8/30/11 – INTRODUCTION TO THE PATENT SYSTEMBonito Boats v Thunder Craft Boats (US 1989) – printout – State cannot pass law that interferes with US patent law. Also, can’t take something out of the public domain once it is there.Florida passes a law that creates a sort of exclusivity for the manufacturer of boat hulls – USSC said that FL was granting protection for something that should not be protected

Also: boat hull was in the public domain for a long time before FL passed the statute, removing it from the public domain; all they’re conferring then is the monopoly with no additional incentive to innovate

Section 112: paragraphs 2, 3, 4, 6 – describe claim requirements2. there must be claims3. indep or dep claims4. dep claim incorps by ref all the limitations of the claim to which it refers6. can do “means plus function” without describing function

With first few words: delimit the type of invention you have “A cup holder”Then, transition: comprising (broad), consisting of (narrow), consisting essentially of (in between)You always want to use “comprising” unless you are forced to use “consisting of” to avoid prior art

Larami Corp v. Amron (EDPA 1993) – printout – Each and every element of a claim must be infringed.P made Super Soakers: sued for declaration of non-infringement of D’s patents (rather than wait for D to sue them for infringement)No infringement: why? Super soaker has EXTERNAL water tank; claims require the water tank to be INTERNAL

Paragon Solutions v. Timex (CAFC 2009) – printout – Courts can use contextual clues to construe meaning of claimsP sued D for infringing P’s ‘759 patentTwo claims at issue

One for data acquisition unitOne for real time displayData acquisition unit:Parties dispute whether the DAU has both the GPS device and the physiological monitor

Argument: claim says that display unit is separate from DAU; since claim doesn’t say that GPS device is separate Structure of the claim points to DAU being one unit with two parts

Also, claim 29 – display unit What is support for the two being separate? 29 recites display unit being separate from GPSCourt says that it is not 1 part with 2 subparts; however, it is some arrangement of parts that together forms a display functionDisplaying real time data: “instantly” or “a little bit longer than instantly” – Timex wants “instantly” because they have a tiny bit of delay in their displayIf you’re the infringer, you want a very narrow constructionCourt first notes that it cannot be “instantly” because, physically speaking, there must be some delayCourt decides that it means “no intentional delay” (b/c of dictionary) – all infringer now has to do is create something with an intentional delay

Contextual clues – 30 second delay in mountain climbing is essentially “real time” – same delay in this case, however is not “real time”.

9/6/11 – PATENTABLE SUBJECT MATTER

35 USC 101 – 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.

O’Reilly v. Morse (US 1854) – inventor of telegraph could not claim all future uses of electromagnetism to mark/print letters at a distance – you cannot patent a principle.-The Telephone Cases (US 1888) – p. 121 – you can patent an application of a principle, as long as you are not claiming all possible/future/not even considered yet uses of the principle.

Diamond v. Chakrabarty (USPQ 1980) - p. 68 – a human-created bacteria was patentable, because it was not a “hitherto unknown natural phenomenon” but “a nonnaturally occurring manufacture or composition of matter – a product of human ingenuity”– human-created bacteria with desirable trait (eating oil) WAS patentableChakrabarty took plasmids for four different bacteria and put them into one bacterium

Funk Bros. Seed Co. v Kalo Inoculant (USPQ 1948) – p. 160 – Mixing a variety of bacteria together, even if it has useful qualities compared to other mixtures, does not change the properties of any of the individual bacteria, and is therefore unpatentable as a product of nature.

Parke-Davis & Co. v H.K. Mulford & Co. (SDNY 1911) – p. 164 – A purified/isolated natural substance IS patentable, especially where, as here, there were many unsuccessful efforts to purify it. There must be some sort of transformation for a naturally occurring product to be patentable.

Association for Molecular Pathology v USPTO (Myriad case) (CAFC 2011) – printout - See chart below for “holding”.

Judge Holding Rule AnalysisSweet Nothing Must be “markedly different” from product

as found in nature – purification alone is insufficient

Informational content is identical before and after isolation – DNA’s purpose is to make proteins

Lourie (chemist)

All is patentable (except one method)

Different physical characteristics It is a different physical product than what is found in the body

Moore (academia)

Same Must be “markedly different” with the potential for significantly new utility

cDNA not found in natureshort fragments – useful for gene sequencingfull length genes (or close) – no new utility, not materially different – however, not judiciary’s place to take these

patents awayBryson (public servant)

Only cDNAs are patentable

Looks at character and function (baseball bat is extracted from tree, but extraction changes the nature of the tree – extracting gene does not really change the nature of the gene)

Changes are incidental – snapping leaf from tree creates some changes but they are irrelevant – ultimately the point of the gene is to convey information

1. BRCA DNA – introns/exons etc2. cDNA5. any DNA having at least 15 nucleotides from claim 1Gottschalk v. Benson (USPQ 1972) – p. 135 - Respondents' method for converting numerical information from binary-coded decimal numbers into pure binary numbers, for use in programming conventional general-purpose digital computers is merely a series of mathematical calculations or mental steps and does not constitute a patentable "process" within the meaning of the Patent Act. Also – ways to differentiate between an idea and an application.

Diamond v. Diehr (US 1981) – p. 145 – Even though you can’t patent an algorithm, you can patent a process that incorporates an algorithm; the mere presence of an algorithm doesn’t render something unpatentable.- process for curing rubber which incorporates a curing algorithm (Arrhenius equation) and real-time temperature measurements. SC says this IS patentable – not trying to patent the equation, but a process that USES the equation

State Street Bank & Trust v. Signature Financial Grp. Inc. (CAFC 1998) – printout - A claim is eligible for protection by a patent in the United States if it involved some practical application and it produces a useful, concrete and tangible result.Hub and spoke system for mutual fund – pool of assets that invests assets from multiple investors, investors share in the proceeds – something like a supermutual fundCourt says this is patentable because it creates a “useful, concrete and tangible result” – a very literal interpretation of the SC’s “transformation” requirement”

In re Bilski (CAFC 2008) – printout - The "useful, concrete and tangible result" test of State Street should no longer be relied on. A method claim is surely patentable subject matter if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. (MACHINE OR TRANSFORMATION TEST)Bilski goes up to SC:Bilski v. Kappos (US 2010) – printout – The Machine-or-transformation test is helpful for determining if a method claim is patentable, but it is NOT the only test.Court still says Bilski’s invention is unpatentable, because it is unpatentable

-machine or transformation test is not the only testRules and standards – 3 different rules that have been developed

Kennedy – no abstract ideas – broader than a business method, much more “standard-like”CAFC – machine or transformation – narrower than abstract idea, but broader than “no bus methods”

– somewhere between a standard and a ruleStevens – no business methods – reasonably straightforward rule

Lab Corp v. Metabolite (SC 2006) – p. 127 – justice Breyer – this is only dicta (case was dismissed for not properly briefing issues below (?)) – method that amounts to making a simple correlation is NOT patentable.

Method for detecting deficiency of B12 and folic acid in warm blooded animals, comprisingAssaying a body fluid for an elevated level of total homocysteine, and correlating an elevated level with a deficiency of B12 or folic acid -this is something that happens in the body, completely natural

Prometheus Labs v. Mayo Collaborative Services (CAFC 2010) - printout – A process of medical treatment is patentable despite involving a correlation because there were significant other steps that used the correlation, and the patenting wouldn’t preempt an entire field. (being briefed/argued this term in SC)Therapeutic efficacy – administer drug, determine level of drug – if above Y, deliver less drug, if above X, deliver more drug.CAFC – natural correlation are part of a process of medical treatment, and this is closer to Diehr than to Lab Corp, and doesn’t preempt an entire fieldAssociation for Molecular Pathology v. USPTO (Myriad case) (CAFC 2011) – claims comparing a sample sequence to an example sequence are unpatentable.-merely “comparing” fails the transformation test - these are mental steps (interesting b/c the “if there is a mental step, it is unpatentable” doctrine has been abandoned)Distinguish Prometheus - determining step in Prometheus could not be determined by mere inspection – had to do some sort of bloodwork (a transformation). Here, the determining step was done by mere observation

Classen Immunotherapies v. Biogen (CAFC 2011) – printout – a comparison is patentable if it is part of a larger claim where the comparison is a precursor to some other step (?).Method of figuring out an immunization schedule, by comparing two different schedules2 claims at issue

1. identifying 2 groups of mammals immunized according to different schedules, comparing effectiveness and immunizing a subject based on the better schedule for avoiding immune disorders

2. determining whether an immunization schedule affects immune disease development by comparing 2 groupsCourt says – last step in claim 1 is transformative (carrying out immunization) – claim 1 patentable, claim 2 not.4 principles from this line of cases:

a. can’t patent a principleb. machine or transformation test is helpful, but not exclusivec. have to look at the claim as a whole (can’t deconstruct)d. post-solution activity must be significant (to the extent that a claim incorporates an idea, whatever

you do with that idea must be real)

UTILITY (112 p 1, maybe 101)

3 PARTS OF UTILITY DOCTRINE1. Operable utility - your shit’s gotta work” – can’t patent a perpetual motion machine, or warp drive. However, don’t want this to be too strict a screen – don’t want to prevent unforeseen inventions from being patented

-PTO has the initial burden of producing evidence that those skilled in the art would not find the claim credible. If it does, inventor has to provide proof of operability at the time of application

-bar is not “it must work as you say, in every instance” but that PHOSITA would find claim not to be credibleFunctionally – PTO doesn’t challenge this very much

2. Beneficial utility

Lowell v. Lewis (MA 1817) – P. 216 – An invention need not be an improvement on all technology to have utility. It merely must be functional and “non-injurious to moral fabric over society.Pump – not much of an improvement in pump technology. Still ok - Does not need to improve on prior art

Juicy Whip, Inc. v. Orange Bang, Inc. (CAFC 1999) – p. 218 – Even a misleading use may have utility, and the fact that something is misleading does not automatically strip it of utility; as long as there’s “some identifiable benefit,” you’re good.Drink machine made to look like there is a reservoir of liquid prevent – people are more likely to buy if they think liquid circulating is the product. OK - deceptive trade practice does not render it unpatentable –

3. Specific utility – most important oneBrenner v. Manson (USPQ 1966) – p. 226 – a novel process for making a known steroid did not satisfy the utility requirement because the patent applicants did not show that the steroid served any practical function. The Court ruled, "… a process patent in the chemical field, which has not been developed and pointed to the degree of specific utility, creates a monopoly of knowledge which should be granted only if clearly commanded by the statute."--no patent because potential uses not enough, the chemical steroid's specific purpose must be identifiedProblem – even though somebody else came along and found a use, the prior inventor didn’tBetween the two inventors, the one who found a use at the time of filing wins

Court says “patent isn’t a hunting license”

In re Brana (CAFC 1995) – p. 234 – Invention was patentable because the specification presented a specific disease against which the claimed compounds were alleged to be effective. Therefore, their spec does allege a sufficiently specific use.

In re Fisher (CAFC 2005) – p. 244- Uses for specific ESTs were not specific to the claimed ESTs, but were applicable to all ESTs. Therefore, there was insufficient utility. Also, there was insufficient utility because there was no known use for the proteins produced by the process described in the patent.Holding – uses are too general – lack of specific utility – are uses that any EST could be used for

Evaluation of the end you put it towards – avoid the “red spider” problem (you have a big vat of chemicals; don’t know what to do with it, but you know that if you put a red spider in it, it dies; can’t claim that the product is a good spider-killing agent) (also – landfill option)ure research

DISCLOSURE – 4 doctrines – enablement – requires invention be described clearly enough so that PHOSITA could make/use/sell– written desc – is spec sufficiently detailed to match the scope of the claims-Definiteness – has to do with the claim itself – claim must be definite

-Best mode (gone in a year) – must disclose what you think is most effective means for practicing the invention-still intact, but no longer a basis for finding patent invalid

ENABLEMENT – section 112, paragraph 1The 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 of carrying out his invention.

In re Wands (CAFC 1988) – p. 277 – 3 categories of factors to look at when determining the sufficiency of disclosure/whether undue experimentation is required:

-what others had to do (how many experiments required to figure out)-nature of patent/invention/field (skill of those in field)-what patentee did disclose (guidance/working examples)– claim has to be enabled AS OF THE TIME OF THE APPLICATION (like utility)

PTO says – your success rate is too low – somebody else will require too much experimentation – 2.8%Applicant (and court) – you can’t count the things we didn’t test – we had a 44% success rateWands factors (3 categories) (see page 281 for the full list of 8 factors)

-what others had to do (how many experiments required to figure out)-nature of patent/invention/field (skill of those in field)-what patentee did disclose (guidance/working examples)

2. Speculation and prophesy (OR, speculation vs. prophesy)Janssen Pharmaceutica v Teva Pharms (CAFC 2009) – p. 287 - “The utility requirement also prevents the patenting of a mere research proposal or an invention that is simply an object of research. …a patent is not a hunting license. It is not a reward for the search, for compensation for its successful conclusion.’ A process or product ‘which either has no known use or is useful only in the sense that it may be an object of scientific research’ is not patentable… inventions do not meet the utility requirement if they are ‘objects upon which scientific research could be performed with no assurance that anything useful will be discovered in the end.’”Generally, you don’t need a working model on hand, as long as you can provide enough detail that a PHOSITA will be able to (constructive reduction to practice)This case suggests – there is a limit – some unrelated data + logical reasoning is insufficient to convince PHOSITA that invention will workAfter Janssen – extent to which courts will differentiate“prophesies” are ok – laying out a series of logical steps explaining why your invention will work is OKThis is differentiated from ‘speculation”Tension here – enablement vs. nonobviousness

The Incandescent Lamp Patent (US 1895) – p. 266 – “Carbonized fibrous or textile material” is too indefinite; not every material fitting this description was a suitable filament.Sawyer patent – contains “all carbonized fibrous or textile material” as filament – spec included only carbonized filament of paper. Edison comes along and does search of 6000 types of fiber – finds one type of bamboo that works best. Held that Sawyer claimed too broadly.Broad patents are ok, if the applicant actually enables the broad fieldWhat could patentees have done differently?

-narrow claims (avoid claiming theories)-provide lots of examples so you can try to generalize up

Suppose they’d tested several hundred fibrous materials and they all worked just about as well as the carbonized paper – could they have patented all of them? (probably, as long as he identified a class characteristic that bound all of them together)

Amgen v. Chugai Pharmaceutical (CAFC 1991) – printout- patenting any DNA sequence that would encode a 165-nt peptide was not allowed, as there are an enormous number of such sequences; you don’t have to test every sequence, but the scope of the claim must be at least “commensurate” (see also, however: problem of “inventing around”). Disclosure was insufficient under 112.Patent was for a DNA sequence that would encode a polypeptide with a specific amino acid sequence165-nt long peptide – could be a ton of analogues thanks to degeneracy of code, and, to a lesser extent, non-crucial differences in the amino acidsSpec is limited – have one sequence, plus a whole bunch they haven’t tested, disclosed – try to claim every sequenceProblem – Amgen claimed as it did, b/c if all that Amgen got was the single sequence, somebody could easily use a slightly difference sequence and design around the patent

Why not just let the patent issue on the broad claim?-would discourage people from doing followup research – why try to invent something that is covered, even if you might win at trial?Counter –Incentivize people to come up with improvements, not just workarounds

WRITTEN DESCRIPTION (sec 132, 120)

-demonstrate that applicant is in possession of the inventionAriad v. Lilly – establishes that there is a separate written description requirement (this may change; this area is evolving)Historically – one purpose on WD – limiting scope of amendments

2 sections that are most important132 – allows continuation of prosecution, but precludes any new matter – bound by what you disclosed originally120 – gives benefit of earlier filing date to continuing app, as long as there is continuity of disclosure

Gentry Gallery v. Berkline Corp (CAFC 1998) – p. 306 – if spec only enables one thing, you cannot then claim broader than that one thing. (you can’t change your claims to exceed the scope of your disclosure).Gentry claimed a sofa with two recliners with a fixed console in the middle, where the controls for the recliner were mounted on the center console – solved problem that reclining sections always had to be on the endSpec only describes controls as being on the console – also says console is only necessary for housing controlsClaim 1, however, doesn’t limit controls to console (this was amended, the original claim limited controls to console)Held – they fail the written description requirement – spec is so clearly limited to console with controls that they can’t then claim broader than that

Ariad v. Eli Lilly (CAFC 2010) – p. 316 – There is a written description requirement that is separate from enablement. desc must “clearly allow PHOSITA to recognize that the inventor invented what is claimed” or “reasonably convey to those SITA that inventor had possession” (actual or constructive)what is the difference between enablement and written desc? How can you tell? (short answer – you can’t)Figuring out how to inhibit a transcription factor from binding to DNA. 3 different theories.Court holds claims invalid – haven’t provided any actual description of particular molecules that can carry out their theorieshaven’t specified how any of these 3 theories might work, in practiceOverall governing standard – desc must “clearly allow POSITA to recognize that the inventor invented what is claimed” or “reasonably convey to those SITA that inventor had possession” (actual or constructive)Court holds WD inquiry is objective, looks at “4 corners” of app, but it is a question of fact, reviewed with deference to the lower court

A few principles to keep in mind1. constructive RTP is still ok, but actual RTP is not enough – still must be described2. no field limitations3. WD and enablement often go hand in hand, but at least in theory, there are a set of claims for which undue

experimentation is not necessary, but inventor did not invent4. claims that claim a function must have a spec that discloses sufficient materials to accomplish the function5. no basic research exception

Genus-species problem

Regents of UC v. Eli Lilly (CAFC 1997) – printout – can’t claim a genus via disclosure of a species – must claim some unspecified number of species in the genus, or the structural features common to members of the genus (is this actually the rule of law that comes out of this case?)disclosure of one mammal’s DNA did not suffice to allow claiming of all mammalian insulinCourt says you can’t claim a genus by disclosing one example of a species-need to disclose some unspecified number of species in the genus, or the structural features common to members of the genus – PHOSITA must be able to understand the genus by generalizing

Basic researchInterplay between WD and enablement

INDEFINITENESS

basic research – universities that receive federal research $ are encouraged to patent their discoveries – they tend to be patenting very early stage researchUniv of Rochester v G.D. Searle & Co. (CAFC 2003) – printout – can’t just claim basic research in a patent – must actually provide enough description so that PHOSITA can identify invention/how to practice the invention (in this case, what specific compounds were used to inhibit COX 2)aspirin and advil cause an upset stomach b/c they act indiscriminately to inhibit 2 different enzymes – COX 1 and COX 2 – COX 2 causes pain, COX 1 is important for stomach – so, you get pain relief and stomach problemstheory – if you could come up with a drug that selectively inhibited COX 2, you would be awesome.

2 claims at issue here – Method of identifying compounds that selectively inhibit COX 2 (an assay)Method of selectively inhibiting COX 2 (claim says this is done by administering a drug that inhibits COX 2.

THANKS FOR CLARIFYING THAT, SCIENTISTS)Held – claims are invalid – PHOSITA couldn’t tell exactly what compounds were to be used in this method, so they failed WD req.Bayh-Dole act doesn’t lower standards for patentability

Lizardtech v. Earth Resource Mapping (CAFC 2005) – printout – can’t claim broader than what is described.Spec and claims say different things - Spec says that invention is a seamless wavelet, where seamlessness is caused by maintenance of updated sums, but claim 21 does not include “maintain updated sums” language – claiming seamless and non-seamless wavelet transformsArgument for WD – claim is broader than what was describedArgument for Enablement – PHOSITA wouldn’t know how to make/use invention by reading the spec (claim is non-seamless, not disclosed)WD is an easier way to determine if inventor actually has possession of invention.Prof – WD cases come down to visceral fear on court’s part about patenting fruits of basic research

DEFINITENESSAddresses 112 Paragraph 2 - The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention.If boundary of claim is fuzzy, it forces competition to give a wide berthOrthokinetics v. Safety Travel Chairs (CAFC 1986) – p. 337 – definiteness is to be defined by a PHOSITA; here, a PHOSITA would understand that “so dimensioned” would vary by car.Invention is a wheelchair that can be inserted into car without folding up/removing passengerControversial language – front leg portion is so dimensioned as to be insertable through the space between the doorframe of an automobile and one of the seats thereof. Even though – “so dimensioned” changes from car to car, a person operating in this field would know what it means, even if it is variable. it is definite because in this field, a PHOSITA would know you need to measure itStandard Oil Co. v. American Cyanamid (CAFC 1985) – p. 341 – if a term has no standard definition and is not defined in the specification, it is indefinite.Chemical engineer couldn’t understand exactly what “partially soluble” means – held invalidCourt uses extrinsic evidence – textbooks, testimony-PTO wants to avoid getting into indefiniteness disputesEnzo Biochem. V. Applera (CAFC 2010) – printout - “Provided that the claims are enabled, and no undue experimentation is required, the fact that some experimentation may be necessary to determine the scope of the claims does not render the claims indefinite.”If it is capable of construction, even if reasonable minds would disagree as to construction, then it is not indefiniteExxon – “if it is discernable…held claim sufficiently clear to avoid invalidation on indefiniteness grounds”Problem here – linkage group is defined functionally, not structurally, as “not interfering substantially”Court looks to intrinsic evidence – spec, other claims, examples in a declaration, general criteria, prosec history

CANNOT use spec to limit claims (sometimes difficult to tell if you are informing or limiting the claim)

Numerical specificity is also not required – must just be a plausible rangeFunctional claiming is also permissible

BEST MODESec 112, paragraph 1 – inventor “shall set forth the best mode contemplated by the inventor of carrying out his invention.”new statute – 35 USC 282 – best mode is no longer a defense for infringement/validity suits

this requirement is technically still here, but there don’t appear to be any consequences to not having a best mode during litigation.best mode has to determine mindset of inventor – litigated ex ante – tough to determine mental stateexaminer can make a request for info under section 105 about best mode, to inventortwo part test used by CAFC – does inventor have a best mode? Subjective requirement – if no, no need for disclosure – sometimes an inventor will be indifferent. Judges in light of scope of invention (Chemcast)you could disclose a best mode and bury it in a list of many methods – PTO can’t ask you to identify which one is the best modescope of best mode depends on how the invention is conceivedarguments in favor of best mode req – shouldn’t be allowed to benefit from patent monopoly while keeping the best mode of using invention a trade secret – detracts from quid pro quo-encourages further disclosureAgainst – subjective – needs lots of circumstantial evidence-disclosure is usually of little value (except for chemical industry)US, until recently, was one of very few countries that required a best mode

Bottom line – important to know best mode, but basically a dead letter moving forward

NOVELTY AND PRIORITYNew novelty statute goes into effect march 16, 2013 – old statute continues to matter, litigation on older-style patents will continue into 2020s

Basic inquiry – is what you’re claiming in the patent known or published in the world at the relevant time?3 questions –Is what you’re comparing the patent against relevant? (will talk about next class and the one after)Is the timing of the prior reference sufficient that the prior reference predates the current invention? (big change with new patent act)Does reference cover the subject matter of the patent? (today – law of anticipation)

35 USC 102 – AnticipationBasic rule – to anticipate, a single prior art reference must disclose every element of the claimIf it does, then the patent is invalid(this is the same standard we use for infringement – “that which infringes, if later, would anticipate, if earlier”)-importance of claim chart – however, the entirety of the prior art matters, not just the claims (if it is a patent)1. The Identity Requirement

In re Robertson – (CAFC 1999) – p. 371 - All elements must be in the prior art in order for an invention to infringe.Disposable diaper with fastening and disposal system (in both present application and prior art)

Elements Robertson’s claim Prior art (Wilson)Closure member with first fastening element

X X

Landing member with second fastening element engageable with first fastening element

X X

Disposal means with… X X…third fastening element engageable with first fastening element

X Nope (according to majority), yes (according to concurrence)

Other things X ?( according to majority), no (according to concurrence)

Prior art – says you can roll up diaper, but there is no separate third fastening element; can use the first two fastening means to roll it upIssue – majority says that Robertson’s claim requires separate fastening element, concurrence says no(if Wilson were invented later – Wilson would not infringe because it doesn’t have the third element)

You can actually get anticipation from fields other than the field where the invention is from – see In re Schreiber (popcorn/oil dispensing tip)

Inherent invention – can be anticipated by something if the prior art inherently discloses your invention, even if your invention isn’t claimed or described fully

“That which infringes, if later, would anticipate if earlier.”

Tilghman v. Proctor – substance of patent was present in the steam engine -

2. Accidental and unknown anticipations:In re Seaborg (CCPA 1964) – p. 380 – the production of a minute amount of some chemical as a byproduct in earlier work does not anticipate the chemical. Claimed element 95, and isotope of element 95. Prior art – Fermi reactor (nuclear reactor) which, by definition, produces trace amounts of element 95 (hundred-millionths of a gram scattered amongst 40 tons of material)Held – no anticipation – amount created is miniscule, completely undetectable. Point of reactor is not to create element 95, but to produce powerrecognition is not so relevant – important thing is if the invention existed in some meaningful quantity

Schering Corp v. Geneva Pharmaceuticals (CAFC 2003) – p. 384 – If patenting a metabolite (or something else) would essentially take something upstream out of the public domain, it may not be patented, as it is anticipated by the public domain thing.Schering produced Claritin – compound was loretadine; extremely valuable, but was expiring; Schering then gets a patent on the first metabolite of loretadine, DCL (“evergreening”)

Held – second patent was anticipated by the first patent – first patent necessarily involved DCL because all of the loretadine would become DCL; during pharmaceutical testing, they saw there was DCL in the body. Distinguishes Seaborg – on quantity terms Also – by patenting DCL you would prohibit public from practicing loretadine – this is against policy, removing something from public domain

Smithkline Beecham v. Apotex (CAFC 2005) – printout - prior art was sufficient because it disclosed the manufacture of PHC anhydrate that naturally results in the production of the claimed compound (PHC hemihydrate). However, the court stated that a mere possibility of inherency is not sufficient for anticipation. (Citing Schering Corp.).(facts are very similar to Seaborg – public benefits rationale)Holding – later patent is invalid1970s – ‘196 patent produces trace, undetectable amounts of PHC hemihydrates.1980 – ‘196 patent licensed to SK1986 – SK files patent app, issued as ‘723, claiming PHC hemihydrates1998 – Apotex tries to market PHC anhydrateSK says – Apotex’ PHC anhydrate will necessarily produce trace amounts of PHC hemihydrates

Edison Elec. Light Co. v. Novelty Incandescent - public benefit theory - “It thus gave nothing to the world”

Abbott Labs v. Baxter Pharma. Products (CAFC 2006) – printout - can’t patent new characteristics of an existing product, because those characteristics are inherent; even if they are unappreciated, they are nonetheless thereheld – prior reference anticipated, claim was invalidnew characteristic was part of the old patent, even if it was unappreciated at the timenew characteristic was combining water with product to improve shipping/storage stability – can’t patent new characteristics of an existing product, because those characteristics are inherent; even if they are unappreciated, they are nonetheless there.

Problems with use patents –-tougher to enforce-use patents are restricted just to that use-use patents can’t be enforced without license to patentholder of product

Can sue sellers of product for inducing infringement

Does policy against removing something from the public domain make sense?

3. The “Enablement Standard” for AnticipationEnablement – is prior art enabling of the claim?Similar enablement standard to 112, but slightly differentBefore PTO, under 112 - Aimed at teaching those skilled in the art to use the patent, in exchange for the patent rightNow – for 102 – PHOSITA needs to be able to make or use the invention – slightly lower

In re Hafner (CCPA 1969) – p. 391 – “The standard for what constitutes proper enablement of a prior art reference for purposes of anticipation…differs from the enablement standard under 112.”a disclosure inadequate for enablement may be sufficient to anticipate.-a disclosure of a product does not necessarily anticipate a process

Why do things have to be novel?-incentive to create new works – granting a monopoly on existing works doesn’t incentivize anything

Pennock v. Dialogue (US 1829) – p. 519 – an inventor cannot patent an invention after it is already in widespread use (over one year, under old 102; zero time under new 102)Inventor created new type of hose, sold it for many years, and then filed a patent applicationCourt says – can’t do this – 2 rationales

a. abandonment – effectively abandoned his invention by licensing/producing it, gave it up to the public domain (intent to commit something to the public domain

b. on sale bar – must choose between “trade secret” (which may be discoverable) and “patent” (which is disclosed but definitely gives you exclusive rights) (may not require showing of intent to abandon, includes 3rd party sales

Why do we have this doctrine?Forces you to apply for patent early, thereby getting information into public domainLimits the amount of time that the monopoly exists

Here, the patent was for a process, but the product was on sale; does this matter?-idea that you can’t commercially exploit your invention prior to invention

Basic structure of novelty analysis (see powerpoint) - -“critical date” (was d.o. invention, now is d.o. filing)Point – if you invent, then file within a year, that’s ok (or at least your chances don’t go down) – after a year, you may run into statutory bars

New section 102:a) defines prior art

1)patented, printed pub, public use, sale, otherwise available to public before effective filing date2)effectively filed before effective filing date (this establishes “first to file”) system.

b) defines exceptions1) a) disclosure coming from applicant

b) disclosures by others made after “public” disclosure by the applicant2) a) 1st filer derived invention from 2nd filer

b) 1st filer filed after “public” disclosure by the applicant.c) common assignee (don’t worry about this for now)

no such thing as “swearing behind” anymoregrace period as to 3rd party art is limitedNote – this is kind of “first to file OR PUBLICALLY DISCLOSE”.

Printed publications and patents:What constitutes prior art, and in what circumstances?

Jockmus v. Leviton (2nd cir 1928) – p. 413 – a printed publication need not be widely distributed or demonstrate every element of a claim in order to act as prior art.Patent for adjustable lightbulb holder in the shape of a candleCatalogue released prior to patent had an image of the holderEven if it didn’t show every single element of the claim, it still showed the productEphemeral nature of the catalogue didn’t matterIt was widely distributed – 1000 copies (uncorroborated testimony from the catalogue publisher)Obviously meant to be seen; high quality catalogWhat if it were distributed in smaller quantities? Distributed to 50 people in a candlestick club?Must consider audience – if filled with PHOSITAs, probably need fewer people b/c they will understand itHowever, smaller number of people, if this means there is an intent to keep it secret – this may weigh against this being a public disclosure

For anticipation – need to have every element of the claimEnablement – picture would somehow have to enable (make or use)

In re Klopfenstein (CAFC 2004) – p. 415 – prior art does not always need to be distributed through formal publication to count as “published”. Various factors determine if something is published widely enough.Reference comes from poster presentation at a conference - Printed out slides and put on posterboard, available for 3 days. This counts as something that’s printed, because the slides were posted and available for everybody to see/copy/write notes about.

Just standing up and talking doesn’t countWhat about talking, using powerpoint slides? No – transient slides don’t countWhy should it matter if you distribute slides or not?Ephemeral presentation doesn’t enable?Much easier to admit printed presentation into evidencePublication – basic standard is “public accessibility”.“accessibility” –

Duration of displayConsider distribution and indexing

Can person obtain the info?What can a person do with the info?

An obscure publication is accessible, even if nobody would know where it is (indexing is important)(see discussion of Cronyn and Hall)

“public”What factors here suggest that it was sufficiently public?

-out in the open- specialist audience (that would be more receptive to it)

-no request for nondisclosure (or maybe a norm of nondisclosure [Aluminum Co. v. Reynolds])Generally context sensitive

10/25/11

Reference – something that could predate a patent and invalidate itIt must anticipate – have each and every element of a claim

Old 102a) – gets at novelty-things known/used by others-printed publications-patents

Old 102b) – gets at -printed publications-patents-public use-on sale

New 102 – categories have collapsedPrior art –

-printed publications-public use-on sale-otherwise available to public

Patents – these should be an easy case-published after 18 months-practice of prior art searching is done primarily on already existing patentsThe thing is, not all patent-like docs from other countries have similar characteristics

Reeves brothers v. US Laminating Corp. (EDNY 1966) – p. 424 – foreign “patent” thing with no novelty search IS a patent for prior art purposes, only for what it discloses and claims, though.2 questions:

1. What constitutes a patent?Here: German “Gebrauchsmuster”, if application matches form and content requirements, is issued without any novelty search; notice issued in German patent gazette, but it is never actually printedUS court holds that this IS a patent for prior art purposes, but only for what is in claims.

2. what part of the patent qualifies as prior art?Answer: US – entire patent. Foreign patents – only the claims.

Known or used by others must be PUBLICLY known or used (even if it’s just a little bit public).

2 issues unique to old 102102e) – another category of prior art – largely superceded by new 102’s stipulation that first filer wins

-prior-filed applications-created secret prior art – if app hasn’t yet been published, then competing applicant can’t know about itPatent examiners cannot review other examiners’ applications, so it’s tough to head off two competing applications early, especially if they’re in different art units. (this problem is solved by new 102 – first to file wins.)

102g) – date of invention and priority102g1) interference – two pending apps that claim the same thing – examiners must determine who invented first.102g2) – same rule w/ respect to prior art – applies generallyLast paragraph – must consider both dates of invention/conception, but diligence.

Brown v. Barbacid, p 451Each claiming the same assay – comes down to diligence, etcConception reduction to practice filingConception – formation in the mind of an inventor of a definite and permanent idea of the complete and operative invention

-must meet all elements of claim-must be enabling

Diligence – substantially continuous conduct from just before opponent’s date of conception or RTP- if delay is commercially motivated, rather than due to circumstances beyond your control, then it

probably won’t support diligenceRTP – making a working model of invention OR filing a patent app that enables every element of the

inventionGenerally – is RTP if it is close enough to actual working conditions

102g) – first inventor may still not win priority fight if concealed, abandoned, suppressed the invention (deliberate concealment)

Peeler v. Miller (p. 465) - can only wait so long to file before invention is considered suppressed.

PTO rule 131 – allows swearing behind prior art (this is gone, in the new patent act)

PUBLIC USE

Egbert v. Lippmann (US 1881) – p. 530 – use of corset steels in corset worn in public counted as a public use, even if nobody could see the steels or knew they were there; there was no degree of control exercised over the steels by the inventor at that time.invention is a type of corset steel. Potential public uses here: inventor made corset containing new steels, gave it to woman who wore it around in public – no restrictions placed on use, could have sold, shown to anybodyCourt holds that this is a sufficient public use to bar patenting, even though the invention was not visible to the public. Court says that he could have created an understanding of secrecy, or an actual signed agreement, or better note-taking on the characteristics/use so as to establish an experimental use defense (if you haven’t relinquished complete control, this could excuse the use)Two aspects of “public” – number of persons – court says that use by one person is enough

-hidden vs. apparent use – steels weren’t out in the open (compare this with the Rosair (sp?) case – use was out in the open for anybody to see, even though nobody was in this oil field in Texas)public use really just means “use” here – but, “known or used by others”, we’ve added “public” – a little irony! Hooray for ironyMaybe this case comes out differently if the two people are marriedNext class: rubik’s cube!

10/27/11

Moleculon Research Corp. v. CBS (CAFC 1986) - p. 536- showing model to friends/boss is NOT a public use; inventor did not relinquish control.Showing rubik’s cube to his friends/boss is NOT a public use – he retained complete control, it was non-commercial.Major factor is “actually relinquishing control of device” – he doesn’t do thisHe could have tried an “experimental use” defense

Does the number of people who have limited access to the invention matter for this analysis? Probably not – look at Beachcomber case, person who let 30 friends try out kaleidoscope, this was deemed a public use. Think about showing it to one person and asking for feedback, and showing it to 30 people at a party.Selling rights to something does not create an on-sale bar – this is the sale of rights, not the sale of the invention.

Metallizing Engineering v. Kenyon Bearing & Auto Parts Co. (2nd cir 1946) – p. 541 - selling a product for over a year before trying to patent the process to make that product is a public use bar, even though the product is secret.Method for conditioning metal surfaces - He kept the process secret, but sold the product of the process – if this were not an on-sale bar, it would allow him to extend the life of the patent. This is despite the fact that nobody else knows the process (i.e. there is no public reliance interest involved).Interesting thing – your secret use can bar your getting a patent, but another inventor can come in and get one – this is an incentive to file early

Why not just create an absolute bar of 1 year?-give inventors time to perfect invention-letting inventor control when he releases invention-proving the date of invention is really hard

ON-SALE BARA lot of the formalities associated with the contract view of what is “on-sale” has gone away – even if there is no physical embodiment, and an offer to buy is sufficientUS solicited bids for building something, company put in bid, never built product, but this was still an on-sale bar – lack of physical embodiment didn’t matter, b/c issue was whether they were expanding the patent term. Solicitation of order was attempt to commercialize, so inventor was obtaining a benefit

Pfaff v. Wells Electronics (US 1998) – p. 544 – for something to be offered for sale, there must be two conditions – a commercial offer for sale, and an invention that is ready for patenting.November 1980 – Pfaff begins work on socket.Prior to march 17, 1981, Pfaff shows sketch of concept to representatives of TIApril 8, 1981, they provided Pfaff with written confirmation of previously placed oral purchaseSummer 1981 – reduction to practiceJuly 1981 – fills TI’s orderApril 19, 1982 – patent application filed by Pfaff.critical date – April 19, 1981Pfaff holds – there are two elements required for an element to be on sale-1. commercial offer for sale

-only need an offer, not an actual sale-can be a general offer to the public-offer can be rejected-can even be illegal to make the sale-can be a bar even if purchaser doesn’t know what he is buying-can have marketing, as long as marketing doesn’t rise to level of an offer

Here – the offer, according to the court, was on April 8, 1981 – TI puts in orderAdvertising could be offer – if there is price, means of accepting an offer-2. invention that is ready for patenting

-actual or constructive RTP-early offers can trigger on-sale bar even before the product is “done”.Question comes down to – how detailed is the sketch?Pfaff treats conception as the keystone of invention

the specific product must be on sale-on sale bar is triggered even if neither buyer nor the seller know what they have

Abbott Labs v. Geneva Pharmaceuticals (CAFC 1999) – p. 558 – There was an on-sale bar, even though the exact identity of the product was not known.“Even though the parties did not know it at the time, it is undisputed that Form IV was the subject matter of at least three commercial sales in the US before the critical date”

Abbot argues that parties “must conceive of what they are selling”. Court says – nope. Don’t want to withdraw inventions that are in the public domain.

Inherent on-sale bar?Pro – would raise price of products in public domainNo incentive to find out what something is, if you can just keep selling itDon’t need a further incentive to product the product, since you’re already inventing itCon – inventor didn’t sleep on his rights, here, he just didn’t know he had somethingReducing incentives to do research on newly-discovered compound

EXPERIMENTAL USE EXCEPTION

City of Elizabeth v. American Nicholson Pavement (US 1877) - p. 562 – Wooden pavement’s use on a public street for 6 years was experimental use, because such pavement had to be tested in public, and inventor was constantly investigating how well it was working.Inventor was engaged in good faith in testing the invention’s operation. Want invention to be perfected-better disclosure, better products – if it takes a few years of experimentation, but produces better products/disclosure, this is a good tradeoff-Allows inventors to self-select what inventions they file

Distinguish this from the corset case – in corset case, inventor didn’t do much follow up on productsHere, we have lots of evidence of the inventor’s intent (lab notebooks, interview notes)

What constitutes bad-faith experimentation? Factors (consider in concert with Lough)City of Elizabeth Lough

1. Extensiveness 75 feet of road 6 prototypes2. Inventor’s activity Records, notes, etc. None3. Scope of activity Okay nothing4. Confidentiality n/a No confidentiality5. Control Retained Lost

Also – experimental activity does not extend to testing marketability

Lough v. Brunswick Corp. (CAFC 1996) – p. 569 – creation of 6 prototypes of seal assembly, and not maintaining strict control/learning from the use what the problems did not constitute an experimental use exceptionIndividual inventor creates 6 prototypes of a seal assembly for a boatHeld – this was not experimental useDissent – suggests that standard should be different for small inventors

Absolute v. relative noveltyAN-so long as invention is not new, cannot get a patentRN-you might not be the first inventor, but b/c the first inventor held back the invention in some way, we’re not going to invalidate your patent

Baxter Int’l v. Cobe Laboratories (CAFC 1996) – p. 577 – An existing product may act as prior art even if its inventor did not recognize it as such.Invention is a centrifuge for separating whole blood into its components. Before critical date – team at NIH, unrelated to inventor, designs/uses a similar centrifugeThis is not prior art under 102a or 102g – NIH centrifuge was invented AFTER patentholderQuestion – did Cullen file his patent app too late (i.e. was the NIH centrifuge in use before the critical date)?

How is this different than Egbert?Here, the public could see invention; in Egbert, they couldn’tHere, 3rd party using it; in Egbert, it was (kind of) the inventor using it

This is less public than Egbert

Does it make sense to allow a 3rd party’s experimentation to justify the filer’s delay?Yes – invention isn’t reduced to practice until experimentation is over

p. 579 – policies underlying the public use bar1. also doesn’t really apply2.3.4. doesn’t really apply

Gore v. Garlock (CAFC 1983) – P. 586 - Secret but commercial use of process to make a sold product creates 102b prior art if the INVENTOR does it, but NOT if a 3rd party does it.Invention is process for stretching Teflon into fabric

Public use bars:Applicant (commercial exploitation

3rd party

Public (reliance interest) Egbert (barred) Baxter (barred)Abbott (barred)

Secret Metallizing Engineering (barred) Gore (NOT barred – no reliance interest OR commercial exploitation by applicant)

Policies that are in play with respect to each category:When applicant is making the use: commercial exploitationwhen use is not by applicant, this reasoning doesn’t applySo, when use is by 3rd party, in public use: public reliance interest3rd party secret uses – this rationale also disappears(this is largely judge-made law)Ultimately, the key policy goal in Gore – create incentive for early filing in 2 ways – 1. Patents are denied if they elect trade secrets (metalizing) 2. Others can get patent if you keep your method secret (Gore)

Even if process is being kept secret, but inventor is selling product of process, it’s still a public use of the process b/c inventor is benefitting (product is a non-informing product) (metalizing engineering)

3 statutory remainders under old 102(c) he has abandoned the inventionCould argue that in Egbert, he waited so long that he constructively abandoned it3 circumstances when abandonment still matters

-behavior that occurs within 1 year of application-abandonment without any publication, public use, or sale-abandonment by implication in a lapsed patent application

(d) prior foreign filing – barred if foreign patent issues on same invention before US app is filed, and if foreign patent is based on application filed more than 1 year before US patent app

(f) did not himself invent the subject matter sought to be patented (derivation)-this still exists in new 102; one of few exceptions to first to file

Campbell v. Spectrum Automation (6th cir 1975) – p. 441 – “Clear and convincing evidence” is required to demonstrate the invalidity of a patent. (patents have presumption of validity, so preponderance wouldn’t make sense)Dispute over inventorship - Zimmerman says – I thought of the key innovation, by talking to my dad and looking at his belt buckle. Campbell says – I gave directions to Zimmerman about how to create this machine, and he went and made it. Zimmerman introduces the belt and a picture of his dad – court believes himClear and convincing evidence standard (this is the standard to invalidate the patent) - Case turned on a credibility determination – decided who is lying

Novelty under NEW 102 (see handout)2 sections –

a) content and b) exceptions

102a1) patents, printed pubs, public use, on sale, otherwise available to the public[exceptions: 102b1): A) disclosure from applicant B)disclosures by others made after “public” disclosure by applicant.]102a2) earlier filed US patent application filed by another[exceptions: 102b2): A) first filer derived invention from 2nd filer, B) 1st filer filed after public disclosure by applicant/2nd filer C) common assignee]A exceptions – disclosures by applicantB exceptions – disclosures by others

11/3/11 – OBVIOUSNESS - Invention is effectively covered by multiple inventions, not just one (or by just one invention, modified by what a PHOSITA would have known to do)Under what circumstances can you assume that an inventor would take all the pieces and put them together?

What is rationale?-Gets at technical innovativeness, not commercial innovativeness; it is possible that a tiny improvement

could make something marketable-Don’t want to encourage trivial stuff-Commercial novelty – market should produce enough incentives

Ex: Selden patent - attaching combustion engine to car chassis – patent wasn’t necessary to bring out the invention (“inducement standard” – if invention is obvious, inducement of a patent is not necessary; would be invented anyway)

Hotchkiss v. Greenwood (US 1851) – p. 625 – The mere substitution of one material for another does not make a non-obvious invention. – obviousness is defined by ingenuity or skill possessed by an ordinary mechanic acquainted with the business

Invention is a doorknob made of clay and porcelain – cavity is filled by metal to make a screwPrior art – 1. doorknobs made of clay 2. doorknobs made of metal, with a screw mechanism

Held - obvious to take the design of the metal doorknob, with the screw, and apply it to the clay doorknob?PHOSITA is objective, not clear that this standard is, however

After Hotchkiss – court struggled with this – how do you determine that an invention is inventive enough?First set of cases – dealt with how the invention occurred (like Atlantic works v. Brady) – if inventor used trial and error, this is obviousCuno Engineering v. automatic – “flash of creative genius” – very high standard (expressly overruled by last sentence of first paragraph of 103a)

Makes granting patents very arbitrary – also discourages innovation – Eureka moments require no investment, trial and error does.Rules of thumb developed –

simultaneity of invention means that it was obviousChanges in material were obviousCombination patents were held to be a different class of inventions – generally considered obvious

SECONDARY CONSIDERATIONS – indications of performance in the market that infer something about how innovative it is

-Commercial success – probably would have been invented sooner but for its non-obviousness-Acquiescence – if competitors didn’t rise up and challenge the patent, meaning they thought it was valid,

courts would defer to this-Long-felt need – if a problem defied solution for a long time, even though it was of public interest,

solution must have been non-obviousOthers tried but failed – if inventor could show he was, say, 20th to try something, and everybody else failed, court could infer that it was non-obviousCongress enacted 103 because these rules created a giant clusterfuck

Graham v. John Deere (USPQ 1966) - p. 638- based on the factors of scope/content of prior art, the differences between the prior art and the patent at issue, and the level of ordinary skill in the prior art, it was obvious to make the improvement present in the patent at issue compared to the prior art.Changing position of plow shank and hinge plate to allow for greater flexing of plow shank when plow chisel hits a rock (see page 650 for pic, or powerpoints)Factual inquiry – 3 things to examine

-Scope/content of prior art-Differences between prior art and patent at issue-Level of ordinary skill of the prior art

Based on these facts, ask if a PHOSITA could have made the leap from prior art to the invention – mixed question of law and fact – judgment call.Danger of hindsight bias – easy to take what you have and say “sure, this makes sense, they could have figured it out”Once you figure out prior art, differences, and level of skill, THEN what?

First test: Teaching, suggestion, and motivations test (TSM) – articulated by CAFC in early 80s, then followed until 2007 when SC decided KSR

In re Dembiczak (CAFC 1999) – printout – TSM test was the proper test to determine if a PHOSITA would combine references, making something obvious.jack-o-lantern looking trash bags for leaves3 part test, according to graham:1. prior art

– handbook showing how to make a crepe paper jack o lantern- paper bag pumpkin- trash bags

2. difference between invention and prior artConventional bags – painting on facial features/orange colorChildren book – medium (paper mache or paper bag to trash bag)

3. level of skill

CAFC says – not obvious – there was no TSM to combine the two prior art references-is trying to prevent obviousness by hindsight bias-does the TSM test solve the hindsight bias problem?

Court suggests that you solve hindsight bias by pointing to actual evidence of something that existed at the time of invention (evidentiary rule) – no longer subjective if you can point to something specific and concrete

Whether a person would combine references depends on how analogous the prior art references wereWould a leaf bag designer be aware of the children books?

Not within his own field, no, but maybe just in the world, he would be aware of it

How creative is a PHOSITA? Can they extrapolate to/from other fields? Market incentive to do so?

PHOSITA is not supposed to be particularly creative, they are supposed to put a boundary on knowledge – court doesn’t want to make determination on how much knowledge everybody in the world has

The TSM test becomes problematic when the CAFC said that it was the exclusive test for obviousness; this eventually led to KSR

KSR International v. Teleflex (US 2007) – p. 673 – TSM test is helpful, but not the only test for determining obviousness. Question isn’t whether something was obvious to the patentee, but to the PHOSITA. Showing that a combination was “obvious to try” may establish something as obvious. (tons of reasoning in this case)Question – is TSM test the exclusive test for determining non-obviousness? Answer: NoCAFC started issuing opinions saying that it wasn’t, but it was the most importantTeleflex sued KSR for infringement of Engelgau patent (Teleflex was sole licensee of Engelgau)Engelgau was solution to problem of combining adjustable gas pedal with a sensor

Prior art:Most important is the Asano patent – just the adjustable pedalSmith patent – pedal w/ electronic sensorTeleflex says: b/c Asano says nothing about solving sensor problem, a PHOSITA wouldn’t look at it

Court says: not so. PHOSITA could look beyond the problem – would be aware of art in his field, and draw on it, in an objective way

Hard part: what do you replace the TSM test with?

Question: does invention have sufficient inventive step to warrant a patent (regardless of whether or not it is a combination)However, if invention is a clear combo, makes analysis easierThis is quite literally bolting two inventions together - Compare to US v. Adams – nobody believed combination of water and battery would work – even though he just switched kinds of parts, prior art taught that it would be dangerous and wouldn’t work. Unpredictability made it non-obvious

Certain fields are more predictable than others – biological and chemical are less predictable, mechanical parts are more predictableSo, if predictability is the key, easier to get patents in biology and chemistryPHOSITA is person not only of ordinary skill, but ordinary creativity

-You don’t need the prior art to connect all the dots – can rely to some extent on creativity of PHOSITA – can assume some degree of creativity-Test for obviousness is objective – doesn’t depend on what inventor was trying to accomplish, but on what was accomplished by the claims

Two other factors1. market demand – way to show the “motivation” – exogenous technological developments can provide

incentive to create new inventions that are nonetheless obvious2. obvious to try – CAFC had rejected this as a basis for obviousness, and SC rejects this right back

Does this approach make it easier or harder to get a patent? Harder.

Question: false positives vs. false negatives – do you want more invalid patents that issue (lax test), or more patents that should issue, but don’t (strict test)False positives get info out to the world, but also generate patent thicketsFalse negatives de-incentivize followup innovations

TSM is not dead: holding of KSR, stated narrowly, is that TSM is not the exclusive test for non-obviousness, but see p. 683 – TSM is not exclusive test, but is helpful sometimes, as long as it is not applied rigidly

In re Kubin (CAFC 2009) – p. 693 – Obvious because there was little further experimentation that needed to be done to go from the prior art to the present claimed invention.Not obvious how you generate a chemical from another chemical – rejects the “obvious to try” test.claims to cDNA encoding human NAIL proteinPrior art: 1. disclosure of protein2. method to isolate gene sequence that codes for the protein

Argument (winner) – combine these two, you get the DNA sequence.Two situations where “obvious to try” is NOT the same as “obviousness” (see p 696).

1. obvious to vary all parameters or try each of numerous possible choices until one possibly arrived at a successful result, where the prior art didn’t indicate what parameters were critical, or any direction as to what choices were likely to be successful.

2. obvious to explore a new technology or general approach that seemed to be a promising field, where the prior art gave only general guidance as to the experimentation to be performed.

Obviousness is appropriate to find when the prior art “contained detailed enabling methodology for practicing the claimed invention, a suggestion to modify the prior art to practice the claimed invention, and evidence suggesting that it would be successful.’ You just need a “reasonable expectation of success”, not guaranteed success. (p 697)Rules VS Standard: OTT is standard (more subjective, more flexible), TSM is rule (more objective, less flexible – CAFC is split as to what it prefers)

In predictable fields – easier to find TSM in the prior art.Arkie Lures, Inc. v. Gene Larew Tackle (CAFC 1997) – p. 706 – References that teach away from the invention help make it non-obvious.According to Graham v John Deere, 4 kinds of factual inquiries are made in determining obviousness:

1. scope/content of prior art2. differences between prior art/claimed invention3. level of ordinary skill in the field of invention4. objective indicia such as commercial success, long felt need, and copying.

Majority says that beliefs of the field were that making such a salt/plastic combo was difficult. – “concern for the quality of the product, the warnings, and the perceived manufacturing difficulties.”Dissent – the references don’t completely teach away. This is the problem with a “teaching away” factor, and putting so much weight into it: there is a difference between “you can do it, but it would be crappy” vs. “can’t do it, period.”Teaching away can be inferred (TSM judges would prefer it be express, though)11/15/11 – absent, get notes

NONOBVIOUSNESS- Tool kito TSM test (still somewhat relied upon by Fed. Cir.), obvious to try coupled with reasonable expectation of success,

group of secondary factors, KSR free-floating inquiry- Some sections of 102 easily carry over to 103o 102(a)

o 102(e) (Hazeltine)

- Now problem of 102(b)o Effective date of the reference is different than in 103

In re Foster (CCPA 1965) – p. 768 - An inventor may lose the right to patent his invention if the patent application is filed more than one year after a publication within the meaning of § 102(b) renders the invention obvious. An invention may become obvious due to a printed publication.

- Foster invents synthetic rubber compound: Dec. 26, 1952- Binder publishes article in Aug. 1954o Does not anticipate everything Foster has done

- Aug. 21, 1956 Foster files patent application- Question is: can this operate to combine with other things for bar under 103?o 102(b) materials can be used to invalidate a patent even if they do not entirely anticipate a patent

- How is this?o Policy under 102(b)

Don’t want patent to issue on something the public believes to be in the public domaino Policy under 103

Anything that a PHOSITA could have done a year before publication should remain in the public domaino 102 terms

If all elements rule applied to 102(b) as it does under 102(a) it would be easy to sleep on your rights; so extend 102(b) to obvious advances as well

- So this is not really interpreting 103 but rather 102(b): 102(b) art does not have to meet the all-elements ruleo So rejection on this ground is really 102(b)/103 rejection

- 102(e) and (g) are out in new statute; 103 is amended to now say “…would have been obvious before the effective filing date of the claimed invention…” bringing 102 and 103 in sync [this takes effect in 2016]

Next question is about what fields these references can be drawn3. NON-ANALAGOUS ARTS LIMITATION

In re Clay (CAFC 1992) – p. 780 - Only prior art from an analogous field of work may support a finding of obviousness

- Invention is process for storing refined hydrocarbon fuels in a tank. Two pieces of prior art Hetherington: addresses issue of displacing dead space liquid using impervious

bladders formed with flexible membranes Sydansk: addresses use of gels to increase production in oil fields

- Court says this patent is valido PHOSITA would only be expected to look at inventions in the same field or solving the same problem

o Sydansk is in a different field (oil drilling field)

- Two questions: (1) is the reference in the field? If so, PHOSITA is presumed to know it(2) is it reasonably pertinent to the particular problem which a patent attempts to solveINFRINGEMENTCourt, not jury, construes patent claims. Jury decides if there is literal infringement

Claim construction “is completely indeterminate” – many words in claims are subject to interpretation, in different ways – conflicts are inevitable – claim construction becomes expensive part of patent litigation

For test – know what tools to use to argue for either side of an interpretation

Intrinsic evidence Extrinsic evidenceClaims themselvesSpecification (including drawings, etc)

Dictionaries, treatises, articles, etcExpert testimony (created for litigation/at time of

Prosecution history -prior art cited

litigation)Prior art not cited

Intrinsic – Ex – “body” of syringe could mean one part or multiple parts – spec only talked about one part – dissenting judges said spec was irrelevant, but majority said that spec made it so ‘body’ had to be one partProsecution history: difference between way it is used here and in doctrine of equivalents-used when patentee estopps himself from claiming something given up during prosecution (?)Question – is a concession as to the interpretation of a term usable to define term after the patent issues?We do have to be careful to use prosecution history not to limit the claims, but to interpret the claimsExtrinsic – Dictionaries, treatises, etc., is subject of most debateTexas Digital - Panel suggested that these sources were the most important source – if there is more than one dictionary def, then turn to the intrinsic evidence to determine which is the right onePros and cons of this approach:Pros:

Dictionaries are unbiasedCons:

Words have different meanings in different fields of art – this is supposed to be a contextual inquiryWhat dictionary do you use? CAFC has relied on 24 different dictionaries since TX Digital

CAFC, in Phillips, says: Dictionaries are useful, sure, but not the exclusive source of the first cut at claim structure – takes too much away from context of the patentIntrinsic evidence becomes more important in PhillipsDo we want to determine meaning by PHOSITA or by what the patentee intended?

Expert testimony – OK to rely on outside experts to establish meaningPro: as close to a PHOSITA as we can get without talking to the patenteeCon: experts are biased, they are paid by one party, they’re not exactly PHOSITAS

Not available to the public at the time of patenting

Prior art, not cited – more objective than testimony, maybe more indicative of what PHOSITA would have thought

Distinction between extrinsic and intrinsic – Intrinsic – lets you go by exactly what patentee intendedExtrinsic – more consistency across patents(?)

Phillips. v. AWH Corp. (CAFC 2005) – p. 805 – in claim construction - claims themselves are the most important, then spec, then prosec history, then all extrinsic evidence is lumped together, to be used if there is still ambiguity after consulting the first three sources.(not all panels follow this – SC may need to get involved)Intrinsic evidence becomes the most important

Invention – modular steel-shell panels, for use in building prison walls (can take a bullet hit) – have interlocking structures (baffles) at internal angles that cause bullet to bounce around within wall rather than go straight throughClaim language – “…comprising internal steel baffles extending inwardly from the steel shell walls.”So, these baffles are steel, interior, and extending inwardly.What 2 pieces of evidence does the D rely on?

If baffles are meant to deflect bullets, they must be at non-90 degree anglesCounter – another independent claim says that baffles are put at specific angles to deflect

– if this were an inherent quality of baffles, this independent claim would be redundant(see p. 814 – indep claim 17 says that baffles are set up in way that deflects projectiles – if baffles always did this, claim 17 would be superfluous. Dep claim 6 says that baffles interlock at angles performing deflector function – if baffles always did this, this would also be superfluous.)Spec lists a bunch of functions, not just deflecting bullets – court says that functions are non-cumulative, claims can meet one or more of functions, but don’t have to meet all.

(SEE PAGE 821 FOR CLAIM CONSTRUCTION CANONS)1. Narrow construction to save validity – when two interpretations are plausible, choose the one that

preserves the validity of the patent (the narrower one)2. ordinary v. contextual meaning – often not a widely accepted definition, and terms may be used

idiosyncratically, so you have to use the contextual meaning.3. contextual meaning may trump ordinary meaning4. patentees can act as their own lexicographers.5. patentees statements in the prosec history or the spec can limit/disclaim apparently broad claim language6. claim differentiation can be used to clarify meanings (“anti-redundancy canon”)

1st – patent is construed from PHOSITA’s POV at time of filing2nd – can look to spec or prosec history only to understand or interpret, not to bury/limit terms of claim3rd – contextual meaning trumps ordinary meaning4th. Lexicographer – patentee is free to define terms5th. Patentee can expressly choose to disclaim certain meaningsClaims are interpreted to preserve validity (Phillips court limits this severely, but later courts still say it is somewhat important)Claims often interpreted to read on patentee’s preferred embodiment(something about Narrow claims)

Markman v. Westview Instruments (US 1996) – p. 853 - The scope of a disputed claim is a matter of law, and therefore is to be decided by a judge.Narrow holding of Markman - Although infringement requires jury trial, claim construction need not be tried by a juryJudge: -certain judges hear lots of patent cases -juries may be swayed by charismatic expertsJury: -this is kind of “fact-y” – involves weighing of evidenceOld way – general verdict – jury just says “yes/no it does/doesn’t infringe” without explaining construction – this seems bad, tougher for public notice to other potential infringersOr specific verdicts

DOCTRINE OF EQUIVALENTS -basically non-literal infringementHistory: traced to Winans v. Denmead (p. 866) – large circular container vs. large octagonal container – “substantially embodies inventor’s mode of” something, was very close – decided that patentee should get benefit of doctrine of equivalents – prevents people from making very small, insubstantial changes to avoid patent

If you were to always read the claims literally, it would be too easy to avoid infringement.

Triple identity test: (p. 869) (from Gray v. James, CCD PA 1817)Identical functionSubstantially the same wayTo achieve substantially the same result

Essentially – looking for interchangeability

What is role of claims in a peripheral claiming system? –define boundaries of claimsDoE allows patentee to get benefit of more than they claim – this creates a lot of uncertainty – notice function is crippled

Can’t capture ground under DoE that you couldn’t have captured in original application because of prior artTest – put together claim that would encompass alleged infringing invention – if it is not blocked by prior art, then it infringes.Prosecution history estoppel is biggest test :

Warner-Jenkinson v. Hilton Davis Chemical Co. (US 1997) – printout - Triple identity test is helpful, but is not the only method for finding a DOE violation; must look at each element. DOE must be applied to each element.The prosecution history of a patent affects the enforcement of its claims through the doctrine of equivalents. Where the PTO has limited the scope of an amended claim for a clear reason, then the patentee may not use the doctrine of equivalents to enlarge the scope of the claim. Where the PTO has not provided a clear reason for the limits of an amended claim, the patentee bears the burden of supplying a reason that comports with its interpretation of the claim.during prosecution, they added a restriction that the pH level was to be between 6.0 and 9.0Under 9.0 – added to avoid prior art Over 6.0 – no clear reason why they added it.Infringer’s product uses pH of 5.0Patentee says – this is effectively the same, we didn’t add the 6.0 limit to get around prior artInfringer says – this is different by a factor of 10, you can’t suddenly reclaim itCourt establishes limitations on DoE:All-elements rule – nobody really knows what an element is – can be any limitation in the claim language (can be a series of limitations) – 6.0 pH is counted as an element

For a long time, prevailing standard was the triple identity test. At Warner Jenkinson – court began imposing some limits on doctrine of equivalents

Court decides to make a presumption – anything given up is because of patentability. Burden is on patentee, then, to put forth reasons why the matter wasn’t given up for patentability reasons.

One limitation that court set forth in WJ was the “all elements rule”-don’t look at claim/invention as a whole – must go element by element what is an element? Not sure. Go by context.Definition of equivalence –

WJ court says that triple identity test is helpful, but can’t be the exclusive testAll that matters is that the analysis follows the all elements ruleThey look at substantiality from the eyes of the PHOSITAPioneering patents – tend to get a broader range of equivalents than improvements in a crowded field, because

-more socially valuable to incentivize big innovative leaps (even though this broadly-interpreted claim can prevent improvements in this field)

-new field – alternatives are less clear, not fair to punish inventors for alternatives they couldn’t have understood

Also – alternatives are set at the time of filing – if new equivalents are created after filing, they are not countedNot limited to equivalents disclosed in the patentsObjective standard (no concern for the mental state of the accused infringer)

Prosecution history estoppel – if you give up matter during prosecution, you shouldn’t be able to reclaim it via the doctrine of equivalents

What about placing the burden on the patentee?For: ? Against – evidentiary problem. How do you prove a negative?

Now, patentees are on notice that they should provide reasoning for making amendments

Festo v. Shoketsu (US 2002) – p. 871 - If there is no literal infringement, there can be no doctrine of equivalents infringement, if prosecution history estoppel applies. Also: Not entire range of equivalents are barred by PHE – however, patentee bears burden of proving that a surrender of certain subject matter does not include a specific equivalent

First holding:Piston used as part of assembly2 limitations added during prosecution, because of 112 grounds - Sealing rings (pair)Outer shell had to be made of magnetized materialOther invention – instead of 2 rings, had single ring with double-sealing lip. Also had non-magnetized material

SC says – basically affirms CAFC – an amendment due to any patentability requirement gives rise to prosecution history estoppel (not just limitations to get around prior art)Practically – more or less any amendment gives rise to PHE. This is because you are basically conceding you can’t get a patent without this amendment, whether it was due to 112 or 102.

Even voluntary amendments unrelated to an examiner’s rejection still trigger PHE – patentee knows what he is doing. Can actually surrender subject matter by argument alone if the argument is clear as to exactly what you are surrendering.

Second holding: Not entire range of equivalents are barred by PHE – however, patentee bears burden of proving that a surrender of certain subject matter does not include a specific equivalent

Hypo: Wright Bros take out patent on airplaneOne claim on wing – 1. wing made of fiberThen narrow it to: 2. wing made of cotton

Infringing device – wings made of synthetic fibersIdea – if synthetic fibers were unforeseeable at the time that the claim was limited, then the synthetic fiber wing can still be equivalents – doesn’t necessarily take synthetic fibers out of the scope of the claimNote: unforeseeable means more than simply “does not exist yet”Also: if device is given up for reasons not before the court

Johnson & Johnston Associates v. R.E. Service Co (Fed Cir 2002) – printout – Dedication rule - when patentee discloses subject matter but fails to claim it, she is “dedicating” it to the public domain.Invention is assembly that prevents most damage during manual handing of printed circuit boardsUses really thin piece of copper foil – puts copper foil onto a thicker substrate

Spec discloses a bunch of different metals you could use for substrate, but claims only mention aluminum. Accused invention used steelHolding – there is no infringement under doctrine of equivalents, because when patentee discloses subject matter but fails to claim it, she is “dedicating” it to the public domain – “Dedication rule”. Public relies on claims to establish the inventionAlso – wrong to the PTO to disclose but not claim, and then try to claim it later – they didn’t have a chance to examine the non-claimed subject matter.

Court says – this is why we have Reissue patents – within 2 years, can issue broadened patent. Also CONs

Problem with the dedication rule– discourages full and complete disclosures – you may not want to disclose everything if it may result in not being able to use it as an equivalent

Rader’s CONC - looking to reconcile notice function with protective function of DOE-says that DOE should not capture subject matter that patent drafter could have reasonably foreseen during prosecution and included in the claims, so that DOE would be limited to unforeseeable technologies-this would result in a battle of experts arguing about what was foreseeable.

Each type of claim-means plus function – 112 p 6 – 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. Form is “a means for doing X” where X is the function

Al-Site Corp. v. VSI Int’l (CAFC 1999) – printout – A structural equivalent in a means plus function claim under 112 p 6 must have been available at the time of issuance of the claim. An after-arising equivalent may only result in infringement due to the doctrine of equivalents, because the meanings of the claims are fixed at issuance and equivalent means cannot be added after the fact.Invention is a device for displaying glasses at eye doctor (or drugstore or whatever).2 versions of this device:Plastic piece with one loop hanging down that loops around bridgeSame deal but with 2 loops that loop around temples

First issue – how do you tell what is a means plus function claim?Presumption is that if claim says “means” it is a MPF claim – presumption can be overcome by showing that the claim discloses sufficient structure.

DC failed to instruct jury that they could find infringement for the presence of what was in the specification (rivet/button/hole structure) Maybe the jury found infringement under DOE, but they could have found literal infringement, which they would have done if they were instructed correctly.

Court here finds that the error didn’t matter (other times it could, though)

---As for timing – equivalent must have been available at the time of a claim’s issuance.Claims take on meaning as of that dateLiteral infringement is limited to meanings at the time the meaning was fixedAfter-arising technology counts only for DOE analysis, not for a means plus function analysis - equivalent

That said – the 2 are pretty similar. A finding of no literal infringement may lead to a finding of no DOE infringement.

Second difference – test for equivalenceMPF – are the differences in structure substantial?Additional requirement of identity of function

Here: DC omitted “or the equivalents thereof” from the jury instruction on DOECAFC says that this is harmless error – jury must have found equivalents for each function

PRODUCT BY PROCESS CLAIMSAbbott Laboratories v. Sandoz, Inc. (CAFC 2009) – p. 838 – Product by process language is a limitation/element that must be satisfied in order for infringement to exist. Producing the product by a different process is NOT infringing.

Product is described in 2 ways – X-ray diffraction pattern, and the process by which it is synthesized.D is claiming the same product, but produced through a different process; says that therefore it is not infringing on the process claims.They use the term “obtainable by” and not “obtained by” – this doesn’t make a difference in the final analysis, however.CAFC says that this is a limitation. Why?

-extraneous language – if you don’t read it as a limitation, what is it doing in the claim?-notice problem-drafter’s choice (similar to estoppel doctrine – you chose to draft this in a certain way)

Why is this type of claim used?-sometimes difficult to describe the product – the X-ray diffraction pattern turns out to be difficult to

use in litigation (it’s not the molecule that they’re trying to describe, it’s the crystal structure)

Implications of the ruling:-narrow patent, since it’s difficult to prove infringement-encouraging further R&D so that more info about the product is known, so that it can be described

more easily

TWO EXCEPTIONS TO INFRINGEMENT DOCTRINESREVERSE DOCTRINE OF EQUIVALENTS - used to shrink the scope of claims.Even if you literally infringe, you should not be found guilty of infringement for some reason, and we narrow the scope of the claims to achieve this.

Westinghouse v. Boyden Power Brake Co. (US 1898) – p. 888 – A device that infringes on a patent, but is a drastic improvement over it, may be held to not infringe because of the Reverse Doctrine of Equivalents.Same elements, but the new invention actually works. This is what is encouraged with the patent laws.

-want to encourage improvementsCounter – certain inventors are the first to a field (pioneers) – maybe pioneer didn’t do it as well as the

subsequent inventor, but it is still useful to incentivize people to be first at something, even if it takes subsequent invention to make something useful.

Scripps Clinic v. Genentech (CAFC 1991) – p. 896 – Reverse Doctrine of Equivalents may allow a technically infringing product not to infringe, if there is an enormous improvement over the patent.Scripps patented purified human VIII:C, which had to be made from human plasma, which carried risk of disease. Genentech created human VIII:C from recombinant DNA, which was cheaper and avoided the risk of disease. The court said that maybe Genentech should be allowed to use the reverse DOE because of the drastic superiority of their product.

It’s very difficult to draw the line of “how much better does the new product have to be for us to not leave the blocking patent/negotiation process in place?”. Consequently, the reverse doctrine of equivalents is very rarely used successfully.

EXPERIMENTAL USE

2 types: common law and statutoryCOMMON LAW

Historically, there was thought to be a common law exception for all research use – follow on tinkering, university use, etc. courts cut back on this drastically, leading up to Madey v. Duke.

Madey v. Duke (CAFC 2002) – p. 903 – you can make/use (but never sell) the patented invention without infringing for 3 purposes: amusement, idle curiosity (maybe some scientific research as long as the object of the invention is not research itself) and philosophical inquiry. (basically kills the exception)

Madey’s inventions were used in the FEL lab – Madey resigns from Duke, but Duke kept practicing his patented inventions in his lab.So, what precludes the experimental use exception?

-Any commercial activity at all.-Attenuated commercial activity (aka keeping with accused infringer’s legitimate business, which was making

the school look better/attracting researchers and students, education, good press, getting research grants, etc)-even completely non-commercial research furthers Duke’s legitimate business advances.

As a practical matter, the experimental use exception is dead after this case.

3 lenses to view this through:1. Universities lens

Old rule – universities could make free use of patented inventions b/c they weren’t competing for commercialization dollars. Basic research also creates lots of positive externalities.

Changed via Bayh-Dole act – allowed universities that got federal funding to patent inventions made with those dollars.

-argument – universities are becoming commercial entities-counter – this is still research.

2. research tools lens-patenting research tools gives rise to anticommons – prevents downstream research if tools are patented.Distinction to be drawn between experimenting on a patented product (to improve) (experimental use

exception applies here) and experimenting with a research tool (to make the intended use of this tool).Difference in markets between research tools and other inventions

-if you are using a research tool, there is a market for it – experimental use should be limited to encourage incentivization of research tools

-if you are experimenting on a patented product, you are trying to improve it

3. improvements lens-design arounds in patents only happen b/c of work that is infringing. How else will you be able to come up

with the improvement? (still significant line-drawing problems)

Mostly to avoid having to engage in line-drawing problems, court says that this kind of experimental use is out.

Even though the common law experimental use is out, Congress still did something:35 271(e)(1) (part of hatch-waxman act) - It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention (other than a new animal drug or

veterinary biological product (as those terms are used in the Federal Food, Drug, and Cosmetic Act and the Act of March 4, 1913) which is primarily manufactured using recombinant DNA, recombinant RNA, hybridoma technology, or other processes involving site specific genetic manipulation techniques) solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs or veterinary biological products.-basically – patent term of patented drug would be extended if generics couldn’t start research until the original patent expiresNow we allow research to begin before the patent expires, in exchange for increasing the patent term of drugs for the time they are in FDA approval

So: how far does this exception extend?Merck v. Integra (US 2005) - p. 907 – covers a wide variety of pre-sale activity, if that activity is related to federal regulatory process. Exception is to be construed broadly. Includes experiments on compounds that are not part of the 2 particular submissions to the FDA (reasonably related to development of info).

Different question: after a drug is marketed, companies often engage in further research to monitor its safety/efficacy (phase IV studies). Should these be included?

INDIRECT INFRINGEMENT (271(b) and (c))Accused helps somebody else to infringe.Contributory infringement and induced infringement.Why do we care about when somebody helps somebody else to infringe?-efficiency – if there is one contributory infringer selling to a bunch of direct infringers, much easier to sue the former than the latter. (see: all P2P lawsuits targeting the provider).

271(b) and (c): (b) Whoever actively induces infringement of a patent shall be liable as an infringer.(c) Whoever offers to sell or sells within the United States or imports into the United States a component of a patented machine, manufacture, combination, or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use, shall be liable as a contributory infringer.

CONTRIBUTORY INFRINGEMENT (271c)Aro Manufacturing v. Convertible Top Co. (US 1964) – p. 916 – Contributory infringement exists where a party knowingly distributes a product designed to repair a patented invention. Aro sold replacement part for patented convertible top, to be used on GM and Ford cars. GM always had license, Ford got one later. Aro never had a licenseLicense to buy = license to repair (patent exhaustion)Court holds that license includes a right of repair, but not a right of reconstruction. This goes beyond the scope of patent exhaustion – you are basically recreating the product.Owners of GM cars had patent – this was okOwners of Ford cars – no patent – direct infringement by car owners b/c there is no implied license to repair. Therefore, selling the replacement part may constitute contributory infringement.

FOUR PART INQUIRY FOR CONTRIBUTORY INFRINGEMENT1. is the fabric a component of the device? Yes.2. is it a meaningful/material part of the device? Yes.3. did Aro have actual knowledge? (“knowing the same….) contributory infringer must know that there was a patent on the product they are selling parts for.

A component manufacturer is generally not a direct competitor of the patentee. Constructive notice operates with a little less force here b/c they may not be aware of the patents.-weird that actual knowledge is requirement here, but independent invention is not a defense to direct infringement.4. are there substantial non-infringing uses? If no, then they probably intended to be a contributory infringer. If yes (say if they just produced a bolt of cloth that is used for many things) then maybe Aro did not intend to further the infringement of the patent.

C.R. Bard v. Advanced Cardiovascular Systems (CAFC 1990) – p. 923 - A party may contribute to the infringement of a method patent by producing a device that allows users to practice the patented method. Patent is for a method, so the direct infringers are doctorsDifficult to sue thousands of doctors performing this procedure – so, you sue the manufacturer of a related device that can be used to carry it out.If there is nothing else that can be done with a device except infringe, then we sort of impute the knowledge of infringement to the manufacturerCourt says – although you can use it to infringe, you can also use it in a manner that doesn’t infringe, so we’re not going to find contributory infringement (like the Sony Betamax copyright case – VCR)

INDUCED INFRINGEMENT – 271b)Global-Tech Applicances v. SEB (US 2011) – printout - while inducement of infringement of requires knowledge that the induced conduct itself infringes, that knowledge element can be met by a showing of "willful blindness." Also, under 271(b), the inducer must know that there is a patent that will be infringed.Sunbeam wanted Pentalpha to develop a fryer that stayed cool to the touch. Pentalpha went to HK and bought one made by SEB with no patent markings, and copied it. Pentalpha then had an attorney do a “right to use” study, but didn’t say that it copied the SEB fryer. Pentalpha went out of their way to avoid learning about the patent, so they are charged with “willful blindness”, which the SC holds satisfies the requirement of knowledge.

Inducement of Infringement: The alleged indirect infringer must have: [1] actual or constructive knowledge of the patent [2] specific intent to encourage another's infringement; (must intend to induce infringement

infringement, not just the action that happens to be infringement)[3] the alleged infringer's actions actually induced infringement acts; and [4] that he knew or should have known his actions would induce actual infringement

What about imputing the knowledge into 271c? -congress obviously meant these to be separate-inducement requires more affirmative action than contributory infringement, so we can lessen the knowledge requirement

Two part inquiry for Willful BlindnessD must subjectively believe a high probability that a fact exists, and D must take deliberate action to avoid learning that fact.

TERRITORIALITY OF INFRINGEMENTPower of US patent doesn’t extend beyond US borders (271a – “….within US or who import into US”)

Brown v. Duchesne (US 1856) – p. 931 – A patent does not prohibit a foreign national from practicing an invention (and if use in the US is fleeting, it might not be a great idea to enforce, for a few reasons).No patent infringement of foreign ship that very briefly stops in Boston. Patent law is ill-suited to target this ship, due to US-France treaty. Only advantage of the patented sail would be on the high seas, even if it is used in US.Good reason not to enforce – international relations mess. This is more appropriately framed as a foreign relations issue. It would also just be a big mess

Counter – makes it easy to get around US patent laws.

Traditional approach – construes the patent laws narrowly to avoid extraterritorial effects, even when the infringement falls within the letter of the statute.

Deep South Packing – exporting components of an infringing device, to be assembled overseas, was not infringement. (NO LONGER GOOD LAW)Congress responded to this with some statutes, most importantly 271(f)(1): (1) 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.

Microsoft Corp. v AT&T (US 2007) – p. 934 – Software is NOT a component until it is installed.Patent doesn’t protect code itself, it protects method of interpreting speechMS exports software in form of a golden master disk – this disk is copied to other disks, and those are then used to installSoftware is NOT a component unless it is installed.Justices view software as a very physical thing.Big takeaway – another presumption against extraterritoriality.

INJUNCTIONS (283 and 284)Patent Law’s remedial scheme - You can get an injunction (sec. 283) or damages (sec. 284)

Ebay v. MercExchange (US 2006) – p. 942 – A plaintiff seeking a permanent injunction must satisfy a four-factor test before a court may grant such relief. (1) irreparable injury, (2) remedies available at law are inadequate, (3) considering the balance of hardships, an injunction is warranted, and (4) the public interest would not be harmed by such an injunction.Lower court: ME was not practicing its invention, so it was barred from injunctive reliefCAFC: reversed – longstanding rule that injunctions will issue in case of patent infringement

SC: rejects both of these views – patent law is just like every other area of lawRationale – patents are treated like property in law – you can keep people off your land absolutely, you should be able to do the same for patents

Benefits of a more categorical approach (like CAFC approach on always issuing injunctions) – makes licensing more predictable, since parties will know what is at stake if they go to litigation

What distinctions might you want to draw? (from Kennedy opinion) – Patent holdup – so many different patents in one invention, injunction on one patent can hold up the

product – difficult to findAnecdotally, this is a problem – empirically, not much evidence

Patent trolls – entities that don’t practice the patents they own (non-practicing entity – NPE)Might something like compulsory licensing be more appropriate for NPEs, who can only get money by licensing?Problem: definition of NPE is pretty broad – includes universities – where do you draw the lineJust because you’re a NPE now doesn’t mean you’ll be an NPE in 5 yearsCourts would have trouble drawing this line, but a much easier time evaluating the four factors in each case

So: what do you during the pendency of a trial?Preliminary injunctions raise similar issues, but the analysis is slightly different.

Amazon.com v Barnesandnoble.com (CAFC 2001) – p. 956 – For a preliminary injunction, must show (1) likelihood of success on the merits, (2) irreparable harm, (3), balance of hardships favors granting the PI, and (4) the public interest would not be harmed by granting the PI. No preliminary injunction here because BN created a substantial question of validity [affecting criterion (1)]Invention – method of one-click checkoutBN puts forth evidence that there was a lack of novelty – 102g) prior art

Is it the same to ask whether D asserts an infringement/invalidity defense that the P cannot prove lacks substantial merit is the same as saying that P lacks likelihood of success on the merits?Key issue here is vulnerability – court says that BN has mounted a substantial challenge to the validity of the patent, which Amazon can’t show lacks substantial meritCourt says – can’t make decision about validity on 102g, but can deny PI on the grounds that the prior art is convincing enough that we should continue with the case

Kimberly-Clark v. First Wipe Baby Products (CAFC 2011) – printout -

Notice in Kimberly-Clark – D basically makes an obviousness argument (mixed question of law and fact – must establish factual predicates of case first, then court applies TSM test or whatever)Court says – your argument makes sense, even though you haven’t introduced evidence yet

So, what is wrong with this scheme? Particularly, what does judge Newman say?You’re not asking the likelihood of success question, you’re asking whether D has presented a question of invalidity (?)

Also, we’re doing exactly what the SC said not to do, in Ebay

Policy justifications for PIs:-Maintaining the status quo

Status quo: infringer is infringing, so to maintain the SQ would mean to NOT issue a PI, but whatever-Patents are assumed to be valid (also a justification for not loosening up the standard of likelihood of

success)

Summary: injunctive relief. Formerly patentees got injunctions immediately upon infringement finding; eBay loosened this restriction.When you file for a PI, you put up a bond to cover the damages caused by a wrongly-issued PI.

DAMAGES (Sec 284)the “reasonable royalty” is the floorDamages in excess of the reasonable royalty is usually calculated as lost profits

First thing to think about – when did the damager start infringingStart with lost profits – this is what most patentees try to get (more money – full compensation)

First requirement for a patentee trying to prove lost profits – must show that they were a market participant. There are no lost profits if the patentee is a NPE (they are usually restricted to reasonable royalties).LOST PROFITS

Rite-Hite v. Kelley (CAFC 1995) – p. 987 – Four factor lost profit analysis. Also, patentee was allowed to recover for lost sales on a product that was not actually covered by the infringed patent.Patented invention is a device for securing a vehicle to a loading dock during loading/unloadingRite-Hite is patentee – manufacture 2 kinds of devices – auto and manual. Patents at issue cover the manual device, but NOT the auto.Kelley infringes the patents, with a device that is automatic. Lower court awarded damages for lost profits for BOTH the auto and manual devices. CAFC affirms.2 parts to lost profit analysis

1. patentee must satisfy the but for test – reasonable probability – but for the infringement, it would have made the sales 4 factors:

Must show demand for the productMust show absence of non-infringing substitutes (if P is losing sales, must be losing sales to D, and

not to something that is not infringing) – maybe show a catalog. Consumer reaction to non-infringing product matters – is alternative product cheaper? (elasticity of demand – at what price do things become substitutes for one another)

Must show that patentee had capacity to meet demandMust show the amount of profit it would have made.

2. if patentee establishes these, then also must show that the infringement was a reasonably foreseeable cause of the lost profits (?)

Don’t get every related damage, even if it meets the but-for test – some damages are too indirectly related to the infringement (stock price drop, goodwill, etc)

Court says that Kelley’s infringement is a “but for” cause of the lost automatic sales, and the lost sales were reasonably foreseeable.-Reasonable royalties might be the same as lost profits where there are direct competitors – they usually don’t license to each other.

Price erosion – should sales at a lower price count as lost profits damages? YES – courts usually hold that price erosion counts (complication is that you probably would have made fewer sales at higher price – need to compare the elasticities of demand to figure out the effect of dropping the price)

You can only recover your losses, not the infringer’s profits – not a theory of unjust enrichment or restitution. You are just being compensated for what YOU lost.

REASONABLE ROYALTIESSet up a fake negotiation – do your best to set up the ex ante (i.e. with no infringement) situation and figure out what the license agreement would have looked like

How do you do this?

Lucent v. Gateway (CAFC 2009) – p. 966- Started by looking at other license agreements

3 most important factors:Patentee bears burden of coming forward with comparable agreementsHere:

Not enough info in agreementsWhere there was enough info, they weren’t comparable – some were for different sort (lump sum agreement

vs. running royalties) – proffering a lump sum agreement to support a running royalties award, or vice versaAlso, some were cross licensing – agree to license each other your patents – each party can hold up

the other, different dynamics involved.

Court says that there must be at least a reasonable basis for comparison

Must also consider the valuation of the patented feature – how much of a part of the sold product was the patented invention? If it was a small part of a large package, you would expect the royalties to be lower

Use of patented invention – how much is the thing used? (can be informed by ex post developments)

Another way: “entire market value rule” – court computes RR based on %age of total sales of the product, on the theory that the factor was so important that it formed vast majority of the basis for consumer demand, and therefore should inform the baseline.

Does RR calculation actually mimic the ex-ante negotiation scenario? It assumes the validity of the patent, so, no – licensing agreements take place in the shadow of the law. Most patents are uncertain until they are tested in court.

Also, this is a highly stylized analysis – the parties couldn’t reach terms, or there wouldn’t have been a lawsuit in the first place. The agreement will be on the patentee’s terms; usually results in a higher RR rate.

Is this justified? Maybe – the uncertainty is gone, which justifies the higher rate.

WILLFUL INFRINGEMENT3X damages – statute is silent on when. However, courts usually apply enhanced damages where infringement is willful. (triple damages are not MANDATED when there is willful infringement, however)Egregiousness of the D’s conduct decides whether infringement was willful.

In re Seagate Technology (CAFC 2007) – p. 1027 – objective recklessness is the new standard for willful infringement, with a two part test: 1. patentee must show by clear and convincing evidence that the infringer acted despite an objectively high likelihood that its actions infringed a valid patent. In making this threshold determination, the infringer's subjective state of mind is irrelevant (this is new) . 2. if the patentee can meet this threshold requirement, then the patentee must demonstrate that the objectively high risk was either known or should have been known to the infringer.Also: attorney client privilege applies to trial court attorney, but not to the attorney who provided the infringement analysis on which the prior, infringing activity was based.Seagate is sued for infringement by Convolve. Prior to suit, Seagate learned of the patent, and retained a lawyer who issued 3 opinions stating that the patents were invalid and Seagate didn’t infringe.

What does Willfulness mean? Prior to Seagate – “where…a potential infringer has actual notice of another’s patent rights, he has an affirmative duty to exercise due care to determine whther or not he is infringing…” (p 1029)

What does CAFC do here? They basically create a recklessness standard

Courts look at:Deliberate copying

(if you are trying to design around a patent, but guess wrong on the scope, that is NOT willful – good faith exemption)

Was there a good faith belief of invalidity or noninfringement?Was there willful indifference to the patent?

Once you cross the threshold – how much should the damages be increased by? Generally, the bigger the company, the more likely the court is to treble the damages

Second issue in Seagate – what do you do about the scope of the attorney/client privilege?In many cases, there is an “advice of counsel” defense

When an alleged infringer is accused of a willful infringement, usually will waive some part of that privilege, because they will be asked what their reliance on the counsel was. Can’t use this privilege as both a sword and a shield.

What about communications with TRIAL counsel? Scope of waiver doesn’t include trial counsel, this is still privileged. This requires a great need for privacy (unlike the earlier advice of counsel).

Enablement – you can describe a logical series of steps that can technically enable something, without providing enough data or details to demonstrate that you were in possession of the invention.