Patent Law A. Once issued, patentee can bring suit for infringement. Typically two defenses to this: a. Accused infringer will argue that patentee’s patent is invalid for any number of reasons b. Even if patent valid, products being made or sold by accused do not infringe. B. Requirements for Patentability a. The Patent and Trademark Office (PTO) reviews each patent application to see if it meets five requirements: i. An invention fits one of the general categories of patentable subject matter 1. Novelty: It has not been preceded in identical form in the public prior art. a. Is established by applying a set of technical rules to determine if a patent applicant was really the first to make the invention she is claiming. b. The novelty test determines whether the claimed invention is unpatentable because it was made before, sold more than a year before a patent application was filed, or otherwise disqualified by prior use or knowledge. 2. Utility: It is useful. a. Minimal obstacle to obtaining a patent. b. §101: “whoever invents any new and useful process, machine, manufacture, or composition of matter, may obtain a patent therefore” c. Patent won’t be withheld even if invention works only in experimental setting/has no proven use in field or factory. Only denied if has absolutely no practical utility. Pharmaceuticals an exception—some cases say laboratory promise not enough to establish utility in treating humans. 3. Nonobviousness: It represents a nontrivial extension of what was known a. The most important requirement. “the ultimate condition of patentability.” b. Attempts to measure more abstract quality: the technical accomplishment reflected in an invention. c. Is the invention a big enough technical advance over the prior art? Even if new and useful, not patentable if merely trivial step forward in the art. 4. Enablement: It is disclosed and described by the applicant in a such a way as to enable others to make and use the invention a. Requires patentee to give sufficiently good description of her invention so that “one of ordinary skill in the art” would be able to make and use the invention. b. Concern not whether inventor developed something worth patenting but public benefit that can be obtained from the patent “bargain.” Disclosure and enablement requirements ensure that those skilled in the art of the invention can read and understand the patentee’s contribution and that after the patent expires they will be able to make and use the invention themselves. 5.The material is patentable subject matter. (Dealt with on page ) B. Rights Conferred by a Patent b. Claims are at the heart of patent law. They define the boundaries (metes and bounds) of the property right that the patent confers. Claims come at the end of the written description of the invention. Most patents have one or more drawings. i. Claims section often begins w/broadest, which is then qualified by series of dependent ones. Then perhaps narrower independent, then maybe qualified by series of dependent. Generally structure of inverted pyramid. c. The Specification describes the invention. It names all the parts of components of the invention, describes how they work, and illustrates how they work together, describes how they work, and illustrates how they work together to perform the invention’s function. Only at the end of the specification does the inventor state the precise legal definition of the invention. These are the claims. i. Independent Claims: do not refer to any other claims ii. Dependent Claims: incorporates all the limitations of the independent claim on which it depends (see example p. 113). i.e. “according to claim 4” iii. Specialized claim formats – “means plus function” format: the claim is not described in detail but is merely listed as a means for accomplishing some goal. iv. Patent confers the right to exclude others from making, using, selling, offering for sale, or importing the claimed invention for a specific term of years. v. Till 1995, term was 17 yrs from date patent issued. Now 20 years from date patent app filed. The length under new law varies from case to case—a patent is in force for 20 years minus the amount of time the patent spent in the application or “prosecution” process. d. The exclusionary right is a negative right for two reasons: i. Patent does not automatically grant an affirmative right to do anything; patented pharmaceuticals for instance, must still pass FDA’s regulatory review to be sold legally. ii. A patented invention may itself be covered by a preexisting patent/For instance, a broad pioneering patent on a product or process may cover later-developed inventions that are themselves patented as improvements. In such a case, the holder of improvement patent has right to exclude everyone form her improvement (including broad patent holder) while at same time barred from use of improvement herself unless holder of broad patent authorizes. Patents so related are “blocking patents.” C. Note on the Procedures for Obtaining a Patent a. Process of obtaining patent from PTO is known as “prosecution.” b. Time and effort to prosecute varies greatly from case to case. c. Estimate is that over course of prosecution, typical patent receives only 18 hrs of attention. d. Prosecution begins with filing of patent app. Can file temporary “placeholder” app, called a provisional app, but must be converted into standard app w/in a year. 35 U.S.C. § 111(b). e. Basics of an application: i. The specification, including summary of invention and drawings in most cases ii. One or more claims at the end of the specification iii. An oath declaring inventor(s) actually invented what is described in the specification iv. Applicable filing fees 1. When app received, assigned to one of 17 main examining groups, then to specific art unit that specializes in relevant technology, an then to one of the 3400 patent examiners. 2. Usu 12 months or more till examiner gets app; handled in order received. In this period, can file additional papers like information disclosure statement (IDS) which describes prior art known to applicant at time of filing; preliminary amendments, which are changes made to app before examiner’s first response or “office action.” 3. Examiners usually make initial review, including search of prior art. Usu next office action is rejection of most of the claims in the app on grounds of lack of novelty or nonobviousness. 4. Examiner must state reasons for each rejection, together with information and references to aid the applicant in judging the desirability of continuing prosecution or overcoming the rejection. 35 U.S.C. § 132. Examiner has burden to show why an app should not issue as a patent. In response the applicant can either contest (aka “traverse”) the rejection or acquiesce in it. 5. Aside from rejection, examiner can issue “objection” which notes problems of form rather than substance in the app. Most common of these is a “restriction requirement” which is used when app has claimed more than one distinct invention in a single app, a violation of § 121 of the Patent Act. In response applicant can “elect” some claims from the initial application and continue prosecuting them. Others can be split into separate app a/k/a “divisional application” which retains priority date of initial filing but becomes separate. 6. Generally, apps can be amended liberally during prosecution. Most common reason is response to rejection or office action. Can also correct mistakes, add or change drawings, and update disclosure portion of the specification. Standard amendments usu permitted up to time of final rejection. 7. Final rejection is misnomer. Can respond to in several ways, usu continuation or amendment after final rejection under 37 C.F.R. §1.116; can also appeal to Board of Patent Appeals and Interferences an admin tribunal w/in PTO if feels that continued prosecution would not be worthwhile. a. Continuation is basically a new version of app. See footnote p. 116 for types of continuations. Filing one resets examination process w/out having to wait a year for a response (they receive priority in processing). b. Simple continuation app retains benefit of initial app’s filing date; it therefore may serve much the same role as an amendment. c. A continuation in part (CIP) by contrast adds new matter to specification. This does not retains the benefit of earlier filing date, but any info carried over from orig filing does. 8. A variation on the continuation theme—take bird in hand and fight contested claims separately. Filing amendment after final rejection canceling rejected claims achieves this. Puts remaining claims in condition for allowance while rejected claims can be carried over into separate continuation app. Can go fight these later. Acceptable claims become enforceable as soon as original slimmed down app is allowed to issue as patent. a. Other objectives of continuations include: b. important inventions, file one just prior to issue of patent so prosecution based on original disclosure may continue (valuable where a competitor may attempt to design around patent by adopting minor variants—can revise cont. app. To cover new variant—CIP if some matter added) c. in addition to various filings applicants can communicate with patent examiners by phone or in person through examiner interview. Notes made here= part of prosecution history or file wrapper, and maybe held against you possibly. d. Since 2001, patent apps published. American Inventors Protection Act of 1999 (35 U.S.C § 122(b))all apps that cover inventions that will be subject of foreign apps published 18 mos after filing date. Where applicant interested only in U.S. patent, not published. e. After publication but before issue of patentf. Once issued, patentee can bring suit for infringement. Typically two defenses to this: i. Accused infringer will argue that patentee’s patent is invalid for any number of reasons ii. Even if patent valid, products being made or sold by accused do not infringe. 9. Standard of review of Patent Office’s decision to issue contentious. But no doubt that patent “born valid,” the Patent Act includes a “presumption of validity” that accompanies any issued patent. (35 U.S.C. § 282). Appeals in infringement cases go automatically to Court of Appeals for the Federal Circuit, regardless of district case filed in. a. 3 other forms of patent litigation: b. Priority dispute between 2 or more inventors, all of whom claim to have been the first. Known as interference proceedings. U.S. awards patent to first inventor, every other country awards to first to file. These proceedings are handled by the PTO internally through Board of Patent Appeals and Interferences. Appealed to CAFC. c. Declaratory judgment actions by people who reasonable fear being sued for infringement. Such actions usually met w/counterclaims charging infringement, suit proceeds like infringement suit. d. International Trade Commission has jx to block importation of products into U.S. that infringe U.S. patents/importation of products made abroad by processes patented in U.S. Patent owners can complain to ITC, will bring §337 actions. Have own set of proced rules that operate parallel to district court actions for patent infringement. f. Theories of Patent Law i. Central theory is that inventions are public goods that are costly to make and difficult to control once released into world. Absent patents inventors will not have sufficient incentive to invest in creating, developing, and marketing new products. Patent law provides marketdriive incentive to invest in innovation by allowing inventor to appropriate full economic rewards of her invention. D. The Elements of Patentability (1) patentable subject matter, (2) novelty, (3) utility, (4) nonobviousness, (5) enablement a. Patentable Subject Matter: § 101 determines which types of inventions will be considered for patent protection. Defines broadly: “any…process, machine, manufacture, …composition of matter, or …improvement thereof.” Lawyers often distinguish between process claims and product claims (machine, manufacture, composition of matter). i. Diamond v. Chakrabarty: Can living things be patented? The court held that respondent's micro-organism constituted a "manufacture" or a "composition of matter" within the meaning of 35 U.S.C.S. § 101 and thus qualified as patentable subject matter because it was a new bacterium with markedly different characteristics from any found in nature and which had the potential for significant utility. The court held that the language of 35 U.S.C.S. § 101 embraced respondent's invention. 1. Discovery versus invention Court cites Funk Brothers case which involved patent for bacteria that assists in process of nitrogen fixation in the roots of plants. The invention underlying the patent was said to be the realization that different species of bacteria could be mixed together and sold in single formula which experts previously believed was not possible. SC said this was a discovery, not an invention. “it is no more than the discovery of the handiwork of nature and hence is not patentable.” Chakrabarty distinguishable because of line between discovery and invention—emphasizes transformation inventor makes on admittedly natural raw materials of invention. Funk Bros. emph the bacteria, although combined in novel way, still perform their sam old natural function. But see 35 U.S.C. § 100, which provides that invention as the term is used in Patent Act means both “invention and discovery.” ii. Parke-Davis & Co. v. H.K. Mulford Co.: involved a substance that was isolate from the glands of animals for medical use—where an inventor has found a way to extract/purify a naturally created substance so that it is commercially valuable= an important doctrinal element today. Judge held that this was a patentable invention. 1. notes talk about similar but distinguishable cases. Courts have rejected isolating tungsten and tree tissue. 2. the rationale for Parke-Davis is a variation on the rule that properties of nature can be patented because they are unusable in their natural form. This the law of biotechnology in the U.S. This applies to human body parts and genetic sequences. The utility doctrine constrains this—must show a specific, known utility to, say, the gene sequence. 3. Harvard Mouse Case: a patent was issued for a genetic sequence that produces different cancer susceptible mouse when introduced. This included the mouse itself (the product). Canada rejected because couldn’t describe what cause mouse to do this. iii. Note on Patenting “Abstract Ideas”: SC talked about Einstein’s theory of relativity. Laws of physics are unpatentable. So are algorithms that are not reduced to a specific function. Morse was granted a patent for the telegraph process but was denied patent for the use of electromagnetism. There is a rule against patenting abstract ideas. Devices which make the abstract idea useful or practical are patentable. Morse overbroad for claiming for use of electromagnetism. Overbroad because not claiming a specific invention. Not reproducible—describing broad filed of technology but not telling how to make the invention (which is what you want to do). An example is using genetic sequencing to create a new form of plant with specific properties. Will claim for a broad genus. Unless you can show specific properties with respect to a specific plant, won’t get patent. Have to enable across field of technology. iv. Note on Patenting Business Methods and “Printed Matter” State Street: business program for pricing mutual funds by taking prices of components of pool/yielding single price for unit of value. Basically multiplication and division. Long standing doctrine precluded patenting business methods. CAFC said here there was no reason to do this. You can patent inventory control methods such as Merrill-Lynch’s single source checking acct Prior art: body of existing knowledge. Patent examiners don’t have scientific journals to look to for explanations of these things. This is a big burden on the patent office. Had to be a physical means for carrying out, not printed matter, but the printed matter doctrine has also disappeared. b. Utility i. Brenner v. Manson: Manson developed a kind of steroid. Was similar kind found to be useful. Had no use yet for this one, but assumed based on close relation to another steroid that had tumor inhibiting effects. Very slightly different structure but essentially the same. Claimed utility is that it could be used in testing because of similar compound’s effect. Useful to experiments because of known similarity. Court said that was not adequate. Known to be substantial unpredictability in this field. Just because can do something to A, it doesn’t follow that B will be useful. 1. quid pro quo: basic one contemplated by Constitution and Congress for granting patent monopoly is the benefit derived by the public from and invention with substantial utility— where specific benefit exists in currently available form there is insufficient justification for permitting an applicant to engross what may prove to be a broad field. 2. dissent: finds majority troubling b/c discouraging chemical research. Says need to grant patent at early stage so people will invest in researchpublic benefit. C/a is that scientific community as a whole would be prevented from using if patent was granted—it may not be researched or developed by the patent holder. 3. Concept of a “use patent”—dissent in Brenner said inventor has patent for product has right to exclude all others from making, using, or selling that product for any and all purposes, including purposes that the inventor did not herself discover or invent. The U.S. allows patenting of new uses of known compounds. Use patents a/k/a process patents. i.e. AZT was for cancer, later found to be good to treat AIDS, or Viagra, which was heart drug that treats impotence. 4. At what stage is utility demonstrated? FDA approval is not a prerequisite for finding utility. This is because it could hinder research and development. Costs of Phase II testing would discourage this. No incentive to do clinical testing if these costs are expended without securing w/out securing the monopoly. Only blocking competition will encourage investment in clinical trial. U.S. has patent term extension— give more time to compensate for that lost in FDA approval. Arg against granting w/out showing of specific utility—drug companies keep patenting then marketing inconsequential changes (“evergreening”), argument should require FDA to certify utility before granting new patent. ii. Note on Different Types of Utility 1. general: whether an invention is operable or capable of any use. The inquiry here is whether the invention as claimed can really do anything. 2. specific: whether the invention works to solve the problem it is designed to solve. The focus here is on the operability of the invention to serve its intended purpose. 3. beneficial or moral: whether the intended purpose of the invention has some minimum social benefit, or at least is not completely harmful or deleterious. If the invention does what it is supposed to, is that something that society wants done? a. Machine looks like making fresh OJ but not really. Arg for rejection is that not useful, but made to deceive public. Court says patent office couldn’t reject. This is marketing device designed to make appear more desirable than it may in fact be. C/a is that this is distinguishable from CZ or seamed stockings. Know what you’re getting there. Think this is fresh oj, its not. But, the job of the PTO is to determine if an invention, not to assign value. FTC, FDA, etc can remove from market. Not P.T.O.’s job to worry about consumer being fooled. iii. Note on Patent Office Utility Guidelines 1. PTO has promulgated guidelines for determining specifc utility of invention. Require that asserted utility be “specific, credible, and substantial.” The credibility element was well known as basis of utility rejections for far-fetched inventions. Novel aspects were specific and substantial requirements. a. Examples of insubstantial utility include using an expensive transgenic mouse as snake food and use of a laboratory derived protein as a shampoo ingredient. b. Tension between leaving things in common and private use. Which allows for more commercially useful stuff? c. Novelty and Statutory Bars i. 35 U.S.C. § 102. Conditions for Patentability; Novelty and Loss of Right to Patent 1. standards for novelty differ depending on if info was disclosed in U.S or abroad. Known/used in U.S. can defeat novelty. Higher standard for things disclosed abroad—need written docs like patent or publication. Pure protectionism or is there a rational basis? It’s hard to be aware of prior disclosures all over the world. (it’s also pretty hard to do this within the U.S). Rational basis for this is evidentiary. It’s too hard to deal with evidence of things that occurred abroad. We’re not prepared to entertain trials about what might have been said overseas—too many problems of proof. 102(a)= novelty. 102(b)= statutory bars. Statutory bars allow patent applicant to have publicly disclosed invention within one year of filing app., if waits longer, loses. A 1 yr grace period after first public disclosure. ii. The Nature of Novelty 1. Rosaire v. National Lead Co.: Can work done openly without concealment be public use or must it be specifically disseminated to the public? It isn’t necessary to actively take steps; it’s enough that is was done where public could’ve seen the invention and no steps were taken to suppress the invention. Mere oral testimony is not enough to invalidate the patent on the basis of prior use. Must have more evidentiary support. Think documentary evidence. 2. Note on the Inherency Doctrine: a. Section 102 (a) provides that an applicant is not entitled to a patent if her invention was known or used by others prior to the date of the applicant’s invention. The meaning of this phrase has been called into question in a series of cases involving unintended “accidental” anticipation of an invention. Most of these cases involve the inherent unintended production of a particular physical product a chemical process. When an inventor later intentionally makes the product, presumably because she has some use for it, the prior unintended production of the product may be raised as prior art to the invention. i. One line of cases holds that where the first, accidental producer was not aware of the product and did not attempt to produce it, the first production did not bar a patent on the invention of the product. ii. Another line holds that if a product is known in the art already, an inventor cannot obtain a patent on the product merely by putting it to a new use even if the new result had not before been contemplated. However, the inventor could obtain a patent on the new process using that product. – What about Viagra? d. Statutory Bars: Publications i. One difference between statutory bars and novelty is that an inventor can create a statutory bar by her own actions (i.e. publication of article) whereas she can’t destroy novelty of own inventions— inventor’s own work cannot be cited against her under 102 (a), but it can be under 102 (b). ii. In re Hall: The one copy of a thesis in a library aborad is sufficient and constitutes a printed publication. Where librarian couldn’t verify that the thesis had been published and available at the library, testimony about the usual process was sufficient. The statutory bar forces would be patentees to act with diligence after publishing. Peer review submissions do not count as making the publication available to the public. { Appellant applied for reissue of a patent. The application included, in an appendix, a copy of a doctoral thesis that was found to have been available as a printed publication more than one year prior to the application's filing date. Based principally on the printed publication bar under 35 U.S.C.S. § 102(b), the application was rejected. The board of appeals sustained the rejection and appellant sought review. On appeal, the court affirmed and held that evidence in the record established a prima facie case for unpatentability of the claims under § 102(b) and that the evidence was unrebutted. The court also held that the evidence showed that the doctoral thesis at issue was available as a printed publication under the applicable statute and that a single catalogued copy constituted sufficient accessibility under the statute.} iii. Statutory Bars: Public Use 1. Egbert v. Lippmann: The Court held on review that, under 5 Stat. 117, ch. 357 (1836), if an invention was in public use for more than two years prior to the patent application, with the consent and allowance of the inventor, the effect was to render the letters-patent invalid. To establish such public use it was not necessary that more than one of the patented articles be publicly used, nor did public use necessarily depend upon the number of persons to whom the articles' use was known. Where evidence established that the original inventor made public use of the invention, presented samples of invention to others, and imposed no obligation or restriction of secrecy when samples were not presented for purposes of experiment, and when public use the invention was complete, such evidence was competent to establish public use under 5 Stat. 117, ch. 357 (1836). Further, because the original inventor slept on his rights for 11 years while the invention made its way into almost universal public use, abandonment of the invention could be inferred from the conduct of the inventor. iv. The Experimental Use Exception: 1. City of Elizabeth v. Pavement Co.: The patent infringement suit was brought by appellee, a patent holder for a type of wooden pavement, against appellants, a city, an individual, and a corporation. Appellant city contracted with appellant corporation to construct wooden pavements but claimed that what was constructed did not infringe on appellee's patent. The court below ruled in favor of appellee and entered a decree against all appellants. On appeal, appellants claimed that appellee's invention had no novelty. The Court disagreed and found that none of the similar patents appellants referenced combined all the elements of appellee's, much less exhibited a combination of those elements arranged according to his plan. The Court also found that appellee's experimental use of his pavement prior to obtaining a patent did not constitute public use within the meaning of patent law. Accordingly, the Court affirmed the lower court's finding of infringement, but reversed the court's assessment of profits against appellant city and appellant individual. Because only appellant corporation made profit by construction of the pavement in question, the Court ordered that the decree below be amended to conform with its ruling. e. Priority Rules and the First to Invent i. 35 U.S.C. § 102 (g). Novelty and Loss of Right. 1. 102(g)(1) covers interference proceedings: formal priority contests between rival claimants to the same patentable subject matter 2. 102(g)(2) covers the use of prior inventions as a source of prior art. Can be invoked outside interference context—i.e. defendant in an infringement suit points to 3rd partys prior invention as prior art reference to defeat validity of P’s patent. 3. Major difference between them is territorial scope. Key phrases are “to the extent permitted in section 104” in (g)(1) and “in this country” in (g)(2). § 104 allows proof of prior inventions in any country that is signatory to WTO, so under (g)(1) inventors from any WTO country can introduce evidence of prior invention. Under (g)(2) only evidence of prior inventions made in the U.S. may be introduced outside the interference context. 4. Basic rule of priority are the same. Generally goes first to the inventor to a. Reduce an invention to practice without b. Abandoning the invention. 5. Filing a valid, enabling patent application constitutes a constructive reduction to practice. Exception to this—if first conceiver was diligent in reducing to practice (diligence measured from time just prior to second conceiver’s reduction to practice) then priority may be retained. 6. Griffith v. Kanamaru: Centers on last sentence of 102(g)— “reasonable diligence of one who was first to conceive but last to reduce to practice.” Appellant was a university professor who alleged that he had the earliest conception of technology for which appellees had filed a patent application. Appellant claimed that he delayed in reducing to practice and filing because of the university's requirement that outside funding sources be sought and to await the availability of a particular student. The Board of Patent Appeals and Interferences ruled that these excuses did not show reasonable diligence required by the exception to the first-in-time rule provided by 35 U.S.C.S. § 102(g). The court affirmed, saying that waiting for a particular graduate student was not justification because there was no showing that there was a shortage of personnel or that that individual was uniquely qualified. Nor was there a showing that appellant lacked funding, only that the university required him to pursue outside sources of funding. The court said that this was not a "hardship" case, but rather, it was similar to delay caused by desire to find a more commercially profitable form of development. The court also found that appellant had interrupted work on this project to pursue other projects and grant writing. f. Note on the GATT Amendments i. 1994, U.S. made changes in domestic patent law after negotiations under General Agreement on Trade and Tarrifs. 1994 GATT agreement known as “Trade-Related Aspects of Intellectual Property” or TRIPS. ii. Patent term changed to 20 years from date of filing of app. 35 U.S.C. § 154. Term can be extended for up to five years under circumstances such as interferences and appealed rejections. §154(b). iii. WTO members may introduce evidence of pre-patent filing inventive acts in home country for est. entitlement to patent under U>S> first to invent system. 35 U.S.C. § 104. iv. Definition of infringement expanded to include acts of unauthorized offering for sale and importing. (old only had acts of making, using, and selling). 35 U.S.C. § 271 v. Added provisional applications. 35 U.S.C. §111. must be fully enabling under §112, but does not have to include any claims. Brief description and drawing suffice to establish applicant’s priority provided more complete application filed within one year. 1. Note on the American Inventors Protection Act a. AIPA of 1999 made number of substantive changes to U.S. patent law, the most important of which were: b. Prior user rights for business method inventions only, protecting prior inventors from a later, valid patent. 35 U.S.C. § 273. i. Publication of most U.S. patent apps 18 months after filing; applications without foreign counterpart (only U.S. protection sought, are exempt. 35 U.S.C. § 122(b). ii. Expanded patent reexamination procedures permitting more 3rd party participation—large caveat though—full res judicata effect for all issues covered in the reexamination, which is expected to make this change useless. 35 U.S.C. § 311 et seq. g. Non-Obviousness i. Graham v. John Deere Co.: {While the ultimate question of patent validity is one of law, the condition set forth in the Patent Act of 1952, 35 U.S.C.S. § 103, which is but one of three conditions, each of which must be satisfied, lends itself to several basic factual inquiries: (1) the scope and content of the prior art are to be determined; (2) differences between the prior art and the claims at issue are to be ascertained, and (3) the level of ordinary skill in the pertinent art resolved. Against this background, the obviousness or nonobviousness of the subject matter is determined. Such secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc., might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented. As indicia of obviousness or nonobviousness, these inquiries may have relevancy Patents are industrial policy instruments intended to balance society’s interest in obtaining new inventions with public access to knowledge. Patents are not merely an inherent property right. Industrial and social policy instrument reflecting a balance in interests. Today there is a landrush to claim every idea one can imagine. U.S. has gone away from the Jeffersonian idea that we’ll improve with higher dissemination of knowledge. Concepts have historically fluctuated between high and low protection modes. In this case, the court says the statutory test for obviousness is nothing new, the same standard the judiciary has had for a long time. Cites Hotchkiss test. Difficult to formulate, but tries to set out some rules. Talks about multipaar test for determining if something is obvious. a) what went before—scope and content of prior art b) difference between prior art and this invention c) level of skill of someone with ordinary knowledge in that art—how much would they know? d) Secondary considerations a. Commercial success i. If more people buy, then must be a significant improvement b. Failure of others i. If others in the art had tried but couldn’t create such an invention c. Longfelt but unmet needs i. If lots of farmers kept breaking plows, people would have solved before if they could have. Why do we require distance between prior art and the claimed invention? People should earn their rewards—don’t want to frivolously grant prizes because it imposes limitations on the public. . ii. Note on prosecution history following John Deere: used to be called “file wrapper” iii. Note 3. new compositions of matter w/biotech process—specific process and compound are separately patentable. Patentable even if incorporate steps of generally known processes. iv. Combining References 1. In re Vaeck: claimed invention is algae that kills mosquitoes in swamps when they eat it. Patent office said obvious to one of ordinary skill. Acknowledged differences in proteins but mechanism for coating already disclosed, so is using host to accelerate expression. Court says prior art—2 part test p. 185-186: 1) whether the prior art would have suggested to those of ordinary skill in the art that they should make the claimed composition or device or carry out the claimed process and 2) whether the prior art would also have revealed that in so making or carrying out, those of ordinary skill would have a reasonable expectation of success. Both the suggestion and the reasonable expectation of success must be founded in the prior art, not in the applicant’s disclosure. Both suggestion and the reasonable expectation of success must be founded in prior art not in the applicant’s disclosure. Top p. 186. Not clear that would work by combining specific elements. That is nonobvious invention. 2. In re Dembiczak: Trying to patent trashbags that look like pumpkins, court says this isn’t obvious. PTO failed by using hindsight…up until now not obvious to anybody. Cautions against looking at sublime simplicity once you see it. Here looking at commercial success. Not longfelt unmet need or failure of others. Important principle regarding to what extent can combine prior art references—must find suggestion of combination of elements. Existence alone not enough without suggestion of combination. a. Note 1: line of cases where court says PTO can’t refer to common knowledge, need authority—cite to a disclosure. b. Note 2: holding of invalidity for obviousness based on combining two references where one talks about general surface protein, not related to claimed utility an another use to screen pharmaceutical compounds. Court said could combine. Almost contrary to pumpkin case. 3. Note on Non-Obviousness and Biotechnology Inventions a. Important case of In re Bell: v. Secondary Considerations 1. recent case—moved away from using them; stressed reliance on disclosures in patent app 2. Merges: critique of using commercial success to determine patentability. What else do we want to know? Product A v. Product B. a. Marketing strategy is a big factor: How much $ did they spend? b. How much more shelf space did product B get? c. A giant multinational corporation v. inventor Bob in his garage? d. Merges favors failure of others, says that is better indicia. Too many other factors go into commercial success. h. Describing and Enabling the Invention i. The overall goal when drafting patent claims is to make them as broad as the Patent Office will allow. There are essentially two constraints on breadth of claims you can draft 1. the mass of publicly available info on your problem—the prior art 2. the actual work the inventor has done in the sense that you cannot claim anything beyond what the inventor has discovered, i/e beyond the limits of the principle of the invention a. example: Morse not allowed to claim “all forms of communicating at a distance” using electromagnetic waves since he had only discovered one form—the telegraph. Unfair to allow to claim things he hadn’t discovered like microwave communications. b. Some inventions are capable of being manifested in very wide array of embodiments. Velcro fastener: for instance present on all kinds of things. Reasonable to give patent on entire concept of new fastener. ii. Invention must be described sufficiently well that one of ordinary skill in the art can, relying on the description in the patent, make and use the invention. 1. how much info must be provided to meet this requirement and how broad the resulting claim will be are both controversial matters 2. the basic standard is that the written description must do two things: a. prove to the world that the applicant was in fact in possession of the invention at the time of the application, and b. enable those skilled in the relevant art to make and use the invention i. example of first issue above is Fiers v. Revel: 3 people all claimed to be first to have isolated DNA sequence for protein to use in treatment of cancer. Only person with first claim on invention could obtain patent. Court rejected Revel’s claim to priority on the grounds that he had not listed the actual human DNA sequence in his patent app. 1. said adequate description of DNA required more than mere statement that it is part of the invention and reference to potential method for isolating it; need descrip. Of DNA itself. Revel’s disclosure did not indicate he was in possession of the DNA, it just explained a wish, maybe a plan for obtaining the DNA. iii. The Incandescent Lamp Patent: 1. Even in cases where it’s clear one has achieved and described his invention, the description must enable readers of patent to make and use full scope of invention as claimed by patentee. 2. In their application for the patent at issue, the patentees declared their device to be an improvement of the electric light. The alleged infringers justified their actions under certain patents to Thomas Edison, denied the novelty and utility of the holder's patent, and averred that it had been fraudulently and illegally procured. The Circuit Court held the patent to be invalid and dismissed the bill. The holder appealed, and the Court held that the claims of the patent, with the exception of one, were too indefinite to be the subject of a valid monopoly of the use of all fibrous and textile materials for the purpose of electric illumination because an examination of thousands of vegetable growths showed that none of them possessed the peculiar qualities that fitted them for that purpose. The Court thus determined that the fact that paper happened to belong to the fibrous kingdom did not invest the patentees with sovereignty over the entire kingdom and thereby practically limit other experimenters to the domain of minerals. The Court also found that the patentees were not in fact the first to discover that carbonized paper was the best material for an incandescent conductor. a. Headnotes from this case: i. It is required by Rev. Stat. § 4888 (modern equivalent is 35 U.S.C. §112) that an application for a patent shall contain a written description of the device and of the manner and process of making, constructing, compounding, and using it in such full, clear, concise, and exact terms as to enable any person, skilled in the art or science to which it appertains or with which it is most nearly connected, to make, construct, compound, and use the same. 1. (note 1, p. 201) The first paragraph of § 112 has been interpreted in such a way that three distinct requirements are said to spring from it: a. The written description requirement b. The best mode requirement c. The enablement requirement 2. the second paragraph adds the separate requirement of claim definiteness ii. If the description of a device in a patent application be so vague and uncertain that no one can tell, except by independent experiments, how to construct the patented device, the patent is void. iii. Where a patent is claimed for the discovery of a combination, it should state the component parts of the new manufacture claimed with clearness and precision, and not leave a person attempting to use the discovery to find it out by experiment. iv. The Gentry Gallery v. The Berkline Corp.: 1. Plaintiff sued defendant alleging that defendant infringed its patent directed to a unit of a sectional sofa by manufacturing and selling similar sectional sofas. On appeal, the court affirmed the trial court's holding that defendant did not infringe plaintiff's patent and the trial court's refusal to award attorney fees for the defense to defendant's assertion that the patent was unenforceable. The trial court correctly concluded that the claims were not infringed by defendant and the subject matter of the asserted claims was not shown to have been obvious. However, because the trial court clearly erred in finding that the written description portion of the specification supported certain of the broader claims asserted by plaintiff, the court reversed the decision that those claims were not invalid under 35 U.S.C.S. § 112. 2. Headnotes from case a. Whether a specification complies with the written description requirement of 35 U.S.C.S. § 112 is a question of fact, which the appellate court reviews for clear error on appeal from a bench trial. b. To fulfill the written description requirement, the patent specification must clearly allow persons of ordinary skill in the art to recognize that the inventor invented what is claimed. An applicant complies with the written description requirement by describing the invention, with all its claimed limitations. c. It is a truism that a claim need not be limited to a preferred embodiment. However, in a given case, the scope of the right to exclude may be limited by a narrow disclosure. d. Claims directed to a distinct invention from that disclosed in the specification do not satisfy the written description requirement. e. Claims may be no broader than the supporting disclosure, and therefore a narrow disclosure will limit claim breadth. 3. Gentry Gallery has been described as a case about an “omitted element. To those who favor this terminology, the case centers on the omission of an originally disclosed element from one or more final claims. Two things to consider from this analysis a. Who suffers from the inventor’s change of heart? i. Cases like Gentry—if the amended claims had been allowed and found valid, the patentee’s competitor (Berkline) would have suffered. Their product would be bounced from the market, perhaps to be replaced by an identical product from the patentee. Would amount to appropriation of competitor’s variation to original applicant. (but, in this case, only trivial variant on Gentry’s bona fide invention—had doc on file that enabled artisans to arrive at variant with minimal effort) b. As far as Berkline is concerned, was purely fortuitous that Gentry had not adequately described Berkline’s variation. No way Berkline could have found out what precisely constituted Gentry’s initial disclosure. Nothing akin to reliance argument in favor of Berkline. Nothing they could have done to avoid Gentry’s appropriation. 4. Gentry Gallery has been widely criticized. 5. One possible benefit of written description requirement is to preclude patent owners from later claiming what they did not think of at the time they filed their apps. This is particularly significant when patent does not issue until long after app is filed. See note 5 p. 207. v. Note on Development of the Written Description Requirement 1. took root in judicial desire to rein in free and easy patent drafting 2. particular object of judge’s displeasure was amendment practice a. patent lawyers adept at filing apps that broadly if sometimes vaguely describe invention. Law has for many years required at least one formal claim accompany the app. Original filing merely opening bid in long game of rejections, amendments, final rejections, etc. b. While thus negotiating/amending, patent lawyers also keep eye on inventor’s follow-up research and market into which invention has found its way. Lawyer makes amendments accordingly c. Common example—competitor introduces product that contains variant. If language in patent app allows, inventor adds claim to embrace new variant so that it infringes patent when it is issued. This is standard practice. i. From late 1980s, doctrine resuscitated. Court has pointedly deployed “written description as independent and often very stiff requirement of patentability. Two important Cases: i. Gentry Gallery 1. Eli Lilly: a. patent app disclosed DNA sequence for rat insulin; final version claimed rat, mammalian, vertebrate, and human insulin. Closely related variants. Human differs from rat by only 12 (out of 300) pairs. b. Court invalidated claim to human on grounds specification did not meet written description requirement. c. cited cases holding disclosure of amino acid sequence for protein, together with well-known techniques for identifying a DNA sequence from the amino acids did not render the resulting sequence obvious under § 103. Since even obvious variants of disclosed material might not be within the written description of specification, it was clear to court that nonobvious variants were also not adequately described. ii. Note on “Analog” Claims in Chemical an Biotechnology Patents: 1. Many chemicals have analogs. Two different molecules with almost identical chemical structures will normally behave in approx the same way. Same with similar DNA sequences. 2. Problem with prevalence of analogs is that if those who try to patent new chem. Or bio products claime only precise sequence or structure they have identified, it is easy for others to design around that by varying an insignificant part of the total structure. 3. To avoid this problem, patentees claim both the precise structure they have produced and its analogs. 4. To what extent claim should be allowed to preempt such analogs is difficult problem. a. Amgen : i. P and D each held patents on technology related to production of EPO (bio protein for combating anemia). P Amgen held patent on recombinant DNA version, D Chugai held license from Co-D Genetics Institute under product patent for purified EPO made by concentrating trace amounts of protein from natural sources. ii. Affirmed district court’s invalidation of the claims under § 112. Amgen claimed every possible analog, but only told how to make and use a few of them. Court said do not intend to imply that generic claims to genetic sequences cannot be valid where they are of a scope appropriate to the invention disclosed. That was not the case here. Said more needed concerning identification of various analogs within scope of claim, methods for making them, and structural requirements for producing compounds with EPO like activity. iii. It is not necessary for patent applicant to test all the embodiments of his invention. What is necessary is that he provide a disclosure sufficient to enable one skilled in the art to carry out the invention commensurate with the scope of his claims. That means, for DNA sequences, testing disclosing how to make and use enough sequences to justify a grant of the claim sought. iv. Amgen’s disclosure might justify a generic claim, but did not support claim for all EPO gene analogs. 1. generic claim: it is well established that a patent app is entitled to claim his invention generically, when he describes it sufficiently to meet the reqs of §112. A specification may, wi/in meaning of §112, paragraph 1, contain written description of broadly claimed invention without describing all species that claim encompasses. v. Notes following case: 1. Homology—another expansive claim format. See p. 211. 2. To what extent must the invention itself be fully described in the patent specification? 3. Atlas Powder: 4. Enablement cannot be defined without first determining who must be enabled. Patent specification not addressed to judges, lawyers, or unskilled, but to those skilled in the art. iii. Note on Best Mode Requirement 1. in addition to the written description and enablement requirements, § 112 also mandates that the patent disclose the “best mode” of carrying out the invention contemplated by the inventor. a. This req designed to prevent patentee from holding back knowledge from public, in effect maintaining part of invention as trade secret while protecting whole under patent law. b. Recent opinion describes b.m.r. as effectuating “a statutory bargained-for-exchange by which a patentee obtains the right to exclude others from practicing the claimed invention for a certain time period, and the public receives knowledge of the preferred embodiments for practicing the claimed invention.” c. Best mode requirement outlined in Bayer case. i. Best mode violations are found where there is either 1. a failure to disclose a preferred embodiment, or 2. failure to disclose a preference that materially affected making or using the invention ii. There are two essential elements to the doctrine: 1. the factfinder must determine whether, at the time patent app was filed, the inventor had a best mode of practicing the claimed invention—whether there was a preferred way to build or use the claimed device or process. a. If inventor himself had no preferred way, cannot be best mode violation. [entirely subjective inquiry based on inventor’s belief in existence of best mode] b. The actual extent of info that inventor must disclose depends on scope of claimed invention. 2. once est. that inventor actually contemplated a best mode, court will inquire whether disclosure in the specification is adequate to enable one of ordinary skill in the art to practice the best mode of the invention. a. This inquiry is objective and depends upon scope of claimed invention and level of skill in the relevant art. iii. One important issue that is sometimes litigated is the question of whether an inventor must update his or her best mode disclosure during patent prosecution. 1. In general, if material in continuation app is “common subject matter” with that of orig app, the inventor need not have updated his best mode disclosure in the continuation app. An inventor only has obligation to disclose best mode in continuation app if claim feature associated w/best mode first appeared or first received adequate written description in continuation. E. Infringement a. Claim Interpretation i. linguistically minor variations in phraseology and meaning= difference between finding of infringement (exclusion of competitor, maybe damages) and no infringement (open entry into at least part of the patentee’s market). 1. interpretive sources a. Where courts look for guidance regarding the meaning of claim terms 2. canons of construction a. What general rules of interpretation courts apply in interpreting claims 3. interpretive procedures a. When in the course of patent litigation a trial court should issue a definitive ruling regarding the meaning of claim terms, and what rules apply to appeals regarding these rulings ii. Interpretive Sources 1. Black letter law permits recourse to 3 primary sources in interpreting claims: a. Claim Language i. Language of the claim itself is foremost. Patent law’s version of plain meaning rule--courts often resort to common linguistic definitions in deciding between the parties’ proffered interpretations. Everyday dictionaries. ii. Example: case turned on “reciprocating”. infringer said should be interpreted as linear reciprocation; court said wanted to use ordinary meaning, not limited to linear reciprocation. Another court refused to limit the term “groove” where dictionaries defined it broadly. b. Patent Specification i. Ambiguity can be found in any source, including ordinary meanings. Reinshaw case--“where there are several common meanings for a claim term, the patent disclosure serves to point away from the improper meanings and toward the proper meaning” patent disclosure of a singular purpose was used by court to define “when”. Other words considered by the Federal Circuit include “a”, “or”, “to”, “including”, and “through.” In many other cases, the specification alone supplies the meaning of a claim term, without recourse to the dictionary (the interaction between specification and claims is one source of the interpretive canons described later) c. Prosecution History i. An applicant sometimes makes statements during prosecution that limit the meaning of claim terms. 2. Extrinsic Evidence: although intrinsic evidence takes precedence, court may also look to evidence such as expert testimony, technical treatises, and others. a. Confusion attends the use of extrinsic evidence. One such dispute concerns the role of expert testimony in helping the fact finder construe the claims of the patent and compare them to the accused device. The Federal Circuit has offered inconsistent guidance on this question. b. Vitronics Corp v. Conceptronic, Inc.: Court said that in most situations an analysis of the intrinsic evidence alone will resolve ambiguity in a disputed claim, and in such cases it is improper to rely on extrinsic evidence. Public record= claims, specification, and file history. Competitors are entitled to review the public record, apply the established rules of claim construction, ascertain the scope of the patentee’s claimed invention and , thus, design around the claimed invention. Allowing the public record to be altered by extrinsic evidence would make this right meaningless. Same true for both patentees and alleged infringers i. “Extrinsic evidence is that evidence which is external to the patent and file history, such as expert testimony, inventor testimony, dictionaries, and technical treaties and articles.” ii. The court said that admission of extrinsic evidence is only appropriate in instances where the intrinsic evidence is insufficient to enable the court to determine the meaning of the asserted claims. Then extrinsic evidence can be relied on to understand the technology and construe the claims. Extrinsic evidence can only not be used to vary or contradict the claim language, but just to help the court come to a proper understanding. The inventor’s subjective intent (when unexpressed in the patent documents) may not have any effect. c. Bell & Howell Document Mgmt. Prods. V. Altek Sys.: similar to Vitronics. d. Other Federal Circuit cases show the court has backed off considerably from the sweeping rhetoric of Vitronics. One court explicitly called for the use of extrinsic evidence on remand. Advanced Cardiovascular Systems. Another permitted broad leeway to district courts in deciding on outside sources to help in claim construction. Pitney-Bowes, Inc. v. Hewlett-Packard Corp. Others praise the virtues of dictionaries as a resource in claim construction. Vanguard Prods. Corp. v. Parker Hannifin Corp. iii. Canons of Construction 1. Claim-Specification Relationship a. Reinshaw: two important canons of construction i. one may not read a limitation into a claim from the written description, but ii. one may look to the written dexcription to define a term already in a claim limitation, for a claim must be read in view of the specification of which it is a part. b. These two rules lay out the general relationship between the claims and the written description) c. These two rules share two underlying propositions i. it is manifest that a claim must explicitly recite a term in need of definition before a definition may enter the claim from the written description. A party wishing to use statements in the written description to confine or otherwise affect a patent’s scope mus, at the very least, point to a term or terms in the claim whit which to draw in those statements. Without any claim term that is susceptible of clarification by the written description, there is no way to narrow the property right. ii. where a patent applicant has elected to be a lexicographer by providing an explicit definition in the specification for a claim term. There, the definition selected by the patent applicant controls. The law gives the patentee this opportunity because the public may not be schooled in the terminology of the technical art or there may not be an existant term of singular meaning for the structure or concept that is being claimed. 2. Patentee as Lexicographer a. Johnson Worldwide Associates, Inc. v. Zebco Corp.: Two situations where entry of a definition of a claim term other than its ordinary and accustomed meaning is required: i. If the patentee has chosen to be his or her own lexicographer by clearly setting forth an explicit definition for a claim term ii. Where the term or terms chosen by the patentee so deprive the claim of clarity that there is not means by which the scope of the claim may be ascertained from the language used. 1. (In both situations, a term or terms used in the claim invites or requires reference to intrinsic, and in some cases, extrinsic evidence) 3. Claim Differentiation a. “lex rejicit superflua, pugnatia, incongrua” = “the law rejects superfluous, contradictory, and incongruous things.” b. Construction of a claim that would render another claim in the patent redundant is to be avoided. i. Ecolab, Inc. v. Paraclipse,Inc.: narrower dependent claim later in the patent prohibited from infringer arguing for a broad, independent claim to adopt the definition in the narrower claim. 4. Presumptive Breadth a. Two general rules of claim construction amount to a set of presumptions regarding claim breadth: i. a claim should be interpreted so as to preserve its validity ii. if a claim is subject to two viable alternative interpretations, the narrower one should apply. This works as a penalty for unclear drafting or a tiebreaker from the public policy view. The rule applies only when two equally plausible meanings for a claim term are possible. It does not mean that in cases of ambiguity the narrow meaning always wins out. iv. Interpretive Procedures 1. Note on the Proper Role of Judge and Jury in Patent Cases a. Distinction between questions of law and fact is an important issue. Whether a judge or jury decides key issues such as how an invention differs from the prior art or how it works compared to a competitor’s product may make a significant difference in the outcome of a patent infringement case. b. Markman v. Westview Instruments: judges are in driver’s seat when it comes to interpreting patent claims. The court ruled that claim construction is a matter of law. Also, Federal Circuit has held that it will review district court findings de novo. The Supreme Court affirmed unanimously. b. Literal Infringement i. 35 U.S.C. § 271 gives patentee right to make, use, sell, offer for sale, or import invention described in the claims of the patent. Because patent is defined in terms of its claims, a patent infringement suit is resolved by comparing the claims of the patent to the accused product. ii. To literally infringe, each and every element of claim must be infringed. Presumes that each and every element of a claim is material and essential. iii. No matter how much you add beyond won’t save you if some part infringes on elements of clam. Need license from patent holder to practice an improvement. Don’t trespass if you get improvement patent. Then patent-holder blocked from using without license from you. iv. A patent holder can seek to establish patent infringement in either of two ways: by demonstrating that every element of a claim (1) is literally infringed or (2) is infringed under the doctrine of equivalents. v. Larami Corp. v. Amron: 1. does device literally infringe on each element of claims in terms of its specific wording? 2. factual question: Does Larami’s supersoaker infringe on TTMP’s patent( Has light and sound)—is that the same? 3. Because claim interpretation is a question of law, it is amenable to summary judgment. 4. The words in a claim should be given their "ordinary or accustomed" meaning. An inventor's interpretations of words in a claim that are proffered after the patent has issued for purposes of litigation are given no weight. 5. Plaintiff's device had not literally infringed defendant's patent because an element of defendant's claim was missing from plaintiff's product. To infringe, have to trespass on not the patent as a whole, but on each/every element of claim. In this case, water chamber within housing of the gun was element not infringed on. 6. doctrine of equivalents: There was no genuine issue of material fact as to whether plaintiff's devices infringed defendant's patent under the doctrine of equivalents because of several differences between plaintiff's devices and defendant's patent. tank w/in 129 patent could have presumably been anywhere w/in housing; nothing w/in element of patent to which an equivalent could have arisen. Can make same thing, just not all of the same thing. c. The Doctrine of Equivalents i. Basically opposite function of literal. Each element need not be identically present in accused infringement. All required is substantial equivalent. ii. To show infringement under the doctrine of equivalents, the patent owner bears the burden of proving that the accused product has the "substantial equivalent" of every limitation or element of a patent claim. Put another way, the patent owner must show that the accused product performs substantially the same overall function or work, in substantially the same way, to obtain substantially the same overall result as the claimed invention. (Headnote from Laramie) iii. The doctrine of equivalents is limited by the doctrine of prosecution history estoppel. 1. to the extent an inventor has limited his invention in a particular way in the proceedings before the Patent Office, he will not be allowed to later broaden the claims through the doctrine of equivalents if that broadening will have the effect of nullifying the limitations to which the inventor agreed before the examiner. 2. it’s a defense to infringement. iv. The doctrine of equivalents is used to hinder the "unscrupulous copyist" who could otherwise imitate a patented invention as long as s/he was careful not to copy every inconsequential detail of the claimed inventions, or to make some "unimportant and insubstantial" change to the claimed invention. The doctrine is reserved for the exceptional case. (Headnote from Laramie). Not having doctrine creates tight limitations on rights of patent holder; people would get around by trivial changes to get around literal scope of elements of claim. Patent holder needs leeway for patent to have value; it is difficult to cover all easily foreseeable minor variations in the literal language of claim. v. If the public comes to believe (or fear) that the language of patent claims can never be relied on, and that the doctrine of equivalents is simply the second prong of every infringement charge, regularly available to extend protection beyond the scope of the claims, then claims will cease to serve their intended purpose. Competitors will never know whether their actions infringe a granted patent. Thus, failure to produce evidence on any one of a claim's elements can result in a grant of summary judgment against the patent owner on the infringement claim (Headnote from Laramie) vi. It should be noted that the doctrine of equivalents will have varying breadth depending upon the patent. 1. pioneer patent will have greater breadth that much later improvement because of the very nature of policies underlying patent law. Pioneer discovers large field for which inventor fairly with broad patent. Inventor of later improvement’s discovery sits on shoulders of earlier pioneers— rewarded with commensurately smaller field to monopolize and range of equivalents thus shrinks. vii. Warner-Jenkinson Co. v. Hilton Davis Chem. Co., Inc.: 1. The critical test is whether the allegedly infringing device performs substantially the same function in substantially the same way to obtain substantially the same result as the patented product or process. 2. Supreme Court here cautions doctrine is to be confined to finding that each and every element of a claim, or its equivalent is found in the alleged infringement. It is error to apply the doctrine to the invention as a whole performs substantially the same function, in substantially the same way, to achieve substantially the same result. 3. Not same as doctrine of equivalents used for means-plusfuncctio claims. This is called the “limiting” doctrine of equivalents, which prevents those claims from having unlimited scope—limits them to only equivalents of what appears in the specification. 4. also involves prosecution history estoppel:. Hilton Davis has ‘746 patent on dye purification process. H.D. told patent examiner their app distinguishable from prior art b/c PH level btw 6 and 9. W.J.’s process at PH of 5. H.D. admits not exactly the same. Doesn’t literally infringe. But can’t say why 6 is limitation though. WJ could use p.h.e. as defense for their alleged infringement; b/c HD limited PH to 6-9, left anything not in that scope to the public. Patent holder estopped from arguing the element of its claim could go beyond the expressed limitation. By saying 6-9, HD surrendered argument that the scope encompasses 5. Court says how this should be approached: a. The burden should be placed on the patent-holder to establish the reason for an amendment required during patent prosecution. The court then would decide whether that reason is sufficient to overcome prosecution history estoppel as a bar to application of the doctrine of equivalents to the element added by that amendment. Where no explanation is established, however, the court should presume that the Patent and Trademark Office had a substantial reason related to patentability for including the limiting element added by amendment. In those circumstances, prosecution history estoppel would bar the application of the doctrine equivalents as to that element. 5. Court invited to do away with doctrine of equivalents. They don’t. Say test of equivalence is an objective inquiry on an element by element basis. a. Traditional test is the “Triple Identity Test” a/k/a function-way-result test. Element performs same function in same way to get same result. b. Another test is the “Insubstantial Differences Test.” If not more than insubstantial difference; very subjective. Some cases apply in particular case/controversy. c. So according to the SC, what is the test? Just obj. inquiry on element by element basis. Don’t say which of the two above is right. Have to infringe on each element. Can have combo (literally infringe on some and equivalently infringe on others). 6. What equivalents are covered? One argument is that they should be limited to things known at time the patent app is filed. Court disagrees, says that limited to things known at the time of infringement. 7. note 2 after case: a. The Supreme Court here held that “the court should presume that the PTO had a substantial reason related to patentability for including the limiting element added by amendment.” From context of case, court means patentability clearly encompasses amendment to avoid rejection in light of prior art. (35 U.S.C. §§102 or 103). b. Rejections not all based on prior art, can be rejected under §112 as well. viii. DOCTRINE OF EQUIVALENTS AND PRIOR ART -Wilson Sporting Goods: Wilson said golf ball patent of infringer covered by equivalents. Infringer’s ball had very similar configuration of dimples, but wilson’s had group of 6 circles free of dimples. Court rejected claim of infringement under doctrine of equivalents. Can’t obtain by equivalents what you couldn’t have gotten by a patent. PTO wouldn’t have allowed that claim b/c of prior art. Can’t expand scope of patent by equivalent into areas encompassed by the prior art. [A patentee should not be able to obtain, under the doctrine of equivalents, coverage that he could not lawfully have obtained from the Patent and Trademark Office (PTO) by literal claims. The doctrine of equivalents exists to prevent a fraud on a patent, not to give a patentee something which he could not lawfully have obtained from the PTO had he tried. Thus, since prior art always limits what an inventor could have claimed, it limits the range of permissible equivalents of a claim.] ix. Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., Ltd.: 1. Next big development in D.O.E. Relationship between D.O.E. and P.H.E. at issue here. 2. Festo has patents on magnetic rodless cylinder that is in lots of crap i.e. sewing equipment. SMC is alleged infringer. Theirs has two differences re. sealing ring and magnet. SMC said Festo estopped because of added limitations in course of prosecution. Festo had argued limitation added to avoid prior art, so no estoppel. a. When estoppel applies does it stand as absolute bar to equivalence (when amendment determined to be made for reasons of patentability)? i. Once estoppel established with respect to particular element, patent holder is stuck with literal infringement. If you amend for patentability reasons, cannot invoke D.O.E. Puts double burden on patent-holder: ii. limited to literal interpretation, can’t prove alleged infringers invention is just like that element. b. Festo: i. Patentability= any of criteria ii. When surrender under P.H.E., not absolutely barred from asserting D.O.E. Burden on patent holder to show good reason why it should not have surrendered equivalent around that element. 3. What is the SC leaving open in its flexible bar? (note 2 p. 246) 3 scenarios that get around: a. The after-arising technologies (meaning unforeseeable equivalents) method of overcoming the bar b. Amendments made for reasons tangential to the equivalent in question c. Residual category where “for some other reason” the patentee could not be expected to have described the equivalent the court discusses. x. Note: What is A Limitation? 1. Hughes Aircraft: a. “The Williams Patent”D claiming doctrine equivalents does not apply. After arising technologies. b. In the original patent data transferred from satellite to ground station where calculations made, data used on ground to develop new positioning coordinates, then sent back to satelleite to change positioning. c. Technology develops that contradict literal terms of patent, yet when taken altogether provides some functionality embodied in patent app. d. Remanded for reconsideration on basis of Hilton-Davis (look at each element of claim). Here all elements working together deemed to infringe patent. Violated D.O.E. Ground station not sending= difference in technology. Court said this kind of technology didn’t exist back then, so even though it doesn’t look like it infringes, it does. These are insignificant differences. e. Hughes court struggled with two aspects of Hilton Davis: i. Adoption of element by element approach to equivalence ii. Preservation of rule that equivalence is measured as of time of infringement and not as of time of invention. iii. Ultimately concluded that subsequent developments in technology obfuscated the limitation. xi. Subject Matter “Disclosed but Not Claimed” 1. Johnson & Johnston Associates Inc. v. R.E. Service Co., Inc.: J&J have patent for making printed circuit boards with sheet of aluminum. (Say in specification that other metals can be used). RES uses steel. J&J sues for infringing under D.O.E. In patent claim says aluminum. In specification says aluminum currently preferred material but other materials such as zinc or steel may be used. RES uses steel. RES says no infringement because only claimed aluminum. 2. Court says if put in specification but unclaimed, that embodiment is dedicated to public, can’t claim D.O>E. This is based on principle that the scope of the patent is determined by the claims. 3. Then what is the purpose of the specification? To demonstrate that applicant is able to make/let others make invention; a demonstration of enablement maybe not directly discernable from a mere review of claim. 4. Court says two potentially conflicting precedents: a. Maxwell b. YBM Magnet c. Could be within specification if part of same element but not if distinct invention. 5. Balance we’re trying to strike in terms of breadth (Extent to which can use specification to expand scope of claim): a. Inventor’s Interest [doesn’t want someone to work around with minimal amount of effort] VS b. Definition and Notice Function: get patentee to be specific so those who read can understand how close they can come to the patent without infringing it. Public needs to know scope 6. Result: Specified but unclaimed subject matter is dedicated to the public. Can’t be infringement. 7. Concurring Opinion: a. Says there should be foreseeability test; this would have been foreseeable. Shouldn’t be able to expand claims to things you’d foresee at time you filed your patent application. If you’ve included in specification you have foreseen it. DOEdon’t allow if could foresee technology. Same principle, if could foresee but didn’t claim can’t use. 8. Dissent: a. Says problem raised by this holding is htat this will have effect on patent applicantswill say as little as they can because anything in specification bot in claim will be deemed dedicated to public. So lawyers will stop putting info in specification. 9. Claims interpreted in light of specification: there has never been rule against this. Prof. says it’s actually blackletter law. But now, court saying if not in claim but in specification = public. Abbott says he thinks this rule is encouraging elaboration. 10. Note on the Problem of After-Arising Technologies: a. When patent mere improvement, courts tend not to consider as equivalent a product or process that is even a modest distance beyond the literal terms of claims. b. But when patent represents a “pioneer invention” [defined as patent concerning a function never before performed, a wholly novel device, or one of such novelty and importance as to make a distinct step in the progress in the art] it’s entitled to a broad range of equivalents. Court will stretch to find infringement even by product whose characteristics lie considerably outside boundaries of literal claims. c. Texas Instruments case: court said combination of changes in elements enough to constitute new invention rather than infringement on old. (p.261) d. The “Reverse” Doctrine of Equivalents i. DOE says can expand scope of claims outside original terms to encompass after arising devices. ii. Reverse of this: 1. situation would claim in: if I improve, say it shrinks scope of what came before. Maybe literally within scope of claim, but should narrow scope not to cover me because I’ve done something to improve in way that patent holder did not/could not foresee or intend to encompass. He inadvertently preempted my invention because of the way he drafted, but he didn’t mean to. iii. A logical alternative to this approach: 1. a number of cases argue that the original patent was overbroad and therefore failed on enablement. Question of validity and scope. Read literally, claim encompassed, but never described in way to enable. Should either narrow scope or invalidate patent. iv. See Scripps case in note 2 p. 265. Recombinant biology—lots of cases on shift from old biology to new biology. e. Equivalents for Means-Plus-Function Claims i. These claims are limited to equivalents of what appears in the specification. Hilton-Davis. ii. §112 ¶ 6 of patent act of 1952. iii. That act invalidated many patent claims (often to processes) on grounds they covered entire functions rather than specific machines. iv. §112 ¶ 6 reflected widespread sentiment in favor of mechanism of to claim broad functional features of inventions. Doesn’t permit claims for entire function (i.e. broadcasting or cutting) but does allow functional language in claims to cover claim elements. 1. example: patentee can claim as combination an invention consisting of novel microprocessor together with “means for inputting data to be processed.” Depending on content of specification, claim might include use of novel microprocessor with data entered from keyboard, read from disk, or beamed in from remote source via wireless communication, or other “means for inputting.” f. Contributory Infringement i. Committed by knowingly selling or supplying nonstaple item for which the only or predominant use is in connection with a patented invention. ii. Contributory infringer can be liable even though what he has sold is completely in the public domain and has no patent protection itself. Has practical effect of extending patent to items not patented and presents possibility of sanctioned monopoly over the unpatentableconstitutional issues. iii. Defenseno knowledge iv. 35 U.S.C. § 271 (c): Whoever offers to sell or sells within the united states or imports into the United States a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial noninfringing use, shall be liable as a contributory infringer. v. C.R. Bard, Inc. v. Advanced Cardiovascular Systems, Inc.: 1. Plaintiff filed suit alleging defendant's catheter was adapted for use in a manner that infringed plaintiff's patent. Plaintiff asserted defendant was a contributory infringer and actively induced infringement. Defendant appealed the district court's order granting plaintiff's request for summary judgment. The court held that issues of material fact existed regarding the interpretation of the patent claim and whether the catheter had any use except through practice of the patented method. Summary judgment finding defendant was a contributory infringer was thus improper. Since the evidence was ambiguous regarding the fact patterns under which the catheter was to be used, genuine issues of fact existed regarding whether defendant induced infringement. Finally, defendant raised a genuine issue of fact through the evidence it provided regarding whether plaintiff's patent was not invalid for obviousness. 2. Testing the assertion of contributory infringement requires a two step analysis. a. First is a determination of the scope of the claim at issue. b. Second is an examination of the evidence before the court to ascertain whether, under 35 U.S.C.S. § 271(c), use of the device would infringe the claim as interpreted 3. When a charge of contributory infringement is predicated entirely on the sale of an article of commerce that is used by the purchaser allegedly to infringe a patent, the public interest in access to that article of commerce is necessarily implicate 4. d. Grant of summary judgment finding ACS infringer under 271 (c ) not appropriate viewing evidence in light most favorable to nonmoving part and resolving all reasonable inferences in their favor. 5. A person induces infringement under 35 U.S.C.S. § 271(b) by actively and knowingly aiding and abetting another's direct infringement. a. Bard argues ACS induced infringement under § 271(b) by: i. Providing detailed instructions and other literature on how to use its catheter in a manner which would infringe claim 1; and ii. Having positioned the inlets near the balloon’s proximal end so as to allow a user of the ACS catheter to infringe claim iii. 35 U.S.C. §271 (b): Whoever actively induces infringement of a patent shall be liable as an infringer. 6. When a charge of contributory infringement is predicated entirely on the sale of an article of commerce that is used by the purchaser allegedly to infringe a patent, the public interest in access to that article of commerce is necessarily implicated. vi. 1996: Congress amended the patent laws to exempt doctors who perform medical processes from liability for infringement. But left device manufacturers liable for contributory infringement of such patents. See 35 U.S.C. § 287. vii. Federal Circuit has held that § 271 (c) requires showing that alleged contributory infringer knew that the combination for which her component was especially designed was both patented and infringing. viii. Note on Inducement 1. concepts of inducement and contributory infringement evolved to address infringing activity that somehow lacked the element of direct making, using or selling of patented invention. 2. contrib. inf. Sweeps into net of infringement of making, use, or sell of less than the entire patented device. 3. inducement, on the other hand involves behavior that omits any making, using, or selling, but nevertheless amounts to an attempt to appropriate the value of an invention. Often described as activity that aids and abets infringement. Liability broad enough to include host of activities, but usually involves instructing another to violate a patent. 4. case law and legislative history assert requirement of “knowing” even though §271(b) does not use it. Circumstantial evidence of intent may suffice. Requisite intent may be inferred from all the circumstances. Person incused of inducing must know of the patent. Also generally required that infringer knows his activities will lead to infringement. Number of cases turn on existence of and credibility of meaning of patent attorney’s opinion letter regarding whether the accused activities will in fact result in patent infringement. 5. classic example of contrib. infring. And inducement is sale of device components or replacement parts for a patented device, even thought the parts themselves constitute less than complete device and hence are not direct infringement. Inducement often used to attack sellers of parts where actual ultimate infringers are end-users who replace parts or assemble components. F. Defenses a. The “Experimental Use” Defense i. Judicially created exception to infringement aside from § 271. Allows for unlicensed construction and use of patented invention for purposes of pure scientific inquiry. ii. Doctrine originated in Justice Story’s opinion in Whitmore v. Cutter: D appealed jury instruction that the “making of a machine…with a design to use it for profit constituted infringement.” Justice Story upheld instruction, stated that the “it could never have been the intention of the legislature to punish a man, who constructed such a machine merely for philosophical experiments, or for the purpose of ascertaining the sufficiency of the machine to produce its described effects.” Later cases followed limiting exception to these narrow grounds. iii. Bolar case: Federal circuit said experimental use exception did not include “the limited use of a patented drug for testing and investigation strictly related to FDA drug approval requirements.” (Bolar did FDA testing so could market P’s drug as soon as patent expired). Experimental use solely for business reasons, not for amusement or curiosity. “Unlicensed experiments conducted with a view to the adaptation of the patented invention to the experimentor’s business are a violation of the rights of the patentee to exclude others from using his patented invention.” iv. Exception to Bolar case created through legislation: see §271(c)(1): regulatory drug testing exemption from infringement that permits preexpiration regulatory testing of a patented drug. (Trade-off for exemption was patent term restoration for pharmaceutical patents which allows patentees to get extensions to offset regulatory review period.) Scope of exempt subject matter under §271(e) interpreted to cover medical devices. b. Inequitable Conduct i. Kingsdown Medical Consultants. Ltd. V. Hollister, Inc.: , 1. Inequitable conduct resides in failure to disclose material information, or submission of false material information, with an intent to deceive. 2. elements of materiality and intent must be shown by clear and convincing evidence. (findings on them subject to clear and erroneous standard of FRCP 52(a) and are not to be disturbed unless court has definite and firm conviction mistake has been made). 3. To be guilty of inequitable conduct in a patent action, one must have intended to act inequitably. 4. Whether the intent element of inequitable conduct is present in a patent action cannot always be inferred from a pattern of conduct that may be described as gross negligence. That conduct must be sufficient to require a finding of deceitful intent in the light of all the circumstances 5. There is nothing improper, illegal or inequitable in filing a patent application for the purpose of obtaining a right to exclude a known competitor's product from the market; nor is it in any manner improper to amend or insert claims intended to cover a competitor's product the applicant's attorney has learned about during the prosecution of a patent application. Any such amendment or insertion must comply with all statutes and regulations, of course, but, if it does, its genesis in the marketplace is simply irrelevant and cannot of itself evidence deceitful intent. 6. When a court has finally determined that inequitable conduct occurred in relation to one or more claims during prosecution of the patent application, the entire patent is rendered unenforceable. 7. OVERVIEW: Plaintiff was a corporate patent holder who brought suit against defendant corporation for patent infringement. While plaintiff appealed its claims rejected by the patent office, its attorney found defendant was manufacturing a device similar to plaintiff's. Plaintiff retained outside counsel to file a continuation application and withdrew its appeal. The district court found where plaintiff was grossly negligent in allowing a claim misrepresentation where review of other claims would had uncovered the misrepresentation, the district court found plaintiff committed gross negligence. The district court found gross negligence evidenced plaintiff's intent to deceive and held plaintiff's conduct inequitable. Thus, the district court declared plaintiff's patent unenforceable. Plaintiff appealed. The court reversed and remanded, holding where an intent to deceive had to be proved by clear and convincing evidence, plaintiff's negligent filing of its continuation application did not rise to a level of deceitful intent. Therefore, the patent was enforceable. ii. note 2, p. 280: many caseswhen one is aware of prior art but suppresses it. iii. note 3, p. 280: “Submarine Patenting”—has largely disappeared; arises in limited circumstances. Before 1994, the patent lasted 17 yrs from the day of its grant, so one could prosecute for a really long time. This was an incentive when the applicant was “ahead of the technology curve. It’s the process of delaying the grant of a patent to spring it on an unsuspecting industry. Now patent apps are public 18 months after filing. One of the reasons we moved to 20 years past filing. c. Patent Misuse i. judicial doctrine that bars patentees from enforcing their patent against infringers when they have “misused the patent.” ii. Motion Picture Patents Company v Universal Film Manufacturing Company et al : camera for showing movies; can only use with a particular kind of patented film. 1. Notice license: buyer is not actually buying from patent holder, no privity of contract. A notice on the camera says it can only be used with X kind of film. These are not uncommon. The Court said the notice license was a misuse of the patent—it was extending the patent beyond its bounds. The patent holder has enumerated rights to prevent 3rd parties from making/using/selling the patented article. The patent holder has the right to vend the article, but he does not have the right to enlarge the scope of the patent by giving the patent holder control over a second market (in this case, the film market). 2. Staple and Nonstaple goods a. Staple: have existing market beyond use with patentcaan’ add to the patent through contract b. Non-Staple: no substantial commercial use except in connection with patent (i/e HP ink cartridge for HP printer-arguably, what a terrible holding) 3. Exhaustion Doctrine a. Once patent holder has placed good into commerce, patent holder may no longer exercise control over movement of good (exhausts rights upon first sale) b. Example: cars. Once you buy, patentholders can’t exercise control over stuff in/on it. c. Serves as critical limitation on scope of patent rights. Patent holder recovers economic value of right in first sale; can’t try to get any more after that. 4. Holmes’s Dissent iii. 35 U.S.C. §271(d)… Patent Misuse Reform Act: to have patent misuse with respect to a tying product (camera) need market power with respect to the product such that you’d control the secondary market. iv. Activities that are potential patent misuse 1. Non-metered licenses: royalty based on thing independent of patented product, such as gross level of sales. Abuse= paying for something that you don’t need. 2. Grantback Clauses: licensee has to grant rights to any improvement patents to patentee while using licensed patent. Becomes anti-trust problem in “exclusive grantback”give patentee exclusive right, licensee can’t use improvements. 3. Field-of-use Restrictions: restricts subject matter-field of technology 4. Patent Suppression: nothing requires patent holder to use the patent. Non-use. Public good not served, undercuts purpose of patent law. G. International Patent Law 1. Procedural Rules: What kind of mechanism do we have for internationalizing a patent? a. Paris Convention i. right of priority: first app has right for one year to file in any other country that is part of Paris Union. During 1 year no one else can interfere with right, make disclosure of prior art that would prevent patentability. Patent term in every other country is based on application filing date. Different application dates in different countries based on application date, but only one priority date: date of first app. b. The Patent Cooperation Treaty (PCT) i. file app @u.s. PTO. R.O.=receiving office. At any time within 12 months of filing, can designate app a PCT application and U.S. PTO will send to PCT office in Geneva. Can designate up to 120 countries where you want to file. Also designate an International Search Authority (ISA)—U.S. PTO is one, usually designate them, they do search report. Within 16 months of application, get report regarding prior art things to consider for patentability. 18 mosapp published. 20 moscan decide to enter national phase: choose which designated countries to file in (a uniform patent app); this is National Phase I. ii. OR National Phase II: examination phase. Choose IPEA, they do development report on patentability; 28 mosget exam report; 30 moscan enter national phase. Few companies patent everywhere. Main benefit: don’t pay filing fees till 30 mos, so have good idea of whether will succeed commercially and right of priority is preserved to the 30th instead of the 20th. 2. Substantive Harmonization and GATT-TRIPs (see p. 296 for bulleted list of what it requires, changes it made to U.S. law) H. Remedies a. Generally i. Remedies in IP similar to property law. ii. Measure of patentee’s injury involves number of difficult to answer questions such as 1. what would have happened to the patentee’s operations without the infringement? 2. what could competitors have done if the patentee had controlled the market for the patented component by herself? 3. In the field of technology where the patent exists, what will happen over the next 15 to 20 years? iii. Remedies for Infringement under Patent Act: 1. injunctive relief §283 2. damages, adequate to compensate the plaintiff, but in no case less that what would constitute a reasonable royalty, which damages can be trebled when appropriate, 35 U.S.C.§284 3. attorneys’ fees in exceptional cases §285 4. costs §284 b. Injunctions i. Valuation problem 1. It is hard to put a precise dollar value to a particular piece of patented technology, especially over a protracted period. 2. valuation problem is key to understanding why the injunction, and not damages, is the standard remedy in a patent case. a. Of course with respect to infringement that takes place prior to litigation, damages are the only remedy available, so valuation problems cannot be avoided entirely. 3. Negotiation of License Agreements: The purpose of injunctive remedies goes beyond allowing the rightholder to prevent activities of the infringer. a. Threat of injunction heavily influences terms of license to extent rightholder will consider negotiating one with the infringer. b. Allows rightholder to set own price for terms of license agreement that settles the infringement litigation. c. Courts think this is the efficient result because courts called on to set terms of exchange would have to spend lots of time and money i. Specialized nature of assets ii. Varied and complex business environments d. Three potential problems with allowing parties to bargain themselves: i. Parties may not know value of technology over which they are negotiating. ii. Transaction costs associated with such licensing agreements can be significant. iii. Strategic behavior may cause parties to forego some deals that would be in the best interests of both sides. 1. see note 2, p. 299 for example of strategic behavior. ii. H.H. Robertson Co. v. United Steel Deck: 1. an applicant for a preliminary injunction against patent infringement must show: a. a reasonable probability of eventual success in the litigation, and b. that the movant will be irreparably injured pendente lite (during the suit) if relief is not granted …Moreover while the burden rests upon the moving party to make these two requisite showing, the district court “should take into account, when they are relevant: i. the possibility of harm to other interested persons from the grant or denial of the injunction, and ii. the public interest 2. In matters involving patent rights, irreparable harm has been presumed when a clear showing has been made of patent validity and infringement. a. This presumption derives in part from the finite term of the patent grant, for patent expiration is not suspended during litigation, and the passage of time can work irremediable harm. Opportunity to practice invention during notoriously lengthy course of patent litigation may itself tempt infringers. b. The nature of the patent grant weighs against holding monetary damages will always suffice to make patentee whole, for principal value of patent is statutory right to exclude 3. even when irreparable injury is presumed and not rebutted, it is still necessary to consider the balance of hardships. a. Magnitude of threatened injury to patent owner is weighed in light of strength of the showing of likelihood of success on the merits against injury to accused infringer if preliminary decision is in error. Results of other litigation involving the same patent may be taken into account and the public interest is considered. No one element controls the result. 4. injunction preserves status quo if it prevents future trespasses but does not undertake to assess consequences of past trespasses. For past infringement, only monetary relief as remedy. iii. Kodak: 1. public interest: considered in deciding whether to grant stay of an injunction. 2. the public policy at issue in patent cases is the ‘protection of rights secured by valid patents.’ Courts grant—or refuse to stay—injunctions in order to safeguard that policy, even if those injunctions discommode business and the consuming public. 3. disruption of business, injury to Kodak customers and goodwill not public benefit at issue in patent cases. iv. Those both cases of preliminary injunctions. When full trial concludes with finding of infringement, this almost never any doubt that a permanent injunction will issue. Very rarely court will deny permanent. v. Treatment of patent as a liability right is rare case in patent law. 1. Foster v. American Mach. & Foundry Co.: court upheld what amounted to compulsory license; reasonable royalty damage award, but no injunction. 2. injunction equitable remedy to be determined by circumstances, not “club to be wielded by a patentee to enhance his negotiating stance.” 3. approve of flexible approach in patent litigation of avoiding ordering a cessation of business to the benefit of neither party by compensating appellant in the form of a compulsory license with royalties. Compulsory license is a benefit to patentee who has been unable to prevail in request for injunctive relief. Granting compulsory royalty gives him half a load. Fair b/c of his utter failure to exploit patent on his own. 4. What difference should it make that patentee does not manufacture anything—i.e. is not practicing the patent? In theory has right not to, but other cases have taken this into account in setting remedies. c. Damages: Reasonable Royalty and Lost Profits i. Panduit : 1. Often used four factor test for determining lost profits: To obtain as damages the profits on sales he would have made absent the infringement, i.e. the sales made by the infringer, a patent owner must prove: a. Demand for the patented product b. Absence of acceptable non-infringing substitutes c. His manufacturing and marketing capability to exploit the demand, and d. The amount of the profit he would have made 2. Lost profits are available if there are “no adequate substitutes.” 3. When actual damages, e.g. lost profits, cannot be proved, the patent owner is entitled to a reasonable royalty. a. Reasonable royalty is amount which a person, desiring to manufacture and sell a patented article, as a business proposition, would be willing to pay as a royalty and yet be able to make and sell the patented article, in the market, at a reasonable profit. ii. Polaroid Corp. v. Eastman Kodak Co.: 1. court assessed total damages of $873,158,971 2. since some fed circuit cases suggest patent almost insures that there are no adequate substitutes (recall uniqueness), the Polaroid court might have simply refused to consider evidence of conventional camera sales altogether. At other extreme, recent antitrust thinkingpatent almost never confers “market power” in economic sense, so evid on existence of patents on elements of instant photography would be irrelevant; only evidence/testimony on cross-elasticities and such could establish absence of substitute products. 3. Polaroid steers middle course: concedes no substitutes in market for patented products, but court goes on to consider the effect of economically significant products on profit the patentee would have made absent infringement, even though products not close substitutes in strict sense. There may be no exact substitutes, but at some price and for some consumers, there are economic substitutes. These exert price discipline on patentee’s pricing. iii. Note on the Frontiers of Lost Profits Damages 1. Although statute establishes reasonable royalty as floor for patent damages, much recent action is in law of lost damages. Four novel theories used to increase damage awards in past several years a. Price Erosion i. At what price could patentee have sold if no infringement? ii. Economic theory advises monopolist will charge higher price than duopolist (seller in two-firm market). Some patentees have successfully argued that they would have sold infringer’s units plus their own, all at higher price than they actually charged. iii. Requires reliable economic proof of the market that establishes accurate context to project likely results but for the infringement. Availability of substitutes will invariably influence market forces defining the “but for” market place. Substitute need not be openly on sale, just need proper economic proof of availability. Grain Processing. b. The “Market Share” Rule i. Market share= percentage of market for a product or service that a company supplies. ii. When more than two sellers share market and at least one in a “non-infringing competitor of patentee, would thing element of absence of noninfringing substitutes would be missing. Clever argument overcomes this—what would have happened if infringer had not been in market. 1. theory assumes that patentee’s market share relative to noninfringer would have remained same in absence of infringerassume patentee would have same percentage of infringer’s sales as patentee made in overall market. In other words, presence or absence of noninfringing substitutes does not prevent patentee from laying claim to at least some of infringing sales. c. Lost Sales of Unpatented Components or Products i. Infringer’s presence cost sales of these, losses are compensable ii. Analyzed under “entire market value” rule, which directs court to ascertain whether unpatentable components at issue are functionally integral to an overall product whose consumer demand is based on the patented component iii. Idea is that unpatented component would naturally and normally be sold along with patented, thus patentee deserves compensation for lost sales of both. d. Post-Expiration Sales i. Theory that infringement during term of patent gave infringer head start on post-expiration sales since infringer did not have to start up production and marketing after patent expired. An “accelerated reentry theory” I. Design and Plant Patents a. § 101 is subject matter provision of what is referred to as the utility patent statute. Most patents issued in U.S. are utility ones. Several other provisions cover related material, most importantly designs and certain types of plants. b. Design Patents i. Introduction 1. design patent protects aesthetic appearance of product rather than its functional features. 2. obtained for wide range of products including: shoes, hats, furniture, tools, packaging, TVs, cars, computer graphics 3. overlaps with copyright, TM, unfair competition law 4. Design patent system criticized as ineffective and in need of reform: long processing, high fees, strict vague requirements, judicial hostility. Courts recently more receptive. 5. appearance, rather than utility, is crucial factor 6. Design may consist of surface ornamentation, configuration, or combination of both. 7. issued for 14 year term. Can be obtained for “any new, original, and ornamental design for an article of manufacture” most provisions relating to patents for inventions also apply to these. § 171 a. article of manufacture broadly defined to include: silverware, furniture, cement mixers, containers for liquids. b. One court said manufacture is anything made by the hands of man from raw materials whether literally by hand or by machinery or by art c. May be obtained for only part of an article (i/e shank of a drill bit) ii. Requirements for Patentability 1. Design must meet these requirements: a. Novelty b. Originality c. Nonobviousness d. Ornamental e. Not dictated by functional consideration 2. PTO definition of design on p. 308. 3. Novelty a. No prior art shows exactly the same design b. Novel if ordinary observer viewing design as a whole would consider it different from (rather than modification of) an already existing one. c. §102(b): one year novelty grace period allows patent for design as long as design has not been published anywhere or sold or displayed w/in US more than one year before app filed. Gives designer opportunity to test market before incurring expense of app 4. Nonobviousness a. Requires exercise of inventive or originative faculty b. Graham test can apply to design patents, nonobviousness measured in terms of a “designer of ordinary capability who designs articles of the type presented in the application i. Graham test, again, requires court to ascertain scope and content of prior art, differences between prior art and claim at issue, and the level of ordinary skill in the art. ii. Design standard allows for objective evidence of expert testimony from designers in field to be used to prove nonobviousness. c. Fed Circuit has emphasized presumptive validity of design patent, places burden on challenger to come forward with clear and convincing proof of nonobviousness. d. To find obviousness, reference must be made to prior art with same overall appearance of patented design, rather than combination of features from several references. e. Objective secondary considerations also apply to design patents. 5. Ornamentality a. Must create more pleasing appearance b. To satisfy requirement, must be “the product of aesthetic skill and artistic conception.” c. Has been met by articles outside realm of traditional art. d. Number of cases have denied patentability to designs concealed during normal use of object on basis ornamentality requires to be visible while object in normal and intended use. 6. Functionality a. If design “primarily functional rather than ornamental,” or is “dictated by functional considerations” it is not patentable. b. This rule furthers purpose of d.p. statute, which is to promote the decorative arts c. Additionally prevents granting monopoly to functional features that do not meet requirements of a utility patent. d. Fed Circuit says design may have functional components as long as design does not embody a function that is necessary to compete in the market iii. Claim Requirements and Procedure 1. high cost 2. pendency time approx 2-3 years 3. criticized as “unsuited to the fast-moving but short-lived product cycle characteristic of today’s market for massprodduce consumer goods.” iv. Infringement 1. standard: “if in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase on supposing it to be the other, the first one patented is infringed by the other.” Gorham. Key factor is similarity, rather than consumer confusion. 2. second prong of infringement analysis is the “point of novelty” test. Distinct from issue of similarity. The similarity found by the ordinary observer must be attributable to the novel elements of the patented design that distinguish it from prior art. (Scope of patented claim and its points of novelty are determined by examining field of prior art. ) 3. after determining scope of claim, focus is only on protectable aesthetic components of patented design. Permits excuses for borrowing commonplace, generic ideas while adding sufficient variation to protectable elements of design. 4. indication is that Fed Circuit willing to extend design patent protection beyond literal infringement and protect design concept itself. c. Plant Patents i. The Plant Patent Act 1. 35 U.S.C. §§161-164 a. Extends protection to inventors and discoverers of “any distinct and new” variety of asexually reproducing plant. b. Plant used in lay sense, bacteria not eligible. c. Except as otherwise provided, provisions applying to utility patents apply to plant ones. d. Elements of patentability are different: i. Distinctness substituted for utility. Measured by examining characteristics that make plant entirely distinguishable from other existing plants. ii. Nonobviousness difficult to apply. Viewed as requirement for invention resulting in substantial distinctions in the plant. iii. Exempt from written description requirement. e. Protection they offer: exclusive right to reproduce plant asexually. f. Each patent app may include only one claim directed specifically to plant shown and described. g. Doctrine of Equivalents cannot be used with them. ii. The Plant Variety Protection Act 1. 7 U.S.C. §§2321-2582 2. parallels PPA for plant varieties that are sexually reproduced by seed. Applicants not awarded patent, but Certificate of Plant Variety Protection. 3. variety needs distinctness, uniformity, and stability. Distinctness most critical—“clearly differs by one or more identifiable morphological, physiological or other characteristics.” 4. PVPA registration system, but has statutory bars, content requirements for apps, requirement for seed deposit. So kind of like utility patent. But, special features: a. Mandatory license, series of statutory exemptions for saved seed, exemption for sales by farmers (to other farmers), research exemption. 5. Certificate grants breeder right to exclude others from “selling the variety, or offering it for sale, or reproducing it, or exporting it, or using it in producing a hybrid or variety therefrom. Protection lasts 18 years. Ip rights have affected growth and structure of seed industry. Critics say have accelerated centralization and loss of economic power by small farmers. Some poor tropical countries say they own genetic material from plants growing inside borders, charge other countries royalties to remove for research or development of new products. Trademarks Purpose of Trademark Law a) Source identification : permit consumers to identify the source of goods or services. Brand Source Identification. b) Eliminates consumer confusion, or reduces related transaction costs: trademark law ensures that consumers are able to rely on marks in exercising their preferences by prohibiting competitors from using marks in a way that confuses consumers about the source of a product or service (1) consumers benefit b/c they are able to identify and obtain the goods or services that they want, quickly (2) businesses benefit b/c trademark law helps them create and protect business good will good will: business’ image, good reputation, and expectation of repeat patronage which, while intangible, can be extremely valuable-cannot be nakedly licensed, (without underlying business-may change in future because of TRIPS evident of move towards property rights.) Relationship between Common Law (enforced by the states) and Federal Law under the Lanham Act c) state: trademark law originated as one of several related doctrines comprising the common law (1) relief through unfair competition (2) still alive today – but get more protection through federal registrationsttat protection is local and extends only to areas in which the company has developed a reputation. d) federal: congress passed a series of statutes which incorporated and built up on the common law trademark doctrine (1) relief through the Lanham Act: section 1051: enhances the common law by providing a system for registering marks (2) registration provides a number of benefits such as (a) rights in a broader geographic area (b) legal presumptions of trademark validity (including possible incontestability) Brief Overview of TM Theory e) Trademarks do not depend on novelty, invention, discovery or work of the brain. (1) protection is awarded merely to those who were the first to use a distinctive mark in commerce (2) certain marks are unprotectable b/c they are generic terms describing an entire class of goods. Allowing one user to appropriate these marks would give that user an unfair degree of control over the product the generic term describes. (Can competitors fairly describe their product without mentioning the TM?) f) Fundamental principle of TM law have essentially been ones of tort (1) Misappropriation of the goodwill of the TM owner and deception of consumer (2) TM are not analogous to property rights, but there are some twigs that resemble property rights (3) Rights acquired w/use of TM in commerce and continue as long as use continues (a) 1988: now possible to register and protect TM based on intent to use mark in commerce at some time in next 3 years. But right remains inchoate until use actually happens g) infringement (1) Under Lanham act, test is likelihood of confusion. (2) can’t get away w/just saying the mark is similar – ultimate question is are consumers going to be confused and if no, defendant is free to make use of the mark. (3) This act provided advantages for registering TMs and giving separate protection for unfair methods of competition for unregistered marks. TMs and Advertising h) Differentiate between product’s simple search characteristics (price, color, shape, size and product category) and its more complex experience aspects such as taste or long term durability (1) Former (Search Characteristics) are aspects of product quality that consumers can verify by inspecting the product before they buy it. It is easy to see why firms would invest in advertising those qualities: they are basic aspects of a product and consumers can easily verify whether claims are true. (2) Experience characteristics by contrast, cannot be cheaply investigated before purchase. They will be discovered only through use. (a) Wine is an obvious example, but many other goods share the same characteristic. Courts and commentators speak of economic value of consumer’s association w/a firm and its TM as the firm’s goodwill. Goodwill can be thought of as the residual benefit the firm gets from these types of investments. What can be protected as a Trademark: Lanham act distinguishes in form between several different types of marks: i) Trademarks (1) TMs are the words, phrases, logos, and symbols that producers use to identity their goods-and in the case of a special thread that had secondary meaning-smell. (According to Qualitex, a color must always achieve secondary meaning-probably true for smell, but maybe not sound…) (2) goal: indicate the source of the goods even if the source is unknown (3) the term TM includes any word, name, symbol or device or any combination thereof – (a) used by a person, or (b) which a person has a bona fide intention to use in commerce and applies to register on the principal register established by this Act, (c) to identify and distinguish his /her goods including a unique product from those manufactured or sold by others and to indicate the source of the goods even if that source is unknown (4) word, name, symbol or device: range is great – can include (a) slogans (b) distinctive features of the product’s packaging (c) sounds and smells (Law and Order sound) j) Service Marks: same as trademarks except that they identify and distinguish services rather than products (1) Term TM does not cover another closely associated type of business identifier, the service mark (2) goal: indicate the source of the services, not the service (3) Service mark – term SM means any word, name, symbol, or device or any combination thereof (a) used by a person, or (b) which a person has a bona fide intention to use in commerce and applies to register on the principal register established by this Act, (c) to identify and distinguish the services of one person, including a unique service, from the services of others and to indicate the source of the services. Titles, characters, names and other distinctive features may be registered as service marks notwithstanding that they or the programs may advertise the goods of the sponsor. (4) subject to many of same rules as TMs 1. One issue that sometimes arises involves attempts to register service marks for services closely related to sale of goods. 2. In general where services are expected or routine in connection w/the goods such registrations are rejected – must show service is sufficiently separate from good 3. test is whether the service is normally expected and routinely rendered in furtherance of the sale of goods – if yes then insufficient 4. The theory is that otherwise closely related registrations will proliferate, clogging the register. k) Trade Names (1) Rather than goods or services, trade names ID the company itself. (2) can’t be registered under Lanham act unless they actually function to ID the source of particular goods or services rather than merely IDing the company (3) However trade names are generally registerable in state offices, and state /federal common law may provide protection against confusingly similar company names. l) Certification Marks: words, names, symbols, devices, or combinations thereof used by person other than its owner, or which its owner has a bona fide intention to permit a person other than the owner to use in commerce and files an application to register on the principal register established by this chapter to certify regional or other origin, material, mode of manufacture, quality, accuracy, or other characteristics of such person’s goods or services or that the work or labor on the goods or services was performed by members of a union or other organization (1) characteristics: might include such things as origin in a particular geographical region, composition from a particular material, quality, accuracy or creation through labor union etc. (2) These marks are generally used by trade associations or other commercial groups to ID a particular type of goods (3) Certification marks serve to certify conformity with centralized standards. (4) They are meant to bear the seal of approval of a central organization, so they can be cancelled on the ground that the organization no longer exercises sufficient control over its members to assure consistent product standards (5) I.E. french winemakers have such a mark in champagne. Only sparkling wine made w/in that region (Champagne) in France and complying with the French law governing winemaking can legally call itself champagne.. m) Collective Marks or Certification Marks: TM or SM (1) used by the members of a cooperative, an association, or other collective group or organization, or (2) which such cooperative, association, or other collective group or organization has a bona fide intention to use in commerce and applies to register on the principal register established by this chapter and includes marks indicating membership in a union, an association, or other organization. (3) If a collective group markets its own goods /services under a mark that mark is not a collective mark but a TM or SM. (a) membership marks: adopted for the purpose of indicating membership in an organization such as a union, professional society, or a social fraternity Trademarks or service marks: trademarks or services adopted by a collective organization such as a co-op for the use by its members in selling their individual goods or services distinguishing their goods or services from those of nonmembers. Collective never sells anything but it may advertise or promote goods sold by members (or services) Certification Marks are not used in commerce in relation to a particular good, but a standard of quality-kind of like the Good Housekeeping Seal. Trade Dress and Product Configuration n) Protection for: (1) the design and package of materials and even the designand shape of a product itself, if the packaging or product configuration serve the same source identifying function as TMs. (2) You can register both Trade Dress and product configurations as TMs under the act. (3) However, b/c of their complex and changing nature most Trade Dress and product configuration are protected w/out registration under section 43(a) of the act. 1. 43(a)(1)any person who, on or in connection w/any goods /services, container for goods, uses in commerce a word, term, name, symbol, or device or any combination thereof or any false designation of origin, false, or misleading description of fact or false or misleading representation of fact, which i. (A) Is likely to cause confusion or to cause mistake, or to deceive as to the affiliation, connection, or association of such person w/another person or as to the origin, sponsorship, or approval of his/her goods, services, or commercial activities by another person, or ii. (B) in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his /her or another’s goods, services, or commercial activities, 2. shall be liable in a civil action by any person who believes that he /she is or is likely to be damaged by such act (4) Section 43(a) is commonly referred to as providing federal common law protection for TMs and related source identifiers Special Considerations for Color, Fragrance and Sounds: Qualitex – dry cleaner pads in green and gold are at issue. (5) Issue: whether Lanham act permits registration of a TM that consists purely of a color. Held: Court concludes that sometimes color meets ordinary legal TM requirements. When it does, no special legal rule prevents color alone from serving as a TM. Pads at issue meet requirements & are protectable (6) A symbol or device might be anything capable of carrying meaning and this can include color. (7) Color is not arbitrary or fanciful. However, over time customers may cone to treat a particular color on a product or its package as signifying the goods – to indicate their source. It thus acquires secondary meaning. (8) Protection for color is easiest where there is no necessary relationship between the color and the product. I.E. pink insulation – insulation had always been clear but made it pink, etc. People associate it with that company (9) Rule: When color attains secondary meaning and thus identifies or distinguishes a particular brand (and thus indicates its source) it is protectable as a TM (10) Court says although some color plays important role (not related to source ID) in making product more desirable, sometimes it does not. fact that sometimes color is not essential to a product’s use or purpose and does not affect cost /quality indicates that functionality does not create an absolute bar to use of color alone as a mark. Color of pads has no functionality here-different than in pharmaceutical case. (11) If color serves useful purpose can’t protect it – don’t want to put competitiors at disadvantage b/c have to choose other color. I.E. pill colors can be copied. Color and shape serve function – identifies an entire class of goods (pill) Establishment of Trademark Rights o) Not all identifying marks get protection though (1) Only certain TMs get legal protection: (2) Some tms are inherently distinctive – i.e. apple for computers – no one would associate apple w/computers before the company (a) For marks that are inherently distinctive, protection is automatic. Don’t have to prove that consumers associate it w/you first (secondary meaning – this slogan belongs w/this product). (3) Whether an identifying name or phrase may be Trademarked at all and degree of protection given to it depends on the strength of the mark (a) This in turn depends on among other things the classification of the mark as either (b) Scale For Word Marks (