Litigation by unfair surprise is out, at least for US patent PTAB cases — for European patent oppositions, not so much.
One thing that I will never forget about my experience with European patent oppositions is that to American eyes, the European process appears to be rather “due process of law” impaired.
For example, although in theory, issues should be argued in advance by written briefs, the European opposition process also allows parties to introduce new issues during the last minute oral arguments.
This allows for litigation by “unfair surprise”, rather than by reasoned arguments. In this sort of setting, I have seen that illogical but last minute “Chewbacca defenses” can work quite well. The clock is ticking, proceedings are going to finish in an hour, and suddenly you have to discuss entirely new and logically irrelevant issues. It is as if you suddenly have to shift gears and focus on if the Star Wars character Chewbacca lives on the planet Endor or not.
In this regard, it is refreshing to see that the Federal Circuit in Dell Inc., v. Acceleron, LLC (March 15, 2016) has confirmed that this sort of litigation by unfair surprise is unacceptable for US PTAB patent reviews. Due process wins — arguments made during oral argument must be restricted to only those arguments previously discussed in writing beforehand.
Prior art searches: Before investing a lot of time, effort, and money in trying to patent a potential new invention, it is always good to spend at least a few hours doing patent searches to see if there is any prior art (earlier patent or non-patent publications) that might cause problems. As a rule of thumb, if you haven’t found any prior art that concerns you at least a bit, then you probably haven’t looked enough yet!
Why do this? Because eventually, skeptical USPTO examiners will be going through your patent application, looking for ways to reject on the basis that the application is either not novel or obvious in view of prior art.
Patent examination is an adversarial process. Patent examiners have, in effect, quotas which require them to initially reject most patent applications. It is a bit of a game, like tennis, where the examiner initially rejects by citing some combination of prior art. The examiner then hits the ball back onto the applicant’s side of the court. The examiner is expecting the applicant to hit the ball back onto the examiner’s side of the court by submitting convincing arguments pointing out where the examiner was wrong. If the applicant can convincingly argue that the examiner is wrong, usually (often after a few additional volleys), the examiner allows the patent, and the applicant wins. But if the applicant cannot argue back convincingly, it is like dropping the ball or hitting the ball back out of bounds. The applicant loses, and that patent application is going nowhere.
The patent examiner typically starts by doing computer searches for prior art using search terms that the examiner thinks will work best. This computer search will come up with unexpected citations, which the examiner may in turn combine in unexpected ways to try to show that the invention is “obvious”. Because of the quota to initially reject almost everything, often these initial rejections are unreasonable. Unreasonable rejections are “good news” in disguise, because the applicant can then rebut these by reasonable arguments. It is the reasonable rejections that are the real “bad news”, because these are harder to argue against. So before putting a lot of time and money into an invention, it is a good idea to do at least some initial checking to see what the examiner (or for that matter, a competitor) might try to use against you later. This is the idea behind a “feasibility study” type prior art search.
Sometimes, particularly when the inventor or inventors are experts, the inventors themselves may decide that they are sufficiently familiar with their field so that the search-time expense/benefit ratio is low, and no additional prior art searches are worthwhile. Here, since the USPTO will do an independent search anyway, the only obligation that the inventors have is to inform USPTO of the most important prior art that they are aware of.
Other times, particularly when the inventor or inventors are working in an area that is new to them, prior art searches have a better search-time expense/benefit ratio. Here many good sources are available over the Internet, including Google, Google patents, Google Scholar, the USPTO patent database, the WIPO patent database, and the like.
Some common mistakes that inventors make is to underestimate the amount of prior art that a patent examiner can use against their invention. Although pretty much everyone understands the problem of prior patent applications by others, this is only part of the prior art problem.
For example, for the US, anything published more than a year ago can be used against your invention, including your own publications. This includes that “cool” YouTube video, that “cool” social media posting, or that research paper/thesis that you may have published last year. Foreign patent offices are even worse in this regard. Patent examiners know that often the inventor’s own worst enemy is the inventor’s own earlier publications. As a result, patent examiners often specifically search for the inventor’s own publications and internet postings to use against them.
Another problem that inventors sometimes have is that they are a bit too emotionally attached to their cool new idea. This problem can result in sub-optimal prior art searches. The inventor may, perhaps subconsciously, avoid search strategies that may kill that shiny new idea.
Here, there are several advantages to having a patent attorney do a quick feasibility prior art search for you. One is that the patent attorney does prior art searches all the time. Another is that the patent attorney, being both less emotionally invested in the idea, and being expert in finding prior art, may have an easier time thinking of thorough search strategies. The third is that often doing the search helps the patent attorney understand variants of your idea better, which can translate into a better patent application.
For example, if something highly relevant comes up (and often something does come up), then the new idea can be better evaluated in the context of this new-found prior art. The scope of the initial idea may be altered or expanded, and a better patent application can result. Worst case, if it becomes clear that the idea has been done before, then time and money can be saved. Alternative ideas can be explored instead.
In conclusion, “feasibility study” type prior art searches are a good way to get at least a rough estimate of the legal feasibility of a new idea. Although the prior art search may uncover what looks at a first glance to be a tough obstacle, often this initial obstacle may encourage further thinking and improvements to the initial idea, resulting in a better patent down the road.
Note that in addition to “feasibility study” type prior art searches, there are other types of patent searches called “freedom to operate” searches or opinions as well. These represent a different and more extensive type of search, and this is a different topic.
What to do about “Alice”? The US Supreme Court’s “Alice” decision has invited us all to a Mad Tea Party. What fun! But, as previously discussed, if you like logical coherency, or even just want to keep from crashing the economy, there are a few problems with this decision.
Attorney Louis Hoffman, writing in ipwatchdog.com, sums up some of these recent”Alice” problems nicely.
Damaging the economy: As Louis points out, some of the most important areas of US technology are based on software, business methods, and biotechnology. The USPTO has recently taken upon itself to reject many patents in this area. However this loss of patent coverage can impede the economy by making investments difficult, and/or by driving inventions underground in the form of trade secrets.
What about actual (written) patent law? Article I, Section 8, Clause 8 of the US Constitution has empowered Congress to: “promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”
Congress has done so, and has determined under 35 USC 101 that: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”
If you want to know what’s important about this case, it’s right there: the Court’s acknowledgement that the judge-made “exclusionary principle” has the potential to “swallow all of patent law” because “all patents” are at some level based on the very things that can’t be patented under the judge-made doctrine.
Decisions, decisions: So the Alice decision, read too broadly, produces an unconstitutional result. At some point, there will be likely corrective action. However the practical question that some inventors, particularly business method inventors, have to address today is: file a patent and risk an “‘Alice” rejection, or don’t file a patent and be certain that the invention will become public domain?
In my opinion, part of the “Alice” patent problem is that few true impartial (i.e. neutral) judges have really been involved yet.
Both the USPTO and Federal judges have at least a subconscious incentive to get complex patents off of their respective desks with a minimum of time and effort. Why fill your head with complex matters — just say the patent is “abstract”, and the problem is gone. Instant relief! So perhaps there is an inherent conflict of interest built into the legal system in this regard.
So, as the Supreme Court itself warned, Alice will continue to swallow up more and more patent law until it finally reaches an opposing force. Given our legal system, this opposing force may have to be formed by group of middle to large sized companies. Here, any company that doesn’t depend on either advertising, copyrights, or non-innovative technology might be a potential candidate for such a group.
Perhaps some of the presently pending cases will eventually put some boundaries here.
Legal confusion: There remains a lot of legal confusion in the US regarding the question, are software inventions patentable? How to answer this question? We could of course look at the letter of the law (e.g. 35 USC 101), which would give us the rather boring answer that software is patentable. But if someone doesn’t want software to be patentable (and a number of large powerful companies do not), that’s not the answer they want.
How else might we get an answer? In ancient Greece we might consult the Oracle at Delphi, or perhaps sacrifice a goat and examine its entrails. However in the modern US, we know that this is silly. As we all know, the modern US way to decide this is to put this question to a small panel of elderly individuals who know nothing about software or patent law. We call this small panel the Supreme Court of the United States (SCOTUS).
To answer questions, the Oracle at Delphi inhaled vapors, fell into a trance, and then spoke in riddles. These were then interpreted by various priests. In much the same way, SCOTUS (hopefully without the aid of vapors) has given us some confusing and inconsistent rulings, such as the CLS Bank v. Alice Corporationdecision, that in essence are riddles that must be interpreted by various priests (e.g. lower courts, the USPTO).
So in “Alice”, SCOTUS told us that “abstract ideas” are patent ineligible, and also told us that “In any event, we need not labor to delimit the precise contours of the “abstract ideas” category in this case. It is enough to recognize that there is no meaningful distinction between the concept of risk hedging in Bilski and the concept of intermediated settlement at issue here. Both are squarely within the realm of “abstract ideas” as we have used that term.”
So the ruling in essence is the riddle: “abstract ideas are not allowed“, and “abstract ideas are undefined”. This is a pretty good riddle. So the next step is, now that the Oracle (err… SCOTUS) has spoken, how are the various priests (err… the USPTO and lower courts) going to interpret this riddle?
Some good news on this front. On December 16, 2014, the USPTO issued its “2014 Interim Guidance on Patent Subject Matter Eligibility”, available here:
Among other things, the USPTO appears to be heading towards the interpretation that when given incoherent rulings, at least try to minimize damage by applying the rulings narrowly. Thus the latest guidance instructs examiners to perform detailed analysis, and look for specific problems such as financial hedging and mitigating settlement risks, rather than generally rejecting everything. The Guidance also advises examiners that even if a patent hits on a “forbidden area” (judicial exemption), so long as the claim does not seek to tie up the judicial exemption so that others cannot practice it, the claim is probably OK. (Note added 4-26-16 — sadly the USPTO has not followed their own guidance consistently. The official patent examination “MPEP” rules for eligibility are still literally a blank page).
Pushing the limits of copyright law: A recent copyright court case: Oracle America, Inc. v. Google Inc. is showing that at times, the difference between patents and copyrights is not as distinct as you might think or like. You can see the court decision here:
As I understand it, Google attempted to reverse engineer Java by using standard “clean room” (e.g. fresh and original code) techniques. However in the case of 37 Java API classes, Google copied some elements on the belief (based on prior case law such as a 1995 Lotus v Borland case) that because these API were functional, such functional elements were therefore not copyright protected.
Oracle, which obtained rights to Java when it acquired Sun Microsystems in 2010, did not agree.
In the May 9, 2014 decision, the Court sided with Oracle. The Court rejected the Lotus finding, and about 20 years of legal precedent, that menu structures (being essential to operation), were therefore not copyrightable. Instead, the Court held that elements that can perform a function indeed sometimes can be copyrightable. Indeed, the Court argued that something that can be patented can potentially be copyrighted as well (page 43).
The Court argued that no deference should be given to findings of operation or function and that copyright should be determined by an “abstraction-filtration-comparison” inquiry. Perhaps so, but neither this Court nor the previous Trial court actually attempted to perform this test!
In what looks to me to be an important part of the decision, the Court equated the Java language to the English language and concluded that making the API subject to copyright would not restrict Google from using Java any more than a copyrighted paragraph would hinder other authors from using the English language. “However Google, like any author, cannot employ the precise phrasing or precise structure chosen by Oracle to flesh out the substance of its packages — the details and arrangement of the prose.” (See page 44).
To me, this reasoning appears to be problematic. API are much more fundamental than standard copyrighted paragraphs. API are more akin to the functional neural networks in the human brain that are used to understand various short and common English words and phrases. I can express myself just fine in everyday life without quoting paragraphs from copyrighted novels. However if, due to copyright restrictions, the underlying brain neural networks (or computer software structure) needed to understand many short and common English phrases are off-limits, then copyright turns standard English into a proprietary language. In effect, the court is making large chunks of the Java language proprietary as well.
What is more dangerous: patents go away unless filed within a year of first disclosure, then properly prosecuted, properly maintained, and have a maximum life of 20 years in any event. Trademarks go away unless filed, maintained every 10 years, and efforts are continually expended to protect against the trademark turning generic. But copyrights automatically attach without effort, and are then good for 95 to 120 years without any need for renewal!
The Court remanded the case to the trial court, where other copyright principles such as “fair use” may then get Google out of hot water. However in my opinion, the Court’s analysis missed some key points. We don’t allow short and common English phrases to be subject to copyright because to do so would unduly constrain normal speech. There appears to have been no consideration as to what extent forcing a rewrite of the 37 Java APIs at issue would constrain the universe of previously written Java code, and prevent use of many short and common phrases in the Java language.
Was the Court in essence telling Google that although standard Java is now off limits, they of course are welcome to create their own unique dialect of Java? Put this way, then the decision looks off.
PTAB: The 2011 America Invents Act (AIA) significantly changed many aspects of patent law. One change was to try to improve patent quality by allowing potentially invalid patents to be challenged in new types of post-grant opposition procedures.
The Europeans have had a patent opposition process for years, and having observed it in operation at first hand, I am unimpressed. The European system lacks legal protections that Americans take for granted (e.g. rules of evidence, protections against unfair surprise). It is also possible to game the European system by requesting that the opposition be done in a language that (conveniently) the original European examiner or other parties may not speak. Another problem is that the European opposition review panels operate by making instant verbal “shoot from the hip” decisions, and only “justify” the decisions in writing months later.
The USPTO Patent Trial and Appeal Board (PTAB) has been working to implement an American version of the opposition process. They have been hosting roundtables to show their progress to date and solicit feedback. I attended their April 29, 2014 roundtable at Santa Clara University, and came away favorably impressed.
In my opinion, the real challenge in doing decent post-grant opposition procedures is the delicate balance between trying to bring in more of the legal protections of common law/Federal law rules of evidence and civil procedure (thus improving on the European system), while minimizing the burdens of a conventional trial process. Here, in addition to the obvious high costs and long times associated with conventional trials; there is also an issue of legal expertise.
Conventional patent trials are so complex that typically they are handled by expert litigation attorneys. These litigation attorneys have a detailed knowledge of the trial process, but sometimes less knowledge of patent law and the underlying technology. By contrast, patents are usually prosecuted by patent attorneys who may have very detailed knowledge of patent law and the underlying technology at issue, but often less trial process expertise.
PTAB appears to be attempting to devise a streamlined review system that retains a number of common law/Federal trial conventions and legal protections, without being overly burdensome. In my opinion, their approach does improve on the due process of law deficiencies I noticed in European oppositions. Relative to standard trials, the PTAB approach appears to be relatively simple, and you don’t need to be a litigation expert.
I am hopeful that with some review of the rules of evidence, civil procedure, and of course PTAB procedures, patent attorneys (often most knowledgeable about the patent and related technology) should be able to come up to speed with the new PTAB reviews fairly quickly.
35 USC 103 “obviousness” rejections: The recent Federal Circuit case of Leo Pharmaceutical Products, Ltd. v. Rea, 2013 WL 4054937 suggests that the Federal Circuit may be starting to develop a new set of criteria and arguments that can help protect against hindsight bias in obviousness rejections. In Leo, the Federal Circuit held that “to avoid the trap of hindsight”, probative evidence of nonobviousness should also be considered. What was new was that the Leo court held that this can include both evidence of long felt but unsolved needs, and the length of time between the publication dates of the prior art (used in the obviousness rejection) and the claimed invention. Specifically Leo court held that the existence of a large time gap between the prior art publications, and the invention, can also be used as indicia of non-obviousness.
How long must this time gap be? The Leo court held that given a longstanding need, if the prior art citations used in the obviousness rejection are on the order of about 14-22 years old, then this is too long. That is, such an extensive time delay is probative for non-obviousness because if the combination of such long known citations was actually obvious, then the combination would have been disclosed sooner.
An interesting consequence of this ruling is a novel (but risky) “shoot the moon” type of patent prosecution strategy for obviousness rejections. That is, Leo can be interpreted as a Federal Court suggestion to find out how far back in time the relevant citations actually extend. For example, if the prior art is actually 30 years old, but the citations used to demonstrate the prior art were only 5 years old, the following could be done:
Explore the roots of the 5 year old prior art citation
Trace back to the original 30 year old prior art
Disclose the 30 year old prior art citations
Make a Leo type argument
The logic seems sound – something known 30 years ago was also known 5 years ago. The fact that the citations were not combined until the invention, despite a long-felt need, is probative that that the combination was not obvious.
This is arguably a “shoot the moon” legal strategy (i.e. a long shot). So remember that as always, this is not legal advice, and Kids, don’t try this at home!
35 USC 103 rejections: Ever have something rejected as “obvious” in view of a combination of 5+ references? The re Gorman case is how such absurd rejections are rationalized.
According to MPEP 707 section 7.37.07, arguments that the examiner used an excessive number of citations are presently found to be “unpersuasive”. Section 7.37.07 is based upon an old case In re Gorman, 933 F.2d 982, 18 USPQ2d 1885 (Fed. Cir. 1991). However Gorman uses reasoning that is now obsolete and unsupported due to patent law developments since 1991.
Some key aspects of the re Gorman decision were:
“When it is necessary to select elements of various teachings in order to form the claimed invention, we ascertain whether there is any suggestion or motivation in the prior art to make the selection made by the applicant. Interconnect Planning Corp. v. Feil, 774 F.2d 1132, 1143, 227 USPQ 543, 551 (Fed.Cir.1985). ” ‘Obviousness can not be established by combining the teachings of the prior art to produce the claimed invention,absent some teaching, suggestion or incentive supporting the combination.’ ” In re Bond, 910 F.2d 831, 834, 15 USPQ2d 1566, 1568 (Fed.Cir.1990) (quoting Carella v. Starlight Archery and Pro Line Co., 804 F.2d 135, 140, 231 USPQ 644, 647 (Fed.Cir.1986)).
The extent to which such suggestion must be explicit in, or may be fairly inferred from, the references, is decided on the facts of each case, in light of the prior art and its relationship to the applicant’s invention. As in all determinations under 35 U.S.C. Sec. 103, the decisionmaker must bring judgment to bear. It is impermissible, however, simply to engage in a hindsight reconstruction of the claimed invention, using the applicant’s structure as a template and selecting elements from references to fill the gaps. Interconnect Planning, 774 F.2d at 1143, 227 USPQ at 551. The references themselves must provide some teaching whereby the applicant’s combination would have been obvious”
However since 2007 KSR Int’l Co. v. Teleflex, Inc., 550 U.S. 398, the “teaching, suggestion or incentive” requirement for combining citations is no longer required (although still allowed). When this part of the 1991 Gorman court’s reasoning, shown in the first paragraph above, is removed, it becomes clear that the legal and logical underpinning of their 1991 decision no longer apply!
However under present rules, MPEP 707 section 7.37.07, based upon the now obsolete 1991 Gorman legal reasoning, still acts as a roadblock for any applicant who attempts to argue that the examiner did: “engage in a hindsight reconstruction of the claimed invention, using the applicant’s structure as a template and selecting elements from references to fill the gaps.”
Given that the Gorman court’s assumptions no longer hold, isn’t it time to revisit this case? At present, there is no upper limit to the number of citations that an examiner can apply, and indeed I personally have seen combinations of eight citations used in obviousness rejections.
What is patentable? Perhaps I was too optimistic in my earlier “Prometheus bound (or at least distinguished)” post.
The May 10 Federal Circuit court decision, “CLS Bank v. Alice Corporation” shows that the Federal Circuit is unfortunately still spinning its wheels with regards to determining basic questions about what is patent eligible.
The good news is that the decision’s various logical problems, and the logical problems with the underlying Supreme Court decisions, are being widely publicized. Indeed interest in this decision was so high that the Federal Circuit Court servers crashed under the load of everyone trying to download the decision at once!
If you are interested in seeing the present state of the art in regards to cutting-edge legal confusion, you can download the Federal Circuit decision at: