JOLT Digest

Federal Circuit invites en banc review of broadening reissue jurisprudence
By Jeffery Habenicht – Edited by Charlie Stiernberg

In re Staats, No. 2010-1443 (Fed. Cir. Mar. 5, 2012)
Slip opinion

The Federal Circuit reversed the Board of Patent Appeals and Interferences’ (“Board”) decision to reject Staats’s reissue application and remanded for further proceedings. The Board had rejected Staats’s continuing reissue application because it was filed outside of the two-year time limit imposed by 35 U.S.C. § 251 and was not sufficiently related to a previous broadening reissue application filed within the two-year limit. In re Staats, No. 2010-1443, slip op. at 5–6 (Fed. Cir. Mar. 5, 2012).

The Federal Circuit held that the Board’s decision was inconsistent with its predecessor court’s decision in In re Doll, which concluded the two-year time limit in § 251 only applied to the initial broadening reissue application — not to properly filed continuation applications. Id. at 9 (citing In re Doll, 419 F.2d 925 (C.C.P.A 1970)). The court rejected the PTO’s argument that Doll only applied if the continuation application was “related” to a reissue application filed within the two-year window. Id. The court stated that this type of test would be “unmanageable,” because, by definition, every claim must be different in scope than the other claims. Id. at 10. In so holding, the court relied almost exclusively on Doll. The court concluded that if the PTO wanted to overrule Doll it would have to petition for a rehearing en banc. Id. at 11.

IPBIZ summarizes the case. Patently-O provides an overview and analysis. PharmaPatents criticizes the court’s broad interpretation of § 251, arguing that it will result in “twenty years of uncertainty” and a resurgence of post-grant strategic maneuvering. Patents Post-Grant, however, argues that Staats will have little effect because relying on broadening reissue applications as a matter of course has its own inherent drawbacks. (more…)

Federal Circuit Avoids §101 Analysis in Determining Patent Validity
By Jacob Rogers – Edited by Lauren Henry

MySpace, Inc. v. Graphon Corp., No. 2011-1149 (Fed. Cir. 2012)
Slip opinion

The Federal Circuit affirmed Northern District of California’s ruling on summary judgment that four of Graphon’s patents were invalid due to either lack of novelty or obviousness under 35 U.S.C. §102 and 35 U.S.C. §103, respectively. The district court found that these patents, which disclose a method for creating and searching a database over the Internet, were anticipated by the Mother of All Bulletin boards, created by Dr. Oliver McBryan. MySpace v. Graphon, No. 2011-1149.

The Federal Circuit held that the district court correctly ruled that Graphon’s patents were either anticipated or obvious and that the district court’s reasoning was adequately clear despite a failure to go through the full Graham factor analysis. Id. at 23 (citing Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 17 (1966)). The court also held that it was not necessary to examine the subject matter of the patents under 35 U.S.C. §101 because the case could be dealt with using §§102 and 103. Id. at 17-18. In so holding, the court compared the patentable subject matter requirements of §101 to the Constitution and suggested that the courts should apply something similar to the constitutional avoidance doctrine by endeavoring to resolve cases under §102 and 103 rather than §101 whenever possible. Id.

PatentlyO provides an overview and analysis of the case. The Patent Prospector criticizes the decision, arguing that the district court’s incomplete claim construction should have been reversible error. (more…)

Federal Circuit Invalidates Real Estate Investment Claims Following Bilski Precedent
By Elettra Bietti – Edited by Charlie Stiernberg

Fort Props., Inc. v. Am. Master Lease LLC, No. 2009-1242 (Fed. Cir. Feb. 27, 2012)
Slip Opinion

The Federal Circuit affirmed the District Court for the Central District of California, which had granted summary judgment in favor of Fort Properties. In a pre-Bilski decision, the district court had invalidated all 41 claims in American Master Lease’s (“AML”) real estate investment patent for failing to meet the subject matter eligibility requirements of 35 U.S.C. § 101 by applying the machine-or-transformation test.

Judge Prost, writing for the court, held that claims 1–31, which describe a real estate investment tool “tied to the physical world,” disclose an unpatentably abstract concept. Slip op. at 10. Following the Supreme Court’s decision in Bilski, Judge Prost held that an “abstract concept cannot be transformed into patentable subject matter merely because of connections to the physical world through deeds, contracts, and real property.” Id. at 10 (citing Bilski v. Kappos, 130 S.Ct. 3218 (2010)). Claims 32–41 contain the same ties, with an additional limitation requiring a computer to “generate a plurality of deedshares.” Id. at 11. Nevertheless, the court held that the added computer limitation did not save claims covering an abstract concept from invalidity, where such a limitation “is simply insignificant post-solution activity.” Id. at 13.

Bloomberg BNA provides a summary of the case and notes that the court identified “intricate and complex computer programming” as a distinguishing characteristic for patent eligibility. Patently-O criticizes the court for not defining “unpatentably abstract” and relying excessively on the similarities between AML’s patent and the invention in Bilski to reach its conclusion. (more…)

Justice Department Approves Google/Motorola Merger and Other Patent Acquisitions
By Jacob Rogers – Edited by Jonathan Allred

Investigations of Google Inc.’s Acquisition of Motorola Mobility Holdings Inc. and the Acquisitions of Certain Patents by Apple Inc., Microsoft Corp. and Research in Motion Ltd. (Feb. 13 2012).
Decision

On Monday, February 13, 2012, the Antitrust Division of the U.S. Dept. of Justice approved the merger between Google Inc. and Motorola Mobility Holdings Inc. as well as the acquisition of additional patents by Apple Inc., Microsoft Corp., and Research in Motion Ltd.

The Dept. of Justice’s decision allows the acquisitions, which concentrates technology patents in fewer hands, to go forward. Google, once it completes its merger, will acquire approximately 17,000 patents from Motorola as well as an additional 6,800 pending patents. Microsoft, Apple, RIM and others organized as a group under the name Rockstar Bidco will be able to complete their acquisition of approximately 6,000 patents and patent applications that they purchased from the Nortel bankruptcy auction. In addition, Apple will be able to separately acquire an undisclosed number of patents from CPTN Holdings, LLC, which were formerly owned by Novell.

After the purchases, Microsoft and Apple committed to supporting the existing licensing commitments made by Nortel and Novell. However, Google has not made a similar firm commitment with regard to the Motorola patents.

Steven J. Vaughan-Nichols, blogging for ZDnet, suggests that the Motorola merger is a move by Google to constrain Apple’s ability to initiate future lawsuits without needing to enforce its patents. According to Vaughan-Nicols, by agreeing to license its patents on fair, reasonable and non-discriminatory (“FRAND”) terms, Google is making a gesture of peace that Apple will reciprocate, rather than risk injunctions against its next generation of iPhone and iPad releases. PC Magazine suggests that Google’s purchase of Motorola may have been motivated by its inability to acquire any of the Nortel patents. However, the Antitrust Division Report notes that Google’s commitment to the FRAND standard is less clear than the commitments made by Microsoft and Apple. (more…)

Federal Circuit Affirms $371 Million Judgment Against W.L. Gore
By Michael Hoven – Edited by Matt Gelfand

Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs., No. 2010-1050 (Fed. Cir. Feb. 10, 2012)
Slip opinion

The Court of Appeals for the Federal Circuit affirmed a decision from the District of Arizona, which upheld a jury verdict that W.L. Gore & Associates’s employee had not jointly invented a vascular graft patented by Bard Peripheral Vascular, and that Gore had willfully infringed Bard’s patent. In addition, the Federal Circuit affirmed the lower court’s award of enhanced damages of $371 million, plus attorneys’ fees, costs, and an ongoing royalty to Bard.

The Federal Circuit held that there was substantial evidence to support the jury’s finding of willful infringement and that the district court had not abused its authority in awarding enhanced damages, fees, costs, and a royalty to Bard. Although Gore’s employee had supplied tubes of the substance ePTFE to the inventor behind the Bard patent so that ePTFE could be tested for suitability in vascular grafts, the court reasoned that the inventor of the Bard patent had the key insight into exactly how to fabricate ePTFE into successful vascular grafts, which was not anticipated by the work of Gore or other researchers investigating the use of ePTFE in such grafts. Further, the court rejected Gore’s argument that its employee was a joint inventor, pointing to evidence that the inventor of graft reduced the invention to practice without assistance from Gore. In so holding, the court stated that a researcher, if provided with a material to investigate a possible application, can claim an invention in his or her insight into the precise characteristics that make the material suitable for the application.

Bloomberg provides an overview of the case. The Patent Prospector says the patent at issue and its decades-long legal battle demonstrate that the patent system is broken. IP Biz noted the sharp exchange of words between the majority and the dissent. (more…)