Patent

Multiple patent applications have purportedly been filed in several countries by a law school professor on behalf of an artificial intelligence named DABUS. While the applications are not yet open for public inspection, a website devoted to the project details the subject matter of the inventions as an improved food container and a signal beacon, both of which were "created" by the artificial intelligence. The project appears to be an attempt to challenge the definition of "inventor" under the patent laws of various countries, which are generally restricted to individuals. Ostensibly, the purpose of the filings is to create a "case or controversy" by identifying a machine as the "inventor" in order to draw an objection to the applications. Once an application is refused on that basis, the case may be ripe to seek judicial review of the statutory definition of "inventor." Although, whether a machine has standing to appeal such an administrative determination is unclear, unless other interested parties are permitted to carry the suit. 

Identifying a machine as an inventor raises a host of other issues pertaining to the ownership of an invention, inlcuding the right to sue for infringement or collect royalties. Such issues would likely require a legislative amendment, rather than a favorable judicial interpretation of the existing defintion of "inventor," in order to avoid these kinds of ambiguities. 

In a 9-0 opinion issued by Justice Thomas, the Supreme Court held today that even where the buyer is obligated to maintain confidentiality of an invention, the inventor's "secret" sale of an invention may place the invention "on sale" for purposes of the America Invents Act, and confirmed that the America Invents Act did not change the definition of "prior art" with respect to the on-sale bar. 

Monday, 10 December 2018 16:16

When is an invention "on sale?"

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The Supreme Court is currently posed with the question: Does the confidential sale of an invention disqualify that invention from later patenting? Helsinn Healthcare S.A. v. Teva Pharm. USA, Inc., 138 S.Ct. 2678 (2018).

The patent statute does not directly address this question, but does state that an invention is precluded from patenting if that invention was “on sale” or “in public use” prior to the filing date for that patent application. Years of case law have added to the meanings of these terms. But now there is an additional term, “or otherwise available to the public.”  35 U.S.C. § 102(a)(1).  Under which circumstances does this new term preclude patenting? Circumstances that are applicable to the certified question for the Court?

The Supreme Court has previously ruled that public use of an invention will not preclude patenting if the public use is for experimentation.  Pfaff v. Wells Elecs., 525 U.S. 55, (1998).  That Court qualified the statutory language, reading in the experimentation use.  But that Court did not rule on the “on sale” criteria except to identify a distinction between experimental use and “products sold commercially.” Is there a similar qualification of a commercial sale, supported by precedent and legislative history, that can exempt a confidential sale from being barred from patenting?

And where would “otherwise available to the public” fit in here? Does “otherwise” mean that the previous items in the list, such as “on sale,” are also to be understood as “available to the public?” Or is it a modern catch-all for new patentability conditions that were not contemplated when the provision was written in 1952?

Based upon certain criteria including win rate and the time involved to get to trial, a 2018 study by PricewaterhouseCoopers (“PWC”) suggests that patent owners seeking to enforce their rights should file suit either in the Middle District of Florida (encompassing Jacksonville, Ocala, Orlando, Tampa, and Fort Myers), or the Southern District of Florida (which includes the South Florida metropolitan areas of West Palm Beach, Fort Lauderdale, Miami, and the Florida Keys).  Breaking down those factors using case studies and empirical data, PWC found that a patent owner who tried their case in the Middle District of Florida had a remarkable 50% statistical likelihood of prevailing (ranked 2nd in the United States), with the Southern District of Florida not too far behind (ranked 8th in the country).  In terms of the amount of time it took to get to trial –a significant factor in terms of the overall costs and expenses involved for the patent holder – cases brought in the Middle District of Florida were tried in 1.9 years (3nd in the United States), whereas lawsuits filed in the Southern District were tried in 2.1 years (6th in the United States).  Averaging all of the other underlying criteria involved, the PWC survey found that the Middle District of Florida had an “overall rank” of 6th in the entire United States, with the Southern District of Florida closing the gap at 11th in the country. 

Having focused its practice exclusively on patent law and other intellectual property areas since 1959, Malloy & Malloy, P.L. can assist you in filing a patent application or otherwise enforcing your rights, if necessary, through the litigation process.  Malloy & Malloy has an office in Jacksonville, Florida overseen by firm partner, Jennie S. Malloy, as well as offices in South Florida.  Please click the following for full contact information:   https://malloylaw.com/contact

Link to PWC study:   http://www.ipwatchdog.com/wp-content/uploads/2017/05/2017-Patent-Litigation-Study_PwC.pdf

Last month, the United States Supreme Court granted a petition for a writ of certiorari in Helsinn Healthcare S.A., Teva Pharmaceuticals USA, Inc. In 2017, the U.S. Court of Appeals for the Federal Circuit held that a publicly disclosed commercial sale amounts to an invalidating act, even when the details of the invention are not publicly disclosed.

The United States Supreme Court will decide whether under the Leahy-Smith America Invents Act, an inventor’s sale of an invention to a third party that is obligated to keep the invention confidential qualifies as prior art for purposes of determining the patentability of the invention.

The outcome will be interesting, as sometime in 2019 the Supreme Court should provide some guidance on the scope of the on-sale bar (i.e., those acts and/or disclosures that occur prior to the filing date of a patent application, which could affect the validity of a patent). A different issue, which will not be in front of the U.S. Supreme Court for review, at least for a while, is whether a secret commercial sale amounts to an invalidating act.  

 

Following our previous report, the U.S. Supreme Court held in WesternGeco LLC v. ION Geophysical Corp. that WesternGeco, the patent owner, can recover lost foreign profits as a result of ION's infringement under §271(f)(2) of the Patent Act. WesternGeco LLC v. Ion Geophysical Corp., U.S., No. 16-1011, 6/22/18.  Justice Thomas delivered the majority opinion in the 7-2 decision.

Over ION's objection that the lost-profits damages occurred outside of the United States and the foreign conduct after ION's infringement was necessary to give rise to the infringement, Justice Thomas wrote that awarding lost-profits damages under the circumstances was a domestic application, and therefore, consistent with the presumption against extraterritoriality that presumes federal statutes apply within the U.S.

Tuesday, 19 June 2018 20:43

USPTO Issues Patent No. 10,000,000

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The United States Patent and Trademark Office celebrates a milestone today as it issues United States Patent No. 10,000,000 to the Raytheon Company for "Coherent LADAR Using Intra-Pixel Quadrature Detection." The patent is due to be signed by President Trump and will be the first patent to bear the USPTO's new patent cover design. 

Tuesday, 15 May 2018 19:48

Retroactive IPRs

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In Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, et al., the Supreme Court ruled that an inter partes review (IPR) proceeding does not violate the Constitutional right to be heard in court. But that decision did not consider whether an IPR—a procedure in effect only since September 16, 2012—could be applied to patents filed prior to that date. In fact, the Supreme Court expressly reserved that issue of “retroactive application” for a future case. That is, the Court acknowledged there is a potential controversy regarding the application of IPR to patents filed before the effective date of the IPR procedure.

So, are patents that were filed prior to September 16, 2012, subject to IPR? If not, does that mean those patents are not subject to any inter partes challenge at the PTO? Or does that mean those patents may still be subject to an inter partes reexamination, as that proceeding existed prior to September 16, 2012?

Since the Supreme Court expressly reserved this issue for future cases, and since the IPR procedure remains a popular option, it is likely the Federal Circuit will weigh in on the issue before too long. Which aspects will the Federal Circuit find compelling?

-The reliance on the pre-IPR patent system by inventors who chose not to protect their invention through trade secrets?

-Statistical data that illustrates different substantive results between inter partes reexaminations and inter partes reviews?

-The strength or weakness of the particular patents before the court?

                The statute that created the IPR defines that proceeding to apply to “any patent issued before, on, or after that effective date.” Pub. L. 112-29, § 6(c)(2). But with the express reservation by the Supreme Court, will the statute—or at least the retroactive application of it—survive?

Monday, 22 January 2018 16:06

The USPTO During Government Shutdown

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While many federal agencies are currently furloughed, the U.S. Patent and Trademark Office (“USPTO”) has announced that it will be able to maintain regular operations for a few weeks due to excess revenue from last year’s fee collections. Should the USPTO exhaust its reserve funds, the agency will officially shut down but maintain a small staff to accept new applications and maintain information-technology (“IT”) infrastructure. There is no comment at this time on whether outstanding USPTO deadlines would be extended in the event of a closure, but the Firm will continue to monitor the USPTO’s status and advise clients accordingly.

One measure of damages for patent infringement is compensation for lost profits of the patent owner. Additionally, a patent owner may enjoin the export of parts of a patented invention from the United States, if the parts will be assembled or used for an infringing purpose. However, the Supreme Court is set to answer the question of whether lost profits may be awarded to the patent owner for service contracts, performed outside the U.S., making use of those parts exported from the U.S. in the case of WesternGeco LLC v. ION Geophysical Corp. If the answer is affirmative, then the scope of damages available to a patent owner may be drastically expanded -- up to USD $93 Million in WesternGeco's case.

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