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If You Seek or Browse and Can Find, It’s Publicly Available, but Anticipation Isn’t Obvious and Requires Notice

by McDermott Will & Emery | Feb 11, 2021 | America Invents Act, Patents

The US Court of Appeals for the Federal Circuit found that facilitating browsing of documents on a website was sufficient to support public accessibility of prior art references, but that the Patent Trial and Appeal Board cannot sua sponte invalidate a claim as anticipated under § 102 unless that specific statutory ground had previously been noticed. M & K Holdings, Inc. v. Samsung Electronics Co., Ltd., Case No. 20-1160 (Fed. Cir. Feb. 1, 2021) (Bryson, J.)

In response to M & K Holdings’ suit for patent infringement, Samsung filed an inter partes review (IPR) petition seeking cancellation of all claims of the asserted patent as obvious. The patent is directed to an efficient method for compressing video files by “decoding a moving picture in inter prediction mode,” using a motion vector to quantify where “reference pictures are used to estimate motion of a current block” over the video duration. Samsung’s petition relied on references generated in connection with the Joint Collaborative Team on Video Coding (JCT-VC), which established industry standards for high-efficiency video coding (HEVC). All three prior art references were uploaded to JCT-VC’s website before the critical date.

After the Board held all claims of the patent unpatentable, M & K appealed, arguing that the Board erred by relying on references that do not qualify as prior art printed publications under 35 USC § 102, and by finding claim 3 anticipated when the petition for IPR asserted only obviousness as to that claim.

Public Accessibility and Printed Publications

M & K argued that a person of ordinary skill could not have located two of the three prior art references by exercising reasonable diligence, and therefore the Board’s holding that those references were publicly accessible was erroneous. Specifically, M & K argued that the structure and search capabilities of the JCT-VC website (requiring navigating to the JCT-VC landing page, clicking on the “All meetings” link and selecting a particular meeting in order to access documents, without any explanation that the “All meetings” label contains a document repository, and with no search functionality on the landing page or the “All meetings” page) meant that even if a user happened to navigate to a meeting page of the website, the user could not search documents by content, but could search only by date, title and number.

The Federal Circuit disagreed, explaining that public accessibility does not require a website’s landing page to have search functionality. Instead, “given the prominence of JCT-VC, the dispositive question is whether interested users of the JCT-VC website could have located [the references] through reasonable diligence.” The Court agreed that substantial evidence supported that interested users could have done so.

Regardless of whether the website described itself as a document repository, the Federal Circuit noted that a skilled artisan browsing the JCT-VC website would understand that it was structured to serve the JCT-VC’s purpose of developing HEVC standards through member meetings and communications. Therefore, a skilled artisan browsing the JCT-VC website would have realized that documents are hosted [...]

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Eight-Month Delay on Transfer Motion Ruling Is “Egregious,” Warrants Stay

by Paul Devinsky | Feb 11, 2021 | Patents

The US Court of Appeals for the Federal Circuit issued a rare grant of a mandamus petition directing a district court to stay proceedings until ruling on a pending motion to transfer, stating that the district court’s eight-month delay in ruling on the motion while allowing substantive issues to proceed “amounted to egregious delay and blatant disregard for precedent.” In re SK hynix Inc., Case No. 21-113 (Fed. Cir. Feb. 1, 2021) (Moore, J.) (non-precedential). The district court denied the transfer request the following day, and the petitioner asked the Federal Circuit to again stay the proceedings until it completed briefing on a new mandamus petition to compel transfer, which the Federal Circuit denied without prejudice. In re SK hynix Inc., Case No. 21-113 (Fed. Cir. Feb. 3, 2021).

Netlist and SK hynix are competitors in the memory semiconductor space. Netlist sued SK hynix for patent infringement in the US District Court for the Western District of Texas. SK hynix moved to transfer the case to the US District Court for the Central District of California. The parties completed briefing on the transfer motion in May 2020. The district court ordered the parties to engage in extensive discovery and scheduled a Markman hearing for March 2021. On January 6, 2021, after SK hynix moved to stay proceedings pending the motion to transfer, the district court instructed the parties to proceed with all deadlines while jurisdictional issues were resolved in parallel. SK hynix then filed the mandamus petition seeking to direct the district court to transfer the case, or alternatively, to rule on SK hynix’s pending motion to transfer. The district court soon issued an order setting a hearing on the transfer motion for February 2, 2021.

On February 1, 2021, the Federal Circuit granted the mandamus petition and directed the district court to stay all proceedings concerning the substantive issues in the case, including discovery, until the district court issued a ruling on the transfer motion. In its Order, the Court recognized that mandamus may be used to correct an “arbitrary refusal to act” by a district court on a transfer request. Although a district court has discretion in handling its docket, a motion to transfer “should unquestionably take top priority.” The Court characterized the district court’s handling of the transfer motion as amounting to “egregious delay and blatant disregard for precedent,” finding that the motion “lingered unnecessarily on the docket” while the parties were instructed to proceed with the merits of the case.

The next day, the district court issued an order denying SK hynix’s transfer request. The district court’s order also moved up the trial date from December 6, 2021, to July 6, 2021, and the Markman hearing from March 19, 2021, to March 1, 2021. SK hynix immediately notified the Federal Circuit of the denial and its intention to file a new mandamus petition to compel transfer. In the interim, SK hynix requested that the Federal Circuit extend the stay of the district court proceedings until briefing [...]

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2020 IP Law Year in Review: Patents

by Amol Parikh and Cecilia Choy, Ph.D. | Jan 28, 2021 | Patents

Executive Summary

In 2020, the US Supreme Court and Court of Appeals for the Federal Circuit continued to refine key aspects of intellectual property law on issues that will have an impact on litigation, patent prosecution and business strategy. This Special Report discusses some of the most important decisions.

The Federal Circuit issued several panel decisions clarifying the bounds of patent-eligible subject matter in the area of life sciences and computer technology. In the life sciences space, the court found several patents satisfied the conditions for patent eligibility. For example, the Federal Circuit found patent-eligible claims directed to preparing a fraction of cell-free DNA enriched in fetal DNA, claims directed to a method of operating a flow cytometry apparatus with a number of detectors to analyze at least two populations of particles in the same sample to be patent eligible, and claims directed to a method of treating type 2 diabetes mellitus using a DPP-IV inhibitor. In the area of computer technology, the court clarified that claims directed to an improvement to computer networks were patent eligible, but that claims directed to applying longstanding commercial practices to generic computer components remain ineligible. Given the uncertainty of patent eligibility law, questions surrounding life sciences and computer-related technology will continue to be raised in cases.

The Supreme Court issued one decision in 2020, in which it found that the Patent Trial and Appeal Board’s application of the time bar for filing a petition for inter partes review (IPR) is not appealable. The Federal Circuit issued two en banc decisions, including one decision confirming discussing the use of the phrase “consisting essentially of” in patent claims and patent eligibility of mechanical inventions.

Following on the heels of the Supreme Court’s 2017 TC Heartland v. Kraft Foods decision addressing patent venue, the Federal Circuit addressed patent venue in Hatch-Waxman litigation. The court explained that for the purposes of determining venue, infringement occurs only in judicial districts where actions related to the submission of an abbreviated new drug application (ANDA) occur, and not in all locations where future distribution of the generic products specified in the ANDA is contemplated. This ruling may have far-reaching consequences, including the ability for ANDA defendants to effectively control venue for litigation.

Patents

2021 Outlook

The Supreme Court is set to hear at least two patent cases and one copyright case this term. In The United States of America v. Arthrex, Inc., the Court will consider whether PTAB judges are unconstitutionally appointed and the other addressing whether assignor estoppel and in Minerva Surgical, Inc. v. Hologic, Inc., et al., the Court will consider whether the doctrine of assignor estoppel bars an assignor from asserting invalidity of an assigned patent in district court. [...]

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2020 IP Law Year in Review: European Issues

by Dr. Henrik Holzapfel, Laura Morelli and Charles de Raignac | Jan 26, 2021 | Copyrights, EU Update, Patents, Trademarks

Executive Summary

From a German perspective, 2020 saw highly interesting developments that may well have an impact even beyond the borders of Germany. For example, the Federal Court of Justice (Bundesgerichtshof) in Sisvel v. Haier handed down a landmark decision on fair, reasonable and non-discriminatory (FRAND) law. This decision has already affected many FRAND cases tried before lower instance courts. Generally speaking, the FRAND law judgments issued in Germany in 2020 may have more upsides for standard-essential patent (SEP) holders than for implementers of standardised technologies.

A successful constitutional complaint against the German act to ratify the Unified Patent Court (UPC) Agreement delivered a serious blow to the attempt to establish the UPC. However, German Federal Parliament and Federal Council managed, just before the end of 2020, to pass another UPC ratification act, thereby rectifying the mistake that led to the success of the constitutional complaint. The fate of the UPC project remains somewhat unclear, however, in light of newly filed constitutional complaints.

Finally, 2020 saw the United Kingdom officially withdraw from the European Union on 1 February and become a third-party country after a transitional period that ended on 31 December. This event has multiple consequences for EU intellectual property rights, particularly EU trademarks, depending on whether they were filed or registered as of 1 January 2021.

European Issues

2021 Outlook

Even though there were major developments in Germany regarding FRAND law and the UPC in 2020, these topics are far from being finally settled.

After the Federal Court of Justice’s Sisvel v. Haier decision led to relatively SEP-holder-friendly decisions by the Munich I District Court and the Mannheim District Court, the Düsseldorf District Court referred several FRAND-related questions to the CJEU in November 2020. The expected CJEU decision has the potential to shape the future of FRAND law not just in Germany, but in the whole European Union.

It will be interesting to follow the further development of the UPC project in the light of new constitutional complaints filed against Germany’s new act to ratify the UPC Agreement. These complaints may put another hold on the UPC undertaking. In any event, Germany is not expected to deposit its instrument of ratification very soon because the UPC still needs time to set up its infrastructure, including the appointment of judges.

The question of whether competitors and consumer associations can issue warning letters for violations of the General Data Protection Regulation (GDPR) continued to occupy the courts in 2020, and likely will do so in 2021 as well. According to a decision of the Stuttgart Court of Appeal dated 27 February 2020 (2 U 257/19), competition associations can issue warning letters for violations of the GDPR. The Berlin Court of Appeal previously affirmed this on 20 December 2019 (5 U 9/18) for consumer associations in the [...]

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CJEU Referral on Preliminary Injunctions by the Munich I District Court

by Dr. Henrik Holzapfel | Jan 21, 2021 | Patents

The 21st Civil Chamber of the Munich I District Court has referred a question on the availability of preliminary injunctions against patent infringements to the Court of Justice of the European Union (CJEU) in Luxembourg (Munich I District Court docket no. 21 O 16782/20, decision of 19 January 2021).

Key takeaways

The Munich I District Court has referred a question to the CJEU on whether the current standard for granting preliminary injunctions in patent litigation should be lowered.
The Munich judges indicate that the current standard imposes an undue burden on patentees, especially for newly issued patents.

IN DEPTH

Background

Granting a preliminary injunction requires a sufficient likelihood that the asserted patent is valid. Under current German appellate case law however, it is usually not sufficient to meet that standard by simply showing that the asserted patent has been granted by a respective patent office. Rather, with certain exceptions only, it is required that validity has been confirmed in inter partes invalidity proceedings (i.e., in opposition proceedings before the European Patent Office or the German Patent and Trademark Office, or in nullity proceedings before the Federal Patent Court). In the opinion of the Munich I District Court, this standard may impose an undue burden on patentees in view of the European Directive 2004/48/EC on the enforcement of intellectual property rights. The Munich judges reason that first, it would be difficult to enforce newly granted patents. Second, a patentee has little influence on whether validity of his patent will be challenged by third parties.

At the same time, and as mentioned by the Munich I District Court, it is widely accepted that there are exceptions that apply to the basic rule that that validity should first be confirmed in inter partes invalidity proceedings. For example in the landmark “Olanzapine” case, the Düsseldorf Appeal Court issued a preliminary injunction based on a patent that had been invalidated in first instance nullity proceedings, while an appeal in the invalidity proceedings was pending. Therefore, while the relevant patent had not survived first instance invalidity proceedings, a preliminary injunction was granted.

The question referred

The Munich I District Court referred the following question to the CJEU:

Is it in line with Article 9(1) of Directive 2004/48/EC for the Higher Regional Courts having jurisdiction at final instance in proceedings for interim relief to refuse in principle to grant interim measures for infringement of patents if the patent in dispute has not survived opposition or nullity proceedings at first instance?

Practice Note:

It will be interesting to follow the further development in connection with this referral, as the implications of the CJEU decision are likely to be far-reaching. The Munich referral may lead to new enforcement opportunities and strategies for patentees. At the same time, the Munich referral is in tension with current reform of German patent law which, if enacted, will emphasize a hurdle for injunctions, namely that injunctions must not be disproportionate.

Jetting along the Thin Line between Appellate Standing and Admitting Infringement

by Thomas DaMario | Jan 14, 2021 | Patents

The US Court of Appeals for the Federal Circuit found that an inter partes review (IPR) petitioner that had not been accused of infringement had standing to appeal a final decision in an IPR because the petitioner alleged facts establishing that there was a substantial risk of infringement of the challenged claims. General Elec. Co. v. Raytheon Techs. Corp., Case No. 19-1319 (Fed. Cir. Dec. 23, 2020) (Hughes, J.)

Raytheon owns a patent directed to a configuration for mounting a turbofan gas turbine engine to an aircraft pylon. Turbofan engines rely on four main component sections—the fan, compressor, combustor and turbine—to generate thrust from the continuous ignition of a mixture of fuel and pressurized air. The compressor and turbine sections are further divided into high-pressure and low-pressure segments. Each of these segments consists of stages, which include a matched set of rotating blades and stationary airfoils. The patent claims recite a “first” spool, which the parties equate with a low-pressure spool, turbine and compressor, and a “second” spool, consisting of the high-pressure spool, turbine and compressor. The claimed “second” spool includes “at least two stages.”

General Electric (GE) competes with Raytheon in the commercial aviation engine market and petitioned for IPR, challenging several claims based on two prior art references, Wendus and Moxon. Wendus discloses all elements recited in the challenged claims, except that it teaches a single-stage high-pressure turbine instead of the claimed “at least two-stage” high-pressure turbine. Moxon states that to improve fuel efficiency, “a move to one instead of two HP turbine stages is thought unlikely.” The Patent Trial and Appeal Board found that all elements recited in the challenged claims were found in the prior art but found that the claims were not proven to be non-obvious, in part because Wendus expressly considered at least some of the one-stage versus two-stage tradeoffs and specifically chose the one-stage option. This express consideration meant that Wendus taught away from combination with Moxon, the Board reasoned. GE appealed.

Before reaching the merits of the appeal, Raytheon moved to dismiss the appeal for lack of standing, arguing that it had never sued or threatened to sue GE for infringing the patent. Accordingly, the standing dispute centered on whether GE had sufficiently alleged an injury in fact. The Federal Circuit explained that “when an appellant relies on potential infringement liability . . . it must establish that it has concrete plans for future activity that creates a substantial risk of future infringement or would likely cause the patentee to assert a claim of infringement.” In the context of an appeal of an IPR proceeding, “it is generally sufficient for the appellant to show that it has engaged in, is engaging in, or will likely engage in activity that would give rise to a possible infringement suit.” GE presented evidence that it spent $10 to $12 million in 2019 developing a geared turbofan architecture and design and that it offered its geared turbofan design to Airbus in response to a request for [...]

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Revenge of the Grammar Nerds: Grammatical Canons Overturn $8.6 Million Jury Infringement Verdict

by Christopher M. Bruno | Jan 14, 2021 | Patents

Addressing whether the phrase “a plurality of” should apply to each element in a series, the US Court of Appeals for the Federal Circuit entered judgment of non-infringement, finding that the district court’s claim construction that did not require a plurality of each recited component was at odds with the claim language based on the application of grammatical rules. SIMO Holdings, Inc. v. Hong Kong uCloudlink Network Technology Limited, Case No. 19-2411 (Fed. Cir. Jan. 5, 2021) (Taranto, J.)

SIMO sued uCloudlink for patent infringement based on sales of certain GlocalMe WiFi hotspot devices and a wireless phone model. Generally, these hotspots and patented technology seek to reduce costs for calls and internet access for people traveling internationally.

The sole patent claim at issue covered an apparatus that performed certain communications protocol data transfer and authentication functions that enabled an international traveler to take advantage of a non-subscribed carrier without incurring roaming charges. At issue was the interpretation of that claim language, specifically whether the preamble, which recited a series of technological components (e.g., memory, processors, programs and, importantly here, “non-local calls database”), was a limiting part of the claim, and, if so, whether the language that recited “a plurality of” these components meant that the claimed invention must have a plurality of each of these components, or just more than one of all of them taken together. This was a determining factor for infringement, as it was essentially undisputed that the uCloudlink devices did not have one (let alone multiple) non-local calls databases. The district court concluded that the preamble language was limiting but, parsing the grammar involved and noting that specification “states that the non-local calls database is optional,” concluded that a non-local calls database was not a necessary component, and that summary judgment of infringement was warranted. UCloudlink appealed.

The Federal Circuit agreed that the preamble was limiting, but disagreed that a structure not having a recited element could infringe. The claim in issue recited “[A] wireless communication client or extension unit comprising . . .” followed by a list of components including the non-local call database. Notwithstanding that the database was found in the preamble, the Court concluded that it was limiting because it followed the term “comprising” and provided the necessary structure for the invention, which otherwise would have had no limiting description of the physical components of the apparatus. Moreover, the Court noted that subsequent claim language, which recited “the wireless communication client” and “the extension unit,” referred to those items identified in the preamble after “comprising.”

The Federal Circuit relied on many grammatical canons, its own precedent, various Scalia & Garner textualist interpretation books and the law-school writing-class favorite, Strunk & White. Applying these sources together, the Court reiterated that nouns in series are generally each treated as modified by a phrase that precedes the series (here, “a plurality of”), and that such a rule is particularly forceful when the series ends in an “and” rather than an “or.” And, with no article [...]

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Patent Owner’s Disavowal of Appeal from District Court’s Noninfringement Judgment Moots IPR Appeal

by Sarah P. Hogarth | Jan 14, 2021 | Patents

Addressing the standard for mootness in inter partes review (IPR) proceedings following a district court noninfringement judgment, the US Court of Appeals for the Federal Circuit held that a petitioner’s IPR appeal was moot after the patent owner decided not to appeal the final judgment of noninfringement. ABS Global, Inc. v. Cytonome/ST, LLC, Case No. 19-2051 (Fed. Cir., Jan. 6, 2021) (Stoll, J.) (Prost, C.J., dissenting in part).

In June 2017, Cytonome/ST filed a complaint against ABS asserting infringement of six patents, including the patent of interest in this case. ABS filed a petition for IPR of all claims of the patent. In April 2019, the Patent Trial and Appeal Board (PTAB, the Board) issued its final written decision invalidating certain claims of the patent. Two weeks later, the district court granted ABS partial summary judgment, holding that the accused products did not infringe any of the asserted patent’s claims. In June 2019, ABS appealed the PTAB’s final written decision. In a briefing before the Federal Circuit, Cytonome/ST’s counsel filed an affidavit stating that Cytonome/ST “has elected not to pursue an appeal of the district court’s finding of non-infringement as to the patent and hereby disclaims such an appeal.” In June 2020, the district court entered final judgment, including as to non-infringement of the patent.

The Federal Circuit dismissed ABS’ appeal of the PTAB’s final written decision on the ground that the appeal was moot in view of the district court’s non-infringement judgment. The Court characterized the question as one under the voluntary-cessation doctrine. In the context of intellectual property infringement cases, the voluntary-cessation doctrine requires the property owner claiming mootness to prove that the “allegedly wrongful behavior could not reasonably be expected to recur,” i.e., that it will not assert the intellectual property right against the same accused products again. If it does, the burden shifts to the accused infringer to show that it “engages in or has sufficiently concrete plans to engage in activities” that would not be covered by the property owner’s non-assertion decision.

Applying the doctrine, the Federal Circuit concluded that Cytonome/ST could not reasonably be expected to assert infringement of the patent against ABS because ABS had already secured a district court judgment that the accused products do not infringe and Cytonome/ST disclaimed any appeal of the non-infringement judgment. In effect, ABS was insulated from liability for infringement, including for future infringement for products that are “essentially the same” as ABS’ currently accused products pursuant to the Kessler doctrine. Further, the Court found that ABS had not demonstrated it could reasonably expect Cytonome/ST to sue it for infringement of the patent in the future as ABS had not shown it had current or concrete future plans to engage in activities not covered by Cytonome/ST’s disavowal: “Cytonome’s disavowal of its right to appeal the summary judgment of noninfringement ‘estops Cytonome from asserting liability against ABS for infringement of the…patent claims in connection with the accused products, thereby allowing ABS to make, use, and sell those products [...]

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Supreme Court to Consider Doctrine of Assignor Estoppel in Patent Cases

by Amol Parikh | Jan 14, 2021 | Cert Alert, Patents

The Supreme Court of the United States agreed to review assignor estoppel in patent cases. Minerva Surgical, Inc. v. Hologic, Inc., et al., Case No. 20-440 (Supr. Ct. Jan. 8, 2021) (certiorari granted). The question presented is:

Whether a defendant in a patent infringement action who assigned the patent, or is in privity with an assignor of the patent, may have a defense of invalidity heard on the merits.

Csaba Truckai is the inventor of two patents relating to endometrial ablation that were ultimately acquired by Hologic. Truckai later founded Minerva and developed a system that competed with Hologic’s system. The district court ruled that Minerva could not challenge the validity of the patents because Truckai was barred by assignor estoppel from attacking his own patents. A jury found that Minerva infringed both patents and awarded Hologic more than $4.7 million. On appeal, the US Court of Appeals for the Federal Circuit affirmed, confirming that assignor estoppel bars an assignor from asserting invalidity of an assigned patent in district court, and “declined Minerva’s invitation to ‘abandon the doctrine’ of assignor estoppel entirely.”

State University Challenges Board on Sovereign Immunity in Inter Partes Review

by Paul Devinsky | Jan 14, 2021 | Patents

The US Court of Appeals for the Federal Circuit reiterated that “[s]overeign immunity does not apply to IPR proceedings when the patent owner is a state.” Board of Regents of the University of Texas System v. Baylor College of Medicine, Case No. 20-1469 (Fed. Cir. Dec. 10, 2020) (per curiam).

Baylor College of Medicine petitioned for inter partes review (IPR) of two patents owned by the Board of Regents of the University of Texas System (UT). UT moved to dismiss the petitions on state sovereign immunity grounds. The Patent Trial and Appeal Board denied the motion, citing Regents of the University of Minnesota v. LSI Corp. (IP Update, Vol. 22, No. 7).

UT appealed, arguing that University of Minnesota was wrongly decided, but admitted that the panel was bound by it. Predictably, the panel affirmed the Board.

Practice Note: UT’s strategy implies that it intends to use its case as a vehicle to seek en banc (and possibly Supreme Court) review of the University of Minnesota decision.

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