The Western District of Pennsylvania Weighs in on the Admissibility of Facebook Posts

by: Kelly A. Williams, a shareholder at Picadio Sneath Miller & Norton, P.C.

wd-pa-courthouseIn Newill v. Campbell Transp. Co., plaintiff sought to preclude defendant from introducing several of his Facebook posts into evidence on the bases that the posts were irrelevant or would be unfairly prejudicial. The case involved personal injury claims and employability issues. Defendant had obtained Facebook posts showing plaintiff engaging in physically taxing activities and posts showing plaintiff using “casual or rough language.” Defendant sought to use the physical activity posts to show that plaintiff retained the ability to engage in physical activities and sought to use the “language” posts to argue that plaintiff would have been employed had he not posted questionable language on Facebook.

The court held that the physical activity posts were relevant and admissible for the purpose of showing plaintiff could engage in physical activity but that his posts of “casual or rough” language were not admissible for supporting the claim that he remained unemployed because of these posts. With respect to the physical activity posts, the court ruled that plaintiff’s claim that he was embarrassed by the posts was not sufficient to preclude their admissibility generally. However, the court did state that it would be willing to assess particular posts at trial and whether there was a sufficient basis for excluding them under Federal Rule of Evidence 611 (granting the court discretion to bar harassment and undue embarrassment of a witness). As to the claim that the “language” posts interfered with plaintiff’s ability to find employment, the court held that this was speculation on the part of defendant’s expert, and therefore, they were inadmissible.

Newill v. Campbell Transp. Co., 2:12-cv-1344 (W.D. Pa. Jan. 14, 2015). The full opinion can be found here.

SCOTUS Decides That the Issue of Trademark “Tacking” Is One for a Jury

by: Kelly A. Williams, a shareholder at Picadio Sneath Miller & Norton, P.C.

This week the United States Supreme Court determined that a jury should decide the issue of whether “tacking” can be used by a trademark holder to assert a priority position.

Hana Bank LogoIn Hana Financial, Inc. v. Hana Bank, No. 13-1211 (decided January 21, 2015), Hana Financial sued Hana Bank for trademark infringement. Hana Bank asserted the doctrine of tacking as a defense, claiming that its mark came first. This argument is relevant because under trademark law, rights in a trademark are determined by the date of the mark’s first use in commerce. In other words, the party who uses a mark in commerce first is given priority over other users. The doctrine of tacking arose from courts’ recognition that trademark users ought to be able to modify their marks over time without losing priority (for instance, think of the Aunt Jemima mark: The mark dates to 1893 but Aunt Jemima has changed her appearance over the years. Thanks to the tacking doctrine, the owner of the mark, currently Quaker Oats Company, keeps that 1893 priority date. Fun Fact: The Aunt Jemima mark actually changed trademark law in the United States. (See this article for details.)   A trademark holder may use “tacking” when the original and revised trademarks are “legal equivalents” in that they create the same, continuing commercial impression. In short, tacking applies when a consumer considers both marks to be the same despite a modification.

The Supreme Court, in an opinion delivered by Justice Sotomayor, concluded that because the tacking inquiry operates from the perspective of an ordinary purchaser or consumer, a jury should make the determination of whether the modified mark creates the same, continuing commercial impression. Prior to this ruling, there had been a split in the federal circuit courts as to whether tacking was a question for the jury or the court. The Supreme Court has now decided the issue. Note, that the Supreme Court did acknowledge that the issue of tacking could still be decided by a judge on a motion for judgment as a matter of law or on a motion summary judgment under the right set of facts.

So which bank won? Hana Bank. Hana Bank convinced a jury that the doctrine of tacking applied to its mark such that it had priority over Hana Financial. Based on the Supreme Court’s ruling, the jury verdict will stand.

Teva Pharmaceuticals v. Sandoz–Supreme Court Changes Appellate Review of Claim Constructions

by: Robert Wagner, intellectual property attorney at the Pittsburgh law firm of Picadio Sneath Miller & Norton, P.C. ()

SupremeCourtImage_1Yesterday, the Supreme Court issued another opinion in the patent arena in Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc. (No. 13-854). In this decision, the Court  considered what deference, if any, that appellate courts should have when reviewing a district court’s claim construction. In a 7–2 opinion authored by Justice Breyer (Justices Thomas and Alito dissenting), the Court reaffirmed that appellate courts review claim constructions de novo, but held that underlying factual determinations made by a district court should be reviewed under a clear error standard. Thus, this is somewhat of a mixed bag decision whose practical importance is unclear.

Reasoning of the Court

The Court started off by reaffirming its determination in Markman v. Westview Instruments, Inc., 517 U.S. 370 (1996) that claim construction is a question of law for the courts, even when it may require evidentiary determinations. The Court then noted that Federal Rule of Civil Procedure 52(a) sets the framework for an appellate court’s review of findings of fact made by a district court. Under Rule 52(a)(6), a court of appeals must not set aside a district court’s findings of fact unless they are clearly erroneous. Under the Court’s precedent, this standard applies to all types of factual findings made by a district court, including findings relating to subsidiary and ultimate facts. The Court then found that there was no exception to Rule 52(a) for patent cases, either by statute or based on its case law. Based on this determination, the Court concluded that appellate courts must review factual findings made by a district court during the claim construction process under a clear error standard of review, and not a de novo standard.

Unlike many Supreme Court decisions, the Court then went on and attempted to clarify how appellate courts should review claim constructions from district courts. When a court considers intrinsic evidence to the patent (the patent claims, specification, drawings, and prosecution history) when determining its construction, appellate courts are to review those determinations using a de novo standard of review. However, when a district court considers extrinsic evidence (such as expert testimony), any factual findings related to that extrinsic evidence must be reviewed on a clear error basis. Finally, the ultimate construction is still to be reviewed on a de novo basis, even if it contains issues of fact.

Consequences of the Decision

As with any decision, it is sometimes hard to predict the consequences immediately after the decision issues. But, there are some take-aways from this decision. First, district courts will likely have to do some more work, especially when they are making factual determinations relating to claim construction. District courts will now have to make those findings explicit if they expect the Federal Circuit to give the findings deference.

Second, parties will have to consider whether introducing more extrinsic types of evidence will be beneficial or harmful to their cases. It may be that in certain circumstances a party will feel so confident of its position before a district court that it will want as many factual determinations as possible to support its hoped-for ruling by the district court. On the other hand, if it ultimately loses on construction, those factual findings will make it harder for to argue for reversal. So, parties will need to be careful in thinking about what makes the most sense in their particular circumstance.

Third, it will be interesting to see what the Federal Circuit does. The Supreme Court confirmed that the ultimate decision is still made on a de novo basis. This means that the Federal Circuit may simply accentuate or minimize the factual findings as needed to affirm or reverse based on its own interpretation, which may make little practical difference in the outcomes of cases.

Many claim constructions do not turn on factual findings relating to extrinsic evidence, so this decision is unlikely to radically change how patents are litigated. In the margins, where factual determinations and understandings are truly important, it likely makes sense to give deference to the district court, especially when it had the chance to hear live testimony by experts on disputed issues and to weigh issues of credibility.

For some further initial impressions of the Court’s decision, check on this article on the Patently-O blog, in which Professor Crouch talked with a number of patent law experts for their impressions.

Beer Drinkers Bring Down Trademark Litigation

by: Kelly A. Williams, a shareholder at Picadio Sneath Miller & Norton, P.C.

You might wonder what could cause people to take to social media to rail against a trademark suit. It turns out one thing is beer: IPAs to be more exact.

 

Law360 and CNBC reported this week about the social media backlash that occurred when Lagunitas Brewing Co. brought a trademark suit against Sierra Nevada Brewing Co. over the use of “IPA” on labels for India Pale Ale. The backlash was so great that Lagunitas moved to dismiss its lawsuit just two days after it filed the suit.

For those of you who practice in the area of trademark law, you might quickly jump to the conclusion that the suit was a weak one given that the term IPA sounds very “descriptive” or “generic” at first glance. However, the suit wasn’t that simple. Lagunitas didn’t just oppose the use of “IPA” on the label, and in fact there are a lot of beers out there with “IPA” on the label (yes, I’ll admit I’m pretty well aware of these other beers having tried a few myself). Lagunitas’ objection was the way in which Sierra Nevada designed its logo, which allegedly looked very similar to Lagunitas’.

Whether Lagunitas would have ultimately prevailed in a court of law is up for debate. However, Lagunitas appeared to be losing in the court of public opinion and that was enough to push it to withdraw the suit. This is an interesting issue for IP practitioners to keep in mind in those cases where a client’s business is dependent upon favorable public opinion.

Other sources for this article: Law360.

Federal Circuit Again Splits on Willful Infringement

by: Robert Wagner, intellectual property attorney at the Pittsburgh law firm of Picadio Sneath Miller & Norton, P.C. ()

6436135 ImageThe Federal Circuit issued another contentious decision on the subject of willful infringement on Tuesday in Bard Peripheral Vascular, Inc. v. W.L. Gore & Associates, Inc., (No. 2014-1114), splitting 2-1 and with another judge calling for the Circuit to revisit the law in this area.

The Bard-Gore case has had a long and tortured past, beginning more than 40 years ago. Gore, which makes an ePTFE polymer under the brand name Gore-Tex®, invited Dr. David Goldfarb to its facilities in 1973 to participate in a study of Gore’s product for use as a vascular prosthesis. Gore was trying to find new uses for its product, including in the medical fields. Based on the materials that Gore provided to Dr. Goldfarb, Dr. Goldfarb filed a patent application on the structure of the most effective of the samples he tested back in 1974. Peter Cooper from Gore had previously filed a patent application, and the USPTO conducted an interference proceeding.

In the interference proceeding, the USPTO concluded that Cooper was the first to conceive of the subject matter of the invention, but Dr. Goldfarb was the first to reduce it to practice. Therefore, the USPTO awarded the patent to Dr. Goldfarb. The Federal Circuit affirmed, and the patent ultimately issued in 2002. During the pendency of this dispute, Gore continued to develop and sell ePTFE grafts and medical devices.

In 2003, Dr. Goldfarb and Bard sued Gore for infringement (previously, Dr. Goldfarb licensed the patent to Bard). The jury returned a verdict of willful infringement and awarded over $185 million in damages, which the district court doubled. The district court also awarded attorneys’ fees and costs. The Federal Circuit affirmed in a split panel, but the full Circuit vacated the decision in a rehearing en banc, ordering the district court to reconsider the willful infringement finding de novo. The district court reconsidered the evidence and reinstated its prior judgment. The Federal Circuit, in this decision, affirmed in a 2-1 decision with three separate opinions.

Judge Prost, writing the opinion of the Court, reviewed the evidence de novo and concluded that Gore’s defenses were not reasonable. In particular, the Court rejected the notion that the fact that a prior member of the panel at the Federal Circuit dissented does not mean that Gore’s position was reasonable. The Court did not want to create the precedent that a single dissenting view would preclude a finding of willful infringement as a matter of law.

Judge Hughes wrote a concurring opinion in which he called into question the Federal Circuit’s jurisprudence on willful infringement—in particular, the two-part objective-subjective test and the de novo standard of review. He believes that the full panel should reconsider the law in this area and should apply a deferential standard of review.

Finally, Judge Newman wrote a strong dissent in which she would have reversed the district court’s decision on willfulness. She was troubled by the majority’s failure to discuss what she believed to be relevant evidence supporting Gore’s position. She was also troubled by the fact that the district court refused to enjoin Gore from selling its products but then enhanced the damages.

This decision is another in which the judges on the Federal Circuit are openly questioning the current state of the law on willful infringement. It will be interesting to see if the Federal Circuit rehears one of these cases en banc to settle the disagreements that are brewing internally.

 

 

The “Dip & Squeeze®” Battle Continues

by: Kelly A. Williams, a shareholder at Picadio Sneath Miller & Norton, P.C.

On January 7, 2015, the District Court for the Western District of Pennsylvania denied H.J. Heinz Company’s latest motion for summary judgment in Wawrzynski v. H.J. Heinz Company, 2015 U.S. Dist. LEXIS 1682 (W.D. Pa. Jan. 7, 2015). This suit is centered on whether Heinz used Mr. Wawrzynski’s ideas for condiment packaging in developing its “Dip & Squeeze®” package. In a somewhat unusual intellectual property case, Mr. Wawrzynski did not sue for patent infringement, although he had a patent for similar packaging. Instead, he sued for breach of implied contract and unjust enrichment.

HeinzThe facts giving rise to the suit are these. Mr. Wawrzynski asserts that he met with Heinz to discuss his patented ideas for condiment packaging called “The Little Dipper,” which would allow users to squeeze the condiment out or allow a user to dip food into the condiment. Mr. Wawrzynski alleged that he “intended that if someone used his design and/or his marketing materials that he would be paid for his efforts.” Mr. Wawrzynski also alleged that he was asked to develop 100 samples incorporating his design and marketing ideas for some focus groups.   Mr. Wawrzynski alleges that Heinz suddenly and mysteriously stopped communicating with him, and he later received a letter from Heinz stating that it was no longer interested in his ideas. A few months later, Heinz started selling ketchup in the “Dip and Squeeze” package.

Mr. Wawrzynski sued Heinz for breach of implied contract and unjust enrichment based on Heinz’s alleged use of his ideas for the new package and/or for marketing the new package, without compensating him. The complaint also mentioned Mr. Wawrzynski’s patent for his condiment packaging. Heinz counterclaimed claiming that it did not infringe Mr. Wawrzynski’s patent and that his patent was invalid. Mr. Wawrzynski admitted that Heinz was not infringing upon his patent and agreed not to sue based upon the patent. Thereafter, Mr. Wawrzynski moved to dismiss the counterclaim(s), and Heinz simultaneously moved for summary judgment on the grounds that Mr. Wawrzynski’s state law claims were preempted by federal patent law. The district court denied the motion to dismiss the counterclaim, ruling that the complaint made allegations based on his patent. However, the district court granted summary judgment to Heinz, finding that Mr. Wawrzynski’s state law claims were preempted. The district court also granted Heinz summary judgment on its counterclaim.

Mr. Wawrzynski appealed and the case went to the Federal Circuit, which has jurisdiction over patent actions. It does not have jurisdiction over pure state causes of action. Heinz argued that Mr. Wawrzynski’s suit was based on patent infringement. The Federal Circuit disagreed given that the complaint only had the two state law claims and lacked allegations of infringement. Consequently, the Federal Circuit transferred the case to the Third Circuit.

The Third Circuit vacated the district court’s summary judgment ruling. The Third Circuit ruled that the district court erred in considering Mr. Wawrzynski’s patent as grounds for dismissal. The case then went back to the district court.

Heinz moved for summary judgment again on the grounds that Mr. Wawrzynski could not prove his common law theories of breach of implied contract and unjust enrichment.

The district court denied Heinz’s motion based upon Pennsylvania law, which recognizes an implied relationship or implied contract where a defendant “has used for its benefit any property of the plaintiff in such manner and under such circumstances that the law will impose a duty of compensation therefor.” Thomas v. R. J. Reynolds Tobacco Co., 350 Pa. 262, 38 A.2d 61, 63 (Pa. 1944). Based on the facts of Thomas, the district court concluded that the Pennsylvania Supreme Court in Thomas held that “[a] relationship between two parties can be inferred when a plaintiff has property rights in an advertising idea which a defendant appropriates.”   However, to have a property right to an idea, the idea must be concrete, as well as “novel and new.” Thus, in Wawrzynski, the issue is whether Mr. Wawrzynski provided Heinz with novel, or original ideas, which Heinz did not already envision: 1) a condiment container with dual functionality; and 2) a successful advertisement and/or marketing method for a dual-functional container. This issue, whether Mr. Wawrzynski provided Heinz with novel ideas, created an issue of fact based upon the record in the case, which precluded entering summary judgment on either implied contract or unjust enrichment, as the issue was the same for Mr. Wawrzynski’s unjust enrichment claim.

The case is currently scheduled for a jury trial beginning on March 30, 2015.

In addition to the court’s opinion, the following sources were used in this blog:

http://www.naturalnews.com/042558_Heinz_patents_condiment_packaging.html

http://www.bizjournals.com/pittsburgh/news/2014/07/23/inventors-lawsuit-against-heinz-over-dip-squeeze.html?page=all

http://patentlyo.com/patent/2013/09/wawrzynski-v-hj-heinz-company.html

http://www.thelegalintelligencer.com/home/id=1202714255637?cn=20150107&pt=PM%20Legal%20Alert&src=EMC-Email&et=editorial&bu=The%20Legal%20Intelligencer&slreturn=20150011222335

 

 

 

Fed Circuit Reverses Willful Infringement Finding

by: Robert Wagner, intellectual property attorney at the Pittsburgh law firm of Picadio Sneath Miller & Norton, P.C. ()

(Cross-posted at DRI Community Page)

The Federal Circuit on Friday issued an opinion that struck a judge’s finding of willful infringement and the corresponding award of triple damages in Stryker Corp. v. Zimmer, Inc. (No. 13-1668). The Court concluded that the defendants’ defenses were not objectively unreasonable, even though they were unsuccessful at trial. Chief Judge Prost wrote the opinion, which was joined by Judges Newman and Hughes.

Background

US06179807-20010130-D00000Stryker and Zimmer are competitors in the medical device industry, and, in particular, the orthopedic pulsed lavage device market. Three patents were in suit (Nos. 6,022,329, 6,179,807, and 7,144,383); all of which involved pulsed lavage devices that deliver pressurized irrigation for certain medical therapies, including orthopedic procedures and cleaning wounds. The patents claimed portable, handheld, battery-powered devices that represented an improvement over the older systems that were larger and more cumbersome to use.The district court granted summary judgment of partial infringement of the ‘807 and ‘383 patents, and the jury found infringement of the ‘329 patent. The jury rejected Zimmer’s invalidity defenses and then awarded $70 million in lost profits, which the district court trebled after finding that Zimmer willfully infringed. The Federal Circuit affirmed both the infringement findings, although it noted that the questions were close, and the non-invalidity findings. It did, however, reverse the district court’s finding that Zimmer willfully infringed.

Willful Infringement Discussion and Analysis

For purposes of this post, I am going to focus on the willful infringement discussion by the Federal Circuit. The Court started off with the standard recitation of the In re Seagate Tech., LLC, 497 F.3d 1360 (Fed. Cir. 2007) (en banc) test. First, the patentee must show by clear and convincing evidence that the infringer acted despite an “objectively high likelihood that its actions constituted infringement of a valid patent.” The state of mind of the infringer is not relevant to this inquiry, so the fact that an infringer may not have be aware of or was not considering these defenses while it was infringing is not relevant. If the infringer’s position is “susceptible to a reasonable conclusion of non infringement,” the patentee has failed to prove the objective prong. If the patentee can show that the infringer was objectively reckless, then it must also show by clear and convincing evidence that the “objectively-defined risk (determined by the record developed in the infringement proceeding) was either known or so obvious that it should have been known to the accused infringer.”

The district court did not analyze the objective nature of the infringement, but, instead, focused on the subjective portion. It concluded that Zimmer acted willfully because: (1) Zimmer “all but instructed its design team to copy Stryker’s products”; (2) Stryker’s patents were pioneering; and (3) the secondary considerations of non-obviousness “made it dramatically less likely that Zimmer’s invalidity arguments were reasonable.” The Federal Circuit found this approach to be in error, because the district court failed to analyze the objective prong of the Seagate test first.

Under Seagate, the Federal Circuit started with the objective prong. It considered Zimmer’s defenses to each patent and ultimately concluded that none of them were unreasonable. As such, Stryker failed to prove by clear and convincing evidence that Zimmer was objectively reckless, which meant that the district court’s willful infringement finding had to be reversed.

For example, the Federal Circuit noted that in order to prove infringement of the ‘329 patent, Stryker had to obtain a broad construction of one of the terms in the patent (“handle”), which was not explicitly supported by the specification. It then had to convince the jury that a component of the infringing device (a motor) was located in the handle, even though it was not precisely located in the handle. And, Stryker had to overcome some statements during prosecution that were relevant to the location of the motor. Ultimately, the Federal Circuit found Zimmer’s position was not unreasonable.

With respect to the ‘807 patent, Stryker also had overcome prior art that was very close to the claims of the patent and had to overcome a non-infringment position that was not unreasonable. Finally, with respect to the ‘383 patent, Zimmer relied on an obviousness defense based on references identified by the PTO examiner during prosecution of a related patent. The Federal Circuit concluded that it was not unreasonable to believe that the claims were invalid based on these references.

Conclusions

This case highlights some important factors for accused infringers. Courts must be made aware of the fact that the objective prong should be considered in isolation from the accused infringer’s conduct and knowledge. It is to be assessed based on the objective record developed during the entire course of the litigation, which may include defenses that were not known to the accused infringer until after the litigation began. This segregation can be especially important where, as it appears was the situation in this case, there is strong evidence of copying.

The Federal Circuit also looked to what PTO examiners were doing during the prosecution of related patents. The Court did not go so far as to say that a PTO examiner’s rejection forms a reasonable basis that would prevent a finding of objective recklessness (which it likely could not given that the prosecution was of a related patent, and not the patent in suit), but it did look at what was being done in its objectiveness analysis. Finally, the Court seemed to put an emphasis on the fact that the infringer’s defenses were based on the plain meaning of the claim terms, as opposed to more convoluted meanings. Developing strong infringement defenses is always important, but it becomes doubly so when willful infringement is at issue.

What Is a Copyright?

by: Robert Wagner, intellectual property attorney at the Pittsburgh law firm of Picadio Sneath Miller & Norton, P.C. ()

PSMN What Is...? SeriesIn the next installment of our continuing “What Is?” series, we are going to discuss copyrights. One of the core intellectual property rights that exists under U.S. law is a copyright. In a nutshell, it is a legal right that provides authors of certain types of original and expressive works that have been fixed in a tangible medium the right to prevent others from using the work without the author’s permission. Obviously, there is a lot more detail behind this, so we will only cover some of the basics in this post.

First, only certain types of works are eligible for copyright protection. They include (1) literary works, (2) musical works, (3) dramatic works, (4) choreographic works, (5) pictorial, graphic, and sculptural works, (6) motion pictures and other audiovisual works, (7) sound recordings, and (8) architectural works. In addition, the work must have been fixed in a tangible medium to be eligible for a copyright—e.g., written down, put on film, or written in a computer. Certain things cannot be copyrighted, such as (1) things that have not been fixed in a tangible form (e.g., thoughts in your head or speeches that are not recorded or written down), (2) titles, names, and short phrases, (3) ideas, methods, inventions, or systems, and (4) standardized and commonly known information, such as standard calendars, tape measures, and lists or tables of publicly known information.

Second, in order to be eligible for a copyright, the work must be original. But, it does not have to be novel. In other words, the author must show that he or she created the work (and did not copy it from someone else), but the author does not have to show that he or she was the first to ever think of the work.

If an author can satisfy these requirements, he or she has a copyright. Under the change in federal law in 1976, a copyright exists under federal law the moment an author fixes an original expressive work in a tangible medium. There is no longer the need to affix a copyright symbol to the work or register the work with the U.S. Copyright Office. But, and this is a big but, there are a number of important advantages to registering a work with the Copyright Office that can be lost if not done timely. So, it is best for an author to consult an intellectual property attorney if there is the possibility that the work may be valuable or need to be protected.

A copyright gives an author a number of substantive legal rights, such as the ability to control who (1) reproduces or distributes copies of the work, (2) creates derivative works based on the original, and (3) performs or displays the work publicly. An author can sue an individual or company that violates these rights and collect damages, statutory penalties, or obtain a court order preventing the infringer from violating these rights in the future. In some cases, copyright infringement can even be a crime.

Because a copyright is a property right, it can be sold, transferred, or licensed like other types of real and intellectual property.

As of January 1, 1978, a copyright lasts for the lifetime of the author plus 70 years. If the work was made for hire or was published anonymously/psuedonymously, the copyright lasts for the shorter of 95 years from publication or 120 years from creation.

For more information about copyright, you can read this nice summary by the United States Copyright Office.

In upcoming posts, we’ll talk about some other issues involving copyrights, such as the fair use defense, what kind of remedies are available to authors whose works have been improperly copied, and the work-for-hire doctrine, among other things.

Federal Circuit Confirms Invalidity of Reissue Patent Claims That Violated Original Patent Requirement

by: Robert Wagner, patent attorney at the Pittsburgh law firm of Picadio Sneath Miller & Norton, P.C. ()

If an inventor discovers that he or she has failed to claim all that he or she could have in an issued patent, the patent statute provides a mechanism for going back and adding additional claims during a reissue proceeding. Certain requirements must be met before the patent office will allow such a correction. As the patent holder found out in a recent decision by the Federal Circuit in Antares Pharma, Inc. v. Medac Pharma Inc. (No. 2014-1648), failure to comply with these provisions can render the new claims invalid and unenforceable.

Background

USRE44846The inventor in Antares developed an automatic injection device to self-administer pharmaceuticals that involved using a needle to puncture the skin of a patient before administering a dose of medication. All of the claims in the original patent involved a “jet injection” limitation. Almost two years after the patent issued, Antares realized that it had failed to include claims directed to safety features on the injector. Because two years had not passed yet, Antares initiated a reissue proceeding with the USPTO under 35 U.S.C. § 251, which allows a patent holder to broaden or narrow claims if initiated within two years of the patent being issued. Antares then added a number of claims to cover safety features on general injection devices, and not just jet injection devices (see No. RE 44,846).

Antares filed suit against Medac, alleging that, among other things, it infringed some of the new claims that emerged from the reissue proceeding. Antares sought a preliminary injunction, but the district court denied the request after concluding that the new claims did not satisfy the original patent requirement of the reissue statute. Antares appealed, and the Federal Circuit affirmed.

Reissue Statute Requirements

Under § 251, a patentee that wants to add new claims that broaden the scope of the claims of an already issued patent must satisfy a number of requirements: (1) the reissue application must be filed within two years of the issuance of the patent; (2) the new claims must not violate the recapture rule (i.e., claiming scope that was surrendered during prosecution); (3) the new claims must not violate the original patent requirement; and (4) no new matter may be added to the specification. At issue in this case was the third requirement—the original patent requirement.

The original patent requirement requires that the specification adequately support and fully describe the new claims. It is not sufficient if the new, broader claims are “merely suggested or indicated in the original specification.” So, hints, suggestions, or mere indications are not enough. As with many things relating to the understanding of the scope of a patent, “the essential inquiry under the ‘original patent’ clause of § 251 . . . is whether one skilled in the art, reading the specification, would identify the subject matter of the new claims as invented and disclosed by the patentees.”

The Patent at Issue

Antares’ patent specification only described the safety features being on jet injection devices and repeatedly stated that the invention related to jet injectors. It did not generically describe how to use the safety devices with other types of injectors. Based on the limited nature of the specification, the Federal Circuit agreed that the new claims were invalid because they were directed to safety features on generic injectors that were not explicitly and unequivocally disclosed in the specification.

The Federal Circuit contrasted this result with that of another case, In re Amos, 953 F.2d 613 (Fed. Cir. 1991). In the Amos case, the patentee broadened his claims that were directed towards an invention for holding down work pieces on a moving table using rollers. In the specification, the patentee described how the rollers could be raised via mechanical or electronic means, but only claimed the mechanical version. During reissue, the patentee added claims directed towards the electronic version, which the Court found acceptable because the specification explicitly discussed that embodiment.

Conclusion

The reissue statute is a powerful tool to add new claim scope to issued patents. Care must be taken, however, to file the reissue application within the two-year period and to make sure that the new claims do not add scope that is not well-supported by the specification. This decision is another reason that patent drafters need to be careful when drafting the specification. The patent statute provides some opportunities for fixing claims, but it is difficult to fix a specification if it is lacking and the consequence can be losing claim scope that could have been otherwise available with better drafting.

Federal Circuit Clarifies Limits of US Patent Law

by: Robert Wagner, patent attorney at the Pittsburgh law firm of Picadio Sneath Miller & Norton, P.C. ()

Hong Kong at nightThe United States patent laws have a territorial scope and prohibit individuals from making, using, offering for sale, and selling any patented invention within the United States without authority from the patent owner. 28 U.S.C. § 271(a). The United States is just one part of a much bigger world, and the question sometimes arises as to whether an accused infringer’s foreign activities are within the scope of the U.S. patent laws. In Halo Electronics, Inc. v Pulse Electronics, Inc., (No. 2013-1472 and -1656), the Federal Circuit had to address this issue and concluded that they were not.

Background

Halo is a supplier of electronic components and owned three patents related to surface mount electronic packages containing transformers for mounting on a printed circuit board inside an electronic device. Halo filed suit against Pulse for selling products containing electronic packages that used this technology.

Pulse designed and manufactured the accused products overseas and only sold minority of them in the United States. For its foreign orders, Pulse received purchase orders in its foreign offices and then shipped and delivered them to foreign locations.

One of Pulse’s major customers was Cisco, who incorporated some of Pulse’s products into its internet routers, which were sold all over the world. Pulse employees would sometimes meet with Cisco in the United States to negotiate prices, attend sales meetings with customers, meeting with design engineers, and provide post-sale support.

Pulse obtained summary judgment that it did not directly infringe with respect to products that were made, shipped, and delivered outside of the United States. At trial, the jury determined, among other things, that Pulse directly infringed with respect to products sold in the United States and induced infringement with respect to products that were incorporated into other products that were sold in the United States.

Halo appealed the grant of summary judgment to the Federal Circuit.

The Federal Circuit Affirms

In deciding the appeal, the Federal Circuit had to consider the geographic scope of infringement under § 271(a). The Court first looked at the statutory language and history behind § 271(a). It noted that the concept of a sale has physical and conceptual dimensions—where the buyer and seller are located and where a legally-operative act occurred regarding the sale.

It concluded that when no substantial activities occur within the United States there could be no potential liability under § 271(a):

Consistent with all of our precedent, we conclude that, when substantial activities of a sales transaction, including the final formation of a contract for sale encompassing all essential terms as well as the delivery and performance under that sales contract, occur entirely outside the United States, pricing and contracting negotiations in the United States alone do not constitute or transform those extraterritorial activities into a sale within the United States for purposes of § 271(a).

Thus, it affirmed the district court’s grant of summary judgment of no direct infringement for sales that did not occur within the United States.

It then turned to whether there could be infringement via an offer for sale. It reached the same result, finding that “[a]n offer to sell, in order to be an infringement, must be an offer contemplating sale in the United States.” Because all of these offers involved sales that occurred overseas, there could not be direct infringement.

The Federal Circuit upheld the district court’s summary judgment of no infringement with respect to the foreign sales.

Judge O’Malley’s Concurrence

Judge O’Malley concurred fully with the majority’s decision but wrote about another issue in the case. The district court found that Pulse’s infringement was not willful because it had an objectively reasonable invalidity defense. Therefore, it found that Halo could not satisfy the first prong of the Seagate test—that “a patentee must show by clear and convincing evidence that the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent.”

It did not matter that the invalidity defense was first developed during litigation. The objection prong of the test requires consideration of the totality of the evidence, including all defenses developed during the litigation and presented at trial, not just those considered by the accused infringer before being sued. The Federal Circuit affirmed this determination.

Judge O’Malley agreed with the decision but felt that it was time for the Federal Circuit to revisit its willful infringement standards in light of the Supreme Court’s decisions in Highmark Inc. v. Allcare Health Management Systems, Inc., 134 S. Ct. 1744 (2014), and Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749 (2014). She also questioned whether willful infringement should be an issue for the court or the jury. She recommended that the entire Court take up this issue en banc in order to clarify the law.

Conclusion

United States patents have geographic limitations. Companies, especially those with presences in multiple countries, need to be aware of this scope in order to make sure that they are complying with U.S. patent laws. It will also be interesting to see if the full Court takes up Judge O’Malley’s urging to reconsider the Court’s willfulness jurisprudence.