we really have resurrected the concept of an `inventive concept’?[13]The late Judge Giles Rich, the grand old man of patent law, whose portrait hangs in the place of honor in the Federal Circuit courthouse—how can he rest in peace? He was one of the acclaimed authors of the new Patent Act. At the time he, along with many others, thought that the undefinable—truly abstract—concept of `inventive concept’ had been put into the dustbin of history by the specific criteria for a valid patent in the new Patent Act, specifically § 103, non-obvious subject matter.

Judge Rich wrote extensively on the point. See, e.g., Giles S. Rich, Laying the Ghost of the “Invention” Requirement, 1 APLA Q.J. 26 (1972); Giles S. Rich, The Vague Concept of “Invention” as Replaced by Sec. 103 of the 1952 Patent Act, 46 J. Pat. Off. Soc’y 855 (1964).[14] In his 1964 article, based on a speech he gave twelve years after the statutory changes were enacted, Judge Rich reviewed the long and sorry history during the 19th century of the “injection into the law of what has ever since been called the `requirement for invention.'” 46 J. Pat. Off. Soc’y at 860. “This proliferation of views on what did and did not amount to `invention’ went on for 100 years. We were enlightened with the view that `invention’ resulted from the exercise of the `inventive faculties’ and other circular reasoning.” Id. He attributed this development to an 1851 Supreme Court case, Hotchkiss v. Greenwood, 52 U.S. 248 (1851), and noted that “[a]s is usual with a `doctrine’ derived from a court opinion, the doctrine persists while the facts out of which it arose are forgotten.” Id. at 859-60.

Judge Rich bemoaned the fact that, even after the statutory enactment of § 103 of the Patent Act, some still used the meaningless `invention’ or `inventive requirement’ phrase. He concluded his article with a series of propositions to reinforce “that when 103 has been complied with, there is no further and different requirement called `invention’; that compliance with 103 is the policy judgment of Congress on how to bring the invention within the Constitutional purpose.” Id. at 875.

Without referring to this history, the Supreme Court in Alice instructed that we ask whether there is such structure or something in the patent claim(s) that recites an `inventive concept’ “sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.” Alice, 134 S. Ct. at 2355 (quoting Mayo, 566 U.S. at 73). Beyond the question of ultimate meaning of the `inventive concept’ phrase, other questions abound. When we search for this significantly more `inventive concept,’ are we limited to the limitations of a particular claim in the patent? If not limited to the limitations in the individual claim, then what? Do the written description and the scope of other claims in the patent come into play, as perhaps they did in Step 1?

And adding a little more complexity to the matter, the Supreme Court has recognized that “[a]t some level, `all inventions . . . embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.'” Id. at 2354 (quoting Mayo, 566 U.S. at 71). With that in mind, we are left to ponder at what level of abstraction do we focus—put another way, how deep into the `elements’ do we dig when we search for that which is not `abstract,’ or for that non-abstract combination that saves an otherwise `abstract idea’ patent claim?

When the `abstract idea’ notion appeared in the law back in the 19th century, the requirement for `invention’ in its many variants—currently `inventive concept’—was also part of patent law. Then, as now, it seemed logical that something claiming to be an invention should have something called an `inventive concept’ at its core. And as a literary construct that is unexceptional.

As a decisional construct for validation of a property right—a patent—the idea of a necessarily underlying `inventive concept’ proved unworkable. The concept provided no discernable boundaries for decision-making in specific cases, resulting in an incoherent legal rule that led to arbitrary outcomes. Judge Rich, who devoted his life to patent law, saw this clearly, and gave the Congress a workable alternative—nonobvious subject matter— which they adopted.

The modern Supreme Court inherited this body of formulaic doctrine, and we now expect the Court to make sense of it. That they have failed is less a commentary on their efforts than on the absence of recognition of the problem on the part of the lawyers and judges who continue to treat these doctrines as if they were gospel.[15]

The Emperor Has No Clothes

My purpose in this discussion is not to critique the Court’s handiwork, but rather to highlight the number of unsettled matters as well as the fundamental problems that inhere in this formulation of `abstract ideas.’ In the short expanse available in a court opinion (and in the reader’s patience), it is not possible for me to recite all the issues and all the problems with the current law of `abstract ideas’ and its `inventive concept’ offspring.

I do, however, want to go on record as joining my colleagues who have recently expressed similar views about the current state of our patent eligibility jurisprudence, and to incorporate by reference their wisdom concerning the matter. Judge Richard Linn, concurring and dissenting in Smart Systems Innovations, LLC v. Chicago Transit Authority,[16] critiqued at length the `abstract ideas’ idea, both in general and as specifically applied in that case. More recently, Judge Alan Lourie, concurring in the denial of en banc rehearing in Berkheimer v. HP Inc., and referring to the complex of issues in our current § 101 jurisprudence, wrote that “the law needs clarification by higher authority, perhaps by Congress, to work its way out of what so many in the innovation field consider are § 101 problems.”[17]

I welcome their attention to this—when two of our leading judges who have devoted their careers to the practice and explication of patent law publicly proclaim that there is a real problem, there is a real problem. I do not mean to suggest that they are the only two such judges on the court—to my knowledge, other than myself, they are the only two who have gone on record in such clear terms regarding the law of `abstract ideas.’

There is almost universal criticism among commentators and academicians that the `abstract idea’ idea has created havoc in the patent law. The testimonials in the blogs and elsewhere to the current mess regarding our § 101 jurisprudence have been legion.[18] There has even been a call for abolishing § 101 by the former head of the Patent and Trademark Office.[19]

This view is shared by many patent practitioners.[20] A § 101 defense is widely employed, and often successful. For example, in the period following Alice until April 30, 2017, one study reported that the federal courts invalidated patents on § 101 grounds in 330 out of 488 decisions. See Bilski Blog, #Alicestorm: April Update and the Impact of TC Heartland on Patent Eligibility (June 1, 2017).[21]According to the same report, the Patent Trial and Appeal Board has invalidated patents on § 101 grounds in 90 out of 92 covered business method review final written decisions. Id.

These defenses are a shortcut way for alleged infringers to try for a quick dismissal of the infringement charge on the grounds that the invention underlying the infringement suit was never entitled to a patent. If successful, it saves having to go to the effort of proving in a fulldress law suit one of the statutory invalidity defenses found in §§ 102, 103, and 112 of the Patent Act.[22]

Indeed, some of these shortcut cases now arrive on appeal following a trial court’s summary judgment, or in some cases, even following a judgment on the pleadings or motion for dismissal. This has the effect of ensuring a minimal record or virtually no record at all on which an appeal can sensibly be judged.[23]

There is little consensus among trial judges (or appellate judges for that matter) regarding whether a particular case will prove to have a patent with claims directed to an abstract idea, and if so whether there is an `inventive concept’ in the patent to save it. In such an environment, from the viewpoint of counsel for the defense, there is little to be lost in trying the § 101 defense. We are left with a process for finding abstract ideas that involves two redundant steps and culminates with a search for a concept—inventiveness—that some 65 years or so ago was determined by Congress to be too elusive to be fruitful. Is it any wonder that the results of this process are less than satisfactory?

It would not be useful, or even fair, to fault today’s Supreme Court for trying to find some way to decide what is an abstract idea, or at the least for trying to find a way to decide the question. Or to fault this court for doing its best to honor the Supreme Court’s formula, even when the results demonstrated that the test did not produce coherent, readily understandable, replicable, and demonstrably just outcomes. The Supreme Court inherited the `abstract ideas’ idea from cases decided at a time when it probably sounded reasonable and had little impact. With the rise of software and business method patents, the `abstract idea’ became a weapon of choice for summary execution of what many decried as `bad’ patents. The problem is that it does not distinguish good from ill in any coherent sense, and thus does not serve well either patent law or the public.

When the lawyers and judges bring to the Supreme Court a shared belief in the uselessness of the abstract notion of `abstract ideas’ as a criterion for patent eligibility, we can hope that the Court will respond sensibly. In light of the statutory criteria for patent validity established in the Patent Act, there is no need, and indeed no place in today’s patent law, for this abstract (and indefinable) doctrine. Something as simple as a declaration by the Court that the concept of `abstract ideas’ has proven unworkable in the context of modern technological patenting, and adds nothing to ensuring patent quality that the statutory requirements do not already provide, would remove this distraction from the salutary system of patent issuance and enforcement provided by the Congress in the 1952 Patent Act.

The problem with hoping for this solution is that there is no particular incentive for the Supreme Court to immerse itself again in this intellectual morass. The Court, unlike this court, is not called upon daily to address the consequences of an incoherent doctrine that has taken on a life of its own. It will take a special effort by the judges and the patent bar to gain the Court’s attention. Failing that, a legislative fix is a possibility, though waiting for that may be the ultimate test of patience.

In the interim, a district court in an appropriate case might choose to exercise control over its docket by instructing a defendant who raises an `abstract ideas’ § 101 defense that the court will defer addressing that defense until first having the issues in §§ 102, 103, and 112 addressed. This need not be viewed as offending existing law since the `abstract ideas’ test would remain in the case, as would the Alice process; only the timing would change.

There would be a shift in trial court process from the current notion, held by some, that a determination of patent eligibility under § 101 is necessarily the first thing to be decided in every case. That notion can still remain true for cases challenging a patent on laws of nature and natural phenomenon grounds; only because of the problems inherent in testing for `abstract ideas’ would the § 101 test be delayed until determinations are made under the statutory standards that Congress established.

What would be the consequences of such a procedural delay? Even a cursory look at the claims in our recent § 101 `abstract ideas’ cases suggests how many of those cases would just go away as soon as the well-understood statutory criteria are applied to the challenged claims, especially the question of whether the claimed invention is new or just a replay of prior art (see § 103). Those who would quail at the supposed burden this might place on the trial judges should remember that is what trial judges do. And besides, the trial judges have already started using an alternative along the same lines: many patent infringement suits are now being stayed by the trial courts when there is a reference of the patent eligibility and validity issues (depending on the kind of case) to the Patent Trial and Appeal Board under the expedited procedures of the America Invents Act.[24]

Whether this court should take the initiative and instruct the trial courts to follow such a procedure raises somewhat more difficult questions. We have generally left the case management of those courts to the courts themselves, or to the circuit courts of appeal to which they normally report. For these reasons among others, our court presumably should have little difficulty with respecting a district court’s decision about how best to manage its own docket.

Regardless of what other courts may do, an appellate court’s job is not only to decide the immediate case before it, but also to rationalize and regularize the law to be applied in future similar cases. Judge Rich believed that words have meaning;[25] years earlier Professor Wittgenstein expressed well that same thought: “What can be said at all can be said clearly, and what we cannot talk about we must pass over in silence. . . . The limits of my language mean the limits of my world.”[26]

This emperor clearly has no clothes; we need not wait for our children to tell us this.[27] The legitimate expectations of the innovation community, as well as basic notions of fairness and due process, compel us to address this § 101 conundrum.

[1] See, e.g., Bilski v. Kappos, 561 U.S. 593, 601 (2010).

[2] The Supreme Court itself is not always consistent. Compare id. at 601-02 (referring to the “three specific exceptions”) with Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 70 (2012)(referring to the three categories as constituting one “exception”).

[3] That does not, however, preclude controversy. See, e.g., Ariosa Diagnostics, Inc. v. Sequenom, Inc.,788 F.3d 1371, 1380 (Fed. Cir. 2015) (Linn, J., concurring), reh’g denied, 809 F.3d 1282 (Fed. Cir. 2015) (per curiam denial with concurrences by Judges Lourie and Dyk and a dissent by Judge Newman). But see Robert R. Sachs, Bad Science Makes Bad Patent Law—No Science Makes It Worse (Part I), Bilski Blog (Sept. 13, 2016), http://www.bilskiblog.com/blog/2016/09/bad-sciencemakes-bad-patent-law.html (arguing that the courts have failed to accurately define `laws of nature’).

[4] 134 S. Ct. 2347 (2014).

[5] 566 U.S. 66.

[6] 841 F.3d 1288, 1294-95 (Fed. Cir. 2016).

[7] The American Heritage Dictionary of the English Language 872 (5th ed. 2011).

[8] Id. at 7.

[9] Cf. John Medina, Brain Rules (2d ed. 2014).

[10] See, e.g., Dava Sobel, Longitude 34 (1st ed. 1995) (“Time is to clock as mind is to brain. The clock or watch somehow contains the time. And yet time refuses to be bottled up like a genie stuffed in a lamp. . . . [I]t flows as sand or turns on wheels within wheels, time escapes irretrievably . . . .”).

[11] For example, compare In re Bilski, 545 F.3d 943, 959 (Fed. Cir. 2008) (en banc) proposing `machine-ortransformation’ as the test, with Bilski, 561 U.S. at 604, indicating that `machine-or-transformation’ is one test, “a useful and important clue” and “an investigative tool” but not the exclusive test and offering nothing better. See also the several opinions in this court’s CLS Bank International v. Alice Corp., 717 F.3d 1269 (Fed. Cir. 2013) (en banc), the harbinger of the Supreme Court’s Aliceopinion.

[12] See Oliver W. Holmes, The Path of the Law, in Collected Legal Papers 167, 173 (1920) (noting that rules of law are “prophecies of what the courts will do in fact, and nothing more pretentious”); see alsoKarl N. Llewellyn, The Bramble Bush: Some Lectures on Law and Its Study 3 (1930) (“What these officials do about disputes is, to my mind, the law itself.”). But cf. Michael C. Dorf, Prediction and the Rule of Law, 42 UCLA L. Rev. 651, 653 n.6, 715 (1996) (suggesting that “the prediction model undermines the rule of law by over-emphasizing the role of individual judges”).

[13] Some authorities attribute the resurrection of `inventive concept’ to Mayo, and to Justice Stevens in his earlier opinion in Parker v. Flook, 437 U.S. 584 (1978). For the history buffs, see Jeffrey A. Lefstin, Inventive Application: A History, 67 Fla. L. Rev. 565, 572-77 (2015).

[14] See also In re Bergy, 596 F.2d 952, 959-64 (CCPA 1979), vacated in part sub nom. Diamond v. Chakrabarty, 444 U.S. 1028 (1980), and aff’d sub nom. Diamond v. Chakrabarty, 447 U.S. 303 (1980); Giles S. Rich, Why and How Section 103 Came to Be, in Nonobviousness—The Ultimate Condition of Patentability 1:201 (John F. Witherspoon ed., 1980); Giles S. Rich, Principles of Patentability, 28 Geo. Wash. L. Rev. 393 (1960).

[15] See Amy L. Landers, Patentable Subject Matter as a Policy Driver, 53 Hous. L. Rev. 505, 517-18 (2015) (“Like an ice sculpture that is shaped by the parts that have been chipped away, the legal definition of invention is shaped by its exceptions. Decisions lack clarity. Their reasoning rests heavily on a limited field of precedent that is, in turn, written in opaque terms during a different technological era.” (footnote omitted)), and sources cited therein.

[16] 873 F.3d 1364, 1376 (Fed. Cir. 2017) (Linn, J., concurring-in-part and dissenting-in-part).

[17] 890 F.3d 1369, 1374 (Fed. Cir. 2018) (Lourie, J., concurring in the denial of rehearing).

[18] Regarding patent blogs, see just about any issue of Law360; regarding the innovation community, see, e.g., Intellectual Prop. Owners Ass’n, Section 101 Legislation Task Force, Proposed Amendments to Patent Eligible Subject Matter Under 35 U.S.C. § 101 (2017), http://www.ipo.org/wpcontent/uploads/2017/02/20170224_IPO-101-TF-Proposed-Amendments-and-Report_final.pdf.

[19] See Ryan Davis, Kappos Calls for Abolition of Section 101 of Patent Act, Law360 (Apr. 12, 2016), http://www.law360.com/articles/783604/kappos-calls-forabolition-of-section-101-of-patent-act.

[20] See, e.g., Peter Leung, The Federal Circuit’s Section 101 Uncertainty, Managing Intellectual Prop. (Sept. 29, 2015) (“Frustrated IP practitioners are hoping the court will soon change from telling them what is not eligible to providing some guidance on what is.”), http://www.managingip.com/Article/3491780/Latest-News-Magazine/The-Federal-Circuits-Section-101-uncertainty.html; Ryan Davis, Major [Companies], IP Groups Call For Clearer USPTO Alice Rules,Law360 (Nov. 2, 2015), https://www.law360.com/articles/722015/major-cos-ip-groups-call-for-clearer-uspto-alice-rules.

[21] http://www.bilskiblog.com/blog/2017/06/alicestormapril-update-and-the-impact-of-tc-heartland.html.

[22] See Paul R. Gugliuzza & Mark A. Lemley, Can a Court Change the Law by Saying Nothing?, 71 Vand. L. Rev. 765, 777 n.70 (2018), quoting Saurabh Vishnubhakat, The Antitrusting of Patentability, 48 Seton Hall L. Rev. 71, 104 (2017) for the proposition that “`[c]ourts’ use of subject-matter eligibility as a shortcut to other patentability requirements appears to offer significant savings in decision cost,’ but that `these savings likely come at the expense of higher error costs.'”

[23] But see Berkheimer v. HP Inc., 881 F.3d 1360, 1369 (Fed. Cir. 2018) (observing that “[w]hether something is well-understood, routine, and conventional to a skilled artisan at the time of the patent is a factual determination”); Aatrix Software, Inc. v. Green Shades Software, Inc., 882 F.3d 1121, 1128 (Fed. Cir. 2018).

[24] See Harness Dickey, A Look at Forty-Five Months of Inter Partes Review Proceedings Before the United States Patent and Trademark Office, http://iprpgr.com/wp-content/uploads/2016/08/IPR-PGR-Report-Vol-14.pdf (Aug. 24, 2016) (finding that 61% of all contested requests to stay were granted from September 16, 2012 to June 16, 2016 in the inter partes review context); Morgan Lewis, 2017 PTAB Digest: The Latest Trends and Developments in Post-Grant Proceedings, at 26, https://www.morganlewis.com/-/media/files/publication/report/ptab-post-grant-proceedings_fin_screen.ashx (2017) (estimating that 58% of all contested requests to stay were granted as of June 1, 2016 in the inter partes review context and that 61% of all contested requests to stay were granted in the same period in the covered business method review context).

[25] Giles S. Rich, Escaping the Tyranny of Words—Is Evolution in Legal Thinking Impossible?inNonobviousness—The Ultimate Condition of Patentability 3:301.

[26] Ludwig Wittgenstein, Tractatus Logico-Philosophicus, Preface at 3, Proposition 5.6 (1922).

[27] See Hans Christian Andersen, The Annotated Hans Christian Andersen 3-16 (Maria Tatar, ed., trans., & contributor, Julie Allen, trans. & contributor, 1st ed. 2008).

Some materials relating to “use” infringement and their oral arguments

Saturday, July 21st, 2018

I am thinking of writing an article or blog post about “use” infringement.  So, I thought I would post some materials here — mainly for my own use; but, perhaps others would be interested, as well.

Bauer & Cie v. O’Donnell, 229 U.S. 1, 33 S. Ct. 616, 57 L. Ed. 1041 (1913).

FastSHIP, LLC v. US, No. 2017-2248 (Fed. Cir. June 5, 2018).

Zoltek Corp. v. US, 672 F.3d 1309 (Fed. Cir. 2012).

GRECIA v. McDONALD’S CORPORATION, No. 2017-1672 (Fed. Cir. Mar. 6, 2018).  [Grecia Oral argument]

Intellectual Ventures I v. Motorola Mobility, 870 F.3d 1320 (Fed. Cir. 2017).[IV-I Oral argument]

Centillion Data Systems, LLC v. Qwest Communications Int’l, Inc., 631 F.3d 1279 (Fed. Cir. 2011).[Centillion Oral argument]

Uniloc USA, Inc. v. Microsoft Corp., 632 F.3d 1292 (Fed. Cir. 2011).[Uniloc Oral Argument]

NTP, Inc. v. Research in Motion, Ltd., 418 F.3d 1282 (Fed. Cir. 2005).

Fantasy Sports Properties v. Sportsline. com, 287 F.3d 1108 (Fed. Cir. 2002).

Decca Ltd. v. United States, 544 F.2d 1070 (Ct. Cl. 1976).

 

Technology Patents LLC v. T-MOBILE (UK) LTD., 700 F.3d 482 (Fed. Cir. 2012).[Tech. Patents Oral argument]

ResQNet. com, Inc. v. Lansa, Inc., 594 F.3d 860 (Fed. Cir. 2010).[ResQNet Oral argument]

Lucent Technologies, Inc. v. Gateway, Inc., 580 F.3d 1301 (Fed. Cir. 2009).[Lucent Oral argument]

Ex Parte Bhogal and Ex Parte Galloway

Thursday, July 19th, 2018

You probably already read the excellent article “Berkheimer, the Administrative Procedure Act, and PTO Motions to Vacate PTAB § 101 Decisions”  by Doerre and Boundy.

The article references two recent decisions by the PTAB applying Berkheimer.  Copies of those PTAB opinions are available below:

Ex parte Bhogal, appeal no. 2016-008742, (PTAB Mar. 19, 2018)

Ex parte Galloway, appeal no. 2017-004696, (PTAB May 24, 2018).

 

UPDATE JULY 20, 2018:

Here’s another PTAB decision applying Berkheimer, mentioned in the comments section for the above article:

Ex Parte Young, appeal no. 2017-006731, (PTAB June 29, 2018).

 

Thirteen years since Phillips

Monday, July 16th, 2018

Wow, it has already been thirteen years since Phillips was decided (July 12, 2005).  In Part IV-B of Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005), the en banc majority stated:

While we have acknowledged the maxim that claims should be construed to preserve their validity, we have not applied that principle broadly, and we have certainly not endorsed a regime in which validity analysis is a regular component of claim construction. See Nazomi Communications, 403 F.3d at 1368-69. Instead, we have limited the maxim to cases in which “the court concludes, after applying all the available tools of claim construction, that the claim is still ambiguous.” Liebel-Flarsheim, 358 F.3d at 911; see also Generation II Orthotics Inc. v. Med. Tech. Inc., 263 F.3d 1356, 1365 (Fed.Cir.2001) (“[C]laims can only be construed to preserve their validity where the proposed claim construction is `practicable,’ is based on sound claim construction principles, and does not revise or ignore the explicit language of the claims.”); Elekta Instrument S.A. v. O.U.R. Scientific Int’l, Inc., 214 F.3d 1302, 1309 (Fed.Cir.2000) (“having concluded that the amended claim is susceptible of only one reasonable construction, we cannot construe the claim differently from its plain meaning in order to preserve its validity”); E.I. du Pont de Nemours & Co. v. Phillips Petroleum Co., 849 F.2d 1430, 1434 (Fed.Cir.1988) (rejecting argument that limitations should be added to claims to preserve the validity of the claims). In such cases, we have looked to whether it is reasonable to infer that the PTO would not have issued an invalid patent, and that the ambiguity in the claim language should therefore be resolved in a manner that would preserve the patent’s validity.

Phillips v. AWH Corp., 415 F.3d 1303, 1327 (Fed. Cir. 2005).

So, it was interesting to read the dissent today in BLACKBIRD TECH LLC, DBA BLACKBIRD TECHNOLOGIES v. ELB ELECTRONICS, INC., ETI SOLID STATE LIGHTING INC., FEIT ELECTRIC COMPANY INC., __ F.3d __ (Fed. Cir. 2018), which stated:

The majority’s construction thus opens the door for the ’747 patent to be subsequently invalidated for failure to satisfy the written description requirement. Stated differently, the majority’s construction is a route towards rendering the patent invalid. See Carman Indus., Inc. v. Wahl, 724 F.2d 932, 937 (Fed. Cir. 1983) (“Claims should be so construed, if possible, as to sustain their validity. If such a construction would result in invalidity of the claims, the appropriate legal conclusion is one of noninfringement, not invalidity.”). The majority likewise invites an enablement challenge; under the majority’s approach, the retrofit aspect of the invention is merely an afterthought, one for which a skilled artisan must figure out for themselves the means by which the retrofit function of the invention shall be achieved, without any guidance from the patent. See Maj. Op. at 9. This result is absurd, given that when the patent is read as a whole, such guidance is clearly provided.

BLACKBIRD TECH LLC, DBA BLACKBIRD TECHNOLOGIES v. ELB ELECTRONICS, INC., ETI SOLID STATE LIGHTING INC., FEIT ELECTRIC COMPANY INC., __ F.3d __ (Fed. Cir. 2018)(slip opinion at pp. 4-5 of the dissent).

It is interesting that this topic crops up from time to time.  I believe there is still a slight disagreement within the court as to whether claims should be construed to preserve their validity, regardless of ambiguity — despite what Phillips says.

Article suggestion

Sunday, July 15th, 2018

I find it curious that the Federal Circuit only publishes the names of its panel members on the morning of an oral argument.  Some of the other circuit courts of appeal publish the names of the panel members far longer in advance. For example, the Tenth Circuit has already published panel membership for arguments two weeks in the future: [Link].  If I recall correctly, the Federal Circuit experimented with a longer notification period; but, eventually, the court resumed its previous and now current practice.

It would be interesting to see a short article that compares the various circuits and the amount of notification given to the parties about the composition of a panel.  What seems implicit in the Federal Circuit’s short lead time is the notion that the court is so badly fractured that advocates will focus their arguments to cater to the particular panel members.  One benefit I see to a longer lead time is that an advocate would probably know how much technical explanation would be required during oral argument depending on the composition of the panel.  For example, a panel comprised of Judges Hughes, Dyk, and Reyna might need more technical background on an electronics case than would Judges Moore, Stoll, and Linn (some of the EE judges).

Mark Twain and the Federal Circuit

Saturday, July 7th, 2018

Next door to the Federal Circuit sits a statue of a somber woman in a cowl.  The statue is a replica of a statue that Henry Adams (grandson of President John Quincy Adams) commissioned after the death of his wife.  In 1909, Mark Twain visited the original statue and gave it the nickname “GRIEF.”

The replica — ironically, an unauthorized replica — eventually made its way to the courtyard behind the Dolley Madison House, next door to the Federal Circuit.

“THE RULE 36 STATUE”

If the original was nicknamed “GRIEF,”  what would be a good nickname for the replica?  How about “THE RULE 36 STATUE” or “THE SUPREME COURT WEIGHS IN ON PATENT ELIGIBILITY.”  Maybe “FIRST INVENTOR TO FILE.”

I am somewhat reminded of the dust bowl photograph by “THE RULE 36 STATUE”: