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

In Vecco Instruments Inc. v. SGL Carbon, LLC, No. 17-CV-2217 (E.D.N.Y. Nov. 2, 2017), Judge Pamela Chen in the Eastern District of New York recently granted Vecco’s motion for a preliminary injunction enjoining SGL Carbon. The requested injunction sought to prevent SGL Carbon’s further actions related to its likely indirect infringement of Vecco’s asserted patents. Notable in this extensive and detailed 76-page decision is the Court’s discussion of how “long-term and second-order” effects of the accused infringer’s actions can satisfy the “irreparable harm” requirement of the preliminary injunction analysis.

Plaintiff Vecco designs, manufactures, and services LEDs, power electronics, hard drives, and other electronic devices.  It also owns patents related to metal-organic chemical vapor deposition (MOCVD) reactors, a technology that enables high-volume fabrication of metal-organic semiconductor wafers that can be turned into LEDs. Vecco enjoys a large share of the MOCVD market due, in large part, to a distinctive feature of its MOCVD reactors: a removable wafer carrier, typically made of graphite that is mounted on a spindle centrally positioned within the reactor. Vecco authorized SGL Carbon to manufacture these wafer carriers for Vecco and its customers, but in 2013, SGL Carbon began manufacturing wafer carrier for a new entrant into the MOCVD market. Vecco claims this constituted infringement of its MOCVD patents, and sought a preliminary injunction to stop this activity during the pendency of the patent litigation case.

Continue Reading Potential Future Harm to Patent Holder Found to Justify Imposition of Preliminary Injunction

Following a lengthy and extensive litigation that began in 2011 that culminated in a U.S. Supreme Court decision in December of 2016, smartphone industry titans Apple and Samsung will again find themselves in Federal District Court Judge Lucy Koh’s courtroom on remand to determine appropriate damages for Samsung’s infringement of Apple’s design patents.

Design Patent No. 593087

US Design Pat. No. 593,087

US Design Pat. No. 604,305

Design Patent No. 618677

US Design Pat. No. 618,677

As we have written before, Apple originally filed this patent infringement action in the U.S. District Court for the Northern District of California in 2011, alleging that, in relevant part, Samsung’s smartphones infringed three of Apple’s design patents. Judge Koh presided over the dispute. The jury found infringement of all three design patents, and the district court entered final judgment awarding $399 million attributable to Samsung’s infringement of the design patents. The Federal Circuit upheld the lower court’s judgment on the amount of damages for infringement of the design patents, and Samsung filed a petition for certiorari to the Supreme Court seeking reversal.

Continue Reading Apple and Samsung Are Headed Back to the Court Room

Last month, following a jury verdict in federal district court in Delaware awarding Plaintiff Idenix Pharmaceuticals LLC $2.54 billion in damages—“the largest damages verdict ever returned in a patent [infringement] trial”—Chief Judge Leonard Stark denied Idenix’s motion for enhanced damages. Idenix Pharm. LLC v. Gilead Scis., Inc., No. 14-CV-00846, at *2, 15 (D. Del. Sept. 22, 2017).  Chief Judge Stark determined that even though the jury concluded that Defendant Gilead Sciences, Inc. willfully infringed Idenix’s patent directed to novel treatments of the Hepatitis C Virus (“HCV”), the totality of the circumstances did not warrant the award of enhanced damages. He based the denial of the motion on the public health benefit of the accused products and on the amount of the jury award.

Continue Reading Chief Judge Stark Rejects Motion for Enhanced Damages Award Due to the Public Interest in the Accused Hepatitis C Virus Treatments

The public version of ALJ Shaw’s Initial Determination (ID) in U.S. International Trade Commission (ITC) investigation Certain Magnetic Data Storage Tapes and Cartridges Containing the Same, Inv. No. 337-TA-1012 (1012 Investigation), provides important guidance on enforcement of standard-essential patents (SEPs) in the ITC.  Respondent and accused infringer Sony argued that several of the patents asserted by patentee Fujifilm wereessential to the LTO-7 standard (relating to “linear tape open” magnetic media) and therefore that Fujifilm had waived its right to injunctive relief and was obligated to license its patents on FRAND terms.  ALJ Shaw ultimately found that Sony had not met its burden of demonstrating essentiality, but he nevertheless provided helpful instructions on the quantum of proof necessary to make out such a claim, as well as other factors relevant to ITC enforcement of SEPs, all of which affirmed that the ITC is a viable forum for enforcement of SEPs.  In sum he ruled that:

  • The party arguing that a patent is essential bears the burden of proof on that point;
  • Unless a patent is, in fact, essential to a given standard, there can be no breach of the standard-setting organization (SSO) agreement(s) giving rise to the FRAND obligation at issue;
  • Breach of an SSO agreement and of forum selection clauses are not valid defenses in ITC investigations; and
  • Respondents bear the burden of proving that a complainant/patentee relinquished its rights to equitable relief by joining the SSO in question.

Continue Reading ALJ Shaw: ITC is a Viable Forum for Enforcement of SEPs

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

The decision in U.S. International Trade Commission (ITC) investigation Certain Magnetic Data Storage Tapes and Cartridges Containing the Same, Inv. No. 337-TA-1012 (“1012 Investigation”), is still confidential, but the ITC has issued a notice stating that ALJ Shaw has ruled in favor of patentee Fujifilm against Sony and recommended that an exclusion order be issued.  This is important because it is the first time the ITC has issued an exclusion order on standard-essential patents (SEPs), and may be the first time any U.S. tribunal has issued exclusionary or injunctive relief on patents which were declared standard essential.   In the opinion, which should become public in a few weeks, ALJ Shaw, who presided over the case, is expected to address a number of key issues relating to the assertion of SEPs in general, and at the ITC specifically. In this case many of Sony’s affirmative defenses relate to the alleged essentiality of the asserted patents and the Administrative Law Judge was asked to answer a number of questions relating to SEPs generally and the ability to enforce them at the ITC.

Continue Reading Upcoming Opinion in ITC Expected To Provide Important Guidance on FRAND and SEPs

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

On July 20, 2017, the United States Court of Appeals for the Federal Circuit in In re OptumInsight denied OptumInsight’s petition for writ of mandamus on privilege waiver. The court held that the District Court for the Northern District of California did not clearly abuse its discretion in evaluating the proper scope of waiver.

The ‘897 patent reexamination. In June 1994, Symmetry Health Data Systems, Inc. (Symmetry) responded to a request for proposal (RFP) from Aetna Life Insurance Co. and offered to license its healthcare analytics software, Symmetry Episode Treatment Group (ETG) Program, to Aetna. More than a year later, Symmetry filed a patent application that claims and describes the ETG Program. During prosecution, Symmetry did not disclose its RFP response regarding the software license to the patent office. Symmetry’s application eventually issued as U.S. Patent No. 5,835,897.

Continue Reading Federal Circuit Says PTO Submissions Can Waive Privilege to Future Communications

In a first of its kind decision with important ramifications for patentees, the U.S. International Trade Commission (“ITC”) denied a petition to suspend or temporarily rescind remedial orders issued in Investigation No. 337-TA-945 pending appeal of the Patent Trial and Appeal Board’s (“PTAB”) separate finding that the patent claims at issue are invalid.  The ITC has therefore decided to continue to exclude products it found to be infringing certain patents, regardless of the PTAB invalidating the very patents the exclusion order is based upon in separate IPR proceedings.  While this decision aiding patentees may surprise some, it is consistent with the ITC’s practices regarding stays and of giving little deference to IPR proceedings.

Continue Reading ITC Denies Suspension or Temporary Rescission of Remedial Orders After PTAB Invalidates Patents at Issue