Per this story in Crain's Chicago Business, Illinois has joined the list of states that has created a state cause of action for patent trolling. The summary:
The bill by Sen. Daniel Biss, D-Evanston, specifically makes it a violation of civil law to demand a royalty payment from a company if the demander doesn't hold or represent the patent holder itself, or if the patent has been overturned in court or expired. It also will be illegal to use any written communication, including emails, to falsely accuse someone of a patent violation with the intent of forcing a settlement.
This raises a question - is an exclusive licensee a "patent holder?" You can't tell from the article, but if you look at the text of the statute (here), it doesn't say "patent holder." It says that the person asserting the patent must either be (or represent) "a person with the current right to license the patent [] or enforce the patent." So that's OK then. And now, since it's in Illinois, and there's a bridge (under which a troll might be hiding):
According to this article from the Richmond Times-Dispatch, the USPTO has recently completed a survey of the trademark register, and found that approximately half of all marks "contained false claims as to what goods or services were being sold using those trademarks." When a mark's owner certifies that the mark is being used on a range of products, they don't have to show actual use on all of the products listed, but only on one item. The USPTO takes your word for it with respect to the rest of the list. The new survey shows that, for about half of the marks checked, the owners were not using the mark on all of the listed products or services. Worse, about a third of trademark owners did not respond to the survey at all, resulting in cancellation of their marks.
Just picked this up last weekend - so far, it's the best novel I've ever read whose main character is an IP attorney that has extraterrestrials as clients. Pick it up in the Kindle version on Amazon for cheap. You'll be glad you did.
What's the going rate for a highly qualified technical expert - a testifying expert - in a patent litigation? What's the upper limit? Is there a rate that you wouldn't pay? Answer in comments below.
Rightscorp Inc. (website) is a company that describes itself as
dedicated to the vision that digital creative works should be protected economically so that the next generation of great music, movies, video games and software can be made and their creators can prosper.
Which is nice, I guess. Rightscorp says that it "monitors the global Peer‐to‐ Peer (P2P) file sharing networks to seek out and find illegally downloaded digital media." When it identifies someone making an unlicensed download, it arranges with the relevant ISP to send the customer a notice demanding royalty payments. So far, so good. It's what comes next that's interesting. According to TorrentFreak (I know, right?), Rightscorp is negotiating with major US ISPs, including Verizon and Comcast, to redirect all of the accused pirate's internet traffic to a page demanding royalty payments. Due process? Not so much.
Researchers at Harvard and the University of Texas have published the first analysis of the litigation behavior of NPEs (full text of study here). They also draw some correlations between NPE suits and the subsequent behavior of the defendants. It's a detailed analysis, that's going to take some time to go through, but from my quick skim through the article I can provide you with a short summary: trolls bad. More later.
We can rest easy. Last Thursday the Seventh Circuit issued an opinion (here) upholding the decision of the US District Court for the Northern District of Indiana. Appellee Fortres Grand Corp. sells computer security software under the mark "Clean Slate." They describe the software at their website:
Discards unwanted user changes at log off or reboot, No Partitioning Ever, Effortless Windows Updates Support, Seamless AV Updates, Easy Application Blocking, Enable-Disable-Configure with No Rebooting Ever, Super Flexible, Easy, Secure!
Sounds pretty good. Anyway, Fortres Grand sued Warner Brothers for trademark infringement. Now, you may have heard of Warner Brothers. Their main thing is movies, music, cartoons, stuff like that. Warner Brothers doesn't market computer security software. And that's the main problem that the district court, and the appellate court, identified with the suit. In The Dark Knight Rises, there's a MacGuffin in the form of a piece of software that will completely erase a person's past. The software is referred to in the movie as "clean slate" software. Get it? Unfortunately (?) for Fortres Grand, the use of the term "clean slate" in the movie doesn't constitute infringement of their mark, because there's no likelihood of confusion - potential customers of Fortres Grand are not likely to buy copies of Dark Knight Rises, thinking that they're getting computer security software. They might have grounds for complaining of disparagement, except that in the movie, the software actually works. In fact, it occurs to me that Warner Bros. may have a basis for charging Fortres Grand for product placement. Or maybe not.
Last week the Federal Circuit affirmed a decision of the US District Court for the Southern District of Florida, holding that US Patent 6,767,556, assigned to Apotex, is unenforceable due to inequitable conduct on the part of the inventor. In its decision the Federal Circuit enumerated the inventor's sins, to determine materiality and intent to deceive. In evaluating the "materiality" prong of the test, the court noted that "The ’556 patent’s specification, written by Dr. Sherman, omits important details regarding the prior art that were determined to have been known to him." (slip op at 13) OK, at this point I was thinking: wait a second - you're not required to discuss the prior art in your US patent application (unlike, say, in Europe, but that's for a different post). How is omitting known details about the prior art in your patent specification inequitable conduct? The answer is, it isn't - if you can resist the temptation to discuss the prior art in the first place. HOWEVER, once you start discussing the prior art, you'd better be extra-careful.
To be clear, we agree with Apotex that Dr. Sherman had no duty to disclose his own suspicions or beliefs regarding the prior art. There is nothing wrong with advocating, in good faith, a reasonable interpretation of the teachings of the prior art. The misconduct at issue, however, goes beyond failing to disclose a personal belief or alternative interpretations of the prior art; here, Dr. Sherman affirmatively and knowingly misrepresented material facts regarding the prior art.
(slip op at 14; cites omitted). The clear take-home lesson from this is that if you don't discuss the prior art in your specification, you don't have to worry about being accused later of selectively omitting details that are helpful to your case. And since citing prior art in the specification (perversely) doesn't "count" as disclosure (in the same way that citing the art in an IDS does count), why do it at all?
The team has appealed the TTAB decision to the US District Court for the Eastern District of Virginia. Original post with link to TTAB decision here. And now, the other shoe has dropped:
You can get your "Caucasians" t-shirt at the url listed above. Not surprisingly, they're back-ordered.
OK, this has nothing to do with IP, but I felt like I had to share. Here's a link to the songlist for the "Awesome Mix Vol. 1" from Guardians of the Galaxy. Enjoy!
A trio of Argentinian street artists (yes, street artists again) are suing director Terry Gilliam and the producers of the soon-to-be-released sci-fi film "Zero Theorem" for copyright infringement. The film which stars Christoph Waltz, Matt Damon, and Tilda Swinton, takes place in a dystopian future (what else?). I think they've got a decent case - but don't take my word for it: check out the complaint here. It's worth scrolling through - I've never seen a complaint with embedded graphics like this.
I noted in this post from back in May that the North Carolina House was taking up a patent troll bill similar to those already passed in other states, including Vermont. On August 6, Governor McCrory signed what can only be described as a "multi-purpose" bill (text here). The bill bears the heading
"AN ACT TO CREATE TRANSPARENCY IN CONTRACTS BETWEEN THE ATTORNEY GENERAL AND PRIVATE ATTORNEYS, TO PREVENT THE ABUSE OF PATENTS, TO ALLOW FOR SHAREHOLDER ASSENT TO EXCLUSIVE FORUM, AND TO LIMIT ASBESTOS-RELATED LIABILITIES FOR CERTAIN SUCCESSOR CORPORATIONS."
That part in the middle is the part that creates a cause of action for sending patent demand letters in bad faith. One interesting part: you can be a "target" of a patent troll under this bill if your customers have received patent demand letters, even if you haven't.
Vermont v. MPHJ Technology Investments is a case arising out of the Vermont state anti-trolling statute. As noted in previous posts, this is one of those laws that prohibits sending bad-faith patent demand letters.
In this instance, the accused troll, MPHJ, moved to remand the case to The US District Court for the District of Vermont. The District Court granted Vermont's motion to remand to state court for lack of subject matter jurisdiction.
Now this sounds like a no-brainer. How can you possibly evaluate whether a patent demand letter was sent in bad faith without investigating infringement and/or validity? So naturally, you'd expect the Federal Circuit to reverse, and tell the District court to stop messing around and do its job.
If so, you'd be wrong.
In an opinion authored by Judge Newman, the Federal Circuit notes that under 28 USC 1447(d), "An order remanding a case to the State court from whch it was removed is not reviewable on appeal or otherwise." So that, as they say, is that.
Guess I should have paid closer attention in my Fed Jur class in law school.
Somebody somewhere is pissed off, because patent examiners at the USPTO are apparently not putting in time sitting at their desks interfacing with their computers.
According to this story in today's Washington Post, the Office of the Inspector General conducted an investigation prompted by one or more whistleblowers who think that Examiner are "gaming" the work-at-home system.
Let's just remember a few things, shall we?
The work-at-home thing was necessitated because there isn't enough space at the USPTO for all the examiners to have someplace to sit.
Before the USPTO moved to its new campus, back when they were all crammed in to makeshift space in Crystal City, VA, there was PLENTY of gaming of the system that went on, notwithstanding the fact that the examiners were purportedly sitting at their government-provided desks in their supervisor-monitored offices. Anybody remember "mortgaging" files?
Does anybody really think that the solution to the patent "quality" problem is to have examiners sitting at their computers from 9-5 Monday through Friday?
But by all means, let's have the USPTO lease a couple thousand more offices in Alexandria, and chain the examiners to their desks. That'll ensure that the taxpayers applicants are getting their money's worth out of the examination process.
On Wednesday, a group of five* U.S. Senators sent this letter to the Secretary of Commerce. They're offering their advice on how to improve the examination process at the USPTO, to insure higher-quality patents.
My first reaction is to dismiss this out of hand. What do these guys (yes, they're all men) know about examining patents? I'm guessing, not much.
On the other hand, maybe what this needs is a fresh look from some outsiders. And they offer five clear recommendations.
1. The USPTO should continually review and asses the operational examiner management system and performance metrics in place to ensure that they incentivize quality over quantity. Examiner evaluation should particularly ensure that it does not improperly incentivize the approval of low-quality patents.
NOTE: This is exactly right. Make sure that examiners are only being rewarded for allowing good patents. It's just like this:
2. Examiners should be clearly directed on how to ensure application records are fully built-out so that resolution of any ambiguity in the initial examination process is documented. Application files should provide a clear history of clarified terms and original intent so that an approved patent cannot later be twisted to cover future inventions, and examiners should have clear guidance on the level of detail that should be provided as they document their communication with patent applicants during the examination process.
NOTE: There's nothing that's worse than patents being twisted to cover future inventions. Except, maybe, reading stuff written by people who evidently have no idea what they're talking about. For example, they're not saying here that you shouldn't be able to write a broad claim that dominates a later, narrowly-drafted patent claim, are they? Or are they? I wish there was some way to resolve this ambiguity.
3. The USPTO has taken additional steps to address functional claiming concerns. The effectiveness of these measures should be assessed to determine whether they are sufficient to address concerns that functional claiming provides a loophole from definite, precise claims and that nor all functional claims are held to the relevant standards.
NOTE: "Functional claiming concerns" apparently refers to the concerns some people have about claims that have functional limitations. I presume they're not talking about means + function limitations. It would be helpful here to have some clearer idea of exactly what they see as the problem.
4. As the USPTO continues to identify ways to improve patent quality and ensure claim clarity, it should expand the use of crowdsourcing and data analysis to identify types of patents and specific characteristics that are most likely to give rise to ambiguity and produce litigation risk and specifically target those areas for stronger measures.
NOTE: There's that "ambiguity" word again. The way these guys are obsessed with ambiguity, you'd almost think that they'd never been to law school. [I just checked - three of the five didn't go to law school, and Senator Begich didn't even graduate from college. So maybe that explains that].
5. Finally, the USPTO should ensure public access to information about patents and there histories, which is one of the agency's duties. In particular, continuing to expand the information publicly searchable on the USPTO's website is important.
NOTE: Mission accomplished!
*Jeff Merkley (D - Ore.); Mark Begich (D-Alaska); Martin Heinrich (D-N.M.), Tom Udall (D-N.M.); and Mark Warner (D-VA). BTW, the letter has space for eight signatures, but only five signed. Why would you leave those extra three lines on there? It just looks like three people backed out at the last minute.
If a monkey grabs my camera and takes a picture of himself, do I have any rights in the picture? Does the monkey? Does anyone? You can read about the controversy here. Basically, photographer David Slater was taking pictures of monkeys. He left his camera alone for a minute, and the monkeys grabbed it and started messing with it. The picture posted above was taken by the monkey shown in the picture (yes, it's a "selfie"). Slater is asserting copyright in the picture. Web denizens, including Wikimedia Foundation, disagree. This is such a simple problem. All Slater needs to do is give the monkey a banana. The monkey took the picture using Slater's equipment, for which the monkey was remunerated. Work for hire! Problem solved.
Per this Official Notice, effective immediately, visitors to the USPTO's Alexandria campus from the following states will not get past security by showing their driver's license (or other state-issued ID card):
Alaska
American Samoa
Arizona
Kentucky
Louisiana
Maine
Massachusetts
Minnesota
Montana
New York
Oklahoma
Washington
If you're from one of these states, you will need to show a Federally-issued ID, such as:
Passport
Passport card
DoD’s CAC
Federal agency HSPD-12 ID
Veterans ID
Military dependents ID
Trusted Traveler card – Global Entry, SENTRI, or NEXUS
An article published today in the New York Law Journal looks at decisions relating to the "idefiniteness" standard since the Supreme Court's decision last June in Nautlius v Biosig. (572 U.S. __, 2014). You'll recall that the Supreme Court chucked out the Federal Circuit's "insolubly ambiguous" standard in favor of a new rule: "that a patent's claims, viewed in light of the specification and prosecution history, inform those skilled in the art about the scope of the invention with reasonable certainty." Much clearer, right? Anyway, according to the article, a number of courts have applied the "new" standard since June, and most of the time, they're not having trouble figuring out what claims mean.
...In Hand Held Prods. v. Amazon.com, C.A. No. 12-768-RGA-MPT, 2014 BL 175317 (D. Del., June 24, 2014), Magistrate Judge Mary Pat Thynge found that the defendant in that case had failed to prove by clear and convincing evidence that certain terms, such as "bar-coded information" and "bar-code readable information," are indefinite. In reaching this conclusion, the court specifically noted in several instances that the defendant had provided "no expert testimony in support of its indefiniteness argument," and instead relied on attorney argument. In Endo Pharm. v. Watson Labs., Case No. 2:13-CV-192-JRG, 2014 BL 173773 (E.D. Tex., June 23, 2014), Judge Rodney Gilstrap rejected the contention that certain terms, such as "with increased penetration" and "reducing inflammation" which defendant considered to be "words of degree," were indefinite. In Augme Techs. v. Yahoo!, No. 2013-1121, 2014 BL 171920 (Fed. Cir., June 20, 2014), a panel of the Federal Circuit rejected a contention that the term "receiving, by an ingest server, the unique identifier to the digital content," was indefinite. Citing the standard in Nautilus, the court stated that this term "is clear on its face and unquestionably meets this standard." And in Purdue Pharm. Prods. v. Actavis Elizabeth, No. 12-5311 (JLL), 2014 BL 162761 (D.N.J., June 11, 2014), Judge Jose L. Linares disagreed with defendant's argument that the term "without residual sedative effects" was indefinite because the patent failed to identify which of several methods disclosed in the specification for determining whether a person taking zolpidem wakes up "without residual side effects" governs.
We'll have to wait to see what the Federal Circuit does with Nautilus on remand, but in the meantime, District Courts are not treating this like a directive from the Supreme Court to strike down claims as indefinite.
In her testimony before the House Committee on the Judiciary on Wednesday, Director Lee was asked by Congressman George Holding (R - NC) to comment on the Australian law that prohibits manufacturers of tobacco products from using their trademarks. Lee confessed that she was unfamiliar with the topic, and promised to check and get back to him with an answer. This seemed to satisfy the congressman. The issue wasn't familiar to me, either, but a quick internet search turned up lots of stories from three years ago about this, which I had heard about:
Since 2012, all cigarettes in Australia are required to be sold in packages that look like these. You'll notice the word "brand" on the bottom front of each box. These are mock-ups; on a real package of cigarettes the word "brand" would be replaced by, say, "Marlboro" or "Camel" or "Winston" in that same plain text on an olive-green background.
The aim of these packages is to deter smokers. And according to this story in the Financial Times apparently it's working. Which explains why the representative from North Carolina is particularly interested in this issue.
What makes it an IP issue is that the Australian government has taken the position that having a trademark doesn't grant you the right to use the mark; all it does is grant you the right to exclude others from using the mark. This concept, while familiar to most IP attorneys, is difficult for most laypeople (and some members of the U.S. Supreme Court) to grasp.
The Australian law is currently the subject of a dispute at the WTO, that was originally brought by Ukraine (!), although it has since been joined by a number of other countries, including the U.S., accusing Australia of being in violation of the TRIPS agreement. So this bears watching, particularly as there are reportedly other countries, including the U.K., Ireland, and New Zealand. And while it's confined to tobacco products now, this kind of regulation could theoretically be applied to any product or service that a government wants to discourage.
