• Better Cyber Security Problematic, Says US Financial Industry: Power Struggle Over Encryption

    A decision to keep third party listeners out of communications on the internet taken by the Internet Engineering Task Force (IETF) at their recent meeting in London elicited an alarmist message from the US financial industry. The premier internet standardisation body would provide “privacy for crooks,” and practically prohibit “bank security guards from patrolling and checking particular rooms” online, BITS, the technology division of the Financial Services Roundtable, argued in a press release last week. Has standardisation gone rogue?

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  • Patent Damages and Extraterritoriality

    In January the U.S. Supreme Court granted cert in WesternGeco LLC v. ION Geophysical Corp., No. 16-1011.  As I’ve previously noted on this blog: 
    The question presented is “Whether the U.S. Court of Appeals for the Federal Circuit erred in holding that lost profits arising from prohibited combinations occurring outside of the United States are categorically unavailable in cases where patent infringement is proven under 35 U.S.C. § 271(f).”  Readers may be familiar with the underlying case, which I have blogged about before (see here, here, and here).  For background, section 271(f) of the Patent Act reads as follows: 
    (1) Whoever without authority supplies or causes to be supplied in or from the United States all or a substantial portion of the components of a patented invention, where such components are uncombined in whole or in part, in such manner as to actively induce the combination of such components outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer. 
    (2) Whoever without authority supplies or causes to be supplied in or from the United States any component of a patented invention that is especially made or especially adapted for use in the invention and not a staple article or commodity of commerce suitable for substantial noninfringing use, where such component is uncombined in whole or in part, knowing that such component is so made or adapted and intending that such component will be combined outside of the United States in a manner that would infringe the patent if such combination occurred within the United States, shall be liable as an infringer.
    The defendant in this case was found liable under section 271(f), based on evidence that it supplied components of the invention from the U.S. to foreign customers, who then assembled them and performed marine seismic surveys for customers on the high seas.  The patent owner argues that, but for the infringement, it would have carried out those surveys and earned the resulting profit.  The Federal Circuit concluded, however, that the patent owner may not recover damages for lost profits arising from services it would have been performed outside the U.S., even if the evidence indicates that, but for the unlawful conduct that occurred within the U.S. (the supplying of the components), it would have performed those services.  Judge Wallach dissented.  (For more details, read my earlier posts.)
    The petitioner’s brief and several of the amicus briefs can now be accessed on Scotus Blog (here).  The respondent’s brief was filed on March 26 and is available on Westlaw (and presumably will be up on Scotus Blog, along with some other briefs, before too long).  There’s also a good summary of the briefs filed as of March 5 on Patenty-O, here, and another one today summarizing the respondent’s brief and two amicus briefs filed on the respondent’s behalf.
    The specific issue presented in WesternGecois somewhat narrow (section 271(f) doesn’t come up all that often), but the case raises broader questions that are becoming more and more common, both in the U.S. (see, e.g., Power Integrations and Carnegie-Mellon v. Marvell) and elsewhere (e.g., Canada, see here).  For the most part, patents (and other IP rights) throughout the world are territorial in nature:  a U.S. patent, for example, can be asserted against conduct that occurs in the U.S.; but the manufacture, use, or sale of products falling within the scope of the patent’s claims would be actionable in, say, Canada, only if the inventor has a corresponding Canadian patent (and vice versa).  But what if the infringing conduct occurring within the U.S. caused the patent owner to suffer some harm (for example, additional lost sales or lost royalties) outside the U.S.?  Is it permissible to recover damages for extraterritorial losses that were caused-in-fact and proximately caused by the U.S. infringement? Or would such a recovery undermine the principle that U.S. patent law does not apply extraterritorially, or interfere with other countries’ regulation of or public policies regarding the conduct at issue, or potentially result in duplicative recoveries?  Does this sort of situation raise a conflict of laws issue, or a comity issue, or something else?
    After giving the matter a great deal of thought over the past few years, I think I’ve finally come around to the view that courts should award any damages that are caused-in-fact and proximately caused by the infringement, regardless of whether the loss suffered occurred domestically or abroad; and that concerns over potential interferences with foreign law or policy are misplaced (though courts should be careful to avoid duplicative judgments).  My position on this question finally gelled after reading Professor Yelderman’s amicus brief, which makes the straightforward point that if my wrongful act causes your factory in the U.S. to shut down, which in turn causes you to suffer a foreseeable loss of profits on sales you would have made in the U.S. and abroad, general principles of tort law (cause in fact, proximate cause) would allow you to recover full compensation for those lost profits, including the lost profits attributable to the lost foreign sales.  That seems uncontroversial to me.  That said, what’s different about patents and other IP rights is that sometimes the losses resulting from an act of domestic infringement would also, potentially, be remediable in another country.  Suppose, for example, that my domestic act of patent infringement foreseeably causes you to lose x number of sales in Asia (as was alleged in Carnegie-Mellon).  It’s conceivable that the sales my competitor made in Asia could themselves infringe my counterpart Asian patents.  So then we have a risk of duplicative recoveries, or recoveries that exceed the parameters of what would be available in, say, Japan (punitive damages), etc.  On the other hand, I may not have any corresponding Asian patents, either because I didn’t seek any or because I didn’t succeed in obtaining them.

    Anyway, it seems to me that duplicative recoveries are a bad idea, but that that risk can be managed.  Suppose again that an act in country A causes a loss in country B. If the loss in country B has already been the subject of a lawsuit in country B, resulting in a judgment for the plaintiff, any damages recovered in country A should be reduced by the amount of damages recovered in country B.  I don’t see why damages in country A should be zero, though, if for some reason country A awards more generous recoveries than country B (punitive damages, disgorgement).  Alternatively, if the lawsuit in country B resulted in a judgment for the defendant–or was never and will never be filed in country B, because the owner doesn’t have or can’t get a corresponding IP right there–that just means that the act didn’t infringe in country B, but the sales themselves could still be foreseeable losses resulting from the infringement in country A.  This seems analogous to me to a “false conflict” in conflict of laws terminology.  On the other hand, what if the loss in country B is potentially remediable there but the first lawsuit is in country A?  Again, I’d say let country A award full damages, but I would hope that B wouldn’t impose duplicative damages in some future lawsuit involving the same conduct in B. 

    To put it another way, it seems to me that (within reason) country A should be able to decide for itself what sort of activity occurring within its own borders violates A’s laws, and what the consequences should be.  If the conduct occurring in A causes the patentee to lose sales that would have been made in B, and A thinks those losses should be compensated in accordance with whatever rules A normally applies to remedy acts of infringement occurring within A, I don’t see how that interferes with B’s sovereignty.  What makes it seem like a potential interference is that the sales that occurred in B (displacing sales the patentee otherwise would have made) might infringe patent rights in B.  But that is fortuitous.  The only way A would be interfering with B would be if A penalized the infringement occurring in B as such, that is, if it were purporting to penalize conduct, in B, infringing a B-issued patent.  At least the traditional policies in favor of territoriality would counsel against A doing that.  But to the extent A is simply providing a remedy for misconduct occurring in A, I don’t see a problem–unless B awards a remedy for the infringement of the patent in B that duplicates the remedy provided in A (e.g., they both award lost profits for the same lost sales in B; or A awards a lost royalty on the lost sales in B, while B awards disgorgement without reducing the award by the amount of the lost royalty). 
    At bottom, awarding the full measure of damages implies no disrespect of other countries’ laws.  Each country can decide as it sees fit how to remedy wrongful acts occurring within its borders. The only limitation would be to ensure that the same act doesn’t get penalized twice.  So if country A awards the disgorgement of profits earned in country B, country B shouldn’t award lost profits or disgorgement on top of that for the same acts.  But the interference with sovereignty issue as a red herring.  
    I’d also note that proving the domestic act of infringement proximately caused the loss suffered in a foreign country is hardly a walk in the park–those consequences may well be too remote and unforeseeable in a given case.  Thus, I tend to view some of the concerns expressed  in, for example, the respondent’s brief, as overblown.  (See, e.g., pp. 49-50, arguing that “Creating a prototype of any product in the United States would give rise to uncontrollable liability for downstream activities by unrelated foreign actors that occur entirely abroad.”  I don’t think that necessarily follows.)  Moreover, as the Yelderman brief suggests, in some cases moving production to a country where there are no corresponding IP rights could have been the domestic infringer’s next-best available noninfringing alternative, thus potentially reducing the damages it owes to zero. 

    Of course, I could still be wrong, and I’d welcome comments.

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  • Does Apple’s Move Away from Intel as Chip Supplier Signal Future Infringement Battles?

    Intel is not the only chipmaker feeling the pinch from Apple’s decision to move away from third-party vendors for its device components. Reports from last November indicated that Apple was also planning on developing its own power management chips for use in its iPhone products… News reports have indicated that Apple has poached engineering talent from firms like Imagination and Qualcomm, including the former head of Qualcomm’s core communications chip business, in recent years. While many…

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  • "Reduction to practice" discussed in Raytheon v. Sony


    Significantly, an inventor’s testimony alone is insufficient
    to establish an earlier reduction to practice. Medichem,
    437 F.3d at 1169–71. Instead, a party seeking to
    prove an actual reduction to practice must proffer evidence
    corroborating that testimony. Id. at 1170. “Sufficiency
    of corroboration is determined by using a ‘rule of
    reason’ analysis, under which all pertinent evidence is
    examined when determining the credibility of an inventor’s
    testimony.” Id.; Cooper, 154 F.3d at 1330. Whether
    a patentee reduced its invention to practice is a mixed
    question of law and fact. REG Synthetic Fuels, LLC v.
    Neste Oil Oyj, 841 F.3d 954, 958 (Fed. Cir. 2016); Steed,
    802 F.3d at 1318–20; Cooper, 154 F.3d at 1327. We
    review the Board’s legal conclusions de novo and its
    underlying factual findings for substantial evidence.
    REG, 841 F.3d at 958; Steed, 802 F.3d at 1318–20;
    Cooper, 154 F.3d at 1327.

    Much of the parties’ briefing and supporting evidence
    related to Raytheon’s reduction to practice contention are
    designated confidential. Accordingly, we do not describe
    these documents in detail here. For purposes of our
    analysis, it is sufficient to address Raytheon’s arguments
    at a high level of generality. During the IPR proceedings,
    the inventors testified that they reduced to practice the
    subject matter recited in the claims by the end of 1990—
    more than nine months before Bertin’s September 1991
    filing date—while working on a project for their employer
    and original assignee, Hughes Aircraft Company

    Of note


    We reject, moreover, Raytheon’s legal arguments as to
    why the Board erred. First, Raytheon argues that the
    Board erred by requiring every point of the reduction to
    practice be disclosed in the corroborating evidence, which
    Raytheon contends is inconsistent with the rule of reason
    standard. Raytheon is correct that corroborating evidence
    need not disclose each and every aspect of the claimed
    invention. See Cooper, 154 F.3d at 1331 (“[T]he law does
    not impose an impossible standard of independence on
    corroborative evidence by requiring that every point of a
    reduction to practice be corroborated by evidence having a
    source totally independent of the inventor[.]” (internal
    quotation marks omitted)); see also Fleming v. Escort Inc.,
    774 F.3d 1371, 1377 (Fed. Cir. 2014). But the Board did
    not require such proof here. As described above, the
    Board determined that the corroborating evidence contradicted
    the inventor’s testimony and therefore could not be
    sufficiently corroborative. This conclusion is reasonable
    in view of the evidence. Cf. Woodland Tr. v. Flowertree
    Nursery, Inc., 148 F.3d 1368, 1371 (Fed. Cir. 1998) (explaining
    that, in evaluating the rule of reason, courts take
    into account “contradiction or impeachment of the witness’
    testimony”).

    Footnote 3 refers to an invention disclosure:


    Before the Board, Raytheon also relied on an
    August 1990 invention disclosure and a November 1990
    white paper. On appeal, however, Raytheon disclaims
    reliance on those documents. See Appellant Br. 15 n.8;
    Oral Argument at 12:28–13:35, Raytheon Co. v. Sony
    Corp. (No. 2017-1554), http://oralarguments.cafc.uscourts.
    gov/default.aspx?fl=2017-1554.mp3 (“[W]e limited the
    scope of the evidence that we’re relying upon.”).

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  • The Abuse of Orange Book Listings by Branded Pharmaceutical Companies

    AbbVie’s maneuver worked like clockwork to induce regulatory gridlock, which prevented generic competition and kept the company’s profits high at public expense, for years. Fortunately, the FTC would have none of it. The agency filed suit against AbbVie in the Eastern District of Pennsylvania in 2014, accusing the company of illegal monopolization under the antitrust laws. The gravamen of the FTC’s complaint was that AbbVie wrongfully filed objectively-baseless sham litigations, to block…

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  • The Abuse of Orange Book Listings by Branded Pharmaceutical Companies

    AbbVie’s maneuver worked like clockwork to induce regulatory gridlock, which prevented generic competition and kept the company’s profits high at public expense, for years. Fortunately, the FTC would have none of it. The agency filed suit against AbbVie in the Eastern District of Pennsylvania in 2014, accusing the company of illegal monopolization under the antitrust laws. The gravamen of the FTC’s complaint was that AbbVie wrongfully filed objectively-baseless sham litigations, to block…

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  • "Edisons" of Pennsylvania

    The feature article of the March/April 2018 issue of CelebrateGettysburg is Meet the Original Inventive Minds of Adams County which observed that


    In Adams County, the first patent application was filed by Abraham Weaver in April 1807. His patent declared he had a new design for distilling whiskey. Likewise, Antonie Boucherie in 1809 took up the thread of distillation and filed a patent for making cordials and gin liquors from sugar and molasses, a process that involved intricate copper tubing, kettles, and a cooling tub.

    There was a reference to the “Edison of Adams County”:


    But by far the most prolific inventor was George W. Palmer of Littlestown. Palmer would qualify as the Edison of Adams County. In his time, Palmer invented a bone meal grinder for fertilizer, a plate connector used by every railroad in America, a water lifting pump, the adjustable double-flanged railroad car wheel, and a chemical process of treating and preserving telegraph, telephone, and railroad timbers.

    Outside the scope of the article would be the “Edison of Cumberland County,” Daniel Drawbaugh, described in Wikipedia:


    Described as a bearded rustic tinkerer from Yellow Breeches Creek, Pennsylvania, he claimed to have invented a telephone using a teacup as a transmitter as early as 1867, but had been too poor to patent it then. In a lower court his case was well-financed by the People’s Telephone Co. and brilliantly argued in court by Lysander Hill. But he “blew it” by drawling in court “I don’t remember how I came to it. I had been experimenting in that direction. I don’t remember of getting at it by accident either. I don’t remember of anyone talking to me of it.” The lower court findings were confirmed by the Supreme Court in 1888, as noted in The Telephone Cases.

    See also

    https://www.newspapers.com/newspage/9349215/

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  • Do past events predict future outcomes: Robertson pitching to Smoak on April 1, 2018.

    In March 2018, IPBiz had a post titled The significance of the finding “patents with higher reverse citation counts are less likely to survive review “? which questioned the significance of the correlation between “many citations to earlier work in a patent” and the probability that PTAB would decide to institute a review of that patent. The authors of the study observed:


    While one might expect institution to be negatively correlated with counts of such citations—e.g., on the theory that more diligent applicants and examiners will tend to find and review more prior art224—we actually find the opposite. We observe that never-instituted patents cited fewer pieces of prior art overall, had fewer prior art citations added by the examiner, and cited to fewer pieces of nonpatent prior.

    But, correlation does not necessarily imply causation. Separately, as to using this result as a “guide” to predict future outcomes, some recent results in spring 2018 baseball are worth noting.

    One game in question was the Yankees fourth of 2018, played on April 1. Sportsnet gives the background:


    Leading 5-4 in the eighth inning, [Yankees manager] Boone ordered an intentional pass to Donaldson to load the bases [for Robertson to face Smoak] in an inning that began with a Russell Martin single and seemed destined to dry up when Devon Travis tapped out to the mound with two on for the second out of the inning.

    (…)

    Smoak was 0-for-5 with four strikeouts lifetime against Robertson. Donaldson was 3-for-8 with two home runs. But Smoak had homered in his previous at bat against right-hander reliever Tommy Kahnle, had singled before that, and was 3-for-4 with a double on Saturday. Donaldson was 2-for-13 with two walks and had been plagued in spring training by shoulder and leg issues.

    (…)

    Boone said that the matchup was something that had been pre-determined in staff meetings; that “we were kind of going with ‘Who do we like against each guy?’ It’s as simple as that.”

    Asked whether he believed past or recent history was more important when dealing with admittedly small sample sizes, Boone said recent history matters less than many may think.

    (…)

    “We tried to match up skill set versus skill set,” he continued. “We liked his (Robertson’s) breaking ball better (against Smoak.)”

    But the home run hit by Smoak was not off of a curve ball:


    Smoak blasted his grand slam on the ninth pitch of the at bat, a 93 miles per hour four-seam fastball that was thrown after back to back curveballs, two of the six thrown by Robertson. The Yankees pitcher walked toward home plate after Robertson spoiled the eighth pitch, shaking his head and grinning as he accepted a new ball from home plate umpire David Rackley.

    “He just kept fouling them off and was on me and I thought I could get a fastball by him,” said Robertson. “I didn’t want to throw him another curveball he’d already seen a lot of them. I thought it was the best I had at the time. I got him out a lot in the past but he got me today.

    “It was frustrating, because I was one pitch away. He found a way to put a piece of the bat (on the curves) and stay with it.

    The SportsNet story also discussed a similar strategic backfire of Phillies manager Gabe Kapler.

    In passing, the at-bat of Smoak can be compared to the famous confrontation between Adam Wainwright and Carlos Beltran in Game 7 of Mets/Cardinals in 2006. See the IPBiz post
    Patent Law Confuses Application with Invention?

    Also, in passing, from blawgsearch on 4 April 2018:

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  • IP Lawyer Daniel Miller Joins Kasowitz

    Daniel Miller has joined Kasowitz Benson Torres LLP as Special Counsel in the firm’s Intellectual Property Litigation group; he will be based in the firm’s Washington, DC office.

    The post IP Lawyer Daniel Miller Joins Kasowitz appeared first on IPWatchdog.com | Patents & Patent Law.

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  • Supreme Court: Two Patent Cases This Term.

    by Dennis Crouch The Supreme Court patent docket is light this year – at least in terms of granted petitions.  We all await the outcome of Oil States. Conventional wisdom is that the case will be a dud and that the Supreme Court confirm the viability of Inter Partes Review proceedings.  Still, the case is fascinating […]

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  • 側(がわ) ~する側;~される側

                            目次はこちら

    側(がわ) ~する側;~される側

    –>上側/下側/右側/左側

    $$ Note that whereas the first carrier part lies around the variator axis, the carrier block 146 lies to one side of the axis. / 第1のキャリヤ部分は変動器軸線のまわりに位置するが、キャリヤブロック146は軸線の片側に位置することに留意されたい。(USP7637841): one side

    $$ The first loaded basket drops down the column 58 and is supported above a series of baffles 59 at the lower end of the column 58. / 最初に供給されたバスケットは、列58を下降し、列58の下端にある一連のバッフル59の上側に支持される。(USP7622140): above

    $$ In FIGS. 14 and 15 the exhaust duct can be mounted on the same side of the roller assembly as the inlet duct. / 図14および15において、ローラ組立品の導入ダクトと同じ側に排出ダクトを装着することができる。(USP7581284): same side

    $$ Additionally, each antenna 3 has mounted across its aperture a retroreflector 6 which is reflective to radiation at optical wavelengths. / 加えて、各アンテナ3はそのアパーチャの向こう側に、光学波長の放射を反射する再帰反射体6を搭載している。(USP7579596): across

    $$ The panel 232 is connected to the base portion 212 via two hinges 233, one at either side of the panel 232. / 板232は、2つのヒンジ233(その一つは、板232のいずれか一方側にある)により、ベース部212に接続される。(USP7575279): either side

    $$ The motion of this compressing body displaces fluid against the higher fluid pressure on the outlet side, thereby doing work on the fluid as it does so. / この押圧固体の運動は、流体を出口側における前記高流体圧に抗して変位させ、これにより、斯様に変位させる際に該流体に対して仕事をする。(USP7284962): outlet side

    $$ Specifically, at a swathe edge more drying occurs on the unprinted side since the solvent concentration in the atmosphere above the substrate is less than the printed side. / 具体的には、スウォースの端部では、プリントされない側がより乾燥することになる。これは、基材上方の空気中の溶媒濃度がプリントされる側よりも少ないためである。(USP8084767): PP side

    $$ The tiles 47 are arranged to view an object passing through the portal, in this case a person 48 from a plurality of different sides. / タイル47は、門を通過する物体、この場合は個人48を複数の異なる側から見るように構成される。(USP8068049): different side

    $$ To turn the dog in the direction of the side of the dog to which the lead passes, the lead is pulled gently in that direction. / 上記犬を上記リードが通っている側の方向に向かせるためには、上記リードをその方向にやさしく引けばよい。(USP8051808): side…which

    $$ Recipient Allegiance–the side (if any) to which the recipient owes allegiance; / 受け手忠誠:受け手が忠誠を尽くす義務のある側(存在する場合)(USP8037105): side…which

    $$ In this arrangement, the fluid is pumped in the direction shown by arrow 16 from the open side 25 or region of lower hydrostatic pressure of the nozzle to the side 25 or region of higher hydrostatic pressure, on which the closure assembly is located. / この構成においては、流体は矢印16により示される方向に当該ノズルの開放側から上記閉鎖アセンブリが配置されている側へとポンプ送りされる。(USP7284962): side…which

    $$ The hose and wand assembly according to claim 8, wherein the gripping portion is located on the side of the longitudinal axis of the rigid pipe portion which is remote from the side from which the flexible hose portion extends. / 前記グリップ部が、前記可撓性ホース部が延在する側から遠くにある剛性パイプ部の長手軸線の側に位置決めされていることを特徴とする請求項8に記載のホース・ワンド・アセンブリ。(USP7000288): side…which

                            目次はこちら

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  • Oil States oral argument

    It looks like it will be a little less than two weeks before the Supreme Court issues any new opinions.  So, with Oil States on the verge of being decided, I thought it might be of interest to re-post the Oil States oral argument.  It is available below:   The transcript is available here: [TRANSCRIPT].

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