Monthly Archives: May 2021

The References are not the Only Sources a Person of Ordinary Skill Would Consider

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In Becton, Dickinson and Company v. Baxter Corporation Englewood, [2020-1937] (May 28, 2021), the Federal Circuit reversed that PTAB determination that certain claims of U.S. Patent No. 8,554,579 were not invalid as obvious. The’579 Patent is directed to systems for preparing patient-specific doses and a telepharmacy method in which data captured while following a protocol associated with each received drug order and specifying a set of steps to fill the drug order are provided to a remote site for review and approval by a pharmacist.

At issue was whether the art disclosed a verification step. Baxter successfully argued to the PTAB that the art taught that there may be a verification step, but not that there must be a verification step. The Federal Circuit concluded that the Board’s determination was not supported by substantial evidence. The Federal Circuit said that in the context of the prior art, “may” does not mean “occasionally,” but rather that one “may” choose to systematically check each step. Examining the reference, the Federal Circuit concluded that the purpose was to provide verification, and thus it satisfied the verification step.

Also at issue was whether the art diclosed the highlighting limitation, which requires “an interactive screen that includes prompts that can be highlighted by an operator to receive additional information relative to one particular step.” The Federal Circuit found that one of the references teaches highlighting in the pharmacy context, and said that the Board erred in looking to the reference as the only source a person of ordinary skill would consider for what “additional information might be relevant. A person of ordinary skill is also a person of ordinary creativity, not an automaton.

Finally, the Federal Circuit said that Baxter does not meaningfully argue that the weak showing of secondary considerations here could overcome the showing of obviousness based on the prior art.

Don’t Forget to Claim What the Device Is, Not Just What the Device Does

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In Bio-Rad Laboratories, Inc. v. ITC, [2020-1475, 2020-1605] (May 28, 2021), the Federal Circuit affirmed the Com-mission’s determination that 10X did not infringe the claims of U.S. Patent No. 9,500,664, and that 10X infringed the claims of U.S. Patent Nos. 9,636,682 and 9,649,635.

The relate generally to the field of microfluidics, and specifically to the generation of microscopic droplets, and in particular to systems and methods for generating microscopic droplets by using a micro-fluidic device commonly referred to as a “chip.”

Regarding the ‘664 patent, the ALJ determined that because the accused Chip GB does not involve a “sample,” it “does not include a ‘sample well,’ a sample channel, sample-containing droplets, or the claimed ‘droplet generation region.’” The Federal Circuit found that the patent distinguished between samples and reagents, and that the accused product was used with reagents and not samples as required by the claims. 10X and the ITC argued that the ALJ applied the exact construction of “sample” to which the parties agreed, and that Bio-Rad’s challenge is really directed at the ALJ’s factual application of that construction to the accused Chip GB, which the Federal Circuit found was supported by substantial evidence.

Bio-Rad also contended that, regardless whether the monomer solution in the accused Chip GB is a “sample,” the claims recite structural limitations all of which are included in the accused Chip GB. The Federal Circuit rejected the argument for several reasons. First, it was not clear that Bio-Rad raised this argument before the Commission. Second, the argument is premised on rewriting the claims in an oversimplified form and removing all limitations that differentiate the recited structures from each other. The Federal Circuit noted that the inventors did not seek patent protection for a broad claim to “a chip with three wells and interconnecting channels.” Nor did the inventors choose to differentiate the wells and channels from each other based on physical characteristics (e.g., shape, size, depth, location, etc.). Instead, the inventors chose to characterize the wells and channels based on the material contained within them. “Bio-Rad cannot escape that choice by pointing to the general proposition of law that “apparatus claims cover what a device is, not what a device does.”

With respect to the appeal of the finding infringement of the ‘682 and ‘635 patents, 10X argued error with respect to the ITC construction of “droplet-generation region.” However, the Federal Circuit found that the ALJ’s construction of the term “droplet-generation region” was consistent with the intrinsic evidence, and like the ITC, the Federal Circuit rejected 10X’s attempt to impose an unclaimed limitation that requires a channel to extend directly from the sample well to the droplet-generation region. The Federal Circuit found that under the ALJ’s correct construction, substantial evidence supported the Commission’s finding that the use of 10X’s accused chips directly infringes the asserted claims of the ’664, ’682, and ’635 patents.

On the issues of contributory infringement and inducement of infringement, the Federal Circuit concluded there was substantial evidence to support the ALJ’s findings.

Applying Vitiation to “Annular Cover” was Circular Reasoning

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In Edgewell Personal Care Brands, LLC v. Munchkin, Inc., [2020-1203] (May 26, 2021 modifying March 9, 2021, opinion), the Federal Circuit vacated-in-part, reversed-in-part, and remanded the district court’s summary judgement of no infringement of U.S. Patent Nos. 8,899,420 and 6,974,029 on Diaper Genie refills.

The claims of the ‘420 patent were directed to a cassette intended for use in the Diaper Genie.  The Federal Circuit noted that a cassette has a clearance that will ensure proper insertion whether a space remains after insertion or not. We thus conclude that the district court erred by adding this limitation into its construction. The clearance limitation is satisfied when the cassette itself is constructed with a clearance. The claim does not require a clearance after insertion; in fact, such a requirement would be at odds with many of the disclosed embodiments and is simply not required by the claims. The Federal Circuit reasoned: “The clearance limitation is satisfied when the cassette itself is constructed with a clearance. The claim does not require a clearance after insertion; in fact, such a requirement would be at odds with many of the disclosed embodiments and is simply not required by the claims.”

With respect to the claims of the ‘029 patent, the Federal Circuit found that although the district court correctly construed “annular cover” as being a single structure, the district court erred in concluding that Edgewell’s theory of infringement under the doctrine of equivalents vitiates or renders meaningless the “annular cover” claim element. The Federal Circuit explained that vitiation has its clearest application where the accused device contains the antithesis of the claimed structure.  But warned that, as it explained in Deere & Co. courts should be cautious not to shortcut this inquiry by identifying a ‘binary’ choice in which an element is either present or not present.  The determination of equivalence depends not on labels like ‘vitiation’ and ‘antithesis’ but on the proper assessment of the language of the claimed limitation and the substantiality of whatever relevant differences may exist in the accused structure.”). Applying these concepts to the facts of this case, the Federal Circuit concluded that the district court erred in evaluating the element as a binary choice between a single-component structure and a multi-component structure, rather than evaluating the evidence to determine whether a reasonable juror could find that the accused products perform substantially the same function, in substantially the same way, achieving substantially the same result as the claims. Because the district court based its grant of summary judgment of noninfringement of the ’420 patent on an erroneous construction, the Federal Circuit vacated that judgment and remanded. Because the district court erred in granting Munchkin summary judgment of noninfringement of the ’029 patent, the Federal Circuit reversed that judgment and remanded

Federal Circuit Ignores Forum Selction Clause Allowing IPR to Proceed

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In New Vision Gaming & Development, Inc., v. SG Gaming, Inc., [2020-1399, 2020-1400](May 13, 2021) the Federal Circuit vacated PTAB decisions that U.S. Patent Nos. 7,451,987 and 7,325,806, as well as proposed substitute claims, are patent ineligible under 35 U.S.C. § 101, and remanded the case for further proceedings consistent with Arthrex.  The Federal Circuit said that because Arthrex issued after the Board’s final-written decisions and after New Vision sought Board rehearing, New Vision had not waived its Arthrex challenge by raising it for the first time in its opening brief before the Court.

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Judge Newman agreed that Arthrex applied but dissented because the Court did not address the forum selection clause in the license between the parties.  The parties agreed that “any dispute between any of the parties that cannot be resolved amicably” should be resolved in the state and federal courts in the State of Nevada, and thus Judge Newman argued that the forum question requires resolution, for if the parties are committed to a Nevada forum instead of the PTAB, there is no basis for new PTAB proceedings on remand.

Thus, while I Judge Newman agreed that the Board’s decision must be vacated under Arthrex, she respectfully dissented from remand without resolving the issue of forum selection.

Federal Circuit Ignores Forum Selection Clause that Could Have Prevented IPR

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In New Vision Gaming & Development, Inc., v. SG Gaming, Inc., [2020-1399, 2020-1400](May 13, 2021) the Federal Circuit vacated PTAB decisions that U.S. Patent Nos. 7,451,987 and 7,325,806, as well as proposed substitute claims, are patent ineligible under 35 U.S.C. § 101, and remanded the case for further proceedings consistent with Arthrex.  The Federal Circuit said that because Arthrex issued after the Board’s final-written decisions and after New Vision sought Board rehearing, New Vision had not waived its Arthrex challenge by raising it for the first time in its opening brief before this Court.

Judge Newman agreed that Arthrex applied but dissented because the Court did not address the forum selection clause in the license between the parties.  The parties agreed that “any dispute between any of the parties that cannot be resolved amicably” should be resolved in the state and federal courts in the State of Nevada, and thus Judge Newman argued that the forum question requires resolution, for if the parties are committed to a Nevada forum instead of the PTAB, there is no basis for new PTAB proceedings on remand.

Thus, while Judge Newman agreed that the Board’s decision must be vacated under Arthrex, she respectfully dissented from remand without resolving the issue of forum selection.

Posted in IPR

A Cease and Desist Letter Can Confer Personal Jurisdiction

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In Trimble Inc., Innovative Software Engineering, LLC, v. Perdiemco LLC, [2019-2164] (May 12, 2021), the Federal reversed the dismissal of Trimble’s declaratory judgment noninfringement action against PerDiemCo LLC for lack of personal jurisdiction.

Base upon Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355 (Fed. Cir. 1998), the United States District Court for the Northern District of California held that it would be unreasonable to assert personal jurisdiction over PerDiemCo based on its communications to Trimble in California. However the Federal Circuit concluded that Red Wing does not preclude personal jurisdiction on the facts of this case and that the district court had personal jurisdiction over PerDiemCo.

PerDiemCo’s current sole owner, officer, and employee is Robert Babayi. He lives and works in Washington, D.C. PerDiemCo rents office space in Marshall, Texas. Mr. Babayi has never visited the rented space, and PerDiemCo has no employees in Marshall.  In October 2018, Mr. Babayi, on behalf of PerDiemCo, sent a letter to ISE in Iowa accusing ISE’s products and services of using technology covered by at least PerDiemCo’s electronic-logging-device patents. The letter also explained that PerDiemCo actively licences its patents and listed at least ten companies that had entered into nonexclusive licenses after the companies had “collectively spent tens of millions of dollars in litigation expenses.” Attached to PerDiemCo’s letter was an unfiled complaint for the Northern District of Iowa, which asserted nine of PerDiemCo’s patents against ISE’s products and services, and a claim chart that provided further detail re-garding the alleged infringement. The letter also offered ISE a nonexclusive license to PerDiemCo’s patents, proposed that the parties engage in negotiations, and attached a draft nondisclosure agreement to facilitate the parties’ discussions.  The parties entered negotiations, during which PerDiemCo communicated with Trimble via letter, email, or telephone at least twenty-two times.  In this correspondence and telephone calls, PerDiemCo threatened to sue Trimble for patent infringement in the Eastern District of Texas and identified counsel that it had retained for this purpose.

In Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355 (Fed. Cir. 1998), the Federal Circuit states that a patentee should not subject itself to personal jurisdiction in a forum solely by informing a party who happens to be located there of suspected infringement because grounding personal jurisdiction on such contacts alone would not comport with principles of fairness,  The Fedeal Circuit noted three subsequent developments that have clarified the scope of Red Wing.

First, the Supreme Court cases following Red Wing have made clear that the analysis of personal jurisdiction cannot rest on special patent policies.  Second, the Supreme Court has held that communications sent into a state may create specific personal jurisdiction, depending on the nature and scope of such communications.  Third, the Supreme Court’s recent decision in Ford has established that a broad set of a defendant’s contacts with a forum are relevant to the minimum contacts analysis.

Given these developments and consistent with the Supreme Court’s instruction to treat “isolated or sporadic [contacts] differently from continuous ones,” the Federal Circuit concluded that Red Wing remains correctly decided with respect to the limited number of communications involved in that case. However, there is no general rule that demand letters can never create specific personal jurisdiction. The Federal Circuit said the central question under Red Wing is now whether a defendant’s connection to a forum is sufficient to satisfy the minimum contacts or purposeful availment test and, whether the exercise of jurisdiction con-forms to the due process and fairness criteria of precedent.  The Federal Circuit concluded that the minimum contacts or purposeful availment test was satisfied

The Federal Circuit said that PerDiemCo thus has not made a compelling case that the presence of some other considerations would render jurisdiction unreasonable, and it reversed the district court’s order finding a lack of personal jurisdiction and remanded for further proceedings.

Intrinsic Evidence > Dictionary Definitions, Analogies, and Purported Plain Meaning

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 In Uniloc 2017 LLC v. Apple Inc., [2020-1403, 2020-1404] (May 12, 2021), the Federal Circuit affirmed the PTAB determination that claims 1–17 and 23–25 of  U.S. Patent No. 8,539,552 were invalid for obviousness.

The ’552 patent is directed to a system and method to police the use of various optional features, such as caller-ID, call waiting, multi-line service, and different levels of service quality known as the “codec specification.”

On appeal, Uniloc contended that the Board’s construction of “intercepting” in the independent claims was erroneous and that the Board incorrectly held claims 1–17 and 23–25 invalid as a result. In its cross-appeal, Apple argued that the Board erroneously rejected its challenge to claims 18–22.

As to Unilock’s appeal the Federal Circuit noted that because the receiving client device is the ultimate “intended recipient” does not mean that the sending client device cannot intentionally direct the message to the intercepting entity.  The Federal Circuit held that the claims encompass the situation in which a sending client device intentionally sends a signaling message to the intermediate network entity that per-forms the interception. Contrary to Uniloc’s contention, the Federal Circuit said that construction is not at odds with the plain meaning of the claims. The receiving client device is still “the intended recipient” of the message because it is the ultimate, in-tended destination of that message.  The Federal Circuit further further noted that the Board’s construction is supported by the prosecution history. The Federal Circuit said it arrived at its construction by focusing on the prosecution history, the specification, and the context of the particular claims in which the term “intercepting” appears, which outweighed Uniloc’s reliance on dictionary definitions, analogies, and the purported plain meaning of “intercepting” in isolation.

The Federal Circuit said it arrived at its construction by focusing on the prosecution history, the specification, and the context of the particular claims in which the term “intercepting” appears, which outweighed Uniloc’s reliance on dictionary definitions, analogies, and the purported plain meaning of “intercepting” in isolation.

Being Able to Practice the Invention is not the Same as Being Able to Practice the Full Scope of the Invention

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In Pacific Biosciences of California, Inc. v. Oxford Nanopore Technologies, Inc., [2020-2155, 2020-2156] (May 11, 2021), the Federal Circuit affirmed the jury determination that U.S. Patent Nos. 9,546,400 and 9,772,323 were invalid under 35 U.S.C. § 112 for lack of enablement, and the denial of a new trial because of Oxford’s improper remarks during opening remarks.

The Federal Circuit said that there was ample evidence to support a finding that, before the priority date of the ’400 and ’323 patents, relevant artisans did not know how to perform the claimed method for more than a narrow range of the full scope of nucleic acids covered by the asserted claims. The Federal Circuit said that testimony that a person skilled in the art would be able to successfully perform the method of claim 1 might not have been understood by the jury that the full scope of the claim was enabled. The Federal Circuit said that the jury’s task was not to view one portion of the testimony in isolation, but to consider all the evidence, including any portion of the evidence that might clarify how to understand other portions.

Regarding the motion for a new trial, the Federal Circuit said A new trial based on improper remarks is proper if “the appellee made prejudicial re-marks and it is ‘reasonably probable’ those prejudicial remarks influenced the jury’s verdict. The Federal Circuit saw EWe see no abuse of discretion in the district court’s determination that the opening remarks were not sufficiently likely to have influenced the jury to create a miscarriage of justice. The Federal Circuit found no abuse of discretion in the district court’s determination that the opening remarks were not sufficiently likely to have influenced the jury to create a miscarriage of justice. In particular the Federal Circuit noted that PacBio did not object in advance when it learned about the content of Oxford’s opening remarks, and mentioned the same subject in its own remarks. Further the Court gave the exact curative instruction that PacBio requested.