25 Critical Patent Enforcement Developments

News from Chisum Patent Academy

25 Critical Patent Enforcement Developments

The Academy is pleased to announce the April 2015 publication of the annual Update for Volume II (Patent Enforcement) of the practitioner treatise, Mueller on Patent Law, authored by our co-founder, Janice M. Mueller.

The two-volume Mueller on Patent Law treatise is published by Wolters Kluwer Law & Business. Volume I (published 2012) addresses patentability, validity, and prosecution procedures; Volume II (published 2014) covers patent infringement, USPTO post-issuance procedures, design patents, and international patenting issues. For detailed tables of contents for both volumes, click here.

The full text of the 2015 Update for Volume II (Patent Enforcement) is available electronically on Wolters Kluwer’s Intelliconnect subscription platform. By examining in detail each of the cases highlighted below (plus many others), the 2015 Update adds extensive and valuable new matter to Volume II.

Highlights of the April 2015 Update for Vol. II:

Chapter 13: Jurisdiction and Procedure:

• Consumer Watchdog v. Wisconsin Alumni Research Found., 753 F.3d 1258 (Fed. Cir. 2014) (dismissing Consumer Watchdog’s appeal to Federal Circuit from USPTO inter partes reexamination decision for lack of Constitutional standing; despite right to appeal provided in 35 U.S.C. §315 (2006), Consumer Watchdog had not suffered an “injury in fact” sufficient to confer Article III standing but rather held only a “general grievance” against WARF’s human embryonic stem cell patent).

Chapter 14: Analytical Framework for Patent Infringement:

• Limelight Networks, Inc. v. Akamai Techs., Inc., 134 S. Ct. 2111 (2014) (in suit alleging divided/distributed Infringement liability by multiple actors, reversing Federal Circuit’s determination that defendant could be liable for inducing infringement even in the absence of direct infringement under 35 U.S.C. §271(a); inducing liability cannot exist without underlying direct infringement liability, but direct infringement never occurred in case at bar because “performance of all the claimed [method] steps [could] not be attributed to a single person . . . .”; inviting Circuit to revisit the “direction and control” rule of Muniauction, Inc. v. Thomson Corp., 532 F.3d 1318 (Fed. Cir. 2009), so that “on remand, the Federal Circuit will have the opportunity to revisit the § 271(a) question if it so chooses”).

Chapter 15: Patent Claim Interpretation:

• Hill-Rom Servs., Inc. v. Stryker Corp., 755 F.3d 1367 (Fed. Cir. 2014) (illustrating challenges of interpreting claim term meaning as of remote effective filing date; reversing district court’s summary judgment of no infringement based on erroneously narrow claim construction of “datalink” in patent with 1993 priority date; Circuit majority viewed “plain and ordinary meaning” of “datalink” as “any link over which data is transferred and can be wired or wireless”).
• Golden Bridge Tech., Inc. v. Apple, Inc., 758 F.3d 1362 (Fed. Cir. 2014) (affirming district court’s grant of summary judgment of no infringement; doctrine of prosecution disclaimer applied against patentee that sought broad claim interpretation in litigation; during reexamination proceeding patentee had submitted to USPTO an Information Disclosure Statement including stipulated construction of disputed claim term from earlier litigation against different defendant, which was a “clear and unmistakable assertion” by patentee of term’s scope and meaning).

Chapter 16: Comparing Properly Interpreted Claims to Accused Device:

• Ring & Pinion Serv. Inc. v. ARB Corp. Ltd., 743 F.3d 831 (Fed. Cir. 2014) (forcefully rejecting argument that foreseeability/known interchangeability bars infringement under doctrine of equivalents; parties’ stipulation of equivalency precluded district court’s erroneous conclusion that “cylinder means” claim limitation would be vitiated by finding the accused cylinder equivalent).

Chapter 17: Indirect Infringement:

• Commil USA, LLC v. Cisco Sys., Inc., 720 F.3d 1361 (Fed. Cir. 2013) (holding that evidence of a good-faith belief of patent’s invalidity may negate the intent required for §271(b) induced infringement liability), reh’g en banc denied, 737 F.3d 699 (Fed. Cir. Oct. 25, 2013) (en banc) (order) (Reyna, J., and Newman, J., dissenting); cert. granted, 135 S. Ct. 752 (Dec. 5, 2014).
• Limelight Networks, Inc. v. Akamai Techs., Inc., 134 S. Ct. 2111 (2014) (in suit alleging divided/distributed Infringement liability by multiple actors, Supreme Court rejected Federal Circuit’s reasoning that defendant could be liable for inducing infringement under 35 U.S.C. §271(b) even if no one directly infringed under §271(a); Federal Circuit lacked authority to “creat[e] for § 271(b) purposes some free-floating concept of ‘infringement’ both untethered to the statutory text and difficult for the lower courts to apply consistently”).

Chapter 18: Specialized Categories of Infringement:

• Promega Corp. v. Life Technologies Corp., 773 F.3d 1338 (Fed. Cir. 2014) (export of standard Taq polymerase needed for polymerase chain reaction (PCR) amplification, one of five components of patented kit, satisfied the “actively induce the combination” and “substantial portion of the components of a patented invention” language for infringement liability under 35 U.S.C. §271(f)(1)).

Chapter 19: Defenses to Patent Infringement:

• What are the implications for equitable defense of laches in patent cases as set forth in in A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020 (Fed. Cir. 1992) (en banc), in the wake of Supreme Court’s new copyright laches decision in Petrella v. Metro-Goldwyn-Mayer, Inc.¸ 134 S. Ct. 1962 (2014) (holding that laches cannot be invoked to preclude adjudication of a claim for damages brought within the three-year statute of limitations for copyright infringement actions set forth at 17 U.S.C. §507(b))? See SCA Hygiene Prods. Aktiebolag v. First Quality Baby Prods., LLC, No. 2013-1564, 2014 WL 7460970 (Fed. Cir. Dec. 30, 2014) (granting rehearing en banc and vacating panel opinion in SCA Hygiene Prods. Aktiebolag v. First Quality Baby Prods., LLC, 767 F.3d 1339 (Fed. Cir. 2014) (holding that Petrella did not change the law set forth for patent laches in Aukerman)).
• Patent Licensing/Misuse Defense: Will the Supreme Court overrule Brulotte v. Thys Co., 85 S. Ct. 176 (1964) (prohibiting post-patent expiration royalties)? See Kimble v. Marvel Enterprises, Inc. (9th Cir. 2013) (“reluctantly” applying Brulotte to hold that a hybrid licensing agreement encompassing inseparable patent and non-patent rights was unenforceable beyond the expiration date of the underlying patent), cert. granted, Kimble v. Marvel Enterprises, Inc., 135 S. Ct. 781 (Dec. 12, 2014).
• American Calcar, Inc. v. American Honda Motor Co., Inc., 768 F.3d 1185 (Fed. Cir. 2014) (“Calcar IV”) (affirming that patents in suit were unenforceable for inequitable conduct under the heightened Therasense standard for materiality (as well as intent)).
• Apotex, Inc. v. UCB, Inc., 763 F.3d 1354 (Fed. Cir. 2014) (affirming that patentee had committed inequitable conduct by “crossing the line” between advocating in good faith a reasonable, legitimate interpretation of the prior art, and affirmatively and knowingly misrepresenting material facts about that art).

Chapter 20: Remedies for Patent Infringement:

• In two important and unanimous companion decisions, Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749 (2014) and Highmark Inc. v. AllCare Health Management Sys., Inc., 134 S. Ct. 1744 (2014) (“Highmark III”), the Supreme Court jettisoned as “overly rigid” the Federal Circuit’s restrictive Brooks Furniture standard for district court determinations of “exceptional”ness under 35 U.S.C. §285 and reemphasized the courts’ discretion in assessing attorney fee awards.
• Apple, Inc. v. Motorola, Inc., 757 F.3d 1286 (Fed. Cir. 2014) (affirming determination that owner of an infringed, standard essential patent (“SEP”) subject to licensing on fair, reasonable, and nondiscriminatory (“FRAND”) terms was not entitled to a permanent injunction; SEP owner had not shown it would be irreparably harmed absent the injunction, or that money damages would be inadequate to compensate for the infringement).
• Trebro Manufacturing v. Firefly Equipment, 748 F.3d 1159 (Fed. Cir. 2014) (vacating district court’s denial of patentee’s motion for preliminary injunction; potential irreparable harm to patentee in “tiny” market was “real,” not speculative).
• VirnetX, Inc. v. Cisco Sys., Inc., 767 F.3d 1308 (Fed. Cir. 2014) (holding that district court had reversibly erred when instructing a jury concerning entire market value rule and setting a royalty base equal to the “smallest salable unit containing the patented feature,” because “a patentee’s obligation to apportion damages only to the patented features does not end with the identification of the smallest salable unit if that unit still contains significant unpatented features”; accused Apple servers running Facetime video calling program contained “vast” number of unpatented features).
• VirnetX, Inc. v. Cisco Sys., Inc., 767 F.3d 1308 (Fed. Cir. 2014) (rejecting reliance on Nash Bargaining Solution as tool for estimating reasonable royalty damages; theory that the incremental profits be split 50/50, even though adjusted to account for certain circumstances of case at bar, was “insufficiently tied to the facts of the case, and [could] not be supported”).
• SSL Servs., LLC v. Citrix Sys., Inc., 769 F.3d 1073 (Fed. Cir. 2014) (holding that district court should have designated patentee SSL as the “prevailing party” for purposes of awarding attorney fees and costs; despite “some success” by accused infringer Citrix in defending against some of SSL’s claims, SSL received a judgment for damages against Citrix, which was “actual relief on the merits of [SSL’s] claim [that] materially alter[ed] the legal relationship between the parties by modifying the defendant’s behavior in a way that directly benefit[ed] the plaintiff”).

Chapter 21: Correcting Issued Patents in the USPTO (Reissue and Reexamination):

• Antares Pharma, Inc. v. Medac Pharma Inc., 771 F.3d 1354 (Fed. Cir. 2014) (questioning traditional understanding that “same invention” requirement for reissue under 35 U.S.C. §251 is coextensive with satisfying disclosure requirements of 35 U.S.C. §112; holding that asserted claims of Antares’ reissue patent failed reissue statute’s “original patent requirement” because specification did not “clearly and unequivocally disclose the newly claimed invention as a separate invention”).
• Japanese Foundation for Cancer Research v. Lee, 773 F.3d 1300 (Fed. Cir. 2014) (vacating district court’s order for withdrawal of an unauthorized statutory terminal disclaimer filed by patent owner’s attorney of record; concluding that USPTO did not have either statutory or inherent authority to withdraw the terminal disclaimer, which complied with USPTO regulations; patent could not be restored; if patentee had any remedy, it would lie in malpractice).

Chapter 22: Challenging Patents in the USPTO (AIA-Implemented Procedures):

• Statistical update: two-year snapshot of AIA post-grant procedures including rapidly increasing number of inter partes reviews and high patent “kill rate.”
• Controversial “broadest reasonable construction” rule applied by PTAB for claim interpretation in post-grant procedures despite minimal opportunity to amend claims.
• VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307 (Fed. Cir. 2014) (holding that district court abused its discretion in denying accused infringers’ patent litigation stay request in view of parallel TPCBM proceeding under AIA §18; determining that three of four statutory factors—i.e., simplification of issues and streamlining of trial, whether discovery was complete and a trial date had been set, and reduction of the burden of litigation on parties and court—weighed “heavily” in favor of stay).
• Versata Software, Inc. v. Callidus Software, Inc., 771 F.3d 1368 (Fed. Cir. Nov. 20, 2014) (second 2014 Federal Circuit decision reversing a district court’s denial of patent litigation stay request in view of a parallel TPCBM proceeding.); opinion vacated and appeal dismissed, Versata Software, Inc. v. Callidus Software, Inc., No. 2014-1468, 2015 WL 981523 (Fed. Cir. Feb. 27, 2015) (concluding that “parties’ voluntary and unconditional dismissal mooted the appeal before the release of our prior [Nov. 20, 2014] opinion”).

Chapter 23: Design Patents:

• Pacific Coast Marine Windshields Ltd. v. Malibu Boats, LLC, 739 F.3d 694 (Fed. Cir. 2014) (in case of first impression, holding that principles of prosecution history estoppel can apply to design patents as well as utility patents, but nevertheless reversing district court’s grant of summary judgment of no infringement; design applicant’s response to USPTO restriction requirement did not necessarily bar its infringement claim because accused design was not within scope of surrendered subject matter).

Chapter 24: Plant Patents:

• Delano Farms Co. v. California Table Grape Comm’n, 778 F.3d 1243 (Fed. Cir. Jan. 9, 2015) (affirming district court’s judgment sustaining validity of challenged plant patents; actions of third party individuals (non-inventors) who obtained samples of unreleased but later-patented table grape varieties from the government and planted them in their own fields did not constitute a §102(b) invalidating public use).

Chapter 25: International Patenting Issues:

• General updates; status of European Union Unified Patent System and Unitary Patent Court.

About the Author:

Janice M. Mueller is a registered U.S. patent attorney and chemical engineer. She was the first woman to serve as a judicial law clerk for Judge Giles S. Rich, U.S. Court of Appeals for the Federal Circuit, from 1990-1992. Janice litigated patent and copyright infringement cases as an Honors Program Trial Attorney in the U.S. Department of Justice before entering legal academia. From 2004-2011 Janice was a tenured full Professor at the University of Pittsburgh School of Law, where she taught and wrote in the field of intellectual property law with an emphasis in U.S. and comparative patent law. Janice has also taught at John Marshall Law School (Chicago), Suffolk University (Boston), the University of Kentucky, the University of Washington, Seattle University, Santa Clara University, and William Mitchell College of Law (St. Paul). Aspen Publishers issued the fourth edition of her popular student text, Patent Law, in 2013. Janice’s scholarly articles have been published in Baylor Law Review, Berkeley Technology Law Journal, Houston Law Review, Journal of the Patent and Trademark Office Society, Kentucky Law Journal, University of Pittsburgh Law Review, and Washington Law Review. In 2009 Janice co-founded with Donald S. Chisum the Chisum Patent Academy, which provides patent law educational services in a unique small-group seminar format. Janice has served on the American Intellectual Property Law Association’s Amicus Committee, lectured for BarBri Patent Bar Review, chaired the Expert Advisory Committee on Intellectual Property for the Consultative Group on International Agricultural Research, and is a trustee of the Federal Circuit Historical Society.