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Brad Scheller a Member in the firm’s New York office and focuses his practice on patent disputes in Federal District Courts and at the US Court of Appeals for the Federal Circuit. He has handled disputes involving a variety of technologies, including electrical components, electronic payment and financial systems, computer software, and various consumer products, including cosmetics, video game systems and personal watercraft. Brad also has significant experience representing clients in inter partes reviews and covered business method patent review proceedings before the Patent Trial and Appeal Board of the US Patent and Trademark Office.

On Monday, November 27, 2017, the Supreme Court heard oral arguments in SAS Institute v. Matal.

Issue presented

Whether 35 U.S.C. § 318(a) requires that the Patent Trial and Appeal Board (PTAB or Board) issue a final written decision as to every claim challenged by a petitioner, or does it allow the Board to issue a final written decision with respect to the patentability of only some of the patent claims challenged by the petitioner.

Background

On September 14, 2012, ComplementSoft sued SAS in the Northern District of Illinois for infringement of U.S. Patent No. 7,110,936.  On March 29, 2013, SAS filed a petition with the PTAB for inter partes review (IPR) of the ‘936 Patent, challenging patentability of all 16 claims of that patent.  The PTAB instituted IPR as to 9 claims (1 and 3-10) of the ‘936 patent and on August 6, 2014 issued a final written decision under 35 U.S.C. § 318(a), holding that claim 4 was not invalid over prior art, whereas claims 1-3 and 5-10 were unpatentable.  SAS’ request for rehearing before the Board was denied.  On June 10, 2016, the 2-1 divided Panel of the Federal Circuit Rejected SAS’s argument that the Board must address all claims challenged in an IPR petition in its final written decision, and affirmed the PTAB’s decision, except vacated with respect to claim 4.   The Panel consisted of Judges Stoll, Chen, and Newman, with Judge Newman dissenting in part.  As Judge Stoll stated, there is “no statutory requirement that the Board’s final decision address every claim raised in a petition for inter partes review.  Section 318(a) only requires the Board to address claims as to which review was granted.” The Federal Circuit reasoned that 35 U.S.C. § 314  and 35 U.S.C. § 318(a) are different and that § 318(a) “does not foreclose the claim-by-claim approach the Board adopted [in Synopsys] and in this case.” In a dissenting opinion, Judge Newman stated that 35 U.S.C. § 314(a) required USPTO either refuse to institute IPR entirely, or to review all challenged claims when “there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.”

Continue Reading SAS v. Matal – Overview of Oral Arguments in the Supreme Court

On November 21st, the PTAB issued guidance on motions to amend based on the Federal Circuit’s en banc decision in Aqua Products, Inc. v. Matal, 872 F.3d 1290 (Fed. Cir. 2017). In view of the Aqua Products decision, the PTAB will not place the burden of persuasion on the patent owner with respect to the patentability of substitute claims presented in a motion to amend. Instead, after the patent owner files a motion to amend, the Board will determine whether the substitute claims are unpatentable by a preponderance of the evidence based on the entirety of the record, including the opposition by the petitioner.

Continue Reading PTAB Guidance on Motions to Amend in View of Aqua Products

In issuing its precedential decision earlier this month in Two-Way Media v. Comcast, the Federal Circuit affirmed a Delaware district court determination that four data streaming patents were directed to ineligible subject matter pursuant to § 101 and the Alice framework. The four related patents (U.S. Patent Nos. 5,778,187, 5,983,005, 6,434,622, and 7,266,686) describe methods and systems for streaming audio/visual data over a communications system (e.g., the Internet) and, in particular, a scalable architecture for delivering real-time information to a number of users, including a control mechanism allowing for management and administration of users intended to receive the real-time information.

Under Alice step one, the Court found that the patents claimed the abstract idea of sending and monitoring the delivery of audio/visual information. The Federal Circuit agreed with this characterization of the claims, finding that the claims used results-based functional language with no articulation of how the particular results are achieved. Two-Way Media also proposed claim constructions that it argued tied the claims to a scalable network architecture. Even after adopting Two-Way Media’s propose constructions, both the District Court and the Federal Circuit found that the constructions, at best, encompassed using generic computer components to carry out the abstract idea and still failed to indicate how the claims themselves “are directed to a scalable network architecture that itself leads to an improvement in the functioning of the system.” (emphasis added) Continue Reading Federal Circuit Affirms Delaware Alice Decision

On September 6, 2017, an expanded panel of the Patent Trial and Appeal Board issued an “informative” decision in General Plastic Industrial Co., Ltd, v. Canon Kabushiki Kaisha setting forth the Board’s framework for analyzing follow-on inter partes review (IPR) petitions.  In response to five concurrent requests for rehearing, a panel of seven administrative patent judges reviewed the factors articulated in NVIDIA Corp. v. Samsung Elec. Co., IPR2016-00134, Paper 9 (PTAB May 4, 2016) and, in doing so, denied all five requests.  While acknowledging that multiple petitions challenging the same patent may be permitted based on specific facts of each case, the Board explained that follow-on petitions run the risk of undue inequities and prejudices to patent owners, and petitioner’s submission of multiple, staggered petitions constituted “an inefficient use of the inter partes review process and the Board’s resources.”

Continue Reading General Plastic Industrial Co. v. Canon Kabushiki Kaisha: PTAB Explains Factors for Follow-On Petitions

The Federal Circuit yesterday issued an opinion in In re: Smith Int’l, Inc., No. 2016-2303 (Fed. Cir. Sept. 26, 2017) reversing an affirmance by the Patent Trial and Appeal Board of the rejection of several claims of U.S. Patent No. 6,732,817 being challenged in ex parte reexamination.  In so doing, the Court held the Board’s construction of “body” in the ’817 Patent claims to be unreasonable as inconsistent with the specification.

The ’817 Patent concerns a downhole drilling tool for oil and gas operations.  In affirming the examiner, the Board found it “perfectly reasonable” to interpret the “body” of the tool as encompassing other components because neither the claims nor the specification explicitly limit the scope of the term.  Even though the specification describes the body as separate from other elements, the Board reasoned that it doesn’t expressly define “body” or otherwise preclude the examiner’s interpretation.  But according to Smith, the ’817 Patent consistently refers to and depicts the body as a component distinct from other components of the drilling tool – like the “mandrel” or “piston” located inside the drilling tool – and should be interpreted simply as an “outer housing.”

Continue Reading “In Light of the Specification”: Federal Circuit Weighs in on the Broadest Reasonable Interpretation

On August 25, 2017, the Patent Trial and Appeal Board issued a precedential opinion in Ex Parte McAward, reaffirming the Patent Office’s use of a lower pre-issuance threshold for indefiniteness distinct from the Supreme Court’s Nautilus standard.

A Tale of Two Standards

Under 35 U.S.C. § 112(b), the specification must conclude with “one or more claims particularly pointing out and distinctly claiming the subject matter” regarded as the invention. This definiteness requirement “secure[s] to the patentee all to which he is entitled” and “apprise[s] the public of what is still open to them.” Markman v. Westview Instruments, Inc., 517 U.S. 370, 373 (1996).

During examination, the Patent Office applies the broadest reasonable interpretation of a claim and thereafter determines indefiniteness using the In re Packard standard, in which a claim is indefinite when it contains words or phrases whose meaning is unclear. See In re Packard, 751 F.3d 1307, 1310 (Fed. Cir. 2014)(per curium).

Continue Reading Am I Being Clear Enough? – PTAB Reaffirms Lower Pre-Issuance Threshold for Indefiniteness in Ex Parte McAward

Last week, the Federal Circuit held computer memory system patent claims not abstract and thus patent-eligible under Section 101, reversing a lower court dismissal of the case under Rule 12(b)(6).  Visual Memory LLC v. NVIDIA Corp., No. 2016-2254, 2017 U.S. App. LEXIS 15187 (Fed. Cir. Aug. 15, 2017).

U.S. Patent No. 5,953,740 (“the ‘740 patent”) describes a memory system that can be tailored for use with multiple different processors without reducing performance.  Id. at 3.  The ‘740 patent explains that when “the [memory] system is turned on, information about the type of processor is used to self-configure the programmable operational characteristics.”  Visual Memory, No. 2016-2254, slip op. at 4.  “For example, depending on the type of processor, internal cache 16 can store both code and noncode data, or it can store only code data.”  Id. at 4.  Claim 1 recites the following:

Continue Reading In a Reversal, Federal Circuit Finds Data Processing Claims Patent-Eligible Under Section 101 in Visual Memory v. NVIDIA

The Supreme Court’s decision five months ago in TC Heartland v. Kraft Food Group Brands was a sea change in the way courts interpret venue for patent infringement cases.  Since the Federal Circuit’s decision in VE Holding Corp. v. Johnson Gas Appliance Co., 917 F.2d 1574 (Fed. Cir. 1990), venue in patent infringement cases has been determined using 28 U.S.C. § 1391(c), which equates a corporate defendant’s residence with personal jurisdiction.  In TC Heartland, the Supreme Court effectively abrogated VE Holding by finding that a corporate defendant “resides” only in its State of incorporation for venue purposes.

Continue Reading District Courts Remain Split on TC Heartland and Waiver of Improper Venue Defense

The U.S. Supreme Court announced its ruling in TC Heartland v. Kraft Foods Group Brands LLC on May 22, 2017, a patent infringement case that has garnered national attention for its implications on venue. This case originated with a motion to transfer an action filed in the District of Delaware to the Southern District of Indiana, where the Defendant accused of patent infringement is headquartered. However, the national attention has focused on the possibility that a significant amount of other patent litigation may now shift to the District of Delaware. The U.S. Supreme Court granted certiorari at the end of last year and heard oral arguments in March to address the question of “where proper venue lies for a patent infringement lawsuit brought against a domestic corporation.” The Court has now provided a response to this key question, although a few issues still remain.

Continue Reading Patent Litigation Venue: Supreme Court Clarifies Venue Statutes in TC Heartland v. Kraft Foods.

Last week the Federal Circuit in Helsinn Healthcare v. Teva Pharmaceuticals clarified the scope of the on-sale bar rule under the America Invents Act (AIA).  The on-sale bar in general means that a sale or an offer to sale of an invention more than one year prior to the effective filing date of a patent qualifies as prior art.  The Federal Circuit held that 35 U.S.C. § 102 as revised in the AIA does not change the long-settled rule that a sale can invalidate an invention even if the sale does not disclose the details of the invention.

Continue Reading Federal Circuit Clarifies the On-Sale Bar under AIA