Lundgren filed U.S. Patent Application No. 08/093,516 on July 16, 1993, claiming the benefit of a series of continuation applications going back to 1988 for a method of compensating a manager who exercises administrative control over operations of a privately owned firm in an oligopolistic industry comprising, inter alia, the step of transferring compensation to the manager. The title of the application refers to a "Method and Apparatus," but no apparatus is disclosed or claimed.

In prior Appeal No. 96-0519, the Board of Patent Appeals and Interferences reversed the examiner's rejection of all of the claims under 35 U.S.C. §101 as being directed to non-statutory subject matter. The Examining Corps filed a request for reconsideration and rehearing, listing the following two issues for reconsideration:

1. Whether the invention as a whole is in the technological arts
2. Assuming that the invention is in the technological arts, whether the claim transferring compensation to a manager is a practical application.

In further prosecution, the examiner again rejected all of the claims as being directed to non-statutory subject matter under 35 U.S.C. §101, stating as follows:

both the invention and the practical application to which it is directed to be outside the technological arts, namely an economic theory expressed as a mathematical algorithm without the disclosure or suggestion of computer, automated means, apparatus of any kind, the invention as claimed is found non-statutory.

The rejection was predicated on two assertions by the examiner—that the claims fail to produce a useful, concrete, and tangible result (later withdrawn by the Examiner), and that the claims are not limited to the technological arts as required by 35 U.S.C. §101.

Lundgren filed a second appeal to the Board, and an expanded panel of the Board heard oral argument on April 20, 2004.

In a rare precedential opinion issued in October 2005, a 3–2 majority consisting of Chief Administrative Patent Judge (APJ) Fleming, Vice Chief APJ Harkcom, and APJ Hairston reversed the examiner's rejection of the claims as being directed to non-statutory subject matter under 35 USC 101 in an eight-page per curiam opinion. The majority stated that the only issue for review in the appeal was, to use the examiner's terminology, "whether or not claims 1, 2, 6, 7, 19-22, 32, and 35-40 are limited to the technological arts, as required by 35 U.S.C. § 101."

The majority noted that claim 1 is directed to a process, one of the four statutory classes of subject matter listed in 35 U.S.C. § 101 which provides as follows:

Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain patent therefor, subject to the conditions and requirements of this title.

The majority then reviewed these three cases, and found that they did not support the examiner's separate "technological arts" test, stating as follows:

Our determination is that there is currently no judicially recognized separate "technological arts" test to determine patent eligible subject matter under § 101. We decline to create one. Therefore, it is apparent that the examiner's rejection can not be sustained.

In a five-page dissenting opinion, APJ Jerry Smith took the position that the issue presented by the examiner was one of first impression, and disagreed with the majority's apparent position that all categories of non-statutory subject matter have been established (i.e., laws of nature, physical phenomena, and abstract ideas).

APJ Smith warned the majority that their position that essentially anything that can be claimed as a process is entitled to a patent under 35 U.S.C. §101 "opens the floodgate for patents on essentially any activity which can be pursued by human beings without regard to whether those activities have anything to do with the traditional sciences or whether they enhance the technological arts in any manner." APJ Smith took the position that the appropriate forum for deciding the question at issue in this case is the federal judiciary, and urged that the examiner's rejection be sustained so that the federal judiciary will have a chance to decide the question. He also joined APJ Barrett in urging the Board to enter a new ground of rejection under 35 U.S.C. 101.

In a massive sixty-five-page single-spaced concurring-in-part and dissenting-in-part opinion, APJ Barrett agreed with the majority that there is no separate "technological arts" test. However, in an exhaustive legal analysis of statutory subject matter reaching back to the British Statute of Monopolies of 1623, 21 Jac. 1, ch. 3., APJ Barrett vigorously dissented with virtually every other statement made by the majority and concluded that claim 1 is not directed to statutory subject matter under 35 U.S.C. § 101 for numerous other reasons, and urged that the Board enter a new ground of rejection under 35 U.S.C. § 101 for those reasons.

BPAI outlines requirements for Examiner's to maintain prima facie rejection of claims under 35 U.S.C. §112, first paragraph, for a genus where specification describes at least one species of the genus
In an appeal from a final rejection, the Board of Patent Appeals and Interferences reversed rejections based on both the written description and enablement requirements of 35 U.S.C. § 112, first paragraph, and entered a new ground of rejection under 35 U.S.C. § 112, second paragraph for one of the claims. The Board found that the claims were directed to a naturally occurring amino acid (or polynucleotide) sequence at least 95% identical to the disclosed amino acid (or polynucleotide) sequence and met the written description requirement. The Examiner has rejected claims for failing to comply with the written description requirement, asserting that the specification provides only a single representative species – the polynucleotide of SEQ ID NO: 2, and fails to disclose any structure-function relationship in this species. The Examiner also rejected the claims for failing to comply with the enablement requirement, asserting that because the specification does not teach the specific amino acids and structural motifs in the proteins encoded by the claimed polynucleotides that are essential for protein activity (specifically, malate dehydrogenase activity), the amount of experimentation required to make the claimed polynucleotides was undue. In response, the Appellants contended that because the claims at issue recite polynucleotides having a naturally occurring polynucleotide sequence, or that encode a polypeptide having a naturally occurring amino acid sequence, "through the process of natural selection, nature will have determined the appropriate amino acid sequences."

On appeal, the Board sided with the Appellants on whether the claims were supported by the specification for the purposes of 35 U.S.C. §112, first paragraph. Specifically, on the issue of written description, the Board noted that "[t]he written description requirement . . . does not require a description of the complete structure of every species with a chemical genus." While the Examiner asserted that the disclosure of the single disclosed species does not disclose the structure sufficient to support a genus, the Board found there was insufficient evidence to maintain a rejection under 35 U.S.C. §112, first paragraph, for lack of written description since "the examiner has not adequately explained and/or provided evidence to support that assertion."

Similarly, with regard to the enablement rejection, the Board disagreed with the Examiner's assertion that in order to satisfy this requirement, the specification must provide guidance regarding the specific amino acid residues that are tolerant to change without affecting malate dehydrogenase activity. Instead, the Board deemed persuasive the Appellants' argument that because the claims were limited to naturally occurring sequences, nature will have determined the amino acid residues that are tolerant to change (i.e., naturally occurring variants will presumably retain malate dehydrogenase activity). In particular, in reversing the Examiner's enablement rejection, the Board determined that the Examiner had not provided sufficient evidence that a naturally occurring polypeptide that is at least 95% identical to the amino acid sequence of SEQ ID NO: 1 or a polypeptide encoded by a naturally occurring polynucleotide sequence that is at least 95% identical to the polynucleotide sequence of SEQ ID NO: 2 would not retain malate dehydrogenase activity. As such, for the purposes of satisfying 35 U.S.C. §112, the disclosure of a natural sequence in and of itself is generally sufficient for disclosing a variance for that sequence, and the Examiner is required to provide evidence that such disclosure is insufficient in order to maintain a prima facie case of failure to comply with 35 U.S.C. §112, first paragraph. Ex parte Bandman, No. 2004-2319, (BPAI January 2005) (Non-Precedential).

BPAI interprets closed transition phrase for method claims
In a case involving processes for preparing an organic electroluminescent element, the patent examiner issued a rejection for indefiniteness under 35 USC 112, second paragraph. The examiner indicated that the claimed language of "consisting essentially of" is accepted as "excluding any further steps which materially affect the process." The examiner further stated that since dependent claims 43, 44, 55 and 56 require the further step of forming a sealing membrane which would affect the claimed process, therefore, these claims contradict "two mutually exclusive limitations." On appeal at the Board of Patent Appeals and Interferences (BPAI), the Board reversed the examiner. In a non-precedential opinion, the Board held that the phrase "consisting essentially of" does not "limit the claim to only those steps recited in the claim," Ex parte Hoffman, 12 USPQ2d 1061, 1063 (BPAI 1989), as would a phrase such as "consisting solely of." In fact, according to the Board, the phrase, "consisting essentially of" does not necessarily limit the claims so as to exclude other things when the specification clearly indicates that other constituents may be present. The Board found that limitations described in the dependent claims were disclosed in the specification. As such, the Board concluded that those elements cannot contradict the basic characteristics of the invention as suggested by the Examiner. Ex parte Hideaki Ueda, Appeal No. 2004-1584 (BPAI November 18, 2004) (Non-Precedential).

Means-Plus-Function Claim
Limitation in claim for image processing apparatus that recites “a destroying member for destroying said thermally processed film after said film has been scanned” is means-plus-function limitation, since term “a destroying member” is provided within functional context to describe functional feature of destroying thermally processed film after it has been scanned, and as such is permissible under narrow rule of construction of 35 U.S.C. §112, sixth paragraph. (Sanada v. Reynolds, 67 USPQ2d 1459, Bd Pat App & Int (unpub), 3/19/03).

Web Balance’s patent 6,128,279 (‘279 patent) described a method and apparatus for web site computer servers to handle incoming requests from client computers using URIs. URIs are essentially resources located on a particular server. Plaintiff’s “Weblogic” software performed similar, allegedly, infringing tasks. The case hinged on the usage and definitions of URI—Uniform Resource Identifiers, and URL—Uniform Resource Locators. Plaintiff’s software used a session ID to track a user’s interaction with a particular website. The session ID begins with a semicolon and is appended or inserted into the requested web address of the user—“http://www.zzz.com/app;jsessionid=1234.” The ‘279 patent claim 4 asserted a method for handling user requests, where the server handles the request or forwards it to a different computer for processing.

Plaintiff alleged Weblogic did not infringe claims 4, 6, or 8 of the ‘279 patent. Specifically, plaintiff cited 2nd embodiment of ‘279 in claiming that Web Balance considered the URI to be the discrete portion of a URL, “http://www.zzz.com/application”, where “/application” is the URI and “www.zzz.com” is the URL. Thus, Weblogic’s session ID could not be considered the URI. Web Balance countered that common usage of the terms URI and URL (as evidenced in Internet Request for Comments (RFC)) indicated that the entire string of characters in a web address constituted the URI, including both URL and session ID.

The court resorted to the analysis of Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) in concluding that, although the claims must be read in light of the specification, it is improper to confine such claims to any preferred embodiment. However, since the language of the patent did not adequately define URI, and the prosecution history was unrevealing, the court considered extrinsic evidence in the form of the parties’ expert testimony. Although both experts offered similar definitions of URI, the court concluded that the ‘279 patent language provided that a particular server would handle all the requests for a particular resource (URI). Weblogic’s system however allowed a particular server to handle all the requests from a specific user (session ID). Further, both systems would be recognized as performing their respective functions by those skilled in the art. Since the session ID did not specify a particular resource, rather only a specific user, it was fundamentally different than a URI. Hence, the court allowed plaintiff’s motion for summary judgment of non-infringement.

As there was no explicit waiver in the DMCA, the Court of Federal Claims reviewed the Tucker Act, 28 U.S.C. §1491, and found that this waiver only applies where the underlying cause of action creates a right to monetary damages against the Federal Government. As the DMCA did not contain a clear and unambiguous waiver of sovereign immunity and only vaguely imposes liability on "any party," the Tucker Act does not cure this omission.

Additionally, while 28 U.S.C. §1498(b) provides a waiver of sovereign immunity with regards to copyright infringement, the Court of Federal Claims found that the DMCA provides "a new violation and not merely a new subset of infringement." As such, 28 U.S.C. §1498(b) also does not afford relief for circumvention activities under the DMCA.

z4 Technologies owns patents 6,044,471 and 6,785,825, which are drawn to “product activation” methods which prevent the unauthorized use of computer software. At trial, z4 technologies asserted infringement of three claims (one from ‘471 and two from’825). The jury found infringement of all three claims by both defendants, and found Microsoft’s infringement willful. Hence, the jury awarded z4 $115 million from Microsoft and $18 million from Autodesk. z4 subsequently filed the motion denied in this decision, requesting a permanent injunction on defendants’ manufacture of sale of the infringing products

To deny the permanent injunction, the court relied on the recent Supreme Court result in eBay, Inc. v. Mercexchanges, LLC, 126 S.C. 1837 (2006). There the Supreme Court held that permanent injunctions in patent cases must meet the traditional four-factor test for equitable relief. To win, a plaintiff must show 1) irreparable injury, 2) that remedies at law (primarily damages) are inadequate compensation, 3) that, balancing the respective hardships of each party, equitable relief is warranted, and 4) that a permanent injunction would not disserve the public interest.

Irreparable Injury
z4 argued for a rebuttable presumption of irreparable injury, claiming that eBay incorporated the Federal Circuit presumption of irreparable injury when considering preliminary injunctions in patent cases. z4 also argued that the Federal Circuit’s presumption was incorporated from copyright law, and since eBay draws a parallel between patent and copyright law, a presumption is appropriate. The court rejected both these arguments for a presumption of injury, relying on the plain wording of the eBay case which “places the burden of proving irreparable injury on the plaintiff.” Id. at 4.

The court also rejected z4’s claims that its “tremendous efforts to commercialize” their invention failed due to Microsoft’s infringement and that Microsoft’s infringement will continue to damage z4’s efforts to market its invention. The court, finding that Microsoft does not sell, license, or distribute individually package product activation software, nor do Microsoft customers purchase MS products for their software activation functionality, could find no logical way in which Microsoft’s infringement damaged z4’s market.

Adequacy of Remedies Available at Law
The court rejected z4’s claim that monetary damages for future infringement were not sufficient to compensate for the loss of their right to exclude Microsoft’s use of z4’s patents. eBay, says the court, indicated that a violation of the right to exclude does not inevitably mean that the loss is beyond compensation. In cases where the infringer damages the market for the patent holders enterprise by saturation or damage to the patent holder’s reputation, monetary compensation may be inadequate due to the difficulty of calculating the loss of market share. The District Court distinguished such cases from this one because here the only loss of market share is lost sales to Microsoft itself. Monetary damages can be easily calculated for this loss.

The court also noted that Justice Kennedy’s eBay concurrence suggested that monetary damages are often sufficient when the infringing practice is “but a small component of the product” at issue. Since in this case product activation is a small feature of the Microsoft Windows and Office software, Justice Kennedy’s concurrence supports a conclusion that monetary damages are sufficient and an injunction may be against the public interest.

Finally, the court said that available legal remedies are sufficient because Microsoft plans on phasing out the infringing products with the next three years. The court reasoned that calculation of a royalty for this period should not be too difficult or indefinite. Also, the court found that there was is no credible issue with Microsoft’s ability to pay these future royalties.

For the above reasons, the court held that z4 had not show the insufficiency of monetary damages, and therefore the second prong of the factors for injunction weighed in Microsoft’s favor.

The Balance of Hardships
z4’s request for injunction, if granted, would have required Microsoft to 1) after a reasonable grace period, cease selling infringing versions of Windows and Office and 2) immediately deactivate Microsoft product activation servers. The court found that the hardship these two requirements would inflict on Microsoft could include the enormous expense of repairing versions of software that will soon be obsolete and the potential of rampant piracy once product activation servers were deactivated. In contrast, z4’s hardship is one that can be remedied with monetary damages. Therefore, the balance of hardships weighs in favor of Microsoft.

The Public Interest
The court noted that Microsoft products are incredibly popular, and while the actual effects of an injunction can only be hypothesized, even a small disruption in the availability of these products would likely be at least somewhat harmful to the public. Likewise, deactivation of Microsoft’s product activation servers may cause an increase in piracy and the potential of harm from illegitimate software. In contrast, denying the injunction at issue would seem to have no harmful effects on the general public. Thus, while the damage to the public is somewhat speculative, this prong also weighs against granting the injunction.

Conclusion
Thus, the court found that each of the four traditional equitable relief factors weighed against granting z4’s request for an injunction. Instead, the court issued an order severing z4’s claim of future damages and requested the filing of a new complaint. The court also ordered Microsoft to file quarterly reports on the number of Windows and Offices units shipped so as to facilitate the calculation of future damages. This straightforward application of the newly decided eBay case is likely only the first of many decisions to deny what used to be almost automatic injunctions against infringers.

Plaintiff argued that it had no product to mark; its website was simply a method to obtain a service provided using the patented system. For intangible inventions, the Supreme Court has said that marking can only be given in connection with a fabricated article; patentees who do not provide a fabricated article have no duty to mark. Wine Ry. Appliance Co. v. Enterprise Ry. Equipment Co, 297 U.S. 387 (1936). In the present case, the patented database and transaction servers are neither made nor offered for sale by IMX. In fact, customers never see the servers physically. Thus, according to the Plaintiff, marking the fabricated, tangible system would not serve the notice purpose of 35 U.S.C. 287(a) since the actual system itself is not before the relevant public.

In finding for the Defendant, the District Court interpreted the Federal Circuit as further explaining the holding of Wine Ry. Appliance Co. in American Medical Systems, Inc. v. Medical Engineering Corp., 6 F.3d 1523 (Fed. Cir. 1993). Under the standard in American Medical Systems, to the extent there is a tangible item to mark by which notice could be given, the party has a duty to do so in order to obtain the benefits of increased damages under 35 U.S.C. 287. The court held that the IMX website was a tangible item through which the patented system was accessed by the relevant public. Since the IMX website was intrinsic to the patented system, the website needed to be marked with an appropriate patent marking in accordance to 35 U,S,C, §287(a) in order to qualify for pre-notice damages.

Lastly, the Plaintiff asserted that, since the infringed patents were technically on its company website in the form of press releases, the website was marked for the purposes of 35 U.S.C. 287. However, the court found that that the existing descriptions on the website including mentions of a “patented process,” “patented system,” and a link to the patent were not sufficient to meet the requirements of 35 U.S.C. 287(a) since they did not obviously relate to the website through which customers would access the patented database and transaction servers.

The terminal disclaimer disclaimed any term of the ‘538 patent that would otherwise have extended beyond the ‘422 patent, which expired on June 23, 2003. The original termination date of the ‘422 patent was June 3, 2002 (17 years from its issue date) but, pursuant to 35 U.S.C. §154, this date was reset to June 23, 2003 (20 years from its filing date). The USPTO agreed that the ‘538 patent’s expiration date should be reset at June 23, 2003 as well since the term of the ‘538 patent was linked to the term of the ‘422 patent. Thus, based on the terminal disclaimer, the ‘538 patent had been scheduled to expire on June 23, 2003.

On June 4, 2003, pursuant to 35 U.S.C. §156, the PTO extended the term of the ‘538 patent for a period of 1810 days, running from June 23, 2003, based on FDA review. Teva submitted an ANDA to the FDA seeking approval to engage in the commercial manufacture, use, and sale of zaleplon, a generic product which is bioequivalent to King’s Sonata drug products. The crux of Teva’s argument is that the term of a terminally disclaimed patent may not be extended under 35 U.S.C. §156 and, therefore, the ‘538 patent expired on June 23, 2003.

On the issue of whether a terminally disclaimed patent is extended under 35 U.S.C. §156, the District Court held that a terminally disclaimed patent is eligible for extension under 35 U.S.C. §156. Specifically, the District Court held that 35 U.S.C. §156 is plain and unambiguous: a terminally disclaimed patent is not barred from receiving a 35 U.S.C.§156 extension. The only limitations on the provision of a 35 U.S.C.§156 patent term extension are those expressly enumerated at §156(a)(1)-(5). Nonexistence of a terminal disclaimer is not among those enumerated conditions, and, therefore, cannot be construed to be a condition for obtaining a 35 U.S.C. §156 patent term extension.

Additionally, the District Court compared 35 U.S.C. §156 and 35 U.S.C. §154(b) to show that unlike 35 U.S.C.§156, 35 U.S.C.§154(b) expressly refers to terminally disclaimed patents. Specifically, 35 U.S.C.§154(b) provides that "[n]o patent the term of which has been disclaimed beyond a specified date may be adjusted under this section beyond the expiration date specified in the disclaimer.” As such, 35 U.S.C.§154 demonstrates that Congress knows how to draft a clear exception barring a terminally disclaimed patent from receiving a patent term extension.

Moreover, the District Court found that Congress amended both 35 U.S.C.§156 and 35 U.S.C.§154 in Pub. L. No. 103-465, §532 (1994), in which Congress initially enacted 35 U.S.C.§154’s exception for terminally disclaimed patents, and has amended both provisions several times since it enacted Pub. L. No. 103-465, §532 (1994). The Court thus presumed that Congress acted intentionally and purposely when it included an exception for terminally disclaimed patents in 35 U.S.C.§154 and omitted any exception for terminally disclaimed patents in §156.

Lastly, the District Court noted that the United States Patent and Trademark Office, in 37 C.F.R. §1.775(a), states that “[i]f a determination is made pursuant to §1.750 that a patent for a human drug, antibiotic drug or human biological product is eligible for extension, the term shall be extended by the time as calculated in days in the manner indicated by this section. The patent term extension will run from the original expiration date of the patent or any earlier date set by terminal disclaimer (§1.321).” Since the PTO promulgated §1.775(a), Congress amended §156 six times. However, Congress has never amended §156 to undermine the PTO’s interpretation of §156 or to change §156’s language to bar terminally disclaimed patents from receiving a §156 extension.

As a result, Medrad filed a second reissue application to remedy the problems of the ‘648 patent. The PTO issued the ‘602 patent, the only divergence from its immediate predecessor is that during the prosecution of the ‘602 patent, the missing supplemental reissue declarations were filed. The ‘602 patent does not differ from the ’648 patent in the specifications, drawings, or claims.

Tyco filed a motion for summary judgment of invalidity of the ‘602 patent, arguing that the reissue was defective under the reissue statute, 35 U.S.C. § 251. This statute provides that a reissue application can only be filed to correct one of four statutorily identified errors: a defect in the specification, a defect in the drawings, or an error in either overclaiming or underclaiming in the patent. Medrad contends that a reissue can correct any number of patent prosecution mistakes, including failure to file the appropriate declarations.

The District Court relied on the case law of the Court of Appeals for the Federal Circuit (CAFC), which does not establish any precedent of 35 U.S.C. § 251 being used to correct procedural errors made during prosecution. Rather, all of the CAFC cases identified by the court that address this issue begin their analysis by identifying which of the four statutorily identified errors the reissue applicant is trying to correct. That is, the courts have consistently interpreted the reissue statute to require that the mistake sought to be remedied be within the express terms of the statute. Therefore, the District Court granted Tyco’s motion for summary judgment of invalidity of the ‘602 patent since this reissue patent was not based upon an issue for which reissue can be sought under 35 U.S.C. § 251. As such, while reissue is generally available for a multitude of errors, reissue is not available for more procedural defects not within the scope of the reissue statute itself.

On the issue of whether the phrase "Frosty Treats" is a protectable trademark, the Eighth Circuit reviewed the factors of whether a mark is protectable. For a mark to be protectable, the mark must first be categorized as (1) generic, (2) descriptive, (3) suggestive, or (4) arbitrary or fanciful. Court held that, while "Frosty Treats" as a mark is not generic, the mark is descriptive. Thus, the mark is only protectable to the extent the mark has acquired secondary meaning in the relevant market. Therefore, Frosty Treats needed to show that the mark had acquired a secondary meaning to identify its goods and distinguish them from those of others. According to the evidence of record, the evidence indicated that respondents to a survey conducted recognized the truck with the Frosty Treats phrase simply as a generic ice cream truck, thus failing to establish secondary meaning for the phrase "Frost Treats" on the ice cream. Although direct evidence such as consumer testimony or surveys are probative of secondary meaning, secondary meaning can also be proven by circumstantial evidence. However, the circumstantial evidence offered by Frosty failed to raise a genuine issue of material fact. Therefore, the Court concluded that the "Frosty Treats" phrase was not protectible under trademark law.

On the issue of whether the Safety Clown graphic is a protectable mark or a non-protectable functional graphic, the District Court held that because the Safety Clown graphic serves a purpose, the graphic is functional and therefore not protectible. The Eighth Circuit disagreed since District Court evaluated the issue using the colloquial meaning of "functional" rather than specialized meaning it has in trademark law. In trademark law, "a product feature is functional, and cannot serve as a trademark, if it is essential to the use or purpose of the article or if it affects the cost or quality of the article." To be functional, the feature must be necessary to afford a competitor the means to compete effectively. There was no evidence that the exclusive use of the Safety Clown graphic would deny Frosty Treats' competitors the ability to compete effectively or place competitors at any non-reputational disadvantage. Therefore, whether the Safety Clown graphic is functional presents a factual issue not appropriate for resolution upon a motion for summary judgment.

However, even assuming that the Safety Clown graphic and the mark "Frosty Treats" are protectable as trademarks, the Eighth Circuit held that there was no likelihood of confusion. Specifically, the Eighth Circuit evaluated whether a likelihood of confusion exists with respect to the trade dress of the trucks and the Safety Clown in light of six criteria: (1) strength of owner's mark; (2) similarity between the owner's mark and the alleged infringer's mark; (3) degree to which the products compete with each other; (4) alleged infringer's intent to pass off its goods as those of the trademark owner; (5) incidents of actual confusion; and (6) type of product, its costs and conditions of purchase. For the first factor, the Eighth Circuit held that the Safety Clown mark and trade dress of Frosty Treats' truck are weak marks since the use of a clown on an ice cream trucks is hardly novel and Frosty Treats' vans resemble a generic ice cream truck and therefore lack distinctiveness within the marketplace. For the second factor, the Eighth Circuit held that the Safety Clown mark and trade dress of Frosty Treats vans are visually distinct from depictions in video games and no reasonable juror could find them similar. In regards to the third and fourth factors, the Eighth Circuit held that SCEA's products do not compete with Frosty Treats and no evidence was shown that SCEA intends to pass off Frosty Treat's mark as its own. For the fifth factor, Frosty Treats failed to provide any proof of actual confusion by a non-interested party, with the only evidence of actual confusion being the testimony of an interested person. Lastly, in deciding the sixth factor, the Eighth Circuit held that the sixth factor is more important in confusion-of-source cases where degree of care that a purchaser exercises in purchasing a product can eliminate confusion that might otherwise exist. In this case, Frosty Treats' action is based on confusion of sponsorship, and thus the customers' degree of care is of diminished importance. Accordingly, Frosty failed to present sufficient evidence to create a triable issue as to the likelihood of confusion between the trade dress of Frosty Treats' trucks or its Safety Clown.

Lastly, the Eighth Circuit held that Frosty Treats does not have actionable claims for trademark dilution under federal and Missouri law. Specifically, Frosty Treats failed to show that the marks and trade dress at issue are famous as required by 15 U.S.C. §1125(c). In addition, the Eighth Circuit held that Frosty Treats failed to show "likelihood of injury to business reputation or of dilution of the distinctive quality of mark….shall be ground for injunctive relief," since the marks and trade dress at issue are so dissimilar that it would be erroneous to hold that there was a likelihood of dilution. Frosty Treats v. Sony Computer Entertainment America (SCEA), 2005 U.S. App. LEXIS 15127, Civ. Case No. No. 04-2502 (8th Cir. July 25, 2005)

License Agreement: Patented cartridge inside sold subject to a Single Use Only restriction. It is a violation of this agreement and/or it is unlawful to resell, reuse, refill or remanufacture.

On motion for summary judgment, the District Court for the District of Northern California reviewed the law of patent exhaustion and found that, for exhaustion to attach, the patented article must have been sold without restrictions on the use. Further, if the sale was conditional, patent exhaustion does not apply. In analyzing the sale of the printer cartridge having the single use restriction, the District Court noted that the single use restriction was obviously placed and readily seen by the end user. The District Court further held that the restriction was included in a valid shrink wrap license and that the user is able reject the restriction by obtaining a more costly version of the cartridge from Lexmark, which was evidence that the end user received consideration for the restriction on the cartridge's use. As such, the District Court held that the restriction was valid and enforceable such that the sale was conditional. Since the sale of the cartridge was conditional, the patent was not exhausted. Therefore, the District Court granted summary judgment dismissing ACRA's claims of unfair trade practices, and found that Lexmark's use of the single use restriction was proper and "falls squarely within Lexmark's patent right." ACRA v. Lexmark Int'l Inc., Civ. No. 01-4626 (N.D. Cal. Sept. 29, 2003).

While the case is currently on appeal pending a decision by the Ninth Circuit, the District Court's decision is instructive in showing that, by placing a condition on the sale of the patented consumable, it is possible to preserve the patent rights for that patented consumable. Specifically, the use of end user license agreements would appear to directly prevent the end user from performing one or more tasks not required for the intended end use of the consumable (i.e., using the printer cartridge in the printer) while validly preventing the unauthorized use of the consumable (i.e., re-filling the printer cartridge).

On October 24, 2001, Medrad filed a complaint in district court against Tyco alleging infringement of the ‘602 reissue patent. Medrad and Tyco filed cross motions for summary judgment regarding the validity of the ‘602 reissue patent, and more specifically, regarding whether the failure of Medrad to file a supplemental declaration in the '648 reissue patent qualified as an “error” under 35 U.S.C. §251. 35 U.S.C. §251 requires the following in regards to the error requirement:

Whenever any patent is, through error without any deceptive intention, deemed wholly or partially inoperative or invalid, by reason of a defective specification or drawing, or by reason of the patentee claiming more or less than he had a right to claim in the patent, the Director shall, on the surrender of such patent and the payment of the fee required by law, reissue the patent for the invention disclosed in the original patent, and in accordance with a new and amended application, for the unexpired part of the term of the original patent.

On appeal, the Federal Circuit held that 35 U.S.C. §251 can be read to encompass any error that causes a patentee to claim more or les than he had a right to claim. The Federal Circuit relied on its previous holding in In re Weiler, 790 F.2d 1576, 1579 (Fed. Cir. 1986) that “in enacting [§251], Congress provided a statutory basis for correction of ‘error.’ The statute is remedial in nature, based on fundamental principles of equity and fairness, and should be construed liberally.” The plain meaning of 35 U.S.C. §251 indicates that the error involves rendering a patent wholly or partly invalid by reason of – i.e., because of – claiming more or less than a patentee has a right to claim. Here, by including changes to the language of the claims that narrowed the scope of coverage and by correcting inventorship, the resulting ‘648 reissue patent claimed more than it had a right to claim in the patent without submitting a supplemental declaration to support the narrowing subject matter and the change in inventorship. The correction of such an error meets the express terms of §251, and thus serves as a basis for reissue. As such, the Federal Circuit reversed the district court's finding of invalidity.

Motivation to combine sufficient to establish prima facie case of obviousness can be based upon implicit teaching supported by expert witness evidence about understanding at time of invention
In Alza Corporation v. Mylan Laboratories, Case No. 06-1019 (Fed. Cir. Sept. 6, 2006), the Federal Circuit upheld a district court’s decision that plaintiff-appellant Alza’s patent (6,124,355) was invalid and was not infringed by defendant-appellee Mylan’s generic version of an extended release anti-incontinence drug, oxybutynin.

The court upheld the finding that the patent was invalid as obvious while primarily discussing the “motivation-suggestions-teaching” doctrine. The court defended the motivation requirement as flexible because the motivation need not be found explicitly in the prior art so long as there is evidence in the record as to why, at the time of the invention, one skilled in the art would make the asserted combination. While an explicit motivation to combine is one way to meet this test, the Federal Circuit held that the broader inquiry rests "on the unremarkable premise that legal determinations of obviousness, as with such determinations generally, should be based on evidence rather than on mere speculation or conjecture." Moreover, in meeting the prima facie burden for obviousness, "where the testimony of an expert witness is relevant to determining the knowledge that a person of ordinary skill in the art would have possessed at a given time, this is one kind of evidence that is pertinent to our evaluation of a prima facie case of obviousness." Thus, it is sufficient for the record show some evidence demonstrating that, at the time of the invention, information was available which would lead one skilled in the art to make the combination.

In applying this test, the court held that the motivation to combine oxybutynin and the time-release pill delivery system existed to the person of ordinary skill in the art in 1995 (the time of the ‘355 patent filing) based upon expert witness testimony. Plaintiff argued that two prior art references demonstrated that, in 1995, no one knew that oxybutynin would be well-absorbed in the colon and thus would not be motivated to create a time release pill form factor. The court found that both references in fact implied that drugs such as oxybutynin would be well-absorbed in the colon, and that the expert witness testimony on the knowledge of persons in the art at the time of the invention was sufficient to meet a prima facie burden for obviousness purposes. The Federal Circuit held that the Plaintiff had failed to rebut this prima facie burden since the applied references did not undercut the witness' testimony and no other evidence contradicted the testimony or otherwise showed that the expectations were other than that set forth by the expert witness, and found the claims invalid under 35 U.S.C. §103.

The court upheld the finding of non-infringement because Alza failed to submit evidence sufficient to demonstrate that Mylan’s formulation met the time-release characteristics claimed in the ‘355 patent. Alza submitted profiles of the amount of drug in a subject’s blood for both Alza’s and Mylan’s formulation, and similarly submitted evidence of similar release times in laboratory apparatus for the two formulations. However, since the ‘355 patent claimed the rate of in vivo dissolution in the gastrointestinal tract, and since Alza declined to link its two studies to the rate of in vivo dissolution, the court found that the Mylan formulation did not infringe the ‘355 patent.

Licensing Limitations That Prevent Patent Exhaustion For Use of Seeds Also Do Not Constitute Patent Misuse or Antitrust Violations
In Monsanto Company v. Mitchell Scruggs, Civ. Case Nos. 04-1532, 05-1120, 05-1121 (Fed. Cir. August 16, 2006), Mitchell Scruggs (Scruggs) appealed the holding of the Northern District of Mississippi granting Monsanto Company (Monsanto) a permanent injunction against Mr. Scruggs and granting Monsanto’s motions for summary judgment regarding patent validity and infringement to the United States Court of Appeals for the Federal Circuit. Mr. Scruggs also appealed the District Court’s denial of his claims of antitrust violations, patent misuse, tortuous interference, unfair competition and invasion of property. The Federal Circuit affirmed the District Court's holding with respect to the motion for summary judgment of patent validity and infringement and the denial of his cross-claims. The Federal Circuit further ordered the permanent injunction to be vacated and the case remanded to the District Court for reconsideration of the permanent injunction in light of the Supreme Court’s eBay Inc. v. MercExchange L.L.C. holding.

Monsanto is the owner of U.S. Patent No. 5,352,605 (‘605). The ‘605 patent is directed toward insertion of a synthetic gene consisting of a 35S cauliflower mosaic virus promoter amongst other advancements, to create herbicide resistance. Using the ‘605 patent, Monsanto developed glyphosate herbicide resistant soybeans and cotton which were sold as Roundup Ready (Roundup) soybeans and cotton. The licensing of Roundup Ready soybeans and cotton began in 1996. Monsanto further combined the ‘605 patent with patents No. 5,164,315; 5,196,525; and, 5,322,938. This combination was licensed in 1998 as Bollgard/Roundup Ready cotton technology.

Monsanto’s licensing agreements with seed growers allowed the seed growers to incorporate Monsanto’s biotechnology into their seeds. The licenses also required seed companies to avoid selling seeds to growers unless the grower signed a Monsanto license and that seeds sold under the license be used to grow only a single commercial crop. Mr. Scruggs purchased the seeds produced under the Monsanto patents from seed companies but never signed a licensing agreement. Further, he harvested the soybeans and cotton, retained the new generation of seeds and subsequently planted the new seeds in a later generation of crops. Monsanto filed suit for infringement of their patents against Mr. Scruggs in 2004.

Patent Exhaustion
The District Court found the patent exhaustion defense claimed by Mr. Scruggs was inapplicable because Monsanto never made an unrestricted sale of its biotechnology. Mr. Scruggs argued that he purchased the Monsanto seeds in an unrestricted sale. As such, he was therefore entitled to use those seeds in an unencumbered fashion under the doctrine of patent exhaustion.

Relying on Mallinckrodt, Inc. v. Medipart, Inc., 976 F.2d 700, 701 (Fed. Cir. 1992); and LG Elecs., Inc. v. Bizcom Elecs., Inc., 2006 U.S. App. Lexis 16916 (Fed. Cir. July 7, 2006), the Federal Circuit held that the “first sale/patent exhaustion doctrine establishes that the unrestricted first sale by a patentee of his patented article exhausts his patent rights in the article.” Based upon this standard, the Federal Circuit affirmed the District Court's denial of the affirmative defense of patent exhaustion because patent exhaustion was inapplicable to the Mr. Scruggs' case since there was no unrestricted first sale.

Specifically, the Federal Circuit found there was no unrestricted sale because the use of the seeds by seed growers was conditioned on obtaining a license, and because the new seeds grown from the original batch had never been sold in a manner corresponding to an unrestricted first sale. The Court therefore found that there can be no patent exhaustion as to a subsequent generation of seeds where there was no unrestricted first sale. Thus, the fact that a patented technology can replicate itself does not give a purchaser the right to use replicated copies of the technology. The Federal Circuit concluded that the application of the first sale doctrine to subsequent generations of self-replicating technology would injure the rights of the patent holder, and resultantly upheld the District Court's holding that the patent exhaustion defense is inapplicable.

Antitrust/Misuse
Mr. Scruggs claimed Monsanto violated the Sherman Act §1 and §2 by asserting that the exclusivity provision, no replant policy, and technology fee payments required by Monsanto’s licensing agreement with seed growers are illegal anticompetitive practices. He also argued on appeal that Monsanto was tying the purchase of seed to the purchase of Roundup through grower license agreements, grower incentive agreements and seed partner license agreements, a violation of section 1 of the Sherman Act. Mr. Scruggs also claimed Monsanto unlawfully monopolized or attempted to monopolize a relevant market under §2 of the Sherman Act and misused its patents.

Section 1 of the Sherman Act
The Federal Circuit first analyzed Mr. Scruggs' claim under section 1 of the Sherman Act, specifically, the claim of a tying agreement. The Court stated that a tying arrangement is the sale or lease of one product on the condition that the buyer or lessee purchase a second product. To prove a tying arrangement existed, he was required to show the involvement of two separate products or services; the sale of one product or service being conditioned on the purchase of another; Monsanto’s market power in the tying product; and, the amount of interstate commerce in the tied product was not insubstantial.

In affirming the District Court’s rejection of the anticompetitive claim under section 1 of the Sherman Act, the Federal Circuit stated Monsanto had a right to exclude others from making, using or selling its patented plant technology. Additionally, Monsanto's “no replant policy simply prevents purchasers of the seeds from using the patented biotechnology when that biotechnology makes a copy of itself.” The Federal Circuit further stated Monsanto’s uniform technology fee was essentially a royalty fee which was also within the scope of the patent grant. The Court lastly stated that a no research policy is a field of use restriction and is also within the protection of the patent laws.

The Federal Circuit also found Mr. Scruggs failed to point to sufficient evidence to establish that Monsanto’s behavior constitutes illegal tying, that the grower incentive program was optional and not coerced and that Monsanto’s seed partners were not forced to buy Roundup under the seed partner agreements. As a result, the Federal Circuit affirmed the District Court’s rejection of the claim of an antitrust violation under section 1 of the Sherman Act.

Section 2 of the Sherman Act
The Federal Circuit next analyzed Mr. Scruggs' claim under section 2 of the Sherman Act which prohibits unlawful monopolization. The Court stated that proving a section 2 violation required that the party charged had “monopoly power in a relevant market and acquired or maintained that power by anti-competitive practices instead of by competition on the merits.” The Court affirmed the District Court’s denial of the unlawful monopolization claim under section 2 of the Sherman Act because he failed to provide sufficient evidence proving unlawful monopolization or attempted monopolization.

Patent Misuse
The Federal Circuit also analyzed Mr. Scruggs' claim under the patent misuse doctrine. Although the Court stated patent misuse can be found even where there is no antitrust violation, “the policy of the patent misuse doctrine is to prevent the patentee from using the patent to obtain market benefit beyond that which inures in the statutory right.” Further, the Federal Circuit held that patent misuse requires a party to impermissibly broaden the scope of the patent grant with anticompetitive effect. As such, the doctrine of patent misuse does not extend to a patent owner by reason of his refusal to license or use any rights to the patent, which is within the permissible scope of the granted patent rights.

The Federal Circuit quickly affirmed the District Court’s denial of the claim of patent misuse because patent misuse covers activities falling outside of the patent grant. Specifically, Mr. Scruggs did not point to any activity falling outside Monsanto’s patent. Further, under the patent misuse doctrine, Mr. Scruggs was required to show that the challenged contract had an actual adverse effect on competition, which he failed to do. As such, the Federal Circuit found that Monsanto’s conduct did not amount to patent misuse.

Patent Enforcement By A University Against Customers Insufficient to Waive Sovereign Immunity under Florida Prepaid To Allow the Supplier To File A Declaratory Judgment Action
In Tegic Communications v. Bd. of Regents of the Univ. of Texas System, Civ. Case. No. 05-1553 (Fed. Cir. August 10, 2006), Tegic Communications filed a declaratory judgment in the Western District of Washington against the Board of Regents of the University of Texas System ("the University") due to the University's enforcement of U.S. Patent No. 4,674,112 in the Western District of Texas against 48 cellular-telephone companies. Tegic Communications alleged that, since it supplied allegedly infringing software to 39 of 48 these companies, Tegic Communications was under a reasonable apprehension of suit. Relying on Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, 527 US 627, 51 USPQ2d 1081 (1999), the District Court dismissed the complaint as the University was immune under the Eleventh Amendment from patent infringement claims and had not waived its sovereign immunity for such claims by bringing suit against the 39 companies. The Federal Circuit affirmed the District Court's dismissal.

The Federal Circuit held that, while a State can waive its sovereign immunity by filing a patent infringement suit, the waiver does not extend to non-participants in the suit. Specifically, the mere filing of the patent infringement suit in a Federal court does not act as a full waiver of sovereign immunity through participation in a Federal regulatory process. The waiver extends only to compulsory counterclaims from the defendants in the action. Thus, the filing of the patent infringement suit in Western District of Texas represented only a limited voluntary waiver of sovereign immunity in the Western District of Texas, and does not represent a voluntary waiver extending to non-parties in other Districts. Instead, the Federal Circuit agreed with the District Court that, while Tegic Communications might avail itself of the University's sovereign immunity waiver by intervening in the Western District of Texas action, the University retained its Eleventh Amendment immunity such that the case in Western District of Washington was properly dismissed.

Ability to Petition State Legislature for Patent Infringement Damages Sufficient Remedy Such That Sovereign Immunity Prevents Suit Against University under Florida Prepaid
In Pennington Seed v. Produce Exchange No. 299, et al., 457 F.3d 1334 (Fed. Cir. 2006), Pennington Seed, Inc. and AgResearch Limited (collectively “Pennington”) filed suit against the University of Arkansas (“the University”) for infringement and conversion of U.S. Patent No. 6,111,170 (“the ’170 patent”) in the Western District of Missouri. Relying on Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, 527 US 627, 51 USPQ2d 1081 (1999), the District Court dismissed the complaint as Arkansas was immune under the Eleventh Amendment from patent infringement claims and had not waived its sovereign immunity for such claims. Thus, the University, as a state entity, is also immune. The Federal Circuit affirmed the District Court's dismissal.

Wireless is the assignee of U.S. Patent No. 6,665,173 entitled “Physical Configuration of a Hand-Held Electronic Communication Device.” The lone independent claim of the ‘173 patent provides, “A hand-held, electronic computing device having a physical configuration comprising…an alphanumeric keyboard carried by the body portion…” The Federal Circuit stated the appeal for denial of a preliminary injunction would turn on the correct claim construction of the term “alphanumeric keyboard.”

Relying on the methodology set forth in Phillips v. AWH Corp., 423 F.3d 1303, 75 USPQ2d 1321 (Fed. Cir. 2005) (en banc), the Federal Circuit noted the scope of the term “alphanumeric keyboard” was not readily apparent from the face of the claim and that there was no common dictionary definition of the term. The Court provided that the term must be read in view of the specification of which it is part. The description of the invention in the Summary of Invention section stated that “The keyboard may be a keyboard with a layout such as the common QWERTY layout but not be limited to the particular layout…may include…any other alphanumeric layout that includes a substantially full set of alphanumeric keys.” As a result, the Federal Circuit stated it could not allow Wireless to claim a keyboard with less than a substantially full set of keys “or risk injuring the public’s right to take the patentee at his word.”

The Federal Circuit also noted the specification explicitly referenced the disadvantages of keypads having only twelve digits when it stated, “the keypad is typically a twelve-digit keypad designed for numeric data entry…this method being extremely slow, awkward, error prone, and not appropriate for a device intended to transfer textual data on a regular basis.” The Court stated, “where the specification makes clear that the invention does not include a particular feature, that feature is deemed to be outside the reach of the claims of the patent, even though the language of the claims, read without reference to the specification, might be considered broad enough to encompass the feature in question.” Thus, the specification disclaimed coverage for keyboards such as twelve digit keyboards through such statements.

The Federal Circuit also considered extrinsic evidence including a statement by a Wireless expert witness but found that the expert’s statement was conclusory and unsupported by reference to any contemporaneous document and therefore of no value in the claim construction analysis. As a result, the Federal Circuit held the District Court’s claim construction was correct, that the undisputed evidence established that the accused device utilized twelve keys instead of a substantially fully set of alphanumeric keys and thus affirmed the denial of a preliminary injunction against Sony.

Patent License Term Limiting End Component Combination In Systems Prevents Patent Exhaustion and Implied License From Allowing Non-Authorized Combinations
In LG Electronics, Inc. v. Bizcom Electronics, Inc., Civ. Case Nos. 05-1261, -1262, -1263, -1264, -1302, -1303, -1304, 2006 U.S. App. LEXIS 16916 (Fed Cir. July 7, 2006), all parties appealed from the District Court for the Northern District of California. The Court of Appeals affirmed-in-part, reversed-in-part, vacated-in-part and remanded for further proceedings. A copy of the decision can be found here.

LG Electronics, Inc. (LG) is the owner of patents relating to personal computers including patents 4,918,645; 5,077,733; 4,939,641; 5,379,379; and, 5,892,509. LG sued the defendants alleging infringement of these patents. The defendants purchased microprocessors and chipsets from Intel or Intel’s authorized distributors and installed them in computers. Under an agreement with LG, Intel was authorized to sell the microprocessors and chipsets to all of the defendants. However, pursuant to the agreement between LG and Intel, Intel was required to notify the defendants that although Intel was licensed to sell the products, they were not authorized to combine the products with non-Intel products.

In 2002, LG brought suit against the defendants asserting that the combination of microprocessors or chipsets with other computer components infringes LG’s patents covering those combinations but did not assert patent rights in the microprocessor or chipsets themselves. The District Court, after deciphering the patent claims, granted summary judgment of non-infringement for each patent. The District Court determined that there was no implied license to any defendant, however, with the exception of the ‘509 patent, LG’s rights in any system claims were exhausted. It also found that LG was contractually barred from asserting infringement of the ‘509 patent against the defendants and found the ‘645, ‘733 and ‘379 patents were not infringed after applying claim construction to the accused methods and devices.

Implied Licensing
Reviewing the District Court's granting of summary judgment without deference, the Federal Circuit first considered the issue of implied licensing. “In a suit for patent infringement, the burden of proving the establishment of an implied license falls upon the defendant.” Bandag, Inc. v. Al Bolser’s Tire Stores, Inc., 750 F.2d 903, 924 (Fed. Cir. 1984). The Federal Circuit stated that the defendants were required to establish that the products have no noninfringing uses and that the circumstances of the sale…plainly indicate that the grant of a license should be inferred. Concluding that no implied license existed between LG and the defendants, the Court stated that because Intel expressly informed them that Intel’s license agreement with LG did not extend to any of defendant’s products made by combining an Intel product with a non-Intel product no license could be implied.

Patent Exhaustion
The Federal Circuit next considered the issue of patent exhaustion for each of LG’s patents. It stated, “an unconditional sale of a patented device exhausts the patentee’s right to control the purchaser’s use of the device thereafter…however, the exhaustion doctrine does not apply to an expressly conditional sale or license. In such a transaction, it is more reasonable to infer that the parties negotiated a price that reflects only the value of the use rights conferred by the patentee.”

The Federal Circuit found the LG-Intel license expressly disclaimed granting a license allowing computer system manufacturers to combine Intel’s licensed parts with other non-Intel components. It further found that this conditional agreement required Intel to notify its customers of the limited scope of the license and although Intel was free to sell its microprocessors and chipsets, those sales were conditional and Intel’s customers were expressly prohibited from infringing LG’s combination patents. As a result, the Federal Circuit held LG’s rights in asserting infringement of its systems claims were not exhausted, reversing the District Court’s holding with respect to the system claims. With respect to the method claims, the Federal Circuit also found that even if the exhaustion doctrine were applicable to method claims, it would not apply in the LG case because there was no unconditional sale. It held that a sale of a device does not exhaust a patentee’s rights in its method claims and resultantly affirmed the District Court's holding with respect to the method claims.

The ‘509 Patent: "Control Unit" Term Does Not Invoke 35 U.S.C. 112, Para. 6
The Federal Circuit next reviewed the District Courts granting of summary judgment of non-infringement on the ground that LG was contractually barred from asserting infringement against the defendants with respect to the ‘509 patent. The Federal Circuit held that because a genuine issue of material fact existed as to whether the defendants fell within the protection of a contract provision between LG and Microsoft barring LG from suing Microsoft, its suppliers, their subsidiaries or their licensees, it reversed the District Court’s granting of summary judgment of non-infringement. On remand, the defendants must establish that LG is contractually barred from pursuing infringement claims against them.

Because the parties also disputed the District Court’s construction of several claim terms in the ‘509 patent, the Federal Circuit also reviewed the District Court's finding that claim 35 was a means-plus-function. LG claimed the District Court erred when it construed the term “control unit” as a means-plus-function limitation. The Federal Circuit stated “A claim that does not use means will trigger the rebuttable presumption that §112 AP 6 does not apply…but this presumption can be rebutted by showing that the claim element recites a function without reciting sufficient structure for performing that function.” The Federal Circuit held the claim limitation at issue does not use the term means such that there is a presumption that the claim term is not a means plus function claim. Additionally, the Federal Circuit found that the claim recited specific structure, including a CPU and a memory, such that the presumption against means-plus-function treatment is not overcome. Thus, the Federal Circuit held that the recited control unit is not written in means plus function form.

The ‘645 Patent: "Requesting Agent" Defined Based On Intrinsic Evidence and Industry Standard
In reviewing the District Court's interpretation of the recited term "requesting agent," the Federal Circuit held the District Court erred when it failed to give proper weight to the incorporated industry standard and failed to consider the standard as intrinsic evidence of the meaning to one of ordinary skill in the art as of the filing date. Thus, the Federal Circuit concluded that LG’s proffered definition based on the standard is correct and thus, the term “requesting agent” meaning “an agent that has entered into the arbitration function for bus access” was entirely consistent with the specification.

The Federal Circuit found that while prosecution history is relevant to claim construction, it often lacks the clarity of the specification and thus is less useful for claim construction purposes. Further, while it agreed with the District Court that the patentee (LG) did not act as its own lexicographer, the specification made clear that the term requesting agent is properly construed to mean an agent that has entered into the arbitration function for bus access.

A Foreign Unpublished Patent Application Is a “Printed Publication” Under §102.

In Bruckelmyer v. Ground Heaters, 445 F.3d 1374 (Fed. Cir. April 20, 2006), petition for reh'g denied (June 28, 2006), the Court of Appeals for the Federal Circuit affirmed the lower court’s summary judgment invalidating plaintiff Bruckelmyer’s patents 5,567,085 and 5,820,301.

Bruckelmyer’s patents were for using flexible tubes carrying heated liquid to thaw frozen ground so as to permit proper curing of concrete. Thirteen years prior to Bruckelmyer’s filing, Norman Young filed an application which eventually issued as Canadian Patent 1,158,119. Young’s patent was for a portable heating system using flexible hoses with the primary purpose of conditioning ground for concrete pouring, although thawing frozen ground was not the objective. Two illustrations accompanied Young’s application and illustrated the use of the invention to thaw frozen ground. These two illustrations did not accompany the issued patent because they were cancelled; however, they were still available in the file wrapper during the critical period.

In 2002, Bruckelmyer sued Ground Heaters for infringement. Ground Heaters counterclaimed, asserting invalidity based on the two illustrations in Young’s ‘119 patent application, and filed a motion for summary judgment. The district court determined that the illustrations in the file wrapper were “sufficiently accessible to the relevant and interested public” to be a “printed publication” under 35 U.S.C. §102(b), which forbids patents on inventions “described in a printed publication … more than one year prior to the date of filing in the U.S.” However, the district court denied Ground Heater’s motion for summary judgment to resolve whether the illustrations were sufficient to enable a person of ordinary skill in the art to practice the invention in the ‘085 and ‘301 patents.

Disagreeing that the illustrations were “printed publication[s],” Bruckelmyer filed a stipulation conceding that the illustrations permitted the practice of the ‘085 and ‘301 patents, upon which Ground Heaters successfully renewed their motion for summary judgment. Bruckelmyer then appealed to the Court of Appeals for the Federal Circuit on the single issue of whether the two illustrations of the ‘119 patent are printed publications under § 102.

The Court of Appeals analyzed the case under the precedent of In re Wyer, 655 F.2d 221 (CCPA 1981), where an Australian patent application was available to the public and an abstract of the application was published. According to Wyer, a reference meets the standard of § 102 if “such document has been disseminated or otherwise made available to the extent that persons interested and ordinarily skilled in the subject matter or art exercising reasonable diligence, can locate it …” Id. at 226. In Wyer, the published application abstract was considered a sufficient roadmap to the application to meet this standard. In the current case, the court reasoned that the published ‘119 patent was an even better research aid in finding the application file wrapper; thus the file wrapper was publicly available.

The court also clarified its holding in In re Cronyn, a case where several student theses were found to not be publicly accessible, in part because they were not meaningfully catalogued or indexed. 890 F.2d at 1161. The court found Bruckelmyer’s reliance on Cronyn to be misplaced, noting that indexing or cataloguing is not a necessary element, but relevant only to establishing if one ordinarily skilled in the art could locate these references. Whether the file wrapper in this case was indexed or catalogued “in a meaningful way” was irrelevant, according to the court, since the ‘119 patent was certainly indexed and would lead a person of reasonable diligence to the application wrapper.

A short dissent by Judge Linn questioned the suitability of a granted patent as an “index” to the patent application, especially when, as in this case, the patent itself contained little to indicate that the drawings in the file wrapper disclosed subject matter not discussed in the patent itself.

A copy of the decision is available at Bruckelmyer v. Ground Heaters, 445 F.3d 1374 (Fed. Cir. April 20, 2006)

Following this case, the Court of Appeals for the Federal Circuit denied Bruckelmyer’s request for rehearing en banc. Judge Newman argued forcefully in dissent that a file wrapper only available by traveling to a foreign country and which discloses an invention not mentioned in the resulting patent is not a “printed publication” under any reasonable interpretation of the term. (Fed. Cir. Case No. 2005-1412). Yet the Court’s judgment stands, arguably expanding the realm of available prior art.

A copy of the denial of rehearing and Judge Newman’s dissent is available here.

FEDERAL CIRCUIT DEFINES CLAIMS IN CONTINUATION APPLICATIONS SIMILARLY EVEN WHERE CLAIMS DIFFERENTLY WORDED
In Advanced Cardiovascular Sys, Inc. v. Medtronic Vascular, Inc.., Civ. Case Nos. 05-1280, 05-1281, 05-1282 (Fed Cir. May 26, 2006) (non-precedential), the Federal Circuit affirmed a district court decision of granting a summary judgment of non-infringement of Medtronic’s U.S. Patent No. 5,292,331 (the ‘331 patent), U.S. Patent No. 5,674,278 (the ‘278 patent), U.S. Patent No. 5,879,382 (the ‘382 patent), and U.S. Patent No. 6,344,053 (the ‘053 patent), which are drawn to stent devices and methods of delivery and manufacture and all of which are related patents.

In interpreting the claims of the ‘331, ’278, ‘382, and the ‘053 patents at trial, the District Court had found that the terms “circular member”, “stent member,” “ring”, and endovascular support member” have the same meaning as a “stent.” The Federal Circuit upheld this construction since, while used in different claims and in different patents, these terms had no clear meaning from the specification and were “employed in a manner analogous to and interchangeable with the term ‘stent’.”

Further, in interpreting the term “stent,” the District Court found that Medtronic had clearly disavowed any stent not having straight segments ending at peaks. Specifically, during prosecution of the ‘331 patent, Medtronic asserted that the invention distinguished over the prior art since the stent used substantially straight segments connected to form ends, and that the ends must be at top or bottom. The Federal Circuit agreed that this assertion in prosecution was sufficient to disavow any additional element being used on the recited stent ends.

Moreover, even though the disavowal was arguably broader than necessary to overcome the prior art, the Federal Circuit held that “’there is no principle of patent law that the scope of a surrender of subject matter during prosecution is limited to what is absolutely necessary to avoid a prior art reference. Norian Corp. v. Stryker Corp., 432 F.3d 1356, 1361-62 (Fed. Cir. 2005).” Since the broader disclaimer was applied to the claims of the ‘331 patent, this same disavowal applied to the remaining continuation patents: the ‘278 patent, the ‘382 patent, and the ‘053 patent. The Federal Circuit relied upon a statement in the prosecution of each of the the ‘278 patent, the ‘382 patent, and the ‘053 patent that the claims were allowable “for at least the same reasons as the parent application.”

Also, while acknowledging that certain of the claims, such as in the ‘053 patent, do not recite an “end”, the Federal Circuit found that the claims instead recited a “turn,” which is used in the specification and claims use the term “turn” synonymously with “end,” the claims of the ‘053 patent also recite an end and are subject to the disavowal in the parent application.

Lastly, the Federal Circuit found that no doctrine of equivalents was available for the recited “stent” and the synonymous terms in any of the patents due to prosecution history estoppel due to prosecution history estoppel caused by the broad disavowal in the ‘331 patent.

A copy of the case is available at Advanced Cardiovascular Sys, Inc. v. Medtronic Vascular, Inc.., Civ. Case Nos. 05-1280, 05-1281, 05-1282 (Fed Cir. May 26, 2006).

FEDERAL CIRCUIT USES SUMMARY OF THE INVENTION TO BROADEN RECITED “FORM SET” TO ENCOMPASS A SINGLE SHEET AS WELL AS MULTIPLE SHEETS
In Paymaster Technologies, Inc. v. United States, Civ. Case Nos. 05-5025, 05-5029 (Fed Cir. May 2, 2006), the Federal Circuit affirmed a Court of Federal Claims decision finding the United States was liable under 28 U.S.C. 1498 for the unauthorized use of Paymaster Technologies’ U.S. Patent No. 5,292,283 (the ‘283 patent) since the United States’ use of a money orders.

The claimed invention of the ‘283 patent is directed to money orders having a form set and which has a sheet allowing ink to permeate from a front of the sheet to a back surface to create a mirror image on the back surface. The United States was using two types of money orders at issue: a five ply money order having three sheets on which indicia are copied and ink-infused transfer layers between each of the sheets, and a singly ply money order in which the ink penetrates the first sheet and the remaining sheets are stored electronically. The Court of Federal Claims found infringement under 28 U.S.C. 1498 for both types of money orders.

On appeal, the Federal Circuit agreed with the Court of Federal Claims that the recited form set includes singly ply form sheets, and does not require multiple sheets per form set. The Federal Circuit noted that, while claims 1 and 5 recite three sheets, claim 10 does not recite multiple sheets. Further, the specification contained an example of a negotiable instrument sheet as the form set without requiring multiple sheets in the summary of the invention. While the detailed description had no specific example of a form set with only one sheet, the detailed description was entitled “Description of a Preferred Embodiment.” According to the Federal Circuit, “it is axiomatic that claims are only rarely, if ever, construed as limited to the preferred embodiment.” As such, in view of the summary of the invention, the Federal Circuit found that a form set can include a single sheet.

The Federal Circuit further held that the term “on” does not require that the ink “on” the back surface permeate through the back surface so long as the ink is on the surface. The Federal Circuit noted that this construction is consistent with the specification, is consistent with the extrinsic evidence set forth in dictionaries, and is consistent with the actual usage in the claims.

Lastly, the Federal Circuit upheld the royalty rate of 3.5% awarded by the Court of Federal Claims.

A copy of the case is available at Paymaster Technologies, Inc. v. United States, Civ. Case Nos. 05-5025, 05-5029 (Fed Cir. May 2, 2006).

FEDERAL CIRCUIT FINDS NON-INFRINGEMENT JUDGMENT SINCE CLAIMED “RIGID” DOES NOT ENCOMPASS SEMI-RIGID
In Schoenhaus v. Genesco, Inc., 78 USPQ2d 1252 (Fed Cir. 2006), the Federal Circuit affirmed a district court decision of granting a summary judgment of non-infringement of Schoenhaus’ U.S. Patent No. 5,174,052 (the ‘052 patent) based on the absence of a claimed element from the accused product.

The claimed invention of the ‘052 patent is directed to an orthotic device for preventing hyperpronation of a human foot. During the prosecution of this patent, the inventors approached the defendants attempting to arrange a license agreement. After the signing of a confidential disclosure agreement, the defendant entered negotiations with the inventors for 2-1/2 years, but ultimately withdrew from the negotiations. About 8 years later, in 2002, the inventors discovered that the defendants were selling a line of footwear which they believed to infringe the claims of the ‘052 patent. The inventors filed suits against the defendants alleging infringement of the ‘052 patent, as well as misappropriation of trade secrets and unjust enrichment. The defendants filed a counterclaim of invalidity.

On January 10, 2005, the district court granted a summary judgment of non-infringement. The inventors appealed.

The claims of the ‘052 patent are directed to an orthotic shoe device designed to prevent flatting of the foot arch. Genesco’s accused footwear had a rear heel portion of the upper of the shoe to provide support, rather than only an insert. The issue on appeal was whether the claimed “orthotic device” was limited to a discrete insert that was removable or immovable from a shoe, or whether the term encompassed other parts of a shoe.

During trial, the Plaintiffs attempted to define the use of the term "ridged" in the patent to mean "semi-ridged" in hopes of making the claims broad enough to cover the allegedly infringing footwear. However, the Federal Circuit noted the specification of the ‘052 patent refers to the term "semi-ridged" as a material to be used in the manufacture of the orthotic insert, instead of the resulting product itself. The Federal Circuit also noted that there was no support for the term “ridged” in the file history. Therefore, the Federal Circuit concluded that “rigid” could not include “semi-rigid.” The Federal Circuit reasoned that if one was to substitute each proposed construction for the claimed “orthotic device,” this term could only encompass an “insert or immovable insert portion” because an illogical and inconsistent construction would result if the term read on any part of the shoe. Accordingly, the Federal Circuit affirmed the district court’s decision.

A copy of the case is available at Schoenhaus v. Genesco, Inc., 78 USPQ2d 1252 (Fed Cir. 2006).

CLAIM PREAMBLE IS LIMITING WHEN IT RECITES ESSENTIAL STRUCTURE OF INVENTION
In Bicon v. Straumann, Civ. Case No. 05-1168 (Fed. Cir. March 20, 2006), Appellant Diro, Inc. (“Diro”) and Diro’s licensee Bicon, Inc. (“Bicon”) owned U.S. Pat. No, 5,749,731 (“the ‘731’ patent”). The '731 patent is directed towards a plastic cuff that is designed to preserve a space around a dental implant so that when a dental crown is placed on top of the implant, the base of the crown can fit beneath the patient’s gum line. The preamble of claim 5 of the ‘731 patent reads as follows:

An emergence cuff member for use in preserving the interdental papilla during the procedure of placing an abutment on a root member implanted in the alveolar bone of a patient in which [a] the abutment has a frusto-spherical basal surface portion and [b] a conical surface portion having a selected height extending therefrom comprising …[e] the bore having a taper generally matching that of the conical surface portion of the abutment …(claim elements a-d and f-h omitted for simplicity).

The U.S. District Court for the District of Massachusetts granted summary judgment of noninfringement on several grounds. The court held that claim 5’s preamble was an integral part of the claim and thus limited the claim. Since Straumann’s devices did not incorporate one of the limitations in the preamble, the court held that Straumann did not infringe the ‘731 patent. The court also held that Straumann’s devices did not literally or equivalently infringe claim 5 because they did not read on claim element [e]. The court also held that licensee Bicon did not have standing to sue Straumann since Bicon was not an exclusive licensee of Diro, and thus dismissed Bicon as a party plaintiff.

On appeal, the Federal Circuit held that the preamble is regarded as limiting. Specifically, the Federal Circuit noted that a preamble is considered to be limiting if the preamble recites essential structure that is important to the invention or necessary to give meaning to the claim. In the '731 patent, the preamble of claim 5 is not limited to stating the purpose or intended use of the invention, but contains structural features of the abutment. Further, the body of the claim referred back to features of the abutment described in the preamble, so that the references to the abutment in the body of the claim derive their antecedent basis from the preamble. If claim 5 is not limited to the particular abutment described in the preamble, then elements [e] and [h] of claim 5 become meaningless. As such, the Federal Circuit upheld the District Court's summary judgment on the issue of no literal infringement.

Additionally, the Federal Circuit upheld the finding of no infringement under the doctrine of equivalents since claim 5 recites specific convex shapes not found in the accused device. Quoting SciMed Life Sys., Inc. v. Advanced Cardiovascular Sys., Inc., 242 F.3d 1337, 1346 (Fed. Cir. 2001), the Federal Circuit held that, as in claim 5, “by defining the claim in a way that clearly excluded certain subject matter, the patent implicitly disclaimed the subject matter that was excluded and thereby barred the patentee from asserting infringement under the doctrine of equivalents.” As such, the Federal Circuit also upheld the District Court's finding of no infringement under the doctrine of equivalents.

A copy of the case is available at Bicon v. Straumann, Civ. Case No. 05-1168 (Fed. Cir. 2006).

OPINION LETTER DOES NOT PROVIDE DEFENSE TO CHARGE OF WILLFUL INFRINGEMENT WHERE IMPORTANT TECHNICAL DOCUMENT IS WITHHELD FROM LEGAL COUNSEL.
In nCube Corp. v. SeaChange International, Inc., 436 F.3d 1317; 77 U.S.P.Q.2D (Fed. Cir. 2006), a panel of the Court of Appeals for the Federal Circuit affirmed the trial court’s upholding of the jury’s finding of infringement, damages and partial attorney’s fees and granting infringer’s JMOL motion on infringement under the doctrine of equivalents. J. Rader, writing the opinion for the Court, found the trial court correctly construed the claims of nCube’s patent (U.S. Patent No. 5,805,804, hereinafter referred to as the '804 patent) to encompass SeaChange’s systems used by cable TV networks.

On the issue of claim construction, the Federal Circuit upheld the District Court's interpretation. Specifically, the ‘804 patent claims a particular server for connecting a client to a multimedia experience. The server accomplishes this by using an upstream manager to send requests from the client, a downstream manager to send the requested multimedia content to the client, and a service to maintain connections across networks to accomplish the delivery of the upstream and downstream communications. According to the Federal Circuit, the District Court’s claim construction correctly did not require all communications to go through the upstream manager since the specification suggested another embodiment. The District Court was also upheld in not requiring all communications to use a logical address to route the packets of information in the communications across various non-uniform networks even though the logical address was the only embodiment in the specification since the requirement for the logical address was in the depending claims, thereby implying that the independent claim was broader. Based on evidence including one expert’s testimony, the jury found SeaChange’s systems infringed the ‘804 patent.

The jury also found willful infringement which, “hinges on when the defendants had actual knowledge of plaintiff’s patent rights, and their actions after that time.” nCube, pg. 10. The willful infringement took place after nCube filed suit giving Seachange actual knowledge of the ‘804 patent and thus triggering an affirmative duty of due care to avoid infringement on the part of SeaChange. Rolls-Royce Ltd. v. GTE Valeron Corp., 800 F.2d 1101, 1109 (Fed.Cir.1986). In order to show compliance with this duty of care, Seachange relied (ultimately to its detriment) on an opinion letter obtained after suit was filed, which counsel shared with SeaChange management. The Federal Circuit found in the record that SeaChange failed to supply at least one important technical document to SeaChange's opinion counsel. Thus, “the best information [was] intentionally not made available to counsel during the preparation of the opinion, [so that] the opinion can no longer serve its prophylactic purpose of negating a finding of willful infringement.” Comark Commc’ns, Inc. v. Harris, Corp., 156 F.3d 1182, 1191 (Fed. Cir. 1998). Willfulness was thus properly found since the infringer, having received notice when the suit was filed, obtained an opinion upon of noninfringement which the infringer could not reasonably rely upon in continuing to infringe.

A copy of the case is available at nCube Corp. v. SeaChange International, Inc., Civ. Case. No. 03-1341 (Fed. Cir. Jan. 9 2006).

RESPONSE TO RFP READING ON PATENT CLAIM DOES NOT CONSTITUTE OFFER TO SELL INFRINGING DEVICE WHERE RESPONSE DID NOT ACTUALLY OFFER INFRINGING DEVICE
In FieldTurf Intr., Inc. et al. v. SprinTurf, Inc. et al. and SportFields LLC and Orion, 433 F.3d 1366, 77 U.S.P.Q.2D 1468 (Fed. Cir. 2006), the Federal Circuit affirmed a summary judgment of non-infringement in favor of SportFields LLC and Orion (collectively “SportFields”) and reversed summary judgment in favor of SportFields on its counterclaims of intentional interference with prospective economic advantage and unfair competition, and vacated the award of attorney fees.

This case related to a Request for Proposal (RFP) issued by a School District in California for synthetic grass turf. SportFields, a producer of synthetic turf, initially complained to the school district that the RFP specifications “sole sourced” the FieldTurf product such that other offerors could not provide a competing proposal using equivalent goods. The RFP specifications were amended, but still contained claim elements of U.S. Patent No. 5,958,257 (the '257 patent) and U.S. Patent 6,338,885 (the '885 patent), owned by FieldTurf. SportsFields on the amended RFP was the low bidder for award of the project. FieldTurf then advised the School District and Sportfields that SportsFields' bid constituted an infringing “offer to sell’ of the '257 and '885 patents under 35 U.S.C. § 271(a). The School District then withdrew the RFP and further amended the RFP specification to depart from FieldTurf’s patents, with Fieldturf not bidding and the project being awarded to Sportfields.

On the issue of whether an offer for sale occurred, the District Court held that the bid to the withdrawn RFP did not constitute an infringing offer to sell under 35 U.S.C. § 271(a). The Federal Circuit, in affirming District Court’s non-infringement determination, considered whether SportFields’ bid constituted an “offer to sell” an infringing product under 35 U.S.C. § 271(a) and, whether the District Court erred in considering the identity of the product that SportsField actually intended to provide in its non-infringement determination. The Federal Circuit held that the District Court did not err in considering the nature of the SportsFields product that was intended and understood to be the product that would be installed, in holding that Sportsfields’ bid was not an offer to sell an infringing product under 35 U.S.C. § 271(a). The Federal Circuit stated that the District Court was not required to ignore these and other facts that showed that Sportsfields intended to offer and install its product, which was conceded not to literally infringe FieldTurf's patent claims.

On the issue of intentional interference with prospective economic advantage and unfair competition, the District Court’s had found in favor of SportFields. The Federal Circuit reversed the District Court’s determination in favor of SportFields and considered whether SportsFields’ bid on the Request for Proposal (RFP) specifications, as initially written, constituted a reasonable belief that SportsFields was offering a product that infringed FieldTurf's '257 and '885 patents. The Federal Circuit held that at the time of SportsFields’ bid on the RFP specifications, as initially written, FieldTurf could reasonably have believed that SportsFields was offering a product that infringed FieldTurfs’ patents. The Federal Circuit further held that enforcement of a patent that is reasonably believed to be infringed is not an act of unfair competition, citing Mikohn Gaming Corp. v. Acres Gaming, Inc., 165 F.3d 891, 897 (Fed. Cir. 1998). The Federal Circuit also noted that it is not unfair competition for a patentee to enforce its patent against a competitor, citing Concrete Unlimited v. Cementcraft, Inc., 776 F.2d 1537, 1539 (Fed. Cir. 1985). Thus, by asserting its patent rights on patents reasonably believed to be infringed, FieldTurf was not committing acts of unfair competition.

A copy of this case is available at FieldTurf Intr., Inc. et al. v. SprinTurf, Inc. et al. and SportFields LLC and Orion, No. 04-1553 (Fed. Cir. 2006)

TERM "ASSOCIATE" REQUIRES DEVICE SPECIFIC ASSOCIATION FOR PURPOSES OF CLAIM CONSTRUCTION AND DOES NOT READ ON DEVICE INDEPENDENT STYLES
In MicroStrategy, Inc. v. Business Objects, S.A., 429 F.3d 1344, 77 U.S.P.Q.2D 1001 (Fed. Cir 2005), the Federal Circuit affirmed the District Court’s granting of summary judgment of non-infringement in favor of Business Objects. The District Court had reached its result after interpreting the claims to require an association of output devices with “device-specific style” on a device-by-device basis. The parties dispute whether, as claimed, the system and method must associate various output devices with the “device-specific style” on a device-by-device basis.

Claim 8 is representative of the disputed language and reads:

8. A method for generating output from an on-line analytical processing system to user output devices comprising the steps of: processing at least one scheduled service in an on-line analytical processing system according to a schedule established for the service and generating a service output, each service comprising at least one query to be performed by the on-line analytical processing system and at least one user device subscribed to that service; enabling a plurality of subscribers to subscribe to the scheduled service and enabling the subscriber to specify at least one user output device at which to receive service outputs from the service; wherein each user device subscribed to that service is associated with a device-specific style that designates the format in which that particular type of user device is to output to the service outputs to a user to maintain the integrity of the service outputs; determining whether to forward the generated output to one or more user devices based on output conditions specified for each user device subscribed to the service; creating a device-specific formatted output for each user device subscribed to the service selected to receive the output according to a selection of predefined values specified for each of a plurality of predefined parameters provided by the style specified for the user output device, and automatically forwarding a device-specific formatted service output to each of the user output devices selected to receive the output for that service; wherein the determining step comprises determining whether each user device subscribed to the service is an alert subscription or a periodic subscription and selecting the user device if it is a periodic subscription or if an alert condition specified in the alert subscription has been satisfied. (emphases added).

The District Court construed the remaining claim language on summary judgment. Based on the claim language, the District Court “conclude[d] … that the system or method [must] function on a device-by-device basis.” The District Court’s interpretation focused on two aspects common to the three independent claims: “(1) each user device is associated with a device-specific style, and (2) output is created for each user device according to the style specified for the user output device.” Id. (emphasis in original). Thus, the District Court concluded that the claim language requires association of output devices with a device-specific style on an individual, device-by-device basis. Id. In other words, the invention requires a particular format and presentation for one device, e.g. mobile phone data, that could differ from the format for a second device, e.g., electronic mail data. The District Court summarized its conclusion as follows:

[T]he patent covers methods and systems that retain associations between individual devices and device styles … because only in that manner does the patent cover systems that handle multiple device types or customization of subscription features on a subscriber-by-subscriber or device-by-device basis… While it is not necessary that the devices always be different, the system or method described in the claims is structured to facilitate the transmission of the same output to multiple device types.

The Federal Circuit determined, to the contrary, that all three independent claims require that each user output device subscribe to a service associated with a device-specific style. The term “associate” implies that the system creates a link between user output devices and corresponding “styles.” In other words, the system must identify and track in some manner the “style” in which a particular user output device receives and displays output. This claim language further requires a direct link between each user output device, individually and a corresponding “device-specific style”.

In addition, the Federal Circuit felt that the claims require a device-specific formatted output according to a style specified for each device. The Federal Circuit agreed with the District Court that the words “specified” and “each” reaffirm that these claims require individual, device-by-device association. Moreover, the ultimate creation of a “device-specific” format requires at least two different device-specific styles. Otherwise, the references in the claims to individualized, device-by-device association with styles with user output devices and corresponding creation of another device-specific formatted output would be meaningless.

The specification of the Microstrategy Patent ensures the system automatically forwards output from the services to one or more subscriber output devices specified for that service. The Federal Circuit indicated that while this paragraph does state this system may ultimately forward output to only “one” output device, it does not address at all a minimum capacity to support a number of output formats (e.g. only one). Instead, this paragraph is open to an interpretation requiring support from multiple types of subscriber output devices, even though, in practice, all the subscribers may receive the subscription via only one format (e.g. e-mail or in another suitable format). Therefore, this paragraph does not conflict with the claim construction applying support for multiple device types or an association of styles with devices on an individual, device-by-device basis. The Federal Circuit noted that the District Court read the specification correctly in its well-reasoned decision.

The product of Business Object, the Broadcast Agent Publisher (Publisher) Software is only designed to be run with email. In other words, the recipient output device is simply an email address. It was noted by the District Court, and agreed to by the Federal Circuit, the Publisher “does not make any association between the [output devices] and the format. The system does not know what the devices are or the styles that the device needs to properly receive and display output.” Rather, “[i]t only supports one style per publication.” Thus, Publisher does not provide an association between devices and device-specific styles on a device-by-device basis as required by the Court’s claim construction. For at least this reason, the Federal Circuit held that the District Court properly concluded that business objects does not literally infringe the ‘050 patent.

A copy of the case can be found at MicroStrategy, Inc. v. Business Objects, Civ. No. 04-1572 1344 (Fed. Cir 2005).

LACK OF ANTECEDENT BASIS DOES NOT AUTOMATICALLY RENDER CLAIM INDEFINITE WITHOUT EVIDENCE OF CONFUSION AS TO CLAIM SCOPE
In Energizer Holdings, Inc. v. International Trade Commission, Energizer Holdings brought an action under 19 U.S.C. §1337 to prevent the importation of alkaline battery cells which Energizer asserted infringed claim 1 of Energizer's U.S. Patent No. 5,464,709. Claim 1 recites as follows:

1. An electrochemical cell comprising an alkaline electrolyte, a cathode comprising manganese dioxide as an active cathode component, and an anode gel comprised of zinc as the active anode component, wherein the cell contains less than 50 parts of mercury per million parts by weight of the cell and said zinc anode has a gel expansion of less than 25% after being discharged for 161 minutes to 15% depth of discharge at 2.88A.

On appeal, the Federal Circuit reviewed the International Trade Commission's finding of invalidity de novo since the issue is strongly intertwined with claim construction. The Federal Circuit also noted that, while the lack of antecedent basis can cause indefiniteness, invalidity based upon indefiniteness must be based on the totality of the claim as read in the context of the specification by one skilled in the art. According to the Federal Circuit, "[w]hen the meaning of the claim would reasonably be understood by persons of ordinary skill when read in light of the specification, the claim is not subject to invalidity upon departure from the protocol of 'antecedent basis.'" As such, the Federal Circuit held that the requirement of antecedent basis is "a rule of patent drafting, administered during patent examination," and is not an automatic grounds for invalidity.

Based upon this test, the Federal Circuit that there is no evidence that the scope of the claim was not understood by one of ordinary skill in the art, and that "the Commission nor the Intervenors argued that they did not understand the intended scope because of the absence of an antecedent." Further, the Federal Circuit noted that the Examiner, during prosecution, made several other rejections but also did not make a rejection regarding a lack of antecedent basis, which evidenced that the scope of the claim was understandable and definite. Thus, the Federal Circuit held that the International Trade Commission erred in finding claim 1 invalid under 35 U.S.C. §112, and reversed and remanded the case for further proceedings. For additional information, please refer to Energizer Holdings, Inc. v. International Trade Commission, Civ Case No. 05-1018 (Fed. Cir. January 25, 2006)

Patent Owner Retains Standing to Enforce Patent After Exclusive License If Exclusive License Does Not Transfer All Substantial Ownership Rights
In Aspex Eyewear, Inc. v. Miracle Optics, Inc., Contour and Aspex sued Miracle for infringement of U.S. Patent No. 6,109,747 (hereinafter referred to as the '747 patent). The ’747 patent was originally assigned by the inventor to Contour. After this assignment, Contour and nonparty Chic Optic, Inc. executed an agreement that gave Chic Optic, Inc. certain rights under the ’747 patent, including exclusive right to make, use and sell the product in the United States, the first right to commence legal action against third parties for infringement and virtually unlimited right to sublicense all of its rights to third parties. Under the agreement, Contour retained the right to commence legal action against third parties for infringement if Chic refused to do so, and the agreement contained a clause providing an expiration date for the agreement, a single option to extend, and a second expiration date if the option to extend was exercised. The expiration date was well before the expiration date of the patent. Chic sublicensed all of its rights to the patent to Aspex, Inc. This sublicense was not entered into until after Contour and Aspex had sued Miracle for infringement.

The U.S. District Court for the Central District of California dismissed the suit on the grounds that neither Contour nor Aspex had standing to sue because neither possessed the “rights of the patentee” at the time that the original complaint was filed.

The Federal Circuit held that Contour had standing to sue because its agreement with Chic did not transfer all substantial rights to the ’747 patent. The Court found that the most important factor was the provision limiting the term of the agreement with Chic. Because of this provision, the Court found that Chic was an exclusive licensee and not an assignee. The Court reasoned that if Chic were considered to be the assignee of all rights under the patent, the risk of multiple lawsuits would increase, since Chic could assert the patent against an accused infringer during the term of the agreement and then, when Contour regained its rights after the termination of the agreement, Contour could bring an infringement action against the same infringer. The Court vacated the District Court decision that Contour lacked standing to sue and remanded the case to the District Court to determine whether Chic was a necessary party that should have been joined. For additional information, see Aspex Eyewear, Inc., et al. v. Miracle Optics, Inc, et al, Cov. Case. No. 04-1265 (Fed. Cir. January 10, 2006).

Use of Word "a" in Claim Limited Scope To A Single Element
In Norian Corp. v. Stryker Corp., the Federal Circuit affirmed the District Court's grant of summary judgment of non-infringement based upon a narrow interpretation of the claim term "a." Specifically, Norian asserted infringement based upon claims 8-10 of U.S. Patent No. 6,002,065. Claim 8 recites, among other features "a solution consisting of water and a sodium phosphate" with the sodium phosphate being in concentration of 0.01 to 2.0 M. Claims 9 and 10 depend from claim 8 and recite different amounts of the sodium phosphate. The District Court held that the solution recited in claim 8 requires a mixture having the recited range for a single type of sodium phosphate and does not cover solutions with mixtures of sodium phosphates. Since Stryker's accused solution includes a mixture of different types of sodium phosphates (i.e., monobasic sodium phosphate and dibasic sodium phosphate), the District Court held that there was no single type of sodium phosphate meeting claim 8.

In affirming the District Court's opinion, the Federal Circuit noted that, while claim 8 recites "at least one calcium source" and "at least one phosphoric acid source," claim 8 does not recite at least one sodium phosphate. According to the Federal Circuit, if Norian had intended to cover more than one type of sodium phosphate, "it would have been simple to use the same language."

Additionally, the Federal Circuit noted that, while the word "a" is generally open ended and means more than one, "a" is only open ended when open ended claim terminology is used. As such, the word "a" following "comprising" can mean more than one. However, where closed terminology such as "consisting of" is used or where there is evidence in the prosecution history that the word "a" is intended to mean a single item as opposed to more than one item, the word "a" is limited to a single item. Since claim 8 uses closed terminology (consisting of), the District Court's interpretation is supported by the claim language by itself.

Lastly, the Federal Circuit noted that, even assuming closed terminology was not used, the specification and the prosecution history support the more narrow interpretation. Specifically, while each of the disclosed examples uses only a single sodium phosphate in the example solutions, there is no example or suggestion in the specification that a solution has multiple sodium phosphates. The Federal Circuit further noted that, during prosecution, Norian had further made representations that the solution includes only a single sodium phosphate, and had represented to the Examiner that the specification's examples show that the scope of the claimed invention was explicitly for sodium phosphates used individually and not in combination. As such, the Federal Circuit upheld the District Court's dismissal on the basis of non-infringement.

A copy of the case can be found at Norian Corp. v. Stryker Corp. 2005 U.S. App. LEXIS 26528, Civ. Case No. 05-1172 (Fed. Cir. December 6, 2005).

Claim Directed to Both System and Method Found Indefinite
In IPXL Holdings v. Amazon.com, IPXL sued Amazon.com alleging that Amazon's "1-click" system infringed U.S. Patent No. 6,149,055 (the '055 patent). The District Court for the Eastern District of Virginia found that Amazon's system did not infringe and that the asserted claims of the '055 patent were invalid. The District Court had found most of the asserted claims anticipated under 35 U.S.C. §102. For the remaining asserted claim not found anticipated (claim 25), the District Court found the claim indefinite under 35 U.S.C. §112. On appeal, IPXL asserted that the claims were not anticipated since the anticipating patent, U.S. Patent No. 5,389,773, did not disclose the recited "single screen" and instead disclosed multiple sequential screens. The Federal Circuit held that, while multiple inputs were required, U.S. Patent No. 5,389,773 did not disclose that the inputs were on multiple screens and instead were provided through a single physical object on which information is displayed. The Federal Circuit also noted that U.S. Patent No. 5,389,773 contemplates a single screen which displays all information to complete a transaction, which therefore discloses the claimed invention. On the issue of definiteness, The Federal Circuit agreed with the District Court that claim 25 was indefinite since claim 25 mixed system and method limitations in a single claim. Specifically, claim 25 recites as follows:

The system of claim 2 [including an input means] wherein the predicted transaction information comprises both a transaction type and transaction parameters associated with that transaction type, and the user uses the input means to either change the predicted transaction information or accept the displayed transaction type and transaction parameters.

Novo's '352 patent is directed to a process for producing "ripe" human growth hormone (hGH) protein in E.Coli bacteria through the use of recombinant DNA techniques. The hGH protein has a specific sequence of 191 amino acids and is secreted by the anterior pituitary gland. Until the mid-1980's, hGH could be obtained only from the pituitary gland of a human cadaver, known as "pituitary-derived hGH." However, use of pituitary-derived hGH carried a high risk of contamination and infection for the patient. Prior to the '352 patent various attempts were made to produce synthetic hGH but were unsuccessful. In one example, an hGH having 192 amino acids resulted instead of the 191 amino acids found in "pituitary-derived hGH." The additional amino acid resulted in an hGH variant not functioning in the same way as the pituitary derived hGH.

The '352 patent discloses the production of ripe hGH protein having 191 amino acids and traces priority back through a series of continuation applications to a 1983 PCT application. The 1983 PCT application traces priority back to a 1982 Danish patent application filed on December 10, 1982. The '352 patent issued from U.S. Application Ser. No. 402,286 filed on March 10, 1995.

On July 7, 2000 the Board of Patent Appeals declared an interference involving Novo's '352 patent and Bio-Technology's '248 application. Novo filed a preliminary motion in the interference seeking the benefit, for purposes of priority, of the filing date of the 1983 PCT application. On March 12, 2002, the Board issued its final decision, awarding priority to Novo.

On April 1, 2002, Bio-Technology appealed the final decision of the Board to the U.S. District Court for the District of Delaware. The District Court reversed the Board's decision, ruling that the 1983 PCT application was not enabled. On April 30, 2002 Novo filed a complaint in the District of Delaware and on June 12, 2002 Bio-Technology filed its answer to the complaint and asserted a counterclaim for a declaratory judgment that the '352 patent is invalid and unenforceable. Following the trial, the District Court found (a) claim 1 was anticipated by a December 1981 article and (b) held that the '352 patent was unenforceable based on inequitable conduct during prosecution of the application.

On appeal, the Federal Circuit held claim 1 anticipated by the article since the article disclosed the limitations of claim 1 of the '352 patent. Specifically, the Federal Circuit found that the article disclosed the production of ripe hGH protein in an enabling manner because it discussed particular materials and a particular methodology to produce the ripe hGH protein.

Regarding the issue of inequitable conduct, the court held that the 1983 PCT application disclosed the use of a LAP enzyme to produce ripe hGH. The District Court also found that when the 1983 PCT application was filed, the inventors had not successfully prepared hGH with LAP. Novo made several attempts between the filing of the PCT and March 7, 1984 to synthesize hGH using LAP. Finally, on March 7, 1984, Novo successfully synthesized hGH using commercial LAP, unbeknownst to Novo at the time, that the LAP contained DAP I enzyme. On October 18, 1984 Novo scientists concluded that the active component in LAP was not LAP itself but a contaminating substance, in this case DAP I enzyme. The discovery that this contaminating substance was DAP I led to the filing of a 1986 PCT application. On October 3, 1986, Novo filed U.S. Patent Application No. 06/910,230 claiming priority to the 1986 PCT application. During prosecution of the '230 application, the claims were rejected and eventually the '230 application was abandoned. Over the next several years, Novo filed a number of U.S. applications describing the use of the DAP I enzyme to produce ripe hGH and claiming priority to the 1986 PCT application. Then, on November 12, 1992, Novo filed the '856 application and in a preliminary amendment, Novo amended the specification to indicate that the application was entitled to a priority date of December 10, 1982, based upon the 1983 PCT application claiming priority to the 1982 Danish application. Initially the Examiner did not accept the new priority claim and a rejection issued. Later on, the examiner held a personal interview with Novo attorneys and two of the inventors, discussing where in the priority documents enablement was present. Novo followed the interview addressing the issue of whether the 1983 PCT application was enabled and the examiner allowed the application. However, Novo failed to disclose to the PTO that an example of the 1983 PCT application, producing ripe hGH, had never been actually performed and the examiner relied upon such example to grant the priority of the 1983 PCT application. Because Novo failed to disclose to the PTO that the example of the 1983 PCT application, producing ripe hGH, had never been actually performed and the PTO relied upon such example to grant the priority of the 1983 PCT application, the Federal Circuit held that the '352 patent was unenforceable based on inequitable conduct during prosecution of the application. A copy of this case can be found at Novo Nordisk Pharmaceuticals v. Bio-Technology General, Civ. Case No. 04-1581 (Fed. Cir. October 5, 2005).

Term "Convex Top Surface" in Independent Claim Not Limited by Arguments Made During Prosecution With Respect to Dependent Claim
Nystrom v. TREX Company, Inc., 03-1092 (Fed. Cir., September 14, 2005). Nystrom obtained U.S. Patent No. 5,474,831 for a board having a convex top surface for use in constructing a flooring surface of a deck, and filed suit against TREX in the U.S. District Court for the Eastern District of Virginia, alleging TREX had infringed the '831 patent. TREX counterclaimed, seeking a declaratory judgment of non-infringement, invalidity, and unenforceability, and alleging antitrust violations by Nystrom, his company, and his attorneys. The District Court held a Markman hearing and issued a claim construction ruling construing the disputed claim term "convex top surface" to mean "an upper surface with an outward curve that has a ratio of its radius of curvature to width of the board between 4:1 to 6:1".

In its ruling, the District Court noted that "the specification does not contain any indication that the term convex top surface is to be assigned a specific range of curvature", but relied on statements Nystrom made in the prosecution history in arguing the patentability of a dependent claim, wherein Nystrom stated that "[i]t should be noted, however, that the ratio of the radius of curvature of a board to its width can vary within certain relatively narrow limits, e.g. from about 4:1 to about 6:1, and still meet the basic objectives of the invention, although the preferred ratio is about 5:1", and that "[a]nything much outside this range does not provide satisfactory performance and/or is not acceptable to the consumer". The District Court concluded that Nystrom's statement that "[a]nything much outside this range . . . is not acceptable" implied that his statement regarding a range of 4:1 to 6:1 for the radius of curvature ratio applied to the entire patent, and was not intended to apply solely to the dependent claim being argued.

On appeal, Nystrom argued that the District Court erred by ignoring the ordinary and customary meaning of the claim term "convex top surface", which is "an upper surface with an outward curve", and by finding instead that Nystrom limited this claim term to mean a convex top surface having a radius of curvature ratio in the range of 4:1 to 6:1 to distinguish the invention over a prior art reference. The court of appeals agreed with Nystrom, pointing out that the District Court had ignored the fact that at the time Nystrom made the statements the District Court had relied on, the dependent claim being argued contained the following language expressly providing for a radius of curvature ratio of about 5:1: "said top surface having a radius of curvature that is approximately five times as great as the width of the board, thereby defining a smoothly shaped and shallow convex top surface that sheds water . . . ."

The court of appeals said that Nystrom's statements were expressly directed to the dependent claim being argued, and there was no indication that Nystrom intended the claim "convex top surface" in all of the pending claims to be limited to a specific radius of curvature ratio. Accordingly, the court of appeals found that the prosecution history did not redefine or disclaim the term "convex top surface" in the claims, and held that the correct construction of this term is the ordinary and customary meaning of an upper surface that curves or bulges outward, as the exterior of a sphere.

Federal Circuit finds that inequitable conduct not imputed by mere filing of Terminal Disclaimer
In Pharmacia Corp. v. Par Pharm., 04-1478,-1496 (Fed Cir. August 10, 2005), Defendant filed an Abbreviated New Drug Application (ANDA) in order to sell a generic version of Plaintiff's patented glaucoma medication. Due to the ANDA, Plaintiff filed a patent infringement suit alleging infringement of U.S. Patent No. 5,296,504 (the ’504 patent) and U.S. Patent No. 5,422,368 (the ’368 patent). At trial, Defendant was able to show that Plaintiff had conducted inequitable conduct in regards to the '368 patent due to inaccuracies in a Declaration used to overcome a rejection during prosecution. The Defendant further asserted that, since a Terminal Disclaimer was filed in the '368 patent in response to an obviousness type double patenting rejection in view of the '504 patent, the two patents were linked such that the inequitable conduct in the '368 patent also exists in the '504 patent. The Federal Circuit held that, while the Declaration did support a finding of inequitable conduct for the '368 patent, the mere filing of a Terminal Disclaimer did not impute the inequitable conduct to the '504 patent. Specifically, the Federal Circuit noted that the Terminal Disclaimer merely reflects a judicial policy to limit the term of related patents, but that "[b]eyond their shared expiration date, …two disclaimed patents maintain significant attributes of individuality." As such, without more, the filing of a Terminal Disclaimer will not impute inequitable conduct between disclaimer patents and allows the patents to be separately enforceable.

Submission of Video Falsely Represented as Being Made with Claimed Invention Is Material Misrepresentation with Intent to Deceive Rendering Patent Unenforceable for Inequitable Conduct
Frazier v. Roessel Cine Photo Tech, Inc., 04-1060, 04-1092 (Fed. Cir., August 2, 2005). During prosecution of a patent application for a camera lens, Frazier argued that the increased depth of field achievable with the claimed lens distinguished the claimed lens from the prior art, and submitted a video purportedly shot with the claimed lens showing this increased depth of field, when in fact certain scenes in the video were not shot with the claimed lens. The examiner subsequently allowed the application without further rejection. Frazier sued Roessel for infringement, and the District Court found that the submission of the video was a material representation made with intent to deceive, and accordingly held that the patent was unenforceable for inequitable conduct.

On appeal, Frazier argued there was insufficient proof to show the examiner was misled by the video because the claimed lens was capable of producing the shots in the video, as evidenced by Frazier's recreation of the shots in the video using the claimed lens and his expert's testimony about the capabilities of the claimed lens. The appeals court was not convinced, holding that the mere submission of the video constituted a sufficiently material misrepresentation without regard to whether the claimed lens could produce the same shots. Rohm & Haas Co. v. Crystal Chem. Co., 722 F.2d 1556, 1571 (Fed. Cir. 1983) ("In contrast to cases where allegations of fraud are based on the withholding of prior art, there is no room to argue that submission of false affidavits is not material.").

Frazier also argued that he could not have intended to deceive unless he believed the claimed lens was incapable of achieving the depth of field of the lens used to shoot the video. The appeals court was not convinced, stating that Frazier's argument, if correct, would require proof that he subjectively believed the submission of the video was deceptive, and holding that direct evidence of intent is unavailable in most cases and unnecessary in any event. Bruno Indep. Living Aids, Inc. v. Acorn Mobility Servs., Ltd., 394 F.3d 1348, 1354 (Fed. Cir. 2005) ("'Intent need not, and rarely can, be proven by direct evidence.' Rather, in the absence of a credible explanation, intent to deceive is generally inferred from the facts and circumstances surrounding a knowing failure to disclose material information." (quoting Merck & Co. v. Danbury Pharmacal. Inc., 873 F.2d 1418, 1422 (Fed. Cir. 1989))); Ulead Sys., Inc. v. Lex Computer & Mgmt Corp., 351 F.3d 1139, 1146 (Fed. Cir. 2003) ("Direct evidence of deceptive intent is not required; rather it is usually inferred from the patentee's overall conduct.").

Federal Circuit finds patent invalid for being on sale
In Electromotive Div. of GMC v. Transp. Sys. Div. of GE, 417 F.3d 1203 (Fed Cir. 2005), the Federal Circuit affirmed that a patent directed to a planetary bearing and compressor were invalid under 35 U.S.C. §102(b) based upon a pre-critical date commercial sale. Plaintiff produces locomotives which incorporate the planetary bearing and compressor within a planetary drive train. When the planetary bearing and compressor were first developed, Plaintiff initiated a two phase testing program. In the first phase, the planetary bearing and compressor were tested in house. When the first phase was completed on July 17, 1989, a second phase of testing was begun in August of 1989. In the second phase, the planetary bearing and compressor were field tested by being installed in sold locomotives. Plaintiff did not actively monitor the field tested planetary bearing and compressor after the sale, did not require recipients to sign confidentiality agreements or otherwise restrict access to the planetary bearing and compressor, and instead merely monitored whether repairs occurring in the locomotives were related to the planetary bearing and compressor. The Federal Circuit held that, while the second phase was designated a test phase, the second phase did not qualify as experimental within the meaning of 35 U.S.C. §102(b). Specifically, the Federal Circuit held that whether activity is experimental (as opposed to an on-sale activity) is based upon objective criteria separate from the inventor's subjective intent. The objective criteria are judged based upon thirteen (13) factors:

(1) the necessity for public testing; (2) the amount of control over the experiment retained by the inventor; (3) the nature of the invention; (4) the length of the test period; (5) whether payment was made; (6) whether there was a secrecy obligation; (7) whether records of the experiment were kept; (8) who conducted the experiment; (9) the degree of commercial exploitation during testing; (10) whether the invention reasonably requires evaluation under actual conditions of use; (11) whether testing was systematically performed; (12) whether the inventor continually monitored the invention during testing; and (13) the nature of the contacts made with potential customers.

Specifically, the Federal Circuit affirmed that the claims are interpreted in accordance with Vitronics v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir. 1996), which emphasizes the importance of intrinsic evidence (i.e., specification and prosecution history) as the primary or initial claim construction tool. The Federal Circuit rejected the use of dictionaries and treatises as a primary method of construing claim features as held in Texas Digital, Inc. v. Telegenix, Inc., 308 F.3d 1193 (Fed. Cir. 2002). In making this decision, the Federal Circuit clarified that the “ordinary meaning” of a claim term is the meaning to a person skilled in the art at the time of the invention (i.e., as of the effective filing date of the patent application) after reading the claim term not only in the context of the particular claim in which the disputed term appears, but also in the context of the entire patent, including the specification and prosecution history. While extrinsic evidence, which “consists of all evidence external to the patent and prosecution history, including expert and inventor testimony, dictionaries, treaties and technical references” is “less significant than the intrinsic record,” this extrinsic evidence can still be useful to help educate the District Court regarding the field of invention and how a person skilled in the art would understand the “ordinary meaning” of a claim term when read in the context of the specification and prosecution history.

In discounting the use of extrinsic evidence as a primary tool for claim construction, the Federal Circuit held that “extrinsic evidence in general as less reliable than the patent and its prosecution history” for several reasons:

• extrinsic evidence by definition is not part of the patent and does not have the specification’s virtue of being created at the time of patent prosecution for the purpose of explaining the patent’s scope and meaning
• extrinsic publication may not be written by or for skilled artisans and therefore may not reflect the understanding of a skilled artisan in the art.
• extrinsic evidence such as expert reports and testimony is generated at the time of and for the purposes of litigation and thus can suffer from bias that is not present in intrinsic evidence.
• there is a virtually unbounded universe of potential extrinsic evidence (e.g., different dictionaries may contain different sets of definitions for the same words) such that each party will naturally choose the pieces of extrinsic evidence most favorable to its cause, leaving the court with the considerable task of filtering the useful extrinsic evidence from the fluff; and
• undue reliance on extrinsic evidence can undermine the public notice function of patents.

Specifically, the Federal Circuit looked to dependent claims 2 and 17, which further define that the “baffles” are disposed at “angles for deflecting projectiles such as bullets” that penetrate the outer shell, and dependent claim 6, which further provides an additional requirement for the baffles as being interlocked “to form an intermediate barrier”. Thus, under the doctrine of claim differentiation, claim 1 would have a scope of at least commensurate with these depending claims such that the term "baffles" in claim 1 is not limited to elements which deflect bullets.

The Federal Circuit also noted that the specification further discusses several other purposes served by the baffles beyond deflection of bullets. For example, the baffles are described as providing structural support for one of the wall, as shown in FIG. 4 and FIG. 6. In addition, the baffles are also described as providing “for overlapping and interlocking … to produce substantially an intermediate barrier wall between the opposite [wall] faces, and thus, creating small compartments that can be filled with either sound and thermal insulation or rock and gravel to stop projectile, as shown in FIG. 7. Thus, there was no statement in the specification limiting the term "baffles" to elements which deflect bullets alone.

In view of the multiple objectives to be served by the “baffles” as described in the specification and in view of the doctrine of claim differentiation, the term “baffles” need not be read restrictively to require that “baffles” must be used to deflect bullets and, thus, must have angles at other than 90 degrees angle.

As a result, the Federal Circuit rejected the accused infringer’s arguments (AWH) in favor of a restrictive definition of the term “baffles”, reversed the summary judgment of non-infringement, and remanded the infringement claims back to the District Court for further proceedings.

Federal Circuit defines scope of notice to show willful infringement after Knorr-Bremse
In Imonex Servs. v. W.H. Munzprufer Dietmar Trenner Gmbh, 408 F.3d 1374, 74 U.S.P.Q. 2d 1936 (Fed. Cir. 2005), petition for reh'g denied 2005 U.S. App. LEXIS 15283 (Fed. Cir., June 27, 2005), Imonex alleged that Munzprufer infringed Imonex's U.S. Patent Nos. 4,911,280 and 5,988,349. Imonex patented coin selectors, which differentiate between different size coins. The jury found the patents valid, enforceable and willfully infringed. Willful infringement was based on a showing that the totality of the circumstances evince conduct that constitutes willful infringement using the standard set forth in Knorr-Bremse System e Fuer Nutzfahrzeuge GmbH v. DanaCorp., 383 F.3d 1337, 1342 (Fed. Cir. 2004). Under this standard, actual notice of another's patent rights triggers an affirmative duty of care, whereas constructive notice is not sufficient to trigger an affirmative duty. Imonex demonstrated the patented devices at trade shows to employees of the defendant, widely distributed literature of the patented products indicating the products were patented, and corresponded with the defendant's employees about the use of the patented devices in the defendant's products. These actions gave the defendant actual notice and thus triggered an affirmative duty of care. Thus, the Federal Circuit held that, based on the totality of the circumstances, the jury had ample evidence to find willful infringement.

Federal Circuit gives narrow meaning to claim term "conventional" to be limited to then-existing technology and to exclude later developed technology
In PC Connector Solutions Inc. v. Smartdisk Corp. 406 F.3d 1359; 74 U.S.P.Q.2D 1698 (Fed. Cir. 2005), PC Connector asserted that Smartdisk Corp. infringed patent claim which recite, among other features, "an input/output port normally connectible to a conventional computer input/output port" and "traditionally connectible to a computer by means of an input/output port of the computer and the standard input/output port of the particular separate computer peripheral." In its non-infringement defense, Smartdisk Corp. asserted that the recited terms "conventional," "normal," "traditionally," and "standard" limited the scope of the claims to the then-existing technologies since later arising technologies were not conventional, normal, traditional, or standard at the time of filing the application. The Federal Circuit reviewed the specification and determined that the only disclosed embodiment which corresponded to these terms related to a computer input/output port in existence in 1988. While the Federal Circuit declined to limit the literal scope to the disclosed embodiments since the specification did not disclaim other types of ports, the Federal Circuit held that the meaning must be consistent over time. As such, these terms must be limited to the understanding as of the effective filing date of the application. Since the flash memory and smart cards of Smartdisk Corp. were not conventional at the time the application was filed, Smartdisk Corp.'s products were not covered by the literal scope of the claims. As such, an applicant needs to be aware that, when incorporating standards or requirements for "conventional" technology into claims, the claims may not be given a meaning which covers later-developed technology not defined by that standard or not understood to be "conventional."

Failure to Describe Mechanism Performing Function Invalidates Means plus Function Claim
In Default Proof Credit Card System v. Home Depot, Civ. Case No. 05-1069, 2005 U.S. App. LEXIS 11414, (Fed. Cir. June 16, 2005). Default Proof owns U.S. Patent No. 6,405,182, which directed to a Point of Sale (POS) terminal that allow individuals to obtain prepaid debit cards. Claim 1 of U.S. Patent No. 6,405,182 recites a “means for dispensing at least one debit card for each transaction.” Default Proof sued Home Depot and other stores for infringement of claim 1. As a defense to infringement, Home Depot asserted that this feature of claim 1 was written in means plus function language, and thus invokes 35 U.S.C. §112, 6. However, this feature lacks a description of any structure which provides a function of a "means for dispensing" debit cards as recited in claim 1 and is thus invalid for being indefinite under 35 U.S.C. §112, 2. On appeal to the Federal Circuit, the Federal Circuit upheld the finding of invalidity since, although there was a link between the recited function and the POS terminal, there was no disclosure of any structure used by the POS terminal which actually dispensed the debit card. Further, the fact that certain types of POS terminals were known to have such a feature, there was no suggestion in the specification that any of these types of POS terminals could be used and claim 1 recites the means for dispensing as being separate from the POS terminal itself. As stated by the Federal Circuit, "while it is true that the patentee need not disclose details of structures well known in the art, see Atmel, 259 F.3d at 1371, the specification must nonetheless disclose some structure.”

Federal Circuit defines scope of notice to show willful infringement after Knorr-Bremse
In Imonex Servs. v. W.H. Munzprufer Dietmar Trenner Gmbh, 408 F.3d 1374, 74 U.S.P.Q. 2d 1936 (Fed. Cir. 2005), petition for reh'g denied 2005 U.S. App. LEXIS 15283 (Fed. Cir., June 27, 2005), Imonex alleged that Munzprufer infringed Imonex's U.S. Patent Nos. 4,911,280 and 5,988,349. Imonex patented coin selectors, which differentiate between different size coins. The jury found the patents valid, enforceable and willfully infringed. Willful infringement was based on a showing that the totality of the circumstances evince conduct that constitutes willful infringement using the standard set forth in Knorr-Bremse System e Fuer Nutzfahrzeuge GmbH v. DanaCorp., 383 F.3d 1337, 1342 (Fed. Cir. 2004). Under this standard, actual notice of another's patent rights triggers an affirmative duty of care, whereas constructive notice is not sufficient to trigger an affirmative duty. Imonex demonstrated the patented devices at trade shows to employees of the defendant, widely distributed literature of the patented products indicating the products were patented, and corresponded with the defendant's employees about the use of the patented devices in the defendant's products. These actions gave the defendant actual notice and thus triggered an affirmative duty of care. Thus, the Federal Circuit held that, based on the totality of the circumstances, the jury had ample evidence to find willful infringement.

Federal Circuit gives narrow meaning to claim term "conventional" to be limited to then-existing technology and to exclude later developed technology
In PC Connector Solutions Inc. v. Smartdisk Corp. 406 F.3d 1359; 74 U.S.P.Q.2D 1698 (Fed. Cir. 2005), PC Connector asserted that Smartdisk Corp. infringed patent claim which recite, among other features, "an input/output port normally connectible to a conventional computer input/output port" and "traditionally connectible to a computer by means of an input/output port of the computer and the standard input/output port of the particular separate computer peripheral." In its non-infringement defense, Smartdisk Corp. asserted that the recited terms "conventional," "normal," "traditionally," and "standard" limited the scope of the claims to the then-existing technologies since later arising technologies were not conventional, normal, traditional, or standard at the time of filing the application. The Federal Circuit reviewed the specification and determined that the only disclosed embodiment which corresponded to these terms related to a computer input/output port in existence in 1988. While the Federal Circuit declined to limit the literal scope to the disclosed embodiments since the specification did not disclaim other types of ports, the Federal Circuit held that the meaning must be consistent over time. As such, these terms must be limited to the understanding as of the effective filing date of the application. Since the flash memory and smart cards of Smartdisk Corp. were not conventional at the time the application was filed, Smartdisk Corp.'s products were not covered by the literal scope of the claims. As such, an applicant needs to be aware that, when incorporating standards or requirements for "conventional" technology into claims, the claims may not be given a meaning which covers later-developed technology not defined by that standard or not understood to be "conventional."

Summary of the Invention and Background of the Invention used to Limit Scope of Claims
In Boss Control Inc. v. Bombardier Inc., 410 F.3d 1372, 75 U.S.P.Q.2D 1038 (Fed Cir. June 8, 2005), Boss Control owns U.S. Patent No. 5,734,206. U.S. Patent No. 5,734,206 is drawn to a power interrupt apparatus that prevents the unauthorized use of an electrically operated device. Boss Control sued Bombardier and others for infringement of claim 7, which includes a feature in which "said controller is operative to interrupt power to the load responsive to said code-providing device being operatively disconnected from said controller." In order to show infringement, Boss Control wanted a broad interpretation of the term "interrupt" to read on any break off of power or cut off power, which Boss Control asserted was the ordinary meaning of this phrase. The District Court held that Boss Control was not entitled to this broader interpretation and instead sided with Bombardier in that a narrower (and non-infringing) interpretation was appropriate in view of the use in the patent specification. On appeal from the judgment of non-infringement, the Federal Circuit held that the term “interrupt” was defined in the specification and is narrower than the broadest possible meaning based upon Summary of the Invention and Background of the Invention sections. Specifically, the Background of the Invention discussed conventional devices having on/off interrupts, thus indicating that the term "interrupt" was intended to have a narrower meaning that is more than simply a cut off or break off of power. The Federal Circuit relied upon the following passage to support this interpretation.

In the prior art, means have been provided to prevent unauthorized usage of electrical appliances and similar electrically operated devices, primarily through key operated electro-mechanical circuit interrupt devices. However, such devices conventionally provide for on-off control only, meaning that the device completely interrupts the flow of electrical power to the appliance while in the interrupt or “locked” state, and it connects the appliance to the electrical supply in the operative or “unlocked” state.

Consistent with the Background of the Invention, the Summary of the Invention distinguished the application's invention over conventional interrupts as being more than a simple on/off function. The Federal Circuit relied upon the following passage to support this interpretation.

In accordance with one aspect of the invention the appliance or device retains a connection to the power supply while in interrupt or “locked” mode; complete power shutoff only occurs when a preset electrical current is exceeded, thus allowing operation of the appliance’s auxiliary electrical equipment while the interrupt device is in the interrupt mode.

Since the Detailed Description was also consistent with this description in the Summary of the Invention, the Federal Circuit agreed with the District Court and limited the meaning of broad term “interrupt” to only literally cover more than simple on/off functions.

Failure to Seek Certificate Of Correction Prevents District Court from Making Corrections Not Evident On Face Of Patent
In Group One Ltd. v. Hallmark Cards, Inc., 04-1296 (Fed. Cir. May 16, 2005), the Federal Circuit reviewed the patentability of U.S. Patent No. 5,518,492 (the '492 patent) and U.S. Patent No. 5,711,752 (the '752 patent) which were found invalid at the District Court level for both procedural reasons and for obviousness. With regard to the '492 patent, the Federal Circuit reviewed the authority of the District Court to make corrections for printing errors caused by the United States Patent and Trademark Office (USPTO) but which were not corrected prior to bringing an action. Specifically, in claim 1 of the '492 patent, a phrase was added to the claim for purposes of patentability and was not printed on the issued patent. It was uncontested that the error was correctable under 35 U.S.C. §254 as an error caused by the USPTO. However, the patent owner had not filed for or obtained a certificate of correction at the time of trial. The Federal Circuit held that, in certain cases where the error is "evident from the face of the patent," the District Court has the authority to effect the change retroactively as was done in Hoffer v. Microsoft, et al., Civ. Case. No. 04-1103 (Fed. Cir. April 22, 2005). However, unlike the situation in Hoffer, the error in claim 1 was not evident from the face of the patent such that the District Court correctly did not make the correction at trial. As such, the claims as presented at trial were invalid.

In regards to the '752 patent, the Federal Circuit upheld the patentability of the claims since the conflicting evidence of obviousness supported the jury's non-obviousness verdict. Moreover, the Federal Circuit held the '752 patent enforceable over various technical and procedural defects. Specifically, the Federal Circuit held that, while the patent owner had failed to pay a maintenance fee, the patent owner's petition to pay maintenance fees, which was not granted until after the close of evidence at trial, did not render the patent invalid since the late payment was retroactive under 35 U.S.C. §41(c)(1) and did not effect the enforceability of the claims. Lastly, the Federal Circuit held that the terminal disclaimer signed by the inventors and filed in the '752 patent was effective since, while the patent was assigned by the inventors at the time the terminal disclaimer was filed, the assignment was not recorded at the USPTO and 37 CFR 1.321 only requires a signature where there is an assignee of record.

Federal Circuit Enforces Rarely Utilized False Marking Statute under 35 U.S.C. §292
Under 35 U.S.C. §292, a competitor can bring an action against a person who falsely marks an item as being covered by one or more claims of a patent. If false marking is found, the person is liable to the competitor in the amount of $500 per offense (i.e., per marked item). In order to enforce this fine, however, the competitor needs to provide, by a preponderance of the evidence, that the person marked the item with "the word “patent” or any word or number importing that the same is patented for the purpose of deceiving the public." (italics added). While rarely enforced, in Clontech Lab. Inc. v. Invitrogen Corp., 406 F.3d 1347; 74 U.S.P.Q.2D (BNA) 1598 (Fed Cir. May 05, 2005), the Federal Circuit had an opportunity to clarify the burdens of proof in showing whether a falsely marked item is in violation of 35 U.S.C. §292. In this case, Invitrogen is an owner of four patents directed to RNase H deficient Reverse Transcriptase ("RT") polypeptides: U.S. Patent No. 5,244,797, U.S. Patent No. 5,405,776, U.S. Patent No. 5,668,005, and U.S. Patent No. 6,063,608. Invitrogen further markets RNase H deficient RTs known as SUPERSCRIPT ("SS") and SUPERSCRIPT II ("SSII"), along with kits and cDNA libraries related to SS and SSII. The SS and SSII have been marked with all four patents, whereas the kits and cDNA libraries were marked with some of the four patents. A competitor, Clontech, sued Invitrogen on, among other grounds, under 35 U.S.C. §292 for false marking. Clontech argued that the patents did not cover the sold SS, SSII, kits and cDNA libraries as indicated in the markings, and that Invitrogen was sufficiently aware that these were falsely marked so as to constitute a violation of 35 U.S.C. § 292 at least in view of a test conducted in at least 2000. The District Court found Invitrogen had falsely marked the sold SS, SSII, kits and cDNA libraries and was thus in violation of 35 U.S.C. § 292.

On appeal, the Federal Circuit stated that the purpose of 35 U.S.C. § 292 is to provide a mechanism of reliably determining if an article is covered by intellectual property. This purpose is frustrated where unpatented articles are mismarked with an intent to deceive. However, since 35 U.S.C. § 292 is not a strict liability statute, there needs to be evidence that the mismarking was made with an intent to deceive as well as evidence that the marks were indeed false as not being covered by the listed patents. The Federal Circuit held that the competitor needed to provide objective evidence that shows, by a preponderance of the evidence, this intent to deceive public. If shown, the accused person can rebut by showing mismarking was not with intent to deceive. From this test, the Federal Circuit held overturned the District Courts judgment of false marking for the SS and SSII since the conflicting evidence as to the meaning of the 2000 test results did not put Invitrogen on “clear” notice of mismarking and since Court did not interpret the recited phrase “substantially no RNase H activity” to show actual mismarking.

However, in regards to the cDNA libraries, the Federal Circuit upheld the District Court's judgment of false marking since there was no disagreement about actual mismarking or that the patent owner was not aware that claims covered the cDNA libraries. The Federal Circuit dismissed Invitrogen's arguments that the public policy of 35 U.S.C. § 292 is further even where there is no good faith belief that the patents cover the marked product as being contrary to the explicit purpose of the statute, which requires the patent owner to provide accurate information about the protected nature of the marked product. Since there was no objective evidence of good faith belief in that the marking the libraries was not to deceive public and no evidence that marked patents did not cover cDNA libraries, the Federal Circuit upheld the District Court's judgment for the cDNA libraries as being falsely marked as defined under 35 U.S.C. § 292.

Claim Interpretation And Use of "Whereby" Clause to Limit Scope of Recited Function, And Allows Minor Corrections of Issued Patents During Litigation
Steven Hoffer is an independent inventor and owns U.S. patent no. 5,799,151, which is directed to an interactive trade network by which users interactively post information in regard to discrete and indexed economic topics. The indexed topics are posted on a host computer, and the users are able to interact with each other directly. Mr. Hoffer asserted that Microsoft Corp. and others infringed claim 21of U.S. patent no. 5,799,151 due to their use of the Universal Description Discovery and Integration (UDDI) system. The UDDI system does not use interactive messaging and instead requires posting of the individual messages. However, since claim 21 does not specifically recite the use of interactive messaging except in a whereby clause, Mr. Hoffer believed that the whereby clause did not limit the claim to interactive messaging. In the first part of its ruling, the District Court held that the recitation of interactive messaging in the whereby clause limited the scope of claim 21 to require interactive messaging, and relied upon statements in the specification to support its position. Citing the Summary of the Invention, the District Court found that removing the interactive messaging requirement recited in the whereby clause would be contrary to the fundamental invention. On appeal, the Federal Circuit agreed with the District Court's use of the whereby clause. Specifically, while the general rule is that "whereby" clauses do not limit the scope of the claim where the clause merely recites an intended result, if the clause expresses a necessary function performed by the recited invention, the necessary function required in the whereby clause will become a claim limitation.

As such, the UDDI system did not infringe claim 21 literally or under the doctrine of equivalents since the UDDI system lacks the recited interactive messaging.

In the second part of its ruling, the District Court had held claim 22 invalid for improper dependency and stated that the District Court lacked the power to allow correction of the claim after filing of the lawsuit even though the error was incurred by the United States Patent and Trademark Office and was corrected using a Certificate of Correction after filing of the lawsuit. On appeal, the Federal Circuit reversed the District Court and held that the District Court has the power to correct typographical errors and that such errors do not automatically render claim 22 invalid for indefiniteness if the error is plain from the prosecution history. According to the Federal Circuit, absent evidence of prejudice to the defendants or evidence that the patent owner delayed obtaining the Certificate of Correction to deceive the defendants, the District Court has the power to correct the patent since "a patent should not be invalidated based upon an obvious administrative error." Hoffer v. Microsoft, et al., Civ. Case. No. 04-1103 (Fed. Cir. April 22, 2005).

Claim Interpretation Of Phrase "Attenuated and Filtered" Has Broader Common Meaning In Light of Dictionary Definition, Specification, And Since the Narrower Meaning Excludes All Embodiments of the Invention
In Nellcor Puritan Bennett, Inc. v. Masimo Corp. 04-1427 (Fed Cir. April 8 2005), the Federal Circuit revisited the issue of claim construction and the process used to construe the claim. In particular, this case deals with construing the meaning of "attenuated and filtered." The District Court construed the phrase "attenuated and filtered" to mean "reduced and removed," and then granted summary judgment of non-infringement in favor of defendant Masimo based on this narrowed construction. The Federal Circuit vacated the District Court's summary judgment of non-infringement, and remanded for further consideration based on a new construction of the claim terms. In order to construe the claim, the Federal Circuit first looked at the ordinary meaning of the claim language and relied on a standard dictionary (IEEE, Authoritive Dictionary of IEEE Standard Terms) for such definitions. Since two of the definitions provided by the dictionary were consistent with the definition proposed by the plaintiff, Nellcor, the Court looked then at the specification. The specification provided further guidance as to the meaning of the term "attenuated and filtered from the composite," since at one part of the specification the term "attenuated and filtered" was used to refer to the "effective removal" of data rather than the absolute removal of data. Furthermore, the Federal Circuit rejected the District Court's interpretation that "attenuated and filtered" meant "reduced and removed" since such interpretation would exclude all of the embodiments of the invention. According to Vitronics Corp. v. Conceptronic, Inc. 90 F.3d 1576, 1583 (Fed. Cir. 1996), a construction that excludes all of the embodiments of the invention is rarely if ever correct. As such, the Federal Circuit found that a broader interpretation was both consistent with the ordinary meaning of the phrase and with the examples provided in the specification.

Claim Interpretation And Use of Specification, Prosecution History, And Common Meaning To Interpret "Mounted On"
In the context of a claimed processing system in which a first communication means and a first microcomputer are mounted on a transportable container and are in communication with a second communication means and a second microcomputer mounted on a workstation, the patent owner attempted to interpret the phrase "mounted on" to include electrical connections such that the claims are not limited to only physical attachments between the second microcomputer and the workstation. The Federal Circuit held that, where an ordinary meaning is present and is consistent with the specification and statements made to the Examiner during prosecution history of the issued patent and its parent application to distinguish over prior art references, broader meanings are not adopted. Further, a conclusory statement by an expert is insufficient to broaden the term "mounted on" to include electrical connections. Thus, the term "mounted on" does not read on mere electrical connections to a microcomputer. Lastly, since the term "mounted on" is binary in nature, the term "mounted on" cannot be used by the doctrine of equivalents to read on an item which is not "mounted on" since doing so would violate the all elements rule of claim construction by vitiating a claim term. Asyst Techn. Inc. v. Emtrak, Inc., Civ. Case No. 04-1048, -1064 (Fed. Cir. March 22, 2005).

Claim Interpretation And Use of Specification, Prosecution History, And Common Meaning To Interpret "Substantially Uniform"
Medrad owns a patent drawn to radio frequency coils used in the manufacture of magnetic resonance imaging (MRI) devices. As recited in claim 1, the patented coils provide a "substantially uniform" magnetic field that is "applied to a "region of interest." Medrad accused MRI Devices of infringement and MRI Devices asserted, as a defense, that the patent was invalid as reading on the prior art. The District Court granted a summary judgment of invalidity. In affirming the invalidity of the patent, the Federal Circuit noted that Medrad's definitionsof the terms "substantially uniform" and "region of interest" to avoid invalidity are not supported by the specification, which includes in its objects of the invention and specific examples, support for the interpretation of the claim terms afforded by the District Court. Further, Medrad's definition of the term "substantially uniform" in the context of a magnetic field does not conform to the examples of coils used to generate the magnetic field disclosed in the patent. Thus, in the context of a claim term which provides little guidance as to the appropriate meaning, the written description is to be consulted and any resulting claim construction should be consistent with the written description since a "'claim construction that does not encompass a disclosed embodiment is … rarely, if ever, correct. Johns Hopkins Univ. v. Cellpro, 152 F. 3d 1342, 1355 (Fed. Cir. 1998)." (Opinion at Pg. 11). Lastly, the mere fact that the term "substantially uniform" has been differently interpreted by the Federal Circuit in an unrelated case is not dispositive since the unrelated case, Ecolab, Inc. v. Envirochem, Inc., 264 F.3d 1358 (Fed. Cir. 2001), did not relate to magnetic fields used in MRI imaging as does the claimed invention. Medrad Inc. v. MRI Devices Corp., Civ. Case No. 04-1134 (Fed Cir. March 16, 2005).

Claim Interpretation and Use of Objects of Invention and Cited Prior Art as Intrinsic Evidence
V-Formation claimed that Benetton's in-line skates infringed 3 of V-Formation's patents (U.S. Patent Nos. 5,873,584; 5,803,466; and 6,045,143). One patent was still at issue on appeal, the 5,803,466 patent. In particular, the interpretation of the claim term "releasably attaching" found in claims 1 and 9 was at issue. The District Court focused on the "intrinsic record" of the 5,803,466 patent. The District Court construed the claim term by looking at the specification and a listed object of the invention. Additionally, and most interestingly, the District Court construed the prior art cited by V-Formation as "intrinsic evidence" and therefore relied upon the disclosure in U.S. Patent No. 5,549,310 issued to Meibock to interpret the claims of the 5,803,466 patent. Thus, applicants should be aware when using terms that references cited in an Information Disclosure Statement are construed as part of the intrinsic record of the patent and any claim terms that are used contrarily to the use of the cited reference should be defined explicitly in the specification. V-Formation, Inc. v. Benetton Group SPA, Rollerblade, Inc., 03-1408 (Fed. Cir. March 15, 2005).

Commercial Offer for Sale Does Not Occur Until Claimed Invention Actually Conceived Even Where Commercial Offer Might Include Variation Including Claimed Invention Within Scope of Contract
Sparton alleged that the United States infringed Sparton's U.S. Patent Nos. 3,921,120 and 4,029,233 relating to sonobuoys and sought relief under 28 U.S.C. 1498(a) in the Federal Court of Claims. As a defense, the United States noted that the patented invention had been subject to a commercial offer for sale such that the patents were invalid under 35 U.S.C. §102(b). The Court of Claims agreed with the United States and ruled that the patents were invalid because the inventions were subject to a commercial offer for sale more than one year prior to the effective filing date of these patents since the offer, as interpreted under commercial contracting rules and the UCC, encompassed the claimed invention. The Federal Circuit reversed the Court of Claims and noted that, in order for a patent to be held invalid based on the 35 U.S.C. §102(b) on-sale bar, the claimed invention itself must have been subject to a commercial offer for sale and the invention as claimed must be ready for patenting. For the asserted "commercial offer" prong of the test, the relevant sale occurred on March 17, 1971 as part of an engineering change proposal (ECP) submitted by Sparton for sonobuoy work being performed under a United States Navy contract. However, the patents at issue each recite a single release plate mechanism, whereas while the contract having the ECP was for a multiple release plate mechanism. Thus, any offer was not for the patented invention since there was no evidence that the single release plate was actually offered or conceived. Thus, even assuming that the ECP would have allowed the contractor to submit the single release plate as a variation on the design to fulfill the contractual requirements, since the design itself was for the multiple release plate mechanism and there is no evidence that the claimed release plate mechanism was conceived prior to submission of the ECP, the Federal Circuit held that no offer for sale was made for the patented invention. Sparton Corporation v. United States, Civ. Case. No. 03-5169 (Fed. Cir. February 28, 2005).

Failure of License to Convey All Substantial Rights Prevents Licensee From Asserting Patent Rights Against Third Party Without Patent Owner
In Fieldturf, Inc. v. Southwest Recreational Industries, Inc., 57 F.3d 1266 (Fed. Cir. 2004), Fieldturf obtains a license to practice the claimed "artificial turf" as an alternative to natural grass for playing surfaces for athletic games, as disclosed in U.S. Patent No. 4,337,283. Evidently, the inventor of the ‘283 patent, Frederick Haas Jr., had assigned the patent to a Louisiana partnership that, through a succession of entities, conveyed the exclusive license rights to Fieldturf. Fieldturf asserted the ‘283 patent against Southwest, the maker of AstroPlayTM (a rubber and sand-filled system), on the basis that Southwest’s manufacture of AstroPlayTM was alleged to infringe the patent. However, on appeal from a Kentucky District Court, the Federal Circuit dismissed the patent claim because Fieldturf did not have standing to enforce the patent because the licensing agreement was nothing more than a bare license that did not grant the right to enforce the patent, either explicitly or impliedly. Fieldturf was neither the patentee, a successor in title to the patentee or an exclusive licensee of the patent at issue. To have an exclusive license, Fieldturf must show that it possesses "all substantial rights in the patent, which Fieldturf was not able to do so. As a result, Fieldturf does not have standing and cannot bring suit against Southwest.

Rebuttable Presumption of Market Power and Per Se Illegality in Antitrust Actions in Which Patented Tying Product is Tied to Unpatented Tied Product
Trident owns U.S. patent no. 5,343,226, which claims a patent on an ink jet device and supply system used in the manufacture of printers. Trident also manufactures ink for use in the patented ink jet device. In licensing agreements with OEM manufacturers to use the patented ink jet device, Trident required the OEM manufacturers to purchase from Trident the ink used to refill the licensed ink jet devices. A competitor, Independent Ink, sued Trident claiming that the license agreements constitutes a per se illegal tying arrangement in violation of the Sherman Act, 15 U.S.C. §1 et seq. Specifically, Independent Ink asserted that license illegally tied the licensing of the patented ink jet with the purchase of unpatented ink. While the District Court held that such tying arrangements require a showing of market power in the market for the patented ink jet device, the Federal Circuit overturned the District Court's decision. Specifically, the Federal Circuit noted that, as required by the Supreme Court in Jefferson Parish Hospital District No. 2 v. Hyde, 466 US 2, 16 (1984) and International Salt Co. v. United States, 332 US 392 (1947), where the tying product is patented, there is a presumption of market power in the tying market. The Federal Circuit specifically noted that, in comparison with recent trends to require a showing of market power for non-patented tying goods, the treatment of patented tying products and the presumption of market power has been "more consistent" than for unpatented products. (Opinion at Pg. 8). As such, while there is considerable criticism of the presumption of market power for patented products and while the prosecutorial guidance set forth in the Department of Justice's Antitrust Guidelines for the Licensing of Intellectual Property (1995) indicates that no presumption of market power exists based only upon a patent, this criticism and exercise of prosecutorial guidance "does not affect the validity of the Supreme Court's decisions in International Salt and [United States v. Loew's Inc., 371 US 38 (1962)]" such that both International Salt and Loew's remain good law. (Opinion at Pgs. 13 and 14, n. 10). Therefore, the Federal Circuit held that Independent Ink did not need to prove market power in the market of the patented tying product. However, the Federal Circuit held that, while there is a presumption of market power in the patented tying product, the patent owner Trident is entitled to present evidence to rebut the presumption. Independent Ink, Inc. v. Illinois Tool Works, Inc., et al., Civ Case No. 04-1196 (Fed. Cir. January 25, 2005).

Declaratory Action Requires Affirmative Act Beyond Mere Notice of the Patent and Institution of Litigation Against Others In Field
Teva is a generic drug manufacturer and filed an Abbreviated New Drug Application ("ANDA") pursuant to the provisions of the Hatch-Waxman Amendments to the Federal Food, Drug and Cosmetic Act in order to manufacture a generic version of the drug sertraline hydrochloride, which is sold by Pfizer under the name Zoloft®. Since Pfizer holds patents for sertraline hydrochloride, Pfizer listed these patents in the Orange Book in compliance with the Hatch-Waxman Act, 21 U.S.C. §355. In filing the ANDA, Teva acknowledged the existence of the patents, but asserted in the ANDA that Teva did not infringe these patents and/or that they were not valid. After filing the ANDA, Teva initiated a Declaratory Judgment based upon Pfizer's previously having sued another company for the manufacture of sertraline hydrochloride and due to Teva's having filed the ANDA. The Federal Circuit held that, in order to show a reasonable apprehension of being sued, the Declaratory Judgment Act, 28 U.S.C. §2201(a) requires a showing of actual controversy between the parties. The mere fact that Pfizer complied with 21 U.S.C. §355 did not, in and of itself, present an actual controversy since this provision does not require the patent owner enforce the listed patent. As such, without an affirmative act by Pfizer against Teva, Teva does not have standing to bring a declaratory judgment. Teva Pharmaceuticals USA v. Pfizer, Inc., Civ. Case No. 04-1186 (Fed. Cir. January 21, 2005) petition for reh'g en banc denied Civ Case. No. 04-1186o (Fed. Cir. April 4, 2005).

Attorney/Client Privilege
Invocation of attorney-client and/or work product privilege by infringement defendant does not give rise to adverse inference with respect to willful infringement, since there should be no risk of liability in disclosures to and from counsel in patent matters; nor does defendant’s failure to obtain legal advice give rise to adverse inference, in view of burdens and costs of requirement for early and full study of every potentially adverse patent of which defendant had knowledge. The court answered the following four questions: (1) When the attorney-client and/or product privilege is invoked by a defendant in an infringement suit, is it appropriate for the trier of fact to draw an adverse inference with respect to willful infringement? The answer is “no.” (2) When the defendant had not obtained legal advice, is it appropriate to draw an adverse inference with respect to willful infringement? The answer is again “no.” (3) If the court concludes that the law should be changed and the adverse inference withdrawn as applied to this case, what other consequences are there for this case? The court held that adverse inferences of unfair rule opinions cannot be drawn. (4) Should the existence of a substantial defense to infringement be sufficient to defeat liability for willful infringement even if no legal advice has been secured? The answer is “no.” Precedent includes this factor with others to be among the totality of circumstances, stressing the “theme of whether a prudent person would have sound reason to believe that the patent was not infringed or was invalid or unenforceable, and would have so held if litigated.” (Knorr-Bremse Systeme Fuer Nutzfahrzeuge GmbH v. Dana Corp., 72 USPQ2d 1560, CA FC, 9/13/04).

Not Step-Plus-Function
Recitation of “the method comprises the steps of,” in preamble of claim for cardiac stimulation method, does not convert each ensuing step into step-plus-function limitation under 35 U.S.C. § 112, sixth paragraph, since method claims necessarily recite steps, and use of words “steps of” in preamble does not create presumption of step-plus-function from. The absence of the language “step for” creates presumption that each ensuing step is not step-plus-function form. (Cardiac Pacemakers Inc. v. St. Jude Medical Inc., 72 USPQ2d 1333, CA FC, 8/31/04).

Printed Publication
Prior reference need not have been disseminated by distribution of reproductions or copies, and/or indexed in library or database, in order to constitute “printed publication” under 35 U.S.C. § 102(b), since key inquiry is whether or not reference has been made “publicly accessible”; thus, distribution and indexing are not sole factors to be considered in “printed publication” inquiry. In this instance, a presentation which disclosed every limitation of the invention was displayed for 2.5 days at an association meeting and the same slide presentation was put on display for less than a day at an agricultural station at a university. (In re Klopfenstein, 72 USPQ2d 1117, CA FC 8/18/04).

TLD Indicators
The court did not read the PTO’s policy to include an absolute prohibition on the possibility that adding a TLD to a descriptive term could operate to create a distinctive mark. Instead, the TMEP states that “TLD’s generally serve no source-indicating function, and their addition to an otherwise unregisterable mark typically cannot render it unregisterable.” This language certainly leaves open the possibility that in unique circumstances a TLD could perform a source-indicating function. (In re Oppedahl & Larson LLP, 71 USPQ2d 1370, CA FC, 6/25/04).

Defining Claim Terms
Claim term is given meaning other than its ordinary and customary meaning only in limited situations, and term must be assigned its ordinary meaning if written description and prosecution history are ambiguous as to whether patentee used term in manner inconsistent with such meaning. Claim term will not receive its ordinary and customary meaning only in limited situations. Those situations include: where the patentee has acted as his own lexicographer and clearly provided an alternate definition for the term; where the intrinsic evidence shows that the patentee distinguished invention from a prior art reference, expressly disclaimed subject matter, or highlighted a particular feature as important to the invention; or, where the term chosen makes the scope of the claim so unclear as to require resort to the intrinsic evidence for meaning. (W.E. Hall Co. v. Atlanta Corrugating LLC, 71 USPQ2d 1135, CA FC, 6/7/04).

Prosecution History Estoppel
Rewriting dependent patent claim into independent form, coupled with cancellation of original independent claim, constitutes narrowing amendment giving rise to presumptive surrender of subject matter if dependent claim includes limitation not found in cancelled independent claim, or circumscribes limitation found in that claim, and fact that scope of rewritten claim has remained unchanged will not preclude application of prosecution history estoppel. Thus, the fact that the scope of the rewritten claim has remained unchanged will not preclude the application of Prosecution History Estoppel if, by canceling the original independent claim and rewriting the dependent claims into independent form, the scope of subject matter claimed in the independent claim has been narrowed to secure the patent. (Honeywell Int’l Inc. v. Hamilton Sundstrand Corp., 71 USPQ2d 1065, CA FC, 6/2/04).

Not Means-Plus-Function
Term “baffle,” as used in claims directed to impact-resistant building modules consisting of modular wall panels, is not means-plus-function limitation, since term does not expressly use word “means,” thus raising presumption that it is not subject to 35 U.S.C. § 112, and since word “baffle” which carries ordinary meaning of “something for deflecting, checking or regulating flow,” sufficiently recites structure, even though claims do not identify matter upon which baffle acts. (Phillips v. AWH Corp., 70 USPQ2d 1417, CA FC, 4/8/04) vacated and rev'd on other grounds Phillips v. AWH Corp., 2005 U.S. App. LEXIS 13954 (Fed. Cir. July 12, 2005) (en banc).

Disclosure-Dedication Rule
Subject matter disclosed in written description but not claimed in patent is dedicated to public, and cannot be recaptured under doctrine of equivalents. The disclosure-dedication rule requires an inventor who discloses specific matter to claim it, and to submit the broader claim for examination. Otherwise, that matter is dedicated to the public and may not be recaptured under the doctrine of equivalents. The court held that the disclosure-dedication rule is designed to motivate patentees to draw the broadest claims that they consider to be patentable, and to submit these broad claims to the PTO for examination. The disclosure-dedication rule, should thereby serve the important public notice function of patents-the mechanism whereby the public learns which innovations are the subjects of the claimed invention, and which are in the public domain. The patentee noted in the specification that “other prior art devices use molded plastic…” The written description stated that “the elongated strap is made of resilient metal such as stainless steel although other resilient materials may be suitable for the strap.” These passages demonstrate that, at the time the inventor applied for ‘239 patent, he knew that other materials, including plastic, could be used to make “parts” of his invention, and that the inventor asserted the metal design of the ‘239 patent as an improvement over the prior art. The ‘239 patent, however, does not claim plastic parts, but instead includes an explicit “metal” limitation. (PSC Computer Products Inc. v. Foxconn International Inc., 69 USPQ2d 1460, CA FA, 1/20/04).

Inherent Anticipation
Fact that particular characteristic is necessary feature or result of prior art embodiment of invention is sufficient for inherent anticipation, even if that fact was unknown at time of prior invention. Thus, proof of inherent anticipation does not require showing that person of ordinary skill in art would have recognized that asserted inherent characteristic was necessarily present in thing described in allegedly anticipating reference. (Toro Co. v. Deere & Co., 69 USPQ2d 1584, CA FC, 1/20/04).

Claim Construction
A claim construction that treats the terms “every field” and “each of a plurality of fields” synonymously is erroneous since “plurality” means at least two, thereby suggesting a broader claim scope. In this circumstance “each of plurality of fields” means “each of at least two fields,” not “every field.” (Resqnet.com Inc. v. Lansa Inc., Fed. Cir., 12/16/03).

Prosecution History Estoppel
Redrafting of dependent claim, directed to process for preparation of antibiotic compound, in independent form constituted narrowing amendment made for substantial reason related to patentability, since redrafting further defined and circumscribed existing limitation to put claim in condition for allowance; patentee has failed to overcome presumption that redrafting surrendered coverage of asserted equivalent under Festo. In this instance, the applicant canceled claims 1-10 and submitted new claims 11-16 wherein independent claim 11 was a rewriting of a number of dependent claims into independent form. (Ranbaxy Pharmaceuticals Inc. v. Apotex Inc., 69 USPQ2d 1086, CA FC, 11/26/03).

Prosecution History Estoppel
Amendment that narrows claim in order to comply with any provision act, including 35 U.S.C. § 112, may invoke Prosecution History Estoppel; this rule includes “voluntary” amendments. Further, amendment that narrows claim is presumed to have been made for “substantial reason related to patentability, if record does not reveal reason for amendment; patentee may rebut presumption by showing that amendment was not one relating to patentability, but this rebuttal is restricted to evidence in prosecution history record. Still further, finding that amendment which narrowed claim was made for substantial reason related to patentability imposes presumption that patentee had surrendered all territory between original claim limitation and amended limitation; if patentee fails to rebut this presumption, then Prosecution History Estoppel bars patentee’s reliance on Doctrine of Equivalence for accused element, but if patentee successfully rebuts presumption, then question of whether accused element is in fact equivalent is reached on merits. The three criteria for rebutting the Festo presumption are: (1) patentee to show that an alleged equivalent would have been “unforeseeable at the time of the amendment and thus beyond the fair interpretation of what was surrendered”; (2) patentee to demonstrate that “the rationale underlying the narrowing amendment bore no more than a tangential relation to the equivalent in question”; or (3) patentee to establish “some other reason suggesting that the patentee could not reasonably be expected to have described the insubstantial substitute in question”. (Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., 68 USPQ2d 1321, CA FC, 9/26/03).

Means-Plus-Function Claims
Patents in suit may not be construed, under 35 U.S.C. §112, sixth paragraph, to disclose computer software as structure corresponding to claimed function if patents’ specifications do not clearly link or associate software with that function, since § 112 does not permit patentee to claim in functional terms unbounded by any reference to structure in specification, and since failure to clearly link or associate software with claimed function is also failure to meet § 112’s definiteness requirement. The Federal Circuit held that the Federal District Court correctly found the corresponding structure for the “means for converting said plurality of images into a selected format” to be the VME bus based framegrabber video display board, and the computer video processor. However, the Federal Circuit held that the District Court erred by identifying software as an additional corresponding structure for this limitation. There is nothing in the specification or prosecution history that clearly links or associates software with the function of converting images into a format. A correct inquiry is to look at the disclosure of the patent and determine if one of skill in the art would have understood the disclosure to encompass software for digital-to-digital conversion and been able to implement such a program, not simply whether one of skill in the art would have been able to write such a software system. (Medical Instrumentation and Diagnostics Corp. v. Elekta AB, 68 USPQ2d 1263, CA FC, 9/22/03).

Claim Construction
Specification may limit claims if it suggests, when read as whole, that very character of invention requires limitation to be part of every embodiment. Thus, if specification makes clear at various points that claimed invention is narrower than claimed language might imply, then it is permissible and proper to limit claims. The court recognized that it must interpret the claims in light of the specification, yet avoid impermissibly importing limitations from the specification. This balance turns on how the specification characterizes the claimed invention. The court looks to whether the specification refers to a limitation only a part or less than all possible embodiments or whether the specification read as a whole suggests that the very character of the invention requires that limitation be a part of every embodiment. For example, it is impermissible to read the one and only disclosed embodiment into a claim without other indicia that the patentee so intended to limit the invention. On the other hand, where the specification makes clear at various points that the claimed invention is narrower than the claim language might imply, it is entirely permissible and proper to limit the claims. (Alloc Inc. v. International Trade Commission, 68 USPQ2d 1161, CA FC, 9/10/03).

“About” Not Indefinite
Substantial evidence supports jury’s conclusion that patent disclosing method of fracturing subterranean oil and gas wells is not invalid for indefiniteness or enablement on ground that it uses the term “about 0.06” in referring to concentration of polymer used in fracturing fluid, since person of skill in relevant art would understand range that term was intended to encompass. (BJ Services Co. v. Halliburton Energy Services Inc., 67 USPQ2d 1692, CA FC, 8/6/03).

Defining Claim Terms
The Federal Circuit found that the Federal District Court did not err in looking to dictionary definitions, before patent specification, in construing disputed term “high frequency” in claim for wired broadcasting system. The Federal Circuit noted that dictionaries, encyclopedias, and treatises, publicly available at the time the patent is issued, are objective resources that serve as reliable sources of information on the established meanings that would have been attributed to the terms of the claims of skill in the art. The Federal Circuit also noted that because words often have multiple dictionary definitions, some having no relation to claimed invention, the intrinsic record must always be consulted to identify which of the possible dictionary meaning of the claimed terms in issue is most consistent with the use of the words by the inventor. (Intellectual Property Development Inc. v. UA-Columbia Cablevision of Westchester Inc., 67 USPQ2d 1385, CA FC, 7/21/03).

Prosecution History Estoppel
Narrowing amendment to independent claim at issue was not inadvertent, and was made for substantial reason related to patentability, namely, to avoid prior art. Prosecuting attorney’s declaration that narrowing limitation was added inadvertently cannot be considered in determining reason for amendment, since it is not part of prosecution history, and prosecution history does not show that reason for amendment was inadvertent. The court cannot consider the prosecuting patent attorney’s declaration in determining the reason for the amendment to the claim as only the public record of the patent prosecution, the prosecution history, can be a basis for such a reason. Otherwise the public notice function of the patent record would be undermined. Also, the prosecution history does not show that the reason for the amendment of the “switching” was inadvertent. Although the Remarks section of the amendments indicates that Pioneer amended claim 1 to state claim 6 in independent form, it is equally possible that Pioneer changed the claims intentionally, but inadvertently failed to update the remarks. Pioneer further argues that the amendment adding the “switching” limitation to claim 1 was not related to patentability because it was voluntary and was not offered to overcome any rejection, on prior art or otherwise. However, the mere fact that an amendment is voluntary does not shield it from prosecution history estoppel. (Pioneer Magnetics Inc. v. Micro Linear Corp., 66 USPQ2d 1859, CA FC, 6/2/03).

Nondisclosure of Similar Claims’ Rejection May Void Patents
Failure to disclose the rejection of claims in a copending application before a different examiner that were substantially similar to the asserted patent claims may constitute inequitable conduct that could render the patent unenforceable. The Federal Circuit held that a contrary decision by another examiner reviewing a similar claim meets the threshold materiality test of Akron Polymer Container Corp. v. Exxel Container Inc. and Rule 56, but vacated a summary judgment of unenforceability and invalidity, reasoning that the District Court failed to address intent to deceive. Although the patentee filed a terminal disclaimer limiting the term of its patent, the terminal disclaimer did not include a provision that any patent granted on that application...shall be enforceable only for and during such period that said patent is commonly owned with the application or patent which formed the basis for the rejection. (Dayco Products Inc. v. Total Containment Inc., Fed. Cir., 5/23/03).

Meaning of Claims with “Circuit” Limitations
District court, in concluding that “circuit” limitations in claims for computerized switching systems are means-plus-function limitations, erred by relying on single word “circuit” rather than examining limitations as whole, since every use of term in asserted claims includes additional adjectival qualification that further identifies sufficient structure. A claim term that does not use “means” will trigger the rebuttable presumption that § 112, paragraph 6 does not apply. The presumption can collapse when a limitation lacking the term “means” nonetheless relies on functional terms rather than structure or material to describe performance of the claimed function. To help determine whether a claim term recites sufficient structure, the court must examine whether the claim term has an understood meaning in the art. Thus, the threshold issue for all the limitations involved in the “circuit” is whether the term itself connotes sufficient structure to one of ordinary skill in the art to perform the functions identified by each limitation. While the court did not find it necessary to hold that the “circuit” by itself always connotes sufficient structure, the term “circuit” with an appropriate identifier such as “interface,” “programming,” and “logic,” certainly identifies some structural meaning to one of ordinary skill in the art. The term “circuit” is defined as “the combination of a number of electrical devices and conductors that, when interconnected to form a conducting path, fulfill some desired function.” In light of this definition, it is clear that the term “circuit” by itself connotes some structure. (Apex Inc. v. Raritan Computer Inc., 66 USPQ2d 1444, CA FC, 4/2/03).

Inequitable Conduct
Inventors made misrepresentations in example in specification for claimed thermostable enzyme by writing example in past tense, since reader of patent would conclude that purification protocol described in example was actually performed, and that stated results were actually achieved, whereas evidence shows that example was never performed as described. (Hoffmann-La Roche Inc. v. Promega Corp., 66 USPQ2d 1385, CA FC, 3/31/03).

Defining Claim Term
Term “co-micronization,” as used in composition and method claims for fenofibrate, does not take its ordinary and accustomed meaning, and is properly construed to require micronization of fenofibrate and solid surfactant in absence of other excipients, since term is specifically defined in that manner in patent, and patentee’s definition from specification, thus is properly read into claims. Courts must presume that the terms in the claim mean what they say, and unless otherwise compelled, give full effect to the ordinary and accustomed claim terms. However, in this instance, the patentee has “chosen to be his own lexicographer and has explicitly defined in the patent specification.” (Abbott Laboratories v. Novopharm Ltd., 66 USPQ2d 1200, CA FC, 3/20/03).

Offer for sale
“Commercial offer for sale” under 35 U.S.C. § 102(b) requires communication that offeree could make into binding contract by simple acceptance; special master, proceeding under assumption that “contract law principles do not govern § 102(b) principles” erred in applying standard requiring something less than formal offer. (Lacks Indus. Inc. v. McKechnie Vehicle Components USA Inc., 66 USPQ2d 1086, CA FC, 3/13/03).

Trident owns U.S. patent no. 5,343,226, which claims a patent on an ink jet device and supply system used in the manufacture of printers. Trident also manufactures ink for use in the patented ink jet device. In licensing agreements with OEM manufacturers to use the patented ink jet device, Trident required the OEM manufacturers to purchase from Trident the ink used to refill the licensed ink jet devices. A competitor, Independent Ink, sued Trident claiming that the license agreements constitutes a per se illegal tying arrangement in violation of the Sherman Act, 15 U.S.C. §1 et seq. Specifically, Independent Ink asserted that license illegally tied the licensing of the patented ink jet with the purchase of unpatented ink.

While the District Court held that such tying arrangements require a showing of market power in the market for the patented ink jet device, the Federal Circuit overturned the District Court's decision. Specifically, in Independent Ink, Inc. v. Illinois Tool Works, Inc., et al., 396 F.3d 1342; 73 U.S.P.Q.2D 1705 (Fed. Cir. 2005), the Federal Circuit noted that, as required by the Supreme Court in Jefferson Parish Hospital District No. 2 v. Hyde, 466 US 2, 16 (1984) and International Salt Co. v. United States, 332 US 392 (1947), where the tying product is patented, there is a presumption of market power in the tying market. The Federal Circuit specifically noted that, in comparison with recent trends to require a showing of market power for non-patented tying goods, the treatment of patented tying products and the presumption of market power has been "more consistent" than for unpatented products. (Opinion at Pg. 8). As such, while there is considerable criticism of the presumption of market power for patented products and while the prosecutorial guidance set forth in the Department of Justice's Antitrust Guidelines for the Licensing of Intellectual Property (1995) indicates that no presumption of market power exists based only upon a patent, this criticism and exercise of prosecutorial guidance "does not affect the validity of the Supreme Court's decisions in International Salt and [United States v. Loew's Inc., 371 US 38 (1962)]" such that both International Salt and Loew's remain good law. (Opinion at Pgs. 13 and 14, n. 10). Therefore, the Federal Circuit held that Independent Ink did not need to prove market power in the market of the patented tying product.

The Supreme Court granted certiorari on the issue of whether a patent confers market power for the purposes of tying. After reviewing precedent, the Supreme Court overruled own precedent, finding no presumption of market power for purposes of tying merely because the product is patented. The Court held that prior tying decisions presuming market power were based upon the patent misuse doctrine. However, after these decisions were handed down, Congress passed 35 U.S.C. 271(d) which prevented a presumption of market power for patent product “unless, in view of the circumstance, the patent owner has market power in the relevant market for the patent or patented product on which the license or sale is conditioned.” Thus, since the underpinning of the presumption of market power in patented products in the context of tying is based on patent misuse law, to make antitrust law and patent misuse law similar, there can be no presumption of market power. As noted by the Court, “[i]t would be absurd to assume that Congress intended to provide that the use of a patent that merited punishment as a felony would not constitute ‘misuse.’”

The Supreme Court did not hold that patents cannot be basis for illegal tying. Instead, the Supreme Court held that, consistent with normal tying cases, there needs to be evidence of market power in the tying product and no special presumption exists through the existence of a patent.

To read more about this case, please refer to Illinois Tool Works Inc. v. Independent Ink Inc., 126 S. Ct. 1281, 77 U.S.P.Q.2d 1801 (2006).

The United States Supreme Court Grants Certiorari on Issue of Obviousness
On June 26, 2006, the United States Supreme Court granted certiorari in order to review the current state of obviousness under 35 U.S.C. §103 as interpreted by the Federal Circuit. The case is an appeal from Teleflex v. KSR, Civ. Case. No. 04-1152 (Fed. Cir. 2004) (unpublished). In KSR, Teleflex sued KSR for alleged infringement of U.S. Patent No. 6,237,565, which claims a gas pedal/electronic sensor combination. The District court granted summary judgment to the defendant since the invention was obvious based upon the nature of the problem to be solved. In making this determination, the District Court summarily held that the nature of the problem (creating a smaller, less complex, cheaper pedal assembly), combined with the prior art, implicitly suggested this combination. The District Court made no finding that this suggestion was in prior art, and instead made an assertion that the combination was in nature of problem without making specific findings of fact to support this determination.

The Federal Circuit reversed the District Court since the district court had improperly applied the standard for obviousness. Specifically, the Federal Circuit held that, for obviousness, the “teaching-suggestion-motivation” test is used to prevent impermissible hindsight. Under this test, there need to be finding of fact as to whether the prior art teaches, suggests, or motivates a particular combination. Federal Court vacated and remanded since the reliance on the nature of the problem to “suggest” is not proper application of the test unless there are factual findings that this suggestion is in prior art.

At the request of, among others, the Solicitor General of the United States, the Supreme Court granted petition for certiorari on June 28, 2006. The Petition was granted on the following issue:

Whether the Federal Circuit has erred in holding that a claimed invention cannot be held “obvious”, and thus unpatentable under 35 U.S.C. § 103(a), in the absence of some proven “‘teaching, suggestion, or motivation’ that would have led a person of ordinary skill in the art to combine the relevant prior art teachings in the manner claimed.”

According to well-established principles of equity as articulated by the Supreme Court, a plaintiff seeking an injunctions must satisfy a four-factor test before a court may granted relief. The plaintiff must show (1) that it has suffered an irreparable injury, (2) that remedies available at law, such as monetary damages are inadequate to compensate for that injury, (3) that, considering the balance of hardships between the plaintiff and defendant, a remedy in equity is warranted, and (4) that the public interest would not be disserved by an injunction. The Supreme Court held that the District Court had not applied those rules and needed to apply the grant or denial of the permanent injunction in accordance with this framework. Once properly applied, the Supreme Court held that the District Court’s decision was reviewable by the Federal Circuit to determine if the lower Court had abused its discretion.

The Supreme Court then took issue with the holding of the Federal Circuit in regards to the “general” rule, unique to patent disputes, “that a permanent injunction will issue once infringement and validity have been adjusted”, and that injunctions should be denied only in unusual cases, involving exception circumstances to protect the public interest. The language of the Supreme Court’s decision is telling: “Just as the District Court erred in its categorical denial of injunctive relief, the Court of Appeals erred in its categorical grant of such relief.” The last two paragraphs of the Supreme Court’s decision speak eloquently for themselves:

Because we conclude that neither court below correctly applied the traditional four-factor framework that governs the award of injunctive relief, we vacate the judgment of the Court of Appeals, so that the District Court may apply that framework in the first instance. In doing so, we take no position on whether permanent injunctive relief should or should not issue in this particular case, or indeed in any number of other disputes arising under the Patent Act. We hold only that the decision whether to grant or deny injunctive relief rests within the equitable discretion of the district courts, and that such discretion must be exercised consistent with traditional principles of equity, in patent disputes no less than in other cases governed by such standards. Accordingly, we vacate the judgment of the Court of Appeals, and remand for further proceedings consistent with this opinion.

A copy of the case is available at eBay Inc. v. MercExchange LLC, 78 USPQ2d 1577 (Sup. Ct. 2006).

Supreme Court Finds Existence of Patent Does Not Confer Market Power Sufficient to Find Antitrust Injury

Court overrules precedent holding that market power presumed in tying product tied to unpatented tied product

Federal Circuit Overruled District Court on Issue of Tying
While the District Court held that such tying arrangements require a showing of market power in the market for the patented ink jet device, the Federal Circuit overturned the District Court's decision. Specifically, the Federal Circuit noted that, as required by the Supreme Court in Jefferson Parish Hospital District No. 2 v. Hyde, 466 US 2, 16 (1984) and International Salt Co. v. United States, 332 US 392 (1947), where the tying product is patented, there is a presumption of market power in the tying market. The Federal Circuit specifically noted that, in comparison with recent trends to require a showing of market power for non-patented tying goods, the treatment of patented tying products and the presumption of market power has been "more consistent" than for unpatented products. (Opinion at Pg. 8). As such, while there is considerable criticism of the presumption of market power for patented products and while the prosecutorial guidance set forth in the Department of Justice's Antitrust Guidelines for the Licensing of Intellectual Property (1995) indicates that no presumption of market power exists based only upon a patent, this criticism and exercise of prosecutorial guidance "does not affect the validity of the Supreme Court's decisions in International Salt and [United States v. Loew's Inc., 371 US 38 (1962)]" such that both International Salt and Loew's remain good law. (Opinion at Pgs. 13 and 14, n. 10). Therefore, the Federal Circuit held that Independent Ink did not need to prove market power in the market of the patented tying product.

Supreme Court Definitively Holds Patents Do Not Automatically Confer Market Power
In distinguishing from the existing tying case law found in Jefferson Parish Hospital District No. 2 v. Hyde, 466 US 2, 16 (1984) and International Salt Co. v. United States, 332 US 392 (1947), the Supreme Court held that the subsequent amendment of the Patent Act at 35 U.S.C. §271(d) removed the presumption of market power in a patented product. As such, for a tied purchase of patented and unpatented goods to be an unlawful tying arrangement, the mere fact that the patent was used to require the purchase of unpatented goods does not evidence an antitrust injury. Instead, there needs to be evidence that the patent owner has sufficient market power in the tying product beyond the mere existence of the patent.

A copy of the case is available at Independent Ink, Inc. v. Illinois Tool Works, Inc., et al. No. 04-1329 (Sup. Ct. March 1, 2006).

Significance of case for licensing and Sale of patented goods
In its decision, the Supreme Court has confirmed the changing attitude that the courts are applying to patented goods. Specifically, the Supreme Court vindicated the Department of Justice and others in their opinion that patents do not, by themselves, confer market exclusivity in a manner which is necessarily harmful to the consumer. Moreover, the Supreme Court recognized that there can be competitive benefits to such tying arrangements which might justify what is otherwise a seemingly harmful tie. Therefore, patent owners can more easily license or sell patented and unpatented goods without inadvertently violating U.S. antitrust laws, which was easily accomplished under the previous per se rule.

Supreme Court to Review Scope of Patentable Inventions
On October 31, 2005, the Supreme Court granted certiorari in the case of Laboratory Corporation of America v. Metabolite Laboratories (LapCorp). The Supreme Court announced that it will hear LabCorp’s appeal the Federal Circuit’s decision on the scope of patentable subject matter under 35 U.S.C. 101 with respect to patent claims that involve laws of nature, natural phenomenon and abstract ideas. The Supreme Court will review the question of whether a patent can claim rights to a basic scientific relationship used in medical treatment if the claim is limited to “correlating” test results.

This case involves the scientific discovery that levels of homocysteine in the blood can indicate a deficiency in two B vitamins. The claim at issue, claim 13 of Metabolite’s U.S. Patent No. 4,940,658, is directed to a method of detecting a vitamin B deficiency which comprises assaying a body fluid for an elevated level of total homocysteine and then correlating an elevated level with the vitamin deficiency. Claim 13 recites as follows:

A method for detecting a deficiency of cobalamin or folate in warm-blooded animals comprising the steps of: assaying a body fluid for an elevated level of total homocysteine; and correlating an elevated level of total homocysteine in said body fluid with a deficiency of cobalamin or folate. There is nothing novel about testing the blood for levels of homocysteine. The only novel and non-obvious part of the claim is the scientific discovery, the "correlating" step.

On appeal, the Federal Circuit found the claim to be valid and willfully infringed. In particular, the Federal Circuit found that the defendant had induced infringement through its publications advising doctors that elevated levels of total homocysteine correlate with vitamin B deficiency.

LabCorp argues that claim 13 is invalid for a number of reasons. LabCorp points out that although the claim requires a step of “correlating,” there is no description of how the correlation would take place. According to the petitioner, “[s]uch a vague claim cannot be valid; for if it could be, parties could claim patent monopolies over basic scientific facts rather than any novel inventions.” In addition, the claim arguably fails the written description requirement because “the specification does not describe what a practitioner must do to perform the active ‘correlating’ step.”

Prior to grating certiorari, the Supreme Court invited the U.S. Government to file a brief addressing the validity of the claim. The Government recommended against certiorari on grounds that the record was not sufficiently developed with respect to certain fact questions. The Supreme Court, nevertheless granted certiorari and will review as to whether a claim can validly cover a basic scientific relationship used in medical treatment such that the claim is necessarily infringed when a doctor merely thinks about the relationship after looking at a test result. The Supreme Court appears to be bending on making this case a question of subject matter patentability. If the Supreme Court takes that route, it will likely answer many of the questions left open by Lundgren and Fisher. By deciding to hear LabCorp, a question of subject matter patentability, the Court may be responding to recent struggles in the PTO, Board of Patent Appeals and Interferences (BPAI), and Federal Circuit. Recently, the Federal Circuit decided that expressed sequence tags (“ESTs”) are not patentable under 35 U.S.C. § 101, basing its decision on the Supreme Court's directive in Brenner v. Mason, requiring that inventions must have a substantial and specific utility under § 101. Since then, the BPAI has held that “there is currently no judicially recognized separate ‘technological arts' test to determine patent eligible subject matter under § 101.” Most recently, the PTO has provided examiners with new guidelines about patentable subject matter. By granting review, the Court may clarify the debate over the scope of patentable subject matter. However, as a general rule, the decisions from the Supreme Court raise more questions than they answer. For example, how the Supreme Court resolves the issue in Labcorp may also have substantial implications for the patentability of business methods and even of software.

Supreme Court Sets Standard For Inducement for Copyright Infringement
In Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 162 L. Ed. 2d 781 (U.S. Sup. Ct. June 27, 2005), the Supreme Court found defendant Grokster for inducement to infringe copyrights without regard to whether Grokster's technology allows for substantial non-infringing uses. Grokster distributes free software that allows computer users to share electronic files through peer-to-peer networks. Unlike Napster, where one server has references items available, Grokster uses no central servers. While the resulting peer to peer networks can be used to share any type of digital file, there was evidence that Grokster's software was mostly used to share copyrighted music and video files. Additionally, there was evidence that Grokster marketed itself as not reachable by copyright as was Napster. Metro-Goldwyn-Mayer Studios Inc (MGM) and other studios own infringed copies found on the peer-to-peer network created by Grokster's software. MGM sued Grokster alleging that Grokster knowingly and intentionally distributed their software to enable users to infringe copyrighted works in violation of the Copyright Act.

The Supreme Court held that Grokster was liable for inducing infringement through the distribution of its software. In finding infringement, the Supreme Court held that

One who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, going beyond mere distribution with knowledge of third-party action, is liable for the resulting acts of infringement by third parties using the device, regardless of the devices lawful uses.

From this holding, the Supreme Court held that inducement to infringe copyright can be found, but only in limited circumstances where the following elements are shown:

1. Infringed copyright;
2. Must be distributing a device allowing infringement; and
3. Distribution must be with the object of promoting the device in the context of infringing copyrights by clear expression or affirmative steps.

Tillamook County Creamery Association (TCCA) is a long standing dairy cooperative which began using the “Tillamook” mark as early as 1918, and registered the mark in 1921 and 1950. In 1975, a member of TCCA approached TCCA’s General Manager concerning his intention to start a processed meat company to operate under the mark “Tillamook Country Smoker.” The General Manager did not object, and Tillamook Country Smoker (TCS) was born.

From 1976 on, TCS used the “Tillamook Country Smoker” mark with no objection from TCCA. In fact, TCCA offered TCS products for sale in its store and catalogs. TCS attempted to register the “Tillamook Country Smoker” mark but was rejected by the USPTO as “confusingly similar” to TCCA’s mark. However, TCCA itself did not comment on the application though it was notified. In 1995, TCS was successful in registering a combined word and design mark consisting of the words “Tillamook Country Smoker” on a ribbon design. Again, TCCA did not comment.

TCS grew throughout the late 90s, helped by a rebranding and a huge expansion in direct sales to grocery stores and warehouses. Subsequently, TCS again tried to register the “Tillamook Country Smoker” mark; this time the PTO approved, and TCCA lodged its opposition. TCCA also tried to cancel the ribbon mark. The PTO later rejected a “Tillamook Jerky” mark as highly similar to TCCA’s “Tillamook” mark.

In 2005 TCCA submitted a cease-and-desist letter to TCS. TCS then brought suit seeking declaratory judgments 1) declaring TCS the owner of the “Tillamook Country Smoker” and finding it non-infringing; 2) declaring the ribbon mark to be valid; and 3) entitling TCS to the registration of the “Tillamook Country Smoker” mark. TCCA asserted counterclaims 1) seeking an injunction preventing TCS’s use of the name “Tillamook” or any other likely confusing mark and 2) seeking an order declaring that use of “Tillamook Country Smoker,” “Tillamook Jerky,” and “TillamookJerky.com” infringed on TCCA’s registered mark.

Trademark Infringement Claim Fails
The Ninth Circuit affirmed the grant of partial summary judgment to TCS on the use of the “Tillamook Country Smoker” mark. The court found that the limitations period for laches started in 1975, when TCCA first had notice of the possibility of confusion, not 1998 when TCS began to expand into supermarket sales. TCCA had a protectable interest in 1975, and while at that point they may not have operated in identical commercial channels, their similar marks, complementary products, and similar geographic region should have put TCCA on notice of the possibility of confusion.

Presumption in favor of laches defense
Neither party disputed the district court finding that the most analogous causes of action would have had their statutes of limitation run after either 2 or 10 years. Since 25 years had passed since the date on which the court held that TCCA had notice, there was a strong presumption favoring TCS’s laches defense.

Progressive encroachment not found
TCCA claimed that the doctrine of “progressive encroachment” excuses their absence of enforcement for most of TCS’s history. Under this doctrine, a trademark owner need not sue for de minimus infringement but may wait until the junior user moves into direct competition and causing actual market confusions.

The court found that the district court did not abuse its discretion in rejecting TCCA’s progressive encroachment claim. The district court reasonably found that TCS’s use of the “Tillamook Country Smoker” mark had been constant over the entire period, and the rebranding (font, design, and color) did not make the mark more similar to TCCA’s products. Neither did the district court abuse its discretion in finding that TCS’s expansion of supermarket sales represented normal business growth, not progressive encroachment, since the product being sold was still the same, and it was being sold in the same region.

“Good faith” found
Bad faith actions negate a laches defense, but the district court found good faith on the part of TCS. The court emphasized the permission-seeking meeting between TCS and TCCA at the formation of TCS, as well as the fact that TCCA had sold TCS items in its own magazine for years. Both facts were clear evidence of good faith on TCS’s part.

No Injunction Based On “Inevitable Confusion”
A otherwise successful laches defense may be defeated if doing so is in the public interest. However, this is a narrow exception and will only be used when the confusing product is “harmful or otherwise a threat to public safety and well-being.” Since TCCA did not claim that TCS’s products are harmful in any way, the district court was correct in denying TCCA’s claim for injunctive relief based on inevitable confusion. In fact, TCCA is at least partly responsible for any confusion by selling the TCS products in its catalog.

No Invalidation of TCS’s Registered Marks
The court upheld the district court’s finding that TCCA admitted during discovery that TCS’s use of the “Tillamook Country Smoker” and the ribbon mark did not create a likelihood of confusion. In response to a discovery request, TCCA admitted that TCS began to violate its trademark in the “latter part” of the time period between 1995 and 2000. The district court construed this as admitting that there was no infringement prior to 1997, and thus no likelihood of confusion. Since there was no likelihood of confusion, the marks were correctly granted to TCS. Thus, the court upheld the district court’s grant of summary judgment to TCS with respect to the registration claim.

Distributor Mid-State advertised “MQVP parts available” to its customers. Mid-State refused to license the use, continuing to use the service mark, MQVP®, while informing customers that it was not a participant in the program. Defendant brought Lanham Act claims of infringement (15 U.S.C. § 1125(a)(1)(A)) and false advertising (15 U.S.C. § 1125(a)(1)(B)) by Mid-State.

Although MQVP® is a service mark, rather than a trademark, the court, citing Frehling Enters, Inc. v. Int’l Select Group, Inc., 192 F.3d 1330, 1334 n.1 (11th Cir. 1999), stated that a service mark can also be used to describe products as long as it also described some associated services. Further, the court noted there was dispute as to whether MQVP used the mark to refer solely to products as opposed to services. The court also noted that despite defendant’s description and use of the mark which seemingly appeared as a certification mark, the actual registration was for a service mark and thus eligible for such protection. Indeed, defendant’s description of the mark included participants’ compliance with standards and use of the on-line software tracing system. Thus, the court concluded that the use of the mark and the nature of defendant’s services its use protected were disputed issues.

Lastly, Mid-State had argued that a Lanham analysis did not apply since Mid-State’s customers were repair shops, not the likely manufacturer/distributor customers of the defendant. The court did not allow this narrow interpretation, instead noting that the confusion element of Lanham applied to those in positions to influence purchasing or whose confusion presents a risk to sales of the trademark owner. The circuit court held that Mid-State’s unauthorized use of defendant’s mark was for the obvious purpose of confusing and deceiving end users into believing they were buying qualified/complying parts under the MQVP program. The case was remanded to the district court.

LawMode created a package of 576 individual Michigan legal form templates, which were marketed and sold under contract by Lexis Nexis for five years. After terminating the contract, Lexis Nexis offered its own package of 406 individual Michigan legal form templates. LawMode filed a seven-count complaint, all but two of which it voluntarily dismissed. Remaining for the consideration of the court was a copyright claim and a breach of contract claim.

The lower court dismissed the copyright claim, holding that, while LawMode’s selection of forms was copyrightable, the selection was not infringed, and that organization of the forms, look of the screen, and interrelationships of the form variables were not copyrightable.

The Sixth Circuit affirmed, holding that neither of the two copyrightable elements of LawMode’s product – the selection and categorization – were copied by Lexis Nexis. LawMode’s selection of 576 from a universe of over 700 forms is copyrightable even if the underlying forms are not themselves copyrightable. However, the court held that because Lexis Nexis only included 61% (350 of 576) of the same forms as LawMode’s product, this was not substantial verbatim copying and thus not copying under the strict standard set by the Supreme Court in Fiest Publications v. Rural Telephone Service Company. 499 U.S. 340 (indicating that facts can be used in a competing work so long as the competing work does not have the same selection).

Similarly, the court held that the form categories used in the two products were not similar enough to constitute infringement on Lexis Nexis’s part. Where they are similar, the court noted, was in headings and classifications that had previously existed on the state of Michigan website organizing its versions of the forms. Lexis Nexis did not copy any of the non-obvious and non-public use categories that LawMode had created.

Next, the court held that the appearance of dialog boxes used to input information on the forms were not sufficiently original to be copyrightable. The court noted that the reason both product’s dialog boxes look similar was because both relied on the same default setting in the commercial form-creating software use by both companies. Choosing the default setting was too trivial to be original, according to the court.

Likewise, the court held that the interrelation between the variables in the forms was not protectable by copyright. The court held that these relationships were non-creative because the relationships were compelled by the express terms of the underlying state-created forms. For example, permitting the form user to choose either the district or circuit court conveys no information beyond the pre-existing requirement that the form be filed in only one court. Since the interrelationships conveyed no information beyond that on the face of the form, the interrelationships themselves are not eligible for copyright.

While the Fourth Circuit affirmed the dismissal of LawMode’s copyright claims, it reversed the lower court’s dismissal of the contract claims under rule 12(c). The Fourth Circuit found that, assuming LawModes’s factual allegations were true (as rule 12(c) requires), LawMode had stated a claim for breach of contract. Therefore, the court remanded the case for further consideration of the breach of contract claim.

BondPro demonstrated to Siemens a particular method of bonding insulation to U-shaped slots that form part of Siemens’ generators, hoping to license the technique. Siemens, although told by BondPro that this technique was proprietary, later applied for a patent on a similar process. The Patent Office rejected the application and neither Siemens nor BondPro ever put the method into use. Yet BondPro sued for theft of a trade secret. The district court jury found for plaintiff BondPro, but the judge found for the defendant Siemens as a matter of law. BondPro appealed.

After resolving several jurisdictional issues that resulted largely from the sloppiness of the lawyers in this case, the court turned to the issue of if there is a case or controversy. Here, the court explained that to have a case or controversy, BondPro needs to showing that it has something tangible to gain from reinstating the jury’s verdict. Thus the court examined the claimed trade secret to see if it has value.

The court pointed out that in many cases applying for a patent on what was previously a trade secret will destroy that trade secret by making it public knowledge, even if no patent is granted, since the PTO publishes applications after 18 months. However, in this case, Siemens allegedly stole the secret method, and in these circumstances would be liable.

Liable for what? Judge Posner precluded money damages, noting that there was no evidence that the technique had any commercial value whatsoever. Yet he inquired further into injunctive relief. BondPro appeared to have taken the proper steps to protect its trade secret, avoiding invalidation by its own inaction.

It all comes down to, in the court's opinion, what the claimed trade secret is. The general process as described in the first claim of the Siemens application was arguably something known in the trade already, as it had been demonstrated at a year 2000 trade convention. But no further details of its secret process were provided by BondPro at trial. The court noted that usually one expects trade secrets to be highly detailed because general processes will most often be known to experts in the field. Since BondPro has not provided details that would distinguish its “trade secret” from publicly-known methods, the court concluded that there was no trade secret. Since there was no trade secret, BondPro has nothing to gain from reinstating the jury verdict; and thus there was no case or controversy as required by the Constitution. As such, the district court’s JNOV is affirmed.

Specifically, the Sixth Court found that the DMCA did not prevent SCC's creation and distribution of the chip since the chip did not prevent the unauthorized access of the Printer Engine Program resident on the printer. The Sixth Circuit also held that SCC's chip did not prevent the unauthorized of access of the Toner Loading Program since the Toner Loading Program was held to not be copyrightable. Therefore, even though the Toner Loading Program was copied onto SCC's chip and the algorithm designed to protect access to the Toner Loading Program was admittedly broken, the DMCA did not prevent this access. Lexmark Intern'l, Inc. v. Static Control Components, Inc., 387 F.3d 522; 72 U.S.P.Q.2D 1839 (6th Cir. 2004) reh'g denied, 2004 U.S. App. LEXIS 27422 (Dec. 29, 2004), reh'g en banc, denied, 2005 U.S. App. LEXIS 3330 (Feb. 15, 2005).

While the Sixth Circuit's decision merely remanded the case for further proceedings and has not yet been finalized, the Sixth Circuit succinctly pointed out the possible deficiencies in the DMCA as applied to printer products:

1. the work being protected by the technology measure needs to be copyrightable;
2. some technological protection must prevent access to the copyrighted work; and
3. the user alleged to be accessing the work must not be authorized (i.e., license must restrict right to access copyrighted work).