Patent Office Trials Blog
    • 7/8/2014
    • 6/19/2014
      On June 19, 2014, in a tidy 17-page decision, Justice Thomas wrote for a unanimous Supreme Court in Alice Corporation v. CLS Bank that “claims [for exchanging obligations] at issue are drawn to the abstract idea of intermediated settlement, and that merely requiring generic computer implementation fails to transform that abstract idea into a patent-eligible invention.” Slip opinion at p. 1. Accordingly, the Supreme Court affirmed the Federal Circuit's en banc decision.

      The Supreme Court began with the applicable statute, Section 101 of the Patent Act, and cited the principle that “Laws of nature, natural phenomena, and abstract ideas are not patentable.” Id. at 5. “[I]n applying the §101 exception, we must distinguish between patents that claim the ‘building blocks’ of human ingenuity and those that integrate the building blocks into something more . . . thereby ‘transforming’ them into a patent-eligible invention.” Id. at 6.

      In its discussion of applicable precedent, the Court relied heavily on the Bilski and Mayo cases: “We must first determine whether the claims at issue are directed to a patent-ineligible concept. We conclude that they are: These claims are drawn to the abstract idea of intermediated settlement.” Id. at 7. The Court compared the claims in question to those in Bilski, in which “the claims described ‘the basic concept of hedging, or protecting against risk.’” Id. at 8. Then: “It follows from our prior cases, and Bilski in particular, that the claims at issue here are directed to an abstract idea.” Id. at 9.

      The Court continued as follows: “We turn to the second step in Mayo’s framework. We conclude that the method claims, which merely required generic computer implementation, fail to transform that abstract idea into a patent-eligible invention.” Id. at 10. “Mayo itself is instructive. . . . methods for determining metabolite levels were already ‘well known in the art,’ and the process at issue amounted to ‘nothing significantly more than an instruction to doctors to apply the applicable laws when treating their patients. . . . Simply appending conventional steps, specified at a high level of generality, was not ‘enough’ to supply an ‘inventive concept’” [emphasis in original]. Id. at 11.

      The Court also cited Benson and Flook, and contrasted those cases with Diehr: “simply implementing a mathematical principle on a physical machine, namely a computer, [i]s not a patentable application of that principle. . .”. Id. at 12. “Flook is to the same effect. . . . the prohibition against patenting abstract ideas cannot be circumvented by attempting to limit the use of [the idea] to a particular technological environment.” Id. In contrast, "[t]he invention in Diehr used a ‘thermocouple’ to [implement an otherwise abstract idea] – something ‘the industry had not been able to obtain. . . . These additional steps . . . ‘transformed’ the process into an inventive application of the formula.” Id. at 12-13.

      The Court then alluded to “the ubiquity of computers” (id. at 13) with a citation from the Lourie concurrence in the en banc Federal Circuit decision in setting the stage for its analysis of the case at bar: “[T]the relevant question is whether the claims here do more than simply instruct the practitioner to implement the abstract idea of intermediated settlement on a generic computer. They do not.” Id. at 14.

      The Court set forth its main rationale for the holding as follows: “Taking the claim elements separately, the function performed by the computer at each step of the process is ‘[p]urely conventional’ . . . . The method claims do not, for example, purport to improve the functioning of the computer itself . . . Nor do they effect an improvement in any other technology or technical field. . . . Instead, the claims at issue amount to ‘nothing significantly more’ than an instruction to apply the abstract idea of intermediated settlement using some unspecified, generic computer. . . . Under our precedents, that is not ‘enough’ to transform an abstract idea into a patent-eligible invention.” Id. at 15-16. Finally, the Court addressed the apparatus claims, stating that “the system claims are no different from the method claims in substance.” Id. at 16.

      In a brief concurrence by Justice Sotomayor (joined by Justices Ginsburg and Breyer), a general statement regarding “business method” patents is noteworthy: “I adhere to the view that any ‘claim that merely describes a method of doing business does not qualify as a ‘process’ under §101.’” Concurrence, slip op. at 1.

      Notably, the Supreme Court opinion tracks Judge Lourie’s concurrence from the decision below very closely, citing Lourie’s concurring opinion repeatedly. The Court relies heavily on the notion of adding “enough” to the abstract idea to “transform” the claim into one that is patent-eligible – mere computer implementation is not “enough,” but the use of an apparatus such as thermocouple in a manner not previously obtainable by industry is “enough.” Other specific guidelines for what constitutes “enough” include an improvement to functioning of computer itself, and/or an improvement in some other technology or technical field.

      In view of the parallels between Justice Thomas’s opinion and Judge Lourie’s concurrence, we believe that Judge Lourie’s framework presently provides the best set of guidelines for patent eligible subject matter, regardless of whether a claim is designated as a "business method," "software invention" or the statutory class of invention (process or system). In this aspect, we are reminded that Judge Lourie participated in the Ultramercial case (a three-judge panel, Judge Rader wrote the main opinion, Judge Lourie wrote a separate concurrence), in which the claims at bar were held to be patent-eligible, despite the district court holding that the claims were directed to an abstract idea.

      In Ultramercial, the Federal Circuit held that the “claim, as a whole, includes meaningful limitations restricting it to an application, rather than merely an abstract idea.” Claim 1 of the patent-in-suit included a recitation of eleven explicit “step[s]” which the Court characterized as “requir[ing] intricate and complex computer programming.” In the concurrence, Judge Lourie stated that “[t]he additional claim limitations reciting how that [otherwise abstract] idea is implemented ‘narrow, confine, or otherwise tie down the claim so that, in practical terms, it does not cover the full abstract idea itself’” and that “the added limitations in these claims represent significantly more than the underlying abstract idea of using advertising as an exchange or currency.”

      After the Supreme Court's decision in CLS Bank, practitioners and applicants should look to Judge Lourie’s analysis in Ultramercial as indicating that by providing “additional claim limitations [that] represent significantly more than the underlying abstract idea,” one can be reasonably sure that the claim will be deemed patent-eligible. In this aspect, as usual, the particular details of each claim are the key to the analysis, and a patent practitioner should therefore endeavor to recite claim limitations which he/she can “hang your hat on” with respect to what represents “significantly more” – and the reasons why they represent “significantly more” – than the underlying abstract idea.
    • 6/18/2014
      On June 18, 2014, The Trademark Trial and Appeal Board, the Administrative Court of the US PTO for trademark cases, granted a petition to cancel six trademark registrations which consist of, in whole or in part, the term REDSKINS for professional football related services. The petition was brought by five Native Americans on the ground that the term REDSKINS was disparaging to Native Americans and, therefore, unregistrable under 15 USC 1052(a).

      The Board, in a 2—1 decision, concluded that, based on the record before it, the term REDSKINS in the registered marks, when used in connection with services related to professional football, refers to Native Americans and that a substantial composite of Native Americans found the term to be disparaging to them, during the relevant time frame of 1967—1990, when the registrations involved in the cancellation proceeding issued. Based on these conclusions, the Board ordered that the six REDSKINS registrations be cancelled.

      The Board’s decision made it clear that the decision to cancel the REDSKINS registrations concerns only the statutory right to registration under the federal Trademark Act and that the Board has no authority to issue rulings concerning the right to “use” the trademarks.

      An appeal of the decision is likely, which appeal will be made either to the US Court of Appeals for the Federal Circuit or by the filing of a civil action in a United States District Court.
    • 6/6/2014

      Sughrue is proud to announce that Diallo Crenshaw, partner in the electrical/mechanical group of the DC office, was selected to receive the "Trailblazers Under 40 Award" by the National Bar Association.  The Trailblazers Under 40 Awards honors legal trailblazers who have achieved prominence and distinction in their fields of endeavor — be it the practice of law, academia, business, civic and charitable affairs, the judiciary, or politics — and who have demonstrated a strong commitment to advancing the goals and mission of the National Bar Association.

      Mr. Crenshaw will receive his torch at the Trailblazers Under 40 Gala on Saturday, July 26, 2014 at the Atlanta Marriott Marquis.  Diallo will be joined by past recipients of the award and other esteemed members of the National Bar Association.   

      To see the National Bar Association's official press release, please click here.

    More News
    • July 10, 2014
      Thomas Jefferson, Benjamin Franklin, and the multitude of men and women who helped establish the United States were visionaries in many ways. One of the most important of which was to provide Congress with the power “to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”1 While the drafters of the Constitution likely understood that this provision, a mere 27 words, would lead to many patents, they likely did not realize that their actions would help foster the incredible inventions and discoveries we have today. Additionally, while the drafters of the Constitution gave Congress the power to regulate this patent system as Congress saw fit, the Founding Fathers did not intend for certain patent holders to have their rights stifled by future legislative, regulatory, or judicial proceedings. However, in the wake of the Federal Circuit’s recent decisions in Classen Immunotherapies, Inc. v. Biogen IDEC2 and Momenta Pharmaceuticals, Inc. v. Amphastar Pharmaceuticals,3 the right of patent owners, having patents directed to drugs, medical devices, and other products that require regulatory approval under a Federal law, to pursue infringers has been significantly limited. This could result in a diminished economic value of such patents.
    • 6/16/2014
      Trademarks are an extremely valuable asset, and often your company's most enduring asset. Trademarks serve as an information shortcut for consumers, helping to distinguish your products and services from those of competitors. Via a single brand, trademarks effectively communicate your company's reputation, products and services, as well as the consumers' lifestyle and desires.
    • 6/5/2014
      In the field of computer and electronics, the structure of the device, the materials used, or the processes at work in an electronic device are not readily apparent to a patent holder seeking to enforce a patent against potentially infringing electronic devices. As electronic devices shrink and become more complex, it is becoming more difficult to fully ascertain all of the structures, materials and processes at work in such devices. The difficulty of analyzing elements of electronic devices to determine whether the electronic devices are infringing a patent raises questions as to what is the level of reasonable inquiry required prior to filing a lawsuit.
    • 5/31/2014
      The doctrines of "first sale" in copyright and "exhaustion" in patents stem from a common policy concern -- to permit the free flow of trade. Once a rights holder sells an article protected by the IP, the rights holder cannot later assert infringement against a re-sale of that same article. In Kirtsaeng v. John Wiley & Sons,1 the U.S. Supreme Court recently decided that the foreign sale of the copyrighted article will trigger the "first sale" doctrine, thereby allowing import of that article into the U.S. However, the Supreme Court has declined to preside over the same issue for patents.2 Therefore, a U.S. patent is only exhausted by an authorized U.S. sale, despite an authorized sale abroad.3 Unlike in copyright, if the patented article is sold legally through a foreign sales channel, the U.S. patent holder may still preclude that product from entering into the U.S. market. While patent holders enjoy this additional barrier to entry of imported goods, there are still additional considerations for further protection against parallel imports. For instance, a common business model is to sell an expensive durable good to be used with a non-durable consumable part. These can range from common items such as printers and their ink cartridges to more sophisticated products such as medical imaging systems and their re-recordable media. Rights holders can prevent sale of the durable good from exhausting their rights in the consumable part through patent strategies and use restrictions. This is especially important where the consumable part can be originated from countries with low cost manufacturing or remanufacturing.
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