IP Newsflash - May 2015 #5

SUPREME COURT CASES
Invalidity is not a Defense to Infringement but a Defense to Liability

This week, on May 26, 2015, the Supreme Court held in Commil USA, LLC v. Cisco Systems, Inc. that a defendant’s good-faith belief in the invalidity of the patent-in-suit is not a defense to induced infringement under 35 U.S.C. § 271(b). Justice Kennedy, writing for the majority, emphasized that invalidity is not a defense to infringement but a defense to liability, and that a good-faith belief of invalidity cannot negate the scienter required for induced infringement. In so holding, the Court reversed the Federal Circuit’s finding that evidence of a defendant’s good-faith belief of invalidity may negate the intent needed for an inducement claim.

In reaching its 6-2 decision, the Court also affirmed its prior decision in Global-Tech that induced infringement requires both (1) knowledge of the asserted patent and (2) knowledge that the actions induced constitute infringement. In doing so, the Court rejected Commil’s and the government’s argument that a defendant only needs to know of the patent to have the requisite intent for inducement. According to the Court, to rule otherwise would lead to an erroneous conclusion in induced and contributory infringement cases in which an accused infringer could be liable even though he did not know the induced or contributory acts were infringing.

The Court’s reasoning for its holding focused on the distinction between patent infringement and patent validity as two separate issues. The Court noted that “the scienter element for induced infringement concerns infringement; that is a different issue than validity. … Because infringement and validity are separate issues under the [Patent] Act, belief regarding validity cannot negate the scienter required under § 271(b).”

In reaching its decision, the majority laid out its support that validity and infringement are distinct issues under the law. First, the Court cited its own precedent that distinguished the two issues, noting that “seeking a declaratory judgment of invalidity presents a claim independent of a patentee’s charge of infringement,” that noninfringement and invalidity are considered “alternative grounds” to dismissing a suit, and that an accused infringer may defeat liability by proving either noninfringement or invalidity. Next, the Court pointed out that infringement and validity appear in separate parts of the Patent Act, and that an accused infringer may prevail by either attacking the validity of the patent or defending against infringement. The Court warned that the good-faith defense of invalidity would conflate the issues of infringement and invalidity. Finally, the Court reiterated that a patent is presumed valid, and “if at the end of the day, an act that would have been an infringement or an inducement to infringe pertains to a patent that is shown to be invalid, there is no patent to be infringed.”

Justice Scalia, joined by Chief Justice Roberts, argued in dissent that a would-be defendant who has a good faith basis to believe that a patent is invalid should be free to act without liability regarding inducement because “[t]o talk of infringing an invalid patent is to talk nonsense.” They pointed out that “it is impossible for anyone who believes that a patent cannot be infringed to induce actions that he knows will infringe it.” The justices argued that the “presumption of validity is not weakened by treating a good-faith belief in validity as a defense to induced infringement [because a]n alleged inducer who succeeds in this defense does not thereby call a patent’s validity into question [but] avoids liability for a third party’s infringement of a valid patent.” Both justices believe that the majority opinion “increases the in terrorem power of patent trolls.”

Commil USA LLC v. Cisco Sys., Inc., 2015 U.S. LEXIS 3406, Case No. 13-896, U.S. Supreme Court (May 26, 2015) (J. Kennedy).

- Author: Alex Chan
 
DISTRICT COURT CASES
Trial Court Enters JMOL of Non-Infringement for Dropped Patents and Dropped Claims

In the Western District of Washington, the judge entered judgment as a matter of law of non-infringement for the defendant’s counterclaim of non-infringement for 30 claims from five patents that the plaintiff dropped before the jury trial. The judge found that although the plaintiff dropped the patents and claims, the defendant did not amend its counterclaim of non-infringement, entitling it to judgment as a matter of law (JMOL) of non-infringement.

The plaintiff, Eagle Harbor Holdings, originally sued Ford Motor Company for patent infringement of 117 claims of 11 different patents. After two years of litigation, the court ordered Eagle Harbor to reduce the number of asserted claims to 35. In the joint pre-trial statement, Eagle Harbor further reduced the asserted claims to 26 claims over the 9 patents. Finally, on the weekend before trial, Eagle Harbor informed Ford that it would only present five claims for four patents to the jury—dropping the other five patents.

In entering the JMOL, the court noted that other district courts are split on how to handle the issue of counterclaims of non-infringement for patents and claims that are dropped over the course of litigation (citing an E.D. Tex. and a Delaware decision). Ultimately, the court found that Ford was entitled to JMOL because, although Eagle Harbor dropped most of the claims before trial, Ford did not drop its counterclaims. The court found that because it had ordered Eagle Harbor to reduce its claims to 35, “it would be fundamentally unfair and plain error” to enter judgment against all of the 117 originally asserted claims, but instead would limit JMOL to the reduced 35 claims.

The court’s decision will likely attach res judicata to all claims of the five patents dropped on the eve of trial, even though they were not presented to the jury—meaning the plaintiff will not be able to assert those patents in a separate lawsuit against Ford. Eagle Harbor may also be barred from asserting those five patents against Ford’s customers and suppliers. Thus, the court’s decision warrants special attention to both plaintiffs and defendants as cases are narrowed throughout the course of litigation. Both parties should be aware whether dropping claims will have preclusive effects, especially if related pleadings are not amended.

Eagle Harbor Holdings, LLC, v Ford Motor Company, C.A. No. 3:11-cv-5503 (W.D. Wash.).

- Author: Michael Reeder

 
District Court Grants Motion to Dismiss Because Internet-Related Patent Fails to Claim Patentable Subject Matter Under 35 U.S.C. § 101

On May 15, 2015, the Northern District of Texas granted a motion to dismiss because the asserted patent only claims unpatentable subject matter under 35 U.S.C. § 101. The asserted patent (U.S. Patent No. 5,987,606) is directed toward a method and system for filtering Internet content in a manner that is customizable for each Internet user. To determine whether the asserted patent fails to claim patentable subject matter under § 101, the court applied the Federal Circuit’s two-step Alice test.  

Under step one of the Alice test, a court determines whether the patent is directed toward an abstract idea. Here, the court found that the asserted patent is directed toward the abstract idea of “filtering Internet content.” The court determined—with the support of recent Federal Circuit precedent—that “the abstract idea of filtering content” is “a long standing, well-known method of organizing human activity.” The court placed little weight on the fact that the claims are limited to filtering Internet content, finding that “content provided on the Internet is not fundamentally different from content observed, read, and interacted with through other mediums like books, magazines, televisions, or movies, all of which had to grapple with filtering complications similar to those addressed by the claims of the ’606 Patent.”

Under step two, a court considers the elements of the claims, both individually and as an ordered combination, to determine whether any additional elements “transform the nature of the claim.” The second step is essentially a search for an “inventive concept” in the claims. Here, the court determined that the asserted patent fails to claim the necessary inventive features for a patent-eligible invention. The court found there was “little dispute” that the featured claim elements—a “local client computer,” “remote ISP server,” and “Internet computer network”—are well known components of a generic computer system and failed to provide any inventive concepts. Also, the claimed “filtering schemes” failed to transform the claims into patent-eligible material because the specification discloses that these schemes can be “any type” of executable code. The court’s primary concern with the asserted patent was that “the absence of structure for the generic computer elements of the claims raises the likelihood that such claims could preempt every filtering scheme under the sun.” Thus, the court held both steps were met under Alice and the asserted patent failed to claim patentable subject matter under § 101. 

Bascom Global Internet Servs. v. AT&T Mobility LLC, No. 3:14-cv-3942-M (N.D. Tex. May 15, 2015) (Lynn, J.).

- AuthorJamie Duncan
 
PATENT TRIAL AND APPEAL BOARD
Mere Possibility of Claimed Feature is Insufficient to Institute Inter Partes Review

In ABS Global, Inc. v. Inguran, LLC, IPR2015-0001, the Patent Trial and Appeal Board (PTAB) denied institution of an inter partes review (IPR), finding that, for a §§ 102 or 103 rejection, the mere possibility of a claimed feature in the prior art was insufficient to show a reasonable likelihood that the petitioner would prevail at trial.

The challenged patent, U.S. Patent 8,206,987 (the “’987 patent”), is directed to methods for sorting delicate sperm cells to produce an enriched population of cells with a certain desired characteristic, such as an X or Y chromosome. In general, the methods disclosed in the patent involve staining a sample population of sperm cells with a fluorescent dye, flowing the stained cells in a fluid stream past an excitation laser and photodetector to detect the amount of fluorescence emitted from the cells, which varies depending on the sex chromosome of the sperm cell, and photo-damaging the undesired cells to produce an enriched population of sperm cells with the desired sex characteristic. The petitioner argued that the ’987 patent was anticipated by Keij, which the board characterized as disclosing “a high-speed cell sorter . . . for ablating murine and human progenitor cells, and other rare cells, such as stem cells from bone marrow grafts.” For the ’987 claim limitations pertaining specifically to sorting delicate sperm cells, the petitioner pointed to one sentence in Keij stating that “sorting of X or Y chromosome bearing sperm cells . . . is an interesting possibility.” The board determined that this statement did not disclose “with anticipatory specificity” an example of a method of sperm sorting, “much less a method that produces an ‘enriched population of sperm.’” The board also found that this statement was insufficient to show a likelihood of prevailing at trial on the issue of obviousness. In particular, the board observed that sperm cells were known in the art as extremely delicate cells, and that the petitioner failed to set forth evidence that one skilled in the art would have expected the sperm to survive the process, compared to more robust cells. The board concluded that “Keij’s disclosure, that applying photo-damage sorting to sperm cells ‘is an interesting possibility,’ is too slender a reed to support such an inference.” Accordingly, the board found that the petitioner failed to show a reasonable likelihood that it would prevail at trial on the grounds of anticipation or obviousness and, therefore, denied the petition and declined to institute inter partes review.

ABS Global, Inc. v. Inguran, LLC, IPR2015-0001, Paper No. 12 (P.T.A.B. April 29, 2015).

- Author: Joe Young

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Akin Gump Strauss Hauer & Feld LLP | Attorney Advertising

Written by:

Akin Gump Strauss Hauer & Feld LLP
Contact
more
less

Akin Gump Strauss Hauer & Feld LLP on:

Readers' Choice 2017
Reporters on Deadline

Related Case Law

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide

JD Supra Privacy Policy

Updated: May 25, 2018:

JD Supra is a legal publishing service that connects experts and their content with broader audiences of professionals, journalists and associations.

This Privacy Policy describes how JD Supra, LLC ("JD Supra" or "we," "us," or "our") collects, uses and shares personal data collected from visitors to our website (located at www.jdsupra.com) (our "Website") who view only publicly-available content as well as subscribers to our services (such as our email digests or author tools)(our "Services"). By using our Website and registering for one of our Services, you are agreeing to the terms of this Privacy Policy.

Please note that if you subscribe to one of our Services, you can make choices about how we collect, use and share your information through our Privacy Center under the "My Account" dashboard (available if you are logged into your JD Supra account).

Collection of Information

Registration Information. When you register with JD Supra for our Website and Services, either as an author or as a subscriber, you will be asked to provide identifying information to create your JD Supra account ("Registration Data"), such as your:

  • Email
  • First Name
  • Last Name
  • Company Name
  • Company Industry
  • Title
  • Country

Other Information: We also collect other information you may voluntarily provide. This may include content you provide for publication. We may also receive your communications with others through our Website and Services (such as contacting an author through our Website) or communications directly with us (such as through email, feedback or other forms or social media). If you are a subscribed user, we will also collect your user preferences, such as the types of articles you would like to read.

Information from third parties (such as, from your employer or LinkedIn): We may also receive information about you from third party sources. For example, your employer may provide your information to us, such as in connection with an article submitted by your employer for publication. If you choose to use LinkedIn to subscribe to our Website and Services, we also collect information related to your LinkedIn account and profile.

Your interactions with our Website and Services: As is true of most websites, we gather certain information automatically. This information includes IP addresses, browser type, Internet service provider (ISP), referring/exit pages, operating system, date/time stamp and clickstream data. We use this information to analyze trends, to administer the Website and our Services, to improve the content and performance of our Website and Services, and to track users' movements around the site. We may also link this automatically-collected data to personal information, for example, to inform authors about who has read their articles. Some of this data is collected through information sent by your web browser. We also use cookies and other tracking technologies to collect this information. To learn more about cookies and other tracking technologies that JD Supra may use on our Website and Services please see our "Cookies Guide" page.

How do we use this information?

We use the information and data we collect principally in order to provide our Website and Services. More specifically, we may use your personal information to:

  • Operate our Website and Services and publish content;
  • Distribute content to you in accordance with your preferences as well as to provide other notifications to you (for example, updates about our policies and terms);
  • Measure readership and usage of the Website and Services;
  • Communicate with you regarding your questions and requests;
  • Authenticate users and to provide for the safety and security of our Website and Services;
  • Conduct research and similar activities to improve our Website and Services; and
  • Comply with our legal and regulatory responsibilities and to enforce our rights.

How is your information shared?

  • Content and other public information (such as an author profile) is shared on our Website and Services, including via email digests and social media feeds, and is accessible to the general public.
  • If you choose to use our Website and Services to communicate directly with a company or individual, such communication may be shared accordingly.
  • Readership information is provided to publishing law firms and authors of content to give them insight into their readership and to help them to improve their content.
  • Our Website may offer you the opportunity to share information through our Website, such as through Facebook's "Like" or Twitter's "Tweet" button. We offer this functionality to help generate interest in our Website and content and to permit you to recommend content to your contacts. You should be aware that sharing through such functionality may result in information being collected by the applicable social media network and possibly being made publicly available (for example, through a search engine). Any such information collection would be subject to such third party social media network's privacy policy.
  • Your information may also be shared to parties who support our business, such as professional advisors as well as web-hosting providers, analytics providers and other information technology providers.
  • Any court, governmental authority, law enforcement agency or other third party where we believe disclosure is necessary to comply with a legal or regulatory obligation, or otherwise to protect our rights, the rights of any third party or individuals' personal safety, or to detect, prevent, or otherwise address fraud, security or safety issues.
  • To our affiliated entities and in connection with the sale, assignment or other transfer of our company or our business.

How We Protect Your Information

JD Supra takes reasonable and appropriate precautions to insure that user information is protected from loss, misuse and unauthorized access, disclosure, alteration and destruction. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. You should keep in mind that no Internet transmission is ever 100% secure or error-free. Where you use log-in credentials (usernames, passwords) on our Website, please remember that it is your responsibility to safeguard them. If you believe that your log-in credentials have been compromised, please contact us at privacy@jdsupra.com.

Children's Information

Our Website and Services are not directed at children under the age of 16 and we do not knowingly collect personal information from children under the age of 16 through our Website and/or Services. If you have reason to believe that a child under the age of 16 has provided personal information to us, please contact us, and we will endeavor to delete that information from our databases.

Links to Other Websites

Our Website and Services may contain links to other websites. The operators of such other websites may collect information about you, including through cookies or other technologies. If you are using our Website or Services and click a link to another site, you will leave our Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We are not responsible for the data collection and use practices of such other sites. This Policy applies solely to the information collected in connection with your use of our Website and Services and does not apply to any practices conducted offline or in connection with any other websites.

Information for EU and Swiss Residents

JD Supra's principal place of business is in the United States. By subscribing to our website, you expressly consent to your information being processed in the United States.

  • Our Legal Basis for Processing: Generally, we rely on our legitimate interests in order to process your personal information. For example, we rely on this legal ground if we use your personal information to manage your Registration Data and administer our relationship with you; to deliver our Website and Services; understand and improve our Website and Services; report reader analytics to our authors; to personalize your experience on our Website and Services; and where necessary to protect or defend our or another's rights or property, or to detect, prevent, or otherwise address fraud, security, safety or privacy issues. Please see Article 6(1)(f) of the E.U. General Data Protection Regulation ("GDPR") In addition, there may be other situations where other grounds for processing may exist, such as where processing is a result of legal requirements (GDPR Article 6(1)(c)) or for reasons of public interest (GDPR Article 6(1)(e)). Please see the "Your Rights" section of this Privacy Policy immediately below for more information about how you may request that we limit or refrain from processing your personal information.
  • Your Rights
    • Right of Access/Portability: You can ask to review details about the information we hold about you and how that information has been used and disclosed. Note that we may request to verify your identification before fulfilling your request. You can also request that your personal information is provided to you in a commonly used electronic format so that you can share it with other organizations.
    • Right to Correct Information: You may ask that we make corrections to any information we hold, if you believe such correction to be necessary.
    • Right to Restrict Our Processing or Erasure of Information: You also have the right in certain circumstances to ask us to restrict processing of your personal information or to erase your personal information. Where you have consented to our use of your personal information, you can withdraw your consent at any time.

You can make a request to exercise any of these rights by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to privacy@jdsupra.com. We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to privacy@jdsupra.com.

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at: privacy@jdsupra.com.

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at www.jdsupra.com) (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit legal.hubspot.com/privacy-policy.
  • New Relic - For more information on New Relic cookies, please visit www.newrelic.com/privacy.
  • Google Analytics - For more information on Google Analytics cookies, visit www.google.com/policies. To opt-out of being tracked by Google Analytics across all websites visit http://tools.google.com/dlpage/gaoptout. This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit http://www.aboutcookies.org which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at: privacy@jdsupra.com.

- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.