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The Top 10 Patent Stories from 2018

The Top 10 Patent Stories from 2018

It’s that point as soon as once more once we look again on the earlier yr in preparation to shut the ultimate chapter of 2018 so as transfer recent into the yr forward. 2018 was a busy yr within the patent world, though change was not as cataclysmic in previous years, resembling 2012 when the PTAB and submit grant challenges started, in 2013 when AIA first to file guidelines went into impact, or in 2014 when the Supreme Courtroom determined Alice v. CLS Financial institution. It was, however, nonetheless a really fascinating yr. A yr that might be remembered within the years to return because the second in time when issues lastly began to calm down, when hope returned to the Patent Workplace, and even these judges of the Federal Circuit very unlikely to seek out innovations patent eligible started to seek out a minimum of a couple of claims worthy of passing muster underneath §101.

Personally, in 2018 I used to be acknowledged by IAM Journal as one of many prime IP Strategists on the planet for the second time, which definitely isn’t a prime story, however a recognition I’m humbled to have acquired. IPWatchdog additionally began providing coaching programs, with a patent prosecution coaching course aimed toward these with Zero-2 years of expertise, and an actual world seminar referred to as Patent Masters™. We’re wanting ahead to an excellent yr in 2019, with extra iterations of the Patent Masters™ symposium deliberate, extra patent coaching programs, and our 20th Anniversary Celebration in October 2019!

In any occasion, to provide you with the record under I’ve reviewed all of our patent articles, and have provide you with these prime 10 patent tales for 2018. They seem in chronological order as they occurred all year long. For those who’d wish to assessment my alternatives from previous years see Top Patent Stories from 2017 and Top 10 Patent Stories from 2016 and Top 10 Patent Stories from 2015.

Earlier than continuing it’s value noting two issues. First, that my listing focuses on particular and identifiable occasions. Second, there are a selection of tales value mentioning, however which simply missed the minimize for one cause or one other. The two that may in all probability be most obtrusive omissions are the Federal Circuit’s choice in Vanda Prescription drugs v. Westward Prescription drugs, 887 F.3d 1117 (Fed. Cir. 2018), and the ultimate guidelines implementing the Phillips declare development normal. With respect to Vanda, whereas it’s a pro-patent choice, the claims discovered eligible are nearly indistinguishable from these held ineligible in Mayo, so it appears nearly sure a special panel of the Federal Circuit would have dominated in another way. Thus, all Vanda did was appear to create uncertainty, which can be good for settlements, however doubtless not a repeatable choice. As for the Phillips normal, whereas it makes good sense for the PTAB to be utilizing the identical declare development normal as utilized in federal district courts, many have questioned whether or not it can make any actual distinction in outcomes. Nonetheless, it’s a huge occasion and would have been 11th on my listing. Had an opportunity to Phillips been accompanied by patent claims being presumed legitimate and requiring clear and convincing proof to be declared invalid on the PTAB, that would definitely be worthy of prime 10 inclusion. Alas, that may require an modification to the statute and past the powers of Director Iancu. Thus, the banishment of BRI, whereas essential, finds itself on the surface wanting simply in at this yr’s prime 10.

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1. U.S. Patent System Falls to 12th

The United States was as soon as once more the highest ranked nation in general rating within the U.S. Chamber of Commerce’s annual International IP Index for 2018, launched in February 2018, however the rankings have been nearer than ever. The United States edged out the UK by a mere .01 factors on the Chamber scale. The U.S. place was helped by improved scores referring to copyrights and logos, however was dragged down for the sixth consecutive yr as the results of a patent local weather that the Chamber characterizes as inflicting “considerable uncertainty for innovators.”

Whereas america continues to do properly general, patent safety continues to be problematic. In 2017 the U.S. ranked 10th worldwide when it comes to providing patent safety to innovators. In 208, the U.S. fell out of the highest 10, tumbling to a tie for 12th with Italy. Nations forward of the USA for patent safety have been (so as from first place on the Chamber patent index): Signapore, France, Germany, Eire, Japan, Netherlands, South Korea, Spain, Sweden, Switzerland, and the UK.

The U.S. Chamber is predicted to launch its 2019 rating in early February 2019, with an extra slide by the U.S. patent system a definite risk.

For extra please see: U.S. Patent System Falls to 12th Place in Chamber International IP Index for 2018

 

2. Federal Circuit Decides Berkheimer & Aatrix 

On February eight, 2018, the USA Courtroom of Appeals for the Federal Circuit issued a monumental determination in Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018). The Federal Circuit held that the district courtroom erred in concluding there have been no factual questions underlying the query of regulation referring to patent eligibility of sure of the asserted claims underneath § 101. “Whether something is well-understood, routine, and conventional to a skilled artisan at the time of the patent is a factual determination,” Decide Moore wrote. “Whether a particular technology is well-understood, routine, and conventional goes beyond what was simply known in the prior art. The mere fact that something is disclosed in a piece of prior art, for example, does not mean it was well-understood, routine, and conventional.”

“At this stage of the case… there is at least a genuine issue of material fact in light of the specification regarding whether claims 4-7 archive documents in an inventive manner that improves these aspects of the disclosed archival system,” Decide Moore wrote. “Whether claims 4-7 perform well-understood, routine, and conventional activities to a skilled artisan is a genuine issue of material fact making summary judgment inappropriate with respect to these claims.”

Then on February 14, 2018, the Federal Circuit issued a choice in Aatrix Software program v. Inexperienced Shades Software program, 882 F.3d 1121 (Fed. Cir. 2018), which discovered that the district courtroom erred in making use of the Alice two-step validity check on the movement to dismiss stage of the pleadings. The Federal Circuit vacated the choice of the district courtroom on the movement to dismiss, and in addition reversed the district courtroom’s denial of a movement by plaintiff Aatrix for depart to file a second amended grievance. The panel majority of Circuit Judges Richard Taranto and Kimberly Moore, who penned the opinion, acknowledged that the Federal Circuit has held that patent eligibility could be decided on the Rule 12(b)(6) stage. Nevertheless, the district courtroom granted the dismissal prior to say development “in the face of factual allegations, spelled out in the proposed second amended complaint, that, if accepted as true, established that the claimed combination contains inventive concepts and improves the workings of the computer.”

 

three. USPTO Points Berkheimer Memo

Berkheimer completely deserves to take up two spots on this prime ten record for 2018. It was a monumental choice, however one which strictly didn’t have to be adopted by the Patent Workplace. For instance, the Patent Workplace doesn’t comply with commonplace for figuring out indefiniteness set forth within the Supreme Courtroom’s determination in Nautilus, Inc. v. Biosig Devices, Inc., 134 S.Ct. 2120 (2014). As an alternative, the Workplace believes the right check for indefiniteness stays the Federal Circuit in In re Packard, 751 F.3d 1307 (Fed. Cir. 2014), which was determined previous to the Supreme Courtroom’s Nautilus choice. It’s because the Supreme Courtroom has beforehand defined the Workplace can have a extra restrictive check when permitting patents than can be utilized in a litigation context. Subsequently, though I and others would definitely disagree, an argument could possibly be made that the procedural posture of Berkheimer as a patent infringement litigation matter won’t have direct applicability to the Workplace.

However what may need been, Director Andrei Iancu, who had been on the Patent Workplace for just some days by the point Berkheimer was determined, used the clear educating and instruction of the case — that what’s properly understood, routine and/or conference is a query of reality — to use throughout the board and into the patent prosecution universe. By April 2018, the Workplace issued recent §101 steerage, which turned often known as the Berkheimer memo. The Berkheimer memo took a decidedly patent pleasant strategy to the §101 inquiry. Instances beforehand thought lengthy misplaced have been out of the blue receiving Notices of Allowance. Instances up on Pre-Attraction Temporary Conferences have been being issued. Issues have been totally different for nicely written purposes in lots of Artwork Models on the Workplace since Berkheimer. Subsequently, each the Federal Circuit choice and the Workplace steerage on the matter function two separate and critically essential factors for 2018.

 

Four. Supreme Courtroom decides Oil States

On April 24, 2018, the USA Supreme Courtroom issued its extremely anticipated determination in Oil States Power v. Greene’s Power Group, 138 S.Ct. 1365 (2018), which requested the Courtroom to think about whether or not post-grant challenges to issued patents at the Patent Trial and Attraction Board (PTAB) of the USA Patent and Trademark Workplace (USPTO) are constitutional beneath Article III and the Seventh Modification of the U.S. Structure. As anticipated by many, in a 7-2 determination, the Courtroom discovered that post-grant challenges, particularly inter partes evaluation (IPR) challenges, are constitutional.

Whereas the Supreme Courtroom tried to go away open the faint risk that they weren’t foreclosing the likelihood that patents are not any longer property rights, the reality of the matter is the Supreme Courtroom’s choice in Oil States successfully ends the dialogue. Patents will not be property rights and won’t be property rights till Congress overrules Oil States.

Quite inexplicably, the Trump Administration argued that patents are a authorities franchise, and that’s, in truth, what the Supreme Courtroom dominated. Justice Thomas, writing for almost all, stated that each one inter partes evaluate includes is “reconsideration of the Government’s decision to grant a public franchise.” Thus, patents aren’t property rights regardless of what the statute says on the contrary, and regardless of what the Supreme Courtroom themselves have dominated on the contrary beforehand.

For extra please see:

 

5. Supreme Courtroom decides SAS Institute

On April 24, 2018, the Supreme Courtroom issued a choice in SAS Institute Inc. v. Iancu, 138 S.Ct. 1348 (2018). In a 5-Four majority dominated that there isn’t any authorization within the statute for the Patent Trial and Attraction Board (PTAB) to partially institute a petition for inter partesreview. Thus, the Supreme Courtroom held that when the Patent Workplace institutes an inter partes evaluation it should determine the patentability of all the claims the petitioner has challenged.

As defined by Justice Gorsuch, writing for a 5-Four majority, the plain textual content of §318(a) resolves this case. The language of the statute is “both directive mandatory and comprehensive. The word “shall” usually imposes a nondiscretionary obligation, and the phrase “any” ordinarily implies each member of a gaggle. “So when §318(a) says the Board’s final written decision “shall” resolve the patentability of “any patent claim challenged by the petitioner,” it means the Board should addressevery declare the petitioner has challenged,” Gorsuch wrote. Thus, §318(a) signifies that the Board should tackle each declare the petitioner has challenged.

Moreover, the USPTO argument that there’s “partial institution” energy on the prerogative of the Director is unfounded. “The Director’s claimed “partial institution” energy seems nowhere within the textual content of §318, or anyplace else within the statute for that matter,” Gorsuch wrote. “And what can be found in the statutory text and context strongly counsels against the Director’s view.”

“§318(a) categorically commands the Board to address in its final written decision ‘any patent claim challenged by the petitioner.’ In all these ways, the statute tells us that the petitioner’s contentions, not the Director’s discretion, define the scope of the litigation all the way from institution through to conclusion.”

 

6. Supreme Courtroom decides Western Geco

On June 22, 2018, the USA Supreme Courtroom issued a choice in WesternGeco LLC v. ION Geophysical Corp., 138 S.Ct. 2129 (2018). In a 7-2 determination dominated that a patent proprietor might recuperate misplaced overseas income for infringement underneath 35 U. S. C. 271(f)(2).  The query determined, as set forth within the opinion by Justice Thomas, writing for almost all, was: “The question in this case is whether these statutes allow the patent owner to recover for lost foreign profits.” Thomas merely answered the query within the opening paragraph saying: “We hold that they do.”

The dispute between WesternGeco, an organization that develops know-how for surveying the ocean flooring, and ION Geophysical Company, a competitor, dates again to late 2007. In late 2007, ION started manufacturing elements for its competing surveying system and delivery them to corporations overseas. These corporations mixed the elements to create the surveying system that was indistinguishable from WesternGeco’s patented techniques.

The opinion concludes fairly powerfully stating:

[A] patent proprietor is entitled to recuperate “‘the difference between [its] pecuniary condition after the infringement, and what [its] condition would have been if the infringement had not occurred.’” Aro Mfg. Co., supra, at 507. This restoration can embrace misplaced income. See Yale Lock Mfg. Co. v. Sargent, 117 U. S. 536, 552–553 (1886). And, as we maintain at the moment, it may well embrace misplaced overseas income when the patent proprietor proves infringement underneath §271(f)(2).

 

7. Federal Circuit Lastly Defines Actual Celebration in Curiosity Appropriately

On July ninth, the Courtroom of Appeals for the Federal Circuit issued a choice in Purposes in Web Time v. RPX Company, 897 F.3d 1336 (2018), which vacated a collection of ultimate written selections issued by the Patent Trial and Attraction Board (PTAB) invalidating patent claims held by Purposes in Web Time (AIT). The Federal Circuit panel of Circuit Judges Kathleen O’Malley, Todd Hughes and Jimmie Reyna discovered that the PTAB utilized an unduly restrictive check in figuring out the statutory which means of actual social gathering in curiosity for the needs of instituting inter partes assessment (IPR) proceedings petitioned by RPX on patents asserted towards RPX’s shopper Salesforce.

AIT filed discovery requests in search of documentation that RPX was the agent of Salesforce, which might have time-barred RPX’s IPR petitions beneath 35 U.S.C. § 315(b), the statute stopping the establishment of IPR proceedings if the petition is filed multiple yr after the date on which an actual celebration in curiosity is served with a grievance for patent infringement. Among the many related paperwork produced throughout discovery are included an RPX greatest practices information for figuring out patents to problem, a declaration from RPX’s Vice President of Shopper Relations which recognized conversations between RPX and Salesforce on the AIT patents and a historical past of funds from Salesforce to RPX which confirmed that Salesforce made a big cost earlier than RPX filed the IPRs towards AIT’s patents. The PTAB, nevertheless, instituted RPX’s IPRs regardless of AIT’s time-bar claims.

The Federal Circuit discovered that the PTAB didn’t meaningfully look at Salesforce’s relationship with RPX and the character of RPX as an entity that helps its shoppers extricate themselves from patent litigation.

“Two questions we must answer, then, are (1) what ‘right’ is being enforced; and (2) who is ‘entitled’ to enforce that right.” Decide O’Malley wrote. “In theR context of IPRs — adversarial proceedings… the ‘right’ being enforced is a petitioner’s right to seek administrative reexamination of the patentability of issued claims as an alternative to invalidating those claims in a judicial proceeding. Thus, the focus of the real-party-in-interest inquiry is on the patentability of the claims challenged in the IPR petition, bearing in mind who will benefit from having those claims canceled or invalidated.”

Thus, the query with respect to who’s an actual get together in curiosity will now appropriately concentrate on who will profit from having claims canceled or invalidated, which is a way more conventional definition of actual celebration in curiosity and in line with lots of of years of case regulation from different areas, which we all know the Supreme Courtroom prefers since they view patent regulation as not notably distinctive or particular.

 

eight. Director Iancu Speeches and Interviews

Since he was confirmed to function Beneath Secretary of Commerce and Director of america Patent and Trademark Workplace, Andrei Iancu has been touring everywhere in the nation giving speeches. He has additionally appeared a number of occasions on Capitol Hill. He has informed the Home Judiciary Committee that it’s unclear what’s patent eligible. Iancu has informed me in an interview that the present state of §101 weakens innovation. Iancu has advised business audiences that folks have a proper to know what’s patent eligible. Iancu launched new Normal Working Procedures on the PTAB after which proclaimed on the annual AIPLA assembly that it’s a new day on the PTAB. Iancu has stated that the boundaries of the patent grant shouldn’t rely upon the tribunal the place one is litigating. Iancu has additionally referred to as §101 a morass, saying that the best way out of the 101 morass is to strictly comply with what is admittedly fairly restricted steerage from the Supreme Courtroom. And Iancu has referred to as the patent troll narrative Orwellian doublespeak.

Whereas any one among these moments might not rise to a single pivotal second for 2018, collectively they relatively clearly show that the USPTO has a brand new sheriff on the town. A sheriff not afraid to be a champion for innovators looking for patents, and never simply innovators who use the applied sciences patented by others. This represents a big departure from the earlier regime on the Workplace, and is a breath of recent air that has inventors and innovators of all sizes hopeful and optimistic for the primary time in years.

 

9. Federal Circuit Says No to Tribal Sovereign Immunity in IPRs

On Monday, June 4th, the Courtroom of Appeals for the Federal Circuit heard oral arguments in St. Regis Mohawk Tribe v. Mylan Prescription drugs, a case appealed from the Patent Trial and Attraction Board (PTAB), which asks the appeals courtroom to find out whether or not tribal sovereign immunity may be asserted to terminate inter partes evaluate (IPR) proceedings on the PTAB. On July 20, 2018, the Federal Circuit, in an opinion authored by Decide Moore, affirmed the willpower of the PTAB, holding that “tribal sovereign immunity cannot be asserted in IPRs.”

“[I]mmunity does not apply where the federal government acting through an agency engages in an investigative action or pursues an adjudicatory agency action,” wrote Decide Moore. “There is not, however, a blanket rule that immunity does not apply in federal agency proceedings.”

The Federal Circuit discovered IPR to be extra like an company motion than a litigation the place personal events provoke as a result of “[t]he Director bears the political responsibility of determining which cases should proceed.” Whereas that sounds logical, it isn’t right. Whereas the statute provides the Director the authority and duty to find out whether or not to institute IPRs, that statutory duty and authority has all the time been delegated to the Administrative Patent Judges of the PTAB. Thus, the Director performs no position in any respect in deciding what instances to institute, and actually has by no means taken any motion to train discretion to step in and finish harassing filings.

The second rationale offered by the Federal Circuit pertains to the truth that the PTAB might proceed to determine petitions even when the patent proprietor doesn’t take part. The PTAB explains this energy as a result of they’ve energy over the patent. Sadly, the Federal Circuit made the identical error the PTAB made, which I beforehand identified right here.

If the PTAB is actually exercising jurisdiction over the challenged patent and never the patent proprietor that by definition means the PTAB workouts solely quasi in rem jurisdiction, not in personam jurisdiction, and even in rem jurisdiction because the panel incorrectly prompt. The significance of that is that in Shaffer v. Heitner, 433 U.S. 186 (1977), the Supreme Courtroom prolonged the notions of elementary equity expressed in Worldwide Shoe v. Washington, 326 U.S. 310, (1945) referring to in personam jurisdiction to the train of in rem jurisdiction.The Supreme Courtroom in Shaffer went additional to acknowledge the apparent: “[A]n adverse judgment in rem directly affects the property owner by divesting him of his rights in the property before the court.” Shaffer, 433 U.S. at 206. Thus, there isn’t a distinction between in rem proceedings and proceedings over the property proprietor. Thus, the PTAB determination and Federal Circuit determination have been based mostly on authorized fiction.

 

10. Revised Normal Working Procedures

After the August 2018 assembly of the Patent Public Advisory Committee (PPAC),  I wrote: “[I]f Director Iancu can truly get the USPTO to operate as one agency on the same page that would be a tremendous legacy.” On September 20, 2018, the USPTO introduced the substantial revision of Commonplace Working Procedures (“SOPs”) for the paneling of issues earlier than the PTAB (SOP1) and precedential and informative selections (SOP2). The revisions ship upon the repeated guarantees of USPTO Director Andrei Iancu to extend transparency, predictability, and reliability throughout the USPTO. These new SOPs replace the procedures based mostly upon suggestions the Workplace acquired from stakeholders, courts, legislators, and 6 years of expertise with AIA trial proceedings.

Revised SOP1 places an finish to the follow of increasing PTAB panels with out discover to the events or the general public.

Revised SOP2 creates a Precedential Opinion Panel (POP), sometimes comprising the Director, the Commissioner for Patents, and the Chief Decide of the PTAB. The POP will serve two main features: (1) it might be convened to rehear issues in pending trials and appeals, for instance on points of outstanding significance; and (2) it might help the Director in figuring out whether or not a choice beforehand issued by the PTAB must be designated as precedential or informative. It’s anticipated that the POP and the procedures described in revised SOP2 will, normally, substitute the prior follow of expanded paneling underneath SOP1, with a course of that’s extra clear and predictable. It’s also anticipated that revised SOP2 will end in extra selections being designated as precedential.

Director Iancu, and his successors, now have the facility to really create uniform, all-Workplace coverage that won’t solely have to be adopted by patent examiners, however should even be adopted by the PTAB.

 

Picture Supply: Deposit Pictures