In 1989, Jacob Krippelz invented and, in 1991, was issued a patent (U.S. Patent No. 5,017,903) for a downward shining light attached to an automobile’s side view mirror.[2]  Following issuance, Krippelz offered to license the invention to Ford; however, the car manufacturer indicated it was not interested in the invention.[3]  Fast forward to 1997, Ford began manufacturing and selling its Explorer SUV and other Ford models with optional “puddle lights.”  These “puddle lights” were also attached to the automobiles side view mirrors and generally faced downward thereby illuminating the side of the vehicle. [4]  In 1998, Krippelz sued Ford for patent infringement.[5]

Concluding litigation that occurred over the course of several years, the District Court granted Krippelz’s motion for summary judgment of infringement at which point the case went to trial on validity and damages.[6]  At trial, Ford argued that the patent was anticipated by a French patent which, though missing from the ‘903 patent prosecution history, taught all the limitations of the ‘903 patent.[7]  Krippelz countered offering expert testimony that the French patent lacked two limitations of the ‘903 patent, namely a “conical beam of light” and “a lamp located ‘adjacent’ to the vehicle window.”[8]  The jury returned a verdict in favor of Krippelz and awarded nearly $56 million in damages.[9]  Ford moved for judgment of invalidity as a matter of law, and, when that was denied, appealed.

In order to grant a judgment as a matter of law (“JMOL”), the court must determine “whether the evidence presented, combined with all reasonable inferences…is sufficient to support the verdict when viewed in the light most favorable to the [nonmovant].”[10]  Additionally, in order to show invalidity due to anticipation, “the accused infringer must show by clear and convincing evidence that a single prior art reference discloses each and every element of a claimed invention.”[11] (emphasis added)  The District Court denied the motion for JMOL based on “two potential grounds on which a jury could find for Mr. Krippelz,” namely the lack in the French patent of the “conical beam of light” element and the lamp “adjacent to window” element of which both were found in the ‘903 patent.[12]  In reaching this conclusion, the District Court relied heavily on expert testimony distinguishing the ‘903 patent and the French patent based on these two elements.[13]

In concluding that the District Court committed reversible error in denying the JMOL, the Federal Circuit first addressed the “conical beam of light” element.[14]  The Federal Circuit found that the French patent included disclosures which made it “legally insufficient to support a judgment for Krippelz.”[15]  For example, the expert testimony differentiating one embodiment was insufficient to differentiate all embodiments included in the French patent.[16]  Turning to the adjacency element, the Federal Circuit directly references the diagrams of the French patent which clearly show the lamps mounted adjacent to the side window.[17]  Concluding, the Federal Circuit reversed the District Courts denial of JMOL, vacated infringement summary judgment, and remanded for judgment in favor of Ford.[18]

 A “transitional post-grant review proceeding” to review the validity of these types of business method patents can be instituted with the Patent Office only by a real party in interest which has been sued for infringement.  Additionally, this new law can be used retroactively on patents issued before the date of enactment of the law as well as after.

 While during litigation patents have a presumption of validity, they are not granted that substantial benefit in Patent Office reviews.  This could result in a lot of business method patents being found invalid.  For example, a lot of web-based payment systems could find their patent protection disappearing.

 The exact procedures to implement this new business method patent review system are not explained in the new law.  The Director of the Patent Office is tasked with creating them prior to the one year deadline for implementation.  However, it is likely the procedures will share similarities with the new §321 which outlines post-grant review.  In the proceedings created by §321, the person accused will file a petition to have the patent reviewed and argue to have one or more claims canceled.  However, this section has a nine month limitation from being date of being granted which will not exist in the review process for business method patents.

 Additionally since only an accused infringer can initiate this review, patentees of business method patents will need to carefully consider who to file suit against.  If they broadly sue, they are opening the door and increasing the odds that one defendant will utilize this review procedure.

 However, this new review procedure is for a limited time only.  The new law takes effect one year from enactment and expires eight years after that in 2020.

The Stepan Company was the assignee of a U.S.patent[2] which taught “polyol-based resin blends and the methods of using them to create closed-cell polyurethane and polyisocyanurate-based foam.”[3]  Essentially this patent was used to manufacture thermal insulation installed in the walls of buildings.[4]  Concluding a reexamination proceeding, the patent examiner invalidated the patent’s claims as anticipated under §102(b) or obvious under §103(a).[5]  On appeal, the Board of Patent Appeals and Inferences affirmed the invalidation. 

Both the examiner and the Board relied on a prior art patent reference to either anticipate Stepan’s patent or, in combination with other references, show obviousness.[6]

However, the examiner used the prior art reference under §102(b) which includes patents or publications in existence more than one year prior to the filing date of the patent in question. On the other hand, the Board used the prior art under §102(a) which includes patents or publications “before the invention thereof by the applicant.”[7]  The examiner never put forth a §102(a) argument during the reexamination proceeding.

On appeal, the Federal Circuit Court needed to determine whether the Board had relied on a new ground of rejection when affirming the examiner’s decision.  It is well
established that “if the appellant has not had a full and fair opportunity to litigate the Board’s actual basis of rejection, the administrative validity proceedings…should be allowed to continue.”[8]  Stepan argued that since the Board raised a new ground of rejection to which it had no opportunity to respond, its administrative due process was violated.[9]  The Patent Office responded by asserting that the decision by the Board was not new ground of rejection.  Since the examiner had raised a §102 rejection during the reexamination proceeding, “the thrust of the rejection was the same.”[10]  Additionally, Stepan had had fair opportunity to argue the point before the Board.

The Court rejected these arguments.[11]  In doing so, the Court stated that by “making and relying on new fact findings…the Board relied on a new ground of rejection.”[12]  Alternatively, the Patent Office argued that by failing to request a rehearing, Stepan had waived its administrative due process.  The Court was not convinced by this argument either.  The appellant is only required to take action, and therefore prevent a wavier, after the Board makes a new ground of rejection.[13]  In this case, the Board “did not designate the new…rejection as a new ground of rejection.”[14]  Therefore, Stepan had no affirmative obligation.  In concluding, the Court vacated the Board’s decision and remanded.[15]

Trademark owners are able to file a blocking application for the domain name.  However, the applications are due by October 28^th, 2011.  In order to be eligible to block, the applicant must own a federally registered trademark and that mark must be identical to the registration they are attempting to block.  However, during this block period, adult entertainment industry companies are able to file for a domain name if they have preexisting rights.  What happens in the case of a conflict?  The domain name goes to the company in the adult entertainment industry.

From November 8^th to 25^th, companies in the adult entertainment industry can register .XXX domain names if they did not have preexisting rights.  Then on December 6^th, 2011, anyone can register a .XXX domain name. Since this could potentially lead to many cybersquatting issues, the ICM Registry, the company that sponsors the .XXX Internet top-level domain name, has established new dispute resolution procedures.  These procedures include Rapid Evaluation Service (RES) and Charter Eligibility Dispute Resolution Policy (CEDRP), but it
is unclear how these procedures will work. In lieu of those mechanisms, the only other recourse is traditional cybersquatting remedies: purchase the .XXX name, UDRP actions, or ACPA
lawsuits.

See http://www.icmregistry.com/ for more information (Note: some pictures on the site are potentially inappropriate)

The accused LYSO crystals are similar to LSO except that about 10% of the lutetium atoms are replaced with yttrium atoms.  Thus, Siemens asserts that Saint-Gobain infringes the ‘080 patent according to the Doctrine of Equivalents.  Longstanding Supreme Court precedent indicates that the proper standard of evidence for establishing infringement based on the Doctrine of Equivalents (DOE) is a preponderance of the evidence.  However, Saint-Gobain argued that, in some instances, the proper standard should be clear and convincing evidence.  Though unsuccessful, Saint-Gobain’s argument is worth considering further.

The DOE states that one may not avoid infringement by making only “insubstantial changes and substitutions… which, though adding nothing, would be enough to take the copied matter outside the claim, and hence outside the reach of law.”[4]  Logically, if a change is so “insubstantial” as to qualify as an equivalent, then the accused product should not only infringe, but should also not be separately patentable.

In this case, Siemens argued that LYSO is equivalent to LSO under the Doctrine of Equivalents.  However, another issued patent exists which claims LYSO and deserves a presumption of validity, namely the 6,624,420 patent.  Thus, according to Saint-Gobain, holding that LYSO is equivalent to LSO is tantamount to holding an issued patent invalid, which requires the accuser to meet a higher standard of evidence, i.e. clear and convincing. By this reasoning, Saint-Gobain concludes that Siemens should be required to meet the clear and convincing standard in order to establish infringement under the DOE.  The Federal Circuit disagreed with Saint-Gobain’s analysis, I believe, for good reason.

While seemingly reasonable on its face, Saint-Gobain’s syllogistic argument does not stand up to closer scrutiny.  In short, the clear and convincing standard serves two functions.  First, it protects the property rights of those who have succeeded in convincing the government that they have indeed created a novel and nonobvious invention, and have relied on the resulting patent to structure their business.  Second, it affords due deference to the Patent Office’s considered review, analysis and conclusions with regard to patentability to which it is entitled under the Administrative Procedures Act.[5]  Neither of these purposes is served by applying a heightened standard to an unrelated case.  The ‘420 patent is simply not invalid as a result of any court’s holding in this case, so the rationale for a heightened standard simply does not apply.

A hard gelatin capsule containing a temazepam formulation
consisting essentially of 6 to 8 milligrams of crystalline
temazepam having a surface area of from
0.65 to 1.1 m2/g and 95% of the temazepam
having a particle size of
less than 65 micronsin admixture with a
pharmaceutically acceptable carrier therefor.

The other claim reciting formulation is identical with the exception of teaching a composition containing 7.5 milligrams of crystalline temazepam.[2]

In 2006, Mutual Pharmaceutical Company, Inc. (“Mutual”) filed an application with the FDA for approval to manufacture and sell a generic capsule containing 7.5mg of temazepam.[3]  in light of the application, Tyco filed an infringement action against Mutual and moved for a preliminary injunction which was denied since the Court found the generic product “could not literally infringe the ‘954 patent because the [FDA application] required the surface area of the crystalline temazepam to be at least 2.2 square meters per gram.”[4]  In response, Mutual moved for summary judgment of invalidity, which the Court granted.[5]  The District Court based its conclusion on: 1) 15mg and 30mg dosages had been sold in the U.S. earlier than one year prior to Tyco’s priority date, 2) a 1983 medical reference book taught the use of dosages between 5mg and 15mg for the elderly, and 3) the undisputed fact that “physicians always seek to prescribe the lowest effective dose of any medication, particularly hypnotics such as temazepam.”[6]  From these factors, the Court found it would have been obvious to combine the 15mg dosage used in the U.S. with the dosage range contained in the medical reference book.[7]  Tyco appealed.

The question before the Federal Circuit on appeal was whether the lower dosage of temazepam, which was not fully disclosed in the prior art, was obvious to a person of ordinary skill in the art.[8]  The court noted that “where there is a range disclosed in the prior art, and the claimed invention is within that range, there is a presumption of obviousness.”[9]  However, the “presumption is rebuttable either by a showing that the prior art taught away from the invention or by a showing of new and unexpected results relative to the prior art.”[10]  Rejecting Tyco’s arguments to the contrary, the Federal Circuit found that the presumption was not rebutted by the evidence supplied by Tyco consisting of expert testimony,[11] medical drug trial publications,[12] and secondary considerations.[13]  The prior art did not teach away from the invention nor were any unexpected results achieved.  Concluding, the Court upheld the judgment finding the claims invalid for obviousness in light of the prior art.[14]

See the registration: Trenched Registration Certificate.

While trademarks in Europe can be obtained individually nation by nation, it is much more efficient to obtain a community trademark which covers the member states of the European Union (EU).  Administered by the Office for Harmonization in the Internal Market,[2] community trademarks cost around 1000 Euros (depending on how the application is filed) which is about $1400 USD and can be obtained by anyone even if they are not a citizen of an EU member state.

Further investigating the issue, below is the USPTO’s Trademark electronic Search System (TESS) record for “Trenched.”  The record shows that the application for registration was filed roughly three months ago.

 
It would make sense that a similar application would be filed in Europe around the same time; however, no “Trenched” community trademark record was found.  Due to this, it seems likely that Microsoft knew of the problem and spent the last three months or more unsuccessfully attempting to find a workable remedy.  Some potential remedies include arguing the dissimilarity between the marks, purchasing the mark from Monteiro, or renaming the Xbox game for European distribution.

This case clearly illustrates the importance of a proper and timely trademark availability search. Releasing the title in Europe could have potentially resulted in a very unpleasant trademark infringement suit for Microsoft and the game’s creator.

First-to-File
Prior to the passage of this new legislation, the United States utilized a First-to-Invent system.  Under that system, if two people “invented” the same invention, generally the first inventor would be entitled to the patent.  Under the new system in that same scenario, the first person to file the patent application would be entitled to the patent even if they were the later inventor.  The rest of the world uses the First-to-File system.  However, unlike the rest of the world, the United States patent law did and will continue to provide a one year grace period from the date of disclosure to file the patent application.  This section of the new legislation will take effect 18 months from the date of enactment, on Monday March 18th 2013, and will apply to any applications filed on or after that date.

Prior User Rights
Back in the late 1990s, the Federal Circuit decided the State Street case which opened the flood gates for business method patents.  In response to that decision, Congress enacted what became known as §273 which created a prior user rights defense against infringement of a business method patent for a person commercially using the method at least 1 year prior to the filing date of the patent.  However in the recently passed legislation, Congress has updated and expanded §273 to include all patent-eligible subject matter.  Therefore, any process, machine, article of manufacture, or composition of matter is included in this prior user defense. 

Fees & Funding
The last important change to U.S. patent law, and one that is on the minds of every patentee, is the change in how the USPTO handles fees.  Under the new law, the Director of the USPTO can adjust fees to cover Office costs.  This will likely result in an increase in fees.  Additionally, the new law provides for a 15% increase in fees immediately as of the date of enactment, as well as a $4,800 optional expedited track for patent prosecution.  However, the Act still provides for a 50% discount for small entities and introduces a 75% discount for micro entities.  A micro entity is defined as a small entity which has filed 5 or less patent applications, has made less than a certain gross income in a calendar year, and is not obligated to assign the patent to a company that made over a certain gross income in a calendar year.  Lastly, fee diversion, the practice of diverting fees collected by the USPTO for other governmental expenses, will still unfortunately be in practice.

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