Dennis Crouch's Patently-O: 3 new topics, including “Patent Number Nine Million.” |  |
- Patent Number Nine Million.
- Guest Post: White House “Patent Troll” Report Challenged under the Federal Information Quality Act.
- Patent Law Moot Court: Disembodied Genetic Information as an Abstract Idea
- Federal Circuit Cases to Watch on Software Patentability – Planet Blue
| Posted: 06 Apr 2015 11:01 PM PDT Check out Patent Number 9,000,000 issued on April 7, 2015. Although the first U.S. utility patents were issued in 1790, the current numbering system did not begin until 1836. An additional 9,500 patents issued between 1790 and 1836. About 1/3 of all issued patents are currently in-force – that means that they were issued within the past twenty yea  |
| Guest Post: White House “Patent Troll” Report Challenged under the Federal Information Quality Act. Posted: 06 Apr 2015 06:12 PM PDT By Ron D. Katznelson A letter to Congress from 51 professors of law and economics argues that "the net effect of patent litigation is to raise the cost of innovation and inhibit technological progress." In response, an equally strong letter to Congress from other 40 professors of law and economics expresses "deep concerns with the many flawed, unreliable, or incomplete studies about the American patent system that have been provided to members of Congress." The response letter defends the patent system and notes a pattern of analytical flaws in some studies underlying the 51 professors' letter, listing basic empirical analysis reliability criteria that such studies fail to meet. Are criteria for reliable empirical analysis fungible? Should our patent policy turn on a "they said – they said" contest? The answer must be a resounding NO. It turns out that the government has developed detailed criteria, requirements and standards for reliable empirical analysis and information quality. Because the public disproportionately relies on information disseminated by the government, the government holds itself to substantially higher standards than those used by private parties or non-government entities in disseminating information on the internet or in academic journals, with its high variability in accuracy and reliability. Congress enacted the Information Quality Act ("IQA") in order to ensure that information disseminated by government agencies meet the standards of "quality, objectivity, utility, and integrity." 44 U.S.C. § 3516, note. Information disseminated by the government for reliance by government and the public must be "presented in an accurate, clear, complete, and unbiased manner." The IQA forbids agencies from endorsing or approvingly disseminating information of substandard quality from third-parties. The Office of Management and Budget ("OMB") promulgated guidelines for agencies to comply with the IQA, including the Bulletin for Peer Review and the Standards and Guidelines for Statistical Surveys. These quality standards are quite specific. For example, they set criteria for presentation and substantive balance and objectivity, transparency of data and methods, conditions under which peer-review is required, design of survey frames and sample coverage, minimum survey response rates below which specific bias analyses are required, etc. Virtually all government agencies, including the Executive Office of the President, are subject to these guidelines and standards. Under the IQA, agencies are required to establish administrative procedures enabling "affected persons" "to seek and obtain correction of information maintained and disseminated by the agency that does not comply with [the OMB IQA] guidelines;" agencies have established a 60-day period for their review and corrective action in response to such requests. Agency responses to such petitions are not judicially reviewable because the IQA establishes no Article III standing for petitioners. However, the President and OMB regulations require agency compliance with the IQA. Whereas 51 professors, relying on works that do not meet the IQA standards, can freely publish and argue (as they have) that patent litigation inhibits technological progress, the government is precluded from doing so. But that is exactly what the White House has done in contravention of the IQA by publishing its "patent troll" report known as the Patent Assertion Entities ("PAE") Report. It relies on many of the works cited by the 51 professors' letter, without even having conducted an IQA pre-dissemination review—a basic first-level IQA requirement. For these reasons, I have filed with the White House a petition under the IQA, requesting correction and removal of this PAE Report from all government websites. My Petition shows that the PAE Report contravenes the IQA because it expressly relies on third-party information that does not meet the IQA standards. The sources relied on by the PAE Report purport to document patent litigation rates, quantify the private and social costs of patent litigation, survey "victims" of PAE litigation, and show the purported adverse effects of PAE activities. This information includes studies that have undergone no peer review; that have relied on opaque or erroneous methods and surveys; that lack objectivity; and lack practical utility. To achieve agency compliance with identifiable IQA standards, my Petition concludes with 21 specific requests for correction supported by evidence and arguments. My Petition provides a compendium of detailed analyses of fundamental flaws surrounding data and methods used in eight commonly cited studies purported to document PAE harms, upon which the PAE Report relies. Examples of some of the PAE Report's assertions failing the IQA are:
I also show (including through FOIA revelations) that the PAE Report's secret author, a patent law professor, dominated its content by her own works, and those substantially reflecting her views. The White House omitted some in-text citations to the professor's works from the bibliographic reference list and falsely attributed her survey results to a news reporter. Together, these errors had the effect of concealing the dominance of this professor's works in the PAE Report. But where the professor's own publications elsewhere strike a balance by at least acknowledging and crediting references with views opposing her own (see Petition, Sec. 5.5.1), it appears that the White House overruled her approach, as the PAE Report generally fails the objectivity requirement of the IQA. It lacks objectivity both on presentation and substance, because it focuses only on the ostensible negative aspects of NPEs or PAEs. The IQA "objectivity" standard requires analysis that also includes the salutary economic benefits of patent enforcement, or the positive role of NPEs as intermediaries—analysis that is entirely omitted. The results are troubling. For example, the PAE Report disseminates this sweeping conclusory economic assessment: "the losses caused by excessive litigation [include] lost value to consumers who are not able to buy innovative products, and reduced income for workers whose pay is lower because they are unable to work with more productive new processes." Absolutely no evidence or other bases are cited in support of this allegation. Ironically, the stark failure to meet the IQA standards may produce the opposite result of that intended by the proponents of patent reform. For example, estimates of the number of NPE demand letters based on extrapolation from one extreme outlier case (see Petition at 41) are so fantastic that they undermine the credibility of the legitimate efforts to address a genuine (but infrequent) problem of abusive demand letters. The Petition and supporting material may appear to some readers as cumbersome and repetitive. This may be so because it is written to overcome the burden on the petitioner of establishing non-compliance with the IQA, including the requisite particularized requests for correction. Stay tuned to see what corrective action the White House may take. Link to the full IQA Petition for Correction  |
| Patent Law Moot Court: Disembodied Genetic Information as an Abstract Idea Posted: 06 Apr 2015 03:08 PM PDT In our Fourth Annual Patent Law Moot Court here at Mizzou Law, the students are grappling another Myriad lawsuit asserting its BRCA1 gene patents. The question presented is whether the cDNA claims that the Supreme Court suggested are patent eligible could be voided as improperly claiming an abstract idea. = = = = = Order: Presently before the Court is Defendant’s motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). In its oral motion, Defendants' asserted that Claims 2 and 6 of Myriad's U.S. Patent No. 5,747,282 are directed toward unpatentable subject matter under 35 U.S.C. § 101 as improperly claiming an abstract idea.[1] Plaintiffs disagreed and further responded that the issue had been foreclosed in its favor by the Supreme Court's recent decision regarding the claim and patent at issue and that the issue was not the proper subject of a motion to dismiss. Parties will brief the issue and particularly address the following:
Briefs will be submitted simultaneously by 5:00 pm on April 6, 2015 and will otherwise follow the requirements set out in Local Rule 4.3. The Court will entertain oral arguments on April 10, 2015 at 3:30 pm. Each party will be given up to 20 minutes to present its case. = = = = [1] The parties have stipulated that Claim 2 is directed toward a cDNA version of the naturally occurring BRCA gene and that Claim 6 is a fragment of the cDNA sequence defined by Claim 2. = = = = Should be interesting. How would you argue the case for/against? = = = = SPONSOR US: I’m looking for a sponsor for the event so that I can give the winner a cash prize. A tax-deductable donation of $5,000 will fund the system for the next four years and get your name mentioned in Patently-O each year! Dennis
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| Federal Circuit Cases to Watch on Software Patentability – Planet Blue Posted: 06 Apr 2015 07:08 AM PDT Guest Commentary by Robert Stoll In the wake of the Supreme Court's decision in Alice Corp v. CLS Bank (2014), there have been dozens of decisions in federal district courts and at the Federal Circuit that have applied Alice and Section 101 to a wide variety of business method and software related patents. And in the vast majority of these cases, the courts have invalidated the patents. This trend line has led to rampant speculation about the end of software patents. But a review of the patents in those cases indicates that the claims at issue in most of the district court cases (and arguably all the Federal Circuit decisions) were directed to business methods that would have likely been held invalid under Bilski and other pre-Alice decisions. What we have seen far less is how courts will apply Alice to patent claims directed to software technology (as opposed to business methods). Arguably the first of those cases is on its way through the Federal Circuit. The McRO (Planet Blue) v. Activision Blizzard, et al. (C.D. Cal. 2014) ("Planet Blue") appeal pending at the Federal Circuit may be an important indicator of how software patents will be evaluated by the courts going forward. Unlike many of the other Section 101 cases that have largely involved simple financial/business practices or similar non-technical "inventions," the patents in Planet Blue are directed to what appear to be actual technological challenges. The patents utilize complex and seemingly specific computer-implemented techniques. And yet the Planet Blue patents were found invalid under Section 101 in the district court. In deciding the case, Judge Wu did a thorough analysis of the patent claims, starting with the observation that "[f]acially, these claims do not seem directed to an abstract idea" and appear to be directed to a "specific technological process." However, interpreting Mayo to require him to disregard any aspect of the claims found in the prior art, he conducted a further analysis to determine what feature of the claims were novel. Wu found that the only aspect of the claims that added to the prior art was an abstract idea: "the use of rules, rather than artists, to set the morph weights and transitions between phonemes." Planet Blue has now appealed to the Federal Circuit, and opening merits briefs were recently filed. These and the subsequent briefs, arguments and decision in this case will be important for practitioners and patent holders for several reasons: The Federal Circuit will evaluate a patent claim that is technology-based. An initial read of the claims in the Planet Blue patents seem to be a far cry from basic method claims. The Planet Blue patents are used in animation; the technology helps automate the process of adapting an animated image to mouth words without having to draw or manually program the animated character's movements. Its' claims are drawn to the use of three-dimensional synchronization for certain applications in animation. The district court initially acknowledged that the claims, in isolation, appeared tangible and specific and did not seem directed to an abstract idea: "considered standing alone, the asserted claims do not seem to cover any and all use of rules for three-dimensional synchronization." In deciding this case, the Federal Circuit will be making an important decision on how to evaluate technology and software claims in a post-Alice environment. The decision should provide additional guidance on how to apply the 'significantly more' test. In the Alice decision, the Court recognized that patents – even those that are directed to an abstract idea or other ineligible concept – can be made patent eligible if the patent 'transforms' the abstract idea, or does 'something' or 'significantly more' than a patent on the concept itself. This is the second step of the Alice/Mayo test, which the Court refers to as the search for an inventive concept. Unfortunately, both the Supreme Court and Federal Circuit have provided scant guidance on what is necessary to satisfy this "significantly more" test. In this case, the district court found that the claims covered a well-known concept of lip synchronization and weren't sufficient to meet the 'significantly more' test. The Federal Circuit will review the claims, and assess whether the district court's analysis and conclusion were correct. The Federal Circuit's decision should provide some insight as to how 'significantly more' test should be performed and how claims should be read moving forward. Lower courts will be paying close attention to the Federal Circuit's ruling in this case in their 101 assessments. Just six weeks after the Planet Blue decision, another Section 101 decision came out from the Central District of California, this one authored by Judge Pfaelzer, in California Institute of Technology v. Hughes Communications, Inc. (C.D. Cal. 2014). In that case, the court denied Hughes' motion for summary judgment on Section 101 ineligibility. Judge Pfaelzer also undertook a lengthy analysis of Section 101 case law. In applying the Mayo/Alice framework, the court found that the Caltech claims were directed to abstract ideas, but that the claims were patentable since they contain inventive concepts. Interestingly, Judge Pfaelzer also made a point of discussing the Planet Blue decision. While respectfully acknowledging that Planet Blue offers valuable contributions to the Section 101 discussion, Judge Pfaelzer noted that Planet Blue ultimately reached the wrong conclusion since courts should not, in her view, apply the point-of-novelty approach in the Section 101 inquiry, citing the Supreme Court's Diamond v. Diehr decision. This is the first step in the journey, not the destination. Planet Blue may turn out to be a bellwether case on software patentability, as these patents seem quite similar to so many of the software patents held by companies across the IT industry and beyond. But the outcome is likely to be highly panel dependent, and it would not be surprising to see a request for en banc consideration at some point down the line. The case is sure to be closely watched, and it will be fascinating to see whether the Federal Circuit follows the lead of Ultramercial (and upholds the lower court decision on patent ineligibility), or whether the reasoning of DDR Holdings will prevail (and the Section 101 decision reversed). Bob Stoll is a partner at Drinker Biddle and Reath and Co-Chair of the IP Group and a previous Commissioner for Patents at the USPTO. The views expressed above are his own and do not necessarily represent the views of his firm or its clients.
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