Following the Rules is Not Enough (Check the Statutes)

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In Mondis Technology Ltd. v. LG Electronics Inc., [2020-1812] (August 3, 2021), the Federal Circuit dismissed LG’s appeal from a jury verdict that it infringed U.S. Patent No. 7,475,180, directed to a display unit configured to receive video signals from an external video source .

The jury found that the accused LG televisions infringed claims 14 and 15 of the ’180 patent, that the claims were not invalid, and that LG’s infringement was willful, and awarded plaintiffs $45 million in damages. Following the jury verdict, LG filed several post-trial motions including: (1) a motion for JMOL or new trial of non-infringement, (2) a motion for JMOL or new trial of invalidity, and (3) a motion for JMOL, new trial, or remittitur regarding the damages award and willfulness finding.

On September 24, 2019, the district court denied LG’s motions regarding infringement, invalidity, and willfulness but ordered further briefing on damages. On April 22, 2020, the district court granted LG’s motion for a new trial on damages. Less than 30 days later, on on May 8, 2020, LG filed notice of interlocutory ppeal challenging the district court’s decision denying LG’s post-trial motions regarding infringement, invalidity, and willfulness (all of which were decided in the September 24 Order).

The problem for LG is that its interlocutory appeal is governed by 28 U.S.C. § 1292(c)(2), which provides the Federal Circuit with exclusive jurisdiction over “an appeal from a judgment in a civil action for patent infringement which would otherwise be appealable to the United States Court of Appeals for the Federal Circuit and is final except for an accounting.” 28 U.S.C. § 2107(a) sets the time for appeal as “within thirty days after the entry of such judgment, order or decree.” Under § 1292(c)(2), a judgment is final except for an accounting when all liability issues have been resolved, and only a determination of damages remains.

The September 24 Order resolved all issues of liability, so the appeal was due by October 24, and thus the May 2020 filing was more than six months late, and thus the Federal Circuit had no jurisdiction to consider the appeal.

LG argued that FRAP 4(a)(4) instructs that, if a party timely files any of several enumerated motions, including post-trial motions for judgment under FRCP 50(b) or for a new trial under FRCP 59, “the time to file an appeal runs for all parties from the entry
of the order disposing of the last such remaining motion.”

The Federal Circuit noted that LG’s timeliness arguments focus on the Federal Rules,
rather than the statutory requirements for jurisdiction, observing that the Rules cannot override federal statute, and to the extent that there is any conflict between the Rules and federal statutes, the statutes must prevail.

However, not all is lost for LG. While its interlocutory appeal was dismissed, LG is not precluded from from challenging the liability determinations of the district court under our § 1295 jurisdiction once the damages determination is completed.

I will Gladly Assign to You Today, an Invention I will Make Tomorrow

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In Omni Medsci, Inc. v. Apple, Inc., [2020-1715, 2020-1716] (August 2, 2021), the Federal Circuit affirmed the district court’s holding that the University of Michigan bylaws did not effectuate a present automatic assignment of Dr. Islam’s patent rights and therefore affirm the district court’s denial of Apple’s motion to dismiss on the ground that Omni, Dr. Islam’s assignee, had standing.

The University of Michigan’s by laws provide that:

Patents and copyrights issued or acquired as a result of or in connection with administration, research, or other educational activities conducted by members of the University staff and supported directly or indirectly (e.g., through the use of University resources or facilities) by funds administered by the University regardless of the source of such funds, and all royalties or other revenues derived therefrom shall be the property of the University.

Slip Op. 2-3.

If this language worked an immediate assignment of rights, then Dr. Islam’s assignment to Omni was a nullity, and Omni lacked standing, as Apple contended. The majority reviewed this language and agreed with the district court that it did not presently automatically assign
Dr. Islam’s rights to the patent but rather, at most, “reflects a future agreement to assign rather than a present assignment.” This conclusion was supported by a comparison of the language with Federal Circuit precedent; the fact tht the same language was used in other parts of the document that could not possibly be considered to be a present assignment; the fact that the language did not use “present tense words of execution;” and the fact the language was different than assignment language used by the University in other forms.

Judge Newman dissented, finding that the language in the by laws was an assignment, which meant the assignment to Omni was ineffective, and thus Omni lacked standing.

Regardless of whether you side agree the majority or with Judge Newman, both sides continue to accept without question that it is possible to make a present assignment of something that does not exist. It would foolish not to recognize that this is the law, and to use clear language of present assignment in employee agreements. However it is equally foolish not to get a confirmatory assignment once something is actually invented.

PTAB Departure from Agreed Claim Construction Required Notice and Opportunity to be Heard

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In Qualcomm Inc. v. Intel Corp., [2020-1589, 2020-1590, 2020-1591, 2020-1592, 2020-1593,
2020-1594] (July 27, 2021), the Federal Circuit vacated and remanded six inter partes review final written decisions determining that claims 1–15, 17–25, and 27–33 of U.S. Patent
No. 9,608,675 would have been obvious.

The ’675 patent relates to techniques for generating a power tracking supply voltage for a circuit that processes multiple radio frequency signals simultaneously, using one power amplifier and one power tracking supply generator. During the IPR’s the parties never disputed that the signals were required to increase user bandwidth, and in the International Trade Commission, the Commission’s construction of the term also included the increased
bandwidth requirement.

The Board issued six final written decisions concluding that all challenged claims were unpatentable. In reaching its conclusion, the Board construed the term “a plurality of carrier aggregated transmit signals” in each asserted claim to mean “signals for transmission on multiple carriers,” omitting any requirement that the signals increase or extend bandwidth.

Qualcomm argued that it was not afforded notice of, or an adequate opportunity to respond to, the Board’s construction of “a plurality of carrier aggregated transmit signals,” and the Federal Circuit agreed. The Federal Circuit began by noting that “[a] patent owner in [an IPR] is undoubtedly entitled to notice of and a fair opportunity to meet the grounds of rejection,”
based on due process and Administrative Procedure Act (APA) guarantees.

The Board may adopt a claim construction of a disputed term that neither party proposes
without running afoul of the APA. Parties are well aware that the Board may stray from disputed, proposed constructions, however, but in the instant case the issue of whether increased bandwidth was a required part of the claim construction was not in dispute. The Federal Circuit noted that the patent owner owner agreed with the increased bandwidth requirement proposed by the petitioner. While the Board did not change theories midstream or depart from a construction it previously adopted, it is still difficult to imagine either party anticipating that this agreed-upon matter of claim construction was a moving target. The Federal Circuit said that unlike with disputed terms, it is unreasonable to expect parties to brief or argue agreed-upon matters of claim construction. Thus the Federal Circuit found that in the
the circumstances of this case, the Board needed to provide notice of, and an adequate opportunity to respond to, its construction. The Federal Circuit further found that Qualcomm did not receive notice or an opportunity to be heard regarding the Board’s construction that departed from the agreed-upon increased bandwidth requirement, and thus, the Board violated Qualcomm’s procedural rights under the APA.

It is not Obvious to Ignore the Teachings of the Prior Art

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In Chemours Company FC, LLC v. Daikin Industries, LTD., [2020-1289, 2020-1290] (July 22, 2021), the Federal Circuit concluded that the Board’s decision on obviousness is not supported by substantial evidence and that the Board erred in its analysis of objective indicia of nonobviousness, and reversed.

U.S. Patent No. 7,122,609 relates to a unique polymer for insulating communication cables formed by pulling wires through melted polymer to coat and insulate the wires, a process
known as “extrusion.”

Chemours argues that the Board’s final written decision on obviousness is erroneous because its factual findings on motivation to combine were unsupported by substantial evidence, and specifically that Daikin did not meet its burden of proof because it failed to show that a person of ordinary skill in the art would modify the polymer of the prior art reference to achieve the claimed invention. However the reference also taught that a narrow distribution of molecular weights was important, while the claimed invention did not use the narrow distribution of molecular weights.

The Federal CIrcuit found that Board’s obviousness findings are not supported by substantial evidence. The Federal Circuit said the Board appears to have ignored the express disclosure in the reference that teaches away from the claimed invention and relied on teachings from other references that were not concerned with the particular problems the reference sought to solve. More specifically, the Board did not explain why one would be motivated to increase the melt flow rate to the claimed range, when doing so would necessarily involve altering the inventive concept of a narrow molecular weight distribution polymer. The Federal Circuit cited Trivascular, Inc. v. Samuels, 812 F.3d 1056, 1068 (Fed. Cir. 2016) where it found no motivation to modify the prior art where doing so “would destroy the basic objective” of the prior art).

The Federal Circuit found that this was particularly true in light of the fact that the reference appears to teach away from broadening molecular weight distribution and the known methods for increasing melt flow rate. The Federal Circuit said that the Board relied on an inadequate evidentiary basis and failed to articulate a satisfactory explanation that is based on substantial evidence for why one would have been motivated to modify the reference.

The Federal Circuit also agreed that the Board erred in its analysis of objective indicia. The Board found no nexus between the claimed invention and the alleged commercial success because all the features were disclosed in the prior art. The Federal Circuit instructed that contrary to the Board’s decision, the separate disclosure of individual limitations, where the invention is a unique combination of three interdependent properties, does not negate a nexus, explaining that concluding otherwise would mean that nexus could never exist where the claimed invention is a unique combination of known elements from the prior art.

The Federal Circuit also agreed that the Board erred in its demand that market share evidence is necessary to sustain a finding of commercial success. Chemours contended that sales data
alone should be enough for commercial success, and the Federal Circuit agreed. The Federal Circuit said that market share data, though potentially useful, is not required to show commercial success. While the Board was entitled to weigh evidence and find, if appropriate, that Chemours’s gross sales data were insufficient to show commercial success without market
share data, the Board, erred in its analysis that gross sales figures, absent market share data, “are inadequate to establish commercial success.”

Lastly, the Federal Circuit agreed that the Board erred when it found that the patents in suit were blocking patents. A blocking patent is an earlier patent that prevents practice of a later invention—the invention of the patent-in-dispute. The Board concluded that the evidence proffered to establish commercial success was weak because the patent-in-suit blocked others
from entering the market. The Federal Circuit said that the challenged patent, which covers the claimed invention at issue, cannot act as a blocking patent.

A Patent Infringement Complaint Simply Must State a Plausible Claim to Relief

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In Bot M8 LLC v. Sony Corporation of America, [2020-2218] (July 13, 2021), the Federal Circuit found no error in the district court’s “directing” Bot M8 to file a first amended complaint, or in dismissing Bot M8’s claims of infringement of U.S. Patent Nos. 8,078,540 and 8,095,990 for failure to state a plausible claim of infringement. However, the Federal Circuit held that the district court erred in finding Bot M8’s allegations as to U.S. Patent Nos. 7,664,988 and 8,112,670 were insufficient. The Federal Circuit found that the district court acted within its discretion in denying Bot M8’s motion to file a second amended complaint, as well as the subsequent order denying leave to move for reconsideration. Finally the Federal Circuit affirmed the granting summary judgment as to the invalidity of the U.S. Patent No. 7,338,363 under 35 USC 101. The asserted patents all relate to gaming machines and are directed to casino, arcade, and video games generally.

To survive a motion to dismiss under Rule 12(b)(6), the Federal Circuit said a complaint must “contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face. The district court instructed counsel for Bot M8 that it must explain in the complaint every element of every claim that you say is infringed and/or explain why it can’t be done. The Federal Circuit disagreed with the district court’s approach and reiterate that a plaintiff need not ‘prove its case at the pleading stage. The Federal Circuit said a plaintiff is not required to plead infringement on an element-by-element basis. Instead, it is enough that a complaint place the alleged infringer on notice of what activity is being accused of infringement.

The relevant inquiry under Iqbal/Twombly is whether the factual allegations in the complaint are sufficient to show that the plaintiff has a plausible claim for relief. The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully. In other words, a plausible claim must do more than merely allege entitlement to relief; it must support the grounds for that entitlement with sufficient factual content.

The Federal Circuit agreed with the district court that Bot M8’s allegations as to the ’540 and ’990 patents were conclusory and at times contradictory, but found that the court erred in dismissing the allegations as to the ’988 and ’670 patents. With respect to the ’988 and ’670 patents, the court simply required too much.

With respect to the ‘363 Patent, and Federal Circuit agreed that the claims recite the abstract idea of increasing or decreasing the risk-to-reward ratio, or more broadly the difficulty, of a multiplayer game based upon previous aggregate results. The Federal Circuit further found that the claims leave open how to accomplish this, and the specification provides hardly any more direction. The district court said, and the Federal CIrcuit further found that the claim merely recites result-oriented uses of conventional computer devices and that, at bottom, nei-ther the patent specification, patent owner, or patent owner’s experts articulate a technological problem solved by the ’363 patent.” After careful consideration, the Federal Circuit discerned no error in the district court’s § 101 analysis, and found no need to discuss that analysis in any detail.

Father’s Day 2021

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America’s ingenuity for celebrating is well documented in the U.S. patent collection, and technology for celebrating our Fathers is not an exception.

Take, for instance, the Expectant Father System patented by Ashley Svopa on June 1, 1999 as U.S. Patent No. 5,908,108:

Then there’s literally a Father Figure in U.S. Patent No. D803720, patented by Eytan and Irina Silboni on November 28, 2017:

Juneteenth

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Congress has passed, and President Biden has now signed, legislation making June 19th — Juneteenth — a national holiday. June 19th is the anniversary of the June 19, 1865, announcement of General Order No. 3 by Union Army general Gordon Granger, proclaiming freedom from slavery in Texas. President Lincoln’s January 1, 1863, Emancipation Proclamation officially outlawed slavery in the rebelling states, but enforcement in remote Texas was spotty at best. Ironically, after June 19th 1865, slavery remained legal in two Union states – Delaware and Kentucky – for another six months until the December 6, 1865, ratification of the Thirteenth Amendment to the Constitution abolished slavery nationwide.

Only one U.S. patent to date references Juneteenth — Ivy Antrinette Marlonia’s U.S. Patent No. 8,136,962, on Remote Controlled Hideaway Holiday and Party Lighting. According to Ivy, her party lighting can be used to celebrate a number of occasions, including Juneteenth:

Flag Day 2021

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June 14th is Flag Day, the anniversary of the adoption of the flag of the United States on June 14, 1777, by resolution of the Second Continental Congress. President Woodrow Wilson issued a proclamation that officially established June 14 as Flag Day in 1916, and on August 3, 1949, Congress established June 14 as National Flag Day, although it was not made an official federal holiday. The U.S. patent collection provides a number of suggestions of ways to display your flag:

U.S. Patent No. 1,571,581, issued February 2, 1926 discloses a Holder for Flags or the Like
U.S. Patent No. 1,374,921, issued April 19, 1921, disc;loses a Mechanically Waved Flag
U.S. Patent No. 696597, issued April 8, 1902, discloses a Flag Cane.
U.S> Patent No. D22035, issued December 6, 1892, discloses a Handle for Spoon with a flag motif.

However you decide to display the flag today, have a great day.

The Specification may be Eligible; But the Claims Were Not

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In Free Stream Media Corp., dba Samba TV v. Alphonso Inc., [2019-1506, 2019-2133] (May 11, 2021) the Federal Circuit reversed the denial of Alphonso Inc.’s motion to dismiss on the ground that U.S. Patent No. 9,386,356 claims ineligible subject matter under 35 U.S.C. §101.  The ’356 patent is entitled “Targeting with Television Audience Data Across Multiple Screens.”

The district court rejected the argument that the claims were directed to an abstract idea of tailored advertising as argued by Alphonso, but the Federal Circuit agreed with Alonso, finding that the claims were directed to (1) gathering information about television users’ viewing habits; (2) matching the information with other content (i.e., targeted advertisements) based on relevancy to the television viewer; and (3) sending that content to a second device.

The Federal Circuit said that a relevant inquiry at Alice Step 1 is whether the claims in the patent focus on a specific means or method that improves the relevant technology or are instead directed to a result or effect that itself is the abstract idea and merely invoke generic processes and machinery.  A claim must have the specificity required to transform the claim from one claiming only a result to one claiming a way of achieving it to avoid ineligibility. As a result, a claim is ineligible if it fails to recite a practical way of applying an underlying idea and instead is drafted in such a result-oriented way that it amounts to encompassing the principle in the abstract no matter how implemented.

The Federal Circuit noted that Samba asserted that its invention allows devices on the same network to communicate where such devices were previously unable to do so. However, the Federal Circuit noted that the asserted claims provide for how that is achieved only by stating that the mechanism used to achieve this communication is by piercing or otherwise overcoming a mobile device’s security sandbox. But the asserted claims do not at all describe how that result is achieved.

The Federal Circuit said that even assuming the specification sufficiently discloses how the sandbox is overcome, the asserted claims nonetheless do not.

There is nothing in the claims that demonstrates an improvement to computer functionality, and even assuming, as Samba argues, that the claimed advance is in the ability to pierce the sandbox of a mobile device, Samba has not demonstrated that this is something more than a mere use of a computer as a tool.  Therefore, the alleged technological improvement does nothing more than implement a computer to achieve the abstract idea of providing targeted advertising to the mobile device user.

The district court did not reach Alice Step 2, because it did not find the claims were directed to an abstract idea.  The Federal Circuit determined that the claims simply recite the use of generic features, as well as routine functions, to implement the underlying idea.  The claims here simply recite that the abstract idea will be implemented using conventional components and functions generic to the technology.

Picture This: An Improved Camera is a Abstract Idea

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In Yu v. Apple, Inc., [2020-1760, 2020-1803] (June 11, 2021), the Federal Circuit affirmed the district court dismissal pursuant to FRCP Rule 12(b)(6) on the grounds that the asserted claims of U.S. Patent No. 6, 611,289, on Digital Cameras Using Multiple Sensors with Multiple Lenses, were invalid under 35 U.S.C. § 101.

The district court held that the asserted claims were directed to “the abstract idea of taking two pictures and using those pictures to enhance each other in some way. The district court further concluded that the asserted claims lack an inventive concept, noting the complete absence of any facts showing that the claimed elements were not well-known, routine, and conventional.”

The Federal Circuit concluded that given the claim language and the specification, that claim 1 is “directed to a result or effect that itself is the abstract idea and merely invoke[s] generic processes and machinery” rather than “a specific means or method that improves the relevant technology.” The Federal Circuit further observed that “[o]nly conventional camera components are recited to effectuate the resulting “enhanced” image—two image sensors, two lenses, an analog-to-digital converting circuitry, an image memory, and a digital image processor. These conventional components perform only their basic functions and are set forth at a high degree of generality.

The Federal Circuit, perhaps unfairly used the patent drafter’s words to seal the fate of the claims, noting that the specification identified a “great need for a generic solution that makes digital cameras capable of producing high resolution images without [high] cost,” and concluding that “[w]hat is claimed is simply a generic environment in which to carry out the abstract idea.

The Federal Circuit also dispatched the concern that the claim was to an improved machine, noting in a footnote that “whether a device is ‘a tangible system (in § 101 terms, a “machine”)’ is not dispositive. See Alice, 573 U.S. at 224; In re TLI Commc’ns, 823 F.3d at 611 (‘[N]ot every claim that recites concrete, tangible components escapes the reach of the abstract-idea inquiry.’). As discussed herein, the focus of claim 1 is the abstract idea.”

The Federal Circuit also noted the disparity between the broad scope of the claim, and the particular configuration described in the specfication:

In these circumstances, the mismatch between the specification statements that Yu points to and the breadth of claim 1 underscores that the focus of the claimed advance is the abstract idea and not the particular configuration discussed in the specification that allegedly departs from the prior art.

At step two, the Federal Circuit concluded that claim 1 does not include an inventive concept sufficient to transform the claimed abstract idea into a patent-eligible invention, because claim 1 is recited at a high level of generality and merely invokes well-understood, routine, conventional components to apply the abstract idea identified above. The Federal Circuit rejected Yu’s argument about the unconventional architecture, saying that even if claim 1 recites novel subject matter, that fact is insufficient by itself to confer eligibility.

The Federal Circuit affirmed the judgment of the district court.

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