2021 Q3 Patent Defenses Update
Highlights from July – Sept. Fed. Cir. decisions on substantive patent law.
Williamson Strikes Again
Twelve post-Williamson Federal Circuit opinions have held that claim language lacking the word “means,” invokes interpretation under section 112(6/f). See https://patentdefenses.klarquist.com/1126f-claim-language/.
- Team Worldwide (Fed. Cir. 09/09/21) (non-precedential) (aff’g PTAB that “pressure controlling assembly … configured to” perform four functions, (1) invokes section 112(f) (based on functional claim format, “assembly” being generic, Spec. providing no structural definition, extrinsic evidence using term functionally, and giving no weight to Examiner’s silence on whether term invokes 112(f)), and (2) renders claims indefinite because Spec. lacks structural support for at least one of the functions).
Lack of Full-scope Written Description Erases $1.2 Billion Judgment
Many a patent owner has lost under this foundational principle of patent law: “What is claimed by the patent application must be the same as what is disclosed in the specification; otherwise the patent should not issue.” Festo (U.S. 05/28/2002). See https://patentdefenses.klarquist.com/written-description-sec-112/ (search “full scope”).
- Juno (Fed. Cir. 08/26/21) (rev’g denial of JMOL of no full-scope written description support, and damages award of $1.2 BB, where Spec. provides “no means of distinguishing which scFvs [single-chain antibody variable fragments] will bind to which targets.” The disclosure of two working embodiments “does not provide information sufficient to establish that a skilled artisan would understand how to identify the species of scFvs capable of binding to the limitless number of targets as the claims require.”).
A Reason to Add Efficacy or Utility Limitations to at Least Some Claims
“Because the claims are directed to humanized antibodies, the question before the Board was whether a skilled artisan at the time of the invention would have been motivated to make the claimed humanized antibodies, not whether a skilled artisan would have been motivated to use those antibodies to treat human disease.” Teva Pharm. (Fed. Cir. 08/16/21) (aff’g PTAB obviousness finding; question is “whether those concerns would have dissuaded a skilled artisan from making the claimed antibodies to study their therapeutic potential in the first place”).
Don’t Shortchange Reasonable Expectation of Success
In addition to showing motivation to combine references, patent challenger “was required to show that a skilled artisan would have had a ‘reasonable expectation’ of success in treating vasomotor symptoms, even if such success was not guaranteed in all cases.” Eli Lilly (Fed. Cir. 08/16/21) (aff’g PTAB finding of no reasonable expectation of success, despite finding of motivation to combine, in part in view of lack of efficacy data in prior art references (although such data is not always required)).
Sec. 287: Absent Required Marking, No Substitute for Patent Owner Providing a Specific Charge of Infringement
Evidence showed that the defendant knew of the patent, collaborated with the patent owner, was warned by the patent owner not to infringe, and possibly knew he was infringing, but none of that satisfies the requirements of Sec. 287. Lubby Holdings (Fed. Cir. 09/01/21) (2-1) (rev’g jury award (and JMOL denial) of pre-suit damages).
Patent Infringement Liability … “I Was Just Doing My Job” is Not a Defense
Corporate officers are derivatively liable for their corporation’s patent infringements only if the corporate veil is pierced. But officers are personally liable for their own patent infringements (e.g., offers to sell) even if acting in corporate capacity. See https://patentdefenses.klarquist.com/271a-direct-infringement-of-any-type-of-claim/.
- Lubby Holdings (Fed. Cir. 09/01/21) (aff’g liability of corporate officer for direct patent infringement even though he was acting in his corporate capacity, without any need to pierce corporate veil or show that corporation was officer’s alter ego).
Patent Pros Know: Claim Limitation v. Claim Element v. Claim Environment v. Patentable Weight
Some claim language has no patentable weight, i.e., cannot help defend the claim against an invalidity challenge. Some claim language is not a limitation, i.e., need not be considered when proving infringement. Some claim language is a limitation but has no patentable weight (e.g., some process limitations in a product-by-process claim). See https://patentdefenses.klarquist.com/no-patentable-weight/. Some claim language is a limitation but not a claim element, namely, it’s the claim “environment” which must be present for infringement but need not be provided or performed by the accused infringer. See https://patentdefenses.klarquist.com/271a-direct-infringement-of-non-method-claim/ (search “environment”).
- Where preamble language “three dimensional” spreadsheet was given patentable weight in prior section 101 eligibility decision, that indicates it is limiting for infringement analysis. Data Engine II (Fed. Cir. 08/26/21) (aff’g claim construction and non-infringement).
Patent Standing … in the Fog
Tax lawyers cost a client a $236 MM patent-infringement verdict, at least for now. For tax reasons, a corporate parent assigned patents to a subsidiary and got an exclusive license back, only it was not an exclusive license of exclusionary rights so the parent lacked “standing,” forcing a new trial with only the subsidiary as plaintiff. In denying mandamus, the Federal Circuit noted that its long-time law on what is needed for (non-waivable) Constitutional standing versus (waivable) statutory standing, is in doubt ivo Lexmark (Static Control) (U.S. 03/25/2014). See https://patentdefenses.klarquist.com/constitutional-standing/.
- In re Cirba (Fed. Cir. 09/22/21) (non-precedential) (“It is not clear … that Lexmark and Lone Star also require us to alter our precedent holding (as the district court summarized it) that ‘the touchstone of constitutional standing in a patent infringement case is whether a party can establish that it has an exclusionary right in a patent that, if violated by another, would cause the party holding the exclusionary right to suffer legal injury.’”).
Utility and Alice
Even useful abstract ideas are abstract. On the other hand, the asserted utility of a purported advance often is a factor helping a claim survive Alice scrutiny. The key is whether the utility arises from an advance in the physical realm or instead an advance in information, a mental process, etc. Patent challengers, therefore, should explain that the patent’s alleged utility is inherent in the idea itself.
- PersonalWeb (Fed. Cir. 08/12/21) (“the asserted efficiency improvements are not different in kind from those that would accrue in the library analogue—for example, using content-based identifiers to purge duplicate books”).
132 Post-Alice Fed. Cir. Opinions Articulating “Abstract Idea” to Which Claim is Directed
Patent Defenses quotes each “abstract idea,” including those below from decisions this quarter. See https://patentdefenses.klarquist.com/patent-eligible-subject-matter-sec-101/. Useful table to review when seeking to articulate the abstract idea of a patent to be challenged under Alice.
|Abstract Idea Decision||“Abstract Idea” To Which Claims Directed||Ruling|
|In re Elbaum (Fed. Cir. 09/02/21) (non-precedential) (per curiam)||“a method of providing information and allowing customers to utilize that information to engage in a commercial transaction”||aff’g ex parte rejection
at least 2 claims
|Universal Secure (Fed. Cir. 08/26/21) (Stoll, J.)
Apple (Fed. Cir. 08/26/21) (non-precedential) (Stoll, J.) (amended claim in IPR of same patent)
|“collecting and examining data to enable authentication”||“collecting and examining data to enable authentication”|
|MyMail II (Fed. Cir.) (08/19/21) (non-precedential) (Moore, C.J.)||“updating toolbar software over a network without user intervention”||aff’g R. 12(c)
at least two claims
|PersonalWeb (Fed. Cir. 08/12/21) (Prost, J.)||“the use of an algorithm-generated content-based identifier to perform the claimed data-management functions, which … include controlling access to data items (the ’310 patent), retrieving and delivering copies of data items (the ’280 patent), and marking copies of data items for deletion (the ’662 patent).”||aff’g R. 12(c)
|Sensormatic (Fed. Cir. 07/14/21) (non-precedential) (Lourie, J.)||“wireless communication and remote surveillance”||aff’g R. 12(c)
|Aftechmobile (Fed. Cir. 07/13/21) (non-precedential) (per curiam)||“enabling the creation of mobile applications without coding by combining pre-coded software components”||aff’g R. 12(b)(6)
at least 2 claims
|Bot M8 (Fed. Cir. 07/13/21) (O’Malley, J.)||“increasing or decreasing the risk-to-reward ratio, or more broadly the difficulty, of a multiplayer game based upon previous aggregate results”||aff’g Summ. J.
2021 Q2 Patent Defenses Update
We summarize below selected substantive patent law Fed. Cir. and S. Ct. decisions since Apr. 1—from Klarquist’s free, mobile-friendly legal research tool Patent Defenses (www.patentdefenses.com), updated frequently.
Prosecution Laches: New Life
Long-delayed broadening of claims in ancestor applications remains a problem for patent-infringement defendants.
While (1) Mr. Hyatt’s use of the patent system is unparalleled (he filed 381 placeholder applications at GATT bubble, later expanded number of claims to 115,000, delayed between 12 to 28 years (based on asserted priority dates) to present his claims for prosecution, and “adopted an approach to prosecution that all but guaranteed indefinite prosecution delay”), and (2) this panel decision is on appeal of a § 145 action against the Patent Office, the decision breathes new life into this defense by creating a presumption of intervening rights and prejudice if there were six or more years of unreasonable prosecution delay. Hyatt (Fed. Cir. 06/01/21).
Assignor Estoppel Restricted: Prohibits One in Privity With Assignor Contradicting Assignor’s Implied (or Express) Representations of Patentability, Claim by Claim
Assignor estoppel (now) ”applies when, but only when, the assignor’s claim of invalidity contradicts explicit or implicit representations he made in assigning the patent.” Minerva Surgical (U.S. 06/29/2021) (5-4), vacating Hologic (Fed. Cir. 04/22/20).
There is no contradiction (or estoppel) when (1) the “assignment occurs before an inventor can possibly make a warranty of validity as to specific patent claims” (as in assignment of future inventions in an employment agreement), (2) intervening law renders the claims invalid, or (3) later claims in a patent are “materially broader” than the claims at the time of the assignment.
Abstractness Angst When Invention Involves Physical Components of Physical Machines
Last year, it was claims directed to a “method for manufacturing a shaft assembly of a driveline system” that were declared patent ineligible, to much ridicule. See American Axle (Fed. Cir. 07/31/20) (2-1). This quarter it is claims on an improved digital camera:
Claim: “An improved digital camera comprising: a first and a second image sensor …; two lenses, each being mounted in front of one of said two image sensors; …; an analog-to-digital converting circuitry coupled to said first and said second image sensor …; an image memory, …; and a digital image processor, coupled to said image memory and receiving said first digital image and said second digital image, producing a resultant digital image from said first digital image enhanced with said second digital image.”
Ruling: Patent ineligible for being directed to abstract idea of “taking two pictures (which may be at different exposures) and using one picture to enhance the other in some way”. Yu (Fed. Cir. 06/11/21) (2-1) (aff’g R. 12(b)(6) dismissal; claims’ enhanced image is created by conventional digital camera components performing their basic functions and recited at high degree of generality, and what Spec. identifies as advance over prior art is not required by the claims).
See https://patentdefenses.klarquist.com/patent-eligible-subject-matter-sec-101/ (includes table quoting the “abstract idea” for each of 124 post-Alice Fed. Cir. opinions ruling that claims are directed to an abstract idea).
Contributory Infringement: Merely Hypothetical Non-Infringing Uses Unhelpful
Bio-Rad (Fed. Cir. 05/28/21) (aff’g contributory infringement and ITC finding that each proposed design-around is a “hypothetical system that is not yet available to 10X’s customers,” as consistent with precedent, “which focuses on the real way in which the accused product is made, used, and sold”).
Unsettled: Who Has Burden On Whether Prior Art Non-Patent Publication is Enabled?
In late June, a Fed. Cir. panel, in a non-precedential decision, declared that in the context of district court litigation, patent prosecution, and AIA trial proceedings, “prior art patents and publications enjoy a presumption of enablement, and the patentee/applicant has the burden to prove nonenablement for such prior art.” Apple (Fed. Cir. 06/23/21) (non-precedential) (PTAB (harmless) error to put burden of persuasion on challenger to prove prior art published Japanese application enabled.)
But this appears to extend prior precedents. In particular, In re Antor Media (Fed. Cir. 07/27/12) held that during patent prosecution, an Examiner may presume that a non-patent prior art publication is enabling unless shown otherwise, but its reasoning did not extend to district court litigation or even AIA trials.
Unsettled: Does AIA Trial Estoppel Arise Upon Board’s Final Written Decision or When Appeals Exhausted?
Court has not decided when AIA trial-based estoppel arises, although has held that for inter partes reexamination “whose language is similar but not identical to § 325(e)(2)—estoppel rights arose when all appellate rights were exhausted.” Olaplex (Fed. Cir. 05/06/21) (non-precedential) (aff’g application of PGR-based estoppel against written description and obviousness defenses).
Patent Defenses Q1 2021 Highlights
Williamson and Fools’ Gold: Purely Functional Claim Elements
This quarter the Federal Circuit repeatedly found indefiniteness based on claim terms triggering interpretation under section 112(f). “Means-plus-function claiming is fools gold—especially for anyone with a thin disclosure. The claims appear broad, but are narrowly interpreted and regularly invalidated.” Crouch, Patently O (03/02/21).
- “user identification module configured to control access of . . .” Rain Computing (Fed. Cir. 03/02/21) (aff’g quoted claim element nested in method claim triggers Sec. 112(6/f) as “module” is nonce term, “user identification” describes function, “the purely functional claim language reciting what the ‘user identification module’ is configured to do provides no structure,” the claim term is not a term of art for structure, and term not used in Spec.);
- “user identifier module” Synchronoss (Fed. Cir. 02/12/21) (aff’g Summ. J. quoted claim element triggers Sec. 112(6/f), and claims indefinite);
- “wireless means of on-demand allocation of a passenger . . . ” and “wireless means of detecting the proximity of the passenger . . .” RideApp (Fed. Cir. 03/25/21) (non-precedential) (aff’g Markman ruling of indefiniteness because Spec. did not “describe how the system analyzes different passenger transportation requests and vehicle availability to assign a particular route or vehicle to a given user”).
Nautilus: So Many Ways to Be Unclear
Post-Nautilus, the Federal Circuit has found patent claims “indefinite” for a wide range of reasons, including this quarter.
- Unclear boundary between two elements: Infinity Computer (Fed. Cir. 02/10/21) (aff’g indefiniteness ruling at Markman hearing of “passive link” (not used in Spec.) and “computer” in “via a passive link between the facsimile machine and the computer,” for a lack of reasonable certainty as to where passive link ends and computer begins, ivo applicants’ plainly inconsistent positions in original prosecution and reexamination proceedings on another patent in family);
- Unclear how to measure compliance: Saso Golf (Fed. Cir. 02/10/21) (non-precedential) (aff’g indefiniteness of claim’s description of shape of golf club head as skilled artisan would not know where to make measurements for applying claimed formula; no clear error in finding of fact that an artisan would not know the precise bounds of the toe and heel of a golf club);
- Nonsensical claims: Synchronoss (Fed. Cir. 02/12/21) (aff’g Summ. J. indefiniteness of claims reciting a single file comprising a directory of multiple files as claiming an impossibility rendering them nonsensical); Horizon Pharma. (Fed. Cir. 01/06/21) (non-precedential) (aff’g Summ. J. indefiniteness; meaning of “target” (in “the AM and PM unit dose forms target . . .”) is unambiguous: “set as a goal,” which renders claim nonsensical because “reading the claim literally, a dose form, which is an inanimate object, cannot set a goal,” despite cursory conclusion by expert as to how skilled artisan would understand term).
Intersection of PTAB Decision and Defenses in Court
Particularly since the PTAB adopted the Phillips claim construction standard, petitioners for PTAB review need to worry about judicial estoppel and issue preclusion in addition to statutory estoppel arising from a Final Written Decision in the PTAB. The first case below removes one cause for concern while the second reinforces the risk of issue preclusion (despite applying issue preclusion to a second PTAB proceeding).
- Final Written Decision Declining To Decide Prior Art Invalidity Due To Indefiniteness Not Likely To Create Estoppel: Dictum: “To be clear, in cases in which the Board cannot reach a final decision as to the patentability of certain claims because it cannot ascertain the scope of those claims with reasonable certainty, the petitioner would not be estopped by 35 U.S.C. § 315(e) from challenging those claims under sections 102 or 103 in other proceedings.” Samsung (Fed. Cir. 02/04/20).
- Issue Preclusion (Collateral Estoppel): Same Issue: Synqor (Fed. Cir. 02/21/21) (2-1) (applying issue preclusion to reverse PTAB finding of obviousness in inter partes reexamination (based on finding motivation to combine two references and finding the references were not incompatible) based on another PTAB ruling in inter partes reexamination initiated by same petitioner of different patents in same patent family, that same prior art references were incompatible and hence there was no motivation to combine).
More Examples of an “Abstract Idea”
Patent Defenses quotes the “abstract idea” to which the court found the claims directed in every post-Alice Fed. Cir. opinion finding a claim directed to an “abstract idea.” This quarter’s entries are:
|Abstract Idea Decision||“Abstract Idea” To Which Claims Directed||Ruling|
|In re Board of Trustees (Stanford) (Fed. Cir. 03/25/21) (Reyna, J.)||“mathematical calculations and statistical modeling”, specifically, a “computerized method of inferring haplotype phase in a collection of unrelated individuals”||aff’g ex parte rejection
|In re Board of Trustees (Stanford) (Fed. Cir. 03/11/21) (Reyna, J.)||“mathematically calculating alleles’ haplotype phase”||aff’g ex parte rejection
|Enco (Fed. Cir. 03/08/21) (non-precedential) (Taranto, J.)||“automating the AV-captioning process”||aff’g R. 12(b)(6)
|Veripath (Fed. Cir. 02/08/21) (non-precedential) (Lourie, J.)||“an improvement to the abstract notion of exchanging privacy for functionality that utilizes an API to achieve the desired result”||aff’g R. 12(b)(6)
|cxLoyalty (Fed. Cir. 02/08/21) (Prost, C.J.)||“facilitating, or brokering, a commercial transaction (i.e., the sale and purchase of goods and services) between a purchaser using a first form of value (i.e., a rewards program participant using points in whole or in part) and a seller transacting in a second form of value (i.e., a vendor system which transacts purchases in currency)”||aff’g PTAB ineligibility and rev’g PTAB eligibility in CBM
|In re Mohapatra (Fed. Cir. 02/05/21) (non-precedential) (Bryson, J.)||“enabling a credit card user to change the security code on the card by using a web application”||aff’g ex parte rejection
|iLife Tech. (Fed. Cir. 01/13/21) (non-precedential) (Moore, J.)||“gathering, processing, and transmitting information”||aff’g post-trial JMOL
|Boom! Payments (Fed. Cir. 01/13/21) (non-precedential) (Lourie, J.)||“payment escrow”
|aff’g R. 12(b)(6)
|In re Sturgeon (Fed. Cir. 01/12/21) (non-precedential)||“simulating a floral arrangement by creating a digital collage”||aff’g ex parte rejection
|Mortgage Application (Fed. Cir. 01/12/21) (non-precedential) (Clevenger, J.)||“information exchange in an online loan application process”
“exchanging information from XML to PDF format”
|aff’g R. 12(c)
|In re Abel (Fed. Cir. 01/07/21) (non-precedential) (Taranto, J.)||“generating a mailer defined by a set of rules for controlling the sender’s access to the receiver’s mailing address”||aff’g ex parte rejection
Assignor Estoppel Before the S. Ct.
- Broadening of claims does not negate assignor estoppel, but estopped party may introduce evidence of prior art to narrow the scope of claim “so as to bring its accused product ‘outside the scope of’” of the claim. Hologic (Fed. Cir. 04/22/20) (aff’g application of assignor estoppel), cert. granted (U.S. 01/08/2021) (Question Presented: “whether a defendant in a patent infringement action who assigned the patent, or is in privity with an assignor of the patent, may have a defense of invalidity heard on the merits.”)