IP Update, Volume 3, No. 12, December 2000
December 2000
IN THIS ISSUE
- Patents/Infringement - The Festo Decision: The Federal Circuit Scales Back the Doctrine of Equivalents
- Trademarks/Dilution - Actual Dilution Is Not Required Under the Federal Dilution Act
- Patents/Inequitable Conduct - Nondisclosure of an Adverse Board Decision Regarding Priority Dates Coupled with Claims of Priority Results in Finding of Inequitable Conduct
- Patents/Claim Construction - Specification Can Limit Even Structural Recitations to a Single Disclosed Embodiment
The Festo Decision: The Federal Circuit Scales Back the Doctrine of Equivalents
By Keith George and Paul Devinsky
Shockwaves rippled through the patent community on November 29, 2000, when the Court of Appeals for the Federal Circuit, sitting en banc, handed down its decision in Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., Ltd., No. 95-1066 (Fed. Cir. Nov. 29, 2000). The Court’s decision expands the application and impact of "prosecution history estoppel" when considering the question of infringement under the doctrine of equivalents. The result is that a patentee will be more restricted when relying on the doctrine of equivalents to prove infringement.
In rendering its decision, the Court addressed four questions that had arisen in the wake of the Supreme Court’s decision in Warner-Jenkinson.
1. For the purposes of determining whether an amendment to a claim creates prosecution history estoppel, is a "substantial reason related to patentability," Warner-Jenkinson, limited to those amendments made to overcome prior art under § 102 and § 103, or does "patentability" mean any reason affecting the issuance of a patent?
The Court’s answer: "for the purposes of determining whether an amendment gives rise to prosecution history estoppel, a 'substantial reason related to patentability' is not limited to overcoming or avoiding prior art, but instead includes any reason which relates to the statutory requirements for a patent." Accordingly, "a narrowing amendment made for any reason related to the statutory requirements for a patent will give rise to prosecution history estoppel with respect to the amended claim element." The Court identified the following applicable statutory requirements: novelty (§ 102); nonobviousness (§ 103); patentable subject matter and usefulness (§ 101); the written description, enablement, and best mode requirements (§ 112, ¶1); and the definiteness requirement (§ 112, ¶ 2). However, the Court noted that "if a patent holder can show from the prosecution history that a claim amendment was not motivated by patentability concerns, the amendment will not give rise to prosecution history estoppel."
2. Under Warner-Jenkinson, should a "voluntary" claim amendment– one not required by the examiner or made in response to a rejection by an examiner for a stated reason–create prosecution history estoppel?
The Court’s answer: "[v]oluntary claim amendments are treated the same as other amendments. Therefore, a voluntary claim amendment that narrows the scope of a claim for a reason related to the statutory requirements for a patent will give rise to prosecution history estoppel as to the amended claim element." The Court explained as the basis for its decision that both voluntary amendments and amendments required by the US Patent Office "signal to the public that subject matter has been surrendered."
3. If a claim amendment creates prosecution history estoppel, under Warner-Jenkinson what range of equivalents, if any, is available under the doctrine of equivalents for the claim element so amended?
The Court’s answer to this question is by far the most controversial part of its decision: "when a claim amendment creates prosecution history estoppel with regard to a claim element, there is no range of equivalents available for the amended claim element. Application of the doctrine of equivalents to the claim element is completely barred (a 'complete bar')." In reaching its
decision, the Federal Circuit stated that in the years since the Court was founded, "the notice function of patent claims has become paramount, and the need for certainty as to the scope of patent protection has been emphasized." Thus, a complete bar "best serves the notice and definitional function of patent claims. . . . The patentee and the public can look to the prosecution history, a public record, to determine if any prosecution history estoppel arises as to any claim element."
4. When "no explanation [for a claim amendment] is established," thus invoking the presumption of prosecution history estoppel under Warner-Jenkinson, what range of equivalents, if any, is available under the doctrine of equivalents for the claim element so amended?
The Court’s answer to Question 4 was also "none." "When no explanation for a claim amendment is established, no range of equivalents is available for the claim element so amended."
Practice Note: Every person preparing and prosecuting patent applications must now take the prosecution history estoppel and resulting bars to any range of equivalents into account.
The question of a bar against equivalents never arises if the claim literally covers an accused product or method. Patent applicant’s are now likely to more vigorously pursue the broadest coverage possible, both in preparing the application and in prosecuting it before the US Patent Office.
The Festo estoppel against equivalents only applies where there is an amendment, and that amendment narrows the scope of the claim. Thus, patent applicants should take even more care than before to ensure that prior to filing their applications, the claims are "polished" to eliminate avoidable changes, and/or to distinguish known art.
During prosecution, whenever a reasonable argument is available to overcome a rejection without amendment, applicants are more likely to resist making any amendment at all to preserve the breadth of the claims for literal infringement and to avoid narrowing amendments that lead to equivalent is barring estoppels. Also, in those instances where it becomes necessary to amend a claim during prosecution, applicants are more likely to exert restraint about how extensive an amendment he or she is willing to make. If the objective of an amendment is simply clarity, applicants are more likely to attempt a remedy by clarifying the text without narrowing the claim scope.
In those instances where an amendment is necessary to overcome the art, a practitioner’s objective must be to maintain a claim scope that is sufficiently broad to literally encompass as many viable commercial embodiments as possible. Also, applicants should take great care to amend the only precise "element" needed to distinguish over the prior art. Practitioners now may wish to separate claim limitations into as many different small paragraphs or "elements" as possible so that if an amendment is necessary, only the minimum number of elements are affected.
It now may be even more advantageous than ever to include a large number of independent claims of varying scope. For example, if one claim is allowed and another is rejected, it would be a simple matter to cancel the rejected claim. There would be at least some room to argue that the remaining claim was allowed without amendment as to any specific element.
Use of §112, ¶6 claim elements may prove more attractive in the future as well. If an amendment involves adding an element by employing means-plus-function form, it may be possible in some situations to cover at least structural equivalents to the disclosed structure thereby attenuating the harshness of the total bar to doctrine of equivalents under Festo.
Actual Dilution Is Not Required Under the Federal Dilution Act
By John Dabney
The Seventh Circuit has held that a plaintiff is not required to prove actual dilution in order to prevail on a dilution claim under the Federal Dilution Act and that a plaintiff is entitled to prevail on a dilution claim if the plaintiff’s mark is famous and the parties’ marks are "highly similar." Eli Lilly & Company v. Natural Answers, Inc., 2000 U.S. App. LEXIS 29547 (7th Cir., Nov. 21, 2000).
The defendant used the trademark HERBOZAC for a dietary supplement. The plaintiff, owner of the trademark PROZAC for a prescription drug, filed suit, alleging a federal dilution claim. The District Court awarded a preliminary injunction in favor of plaintiff on its dilution claim.
On appeal, the Seventh Circuit affirmed and made two significant rulings. First, the court expressly held that a plaintiff is entitled to prevail on a dilution claim under federal law if it demonstrates a "likelihood of dilution"—actual dilution is not required. The court based its holding, in part, on the extreme difficulty of proving actual dilution: "[W]e doubt that dilution of the distinctiveness of a mark is something that can be measured on an empirical basis by even the most carefully constructed survey." Thus, the court concluded, "[I]t is hard to believe that Congress would create a right of action but at the same time render proof of the plaintiff’s case all but impossible" by requiring proof of actual dilution. In rendering its holding, the Seventh Circuit expressly acknowledged that it was parting ways with the Fourth and Fifth Circuits, which have held that "actual dilution" is required in order to prevail on a federal dilution claim.
Second, the Seventh Circuit expressly rejected many of the factors that have been considered by other courts in determining a likelihood of dilution, i.e., the similarity of the parties' products, the sophistication of customers, the intent of the defendant and the renown of the defendant’s mark. The Court reasoned that while these factors bear on whether there is a likelihood of confusion, they are "not particularly relevant" in establishing whether there is a likelihood of dilution. Instead, if the parties’ marks are "highly similar" and the plaintiff’s mark has achieved "extraordinary fame," sufficient grounds exist to justify a finding of a likelihood of dilution and an injunction under the federal antidilution law.
Nondisclosure of an Adverse Board Decision Regarding Priority Dates Coupled with Claims of Priority Results in Finding of Inequitable Conduct
By Leonard T. Guzman
A patent applicant’s persistent course of nondisclosure of an adverse decision of the U.S. Patent and Trademark Office (PTO) Board of Appeals (Board) regarding a priority claim and repeated claim for priority in a related application meet the threshold levels of materiality and intent for a finding that Applicant engaged in inequitable conduct before the PTO. Li Second Family Partnership v. Toshiba Corp., No. 99-1451 (Fed. Cir. November 8, 2000).
The Li Second Family Partnership (Li) sued Toshiba Corporation and Toshiba America Electronic Components, Inc. (collectively "Toshiba") alleging that Toshiba makes semiconductor devices using a process that infringes several claims of Li’s US Pat. No. 4,946,800 (the '800 patent). Among its defenses, Toshiba alleged that the '800 patent is unenforceable because Li engaged in inequitable conduct before the PTO by reason of a failure to disclose events that occurred during prosecution of a commonly owned and related patent application, which resulted in US. Pat. No. 4,916,513 (the '513 patent.)
The '800 and '513 patents matured from a common ancestor application; Serial No. 05/154,300 (the '300 application). The '800 patent is directed to a method for making a semiconductor device with PN junctions and with isolation grooves used to separate regions of the device. All claims of the '800 patent include at least one of the following limitations:
1. the bottom of the groove must be within 0.1 micron of the PN junction (the 0.1 micron limitation); and
the PN junction must meet the groove at a curved portion of the groove (the rounding limitation).2. The related '513 patent covers subject matter similar to that of the '800 patent, but its claims are directed to semiconductor structures. In the application that resulted in the '513 patent, all of the claims included either the 1.0 micron limitation, the rounding limitation or both.
During the prosecution of the application for the '513 patent, Li attempted to eliminate three prior art references, Peltzer, Murphy and Sanders, which had been cited and applied by the Examiner, asserting priority under §120 based on an application that was a common ancestor to the '300 application. The Board rejected Li’s priority claim.
During the prosecution of the application for the '800 patent, Li was confronted with the same prior art and again asserted the same priority claim but did not disclose to the Examiner the earlier Board decision. The Examiner accepted Li’s priority claim, withdrew the rejection and allowed the claims.
After a bench trial on the inequitable conduct issue, the district court held the '800 patent unenforceable, finding (1) that Li had not adequately disclosed the Board decision in the prosecution of the application for the '800 patent, and (2) that Li had committed inequitable conduct by affirmatively and repeatedly arguing to the Examiner during the prosecution of the application for the '800 patent that his claims were entitled to the benefit of the earlier filing date. The district court found that the materiality requirement was met because the Examiner allowed the claims only after he was convinced that Li was entitled to the earlier filing date.
The Federal Circuit affirmed. The Court reasoned that, "[P]articularly in a case such as this, in which an applicant’s misrepresentation and nondisclosure of priority date information eliminates a reference specifically cited by the examiner and previously found by the Board to disclose an important feature of the claimed invention, there is no doubt that such information is highly material." The Court inferred deceptive intent from Li’s numerous assertions that were contrary to the Board decision.
Specification Can Limit Even Structural Recitations to a Single Disclosed Embodiment
By Christopher D. Bright
The Federal Circuit has recently held that a functional claim limitation, even if not a §112, ¶6 claim element, may be limited to the single structure described in the specification for performing the function. Watts v. XL Systems, Inc., Case No. 99-1526, 2000 U.S. App. Lexis 28849 (Fed. Cir. Nov. 14, 2000).
The claims at issue are directed to joints, or couplings, for oil well pipes, which have novel sealing and strength properties. The claim limitation at issue recites "tapered external threads dimensioned such that one such joint may be sealingly connected with another such joint."
The District Court construed the functional recitation "sealingly connected" as a §112, ¶6 claim element, or alternatively, as a functional statement limited by the specification and prosecution history to the only disclosed embodiment. Based on this claim construction, the District Court held that the claims were not infringed.
The Federal Circuit reversed the lower court claim construction in part, holding that the limitation in issue was not a §112, ¶6 claim element but agreed with the lower court’s finding regarding infringement. The Court found that §112, ¶6 presumptively did not apply to the subject limitation which does not recite a "means" for performing a function and because "the claim limitation recites or refers to terms that are reasonably well understood in the art as names for structure and which perform the recited function of sealing."
However, the Court went on to hold that the "sealingly connected" claim language was limited to misaligned taper angle structures. Finding the language "dimensioned such that" to not be clear on its face, the Court looked to the specification for clarification. In doing so the Court determined that the specification describes a particular embodiment as the invention and distinguishes it over the prior art. The only structure described in the specification to achieve a sealing connection was tapered internal and external threads. The Court rejected the patentee’s arguments that one skilled in the art would recognize other structures for achieving the connection, and that the specification only used permissive language as to the use of tapered threads, noting that the patentee generally distinguished over the prior art on the basis of this structure.
