Category Archives: Patents

Court Awards Limited Enhanced Damages in CMU v. Marvell Case

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

marvell_chipYesterday, Judge Nora Barry Fischer issued her opinion in the Carnegie Mellon University v. Marvell Technology Group, Ltd. patent infringement lawsuit in the United States District Court for the Western District of Pennsylvania (Case No. 2:09-cv-00290-NBF) and awarded an additional 23% in enhanced damages above and beyond the jury’s $1.17 billion award. In total, with all enhancements and interest awards, Marvell is facing at least a $1,535,889,387.60 damage award with an ongoing $0.50/chip royalty for the lifetime of the patent.

The jury returned a $1.17 billion award in December 2012, finding that Marvell willfully infringed two of CMU’s patents (U.S. Patent Nos. 6,201,839 and 6,438,180). It awarded a royalty of $0.50 per chip Marvell sold using the patented technology. In September 2013, the Court denied Marvell’s post-trial motions and determined that Marvell’s infringement was willful. The Court yesterday determined that some enhancement of the damage award was appropriate, although not to the extent requested by CMU (who wanted an additional 200% in damages).

In weighing the parties’ arguments as to whether the damage award should be enhanced, Judge Fischer appeared to focus primarily on three factors. First, she was concerned that a double or triple award of damages could cripple Marvell. Second, she was concerned about CMU’s “inexcusable” delay for almost 6 years after learning of Marvell’s infringement before taking action. Finally, she balanced these factors against Marvell’s willful infringement and its actions before CMU filed suit.

Weighing all of these factors (and the others under the Read test), Judge Fischer concluded that a 23% enhancement properly balanced all of the relevant interests.

In this decision, Judge Fischer also awarded damages on the sales of additional infringing products that were not part of the jury’s verdict but occurred before entry of judgment (this was uncontested), established a post-judgment royalty rate of $0.50 per infringing chip sold, and set a 0.14% post-judgment interest rate. She denied CMU’s motion for a permanent injunction and for prejudgment interest, finding that neither were warranted under the circumstances.

Given the amounts at issue, one expects that these decisions will not be the final word in this case, and that at least the Federal Circuit will be looking at this case on appeal.

What Is the Difference Between a Provisional and Non-Provisional Patent Application?

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

What is the Difference Between a Provisional and Non-Provisional Patent Application?

PSMN What Is...? SeriesOne of the key decisions that an inventor needs to make in the patenting process is whether to file a provisional or non-provisional patent application, so understanding the difference between these two kinds of applications is important for inventors. Both of these types of applications serve useful roles in the patent process, but they are two very different kinds of patent applications that create very different rights.

Non-Provisional Applications

A non-provisional patent application is an application filed with the United States Patent & Trademark Office that is examined by a patent examiner and can potentially lead to the issuance of a patent. It has a number of formal requirements that must be satisfied in order to be accepted by the Patent Office. For instance, it must contain a written description of the invention with sufficient detail to both demonstrate that the inventor has invented something and to explain it in sufficient detail such that one of ordinary skill in the art could practice the invention without undue experimentation. It generally must contain formal drawings that show various embodiments of the invention. It must be accompanied by an oath or declaration by the inventor or inventors that confirms that they invented the invention described in the application. The inventors must also identify all relevant prior art that they are aware of. Finally, it must contain a series of claims, which are what defines the scope of the patent and the protections it provides.

In general, non-provisional applications are complicated documents that must be prepared with extreme care if an inventor wants a patent that will be enforceable and that will product his or her invention to the broadest extent possible. The precise language of the claims is incredibly important, as is making sure that the written description and drawings adequately explain the invention and enable one to make and use it. As such, it takes time (and money) to draft one correctly.

Provisional Applications

A provisional application, on the other hand, is never examined by a patent examiner and can never lead to the issuance of a patent by itself. Unlike a non-provisional application, there are only two requirements for filing a provisional application—it must contain a written description of the invention and sufficient drawings (which can be informal) to understand the invention. The other formal requirements of a non-provisional application (such as formal drawings, claims, oaths, declarations, and prior art disclosures) are not necessary. A provisional patent application lasts for one year before it expires, and this one-year period cannot be extended.

Because provisional applications are significantly less formal than a non-provisional application, they can be drafted more quickly (and cheaply) and can include more information than is necessary or prudent to include in a non-provisional application. Inventors can literally attach journal articles, PowerPoint slides, photographs, hand-written drawings, etc. to the application, in addition to the narrative that describes the invention.

In order for a provisional application to lead to the issuance of a patent, it must either be converted or it must be appropriately referenced in a non-provisional application that is filed within one year of the filing date of the provisional application (this one-year date cannot be extended).

So, why would one choose to file a provisional application?

So, if a provisional application only lasts for one year and cannot, by itself, ever become a patent, why would anyone want to file one? Under the current patent laws, the public sale or disclosure of an invention before a patent application (either a non-provisional or provisional application) has been filed can act as a bar that prohibits an inventor from being able to obtain a patent on the invention in the future. A provisional application provides a way for an inventor to get an application on file before a key event so as not to prevent him or her from getting a patent later on.

For example, if a company is about to present a new product at a trade show or if an inventor is about to present a paper or give a talk at a conference, the inventor can file a provisional application that contains the materials that will be publicly disclosed, along with a sufficiently detailed write-up of the invention, before that information is disclosed without having to go through the considerable time and effort required to file a non-provisional application.

In addition, in the new first-inventor-to-file regime that exists under the America Invents Act (AIA), it may be prudent for an inventor to file a series of provisional applications as it is refining and developing a new product or invention in order to protect those ideas from another inventor filing in the Patent Office first. A provisional patent application provides a quicker and cheaper means for doing so.

Conclusion

These descriptions give you some idea of the differences between provisional and non-provisional patent applications. Both types of applications serve important roles in the patenting process, and are often utilized in concert—i.e., an inventor files a provisional patent application followed by a non-provisional patent application within a year. As with all the information in our What Is…? series, there is significantly more detail and nuance behind what is described in this article. If you are interested in obtaining a patent, you should consult a patent attorney to help you determine which application is appropriate for the circumstances you find yourself in.

What Is a Patent?

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

PSMN What Is...? Series

What is a Patent?

At its most basic, a patent is a right granted by the United States government to prevent someone else from making, using, selling, offering for sale, or importing a product in the United States that uses the patented invention or process. It is a right to exclude, and not a right for the inventor to make, use, sell, offer for sale, or import the product himself or herself. This is an important distinction that is often overlooked by inventors who may think that getting a patent entitles them to use their own invention.

The right to a patent is actually enshrined in the Constitution, and is found in Article I, Section 8, Clause 8, which states:

The Congress shall have Power To…promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries….

In order to obtain a patent, an inventor must apply to the United States Patent and Trademark Office (USPTO) in Alexandria, Virginia. The USPTO is responsible for examining all patent applications and determining whether an invention qualifies for a patent. In general, an invention must be new, novel, and useful to potentially qualify. If the USPTO determines that the invention qualifies for a patent, it issues the patent and publishes it in a public registry of all patents. The USPTO has issued more than 9.3 million utility, design, and plant patents since the first utility patent was issued back in 1790.

If you look at a patent (it is a document), you will see that it has a number of major parts. The front page contains information about the patent, including its number, when it was filed and issued, who the inventor is, related patents, what other patents and prior art were looked at before issuing the patent, and what attorney or law firm helped draft the patent, among many other things. There is also a brief summary (the abstract) that describes the invention. The next pages contain drawings that help describe the invention. Later pages include background information about the invention, as well as a detailed description of it. Finally, the patent ends with a series of numbered claims. Each claim is a single sentence that describes the legal boundaries of the invention. The claims are the most important part of the patent.

Patents generally last for 20 years from the date of the earliest non-provisional application filed by the inventor. This duration can be longer or shorter depending on various circumstances, including how long the patent office takes to examine the patent application and whether the inventor has other, related applications.

Once a patent expires, the invention is in the public domain, and anyone can use it without permission from the inventor. This is the tradeoff that comes from being given a period of time in which the inventor can exclude others from using the invention.

Again, this description provides a broad overview of what a patent is, and there is a lot more detail behind each of these concepts. In our upcoming articles in our What Is…? series, we will explore some of the concepts discussed in this post in greater depth, explaining about the different kinds of patents (utility, design, and plant), the different types of applications (non-provisional, provisional, PCT, continuations, continuations in part, and divisionals), the different types of claims (independent and dependent) and what kinds of inventions can be patented, among many other things. We hope you’ll join us.

USPTO Posts Questionable Advice for People Who Receive Demand Letters

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

Last week, the US Patent and Trademark Office expanded its website to include a section to help individuals and companies to respond when receiving demand letters from patent holders. As one of our colleagues, Gene Quinn, over at IPWatchdog.com notes, this resource (albeit in “Beta” form) is fairly one-sided and offers some problematic advice to those who receive demand letters.USPTO

Much of the advice on the USPTO’s website is fairly generic, but the overall tenor of the advice seems to ignore that legitimate patent owners with legitimate and valid patents often send these demand letters to stop individuals and companies from infringing their patents. Indeed, that is one of the fundamental rights that comes with owning a patent—the ability to stop others from using your invention.

Instead, the fundamental assumption on the USPTO’s website seems to be that only patent trolls send demand letters. For instance, the USPTO suggests that one response is to simply ignore a demand letter because some patent owners send these demand letters to mislead or intimidate the recipients into paying for licenses that they do not need. While the USPTO notes that this approach carries some risk, that advice is buried at the end. Oddly, the USPTO never suggests that one option after receiving a demand letter is to simply stop infringing the patent.

The USPTO also downplays the importance of consulting with an attorney to help understand the risks and to respond to the patent owner in an appropriate manner. Patent law is not a simple subject, and most individuals simply do not have the expertise or knowledge to determine whether they are infringing, whether the patent is valid and enforceable, and what the risks may actually be.

In my years of practice, I have noticed that many individuals do not understand what the scope of a patent is unless they have significant prior experience with patents. They tend to look at the description of the invention in the specification or the drawings, rather than the claims, when trying to assess their exposure. As patent practitioners know, it is the claims that truly matter (although the specification is important to understanding those claims), and those claims are often far broader then the particular embodiments disclosed in the specification. In addition, claims are not written in a format that is simple to understand or there are statements made during the prosecution of the patent that are important to understanding their scope, which compounds the problem. Thus, there is a very real risk that individuals will drastically underestimate the risk that they infringe unless they receives competent legal advice.

While hiring an attorney may be an expensive proposition, the consequences of not doing so may be far greater. A typical patent infringement lawsuit can easily cost more than $500,000 to defend, even where the amount at issue is small (and can cost tens of millions of dollars when significant amounts are at issue). And, once a lawsuit begins, it can be very hard for a defendant to unilaterally stop it. If an individual is truly infringing, an attorney can help the client understand the risks and suggest ways of resolving the matter before litigation begins, which potentially can save an individual hundreds of thousands of dollars. Simply ignoring a demand letter can be the last thing an accused infringer should do unless there is a very good reason for doing so because ignoring the demand letter starts to lay the groundwork for a finding of willful infringement, which potentially entitles the patent owner to triple damages and an award of its attorneys’ fees and costs.

The problem of extortionate patent trolls is very real, and I have represented numerous companies that have been the targets of these kinds of trolls. It is extremely frustrating to explain to a client the financial costs and distractions that come with defending a meritless lawsuit brought by patent troll and the fact that there often is no simple way to make the lawsuit disappear without paying some amount of money to the troll. That being said, I’ve also represented legitimate companies with patents on innovations they developed that help give them a competitive edge in the marketplace. They have spent significant time and resources in developing these innovations and bringing them to market and understandably want to protect those investments. The USPTO’s blanket advice to individuals and companies that might receive a demand letter is not particularly helpful and understates the real risks and costs that are at issue. It is somewhat disturbing that an office that is charged with issuing valid patents and supporting innovation would put out such incomplete and unbalanced advice. Hopefully, the USPTO will present more balanced and useful advice when this website moves out of its “beta” stage.

Busy IP Docket for US Supreme Court Upcoming

Sneath, Henry 2012 headshotBy: Henry Sneath, Chair of the Intellectual Property practice at Picadio Sneath Miller & Norton, P.C.  hsneath@psmn.com or 412-288-4013

The US Supreme Court has a very busy IP docket in the next few months. Close watchers of the court predict a continuing focus on IP cases. Our friends at AIPLA provide a nice summary of the oral argument schedule of IP cases through April. We will follow these cases and post any important decisions. See AIPLA link below: http://www.aipla.org/resources2/reports/2014/Pages/140214AIPLA-Direct.aspx

Supreme Court Holds That Patentee Bears Burden of Persuasion on Infringement When Licensee Seeks a Declaratory Judgment

By: Joe Carnicella, intellectual property attorney with Picadio Sneath Miller & Norton, P.C.

We posted about this case in May 2013, and on January 22, 2014, the Supreme Court decided this matter.

First, the Supreme Court held that the Federal Circuit did not lack subject-matter jurisdiction.  Because federal courts determining declaratory judgment jurisdiction often look to the “character” of the declaratory judgment defendant’s “threatened action,” which in this case, the threatened hypothetical action would constitute the licensor terminating a license and bringing suit for infringement under federal patent laws, the declaratory judgment action would arise under federal patent laws.

Second, the Supreme Court held that when a licensee seeks a declaratory judgment against a patentee that its products do not infringe the licensed patent, the patentee bears the burden of persuasion on the issue of infringement.  The Supreme Court based this ruling on three settled legal propositions: (1) a patentee ordinarily bears the burden of proving infringement; (2) the operation of the Declaratory Judgment Act is only procedural leaving substantive rights unchanged; and (3) the burden of proof is a substantive aspect of a claim.

By way of background, the United States Supreme Court granted cert. to hear argument on whether, in a declaratory judgment action brought by a licensee, the licensee has the burden to prove that its products do not infringe the patent, or whether the patentee must prove infringement.  Medtronic Inc. (licensee) licensed a patent from Mirowski Family Ventures LLC (patentee / licensor) relating to a device used to stop imminent heart failure.  Medtronic subsequently created new products and then filed a declaratory judgment action claiming that its new products do not infringe the patent.  The Federal Circuit Court of Appeals held that Medtronic bears the burden of proving that its products do not infringe Mirowski’s patent.  Medtronic argued that the U.S. Supreme Court should overturn the Federal Circuit’s ruling, which Medtronic argued is inconsistent with the Supreme Court’s decision in MedImmune, Inc. v. Genetech, Inc., 549 U.S. 118 (2007).  In MedImmune, the Supreme Court ruled that a patent licensee that believes that its products do not infringe the patent is “not required . . . to break or terminate its . . . license agreement before seeking a declaratory judgment in federal court that the underlying patent is . . . not infringed.”  According to Medtronic, the Federal Circuit’s opinion undercut the MedImmune decision because it caused a licensee to take on the significant burden and cost of a presumption that its products infringe.  In turn, Mirowski argued that this case is distinguishable from MedImmune because the licensing agreement at issue specifically required Medtronic to file a declaratory judgment action if a dispute arose.  Mirowski submitted that the Federal Circuit correctly decided that, based specifically on the contract terms between the parties, Medtronic should bear the burden of proving that it should be let out of the contract for the new products.

Significant Interest in Alice Corp. v. CLS Bank Int’l Case at Supreme Court

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

SupremeCourtImage_1The Supreme Court granted certiorari in Alice Corp. Pty. Ltd. v. CLS Bank International, (No. 13-298), to address the boundaries of what constitutes patent eligible subject matter under 35 U.S.C. § 101 and, more specifically, whether and to what extent software is patent eligible. We’ve been following this case since it was at the Federal Circuit (see our prior post here) and noted the chaos that emerged from the Federal Circuit’s en banc decision that could not decide on the proper standards for software patent eligibility.

Since Alice Corp. filed its petition for a writ of certiorari, 34 amicus briefs have been filed, indicating the importance of this case to the patent community. (To read the briefs, click here). The briefs have been circulated to the justices, and oral argument is scheduled for March 31, 2014.

As numerous commentator’s have pointed out (see, e.g., here), software has been patent-eligible subject matter for almost 50 years and accounts for a significant number of granted patents. A decision by the Supreme Court that software is not patent eligible would have huge repercussions throughout the patent and software worlds. We will be monitoring the case and will report on the oral argument, once it occurs.

Pennsylvania Senate to Consider Patent Troll Bill

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

In the continuing quest to limit or prevent patent “trolls” from filing frivolous lawsuits against alleged infringers, state legislatures are jumping into the mix and proposing state laws to discourage or prohibit this kind of conduct. Pennsylvania is among the latest to join this bandwagon. PA Senate Bill No. 1222, introduced on February 4, 2014 is an effort to limit and discourage frivolous patent infringement lawsuits. However, given the scope of the bill, and the potential conflicts with federal law, there are serious questions as to both the wisdom of the approach it takes and whether this bill will ever become law.

The Language of the Bill

Bill No. 1222 purports to prohibit bad faith assertions of patent infringement. (Section 3(a)). It allows a target of a demand letter, someone threatened with patent infringement, or a defendant in a patent infringement lawsuit to bring an action in state court (the court of common pleas) for bad faith. (Section 5(b)). If the court determines that there is a reasonable likelihood that the patentee has threatened or is litigating a patent infringement claim in bad faith, the court can require the patentee to post a bond to cover the target’s legal costs and damages, but not to exceed $250,000. (Section 4). In addition, among the possible remedies are equitable relief, damages, costs and fees, and exemplary damages of $50,000 or three times the total damages, costs, and fees, whichever is greater. (Section 5(b)).

Under the bill, the following factors may be considered as evidence that a patentee is bringing a bad faith claim of patent infringement (Section 3(b)):

  • When a demand letter fails to contain the patent number, the identity of the patent owner, or factual allegations of why the target infringes.
  • When the patentee conducted adequate due diligence before sending the demand letter.
  • When the patentee refuses to provide certain information to the target when requested to do so.
  • When the demand letter demands a response or payment within an unreasonably short period of time.
  • When the license demand is not reasonably related to what the license should be worth.
  • When the patentee knew the claim was meritless or deceptive.
  • When the patentee previously filed or threatened similar actions that were meritless or failed to disclose the kinds of information identified above.

In contrast, the following factors may be considered as evidence that the patentee is not bringing a bad faith claim of patent infringement (Section 3(c)):

  • When a demand letter includes the patent number, the identity of the patent owner, and factual allegations of why the target infringes, or the patentee provides this information on request.
  • When the patentee engages in a good faith effort to establish infringement and negotiate an appropriate remedy.
  • When the patentee has made a substantial investment in using the patent or selling products that use the patent.
  • When the patentee is the inventor, joint inventor, original assignee, or an institution of higher education (or its tech transfer office).
  • When the patentee has demonstrated successfully enforced the patent in litigation or has in good faith previously tried to enforce the patent.

Thoughts About the Merit of This Bill

Determinations of whether a patent infringement claim has been brought in good or bad faith will necessarily require a significant analysis of the underlying merits of the claim, including claim construction and the intricacies of infringement and invalidity issues. State courts have never had to deal with these issues before because federal courts have exclusive jurisdiction under 28 U.S.C. § 1338(a) to hear all patent cases. Thus, this bill would place state courts in uncharted and complex waters that they have never had to deal with.

In addition, this bill purports to extend not just to demand letters sent by patentees, but also filed patent infringement lawsuits (which must be in federal court). It is unclear how state courts are to be addressing issues being litigated in federal court and what power a state court has to interfere with those parallel proceedings. One would think that a federal court that is handling the lawsuit is in a far better position to assess the good or bad faith of a patentee’s claims.

While it is a laudable goal to create disincentives to filing frivolous lawsuits, this bill seems particularly ill suited to this goal. We will be following this bill as it progresses, and will report on its progress.

Penn State Sues Samsung for Patent Infringement by Galaxy Smartphones

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

psu_logoIt’s not just Apple that is suing Samsung in the smart phone arena. Last Friday, the Penn State Research Foundation (the technology transfer office for Penn State) sued Samsung in the United States District Court for the Middle District of Pennsylvania, Case No. 4:14-cv-00124, for allegedly infringing the Foundation’s US Patent No. 6,720,572, entitled “Organic Light Emitters with Improved Carrier Injection.”

Galaxy S4In the complaint, the Foundation contends that at least Samsung’s Galaxy SIII and Galaxy S4 products infringe the ‘572 Patent. The Foundation also contends that Samsung willfully infringed the ‘572 Patent because it knew of the patent at least as early as May 12, 2010, when it was referenced by the USPTO in a office action involving one of Samsung’s patent applications.

The ‘572 Patent relates to:

A light emitting device with improved carrier injection. The device has a layer of organic light emitting material and a layer of organic semiconductor material that are interposed between first and second contact layers. A carrier transport layer, may optionally be included between the semiconductor and light emitting layers. When used as a diode, the first and second contacts are functionally the anode and cathode. The device can also be a field effect transistor device by adding a gate contact and a gate dielectric. The first and second contacts then additionally have the function of source and drain, depending on whether the organic semiconductor material is a p-type or an n-type. Preferably, the organic semiconductor is formed with pentacene.

As the case was just filed, there has been little activity in it. We will monitor this case as it progresses.

Federal Circuit Grants Additional Time to Term of Patent from Continued Examination

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

USPTOIn an opinion issued Novartis AG v. Lee (No. 2013-1160, -1179) yesterday, the Federal Circuit clarified the standards for how much additional time the USPTO should add to the term of an issued patent under 35 U.S.C. § 154(b) when a patentee requests a continued examination.

When Congress changed the effective term of a patent from 17 years after issuance to 20 years after filing, it provided that extensions would be granted in certain circumstances where the delay in issuing the patent was due to the USPTO’s actions or inactions. The rules governing this extension are set forth in 35 U.S.C. § 154. In general, the term of a patent will be extended by one day for each day after three years of examination (subject to some exclusions), or when there are delays due to an interference, secrecy order, or successful appeal.

At issue in this appeal was the proper application of the provisions of 35 U.S.C. § 154(b)(1)(B)(i), which exclude “any time consumed by continued examination of the application requested by the applicant under section 132(b).” With respect to two patents, Novartis requested continue examination under § 132(b). The USPTO Director refused to grant any extensions for the time from the request until issuance of the patents.

Novartis first argued that § 154(b)(1)(B)(i) does not apply if the request for continued examination occurs more than three years after the filing of the application. The Federal Circuit rejected this argument because the purpose of the statute and the other aspects of the statutory structure did not support it. The Court did acknowledge that the language was unclear, but ultimately concluded that Novartis’s position was incorrect.

Novartis next argued that the § 154(b)(1)(B)(i) exclusion only applies to the time from the request to the notice of allowance (not to the date of issuance). The Federal Circuit agreed. The allowance to issuance time period is not related to the continued examination and involves time spent in the office of publication, not with the examiner. The Court felt it inappropriate to not credit the patentee with any delays caused during that part of the process. To the extent that there are any unusual delays relating to the examination after allowance, the USPTO can make appropriate adjustments where appropriate.

While this decision is not likely to affect many patents, practitioners should be aware of this change in these circumstances to make sure that the USPTO is properly calculating any extensions that are due to the patentee.