Dennis Crouch's Patently-O: 2 new topics, including “No Appeal for Errors in Instituting IPR” |  |
- No Appeal for Errors in Instituting IPR
- Will the Federal Circuit Recognize the U.S.–Foreign Tradeoff in Friday’s Lexmark Argument?
- Patent Grants Per Fiscal Year (USPTO)
| No Appeal for Errors in Instituting IPR Posted: 30 Sep 2015 08:22 AM PDT Achates References v. Apple (Fed. Cir. 2015) At the conclusion of its Inter Partes Review Proceeding (IPR), the Administrative Patent Trial and Appeal Board (PTAB) concluded that several claims of Achates’ patents were invalid. U.S. Patents No. 5,982,889 (claims 1-4); and No. 6,173,403 (claims 1-12 and 17-19). Institution Not Appealable: In the appeal, the Achates argued that the review should never have been instituted – because it was time-barred under § 315(b). That provision bars institution of an IPR if “the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.” Achates argument was that it had already sued other Quickbook for infringement more than 1-year before Apple’s petition and alleged that the other companies were either real-parties of interest or privies of Apple based upon an indemnification agreement between the parties. The PTAB rejected that argument and also rejected Achates request for discovery from Apple on the topic. In particular, the Board held that the Quickbook would not be seen as a privy or real-party-in-interest even if Quickbook had indemnified Apple for infringement liability. Of some interest, the Board reaffirmed its not-time-barred institution decision in its final written decision. On appeal the Federal Circuit did not rule on the PTAB’s interpretation of privy and real-party-in-interest, but instead ruled that it had no jurisdiction to review the PTAB’s institution decisions:
In reaching its conclusion, the court relied upon Cuozzo and distinguished Versata II.
Dismissed.  |
| Will the Federal Circuit Recognize the U.S.–Foreign Tradeoff in Friday’s Lexmark Argument? Posted: 30 Sep 2015 07:11 AM PDT Guest post by Daniel Hemel, Assistant Professor at the University of Chicago Law School, and Lisa Larrimore Ouellette, Assistant Professor at Stanford Law School. On Friday, the en banc Federal Circuit will hear argument in Lexmark v. Impression Products, the printer cartridge resale case that will determine the fate of two key patent exhaustion precedents, including the current Jazz Photo rule that foreign sales do not exhaust U.S. patent rights. Despite extensive briefing (including over thirty amicus briefs), we argue in a new Essay that the key distributive tradeoffs between U.S. and foreign interests remain ignored (or misunderstood). Both sides in Lexmark argue that their proposed rule would be more efficient. Those advocating broader exhaustion rules (including Google, Costco, EFF, and a group of IP professors) argue that the current regime is complex and uncertain. Those favoring the status quo (including PhRMA, BIO, and IPO) point to the aggregate welfare gains from geographic price discrimination. While it is possible to construct models to support both views, we argue that the efficiency question cannot be answered without first making a choice about whose welfare is aggregated. As explained in more detail in our Essay, Trade and Tradeoffs: The Case of International Patent Exhaustion, the U.S. rule on international patent exhaustion implicates at least two tradeoffs between U.S. and foreign interests: First, there is a tradeoff between U.S. and foreign consumers. A U.S. rule of international exhaustion would cause prices of patented products in low-income countries to increase and prices of those same products in the United States to fall. It is thus surprising to see groups focused on global access to medicines such as Public Citizen advocating for this change; we are not aware of any study suggesting that a U.S. rule of international exhaustion would decrease prices in the developing world. As counterintuitive as it may be for developing countries and global access-to-medicines proponents to take the side of pharmaceutical companies, we think that their interests are in fact aligned on this issue. Developing-world consumers and pharmaceutical companies would both be better off if the Federal Circuit sticks with its Jazz Photo rule. Second, a U.S. rule of international patent exhaustion would make it more difficult for foreign countries to allocate access to patented goods using non-market mechanisms. Some national governments subsidize their citizens' consumption of patented products; examples range from the UK National Health Service's provision of pharmaceuticals to Uruguay's one-laptop-per-child program. As we explain in our Essay, such subsidies could end up being transferred to U.S. consumers via arbitrage if the Federal Circuit overrules Jazz Photo. At the very least, the decision to overrule Jazz Photo would make it more difficult for foreign governments to subsidize access to patented goods. We argue that one cannot answer the policy question at the heart of Lexmark without taking a position on these distributive questions. If one assigns zero value to the interests of foreigners, then the United States might well be better off if it adopted a rule of international patent exhaustion. (While international patent exhaustion would also reduce profits for U.S. patent holders, a majority of U.S. patents are issued to foreigners; if one adopts a purely nationalistic approach, the interests of most patent holders wouldn't count in the welfare analysis.) If one assigns a high value to the interests outside the United States, particularly those in developing countries, then one should almost certainly come down against a U.S. rule of international exhaustion. (If one assigns equal weight to the interests of all individuals regardless of nationality, then the question is somewhat closer.) How much the Federal Circuit should care about foreign consumers is a question that defies easy answer, but we hope that our Essay at least brings these tradeoffs into clearer focus. We also offer some tentative suggestions as to how U.S. courts might approach questions of global distributive justice.  |
| Patent Grants Per Fiscal Year (USPTO) Posted: 30 Sep 2015 04:25 AM PDT As expected, the USPTO has posted its first reduction in patent grants of the Kappos-Lee era. In Fiscal Year 2015, the PTO issued 296k utility patents. That is a 3% drop from the record high of 304k patents issued in FY2014. Although a modest reduction in the absolute number of patents granted, FY2015’s numbers still represent the second-highest number of patents granted in the PTO’s 200+ year history.  |
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