The Federal Circuit’s recent en banc opinion in Williamson v. Citrix Online, LLC, 2015 U.S. App. LEXIS 10082, *2 (Fed. Cir. June 16, 2015) (Williamson II) may result in courts finding that more claims include “means-plus-function” claim elements, which could significantly affect the scope and validity of those claims. As a result of Williamson II, the Federal Circuit has weakened the “presumption” that claim elements lacking the term “means” fall outside the means-plus-function analysis. Continue Reading
On June 23, 2015, the Federal Circuit affirmed the finding of the U.S. District Court for the Northern District of California (“District Court”) dismissing the complaints in four related actions for infringement of U.S. Patent No. 7,707,505 (the ‘505 Patent) on the ground of patent ineligibility under 35 U.S.C. §101. See Internet Patents Corp. v. Gen. Auto. Ins. Servs., Inc., 29 F. Supp. 3d 1264 (N.D. Cal. 2013) (“Dist. Ct. Op.”). Continue Reading
This is the third in a 3-part series about the use of crowdfunding in health and biotech start-ups. We started with the story of a tech start-up which set records for funding through a Kickstarter campaign, triggering the interest of entrepreneurs in capital- intensive industries. Part 2 discussed the JOBS Act and the government’s attempt to overcome regulatory hurdles facing companies which want to use crowdfunding to raise equity investment capital. Part 3 addresses some Potential Dangers inherent in the system of crowdfunding being devised. We hope you find the series educational and invite you to contact the authors with questions.
PART III: First, the JOBS Act requires the SEC to issue complex implementing rules prior to crowdfunding becoming a reality. For any startup seeking funding through a crowdfunding source, the rules proposed by the SEC under the Act demand detailed disclosures regarding the company. The company must also describe exactly how the securities it is offering are being valued. Additionally, the Act requires ongoing, annual financial reports from the company after any successful crowdfunding campaign. These facts alone may scare off some entrepreneurs.
This is the second in a 3-part series about the use of crowdfunding in health and biotech start-ups. We started with the story of a tech start-up which set records for funding through a Kickstarter campaign, triggering the interest of entrepreneurs in capital- intensive industries (Part 1: The Beginning). Part 2 discusses the JOBS Act and the government’s attempt to overcome regulatory hurdles facing companies which want to use crowdfunding to raise equity investment capital. Part 3 will address some Potential Dangers inherent in the system of crowdfunding being devised. We hope you find the series educational and invite you to contact the authors with questions.
PART 2: he US government began to address these investment challenges through the Jumpstart Our Business Startups Act (JOBS Act) in April 2012. While companies like Kickstarter allow startups to sell products or services, the JOBS Act envisions companies actually selling equity in themselves through crowdfunding campaigns. Certain provisions of the JOBS Act allow investments by accredited investors, and Title III of the JOBS Act anticipates allowing large numbers of non-accredited individuals to invest in startup companies. Rules proposed by the Securities and Exchange Commission (SEC) to implement the Title III crowdfunding provisions of the JOBS Act were expected by the end of 2013, but they have continually been delayed. Expectations now place release of the rules at the end of 2015.
Politico, the popular political journalism publication, recently ran the story “Patent Reform Advocates: PTO Process Not Patent ‘Death Squad.’” The story was based on a blog post by patent reform advocate Unified Patents. Politico reported Unified Patents’ proclamation that the Patent Trial and Appeals Board (“PTAB” or “Board”) has ruled valid 62% of challenged claims. But this figure is misleading at best and even conflicts with data published by the USPTO.
Unified Patents is no mere patent reform advocate. Rather, the company exists to capitalize on the review processes put into play by certain provisions of the Leahy-Smith America Invents Act (“AIA”). Founded in 2012 – the same year that those provisions of the AIA went into effect – Unified Patents’ business model is to target non-practicing entities (“NPEs”) with inter partes review (“IPR”) proceedings. A stated goal of the company is to “zealously fight invalid patents” (see Unified Patents’ website). With respect to IPRs, patent reform advocates have remarked “how valuable it is to have [the AIA review] processes in place” (attributed to Beth Provenzano of United for Patent Reform).
In fact, Unified Patents has done more than simply remark on patent reform; it was a petitioner in 21 IPR proceedings, according to the USPTO’s publicly-available PTAB trial data. Of those 21 petitions, Unified Patents failed to have IPRs instituted on ten petitions and institution has not yet been determined for nine additional petitions. Of the two instituted decisions, only one has reached decision. Not surprisingly, the Board found all claims unpatentable.
On June 16, the Federal Circuit issued its first-ever reversal of a Patent Trial and Appeal Board decision in an America Invents Act post-grant proceeding. The opinion, drafted by Chief Judge Prost and joined by CAFC Judge Lourie and E.D. Tex. Judge Gilstrap, provides considerable guidance on claim construction and claim amendments in practice before the PTAB.
The case is Microsoft Corp. v. Proxyconn, Inc., No. 2014-1542 and 1543. It reached the Federal Circuit after Proxyconn asserted U.S. Patent No. 6,757,717 against Microsoft in the Central District of California, and Microsoft initiated two separate inter partes review proceedings against the patent (IPR2012-00026 and IPR2013-00109). The PTAB joined the two IPRs and granted review on certain claims. In its final written decision, the PTAB found all but one reviewed claim unpatentable and denied Proxyconn’s motion to amend its claims. Both parties appealed. The Patent Office intervened in support of the PTAB’s position.
The Federal Circuit vacated certain portions of the final written decision, holding that the PTAB’s claim constructions exceeded the “broadest reasonable interpretation” standard. The PTAB’s denial of Proxyconn’s motion to amend was not disturbed. Here are some key takeaways from the case:
On June 15, 2015, the United States Patent and Trademark Office (“USPTO”) issued Notice in the Federal Register announcing a new pilot program, the Expedited Patent Appeal Pilot. Under the program an appellant may have an ex parte appeal to the Patent Trial and Appeal Board (“Board”) accorded special status if the appellant withdraws the appeal of another application in which an ex parte appeal is also pending before the Board. According special status is a procedure under which an application is advanced out of turn. A stated goal of the Expedited Patent Appeal Pilot is to reduce the backlog of appeals pending before the Board. The pilot program also will allow appellants having multiple ex parte appeals pending before the Board to have greater control over the priority with which their appeals are decided. Petitions can be filed to participate in the pilot program until June 20, 2016, or until 2,000 petitions are granted, whichever occurs first.
This is the first in a 3-part series about the use of crowdfunding in health and biotech start-ups. We start with the story of a tech start-up which set records for funding through a Kickstarter campaign, triggering interest in crowdfunding by entrepreneurs in capital-intensive industries. Part 2 will discuss the JOBS Act and the government’s attempt to overcome regulatory hurdles facing companies which want to use crowdfunding to raise equity investment capital. Part 3 will address some Potential Dangers inherent in the system of crowdfunding being devised. We hope you find the series educational and invite you to contact the authors with questions.
PART 1: Pebble Technology had an interesting goal. It wanted to design and build a watch that could connect to iPhone and Android smartphones using Bluetooth. It wanted to allow the watch to alert a wearer with a silent vibration for incoming calls, emails and messages. The traditional path for Pebble Technology would have been to raise funds, first through angel investors and then—if it was lucky—through venture capital groups. It would build its Pebble watches. It would market them. And finally it would have attracted a large enough customer base to make its time and effort worthwhile (for the company and its investors).
For only the fourth time in its history, the Patent Trial and Appeal Board (“PTAB”) has granted a motion to amend in an inter partes review (“IPR”) proceeding, finding all substitute claims proposed by the patent owner patentable. In REG Synthetic Fuels LLC v. Neste Oil OYJ, IPR2014-00192 (the “‘192 IPR”), a 3-judge panel issued an order on June 5 that could be interpreted as moving away from prior PTAB decisions applying a strict standard for amending claims under 35 U.S.C. § 316(d) in an IPR proceeding. See ‘192 IPR, Paper 48. While these previous decisions have required patent owners to demonstrate that proposed substitute claims are patentable not only over the prior art of record, but also all prior art known to the patent owner, the REG v. Neste decision seems to focus almost exclusively on whether the proposed substitute claims are patentable over the prior art of record.
Petitioner REG Synthetic Fuels LLC (“REG”) challenged the patentability of U.S. Patent No. 8,278,492 (the “‘492 Patent”) owned by Neste Oil OYJ’s (“Neste”). Neste’s ‘492 Patent is directed to a process for manufacturing range hydrocarbons from bio oils and fats, also referred to as “biodiesel.” The ‘492 Patent discloses a two-step process where a feed stream is diluted with a hydrocarbon to create biodiesel. The inventors sought to remedy the problem of heat dissipation during deoxygenation by adding sulfur to the feed stream.
Administrative Law Judge Essex has made another important contribution to the ongoing conversation regarding the enforcement of standard essential patents (SEPs) at the International Trade Commission. Building on the analysis he presented in his Initial Determination in Commission investigation No. 337-TA-868, In the Matter of Certain Wireless Devices with 3G and/or 4G Capabilities and Components Thereof, Judge Essex recently issued the public version of his Initial Determination on Remand in investigation No. 337-TA-613, In the Matter of Certain 3G Mobile Handsets and Components Thereof, in which he provides a grounded, evidence-based framework for adjudicating the FRAND defense.
While Judge Essex’s decision is subject to Commission review, it is nevertheless noteworthy because it addresses several important questions related to the enforcement of SEPs: Continue Reading