It’s Not Enough, But Every Journey Begins with One Step.
You can’t breath in space without oxygen. And these days, it can feel like Alice and the AIA sucked all the air out of the room for patentees. But there are signs of hope.
On Sept. 28, I took a deep breath of fresh air after a Federal Circuit reversed a ruling of the U.S. District Court (N.D. Cal.) in a precedential decision favoring AddyHart’s client Cooperative Entertainment, Inc.
SCOTUS’s warped analysis in Alice continues to demand that patent practitioners educate and support the Federal Circuit, the PTO, and the Congress—to restore confidence in the art and practice of invention.
Before writing his world-famous post-nuclear-apocalypse novel On the Beach in 1957, English novelist Nevil Shute—by then an emigré to Australia—published a novel called A Town Like Alice. Maybe you’ve seen the movie. It’s a well-made tale, and all ends well.
Then the Federal Circuit issued its ruling in Berkheimer v. HP, followed by its decision in Aatrix Software v. Green Shades. Glimmers of hope?
Maybe. Survival rates at the PTAB are improving. But the cost and time necessary for a patentee to claw their way back to the district court — that is, just to get back to Square One — is too much for many. I’m not the only one who believes it’s having a negative effect on our nation’s innovation ecosystem. Last week, many colleagues who fight in the dust of the patent arena shared ideas and insights at the 2018 Leahy Institute of Advanced Patent Studies Conference (where the sunrises truly are spectacular, btw, and I also took a moment to catch this lovely afternoon shot!).
This past month, with our year still newly begun, I thought to reach out to my friends and colleagues, clients and other contacts, as I considered what the year ahead might bring. I greatly appreciate the many warm responses I received.
One response came from Gene Quinn, a passionate voice in defense of innovators who shares my concerns about what’s been happening to innovative companies and entrepreneurs since passage of AIA and the Supreme Court’s Alice decision. Gene kindly invited me to adapt my email to him as a post for IPWatchdog.com. Thanks to Gene for the opportunity to share it.
Strange days. And still waiting for the sun.
MIMI
I’m optimistic about the court’s future approach to reviewing such decisions!
In Berkheimer v. HP on Feb. 8, the Court reversed summary judgment of ineligibility with respect to some of Berkheimer’s claims. This after having noted—hold your breath!— that whether a claim element is well-understood, routine, and conventional is a question of fact. Thanks: I needed that!
This Wednesday, Feb. 14, it happened again in Aatrix Software v. Green Shades, with the Court vacating a Rule 12 dismissal for lack of patent eligibility because of issues of claim construction and fact, which must be interpreted for Rule 12 in the light most favorable to the non-movant.
A Valentine for the Federal Rules of Civil Procedure! An approach based on the question of fact!
I hope these decisions mark the beginning of a broader recognition of the underlying facts related to patent eligibility and the proper procedure required for Rule 12 dismissal. And that they don’t just end up being two rare survivors in the carnage that has resulted from the Alice decision.
More detail in my piece on IPWatchdog.
MIMI
On Feb. 6, our client Thales Visionix prevailed at the Federal Circuit in a long-running dispute with infringer Elbit Systems of America, on the key claims of a patented technology for the helmet-mounted display used in the F-35 Joint Strike Fighter.
It’s our third win in this dispute, and the patentee hasn’t even been on offense yet.
In 2014, Thales filed its original infringement action in the U.S. Court of Federal Claims (CFC), arguing that defendant Elbit Systems had supplied to the government and its contractor Lockheed Martin technology that infringes Thales’ U.S. Patent No. 6,474,159 (“the ’159 Patent”). In response, Elbit and the government asked for and received a “pleadings dismissal” because, in their view, the ’159 Patent did not claim patent-eligible subject-matter.
Contemporaneously with the matter pending at the CFC, Elbit sought inter partes review of various claims of the ’159 Patent. So, as is often the case these days, Thales was fighting the validity battle on two fronts: appeal of the CFC decision and review at the PTAB.
In late 2016, Thales turned the tables. First, the PTAB’s decision favored Thales. The Board found, inter alia, that Elbit failed to demonstrate by a preponderance of the evidence that our client’s key claims would have been obvious over prior art. See Elbit Systems of America, LLC v. Thales Visionix, Inc., IPR2015-01095 (P.T.A.B. Oct. 14, 2016).
Then, last March, the Federal Circuit reversed the CFC pleadings dismissal, determining that the ’159 Patent claims were not abstract under Alice. This was a signal win for us, given the preponderance of cases—more than 90%—that have failed on appeal to the CAFC since the Alice ruling.
After these two decisions, which took a long time and a lot of work just to get back to square one at the CFC, this week the Federal Circuit affirmed the PTAB’s decision on the ’159 Patent.
The technology disclosed in the ’159 Patent is some of the coolest I’ve seen. That’s not surprising, because the F-35 Lightning II has the most advanced communications suite of any fighter ever built. Its helmet-mounted, heads-up display allows a moving object (the fighter pilot’s head) to know its position relative to other moving objects (i.e., the enemy) while moving rapidly through space.
Speaking of knowing your position (and hitting the target!), kudos to my partner Dan Konieczny, who argued our case at the Federal Circuit this January.
Here’s the decision written by Judge Wallach. Here’s a short recap at Law360.
MIMI
EI’s case is of substantial import to all inventors and patent holders, and the company is requesting amicus support. I hope readers will consider joining the fight.
A Federal Circuit panel affirmed the District Court’s decision to invalidate Evolutionary Intelligence’s patents, then denied a petition for rehearing and rehearing en banc. This despite EI’s having won several IPR challenges made by Apple, Twitter, and Yelp.
The positions are outlined in this Request for Amicus Support.riefs would be due on or around Nov. 22. Your notice to opponents would be due on or around Nov. 10.
Relevant Materials
Here is the District Court Decision holding EI’s patents not eligible, and the Federal Circuit Decision affirming the district court. Here are US Patent No. 7010536 and US Patent No. 7702682. Here’s the PTAB Decision upholding U.S. Patent No. 7010536.
Background
Since Alice, district courts have invalidated hundreds of patents on the pleadings. Such cancellations offer patent-holders no opportunity for fact-finding, claim-construction briefing, or any of the other usual protections offered in patent litigation. The result is significant devaluation of patent portfolios.
Evolutionary Intelligence v. Sprint Nextel concerns artificial intelligence inventions, directed to dynamically optimizing mobile search results and notifications according to spans of time and physical movements through space.
For example, the invention enables a person standing in a particular spot at, say, 7:00 am to know immediately the five closest restaurants currently serving breakfast. While this feature seems common now, the record shows this was “groundbreaking” when the patents were filed.
If you have any questions or wish further information, please contact me.
That’s the issue the U.S. Supreme Court will consider in Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, et al., No. 16-712 (2017).
On August 31, Tabet DiVito & Rothstein filed an amicus brief on behalf of the American Intellectual Property Law Association (AIPLA) in that case. I drafted the brief in support of neither party, requesting that the Court confirm the constitutionality of the PTAB’s inter partes review process.
The brief argues that Congress’s creation of an adjudicatory process within the USPTO for the limited purpose of reviewing and, if necessary, cancelling improperly issued patents violates neither the Constitution’s separation of powers nor its Seventh Amendment guarantee of a right to a jury trial. The brief also acknowledges that, while not unconstitutional, the current implementation of PTAB procedures is not ideal and does not seem balanced. However, AIPLA recognizes that the PTAB has been willing to work with the bar to rectify imbalances.
Oil States v. Greene’s Energy has far-reaching implications for all types of post-grant review—as indeed for non-Article III courts. A date for argument is not yet scheduled.
MIMI
[T]he Federal Circuit is the only circuit where every judge resides in the same location, generating an unparalleled culture of collegiality and collaboration. It is also the only circuit with nationwide jurisdiction, so its opinions control across America and are not geographically limited like other circuits’ decisions.
SAP will have to pay the patent infringement judgment, which has now grown to $391 million due to accrued interest, even though the USPTO’s Patent Trial and Appeal Board is reviewing the validity of the patents at issue.
It looks to me like this type of issue will continue until the PTAB catches up to the district court in hearing contentious patent-related issues.
MIMI
Check out this news piece on Law360.com.
The Federal Circuit under Judge Michel achieved a measured and thoughtful approach to patent appeals—and a deep appreciation for the importance of innovation in American business.
The Court when I clerked there also was fully able to address abusive patent litigation, able to distinguish when spurious appeals were brought before it.
Bravo, Judge! Let the courts do what they do best.
MIMI
