• Actual Use vs Inherent Disclosure: Endo v. Custopharm
    in: Patently-O  | 

    Actual Use vs Inherent Disclosure: Endo v. Custopharm

    Endo Pharms. Sols., Inc. v. Custopharm Inc., — F.3d —, 2018 U.S. App. LEXIS 19265 (Fed. Cir. 2018).

    by Dennis Crouch

    Endo’s injectable testosterone Aveed is listed in the Orange Book as being covered by Bayer’s U.S. Patent Nos. 7,718,640 and 8,338,395.  Endo and Bayer sued Custopharm after it submitted an Abbreviated New Drug Application (ANDA) to produce a generic version. (Under 35 U.S.C. 271(e), submission of the ANDA is an act of infringement).

    On appeal, the Federal Circuit has sided with the patentee — affirming the district court judgment of validity.

    The claimed invention here requires the use of testosterone undecanoate (TU) at a concentration of 250 mg/ml in a vehicle containing a mixture of about 40% castor oil and 60% benzyl benzoate. (Claim 1 of the ‘640 patent). Three key prior art references are all research articles that report using the same concentration of TU and also the castor oil.  The articles do not, however, actually report that benzyl benzoate was used — it turns out though that the researchers (including one overlapping listed inventor here) used the same 40/60 split of castor oil and benzyl benzoate. 

    Continue reading Actual Use vs Inherent Disclosure: Endo v. Custopharm at Patently-O.

  • Pro se Appellant Burnett loses in a 12(b)(6)/101 case
    in: 未分類  | 

    Pro se Appellant Burnett loses in a 12(b)(6)/101 case

    The outcome was that pro se appellant Burnett lost:


    Carl M. Burnett (“Burnett”) appeals an order of the
    United States District Court for the District of Maryland
    dismissing Burnett’s amended complaint for failure to
    state a claim upon which relief can be granted. Burnett v.
    Panasonic Corp., No. 17-cv-0236 (D. Md. Nov. 1, 2017)
    (“District Court Decision”). Specifically, because the
    district court held that claims 1 and 9 of U.S. Patent No.
    7,107,286 (“the ’286 patent”) are invalid as directed to
    ineligible subject matter under 35 U.S.C. § 101, it concluded
    that dismissal pursuant to Rule 12(b)(6) of the
    Federal Rules of Civil Procedure was appropriate. Burnett
    argues that the asserted claims are patent-eligible,
    that the district court erred procedurally when it failed to
    construe five allegedly disputed claim terms, and that the
    district court violated Burnett’s due process rights when it
    failed to hold Rule 12(b)(6) and claim construction hearings.
    We affirm.

    As to 12(b)(6), the CAFC noted:


    The Fourth Circuit reviews de novo a dismissal under
    Rule 12(b)(6). Monroe v. City of Charlottesville, Va., 579
    F.3d 380, 385 (4th Cir. 2009). “We have held that patent
    eligibility can be determined at the Rule 12(b)(6) stage,”
    but “only when there are no factual allegations that,
    taken as true, prevent resolving the eligibility question as
    a matter of law.”
    Aatrix Software, Inc. v. Green Shades
    Software, Inc., 882 F.3d 1121, 1125 (Fed. Cir. 2018).
    Here, the district court appropriately assessed eligibility
    at the pleading stage because the asserted claims are
    patent-ineligible even when accepting as true all factual
    allegations pled in Burnett’s amended complaint

    Of abstract idea:


    Like the concept of using a formula to convert binarycoded
    decimals into pure binary numerals, which the
    Supreme Court found to be an abstract idea in Gottschalk,
    409 U.S. at 72, the concept of using a formula to convert
    geospatial coordinates into natural numbers, if found
    eligible, “would wholly pre-empt the mathematical formula
    and in practical effect would be a patent on the algorithm
    itself.” Claims 1 and 9 are both directed to a
    similarly abstract idea.

    Of Alice:

    The remainder of Burnett’s arguments related to his
    proposed claim constructions stand for the proposition
    that “the claims recite significantly more than the purported
    idea of a ‘mathematical methodology.’” Appellant
    Br. at 46. But that a claim allegedly contains more than
    an abstract idea does not mean the claim survives step
    one, because, under that inquiry, it is enough that the
    claims are directed to a mathematical methodology at all;
    rather, Burnett’s argument is more appropriately assessed
    under our inquiry in step two. Alice, 134 S. Ct. at
    2355 (assessing under step two whether additional features
    in a claim transform an otherwise a patentineligible
    concept into a patent-eligible concept).

    (…)

    As the district noted, these additional features effectively
    do no “more than simply state the [abstract idea]
    while adding the words ‘apply it.’” Mayo, 566 U.S. at 72.
    The preambles of both claims, as construed by Burnett,
    instruct a user to implement the mathematical methodology
    or instruct using a “geospatial media recorder” to do
    the same. Such “wholly generic computer implementation
    is not generally the sort of ‘additional featur[e]’ that
    provides any ‘practical assurance that the process is more
    than a drafting effort designed to monopolize the [abstract
    idea] itself.’” Alice, 134 S. Ct. at 2358 (quoting Mayo, U.S.
    at 77); accord Gottschalk, 409 U.S at 70–72.

  • Global Innovation Divide: Can Investment In Innovation Bridge The Gap?
    in: Copyright Policy, Development, English, Features, Finance, Innovation/ R&D, IP Policies, Language, Patents/Designs/Trade Secrets, Subscribers, Technical Cooperation/ Technology Transfer, Themes, Trademarks/Geographical Indications/Domains, Venues, WIPO  | 

    Global Innovation Divide: Can Investment In Innovation Bridge The Gap?

    The Global Innovation Index 2018, launched on 10 July in New York, has lauded the rise of China as a model for how other low and middle-income economies can advance on innovation. Amid this optimism, however, the global innovation divide remains in ste…

Actual Use vs Inherent Disclosure: Endo v. Custopharm

Endo Pharms. Sols., Inc. v. Custopharm Inc., — F.3d —, 2018 U.S. App. LEXIS 19265 (Fed. Cir. 2018).

by Dennis Crouch

Endo’s injectable testosterone Aveed is listed in the Orange Book as being covered by Bayer’s U.S. Patent Nos. 7,718,640 and 8,338,395.  Endo and Bayer sued Custopharm after it submitted an Abbreviated New Drug Application (ANDA) to produce a generic version. (Under 35 U.S.C. 271(e), submission of the ANDA is an act of infringement).

On appeal, the Federal Circuit has sided with the patentee — affirming the district court judgment of validity.

The claimed invention here requires the use of testosterone undecanoate (TU) at a concentration of 250 mg/ml in a vehicle containing a mixture of about 40% castor oil and 60% benzyl benzoate. (Claim 1 of the ‘640 patent). Three key prior art references are all research articles that report using the same concentration of TU and also the castor oil.  The articles do not, however, actually report that benzyl benzoate was used — it turns out though that the researchers (including one overlapping listed inventor here) used the same 40/60 split of castor oil and benzyl benzoate. 

Continue reading Actual Use vs Inherent Disclosure: Endo v. Custopharm at Patently-O.

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  • Pro se Appellant Burnett loses in a 12(b)(6)/101 case

    The outcome was that pro se appellant Burnett lost:


    Carl M. Burnett (“Burnett”) appeals an order of the
    United States District Court for the District of Maryland
    dismissing Burnett’s amended complaint for failure to
    state a claim upon which relief can be granted. Burnett v.
    Panasonic Corp., No. 17-cv-0236 (D. Md. Nov. 1, 2017)
    (“District Court Decision”). Specifically, because the
    district court held that claims 1 and 9 of U.S. Patent No.
    7,107,286 (“the ’286 patent”) are invalid as directed to
    ineligible subject matter under 35 U.S.C. § 101, it concluded
    that dismissal pursuant to Rule 12(b)(6) of the
    Federal Rules of Civil Procedure was appropriate. Burnett
    argues that the asserted claims are patent-eligible,
    that the district court erred procedurally when it failed to
    construe five allegedly disputed claim terms, and that the
    district court violated Burnett’s due process rights when it
    failed to hold Rule 12(b)(6) and claim construction hearings.
    We affirm.

    As to 12(b)(6), the CAFC noted:


    The Fourth Circuit reviews de novo a dismissal under
    Rule 12(b)(6). Monroe v. City of Charlottesville, Va., 579
    F.3d 380, 385 (4th Cir. 2009). “We have held that patent
    eligibility can be determined at the Rule 12(b)(6) stage,”
    but “only when there are no factual allegations that,
    taken as true, prevent resolving the eligibility question as
    a matter of law.”
    Aatrix Software, Inc. v. Green Shades
    Software, Inc., 882 F.3d 1121, 1125 (Fed. Cir. 2018).
    Here, the district court appropriately assessed eligibility
    at the pleading stage because the asserted claims are
    patent-ineligible even when accepting as true all factual
    allegations pled in Burnett’s amended complaint

    Of abstract idea:


    Like the concept of using a formula to convert binarycoded
    decimals into pure binary numerals, which the
    Supreme Court found to be an abstract idea in Gottschalk,
    409 U.S. at 72, the concept of using a formula to convert
    geospatial coordinates into natural numbers, if found
    eligible, “would wholly pre-empt the mathematical formula
    and in practical effect would be a patent on the algorithm
    itself.” Claims 1 and 9 are both directed to a
    similarly abstract idea.

    Of Alice:

    The remainder of Burnett’s arguments related to his
    proposed claim constructions stand for the proposition
    that “the claims recite significantly more than the purported
    idea of a ‘mathematical methodology.’” Appellant
    Br. at 46. But that a claim allegedly contains more than
    an abstract idea does not mean the claim survives step
    one, because, under that inquiry, it is enough that the
    claims are directed to a mathematical methodology at all;
    rather, Burnett’s argument is more appropriately assessed
    under our inquiry in step two. Alice, 134 S. Ct. at
    2355 (assessing under step two whether additional features
    in a claim transform an otherwise a patentineligible
    concept into a patent-eligible concept).

    (…)

    As the district noted, these additional features effectively
    do no “more than simply state the [abstract idea]
    while adding the words ‘apply it.’” Mayo, 566 U.S. at 72.
    The preambles of both claims, as construed by Burnett,
    instruct a user to implement the mathematical methodology
    or instruct using a “geospatial media recorder” to do
    the same. Such “wholly generic computer implementation
    is not generally the sort of ‘additional featur[e]’ that
    provides any ‘practical assurance that the process is more
    than a drafting effort designed to monopolize the [abstract
    idea] itself.’” Alice, 134 S. Ct. at 2358 (quoting Mayo, U.S.
    at 77); accord Gottschalk, 409 U.S at 70–72.

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  • CAFC finds D. Del. erred in claim construction in Blackbird v. ELB; Judge Reyna dissents

    The outcome was that the D. Delaware decision of Judge Andrews of noninfringement was vacated:


    Blackbird Tech LLC (“Blackbird”) appeals the U.S.
    District Court for the District of Delaware’s entry of
    judgment of noninfringement of claim 12 of U.S. Patent
    No. 7,086,747 (“’747 patent”) based on its construction of
    “attachment surface.” Because the court erred in construing
    “attachment surface,” we vacate and remand.

    This was an appeal by the patentee Blackbird, owner of the ’747 patent, which is directed to
    energy efficient lighting apparatuses.

    This case went to the CAFC so that a claim construction issue could
    be resolved:


    The parties disputed the meaning of “attachment surface,”
    specifically whether the attachment surface must be
    secured to the ballast cover. Blackbird proposed construing
    “attachment surface” as “layer of the housing to which
    the illumination surface is secured,” and Defendants
    proposed “layer of the housing that is secured to the
    ballast cover and to which the illumination surface is
    secured.” J.A. 7. The district court construed “attachment
    surface” as “layer of the housing that is secured to
    the ballast cover.” J.A. 7–9.

    Following claim construction, Blackbird stipulated to
    noninfringement
    , and the district court entered judgment
    in favor of Defendants. Blackbird timely appeals. We
    have jurisdiction under 28 U.S.C. § 1295(a)(1).

    By a vote of 2-1, the CAFC found D. Delaware erred:

    We conclude that the district court erred in construing
    “attachment surface” to be secured to the ballast cover.
    By its plain language, claim 12 does not require the
    attachment surface to be secured to the ballast cover.

    Judge Reyna dissented:


    Claim 12 does not expressly require that the attachment
    surface be attached to anything other than to the
    illumination surface. However, claim 12 does expressly
    describe a lighting apparatus “for retrofit with an existing
    light fixture having a ballast cover.” ’747 patent col. 11 ll.
    26–27 (emphases added). The majority fails to give
    meaning to these claim terms by holding that “attachment
    surface” means “layer of the housing to which the
    illumination surface is secured,” and concludes that the
    patent owner is entitled to patent scope that is neither
    described in nor supported by the specification.
    The plain language of claim 12, read in the context of
    the specification, implicitly requires that the attachment
    surface be secured to the ballast cover to achieve the
    retrofit function. Apart from the preamble, which the
    parties agree is limiting, claim 12 contains no reference to
    the ballast cover, the existing light fixture, or where or
    how the apparatus is retrofit with the existing light
    fixture. Because the only feature of the existing light
    fixture described in claim 12 is the ballast cover, a person
    of ordinary skill would necessarily conclude that the
    attachment surface is secured to the ballast cover of the
    existing light fixture. This would not be a big leap.

    (…)

    Taken collectively, these disclosures in the claims
    and the specification—and the lack of any reference in the
    intrinsic record showing the attachment surface being
    secured to anything other than the ballast cover—teach a
    skilled artisan that the attachment surface described in
    claim 12 is secured to the ballast cover of the existing
    light fixture. See MBO Labs., Inc. v. Becton, Dickinson &
    Co., 474 F.3d 1323, 1329 (Fed. Cir. 2007) (“The words of
    patent claims have the meaning and scope with which
    they are used in the specification and the prosecution
    history.”).

    Judge Reyna also noted:


    The majority’s construction thus opens the door for
    the ’747 patent to be subsequently invalidated for failure
    to satisfy the written description requirement. Stated
    differently, the majority’s construction is a route towards
    rendering the patent invalid. See Carman Indus., Inc. v.
    Wahl, 724 F.2d 932, 937 (Fed. Cir. 1983) (“Claims should
    be so construed, if possible, as to sustain their validity. If
    such a construction would result in invalidity of the
    claims, the appropriate legal conclusion is one of noninfringement,
    not invalidity.”). The majority likewise
    invites an enablement challenge; under the majority’s
    approach, the retrofit aspect of the invention is merely an
    afterthought, one for which a skilled artisan must figure
    out for themselves the means by which the retrofit function
    of the invention shall be achieved, without any guidance
    from the patent. See Maj. Op. at 9. This result is
    absurd, given that when the patent is read as a whole,
    such guidance is clearly provided.
    Worse still, because the majority’s construction “does
    not recite how the lighting apparatus is installed into an
    existing light fixture,” id., the majority effectively reads
    the retrofit function out of claim 12 and claim 29, the
    retrofitting method claim. Claim 29, while not at issue in
    this case, is instructive. See Phillips v. AWH Corp., 415
    F.3d 1303, 1314 (Fed. Cir. 2005) (en banc) (“Because claim
    terms are normally used consistently throughout the
    patent, the usage of a term in one claim can often illuminate
    the meaning of the same term in other claims.”).
    Claim 29 contains the same “attachment surface” limitation
    at issue in claim 12:

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  • (Video) Europe’s Innovation Renaissance, China’s ‘Astonishing’ Rise: Global Innovation Index 2018

    European countries led by Switzerland are experiencing an “innovation renaissance,” this year’s Global Innovation Index shows, while the scale of China’s rise in the index is “quite astonishing,” Sacha Wunsch-Vincent, senior economic officer at the World Intellectual Property Organization, says in a short video interview with Intellectual Property Watch.

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  • Akeso Health Sciences, LLC v. Designs for Health, Inc. (C.D. Cal. 2018)

    Plaintiffs Litigation Position on Defendant’s Equitable Estoppel Defense Not Objectively Unreasonable By Donald Zuhn — Last month, in Akeso Health Sciences, LLC v. Designs for Health, Inc., District Judge S. James Otero of the U.S. District Court for the Central District of California denied a Motion for Exceptional Case Determination and Award of Attorneys’ Fees filed by Defendant Designs for Health, Inc. (“DFH”). In its Motion, DFH argued that the case should be deemed “exceptional” within the meaning of 35 U.S.C. § 285, and that DFH should therefore be awarded attorneys’ fees. Akeso had filed suit against DFH for infringement…

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  • 構成(名詞)

                            目次はこちら

    構成(名詞)

    (ARRANGEMENT)
    $$ The advantage of this arrangement is that it eliminates the need for the bracket like member (10) as proposed in the e…

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  • What do Generic Drug Patent Settlements Say about Patent Quality?

    An interesting study about Orange Book patents challenged both under Hatch-Waxman and Inter Partes Review caught my eye this week, but perhaps not for the ordinary reasons. One of the hot topics in drug patent challenges today is reverse payments: when the patentee pays the generic to stop a challenge. The Supreme Court has ruled that these payments can constitute antitrust violations. Though the drug companies give reasons, I’ll admit that I’ve always been skeptical of these types of payments.

    One of the key questions is whether the patent was going to survive. Most seem to assume that if a company pays to settle, then the patent was likely going to be invalidated. That’s where the draft, Maintaining the Balance: An Empirical Study on Inter Partes Review Outcomes of Orange Book-Listed Drug Patents and its Effect on Hatch-Waxman Litigation, by Tulip Mahaseth (a recent Northwestern Law grad) comes in. Here is the abstract from SSRN:

    The Hatch-Waxman Act intended to strike a delicate balance between encouraging pioneer drug innovation and promoting market entry of affordable generic versions of pioneer drugs by providing a streamlined pathway to challenge validity of Orange Book patents in federal district courts. In 2012, the America Invents Act introduced Inter Partes Review (IPR) proceedings which provide a faster, cheaper pathway to challenge Orange Book patents than Hatch-Waxman district court litigation. IPRs also have a lower evidentiary burden of proof and broader claim construction standard, which should make it easier, in theory, to obtain patent invalidation in IPRs as compared to Hatch-Waxman litigation. This empirical study on IPR outcomes of Orange Book patents in the past six years shows that both generic manufacturers and patent owners obtain more favorable final decisions in IPRs as compared to their Hatch-Waxman litigation outcomes because the rate of settlement in IPRs is much lower than in Hatch-Waxman litigation. Moreover, generic manufacturers do not appear to be targeting Orange Book patents in IPRs during their drug exclusivity period. Only 2 out of more than 400 IPRs against Orange Book patents were filed by generic petitioners during the patents’ New Chemical Entity exclusivity period. About 90% of the 230 Orange Book patents challenged in IPR proceedings were also challenged in Hatch-Waxman litigation. It is likely that generic manufacturers are not deterred from Hatch-Waxman litigation because of the lucrative 180-day exclusivity period, which gives the first generic filer 180 days to exclusively market their generic version without competition from other generics when the Orange Book drug patent is successfully invalidated in a subsequent district court proceeding. Therefore, IPR proceedings do not appear to be disrupting the delicate balance sought by the Hatch-Waxman Act. Instead, the IPR process has provided generic manufacturers a dual track option for challenging Orange Book patents by initiating Hatch-Waxman litigation in district courts and also pursuing patent invalidity in IPRs before the Patent Trial and Appeal Board, which has reduced rate of settlements resulting in more patents being upheld and invalidated.

    There’s a lot of great data in this paper, comparing Orange Book IPRs with non-Orange Book IPRs, including comparison of win rates and settlement rates.

    But I want to focus on one seemingly minor point: as the number of IPRs has increased, the rate of settlement has decreased. And, more important, the decreasing rate of settlement has led to more invalidation and more affirmance of patents.

    This result gives a nice window into how we might view settlements. Traditional Priest-Klein analysis says that this is exactly what we should see – that the previously settled cases were 50/50. But proving this is harder, and this data set would allow for a nice differences-in-differences analysis in future work.

    Additionally, a split among outcomes implies that the settlements were not necessarily because the patentee believed the patent was at risk.  If anti-competitive settlements were ruling the day, I would have predicted that most of the (recent) non-settlements would have resulted in patent invalidation. Then again, it is possible that a 50% chance was risky enough to merit a reverse payment settlement in the past. Regardless of how one comes out on this issue, this study provides some helpful details for the argument.

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  • Thirteen years since Phillips

    Wow, it has already been 13 years since Phillips was decided (July 12, 2005).  In Part IV-B of Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005), the en banc majority stated: While we have acknowledged the maxim that claims should be construed to preserve their validity, we have not applied that principle broadly, and […]

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  • The Indian Philips Case

    On Friday I mentioned Divij Joshi’s Spicy IP post on Koninklijke Philips Electronics N.V. vs. Rajesh Bansal And Ors., a case decided by the Delhi High Court last Thursday.  The court awarded Philips actual and punitive damages for the infringement of a patent that the court finds to be essential to the DVD Forum Standard, and that is one of many patents included in a patent pool.  Focusing exclusively on the damages issues, here are the principal takeaways as I see them:
    1.  If I understand correctly, it doesn’t appear that there is a FRAND commitment as such, but the court says that according to plaintiff’s counsel the pool royalty is determined on FRAND principles (para. 12.1).  Further, according to para. 13.1:
    Case of the plaintiff is that the license rates offered by the plaintiff vary according to the cooperation and conduct of the licensee. In case an entity procures the license of the plaintiff’s essential patent then it is required to pay as per the FRAND rate also referred to as compliant rate. However, if a party has chosen to infringe the patent of the other party then such licensees are required to pay a slightly higher royalty rate for the period  which it had not secured license for the plaintiff’s concerned essential patent which is referred to as standard rate. According to the plaintiff despite defendants having infringed the plaintiff’s patent, the plaintiff claims license fee only on FRAND terms i.e. at compliant rate. As per the evidence of PW-1 the running royalty rates upto 27th May, 2010 were 4.58 and 3.175 USD for standard rate and compliant rate respectively whereas after 28th May, 2010 it was 2.50 and 1.90 USD for standard rate and compliant rate respectively.
    The defendant, however, argues that these proposed rates are not FRAND:
    The main challenge of the defendants is that royalty rates are not in compliance with the FRAND terms. As noted in the options given by the plaintiff to the defendants vide its letter Ex.PW-1/7A the defendants had the option of either taking joint licenses or the PHILIPS ONLY licenses and despite infringement the plaintiff has sought royalty only at FRAND rates, that is, USD 3.175 upto 27th May, 2010 and thereafter USD 1.90 and for the PHILIPS ONLY option. Thus it is not a case where patents of the all other patentees were pooled with that of Philips which were used in DVD Video player (para. 13.7).
    If I’m understanding this correctly, then, the plaintiff proposed global royalty rates based on what it charges for the entirety of its pooled patents (rather than royalties just for the patent in suit), and the court adopts these proposed rates.  Whether the pool itself amounts to an abuse of dominant position would be an issue for, if anyone, the Competition Commission of India.  See para. 12.5 (“. . . whether creating of a patent pool by the bigwigs of the industry getting together amounts to an anticompetitive practice being misuse of the dominant position cannot be decided in the present suit.”).  The court also provides an extended excerpt from the U.S. Court of Appeals for the Federal Circuit’s opinion in CSIRO v. Cisco (see previous write-up on this blog here), I believe to show that it is permissible to use the entire market value of the end product as the base where this is consistent (as here) with the parties’ own prior negotiations.  (Use of the entire market value as the base is common with patent pools, to my knowledge.)  See paras. 13.9-13.10.
    On balance, I concur with Mr. Joshi’s assessment that this leaves a number of issues unresolved (though as he notes, the defendant offered no countervailing methodology).
    2.  On punitive damages, the court (para. 13.11) quotes at length from 207 (2014) DLT 713 Hindustan Unilever Ltd. vs. Reckitt Benckiser India Limited, as setting forth the principles to follow in deciding whether to award punitive damages.  (Neither Hindustran Unilever  nor the cited cases are themselves patent cases, however).  Here is a portion of the quoted material:
    “66. Rookes v. Barnard, [1964] 1 All ER 367, is the seminal authority of the House of Lords, on the issue of when punitive or exemplary (or sometimes alluded to as “aggravated”) damages can be granted. The House defined three categories of case in which such damages might be awarded. These are: 
    a. Oppressive, arbitrary or unconstitutional action any the servants of the government;

    b. Wrongful conduct by the defendant which has been calculated by him for himself which may well exceed the compensation payable to the claimant; and

    c. Any case where exemplary damages are authorised by the statute.

    The later decision in Cassell & Co. Ltd. v. Broome, 1972 AC 1027, upheld the categories for which exemplary damages could be awarded, but made important clarificatory observations. Those relevant for the present purpose are reproduced below:

    “A judge should first rule whether evidence exists which entitles a jury to find facts bringing a case within the relevant categories, and, if it does not, the question of exemplary damages should be withdrawn from the jury’s consideration. Even if it is not withdrawn from the jury, the judge’s task is not complete. He should remind the jury: (i) that the burden of proof rests on the plaintiff to establish the facts necessary to bring the case within the categories, (ii) That the mere fact that the case falls within the categories does not of itself entitle the jury to award damages purely exemplary in character. They can and should award nothing unless (iii) they are satisfied that the punitive or exemplary element is not sufficiently met within the figure which they have arrived at for the plaintiff’s solatium in the sense I have explained and (iv) that, in assessing the total sum which the defendant should pay, the total figure awarded should be in substitution for and not in addition to the smaller figure which would have been treated as adequate solatium, that is to say, should be a round sum larger than the latter and satisfying the jury’s idea of what the defendant ought to pay. (v) I would also deprecate, as did Lord Atkin in Ley v. Hamilton, 153 L.T 384 the use of the word “fine” in connection with the punitive or exemplary element in damages, where it is appropriate. Damages remain a civil, not a criminal, remedy, even where an exemplary award is appropriate, and juries should not be encouraged to lose sight of the fact that in making such an award they are putting money into a plaintiff’s pocket, and not contributing to the rates, or to the revenues of central government” (emphasis supplied) . . . .
    68. . . .  To award punitive damages, the courts should follow the categorization indicated in Rookes (supra) and further grant such damages only after being satisfied that the damages  awarded for the wrongdoing is inadequate in the circumstances, having regard to the three categories in Rookes and also following the five principles in Cassel. . . .
    The court then concludes, without further discussion, that an appropriate punitive damages award is ₹5 lakhs (para. 13.13), which as I mentioned on Friday comes to a little over $US 7,000.  I think Mr. Joshi may be right when he asserts in his post that “the Court reproduced at length the law on punitive damages, as established in Hindustan Unilever, and expounded on the importance of not being arbitrary in the award of damages, then immediately proceeded to award an arbitrary Rs. 5 Lakh in punitive damages without taking into account any of the principles reproduced by it.”

    3.  Finally, no injunction is granted because the patent has now expired.

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  • Legislation Introduced in House to Repeal the PTAB and the AIA

    There are 13 sections to Massie’s bill, many of which are geared towards the abolition of various statutes of the AIA. Perhaps the most salient portion of the proposed bill are sections regarding the abolishment of the Patent Trial and Appeal Board (PTAB) as well as the elimination of both inter partes review (IPR) and post-grant review (PGR) proceedings currently conducted by the PTAB. As the bill states, both IPR and PGR proceedings “have harmed the progress of science and the useful arts by…

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  • Ranging Beyond The Written Description Requirement

    Practitioners with an international patent practice generally view the U.S. written description requirement as more liberal than similar requirements in other jurisdictions, especially the European Patent Office. That said, one of the first lessons I remember learning for the USPTO patent bar is how the written description requirement is applied to numerical values and ranges….… Continue reading this entry

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  • Patently-O Bits and Bytes by Juvan Bonni

    Patently-O Bits and Bytes by Juvan Bonni

    Recent Headlines in the IP World:

    • Jan Wolfe: Federal Circuit will not Rehear Apple Challenge to Wireless Data Patent (Source: Reuters)
    • Kirtika Suneja: India Raises Trade Deficit Issue with China at WTO (Source: The Economic Times)
    • Anatol Antonovici: American Express Awarded Blockchain Patent for Payment System (Source: Cryptovest)
    • Jan Wolfe: U.S. Court Denies Jazz Pharma Bid to Revive Narcolepsy Drug Patents (Source: Reuters)
    • Jason Silverstein: Walmart Patents Audio Surveillance Technology to Record Customers and Employees (Source: CBS)
    • Kevin Parrish: Microsoft Patent Paves Way for a Touch- and Smudge-Free Tablet Future (Source: Digital Trends)

    Commentary and Journal Articles:

    • Atty. Krista Cox: Would Kavanaugh Change The Outcome Of SCOTUS Intellectual Property Cases? (Source: Above the Law)
    • Dr. Zia Qureshi: Intellectual Property, not Intellectual Monopoly: Reforming the System (Source: The Daily Star)
    • Prof. Amy Adler: Why Art Does Not Need Copyright (Source: SSRN)
    • Jena McGregor: What Walmart’s Patent for Audio Surveillance Could Mean for its Workers (Source: The Seattle Times)

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    Continue reading Patently-O Bits and Bytes by Juvan Bonni at Patently-O.

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  • USPTO: Claim Construction in AIA Trials

    Claim construction continues to hold focus as the centerpiece of contested patent cases — both in court and in administrative AIA trials (primarily, Inter Partes Review proceedings) before the Patent Trial and Appeal Board (PTAB).  One element of current practice is that the USPTO applies a different standard for construing claims than do courts or the USITC in infringement litigation. (Compare Broadest Reasonable Interpretation with Phillips / Ordinary Meaning standards).

    One of PTO Director Iancu’s early initiatives has been to unify the standards.  That process began with a notice of proposed rulemaking with finalized rules coming later this fall.

    The USPTO has posted comments submitted on the proposed change — with over 350 submissions.  Although the bulk of submissions favor the change, a substantial number also argue that the BRI standard is an important aspect of IPR effectiveness — with the beneficial result of lowering consumer costs and improving access to medicines. It will take some time to review these comments.

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  • The Indian Philips Case

    On Friday I mentioned Divij Joshi’s Spicy IP post on Koninklijke Philips Electronics N.V. vs. Rajesh Bansal And Ors., a case decided by the Delhi High Court last Thursday.  The court awarded Philips actual and punitive damages for the infringement of a patent that the court finds to be essential to the DVD Forum Standard, and that is one of many patents included in a patent pool.  Focusing exclusively on the damages issues, here are the principal takeaways as I see them:
    1.  If I understand correctly, it doesn’t appear that there is a FRAND commitment as such, but the court says that according to plaintiff’s counsel the pool royalty is determined on FRAND principles (para. 12.1).  Further, according to para. 13.1:
    Case of the plaintiff is that the license rates offered by the plaintiff vary according to the cooperation and conduct of the licensee. In case an entity procures the license of the plaintiff’s essential patent then it is required to pay as per the FRAND rate also referred to as compliant rate. However, if a party has chosen to infringe the patent of the other party then such licensees are required to pay a slightly higher royalty rate for the period  which it had not secured license for the plaintiff’s concerned essential patent which is referred to as standard rate. According to the plaintiff despite defendants having infringed the plaintiff’s patent, the plaintiff claims license fee only on FRAND terms i.e. at compliant rate. As per the evidence of PW-1 the running royalty rates upto 27th May, 2010 were 4.58 and 3.175 USD for standard rate and compliant rate respectively whereas after 28th May, 2010 it was 2.50 and 1.90 USD for standard rate and compliant rate respectively.
    The defendant, however, argues that these proposed rates are not FRAND:
    The main challenge of the defendants is that royalty rates are not in compliance with the FRAND terms. As noted in the options given by the plaintiff to the defendants vide its letter Ex.PW-1/7A the defendants had the option of either taking joint licenses or the PHILIPS ONLY licenses and despite infringement the plaintiff has sought royalty only at FRAND rates, that is, USD 3.175 upto 27th May, 2010 and thereafter USD 1.90 and for the PHILIPS ONLY option. Thus it is not a case where patents of the all other patentees were pooled with that of Philips which were used in DVD Video player (para. 13.7).
    If I’m understanding this correctly, then, the plaintiff proposed global royalty rates based on what it charges for the entirety of its pooled patents (rather than royalties just for the patent in suit), and the court adopts these proposed rates.  Whether the pool itself amounts to an abuse of dominant position would be an issue for, if anyone, the Competition Commission of India.  See para. 12.5 (“. . . whether creating of a patent pool by the bigwigs of the industry getting together amounts to an anticompetitive practice being misuse of the dominant position cannot be decided in the present suit.”).  The court also provides an extended excerpt from the U.S. Court of Appeals for the Federal Circuit’s opinion in CSIRO v. Cisco (see previous write-up on this blog here), I believe to show that it is permissible to use the entire market value of the end product as the base where this is consistent (as here) with the parties’ own prior negotiations.  (Use of the entire market value as the base is common with patent pools, to my knowledge.)  See paras. 13.9-13.10.
    On balance, I concur with Mr. Joshi’s assessment that this leaves a number of issues unresolved (though as he notes, the defendant offered no countervailing methodology).
    2.  On punitive damages, the court (para. 13.11) quotes at length from 207 (2014) DLT 713 Hindustan Unilever Ltd. vs. Reckitt Benckiser India Limited, as setting forth the principles to follow in deciding whether to award punitive damages.  (Neither Hindustran Unilever  nor the cited cases are themselves patent cases, however).  Here is a portion of the quoted material:
    “66. Rookes v. Barnard, [1964] 1 All ER 367, is the seminal authority of the House of Lords, on the issue of when punitive or exemplary (or sometimes alluded to as “aggravated”) damages can be granted. The House defined three categories of case in which such damages might be awarded. These are: 
    a. Oppressive, arbitrary or unconstitutional action any the servants of the government;

    b. Wrongful conduct by the defendant which has been calculated by him for himself which may well exceed the compensation payable to the claimant; and

    c. Any case where exemplary damages are authorised by the statute.

    The later decision in Cassell & Co. Ltd. v. Broome, 1972 AC 1027, upheld the categories for which exemplary damages could be awarded, but made important clarificatory observations. Those relevant for the present purpose are reproduced below:

    “A judge should first rule whether evidence exists which entitles a jury to find facts bringing a case within the relevant categories, and, if it does not, the question of exemplary damages should be withdrawn from the jury’s consideration. Even if it is not withdrawn from the jury, the judge’s task is not complete. He should remind the jury: (i) that the burden of proof rests on the plaintiff to establish the facts necessary to bring the case within the categories, (ii) That the mere fact that the case falls within the categories does not of itself entitle the jury to award damages purely exemplary in character. They can and should award nothing unless (iii) they are satisfied that the punitive or exemplary element is not sufficiently met within the figure which they have arrived at for the plaintiff’s solatium in the sense I have explained and (iv) that, in assessing the total sum which the defendant should pay, the total figure awarded should be in substitution for and not in addition to the smaller figure which would have been treated as adequate solatium, that is to say, should be a round sum larger than the latter and satisfying the jury’s idea of what the defendant ought to pay. (v) I would also deprecate, as did Lord Atkin in Ley v. Hamilton, 153 L.T 384 the use of the word “fine” in connection with the punitive or exemplary element in damages, where it is appropriate. Damages remain a civil, not a criminal, remedy, even where an exemplary award is appropriate, and juries should not be encouraged to lose sight of the fact that in making such an award they are putting money into a plaintiff’s pocket, and not contributing to the rates, or to the revenues of central government” (emphasis supplied) . . . .
    68. . . .  To award punitive damages, the courts should follow the categorization indicated in Rookes (supra) and further grant such damages only after being satisfied that the damages  awarded for the wrongdoing is inadequate in the circumstances, having regard to the three categories in Rookes and also following the five principles in Cassel. . . .
    The court then concludes, without further discussion, that an appropriate punitive damages award is ₹5 lakhs (para. 13.13), which as I mentioned on Friday comes to a little over $US 7,000.  I think Mr. Joshi may be right when he asserts in his post that “the Court reproduced at length the law on punitive damages, as established in Hindustan Unilever, and expounded on the importance of not being arbitrary in the award of damages, then immediately proceeded to award an arbitrary Rs. 5 Lakh in punitive damages without taking into account any of the principles reproduced by it.”

    3.  Finally, no injunction is granted because the patent has now expired.

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  • Jazz Pharms: Federal Register; Public Notice; and Printed Publications

    Jazz Pharms., Inc. v. Amneal Pharms., Inc., — F.3d —, 2018 U.S. App. LEXIS 19268 (Fed. Cir. 2018)

    The patented invention at issue in Jazz Pharms is not a drug or drug treatment, but rather to a “drug distribution system for tracking prescriptions” for drugs with a risk of abuse[1]  The PTAB found claims from all six patents to be invalid as obvious.

    The core issue on appeal was whether a pre-filing disclosure by Jazz counted as a prior art “printed publication.”

    Printed Publication: As the language suggests, a “printed publication” must be both “printed” and also a “publication.”  These requirements though have been broadly construed.  “Printed” publications go well beyond physical hard-copies to allow for various media – including video and online forms.  To be a “publication,” the reference needs to be made sufficiently available to the public – publication.  In the leading case of In re Hall,[2] the Federal Circuit explained that accessibility to the relevant public is key – we ask “whether interested members of the relevant public could obtain the information if they wanted to.”  Although the court has developed a number of guide posts, the question of sufficient availability is seen as a factual inquiry handled on a case-by-case basis.

    Continue reading Jazz Pharms: Federal Register; Public Notice; and Printed Publications at Patently-O.

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