February 29, 2008
If passed in its existing form, the bill masquerading under the euphemism "Patent Reform Act" will stifle growth and prosperity for the average U.S. citizen. It will slow down investment, reduce jobs and threaten economic recovery at a time we need it most. This misguided special-interest legislation still pending in the portals of the Senate must be stopped.
Money Changes Everything
MercExchange's patent assertion against eBay's "Buy It Now" feature resulted in a Supreme Court ruling that, using a four-factor test, essentially denied injunctive relief unless the patent holder was a direct competitor to an infringer. Thursday, eBay announced that it bought three patents from Merchange for an undisclosed amount, including 5,845,265, the centerpiece of the matter.
Micron sought declaratory judgment in Northern California against memory-chip competitor MOSAID, the day before MOSAID filed in East Texas. Northern California district court pitched the DJ matter. Micron appealed. The appeal ruling is a textbook of current case law for declaratory judgment jurisdiction and district court discretion.
February 28, 2008
The University of California and Abbott went after Dako for infringing DNA screening patents 5,447,841 and 6,596,479. After a district court priority blunder, and turning aside a preliminary injunction motion, claim construction gave Dako a noninfringement out; until appeal.
The "upgrade" to Movable Type (MT) 4 was a bilious bumble. Basically, it blew chunks, and it was no self-revelation that I make a cantankerous janitor. MT seemingly gave no consideration to backward compatibility. Among other tedious wankings, subscription notification went to hell in a bucket without leaving a "thank you" note. So now it's a Kenny Rogers moment: know when to hold 'em, and know when to fold 'em.
February 27, 2008
Tessera, semiconductor miniaturization maven, took a half-dozen companies to task before the International Trade Commission (ITC), including Motorola, Qualcomm, Freescale Semiconductor, and ATI, a unit of Advanced Micro Devices (AMD). Monday morning, just before the ITC trial was scheduled to begin, Administrative Law Judge Theodore Essex brought the tent poles down, pending reexamination outcome of the asserted Tessera patents.
Myth tells us that fish grow to the size of their tank. Reason suggests, related to a USPTO examiner, this myth may prove out.
February 26, 2008
Medtronic's lawyers were hammered for malpractice in patent suit against BrainLAB last week. Now a different legal crew barking for Medtronic has been slapped a $10 million fine for similar malfeasance.
Carlos Amado owns 5,293,615, which claims an interface method between spreadsheet and database programs. Amado sued Microsoft for its Office product infringing, and won 4¢ per copy royalty, and an injunction. The injunction was stayed pending post-trial motions, during which Amado got 12¢ per copy royalty. In wake of the SCOTUS eBay decision, the injunction was dissolved by the district court. On second appeal, the CAFC affirmed the district court handling of injunction, while a spat about spare-change royalty rate was remanded.
On-Line Chat for Independent Inventors
Every couple of months the USPTO hosts an on-line chat, allowing independent inventors to ask questions regarding the patent process. The next chat: Thursday, February 28th, from 2 to 3 PM (EST).
Monday, the Supreme Court snubbed certiorari for the CAFC en banc Seagate decision that practically eviscerated willful patent infringement. Nor reason was given. To seek enhanced damages, the Seagate standard requires that a patent holder prove that an infringer was "objectively reckless" in knowingly infringing a patent. Damages deflation ahead.
February 25, 2008
Last February, the appeals court found Medtronic's four-patent assertion against BrainLAB worthless, upholding Colorado district court Judge Richard Matsch overturning a duped jury verdict of infringement. Back before the district court, entertaining a post-trail motion by BrainLAB to recover all attorneys fees and costs, Judge Matsch raked Medtronic's attorneys over the coals, particularly Terrence McMahon and Vera Elson of McDermott Will & Emery.
February 24, 2008
Worldwide Patent Survey
Joff Wild of Intellectual Asset Magazine surveyed the 2007 international patent scene, and found some patent puppies with growing pains, while old dogs are up to tricks both old and new.
Rick Frenkel's setup for blogging always seemed a bit queer - anonymously blogging voyeuristically, by supposedly peeking behind the curtain of non-practicing patent holders quietly enforcing their patents, as if anyone should care about that ipso facto. That the blog name was Patent Troll Tracker was a dead giveaway to the author being a serious case of IP arrested development. That he did so anonymously was the silly irony: wanting to unmask others while staying masked himself.
USPTO registration exam questions have remained very similar throughout the years, some word-for-word identical, but the overall focus of the 100-question exam has shifted drastically. Is this merely the necessary result of a shift in exam format, or is it an indication of a change in focus at the PTO? Regardless, for those currently preparing for the Patent Bar, modify your study plan accordingly.
February 23, 2008
Follow the Money
If you wonder why, for the Patent Reform Act, Senator Leahy is so hot to trot, it's that he got paid and bought. Of the $2.4 million packed into Leahy's political piggy bank in the past five years, $3/4 million came from "lawyers and lobbyists;" not surprising, given that Leahy is Senate Judiciary Committee chairman. Second place in pork placement was the computer-related sector, approaching $1/2 million. Third place is under $200,000. Heavyweights in digital technologies, including communications companies, which are totally digital too, are the pushers for so-called "patent reform."
February 22, 2008
With USPTO allowance rates at an all time low, there has been frequent analysis and speculation regarding cause and implication. There is a player in the shadows: the supervisory examiner.
For now, the CAFC retains a polite fiction: "We review claim construction de novo on appeal. Cybor Corp. v. FAS Tech., Inc., 138 F.3d 1448, 1456 (Fed. Cir. 1998) (en banc);" de novo because claim construction is considered a matter of law, not a factual inquiry. In today's Aristocrat nonprecedential reversal and remand, summary judgment of indefiniteness in claim construction was ruled in error because "genuine issues of material fact remained pertinent."
6,733,328 has been treated like a commodity. It was originally assigned to Ultra Products, then transferred to Taiwan-based Transpower Technology. Transpower made Retractable Technologies LLC exclusive licensee, capable of enforcing the patent; although Dallas-based Data Drive claims to be exclusive licensee, but that Retractable could license the patent with permission. Retractable cracked the whip in Wyoming Tuesday, against Belkin, RadioShack, Fry's Electronics, Targus, and others.
February 21, 2008
On-Sale Bar Ruffle
In reply to potential customer Sealy, a bed mattress maker, Atlanta Attachment developed a sewing machine for automatically creating gusset rufflers. There was a verbal understanding of confidentiality. Over time, Atlanta Attachment sent prototypes to Sealy, in September 2000 invoicing Sealy for the third of four prototypes ultimately delivered. The last prototype was but a minor jigger difference from the third.
A View from Tel Aviv
Bernard Frieder is a consultant to technology companies in Israel, miffed at the U.S. Congress for threatening to wreck the U.S. patent system with its Patent Reform Act of 2007.
Because inventors, research organizations and startup ventures around the world rely on US patents to protect the output of their labor, changing the US patent system has global repercussions.
George Margolin of the Professional Inventors Alliance had a graphic response to last week's editorial in the Washington Times by Senators Leahy, touting S. 1145, the Senate bill to deform the U.S. patent system. "All inventors strongly disagree with [Leahy], but he wouldn't know that because he has allowed few, if any, real inventors speak before his committee," Margolin conjectured.
Korea Aerospace University Professor Lee Keung-hae invented software for automatic linguistic switching between Korean and English. Lee lost his initial patent assertion against Microsoft for its Korean version of Word, in 2000. At the time, Lee claimed $42,000 in damages. Following trial, Microsoft countersued Lee in 2001 to invalidate the patent, but the Korean Supreme Court ruled that Lee was holder of a valid patent. As a result, a lower court recently ruled in Lee's favor. Lee is now totting up damages, expected to be at least an order of magnitude greater than those originally sought.
The Eastern District of Texas has become the most popular court for patent litigation. As a result, with stuffed docket, time to trial has stretched to about two years. Other districts are taking up the slack, notably the Western District of Wisconsin and the Eastern District of Virginia, but there is a potential drawback to the also-rans.
February 20, 2008
Wireless & Witless
BlackBerry maker Research in Motion (RIM) and Moto Q maker Motorola sued each other Saturday for patent infringement. Illinois-based Motorola chose Delaware and the Eastern District of Texas, while Ontario-based RIM chose the Northern District of Texas. No venue shopping there.
February 19, 2008
The U.S. Patent Reform Act of 2007 is a gift, a most welcome change, if you are an Indian generic drug maker. The view from Mumbai:
The immediate impact of the law change will be to ease challenges on drug patents and also lower legal costs in such challenges.
A pair of preliminary injunctions vacated on appeal, putting claim construction and KSR as the cruxes of justification. In Erico v. Vutec & Doc's Marketing, though hotly contested, KSR Obzilla stomped in to quash a preliminary injunction. In Chamberlain Group v. Lear, a rather obvious inconsistency in claim construction resulted in preliminary injunction reversal.
CAFC on Patent Reform
Chief Judge Michel of the U.S. Court of Appeals, Federal Circuit (CAFC), addressing the Association of Corporate Patent Counsel on January 28, 2008, backhandedly took Congress to task for being duped by asinine academics, essentially rumor mongers, jumping to conclusions, ignorant of facts. Noting selective Congressional committee reportage, Michel hints that the fix was in.
February 18, 2008
Igor Sikorsky flew the first helicopter in 1941. In 1943, Frank Piasecki flew the second helicopter, the PV-2, built from junk auto parts in a Philadelphia garage. The PV-1 never made it past the drawing board.
The first PV-2 flight was rambunctious: Piasecki had only 14 hours flight experience in a small Piper Cub airplane. The PV-2 was tethered to a clothes line. The first flight was only supposed to be a couple of feet off the ground. The helicopter went up, the clothes line snapped, and Frank was winging it.
Patents as Intangible Asset Partitions
Everybody knows that corporations shield shareholders from liability for debts of the corporations. But corporations perform another function, which may be even more important for startups: corporations shield the corporate assets contributed by one shareholder from being raided by the creditors of other shareholders. To see how much this matters, imagine how difficult it would be to form a pool of capital for funding a startup if funding had to be renegotiated everytime one of the startup's investors died or declared bankruptcy. Were corporations not to perform this vital function for shareholders, the costs of negotiating with every potential future creditor of other shareholders would quickly outstrip the benefit of pooling capital in the first place.
In a pathbreaking article, Prof. Paul Heald explains how patents perform a similar transactions-cost-reducing function for intangible asset owners.
February 17, 2008
As reported last week, Dr. Bruce Saffron nabbed Boston Scientific for patent infringement to the tune of $432 million. Friday, the presiding judge tacked on $69 million in pretrial interest. Saffron's lead attorney pipped: "$69 million is a nice amount." Prejudgment interest is common, but not a given.
Economist Robert Shapiro and health care policy maven Aparna Mathur rip into provisions of the Patent Reform Act currently swirling the bowl in the Senate. In a study published by the Biotechnology Industry Organization, the authors project the repercussions of damages apportionment, post-grant opposition, and lowering the bar for inequitable conduct.
Yes, The Patent Prospector has been off the air for a couple of days; but is once again pleased to broadcast a seamy stream of random competence in the patent world. As chronicled herein, senators, Supreme Court Justices, inventors, and run-of-the-mill patent attorneys parade as nincompoops on a tear. In other reportage, occasionally events make sense.
February 15, 2008
Good Old Bozos
Senators Leahy and Hatch, in a Washington Times editorial, cry wolf about the need for patent reform, dishing out fallacious logic and rummy rumor posing as fact. "Meaningful patent reform is crucial to America's ability to maintain its competitive edge in the world," they toot, without evidentiary basis or rational reasoning matching perceived problem to proposed solution.
February 14, 2008
Keith Perine in the Congressional Quarterly spied the stall in the Senate version of the Patent Reform Act.
The Senate is not expected to take up a measure to overhaul patent laws until April at the earliest, as agreement on the complex legislation remains elusive. Senate Judiciary Chairman Patrick J. Leahy, a Vermont Democrat who sponsored the legislation (S 1145), acknowledged Wednesday that it likely won't be on the floor until after a two-week March recess. So far .... there have not been substantive negotiations over complex provisions - particularly a section dealing with damages awards in patent infringement lawsuits - since the Judiciary panel approved the bill last July... Lobbyists have predicted that the committee-approved bill does not have a filibuster-proof majority of 60 votes.
Money is a lubricant and a salve. Banks apply the salve to others to ease their own pain: potent wads in political lobbying and campaign contributions. With the housing market in deep kimchee, the banking industry is pushing proposals to shift the risk of mangled mortgages to the Federal Housing Administration; considered far-fetched a few months ago, now more a matter of when than whether. Then there's this pesky patent holder, DataTreasury, that practically patented "Check 21," the federal law for digitally archiving checks.
February 13, 2008
The Innovation Alliance sports a study by Prof. Paul Janicke that concludes: "There is no pattern of runaway jury verdicts in patent cases." What's more: "Despite what some argue, under our system of justice, judges do not simply "rubber stamp" a jury's damage award."
Wage Slave to Own
Back in 1991, the Barstow brothers, David and Daniel, patented a way to include computer events within a live broadcast. Being sports fans, the Barstow boys dreamt up the idea from wanting to watch baseball games simulated on a computer. They went after MLB Advanced Media, who got the matter tossed in district court over subject matter jurisdiction. Problem was that David worked, under employee contract, for Schlumberger when the patent was filed, leaving title under a cloud. The district court wouldn't hear the Barstows out, so the Barstows appealed.
February 12, 2008
The Coalition for 21st Century Patent Reform, whose motto is "patents matter," made no small matter of making money matter in lobbying for patent legislation: paying law firm Akin Gump $1.2 million in 2007 to grease the skids.
Stent for Rent
Over a decade ago, radiologist Dr. Bruce Saffran invented a drug-eluting porous sheet, and was granted 5,653,760. Boston Scientific liked the idea. Imitation resulted in flattery costing $431.9 million, an 8% royalty on U.S. sales, and 6% on foreign sales, from 2004 through last September. The award was reputedly the sixth largest in history. Hard-nosed BS will try to get presiding Eastern District of Texas Judge T. John Ward to overturn the jury verdict; barring that, appeal.
February 11, 2008
It's a Dud, Dude
Patent monger Alcatel-Lucent sued Dell in 2003 over 15 patents; Dell counterclaimed with 6,038,597 and 6,182,275, related to Internet computer product ordering. Jury trial found Dell's patents valid and non-infringed. Dell was ordered to pay costs.
Petition for CAFC en banc rehearing In re Nuijten shorted out 9-3. Nuijten had appealed encoded signal claims, disallowed by the BPAI as unpatentable subject matter under 35 U.S.C. § 101; a ruling upheld in CAFC panel. A cogent dissent signals the wire still live: the Nuijten ruling conflicted controlling precedent, and left unanswered questions about the relationship between § 101 & § 103. Resolution awaits a willing en banc, or certiorari before SCOTUS.
February 10, 2008
Black Hole of Enablement
Enablement was spun into a black hole of uncertainty by the CAFC in Sitrick v. Dreamworks, which expanded the enablement requirement at least to the degree that an accused product must be a disclosed embodiment for a claim to be enabled. Hal Wegner: "In essence, Sitrick voids any generic claim that is fully enabled as to a preferred embodiment, but includes other embodiments not yet enabled." Can a patent now be invalidated by showing any undisclosed embodiment within the scope of a claim?
February 9, 2008
CIBA Vision, maker of extended-wear contact lenses, was short-sighted: its ophthalmologist, Rembrandt Vision Technologies, corrected CIBA's vision. The tab was $41 million. That's a 6+% royalty for past sales of contact lenses infringing 5,712,327, which claims contact lenses with superior water absorption. Rembrandt now has superior lucre absorption.
Drilled in Norway
Transocean, the world's largest offshore drilling company, has a patent portfolio for multiple-activity offshore drilling that has been a gusher, scoring licensing agreements from major competitors, including Nobel and Pride International. Now a Transocean drill has been bit: two Norwegian patents have been invalidated by a Norwegian court in Transocean's suit against Smedvig, acquired by Seadrill in 2006. Transocean was ordered to pay all litigation expenses. An appeal is being mulled.
February 8, 2008
In the Eastern District of Virginia today, savvy Judge James Cacheris heard oral arguments on whether the USPTO may implement its proposed examination rules changes. The crucial issue is whether the changes are substantive, which they are. Textbook interpretation is that the patent office is proscribed by law from promulgating substantive changes, and from applying them retroactively, as in this instance. The sanctimonious PTO argued that the changes were not substantive, but if even they were, the agency had authority. Judge Cacheris swore to render decision ASAP, but "there is a lot of paper to consider."
WARF, the Klingon who once served on the Starship Enterprise, has resurfaced on earth as a patent troll, albeit oversized, as patent trolls are normally dwarfish. Whatever. WARF is bashing Intel for CPU patent infringement after negotiations understandably failed: Intel does not speak Klingon.
February 7, 2008
Carnac The Magnificent
As prescient as he is scrupulous, Grand Patent Poobah Jon Dudas predicted patent reform passage: "I'm optimistic that we'll have patent reform because what we see is that there are very real answers. We're an innovation economy. We think that the model works, but can be improved [to arrive at] a positive bill that can benefit everyone."
The organized crime syndicate known as the USPTO tried to thwart input in its fight to implement its illegal rule changes to examination practice. The attack is answered.
Despite representing to this Court several times that the administrative record was complete, the PTO itself demonstrated otherwise when it recently and belatedly supplemented the administrative record, not once but twice. These submissions establish a pattern of "deliberately or negligently" omitting adverse documents from the record.
The Financial Times posted an opinion piece by Patti Waldmeir that surmised Congress just contemplating patents is just about right.
At such a time of uncertainty, inertia may be the better part of valour: Congress has wasted years not solving the patent problem; it is hard to see why lawmakers should rush things now, when the only problems left to resolve are the really hard ones.
The Patent Union
An brotherhood of unions forge opposition to patent tomfoolery in the Senate -
[P]rovisions contained in S. 1145, the Patent Reform Act of 2007, that we believe could undermine the competitiveness of U.S. industry and put our members' jobs at risk.
February 6, 2008
Wilson Sporting Goods owns baseball bat patent 5,415,398, but it can't get a hit to first base. In the patent's third appearance before the CAFC, Wilson strikes out as Miken Composites keeps its walk of non-infringement.
Patent litigation is tremendously expensive. And noisy. The ruckus has stirred quite a crowd: fat geezers with political heft to match are jostling to shuffle the seating arrangements in the patent spat ballroom. The stakes for infringers can stray to six to nine figures or more. Microsoft keeps a small army of patent litigators marching on the defense of 30 to 40 contemporaneous assertions. Though not as bad a barrage as Microsoft, quite a few large firms face regular patent battles. Why not take a more civilized path?
February 5, 2008
Dakota farmer Loren David tried to cheat Monsanto by saving and replanting patented soybean seeds, a breach of contract as well as patent infringement. Monsanto caught him, and it's going to cost David in the neighborhood of $700,000.
Patent Office on Patent Reform
USPTO management posted on its internal agency website a position statement concerning changes in pending patent law. The patent office strongly opposes damages apportionment, while supporting the new post-grant opposition regime.
Lack of Consensus
Senate Judiciary Committee Chairman Patrick Leahy recently released a Senate status summation on S. 1145, the Patent Reform Act of 2007. It shows a diversity of comprehension, misunderstanding, and uncertainty by various senators. Meanwhile, the White House chips in.
February 4, 2008
Linux godfather Linus Torvalds took potshots at patents in general and software patents in particular in a Linux Foundation podcast. Torvolds damns with faint praise Microsoft's restraint in patent assertion. From the remarks, one may conclude that casting from a pod makes one grumpy.
800 Pound Gorilla
As part of its effort to dominate the high technology sector, Microsoft is seeking to fundamentally transform the treatment for those entities that infringe on the intellectual property of other innovators by minimizing the damages the victim could receive and to ensure that the potential for harassment would extended dramatically by allowing for virtually endless attacks on patent validity.
February 3, 2008
The Electronic Frontier Foundation is a self-appointed busybody for relieving owners of their intellectual property whenever possible. Their Patent Busting Project aims at "illegitimate" computer-related patents. EFF modus operandus is filing reexamination requests on "particularly egregious patents;" namely, those where the owner raises an enforcement stink, and EFF thinks it has dug some decent prior art.
USPTO examiner training in obviousness rejections has been ongoing. In review, what shines as sunlit crystal is the legacy of KSR: how disparate technologies may be combined as basis for rejection, beyond what prior art disclosed.
February 2, 2008
Pass the Glue
In F&G Research v. Dynapoint (Taiwan), the CAFC ruled Allen D. Brufsky a scumbag: having "significantly misrepresented the facts," relying on "vague allegations without basis in the record," and showing "a willingness to mislead the court." It's a shame, because Brufsky has one gorgeous web site. You'd think a guy with taste would have class, but there you go.
In A Hurry
Two former patent office commissioners show themselves as shoddy analysts in their capacity as toads for the corporate special interest group Coalition for 21st Century Patent Reform. But in doing so, they prove the hoary adage that every once in a while, even a blind pig finds an acorn.
February 1, 2008
David Sitrick sued movie makers DreamWorks and Warner Brothers for infringing 5,553,864 and 6,425,825, which claim integrating a user's voice or imagery into a pre-existing video game or movie. The district court process was fitful, but the judge granted summary judgment: invalidity for lack of enablement for movies, though having no problem with enablement for video games. The CAFC affirmed.