Licensee’s Failure to Mark Licensed Products Limits Patent Owner’s Recovery

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In Arctic Cat inc. v. Bombardier Recreational Products Inc., [2019-1080] (February 19, 2020), the Federal Circuit affirmed the district court’s determination that the patent owner was not able to recover pre-suit damages for infringement of U.S. Patent U.S. Patent Nos. 6,793,545 and 6,568,969 because the licensee did not mark covered products with the patent number.

On a previous appeal, the Federal Circuit held that once an alleged infringer identifies products that it believes are unmarked patented articles subject to the notice requirements of § 287, the patentee bears the burden of proving that the identified products do not practice the claimed invention.

On remand, Arctic Cat conceded that it could not show that the licensee’s products did not practice the asserted claims, but nonetheless moved for summary judgment that it is entitled to presuit damages because the damages limitations §287 only apply while the patentee is active making, using, and selling unmaked products, and not to the period when its licensee has ceased selling the accused products. Arctic Cat also argued that the jury’s finding of willful infringement is sufficient to demonstrate actual notice under § 287.

As to Arctic Cat’s first argument, the Federal Circuit held that the cessation of sales of unmarked products does not excuse noncompliance with the notice requirement of § 287 such that a patentee may recover damages for the period after sales of unmarked products ceased but before the filing of a suit for infringement.

The Federal Circuit noted that in American Medical Systems, 6 F.3d at 1537, it interpreted § 287 to allow a patentee who had sold unmarked products to begin recovering damages after the patentee began marking — so that a patentee who had sold unmarked products would have an incentive to begin marking, contrary to the objective of the statute. The Court said that where a party merely stops selling unmarked products but takes no action to remedy prior noncompliance or to provide notice that the articles were actually patented, it has not complied with the notice requirement of § 287 and cannot recover damages for any period prior to the filing of its complaint.

The Federal Circuit made quick work of Arctic Cat’s second argument — that the finding of willfulness dispensed with the need to show notice — pointing out that in In Amsted Indus. Inc. v. Buckeye Steel Castings Co. it held that the determination whether a patentee provided actual notice under § 287 “must focus on the action of the patentee, not the knowledge or understanding of the infringer,” and that “[i]t is irrelevant . . . whether the defendant knew of the patent or knew of his own infringement.”

The Federal Circuit reiterated that willfulness, as an indication that an infringer knew of a patent and of its infringement, does not serve as actual notice as contemplated by § 287.

Patent marking has, including by licensees, was made considerably easier by the AIA which permits “virtual” patent marking. Rather than let a licensee negotiate out a marking provision, patent owners should require their licessees to include a URL to patent information in order to protect subsequent damage claims against infringers.

Presidents’ Day 2020

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While it is appropriate for patent lawyers to acknowledge Abraham Lincoln on Presidents Day (he is, after all, the only president to ever receive a patent) other presidents have be made their mark in patents as well.

In April 1994, near the end of an MTV forum on youth and violence, 17-year-old high school student from Potomac, Maryland, famously asked President Clinton” “The world is dying to know — is it boxers or briefs?” President Clinton’s answer, “usually briefs,” sparked considerable discussion at the time.

A few years later, Robert Wald, of Toluca Lake, California, while the boxers v. briefs debate continued, filed a patent application on Male Boxer Shorts with Integrated Male Briefs, which eventually issued as U.S. Patent No. 5,978,971. The patent solves the need for a male undergarment that combines the benefits of both boxers and briefs.

In Fig. 1 of the ‘971 Patent, it appears that President Clinton’s predecessor, George H. W. Bush, makes a guest appearance, modeling the undergarment under his suit.

A Binding Settlement Agreement Generally Moots the Action Even if it Requires Future Performance

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In Serta Simmons Bedding LLC v. Casper Sleep Inc., [2019-1098, 2019-1159] (February 13, 2020), the Federal Circuit vacated the district court’s summary judgment of non-infringement and remand with instructions to enforce the settlement agreement the parties made prior to the grant of summary judgment.

Casper filed three motions for summary judgment on the issue of non-infringement, and while these motions were pending, the parties executed a settlement agreement, and filed a Joint Notice of Settlement and Motion to Stay, informing the district court that they “entered into a Settlement Agreement” and requesting that all deadlines be stayed. Two days later the district court granted summary judgment for Serta. The district court denied Serta’s motions to enforce the settlement agreement, reasoning that the case was not moot when it issued the summary judgment order because the parties did not intend to immediately dismiss the claims, instead keeping the action alive until the parties fulfilled their obligations under the Settlement Agreement.

On appeal, Casper argued that the Settlement Agreement did not moot the case, because it still had future obligations to perform. The Federal Circuit disagreed, noting that in Exigent Technology, Inc. v. Atrana Solutions, Inc., 442 F.3d 1301 (Fed. Cir. 2006), it held that an enforceable settlement generally renders a case moot even though the parties have not yet performed the terms. The Federal Circuit also noted that other circuits have similarly held that a settlement involving all parties and all claims moots an action even if they contain executory terms. The Federal Circuit held that a binding settlement agreement generally moots the action even if the agreement requires future performance.

The Federal Circuit further found that under Federal Circuit law a district court has jurisdiction to enforce a settlement agreement that resolves patent infringement claims if the motion to enforce is filed before the case is dismissed and the proceedings are ongoing.

The Federal Circuit vacated the district court’s judgment, summary judgment order, and order denying the motion to enforce the Settlement Agreement, and remanded with instructions to enforce the Settlement Agreement. The Court also affirmed he district court’s denial of fees and costs pertaining to proceedings that incurred before the Settlement Agreement, because as a result of the settlement, Casper as not a prevailing party, and in any event the settlement agreement provided that each party bear its own fees..

Petitioner in an IPR is Entitled to Respond to Arguments Made by Patent Owner

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In Apple Inc. v. Andrea Electronics Corp., [2018-2382, 2018-2383] (February 7, 2020), the Federal Circuit vacated the Board’s decision in a first IPR on U.S. Patent No. 6,363,345 because the the Board erred in refusing to consider Apple’s reply arguments, but in the second IPR on the patent, it affirmed the determination that claims 5-9 were not invalid.

The Board’s determinations that a party exceeded the scope of a proper reply are reviewed for abuse of discretion. The Federal Circuit said that a reply may only respond to arguments raised in the corresponding opposition, patent owner preliminary response, or patent owner response. Thus, it had to determine whether we must consider: whether the petitioner’s reply brief was responsive to arguments originally raised in its petition; or whether the reply arguments are responsive to arguments raised in the patent owner’s response brief.

The Federal Circuit noted tat Apple’s legal ground did not change in its reply— its reply still asserted that claims 6–9 would have been obvious over the same references. Further, Apple’s arguments were not the types of arguments that we have previously found to raise a “new theory of unpatentability.” The Federal Circuit noted that Apple’s reply does not cite any new evidence or unidentified portions of the references, but merely demonstrated another example of the same algorithm to further explain why the reference discloses the claim elements. The Federal Circuit said that parties are not barred from elaborating on their arguments on issues previously raised.

The Federal Circuit concluded that Apple’s reply squarely responds to the Patent Owner Response.

You Mess with Me, you Mess with my Whole [Patent] Family

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In Cheetah Omni LLC v. AT&T Services, Inc., [2019-1264] (February 6, 2020) the Federal Circuit affirmed the dismissal of claims for infringement of U.S. Patent No. 7,522,836.

AT&T (and its supplier Ciena) moved for summary judgment that Cheetah’s infringement claim was barred by agreements settling previous litigation between Cheetah and Ciena involving U.S. Patent No. 7,339,714 the patent-in-suit’s “Aunt”.

To dispose of the previous litigation, Cheetah granted to Ciena “a perpetual, irrevocable, worldwide, non-exclusive, fully paid-up license under the Licensed Patents to make, have made (directly or indirectly and solely for Ciena or its Affiliates), use, offer to sell, sell, and import and export the Licensed Products.” “Licensed Patents” were defined as:

(i) the Patents-in-Suit, and (ii) all parents, provisionals, substitutes, renewals, continuations, continuations-in-part, divisionals, foreign counterparts, reissues, oppositions, continued examinations, reexaminations, and extensions of the Patents-in-Suit owned by, filed by, assigned to or otherwise controlled by or enforceable by Cheetah or any of its Affiliates or its or their respective successors in interest at any time as of, prior to, on or after the Effective Date, whether filed before, on or after the Effective Date.

Relying on General Protecht Group Inc. v. Leviton Manufacturing Co., 651 F.3d 1355, 1361 (Fed. Cir. 2011), the district court determined that the ’836 patent was impliedly licensed as the grandchild of the expressly licensed ’925 patent of the ‘714 patent. The Federal Circuit agreed, noting that the presumption established in General Protecht provided a simple and clear resolution in the case. Because the ’925 patent was expressly licensed, the license also included an implied license to a continuation of its continuation, the ’836 patent-in-suit.

Because the licenses extend to both the ’836 patent and the accused AT&T products the district court properly granted summary judgment for AT&T and Ciena and dismissed the infringement suit.

Only an Expert Can Testify about What Would Be Obvious to a Non-Expert

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In HVLPO2, LLC, v. Oxygen Frog, LLC, [2019-1649] (February 5, 2020), the Federal Circuit reversed and remanded the district court’s determination that U.S. Patent Nos. 8,876,941 and 9,372,488 directed to methods and devices for controlling an oxygen-generating system, would have been obvious, because the district court abused its discretion by admitting lay witness testimony regarding obviousness.

At trial, Oxygen Frog argued that the claims were obvious in view of a combination of two prior art references. The author of one of the references, Piebes, was not qualified as an expert witness, but did provide deposition testimony as a fact witness. HVO objected to Mr. Piebes’ testimony regarding obviousness as improper expert opinion testimony. The district court overruled the objection, and instead gave the jury a limiting instruction prior to playing Mr. Piebes’ deposition testimony.

The Federal Circuit found that under the circumstances here, the district court’s limiting instruction was insufficient to cure the substantial prejudice caused by Piebes’ testimony, and thus the district court abused its discretion by denying a motion for a new trial.

The Federal Circuit said that the admission of Piebes’ testimony opining that it would be “obvious” to modify a prior art system in a particular way that would match the claimed invention was improper. It noted that Federal Rule of Evidence 702 provides:

A witness who is qualified as an expert by knowledge, skill, experience, training, or education may testify in the form of an opinion or otherwise if:
(a) the expert’s scientific, technical, or other spe-cialized knowledge will help the trier of fact to un-derstand the evidence or to determine a fact in issue; . . .

The Federal Circuit said that this precisely described testimony which would pertain to an obviousness invalidity challenge in a patent trial. The Federal Circuit said that Issues of infringement and validity are analyzed in great part from the perspective of a person of ordinary skill in the art, such that a witness who is not ‘qualified as an expert by knowledge, skill, experience, training, or education’ in the pertinent art cannot assist the trier of fact to understand the evidence or to deter-mine a fact in issue. Thus, the Federal Circuit said. “it is an abuse of discretion to permit a witness to testify as an expert on the issues of non-infringement or invalidity unless that witness is qualified as an expert in the pertinent art.

The Federal Circuit said that the prohibition of unqualified witness testimony extends to the ultimate conclusions of infringement and validity as well as to the underlying technical questions. A witness not qualified in the pertinent art may not testify as an expert on obviousness, or any of the underlying technical questions, such as the nature of the claimed invention, the scope and content of the prior art, the differences between the claimed invention and the prior art, or the motivation of one of ordinary skill in the art to combine these references to achieve the claimed invention.

Because the district court abused its discretion by admitting lay witness testimony regarding obviousness, the Federal Circuit reversed and remanded for a new trial.

Federal Circuit Asks PTAB to Give it a Go and Decide Whether Indefinite Claims Were otherwise Patentable

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In Samsung Electronics America, Inc. v. Prisua Engineering Corp., 2019-1169, 2019-1260 (February 4, 2020) the Federal Circuit affirmed the PTAB determination that claim 11 of U.S. Patent No. 8,650,591 was invalid for obviosuness, but vacated the PTAB’s decision declining to decide whether claims 1-4 and 8 were patentable because these claims were indefinite.

The claims of the ‘591 patent are directed to methods and apparatuses for generating a displayable edited video data stream from an original video data stream. The Board determined that claim 1 (and claims 2-4 and 8) claimed both an apparatus and a method, and thus was indefinite under IPXL Holdings. Because the claims were indefinite, the Board declined to determine whether they otherwise defined patentable subject matter. The Board also found the claims indefinite because of the inclusion of “digital processing unit” which the Board found invoked 112(f), without identifying any corresponding stucture in the claims.

Samsung appealed arguing that the Board should have declared the claims in valid for indefiniteness. The Federal Circuit agreed with the Board that the Board did not have the authority to invalidate claims on that ground.

Samsung’s secondary argument was that the Board should have nonetheless assessed the patentability of claims 1 and 4–8 under sections 102 or 103. On this point, the Federal Circuit agreed.

The Federal Circuit noted that on the first ground of indefiniteness — mixed method and apparatus claiming, the indefiniteness problem was one of understanding when infringement occurred, and not necessarily what the claim actually means. Moreover, the Federal Circuit noted that the Board had previously held that IPXL-type indefiniteness does not prevent the Board from addressing patentability.

Thus the Federal Circuit remanded the case for the Board to attempt to apply 102 and 103 to the claims.

As to the second ground of indefiniteness, that “digital processing unit” invoked 112(f) without providing corresponding structure in the claims, the Federal Circuit disagreed. The Federal Circuit said that the question whether the term “digital processing unit” invokes section 112, paragraph 6, depends on whether persons skilled in the art would understand the claim language to refer to structure, assessed in light of the presumption that flows from the drafter’s choice not to employ the word “means. The Federal Circuit said that the Board pointed to no evidence that a person skilled in the relevant art would regard the term “digital processing unit” as purely functional. In fact, the patent owner argued to the Board, based on testimony from its expert (the inventor), that the digital processing unit recited in the claims is “an image processing device that people in the art are generally familiar with.” Moreover, the fact that claim 1 required the “digital processing unit” to be operably connected to a “data entry device” supports the structural nature of the term “digital processing unit,” as used in the claim.

The Federal Circuit rejected the Board’s conclusion that the term “digital processing unit,” as used in claim 1, invoked means-plus-function claiming,
and that for that reason claims 1 and 4–8 cannot be analyzed for anticipation or obviousness.

Recognizing the History-Makers in Black History Month

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An important part of black history is the many inventive contributions of black Americans. The achievements of just a few of them are highlighted below.

George Washington Carver was an African American scientist and educator, famous for many inventions relating to peanuts. He as born into slavery but become one of the most prominent scientists and inventors of his time, as well as a teacher at the Tuskegee Institute. Carver did not patent most of his inventions, but did receive three patents, including U.S. Patent No. 1,522,176 on a Cosmetic and Process for Making Same, and U.S. Patent No. 1,632,236 on Process of Producing Paints and Stains.

Lonnie G. Johnson is a former Air Force/NASA engineer who among other things, invented the Super Soaker water gun, for which he received U.S. Patent No. 5,074,437.

U.S. Patent No. 5,074,437

Johnson’s other patents include U.S. Patent No. 5,982,144 on Rechargeable Battery Power Supply Overcharge Protection Circuit; U.S. Patent Nos. 6,000,386 and 6,003,503 on Toy Gun with Fluid Pulsator; U.S. Patent No. 6,099,266 on Air Pump; U.S. Patent No. 6,180,281 on Composite Separator and Electrode; U.S. Patent No. 6,220,237 on Compressed Air Toy Gun; U.S. Patent No. 6,223,449 on Apparatus for Extracting Plasticizer; U.S. Patent Nos. 9,266,085 and 9,387,453 on Johnson Ambient-Heat Engine.

Garrett Morgan, the son of a freed slave, started out as a sewing-machine mechanic, but went to patent several inventions, including a hair-straightening product, a breathing device (U.S. Patent No. 1,113,675), an improved sewing machine and an improved traffic signal (U.S. Patent No. 1,475,074).

Lewis H. Latimer was an patent draftsman and inventor in his own right who worked with Thomas Edison, Alexander Graham Bell, and Hiram Maxim. His greatest invention may be the carbon filament for light bulbs , a vital component of the light bulb (U.S. Patent No. 252,386).

U.S. Patent No. 252,386

His other inventions included Water-Closets for Railroad-Cars (U.S. Patent No. 147,363); Electric Lamp (U.S. Patent No. 247,097), Globe Supporter for Electric Lamps (U.S. Patent No. 255,212); Apparatus for Cooling and Disinfecting (U.S. Patent No. 334,078); Locking Rack for Hats, Coats, Umbrellas, &c. (U.S. Patent No. 557,076); and Book Supporter (U.S. Patent No. 781,890).

Marie Van Brittan Brown was an African-American inventor, who, motivated by how long it would take the police to arrive in her neighborhood, invented the first form of a home security system. Her U.S. Patent No. 3,482,037 issued in 1969.

U.S. Patent No. 3,482,037

Otis Frank Boykin was an African American engineer and inventor of as many as 27 electronic devices, but he is best known for inventing electronic control devices for guided missiles, IBM computers, and the pacemaker. His other inventions included a Resistor, U.S. Patent 2,634,352 and 2,891,227; Electrical Resistor And Method Of Making The Same, U.S. Patent No. 4,418,009, and 4,561,996; Self Supporting Electrical Resistor Composed Of Glass, Refractory Materials And Noble Metal Oxide (U.S. Patent No. 4,267,074.

Marian R Croak is a Vice President of Engineering at Google. She was previously Senior Vice President of Research and Development at AT&T Labs, where she is credited as a developer of Voice over IP (VoIP) creating most of methods and features that both improved its reliability and ushered in its nearly universal adoption, and more than 125 of her more than 200 U.S. patents cover VoIP.

Her U.S. patents include: 10,295,358, 9,823,087, 9,621,719, 9,360,327, 9,344,322, 9,282,198, 9,224,108, 9,219,820, 9,210,027, 9,137,361, 9,078,023, 9,054,887, 9,014,053, 9,001,987, 8,983,046, 8,954,352, 8,953,763, 8,942,367, 8,934,474, 8,897,436, 8,885,638, 8,867,525, 8,867,524, 8,855,908, 8,837,695, 8,836,752, 8,804,703, 8,804,539, 8,799,976, 8,798,258, 8,793,150, 8,787,551, 8,775,639, 8,755,496, 8,750,479, 8,737,584, 8,737,575, 8,737,381, 8,731,164, 8,730,952, 8,730,941, 8,718,265, 8,711,680, 8,705,518, 8,705,401, 8,699,681, 8,693,665, 8,687,502, 8,682,711, 8,681,633, 8,676,702, 8,675,857, 8,675,638, 8,670,323, 8,667,545, 8,660,903, 8,654,788, 8,654,670, 8,644,296, 8,638,656, 8,625,770, 8,625,754, 8,625,578, 8,615,004, 8,615,003, 8,614,959, 8,612,512, 8,611,258, 8,600,009, 8,594,128, 8,593,939, 8,588,216, 8,588,083, 8,582,590, 8,576,832, 8,570,906, 8,565,409, 8,553,863, 8,549,156, 8,538,005, 8,532,088, 8,520,816, 8,520,811, 8,515,045, 8,457,108, 8,437,337, 8,437,246, 8,411,668, 8,379,817, 8,369,230, 8,358,770, 8,358,760, 8,355,314, 8,340,261, 8,307,091, 8,306,190, 8,295,461, 8,284,679, 8,279,856, 8,275,828, 8,265,256, 8,259,608, 8,254,540, 8,243,912, 8,238,353, 8,213,584, 8,199,744, 8,199,742, 8,184,792, 8,184,548, 8,155,295, 8,150,009, 8,130,934, 8,130,932, 8,130,923, 8,107,459, 8,098,803, 8,098,281, 8,094,568, 8,072,968, 8,072,881, 8,064,452, 8,064,438, 8,059,645, 8,018,835, 7,995,739, 7,995,709, 7,995,486, 7,995,464, 7,983,404, 7,978,601, 7,974,292, 7,965,700, 7,958,561, 7,948,965, 7,933,213, 7,925,503, 7,924,814, 7,912,039, 7,903,798, 7,899,159, 7,881,294, 7,881,289, 7,852,991, 7,852,832, 7,843,964, 7,843,841, 7,839,992, 7,801,115, 7,801,114, 7,797,459, 7,792,269, 7,783,024, 7,778,402, 7,773,734, 7,760,861, 7,756,254, 7,756,024, 7,746,771, 7,738,641, 7,738,446, 7,734,024, 7,734,022, 7,734,021, 7,733,850, 7,733,847, 7,715,548, 7,715,412, 7,715,368, 7,668,714, 7,664,252, 7,664,241, 7,664,237, 7,664,106, 7,664,101, 7,664,099, 7,664,039, 7,664,038, 7,664,033, 7,639,793, 7,639,790, 7,627,106, 7,626,980, 7,626,941, 7,623,647, 7,613,113, 7,609,830, 7,602,900, 7,602,887, 7,599,359, 7,599,357, 7,593,520, 7,593,343, 7,593,325, 7,583,794, 7,583,660, 7,580,792, 7,555,113, 7,532,579, 7,522,717, 7,468,984, 7,450,502, 7,447,160, 7,447,159, 7,440,445, 7,417,984, 7,415,010, 7,411,942, 7,369,506, 7,231,210, 7,224,773, 5,987,508.

General Knowledge is Available in Obviousness Inquiry Even Though IPRs are Limited to Documentary Prior Art

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In Koninklijke Philips N.V. v. Google, [2019-1177] (January 30, 2020), the Federal Circuit affirmed the PTAB determination that claims 1-11 of U.S. Patent No. 7,529,806 were unpatentable as obvious.

Philips presetnted three arguments on appeal. First, that the Board erred by instituting inter partes review on the ground that the claims would have been obvious over SMIL 1.0 in light of Hua because Google did not advance that specific combination in its petition. Second, that the Board erred in finding that the claims would have been obvious in view of SMIL 1.0 because the Board impermissibly relied on “general knowledge” to supply a missing claim limitation. Third, that the Board’s obviousness findings are nevertheless unsupported by substantial evidence.

On Philips’ first point, the Federal Circuit agreed, holding that the Board erred by instituting inter partes review based on a combination of prior art references not advanced in Google’s petition. 35 U.S.C. § 311(a) does not contemplate a petition that asks the Director to initiate whatever kind of inter partes review he might choose.

On Philips’ second point, the Federal Circuit disagreed with Philips’ argument that because 35 U.S.C. § 311(b) expressly limits inter partes reviews to “prior art consisting of patents or printed publications,” and because general knowledge is neither of those, § 311(b) prohibits use of general knowledge to supply a missing claim limitation in an inter partes review. The Federal Circuit explained that although the prior art that can be considered in inter partes reviews is limited to patents and printed publications, it does not follow that we ignore the skilled artisan’s knowledge when determining whether it would have been obvious to modify the prior art.

The Federal Circuit also disagreed with Philips that the Board’s reliance on “general knowledge” violated Arendi. The Federal Circuit explained that in Arendi it cautioned that although “common sense and common knowledge have their proper place in the obviousness inquiry,” (a) invoking “common sense . . . to supply a limitation that was admittedly missing from the prior art” should generally only be done when “the [missing] limitation in question [is] unusually simple and the technology particularly straightforward;” and (b) references to common sense “cannot be used as a whole-sale substitute for reasoned analysis and evidentiary support.” The Federal Circuit said that in Arendi, the Board relied on nothing more than “conclusory statements and unspecific expert testimony” in finding that it would have been “common sense . . . to supply a limitation that was admittedly missing from the prior art.” Conversely, in the present case, the Federal Circuit found that the Board relied on expert evidence, which was corroborated by Hua, in concluding that pipelining was not only in the prior art, but also within the general knowledge of a skilled artisan.

Finally, the Federal Circuit disagreed with Philips third point, that the finding of obvious was not supported by substantial evidence. The Federal Circuit noted that the Board thoroughly explained why the modified prior art disclosed all the limitations of claim 1, The Federal Circuit said that relying on an expert declaration and reference as evidence of a skilled artisan’s general knowledge, the Board found that a skilled artisan “would have been motivated to modify the prior art. The Board also determined that there would have been a reasonable expectation of success. The Federal Circuit concluded concluded that the Board’s findings are supported by substantial evidence.