Patent Venue Mandamus Has Its Limits

Having just addressed several, important patent venue issues on mandamus in a trilogy of cases (see our prior posts here, here, and here), the Federal Circuit recently issued a terse opinion denying mandamus on yet another venue-related petition, stating that mandamus was unwarranted. Continue Reading

China Reforms its IP Administrative System with the Creation of a New Super Administration

As part of larger institutional reorganization schemes, the Chinese government has recently issued a draft statute for the reform of the State Intellectual Property Office (SIPO). SIPO, until now an agency subordinated to the executive branch (i.e. the State Council), will be organized under a newly created super agency in charge of IP and product quality and safety. Among the goals of the reform are administrative simplification and increased efficiency in handling IP related matters, as well as the improved protection of the intellectual property rights of foreign entities and individuals in China. Continue Reading

New Jurisprudence Rendered By Spanish Courts Facilitates Closing Of Websites

Recent jurisprudence rendered by Spanish Courts establishes that in the case of copyright infringement over the internet, it is not necessary to sue the infringer, but rather the IT intermediaries that host the website.

The Court of Appeal in Barcelona has now dismissed an appeal filed by several IT companies against the first instance Judgment that established the above-mentioned doctrine.  The claimant had sued several IT companies requesting that the defendants must prevent access to a website that was allegedly infringing certain copyrights.  The petition was made based on the Spanish Copyright Act, which establishes the ability to request such action against the intermediaries, not only as an injunction but also as a petition on the merits.

The availability of this action, however, presents a potentially problematic situation that was argued by the IT intermediaries as an objection against the claim. The problem is that if the infringer is not sued, there would be no previous declaration of infringement and, consequently, the intermediaries could not be requested to prevent access. Here, the claimant previously requested the Spanish regulator to order the infringer to stop infringing the claimant’s copyright.  Although initially the infringer stopped the infringement, it eventually restarted it. The claimant also produced an expert report that showed that the infringer facilitated links that allow free downloading of music.  The Court of Appeal decided that it is possible to sue the intermediaries without the need to sue the infringer and without the need to obtain a previous declaration of infringement, so long as evidence of the infringement is provided.

Finally, another problematic issue is that this action might determine that non-infringing content could also be prohibited. However, if the main use of the website infringes the copyright, the decision to prevent access is not disproportionate.

Failure To Name Joint Inventors May Bar Patentability

Following a rejection by the United States Patent and Trademark Office (“USPTO”) under section 102(f) for a rehabilitative dog harness, the Federal Circuit recently affirmed the rejection because the applicant “did not himself solely invent the subject matter sought to be patented.”  In re VerHoef, No. 2017-1976 (Fed. Cir. May 3, 2018).

Jeff VerHoef built a prototype harness to remediate walking difficulties that his dog developed post-surgery.  VerHoef recognized that the harness would work better if it were connected to the dog’s toes, and discussed the matter with his veterinarian, Dr. Alycia Lamb.  During their discussion, Dr. Lamb suggested that VerHoef should consider using a figure eight strap that fit around the dog’s toes and wrapped around the lower part of the leg.  VerHoef implemented the figure eight idea, and, after further adjustments, had a working device that reduced the dog’s walking difficulties.  VerHoef filed a patent application naming both him and Dr. Lamb as co-inventors, with a single claim that included Dr. Lamb’s figure eight strap suggestion.  After a falling out, VerHoef’s attorney abandoned the joint application, and each inventor then filed their own separate applications reciting the same independent claim contained in the abandoned joint application.

After finding the parallel Lamb application in his prior art search, the examiner rejected the claims in VerHoef’s new patent application under section 102(f), finding that VerHoef did not solely invent the claimed subject matter in light of the parallel Lamb application.  The Patent Trial and Appeal Board (“PTAB”) affirmed the examiner’s rejection, and VerHoef appealed. Continue Reading

USITC Finalizes Amendments To Procedural Rules Governing Section 337 Investigations

The U.S. International Trade Commission (ITC) has published in the Federal Register final revisions to its rules of practice and procedure governing Section 337 investigations, the investigations that the ITC conducts under 19 U.S.C. § 1337 based on private party complaints against imported articles that allegedly violate U.S. intellectual property rights.  This completes a process begun in 2015 when the ITC first initiated a proposed rulemaking for changes to its rules.  The rules will go into effect for investigations instituted after June 7, 2018.

Among the changes highlighted by the ITC as most significant are:

  • Requiring the ITC’s notice of investigation to explicitly identify the accused products subject to investigation.
  • Clarifying that the ITC may institute multiple investigations based on a single complaint.
  • Permitting an Administrative Law Judge (ALJ) to sever an investigation on motion or sua sponte to allow efficient adjudication.
  • Formalizing the ITC’s pilot program for early disposition of investigations in which the ITC (not the assigned ALJ) identifies, at institution, a potentially investigation-dispositive issue that can be resolved in an expedited (100-day) proceeding.

Takeaways:

The requirement that the notice of investigation explicitly identify the accused products serves transparency, guides discovery, and frames the scope of relief if a violation is found.  The new rules on institution and severance both aim to give the ITC additional tools to manage its increasing docket.  The ITC’s pilot program for early disposition also is an important case management tool, and its use has appeared to gain some momentum in 2018 (see our prior post and newly-designated Inv. No. 337-TA-1109 (Notice)).  However, the early disposition of cases is more than a management tool:  it provides a substantive opportunity for resolution of a Section 337 investigation before proceeding with a costly hearing.  Although case-dispositive motions were permitted before the ITC’s pilot program came into existence, many perceived the ability to achieve an early ruling as more theoretical than real.  By formalizing the pilot program, the ITC now has an official process to point to that it can use to counter some of the recent criticisms of the Section 337 adjudicative process.

U.S. Corporate Defendants Incorporated In Multi-District States Reside Only In A Single District For Patent Venue Purposes

In the third important patent venue decision it has issued in the past week (In re: BigCommerce, No. 2018-122 (May 15, 2018)), the Federal Circuit has clarified the proper location for patent infringement suits against U.S. corporations whose state of incorporation is large enough to have multiple federal judicial districts.  According to the Court,

a domestic corporation incorporated in a state having multiple judicial districts ‘resides’ for purposes of the patent-specific venue statute, 28 U.S.C. § 1400(b), only in the single judicial district within that state where it maintains a principal place of business, or failing that, the judicial district in which its registered office is located[.]

The Court’s opinion answers a question left open by the Supreme Court’s landmark decision in TC Heartland, LLC v. Kraft Foods Grp. Brands, LLC, 137 S.Ct. 1517 (2017), which held that a U.S. corporate defendant resides in the state in which it is incorporated (see our prior post), but did not answer the question of where to sue in multi-district states.

The Court’s interpretation of the patent venue statute as restricting venue to a single judicial district was not unexpected (see our prior post), and pointed to “clear support in the statute’s language, history, purpose, and precedent.”  The Court’s opinion also, however, provides guidance on how to determine the proper district for patent venue that was not strictly required to resolve the case at hand. Continue Reading

Federal Circuit Rules That Plaintiff Bears Burden Of Proving Proper Patent Venue

In another important patent venue decision (In re: ZTE (USA) Inc., No. 2018-113 (May 14, 2018)), the Federal Circuit has determined that who bears the burden of establishing proper venue is a question of Federal Circuit law and that it is the plaintiff who bears that burden.  According to the Court, although the Federal Circuit itself has never ruled on where to place the burden in its 37-year history, its conclusion is supported by authority among the other circuit courts and by the venue statute’s “intentional narrowness” as “compared with the broad general venue provision.”  The Court therefore granted the defendant’s mandamus petition, vacated the district court’s order denying defendant’s motion to dismiss for improper venue, and instructed the district court to place the burden of proof on the plaintiff and to reconsider defendant’s motion, and specifically, whether the nature of the defendant’s relationship to a call center it had contracted with “warrant[s] [the] call center being deemed a regular and established place of business [of the defendant].”

Takeaway:  The Court’s decision plugs still another hole left open after the Supreme Court’s landmark patent venue opinion in TC Heartland LLC v. Kraft Foods Grp. Brands LLC , 137 S. Ct. 1514 (2017) and creates a not insignificant, new hurdle for patent plaintiffs.  Still more decisions are expected in this area from mandamus petitions that remain pending at the Federal Circuit (see our prior post).

Federal Circuit Finds Patent Venue Over Alien Corporations Is Proper In Any District

In an important patent venue decision (In re HTC Corporation, No. 2018-130 (May 9, 2018)), the Federal Circuit has denied the mandamus petition of a Taiwanese company challenging the District of Delaware’s finding that that court is a proper venue for patent infringement litigation over the company.  Relying on the Supreme Court’s decision in Brunette Machine Works, Ltd. v. Kokcum Industries, Inc., 405 U.S. 706 (1972), the unanimous panel reaffirmed that the rule that non-U.S. resident or “alien” defendants can be sued in any judicial district applies in patent cases.

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The USPTO Proposes to Interpret Claims in Post-Grant Proceedings in the Same Way as the Federal Courts, and to Consider Prior Claim Constructions by Courts

With IPRs here to stay, the USPTO is proposing to drop its BRI standard and interpret claims under the same standards as used by federal courts.  Specifically, the USPTO has proposed to change the standard for interpreting claims in inter partes review, post grant review, and covered business method patent proceedings conducted by the PTAB from the “broadest reasonable interpretation” or “BRI” to the “ordinary and customary meaning” standard applied by federal district courts, taking into consideration any prior claim construction determinations by the courts.

The proposal, available here, is open for comments through July 9, 2018.

The proposed change comes on the heels of the US Supreme Court’s April 24th decision in Oil States Energy Services, LLC v. Greene’s Energy Group, LLC et al., that inter partes review proceedings are a constitutional process for addressing a public right (albeit one that pertains to private rights).  See our prior post here.  The proposal is made despite – or perhaps in light of – the Supreme Court’s decision just two years ago, in Cuozzo Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2142 (2016), that the USPTO has authority to choose the standard it applies, and can use the traditional “broadest reasonable interpretation.” Continue Reading

Incorporation by Reference Is Not a Substitute for a Specific Priority Claim

Under 35 U.S.C. § 120, an application claiming benefit to the filing date of an earlier application must include a “specific reference” to the earlier filed application. In Droplets, Inc. v. E*TRADE Bank, No. 2016-2504, 2016-2602 (April 19, 2018), the Federal Circuit considered the use of incorporation by reference when asserting priority claims. The Federal Circuit’s decision highlights the inapplicability of incorporation by reference as a means of asserting priority and the need to maintain vigilance in reviewing the USPTO’s records of priority. Continue Reading

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