IN THIS ISSUE
- Rule Changes -18-Month Publication of Applications| Optional Inter Partes Reexamination Proceedings| Patent Term Adjustment
- Patent/E-Commerce - PTO to Review E-Commerce Patent Applications
- Patent/Inequitable Conduct - Semiconductor Patent Rendered Unenforceable for Misrepresentations
- Patent/Anticipation and Written Description - Description of Various Combinations of Ranges Satisfies Written Description Requirement for Specific Compositions
- Patent/Claim Construction - Signal Structure and 35 USC 112(6) Equivalents
- Patent/Claim Construction - Equivalent Structure Under § 112 ¶6: Two Additional New Decisions
- Patent/Litigation - Sanctions Upheld for Unfounded Claims Infringement
18-Month Publication of Applications
By Wesley L. Strickland
New rules have been proposed to 37 CFR Parts 1 and 5 to implement the 18-month publication of patent applications as provided by the American Inventors Protection Act of 1999.
Under new rules 1.11 through 1.14, open to public inspections are files of an abandoned published application; assignment records of published patent applications; patent application publication records; and, abandoned applications identified in a patent application publication or an application incorporated by reference in a patent application publication.
According to new rule 1.85, if an Office Action contains an objection to the drawings, a reply that does not correct the objection will be considered non-responsive.
Under new rule 1.138, a petition for express abandonment to avoid publication will be denied when it is not recognized in time to avoid publication; four weeks prior to the date of publication is identified as the minimum time period required by the office.
Under new rule 1.211, applications under 35 USC 111(a) and international applications in compliance with 35 USC 371 will be published 18 months from the earliest filing date for which a filing date benefit is sought. Design applications, provisional applications, applications under a secrecy order and applications recognized by the office as "no longer pending" will not be published. Applicants who passively wait for the office to recognize an application as abandoned, rather that expressly abandoning the application, bear the risk that the change in status is not recognized in time to avoid publication.
Under new rule 1.213, an applicant may request an application not to be published which has not and will not be filed in another country. The request must be submitted "upon filing" and can be rescinded at any time. Filing of a foreign application related to an application subject to a nonpublication request will result in the abandonment of the application unless the applicant notifies the office within 45 days of filing the foreign application. Revival on the basis of unintentional delay is available.
According to new rule 1.215, patent application publication will not reflect the application as amended during the examination process, but will reflect the application only as filed. Provisions are included in the new rules for adding changes made during examination as well as assignee information.
According to new rule 1.217, if a foreign or international application has been filed that includes an invention description less extensive than the U.S. application, then the Applicant can submit, for publication, a redacted copy of the application which eliminates the part of the description not also contained in the corresponding foreign application. The redacted copy must be filed within 16 months of the earliest filing date for which benefit is sought or the entire description will be published.
Under new rule 1.219, an applicant can request the office to publish an application before expiration of the 18-month period.
Under new rule 1.221, applicants may submit the required fee and request publication of applications filed before, but pending on, November 29, 2000, and also request republication of applications previously published. No fee is required for a republication request, made within two months of publication, predicated upon a material mistake made by the office.
According to new rule 1.311, the fee for publication will be specified in the notice of allowance and must be paid within three months of the notice of allowance mailing date to avoid abandonment of the application.
Optional Inter Partes Reexamination Proceedings
By William D. Pegg
The proposed reexamination provisions allow inter partes reexamination at any time during a period of enforceability of a patent issuing from an original application filed on or after November 29, 1999.
An inter partes request for reexamination requires, in addition to evidence raising and supporting a substantial new question of patentability, identification of the real party in interest and certification that the third-party requestor is not estopped from the request. An examiner different from the one responsible for the initial patentability determination will ordinarily consider the request within three months and issue an Order for Reexamination if a substantial new question of patentability exists. The patent owner must inform the office of any prior or concurrent proceedings involving the patent and the outcome thereof.
The patent owner has 30days to file a response to any Office Action on the merits addressing issues raised therein. Each time the patent owner files a response, the third-party requester has one opportunity to file written comments limited to issues raised in the Office Action or patent owners’ response within a non-extendable 30-day period from the date of receipt of such response. An Office Action closing prosecution may set different periods for responding. A patent owner may file a request for extension of time on or before the action due date if supported by a showing of sufficient cause, or, if it is too late to request an extension of time, may file a petition to revive with a showing of unavoidable or unintentional delay.
The examiner will consider comments from the patent owner and third-party and shall reopen prosecution or issue a Right of Appeal Notice. This allows the patent owner and third-party requestor to file a notice of appeal or cross appeal to the Board of Patent Appeals and Interferences (hereinafter "the Board"). Appellant briefs filed by the patent owner or third-party requestor must be filed within two months (non-extendable) from the latest of the filing date of the last-filed notice of appeal/cross appeal or expiration of a time for filing such appeal/cross appeal. Respondent briefs must be filed within one month (non-extendable) from receipt of an appellant brief. The examiner considers the submitted brief(s) and issues an Examiner’s Answer. Rebuttal briefs to the Examiner’s Answer must be filed within one month (non-extendable) from the date of the Examiner’s Answer.
Although a patent owner not satisfied with the Board’s decision may request a rehearing or appeal to the U.S. Court of Appeals for the Federal Circuit, a third-party requester cannot appeal the Board’s decision.
Patent Term Adjustment
By Scott D. Paul
Rule changes will provide patent term adjustment to compensate patentees for certain delays in the application examination process. These provisions will apply to applications, other than design patents, filed on or after May 29, 2000, and will provide extensions of patent terms beyond the current term of 20 from the filing date of the application. The extensions will be added on a day-by-day basis, and will be granted due to certain examination delays. The period of adjustment is the sum of the number of days:
1) between the date 14 months after application filing date and the mailing date of a first office Action or a notice of allowance;
2) between the date four months after the date of a reply and the mailing date of a subsequent office Action or a notice of allowance; and
3) between the date four months after the date the issue fee was paid and the date a patent was issued.
Subject to numerous exceptions, extensions are also available for time beyond three years from filing that a patent application failed to issue. Other extensions are available for delays due to an interference proceeding, a secrecy order or successful appellate review.
The period of adjustment is reduced by the time the applicant failed to engage in reasonable efforts to conclude prosecution. This time includes the cumulative total of any periods of time in excess of three months that are taken to reply to any notice or action by the office. Other conduct by the applicant that will reduce the period of adjustment include:
1) late paying of the issue fee;
2) converting of a provisional application to a nonprovisional application;
3) failing to file the basic filing fee, or an oath or declaration;
4) failing to file an application with a specification, abstract and drawings in compliance with the Patent Office rules;
5) submitting a preliminary amendment or other preliminary paper less than one month before the mailing of an office Action or a notice of allowance;
6) submitting a reply having an omission or a supplemental reply;
7) filing an amendment or other paper after a notice of allowance; and
8) further prosecution via a continuing application.
An exception to all of the adjustments is that if overlap exists between the periods of delays, the adjustment will not exceed the actual number of days the issuance of the patent was delayed. Also, no patent can be extended beyond the expiration date of a term that has been disclaimed.
PTO to Review E-Commerce Patent Applications
By Paul Devinsky
The U.S. Patent and Trademark Office (PTO) will add a second layer of review and other quality control improvements for applications in the field of electronic commerce-based business methods.
In the wake of State Street Bank and Trust v. Signature Financial Group, 149 F.3d 1368, (Fed. Cir. 1998) which held that a mutual fund processing system constitutes a useful application of a mathematical algorithm and is entitled to patent protection, a boom has occurred in patent applications for business method-related software. According to the Commissioner, the number of patents issuing in Class 705 (the classification for business method related patents) rose from just under 1,300 in 1998 to 2,600 in 1999.
The second-level review of allowed applications in Class 705 will involve a different examiner than the issuing examiner. Applications will be re-assessed in terms of the search, the statement of reasons for allowance, and the scope of the allowed claims.
For all cases classified in Class 705, the mandatory search will include a classified U.S. patent document search and a text search of U.S. patent documents, foreign patent documents, and non-patent literature. Non-patent literature searches will include required search areas mapped or correlated to the U.S. patent classification system.
The sampling size for quality review will also be substantially expanded, and a new in-process review of office actions will be introduced with an emphasis on the field of search and patentability determinations under the standard of novelty and nonobviousness.
The PTO will enhance technical training for examiners and continue current training efforts and partnerships with industry associations and various individual corporate sponsors.
According to the Commissioner, "The quality of the patent depends very heavily upon what comes into our office. . . . It is not just our job to search for prior art. It’s also your job to make sure you are disclosing to us the most material prior art to which you are aware."
Practice Hint: As the Intellectual Property Group at McDermott, Will & Emery has been recommending for some time, when filing business method patent applications, in order to "shore up" the presumption of validity which attaches to issued patents, applicants are well advised to go beyond compliance with the PTO duty of disclosure requirements and affirmatively seek out the best prior art for citing in the prosecution history.
Semiconductor Patent Rendered Unenforceable for Misrepresentations
By Paul Devinsky
A semiconductor patent was held unenforceable for inequitable conduct, including misrepresentations by the patent holder to the Patent and Trademark Office (PTO). Semiconductor Energy Laboratory Co. v. Samsung Electronics Co., Case No. 98-1377, Fed. Cir. March 2, 2000.
Plaintiff, Semiconductor Energy Laboratory Co. (SEL), is a Japanese company specializing in the research and development of semiconductor technology. SEL owns Patent No. 5,543,636 (the "'636 patent"), directed to a type of insulated gate semiconductor transistor (an FET). SEL filed suit in the U.S. District Court for the E.D. Va. against Samsung alleging that Samsung’s active matrix displays infringed three of SEL’s patents, including the '636 patent.
Samsung’s defenses included an allegation of inequitable conduct regarding the '636 patent. SEL moved for summary judgment on Samsung’s inequitable conduct defense. The district court denied the motion.
After a bench trial, the trial court held the '636 patent unenforceable for inequitable conduct citing facts demonstrating SEL’s intent to deceive the PTO, including misleading statements regarding one prior art article and submission to the PTO of a partial translation of a second article. On a motion for reconsideration, the district court issued a new opinion correcting its discussion regarding the article in question, but still held that misrepresentations in connection with the prosecution of an earlier patent application provided an alternative basis for finding the '636 patent unenforceable. Both sides appealed.
The Federal Circuit, relying on an "infectious unenforceability" theory, found no clear error in the District Court’s findings regarding materiality and intent. With regard to materiality, the Federal Circuit found that the first article, considered with a complete translation of the second article, would not have been cumulative with the prior art considered by the PTO and would have rendered the '636 patent invalid for obviousness. With regard to intent, the Federal Circuit adopted the district characterization that "the record as a whole reflects a clear pattern and practice of initial disclosure, followed by incremental disclosure only when compelled by circumstances to do so, followed, at times, by mischaracterization." The Federal Circuit discounted SEL’s argument that the PTO does not and should not require applicant to submit complete translations of all foreign language references as "missing the point":
"The duty at issue in this case is one of candor, not a duty of translation. The duty of candor does not require that applicant translate every foreign language reference, but only that applicant refrain from submitting partial translations and concise explanations that it knows will misdirect the examiner’s attention from the reference’s relevant teachings."
The Federal Circuit concluded that the District Court did not abuse its discretion in finding that the '636 patent was unenforceable because of SEL’s inequitable conduct in providing misleading and incomplete information in its applications.
Description of Various Combinations of Ranges Satisfies Written Description Requirement for Specific Compositions
By Bernard P. Codd
The written description requirement does not demand a description identical to claimed compositions. Required only is disclosure sufficient to show one of skill in the art that the inventor invented what is claimed. Union Oil Co. of Cal. v. Atlantic Richfield Co., No. 99-1066 (Fed. Cir. March 29, 2000).
The appellants, Atlantic Richfield Company and several other oil companies, filed a declaratory judgment suit against Unocal, alleging that U.S. Patent No. 5,288,393 is invalid for anticipation, obviousness and lack of written description. Unocal counterclaimed for willful infringement. After a jury verdict in favor of Unocal, the appellants filed motions for a Judgment as a Matter of Law (JMOL), which were denied. On appeal, appellants asked the Federal Circuit to consider the issues of anticipation and lack of written description.
Each claim began either with the preface "[a]n unleaded gasoline fuel suitable for combustion in an automotive engine" or "[a]n unleaded gasoline fuel suitable for combustion in a spark ignition automotive engine." Also, the claims at issue were directed to various gasoline compositions, none of which were originally presented in the application.
The Federal Circuit agreed with the district court that the claims covered only standard automotive gasoline compositions and excluded a broader class of petroleum formulations. The Federal Circuit thus affirmed the district court’s determination that specialty fuels, such as aviation and racing fuels, which otherwise met the claim limitations, do not anticipate the claims.
On the issue of lack of written description, the Federal Circuit found that the specification contained a written description adequate to support the claims, despite no disclosure of a specific embodiment corresponding to any of the claims. The court found that the specification and its general teaching of how to vary fuel constituents would have conveyed with reasonable clarity to a person skilled in the art that the inventors were in possession of the claimed invention.
"Artisans skilled in petroleum refining . . . are aware of the properties of raw petroleum sources and know how to mix streams of such sources to achieve a final product with desired characteristics. Thus the patentee in this case taught the desired characteristics of the final automotive fuels, realizing that those of skill in this art know that those characteristics define the claimed products."
Signal Structure and 35 USC 112(6) Equivalents
By Jennifer C. Chen
A means-plus-function claim element relating to the shape of an electrical signal may be infringed under the doctrine of equivalents. Optical Disc Corp. v. Del Mar Avionics, No. 99-1225 (Fed. Cir., April 7, 2000).
The claims in Optical Disc Corp. were directed to a method and apparatus for improving the quality of CDs by creating masters having pits with geometrically symmetrical leading and trailing edges. The district court, ruling on Del Mar’s motion for summary judgment, found that there was no infringement, literal or by equivalents. The critical claim limitation was a recitation that the modulator drive signal has "ramped trailing edges." The modulator drive signal controls the laser beam which etches pits in order to "write" on a master CD. The Del Mar system used a double-stepped trailing edge modulator drive signal.
The Court construed the drive signal limitation to require "a drive signal pulse trailing edge which moderates its decrease in laser power from a write level to a base level, over time, to produce a less abrupt passage through the thermal threshold of the moving medium," rejecting the construction urged by Del Mar to require a signal that "increases or decreases smoothly from one level to another."
The Federal Circuit affirmed the lower court ruling of no literal infringement. Regarding infringement under the doctrine of equivalents, the Court considered evidence that the trailing edge double-step waveform of the accused device was equivalent to the claimed ramped trailing edge waveform. This is because the "function [of the trailing edge double-step waveform] is to change the thermal profile at the ablative surface of the dye-polymer disc master in the region of the trailing edge of the pit being formed in that surface, by means of progressively reducing the energy delivered to that surface in that region, to result in controlling the shape of the trailing edge of that pit" (emphasis in original). With this evidence, (an expert declaration), the Court concluded that a reasonable jury could find infringement by equivalents.
Equivalent Structure Under § 112 ¶6: Two Additional New Decisions
By Paul Devinsky and D. Sean Trainor
Two additional recent decisions of the Federal Circuit render the § 112, ¶ 6 landscape a bit confused. In one case, a panel of the Federal Circuit held that the determination of equivalent structures for purposes of finding literal infringement of a § 112, ¶6 claim element must take into account the context of the invention. IMS Technology Inc. v. Haas Automation Inc., Nos. 99-1019 -1067, (Fed. Cir., 3/27/00). Less than two weeks later, another panel made no mention of the "context of invention" in determining that an accused device did not infringe a § 112, ¶ 6 claim element, either literally or under the doctrine of equivalents, applying a strict Chuminatta-type analysis. Kemco Sales, Inc. v. Control Papers Co., Inc., No. 99-1349 (Fed. Cir. Apr. 7, 2000).
The IMS case involved a patent (U.S. Pat. No. 4,477,754) on a machine tool numerical control, which runs a program containing a series of numerical instructions and converts the instructions to electrical control signals applied to servo motors that control the movement of a machine tool along various axes. The specification described a tape cassette transport for performing the function of a claimed "interface means." Because the Haas control used a floppy disk drive, the district court, relying on the Chuminatta decision, found no literal or equivalents infringement.
On appeal, the Federal Circuit found that the disk drive of the Haas system performs the function of the recited "interface means" but uses a different structure than the corresponding structure in the patent specification. Thus, the issue was whether the disk drive used in the Haas system was a structural equivalent to the disclosed tape cassette transport.
The Court remanded, explaining that a "reduced version" of the tripartite function-way-result test is used to determine whether the differences between the accused and claimed devices are insubstantial for equivalents under § 112, ¶ 6. The court further held that, just as in a doctrine of equivalents determination, the context of the invention should be considered.
Regarding equivalence between the Haas floppy disk drive and the disclosed tape cassette transport, the Court noted:
". . . IMS has provided some evidence of structural similarities between a floppy disk drive and a tape cassette transport, and, while there are admittedly physical differences, there is at least an issue of fact as to whether those differences are substantial in light of the role played by the 'interface means' in the claimed invention."
The Kemco case involved a patent directed to a plastic security envelope that indicates when its integrity has been breached, i.e., it is "tamper-evident". The tamper-evident envelope employs two sealing means — one acts as the primary closing mechanism for the envelope and the other indicates if an attempt has been made to open the envelope.. The tamper-evident sealing structure is comprised of a fragile, temperature-sensitive and adhesive backing material.
The district court, after construing the "sealing" means element of the claim at issue, granted Control Papers' partial summary judgment motion of non-infringement. On appeal, based on the written description and the drawings, the panel ruled that the "sealing means" was a "plastic, fold-over flap that is secured to the outside of one or both panels of the envelope."
The panel further held that a dual-lip structure utilized by the accused devices for closing the envelope was not the same as the fold-over flap structure disclosed in the patent. Using a "modified function-way-result" test, the court held that the accused devices did not implement an "equivalent" structure within the meaning of § 112, ¶ 6, because the structure of the accused device operates in a substantially different way to yield a substantially different result. The two sealing means of the disclosed structure in the patent are attached to the outside of the envelope, whereas, in the accused devices, the sealing means is attached internally to the lips of the dual-lip structure.
Based on this analysis, the accused devices could not infringe under the doctrine of equivalents, because "[w]hen a court determines that the "way" and/or "result" is/are substantially different under a section 112, paragraph 6 equivalents analysis, a patentee cannot prevail under the doctrine of equivalents for the same reason(s)."
Sanctions Upheld for Unfounded Claims Infringement
By Paul Devinsky
The Federal Circuit recently upheld an award of sanctions against a law firm under Rule 11 for filing infringement counterclaims without first conducting a "reasonable inquiry" into the relevant facts. View Engineering Inc. v. Robotic Vision Systems Inc., No. 99-1399, Fed. Cir., 3/31/00. In so doing, the Federal Circuit upheld a $98,000 sanction award, explaining that a pre-filing infringement analysis plays a key role in determining the reasonableness of the pre-filing inquiry made in a patent infringement case. The court was not persuaded by the argument that the law firm had inadequate access to the accused device before it was able to engage in discovery.
View Engineering (View) and Robotic Vision Systems (Robotic) compete in the field of three-dimensional vision technology. View sued Robotic for a declaratory judgment of invalidity and noninfringement. Robotic counterclaimed that View infringed eight of its patents, relying on the belief of Robotic's vice president that View’s device would probably infringe, although he had not seen View’s machines. Robotic later determined that there was no infringement with respect to five of those patents and withdrew its infringement charge as to them. View then moved for sanctions under Fed.R.Civ.P. 11(b) against Robotic and its counsel.
Robotic admitted that it had no factual basis for its counterclaims, but maintained that the complexity of the machines at issue precluded an infringement determination based on a visual inspection and that Robotic refused to permit View to examine its machines.
The court noted that counsel for Robotic performed no independent claim construction analysis and completed no formal written infringement analysis before filing the counterclaims. Further, the Court noted that View was not required to engage in the voluntary pre-litigation discovery that Robotic requested, or any discovery not approved by the court:
"Before filing counterclaims of patent infringement, Rule 11, we think, must be interpreted to require the law firm to, at a base minimum, apply the claims of each and every patent that is being brought into the lawsuit to an accused device and conclude that there is a reasonable basis for a finding of infringement of at least one claim of each patent so asserted. The presence of an infringement analysis plays the key role in determining the reasonableness of the pre-filing inquiry made in a patent infringement case under Rule 11. [The law firm] performed neither a formal nor an informal analysis of any sort. This cannot be found to be a reasonable inquiry for the purpose of filing patent infringement claims."
Practice Hint: While the Robotic Vision case arose in the context of patent infringement counterclaims by a DJ defendant, this case demonstrates that a patent owner/plaintiff must be able to demonstrate to a court that it has a reasonable chance to succeed on the merits if called on to do so, or face Rule 11 sanctions.