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Cuozzo SCOTUS Decision BRI is OK

Jim Ruttler, Patent Attorney

Posted Tuesday, June 21, 2016 by Jim Ruttler

Yesterday the Supreme Court decided Cuozzo and held that the broadest reasonable interpretation is fine during inter partes review proceedings. Cuozzo had wanted a more narrow standard during the proceedings, which are well known for being unfavorable toward patentees.

What standard of review is used during the proceedings is really irrelevant. Once your patent is pulled into one of these proceedings, the Patent Office is most likely going to invalidate most if not all of your patent - under whatever standard they apply.

The real issue here is that these PTO proceedings are unconstitutional because they take private property (patents) outside of the court system. If you get a patent, then the law since late 1800’s says that it is your private property. As private property, it can’t be revoked by the executive branch and is only subject to being taken away through the judicial system.

Unfortunately for the Patent Office, the Cuozzo win will likely be short lived as two new cases are up for review by the Supreme Court challenging the constitutionality of the entire inter partes review framework: Cooper and MCM. Cooper asks the Court to limit any Patent Office decisions as being advisory to a federal court judge. MCM asks the Court to outright invalidate the entire inter partes review.

We should know within a couple of months whether the IPR framework will remain or whether it will be scaled back.

If it isn’t scaled back, then there are many options for patent owners to minimize the downside risks of IPRs. We’ll save those for another post in the event that I’m wrong and IPRs are maintained by the Courts.

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Supreme Court Revives Treble Damages: Halo

Jim Ruttler, Patent Attorney

Posted Tuesday, June 14, 2016 by Jim Ruttler

In a significant victory for innovators, the U.S. Supreme Court this week made it easier for patent owners to obtain treble damages for infringement. Since 2007, the Federal Circuit Appeals Court and the lower District Courts have been applying a strict standard for treble damages. Essentially, they required clear and convincing evidence of willful infringement without any reasonable defense. Of course, it was easy for most patent litigators to concoct some reasonable defense after the fact during trial, so even the most egregious willful infringement avoided treble damages.

However, the Supreme Court has laid this test to rest and changed the rule to permit the lower District Courts considerable discretion in determining whether to avoid penalizing treble damages. The new test requires only that the case be out of the ordinary considering the behavior and actions of the infringer at the time of infringement. The standard has been lowered to preponderance of evidence (more likely than not) and infringers can’t escape by producing some reasonable defense later during trial. Furthermore, the District Court’s decision to institute treble damages is entitled to significant deference during any appeal of the damage award.

In short, this is a significant pro-patent change in the law. Now, any infringer who knows about a patent and the existence of infringement will have the potential for a very heavy toll of 3 times the total damages and the possibility of attorneys fees.

We are currently waiting for the decision by the Supreme Court in Cuozzo, which will likely result in significant limitations on the inter partes review proceedings at the Patent Office, further increasing the strength of patents. Also, the Supreme Court should be deciding whether to take up Cooper and MCM to possibly declare the entire inter partes review proceedings as unconstitutional.

My expectation is that the Supreme Court will limit inter partes review proceedings to be mini-court proceedings which apply the same post-grant court standards. I think also that the inter partes review proceedings will be held constitutional, so long as all the parties consent to the Patent Office’s jurisdiction. This will effectively permit parties to choose whether to litigate via the Patent Office or the Courts, but will prevent patent owners from being drug into the Patent Office against their will.

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Using Twitter Is Not a Regsiterable Trademark for Online Community Service

Daniel Mills, Trademark Attorney

Posted Friday, May 20, 2016 by Daniel Mills

When a trademark applicant sets up a social media account on Twitter in order to advertise or promote its business via a social-networking website, is it the applicant or Twitter that is providing the service of “creating an on-line community for users” interested in the applicant’s business? The answer is Twitter!

Thus began a recent decision by the TTAB that upheld a refusal to register SAY IT YOUR WAY application by FTD for its Twitter account for “Creating an on-line community for registered users to participate in discussions, get feedback from their peers, form communities, and engage in social networking featuring information on flowers, floral products and gifts.” (International Class 042)

The decision cited a recent update to Section 1301.04(h)(iv)(C) of the Trademark Manual of Examining Procedure(“TMEP”)in April 2016. The section states:

Some applicants may mistakenly mischaracterize their services as ‘social networking’ because they assume that advertising or promoting their non-social-networking services via a social-networking website means they are providing social-networking services. For instance, an applicant may mistakenly file an application for ‘online social-networking services’ and provide a Facebook® webpage as a specimen when, in fact, they operate a pet store and are only using the Facebook® website to advertise the pet store and communicate information to and messages with actual and potential customers. Such a specimen is not acceptable for the social networking services since it does not demonstrate that the applicant is providing these services

FTD’s position was that it’s use of Twitter created a sub-community within the Twitter universe, but the Board was not convinced that this use constituted “creating on online community” and held that Twitter is creating the service of on online community, not FTD. the Board noted that FTD “does not provide a platform by which its followers can create a profile, establish a homepage, and attract further followers.” Furthermore the Board agreed with the examining attorney that FTD was Applicant “simply acting to further the sale of its flowers, floral products and gifts by using its Twitter account to engage with consumers and potential consumers and promote its retail services.”

So the lesson here is that simply using a social media site even if that use is detailed, voluminous, and integrated into a business’s marketing plan, is not the same as creating a separate online community that creates a registrable trademark for that service.

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Google, Apple, IBM, Microsoft, Facebook and many others buying patents

Jim Ruttler, Patent Attorney

Posted Wednesday, May 18, 2016 by Jim Ruttler

Some of the Worlds largest companies are interested in buying your patents for prices you set. The Industry Patent Purchase Program (IP3) is a new method to create a secondary market for patents. Google, Apple, IBM, Microsoft, Facebook, Adobe, Honda, Hyundai, Kia, Verizon, Cisco, and many others are pooling resources and accepting patents for sale through AST. If accepted, sellers will receive payment within a few months.

Google did this alone about a year ago and apparently was successful enough that now the whole industry wants in on the purchases. Patents were sold to Google under this program for between $3k and $250k each depending upon the invention and interest.

This new program plus some recent court developments are indications that the patent market is about to come back to life, and I believe in a bigger way than anytime before.

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Federal Circuit Confirms Software Patent Eligibility

Jim Ruttler, Patent Attorney

Posted Sunday, May 15, 2016 by Jim Ruttler

Ever since the Supreme Court Alice decision, the Patent Office and the lower level District Courts have been over-reaching and invalidating software related patents. Now for the second time, the Federal Circuit has taken the lower courts to task by confirming that software continues to be eligible.

In Enfish v. Microsoft, the Federal Circuit Court of Appeals reversed the lower district court’s finding that Enfish’s database claims were ineligible and invalid. Instead, the Appeals Court found that the self-referential database claimed in Enfish was clearly the type of subject matter that remains eligible as compared to business method type claims.

The Court reasoned that software that improves the functionality of a computing device is different than a business method that is implemented on a computer. Thus, the former types of inventions remain patentable, which is very good news for patent owners and inventors worried about the Alice decision.

Patent law is stabilizing with this decision and 2016 will likely mark a continued strengthening of patent rights for technical inventions.

http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/15-1244.Opinion.5-10-2016.1.PDF

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