|
Patent
Law:
Patentable
Subject Matter:
In
re Bernard L. Bilski and Rand A. Warsaw, 2007-1130, ( CAFC
October 30, 2008)
Bilski
filed a patent application claiming a method of hedging
commodity transactions by performing "transactions"
between commodity providers, commodity consumers, and market
participants who have counter-risk positions to the consumers.
The US Patent and Trademark Office ("USPTO")
rejected Bilski's claims, as part of a larger overall policy
shift to limit the scope of patentable subject matter.
The case was appealed to the Court of Appeals for the Federal
Circuit ("CAFC"). The CAFC set forth a
so-called "machine-or-transformation" rule as the
"definitive test" for deciding whether a
"process" claim is patentable subject matter under
35 USC § 101. The CAFC held that a process claim is
patentable under § 101 if either: 1) it is tied to a
particular machine or apparatus, or 2) it transforms a
particular article into a different state or thing.
Applying this test to Bilski's patent claims, the CAFC held
that Bilski's claim was not patentable subject matter because
it did not transform "any article to a different state or
thing." The Court found that the claim
"encompassed the exchange of only options, which are
simply legal rights to purchase some commodity," and that
"transactions involving the exchange of these legal
rights do not involve the transformation of any physical
object or substance, or an electronic signal representative of
any physical object or substance."
Bilski's patent application was filed more than a year before
the CAFC decided State Street Bank, which upheld the
patentability of business method patents under § 101.
As the result of the Bilski decision, many issued patents may
be found invalid if challenged. The subject matter of
patents at risk include database designs, computer languages,
cryptography, compression, financial engineering and signal
processing.
The CAFC left unanswered questions such as whether a
"general purpose computer" would satisfy the
"machine" prong of the patentable subject matter
test. It is also not clear what specifically the Court
meant by stating that a transformation must be "central
to the purpose of the claimed process" and the
"transformation must not constitute mere post-solution
activity."
The CAFC added uncertainty to its holding by stating
"purported transformations or manipulations simply of
public or private legal obligations or relationships, business
risks, or other such abstractions cannot meet the test because
they are not physical objects or substances, and they are not
representative of physical objects or substances."
It is quite probable that the USPTO will treat this statement
as an exclusion of business method claims.
The ultimate result of Bilski may be a significant negative
impact to both patent licensors and to defendants to patent
litigation.
Obviousness:
Kinetic
Concepts et al. v. Blue Sky Medical et al., 2007-1340, (CAFC
February 2, 2009)
After
a six week trial in the United States District Court for the
Western District of Texas, the jury returned a verdict that
the asserted patents were not shown to be invalid,
unenforceable, or infringed. The jury also found against
Kinetic Concepts et al. ("KCI") on its false
advertising, unfair competition, and conspiracy claims.
The issues on appeal focused on six limitations, at least one
of which was present in each of the asserted claims. First,
each of the asserted claims required using “reduced” or
“negative” pressure to “treat a wound” or “facilitate
the healing of a wound,” either as part of the preamble1 or
the body of the claim. Second, there is a “screen” or “screen
means” limitation in each asserted claims. Third, some of
the claims had limitations requiring the use of intermittent
suction. Fourth, an “impermeable cover” limitation is
present in some of the claims. Fifth, some of the claims
contained a limitation requiring treating toward a “selected
stage of healing.” Finally, one claim reciteed “a
reduction in bacterial density in the wound by at least 50%.”
The CAFC found that KCI addressed each of Defendants’ prior
art references and provided the jury with a basis for
determining that they did not teach or suggest “treating a
wound with negative pressure,” a limitation found in every
asserted claim. The Court therefore concluded that there was a
sufficient basis to support the jury's verdict of
nonobviousness.
The Court also held that defendants did not show that a person
of skill in the art would be unable to ascertain the meaning
of the term "selected stage of healing" because
"while it may be true that the patentee’s ability to
“articulate a definition supported by the specification . .
. does not end the inquiry.”
The Court also held that there was no induced infringement on
the grounds that a defendant’s belief that it can freely
practice inventions found in the public domain cannot support
a jury’s finding that the intent required for induced
infringement was lacking.
Based on its holdings, the Court affirmed the district court's
denial of Defendants' motion for JMOL of obviousness and its
determinations that certain claim terms were not indefinite.
The dissenting opinion criticized the majority opinion based
on the majority opinion that the term "wound" means
"tissue damage to the surface of the body, including the
epithelial and subcutaneous layers" because [a]ll of the
examples described in the specification involve skin
wounds." Further, the majority held that the term
“wound” should be understood as limited to damage to
tissues near the surface of the body, particularly the skin,
and should not include damage to organs. The majority pointed
to no medical dictionary or other extrinsic evidence
supporting this claim construction. If the term
"wound" would have been construed broader, then the
prior art of record, according to the dissent, would have
rendered the claims obvious.
Duty
of Disclosure:
Qualcomm
Inc. v. Broadcom Corp., 2007-1545, (CAFC December 1, 2008)
This
case involved the consequence of silence in the face of a duty
to disclose patents in a standards-setting organization (“SSO”).
The district court concluded that Qualcomm breached its duty
to disclose U.S. Patent Nos. 5,452,104 (“’104 Patent”)
and 5,576,767 (“’767 Patent”) to the Joint Video Team (“JVT”)
SSO. As a remedy, the district court ordered the ’104 and
’767 Patents (and related patents) unenforceable against the
world. Additionally, based on both Qualcomm’s JVT misconduct
and its litigation misconduct, the court determined that this
was an exceptional case and awarded Broadcom its attorney
fees.
The CAFC found that many industry participants of SSOs attempt
to avoid “patent hold-up,” which can occur when
participants fail to disclose relevant intellectual property
rights (“IPR”) to an SSO prior to a standard’s adoption,
by requiring participants to reveal and/or give up IPR
covering a standard. The CAFC affirmed the district court’s
determination that Qualcomm, as a participant in the JVT prior
to the release of the standard, did have IPR disclosure
obligations under the written policies of both JVT and its
parent organization. The Federal Circuit, however, held that
remedy of unenforceability against the world was too broad,
and remanded with instructions to enter an unenforceability
remedy limited in scope to H.264-compliant products.
Obviousness:
Boston
Scientific Scimed, Inc. et al. v. Cordis Corporation et al.,
2008-1073, (CAFC January 15, 2009)
This
case involved an infringement suit by Boston Scientific Scimed
against Cordis Corporation based on US Patent 6,120,536
("the '536 patent"), which relates to a drug-eluting
expandable stent with a coating that has a non-thrombogenic
surface. Boston Scientific sued Cordis in March 2003,
alleging, inter alia, that Cordis’s Cypher stent infringed
claim 8 of the ’536 patent.
The district court found the '536 patent to be valid and
infringed.
The CAFC reversed the district court and found the '536 patent
to be obvious in view of a combination of embodiments taken
from a single reference. Moreover, the Court held that
even though Boston Scientific had proven secondary
consideration for non-obviousness through commercial success,
such a secondary consideration does not overcome a strong
prima facie showing of obviousness.
Patentable
Subject Matter:
In
re Stephen W. Comiskey, 2006-1286, (CAFC, January 13, 2009)
This case involved a patent application that claimed a
method and system for mandatory arbitration involving legal
documents, such as wills or contracts. The Board of
Patent Appeals and Interferences affirmed the examiner's
rejection of claims 1-59 of his patent application as being
obvious in view of the prior art and therefore unpatentable
under 35 USC § 103. The CAFC found that the independent
claims and most of their dependent claims were invalid on the
grounds that they were unpatentable subject matter under 35
USC § 101.
The USPTO urged that the CAFC consider the § 101 issue and
the USPTO argued that Comiskey’s independent claims were
directed at an unpatentable abstract idea, and not a
patentable process, because they neither were tied to a
particular machine nor operated to change materials to a
different state or thing. Rather the claims impermissibly “encompasse[d]
a method of controlling how humans interact with each other to
resolve a dispute, based on a human arbitrator’s perception
of the dispute.”
Instead of relying on its recent Bilski decision, the CAFC
held that "although it has been suggested that State
Street Bank supports the patentability of business methods
generally,8 State Street Bank explicitly held that business
methods are “subject to the same legal requirements for
patentability as applied to any other process or method.”, State
Street Bank, 149 F.3d at 1375.
The Court further stated that "as early as Le Roy v.
Tatham, 55 U.S. 156, 175 (1852), the Supreme Court explained
that “[a] principle, in the abstract, is a fundamental
truth; an original cause; a motive; these cannot be patented,
as no one can claim in either of them an exclusive right.”
Since then, the unpatentable nature of abstract ideas has
repeatedly been confirmed. See, e.g., Diehr, 450 U.S. at 185;
Chakrabarty, 447 U.S. at 309; Flook, 437 U.S. at 589; Benson,
409 U.S. at 67; Rubber-Tip Pencil Co. v. Howard, 87 U.S. 498,
507 (1874)."
The Court stated two aspects of the prohibition against the
patenting of abstract ideas:
First, when an abstract concept has no claimed practical
application, it is not patentable.
Second, a claim reciting an algorithm or abstract idea can
state statutory subject matter only if, as employed in the
process, it is embodied in, operates on, transforms, or
otherwise involves another class of statutory subject matter,
i.e., a machine, manufacture, or composition of matter. 35
U.S.C. § 101.
Regarding the second aspect, “[t]he Supreme Court has
recognized only two instances in which such a method may
qualify as a section 101 process: when the process ‘either
[1] was tied to a particular apparatus or [2] operated to
change materials to a ‘different state or thing.’’
Based
on the aspect of prohibition stated, the Court concluded that
Comiskey's independent claims and their dependent claims do
not contain patentable subject matter.
|
