SCOTUS Watch: Oral Arguments in Oil States

On November 27, 2017, the U.S. Supreme Court heard oral arguments in the Oil States Energy Services, LLC v. Greene’s Energy Group, LLC.[1]  This case is discussed in a previous blog posting, but as a recap, the two parties in the litigation are both oil & gas companies, in which Oil States owned a patent for protecting wellheads during the oil fracking process.  Greene’s petitioned for inter partes review (IPR) before the PTAB, which invalidated Oil States’ patent.  Upon appeal, the Federal Circuit rejected Oil States’ arguments and affirmed the PTAB’s invalidation.  Upon grant of certiorari, Oil States argued that the IPR system acted to deprive it of its private property since patents, it argued, is private right and not a public right.

From the get-go, Justice Ginsburg, outlined her position clearly and succintly:

Ms. Ho [Oil States counsel], you outlined your position, but there must be some means by which the Patent Office can correct the errors that it’s made, like missing prior art that would be preclusive.[2]

Justice Ginsburg’s exchange with Allyson Ho discussed the ex parte and inter partes reexamination processes, in which Ho argued there was a fundamental difference between examinational and adjudicational processes, where examinational were allowed under Article III but adjudicational would not.

Justice Kagan interjected with inter partes reexamination, and Ho responded:

I think inter partes reexamination presents a closer case, but it is still fundamentally examinational.[3]

Both Justices Ginsburg and Kagan, based on their questions, seemed inclined to retain the IPR system, as both were forceful in their inquiry about why the IPR system is unconstitutional.  Justice Kagan further opined:

It’s the government trying to figure out whether it made a mistake by granting the patent, which the government sometimes does and knows it sometimes does, but the government wants to put in place a set of procedures that will actually increase the government’s accuracy in figuring out whether it made a mistake.

And that involves listening to a third party that has some interest in the proceeding.  So it seems a bit odd to say, sure, the government can reexamine this, the government can allow a third party to request it, can allow the third party to do some things, but there’s some line that falls short of what the government thinks of the procedures that enable the greatest accuracy.[4]

Justice Breyer also tipped his hand by saying:

. . . I thought it’s the most common thing in the world that agencies decide all kinds of matters through adjudicatory-type procedures often involving private parties.  So what’s special about this one, or do you want to say it isn’t special and all agency proceedings are unlawful?  Because a lot of them would fit the definition, I think, that you propose.[5]

And, when Ho tried to argue the rarity of administrative adjudications where the government was not acting in the position of “enforcer,” Justice Breyer countered:

. . . if the airlines loses your umbrella, for example, and the CAB used to say, you go to the CAB, you complain, they lost my umbrella.  The airline says, no, we didn’t.  Oh, that was unconstitutional?  . . . And, by the way, it didn’t say that your rights, when you fly on an airplane or truck or some other thing regulated, it didn’t say as it does here, subject to the provisions of this title, the matter, your umbrella, or in this case patents, shall be private property.  Uh-huh.  So you have a statute that says you only get the private property if, in fact, you survive the provisions of the title, of which this is one.[6]

Justice Sotomayor also mentioned, regarding the common law Privy Councils which was the historical predecessor of the PTAB:

. . . But in fact that it waned didn’t mean it was eliminated, and it didn’t mean that the Privy Council or the crown though that it no longer had those rights.[7]

And further inquired to Chris Kise, counsel for Greene’s Energy:

. . . I mean, for me, this – what saves this, even a patent invalidity finding, can be appealed to a court.  There’s deference with respect to factual matters, but there is de novo review as to legal matters.  So how can you argue the – the crown, the executive, the PTO, here has unfettered discretion to take away that which it’s granted?[8]

Justice Kennedy weighed in, questioning of Ho that the Patent Clause in the U.S. Constitution grants patents for “limited times”:

. . . [D]oesn’t that show that the patent owner has limited expectations as to the scope and the validity of the property right that he holds?[9]

However, Justice Kennedy also queried of Kise about the Patent Clause, and his argument that IPRs implicate a public purpose:

Securing for limited times authors and inventors the exclusive right, securing to them, not to the [general public].[10]

It appears from his questioning that Justice Kennedy may be the swing vote, as usual.

On the other side, Chief Justice Roberts and Justice Gorsuch vehemently argued that issued patents were private property and generally antagonistic about IPRs.  Chief Justice Roberts noted to Kise:

. . . it strikes me, is simply that you’ve got to take the bitter with the sweet.  If you want the sweet of having a patent, you’ve got to take the bitter that the government might reevaluate it at some subsequent point . . . [H]aven’t our cases rejected that . . . proposition?  We’ve said you . . . cannot put someone in that position.  You cannot say, if you take public employment, we can terminate you in a way that’s inconsistent with due process. [11]

Chief Justice Roberts made this point when Kise tried to argue that Congressional authority gave the USPTO the almost absolute authority to determine the outer limits of patent protection.

Justice Gorsuch tried to make the analogy to land patents (that is, property is deeded by the sovereign (e.g., U.S. government) to a private entity, and it is published for all the world to know) to argue his point that invention patents are private property, by stating:

Do you think it would work if  — if we had land patents subject to the same circumstances, that they could be reexamined at any time over hundreds of years, even after the farmer had sold the land to the developer who built the houses and that the land patent could be revoked by the government by bureaucracy . . . [which amounts to ] [a] monopoly in the use of land.  What’s – what’s the difference between – operative difference, other than obviously one isn’t land?[12]

Needless to say, it was a rather clumsy attempt to equate Fuji apples to Granny Smith apples.

Justice Alito spoke very little, except to pointedly query the historical aspects of whether a patent right was a private right.[13]  All three would appear to be a part of a very rambunctious minority opinion. [14]

The session ended after an hour of arguments.

I do not believe the Court will find IPRs unconstitutional, partly because the Court has already found IPRs, at least in dicta, to be valid extensions of the executive branch, proper delegations by the legislative branch, and therefore, constitutional.  In the recently-decided Cuozzo case, the Count found:

Although Congress changed the name from “reexamination” to “review,” nothing convinces us that, in doing so, Congress wanted to change its basic purposes, namely, to reexamine an earlier agency decision.  Thus, in addition to helping resolve concrete patent-related disputes among parties, inter partes review helps protec the public’s “paramount interest in seeing that patent monopolies . . . are kept within their legitimate scope.”  (citations omitted.)[15]

Coupled with the questioning from the justices, it seems unlikely that the PTAB “death squads” will meet their end.  Rather, there may be some tweaking of the IPR system.  After all, it has worked very well in controlling the patent trolls which was the original aim when the IPR system was started in the AIA.  However, the system may have worked too well.  All new legislation must be tweaked to improve its process.  Five years after its enactment, it may well be time for the IPR process to make some fine-tuning changes.

A decision should be rendered by June 2018.

[1] 639 Fed. App’x 639 (Fed. Cir. 2016), cert. granted, 198 L. Ed. 2d 677 (U.S. Jun. 12, 2017) (No. 16-712).

[2] Oral arguments at 3-4, Oil States Energy Services, LLC v. Greene’s Energy Group, LLC, 198 L. Ed. 2d 677 (2017) (No. 16-712).

[3] Id. at 5.

[4] Id. at 21-22.

[5] Id. at 20-21.

[6] Id. at 19-20.

[7] Id. at 26.

[8] Id. at 34.

[9] Id. at 11.

[10] Id. at 38-39.

[11] Id. at 32.

[12] Id. at 36-37.

[13] Id. at 24-25.

[14] No discussion is made on Justice Thomas’ comments, only because, characteristically, he does not usually say anything during oral arguments, although given his jurisprudential ideology, it would be logical to conclude that he would side with C.J. Roberts and Justices Gorsuch and Alito on this case.

[15] Cuozzo Speed Technologies, LLC v. Lee, 579 U.S.___, 136 S.Ct. 890 (2016) (slip op. at 16).

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SCOTUS Watch: Oil States Oral Hearing Preview

On November 27, 2017, the U.S. Supreme Court will hear oral arguments in the appeal from the Court of Appeals for the Federal Circuit, Oil States Energy Services v. Greene’s Energy Group.[1]  Certiorari was granted earlier this year.  The sole question presented is whether the inter partes reviews – adversarial proceedings held before the United States Patent and Trademark Office’s Patent Trial and Appeal Board (PTAB) and enacted as part of the AIA in 2012 – violates the Seventh Amendment of the U.S. Constitution by terminating a private property right through a non-Article III forum without a jury.

Inter partes proceedings – collectively, inter partes reviews, post-grant reviews, covered business method reviews – and ex parte reexaminations have become important tools utilized by patent owners to combat overly broad issued patents owned by so-called “patent trolls.”  Inter partes proceedings, while expensive, are nothing compared to the costs of a full-blown litigation in the federal courts, which is part of the reason this mechanism has been popular since its enactment almost four years ago.

There is also a large vocal chorus on the other side which finds that inter partes proceedings and the PTAB’s entire post-grant challenge process to be a thorn in the side of strong patent rights.  The high challenge rate at the PTAB, as well as the high invalidity rate, were reasons for the U.S. to drop to tenth in the world in protection of IP rights.

The Federal Circuit already has long held that ex parte reexams do not violate Article III or the Seventh Amendment.[2]  After enactment of the AIA’s post-grant procedures in 2012, the Federal Circuit held the same for inter partes proceedings.[3]  However, neither case made its way to the Supreme Court until Oil States was granted certiorari.

If the Supreme Court finds that patents are, indeed, private property rights, and in doing so, reverses the Federal Circuit and hold inter partes reviews unconstitutional.  However, if it finds patents are public rights (i.e., being issued by a public agency for the betterment of the public as a whole), the Federal Circuit’s decision would be affirmed, and inter partes reviews found constitutional.  Perhaps a possible hint of how the Supreme Court might rule came in a recent trademark case, B&B Hardware, Inc. v. Hargis Indus.[4]  In the majority opinion, Justice Samuel Alito wrote:

The likely reason that Hargis did not directly advance a constitutional argument is that, at least as to a jury trial right, Hardis did not even list the Seventh Amendment as an authority in its appellee brief . . . . To the extent, if any, that there could be a meritorious constitutional objection, it is not before us.[5]

One interesting dicta is what another commentator[6] noted:

It would . . . be desirable if all [patent] cases of this sort could be referred to a commision of intelligent experts and practical men to report their opinion thereon, with their reasons, for the final action of the court . . . . Neither courts nor ordinary juries are perfectly adapted to the investigation of mechanical and scientific questions . . . .[7]

More information will follow after oral arguments.

[1] 639 Fed. App’x 639 (Fed. Cir. 2016), cert. granted, 198 L. Ed. 2d 677 (U.S. Jun. 12, 2017) (No. 16-712).

[2] See Patlex Corp. v. Mossinghoff, 758 F.2d 594, modif’d on rehearing, 771 F.2d 480 (Fed. Cir. 1985).

[3] See MCM Portfolio LLC v. Hewlett-Packard Co., 812 F.3d 1284 (Fed. Cir. 2015).

[4] 575 U.S___; 135 S. Ct. 1293 (2014).

[5] Id. at 1304.

[6] See Dennis Crouch, 1877 Supreme Court Thought’s on Oil States?, Patently-O Blog (Nov. 20, 2017), at https://patentlyo.com/patent/2017/11/supreme-thoughts-states.html.

[7] Quoting Cochrane v. Deener, 94 U.S. 780 (1877).

USPTO Finalizes New Patent Fee Schedule

On November 14, 2017, the USPTO issued its final rule on new fees for Fiscal Year 2017.[1]  There are some marked increases, several moderate increases, some nominal increases, a few new fees, and some fees which have been eliminated altogether.  The new fee schedule reflects a strategic goal for aligning fees to their associated costs for administration at the USPTO.

One set of significantly higher fees involves fees for inter partes reviews.  Rationale for the marked increase in the Patent Trial and Appeal Board (PTAB) proceeding fees are to align the USPTO costs of administering the PTAB trial processes with the AIA statutory requirements.  Specific fee increases include:

  • Inter Partes Review Request (up to 20 claims): $15,500, or a 72% increase.
  • Inter Partes Review Post-Institution Fee (up to 15 claims): $15,000, or a 7% increase.
  • Inter Partes Review Request, excess claims over 20: $300, or a 50% increase.
  • Inter Partes Post-Institution Request, excess claims over 15: $600, or a 50% increase.
  • Post-Grant or Covered Business Method Review Request: $22,000, or a 33% increase.
  • Post-Grant or Covered Business Method Review Post-Institution Fee: $22,000, or a 22% increase.
  • Post-Grant or Covered Business Method Review Request, excess claims over 20: $375, or a 50% increase.
  • Post-Grant or Covered Business Method Review Post-Institution Request, excess claims over 15: $825, or a 50% increase.

None of these higher fees have an adjustment for different entity sizes, so small and micro entities must pay the same amounts as large entitites.[2]

Another set of significantly high fees affects biotech applications, specifically those that file sequence listings.  New fees for mega-sequence listings between 300 and 800 MB of data are $1,000/$500/$250 at large entity/small entity/micro entity rates.  New fees for sequence listings over 800 MB of data are $10,000/$5,000/$2,500 at at large entity/small entity/micro entity rates.  The USPTO points out that the vast majority of sequence listings fall below the 300 MB threshold, and there are additional burdens on administrative storage and handling of sequence listings over 300 MB.[3]

Design and plant prosecution fees have also increased moderately.  Design search fees are up 33%, at $160/$80/$40 at large entity/small entity/micro entity rates, while design examination fees are up 11%, at $600/$300/$150 at large entity/small entity/micro entity rates.  Plant search fees are up 11%, at $420/$210/$105 at large entity/small entity/micro entity rates.  Finally, design issue fees are up 25%, at $700/$350/$175 at large entity/small entity/micro entity rates, while plant issue fees are up 5%, at $800/$400/$200 at large entity/small entity/micro entity rates.  Rationale for these moderate increases is a balance between maintaining a relatively stable fee structure for design and plant applications, while at the same time recovering USPTO costs for prosecution, especially given the fact designs and plants do not have to pay maintenance fees upon issuance.[4]  While the fees have increased, the overall effect on SMEs and startups should be minimal.

Information disclosure statements (IDSs) are not immune from fee increases.  Rationale for these new fees are meant to encourage earlier disclosure of IDSs in prosecution, complying with 1.97(b).  The increased fees for filing an IDS outside of 1.97(b) are $240/$120/$60 at large entity/small entity/micro entity rates.  This represents a 33% increase.[5]

A new fee for a petition for ex parte reexamination under §1.510 has been introduced.  The fees are $6,000/$3,000/$1,500 at large entity/small entity/micro entity rates.[6]

Office of Enrollment and Discipline (OED) fees have also increased between 100% – 300%.[7]

On the upside for SMEs and startups with limited budgets, new small entity and micro entity rates were established for the following:

  • Petition for Delayed Payment of Maintenance Fee: $1,000/$500, at small entity/micro entity rates.
  • Petition for Revival of an Abandoned Application: $1,000/$500, at small entity/micro entity rates.
  • Petition for Delayed Submission of a Priority Claim: $1,000/$500, at small entity/micro entity rates.
  • Hague International Design Application Transmittal Fee: $60/$30, at small entity/micro entity rates.[8]

The new patent fee schedule takes effect January 16, 2018.

[1] 82 Fed. Reg. 52780 (Nov. 14, 2017).

[2] Id. at 52790.

[3] Id. at 52787.

[4] Id. at 52787-88.

[5] Id. at 52788.

[6] Id. at 52789.

[7] Id. at 52791.

[8] Id. at 52793.

USPTO Issues Public Comments for §101 Subject Matter Eligibility

By Brent T. Yonehara

On July 30, 2017, the USPTO released its §101 report, Patent Eligible Subject Matter: Report on Views and Recommendations From the Public.   The report is a rather dry recitation of the §101 legal framework better suited for a Patent Bar Exam prep course.  However, there is an interesting comparative overlay of the patent subject matter eligibility requirements in other jurisdictions around the world, including China, the EPO, Japan, and Korea.

The public comments are rather straightforward, with some saying the Mayo/Alice restrictions on subject matter (PSM) eligibility, and especially the two-step test, are “overly broad” by “devaluing entire patent portfolios,”[1] and “unclear” by creating “unpredictability in the issuance and enforcement of patents.”[2]  Another common criticism of the PSM eligibility was that the Alice test stifles innovative activity and ultimately hurts U.S. businesses by tilting patent protection to large companies and away from startups where new innovations in software need patent protection the most.[3]

On the other hand, the new PSM regime had its supporters.  One supportive comment was that the new Alice regime weeded out overly broad patents, eliminating “low-quality patents” out of the patent ecosystem (i.e., preemption).[4]  Others lauded the new Alice regime as a powerful weapon against patent trolls.[5]  A further, and insightful, supporting comment was that foreign companies have a major stake in the U.S. patent system, and that Mayo/Alice is actually favored by these “geopolitical considerations.”  Along that same line, if a foreign inventor creating innovations overseas gets that patent protection in, say, Europe, but not here in the U.S. due to the Mayo/Alice regime, that innovation still exists; just the patent protection is not available for it on our shores.  This would have the benefit of lowering prices for U.S. consumers since lack of patent protection would open up markets to newer products, thus lowering prices.[6]

The Report ended with legislative recommendations for Congressional action, including proposed §101 amendments from the Intellectual Property Owners Association (IPOA) and the AIPLA.

(Disclaimer: the author is a member of the IPOA)

[1] See Patent Eligible Subject Matter: Report on Views and Recommendations From the Public (“Report”), United States Patent and Trademark Office, July 2017, at 29.

[2] Id. at 29-30.

[3] Id. at 32.

[4] Id. at 24.

[5] Id. at 25.

[6] Id. at 27.

 

Fed Circuit Watch: Litigation Misconduct and Inequitable Conduct

By Brent T. Yonehara

On July 27, 2017, the Court of Appeals for the Federal Circuit decided Regeneron Pharmaceuticals, Inc. v. Merus B.V.  In Regeneron, the Federal Circuit affirmed a district court’s finding that Regeneron’s patent 8,502,018 was unenforceable due to inequitable conduct.[1]  This case brings up the Therasense New Order of Inequitable Conduct in patent cases.

The law of inequitable conduct has slowly begun to take shape seven years after Therasense[2] was decided by the Federal Circuit.  In Therasense, the Federal Circuit enunciated the elements for determining an inequitable conduct defense.  First, there must be materiality.  Second, there must be intent to deceive the USPTO. [3]

To start with, the duty to disclose and deal in good faith with the USPTO in patent applications extends to the patent applicants, owners, inventors, and patent practitioners of the application.[4]  All of these individuals must disclose information material to patentability (emphasis added).[5]  A prima facie case of unpatentability is established when the information demonstrates that a claim is unpatentable under the preponderance of evidence, with each claim term given its broadest reasonable interpretation consistent with the specification.[6]  Also, information is not considered material if it is cumulative to information already of record.[7]

Further, these individuals must also have a specific intent to deceive the USPTO by failing to disclose information as to the patentability of the claim in question; this must be proved by a much higher clear and convincing evidence standard.[8]  While a direct intent is rarely proven, an inferred intent can be made from indirect and circumstantial evidence which must be the “single most reasonable inference able to be drawn from the evidence.”[9]

In Regeneron, the patent practitioners failed to disclose four prior art references cited by third parties in related U.S. and foreign prosecutions.  The Regeneron practitioners alleged that while the references withheld is not in dispute, the references themselves were merely cumulative of what was already in the file wrapper.  The subject matter of the ‘018 patent in question was the mouse-human chimera, or genetically modified mouse, for purposes of developing genetically modified mouse antibodies to be used in humans to combat certain bacteria or viruses.  Claim 1 recited:

  1. A genetically modified mouse, comprising in its germline human unrearranged variable region gene segments inserted at an endogenous mouse immunoglobulin locus.

Regeneron had argued that under the broadest reasonable interpretation, Claim 1 was limited to a reverse chimeric mouse.  In other words, Regeneron argued for a much narrower construction.  However, Merus argued that constant region of the gene segments in the claimed mouse contained either mouse or human genes, and could be reverse chimeric, humanized, or fully human.  Thus, Merus argued a broader construction of Claim 1.

Regeneron-Claim1-murine-Ig

The court found that the transitional phrase “comprising” was an open-ended term, use of the term did not exclude unrecited elements.[10]  Therefore, the germline was not just limited to mouse and also included human, which further meant the claim language included reverse chimeric, human and fully human genes.[11]

On the intent requirement, inferred intent to deceive was demonstrated by Regeneron’s in-house patent practitioner’s failure to produce discovery documents relevant to the prosecution of the ‘018 patent.  This was deemed the litigation misconduct.  Further, Regeneron had an intent to deceive because their in-house counsel failed to submit the four prior art references during the prosecution of the ‘018 patent, as it was in the belief of the in-house counsel that the references were not material to patentability.   The Federal Circuit pointed out that “Regeneron’s litigation misconduct [] obfuscated its prosecution misconduct.”[12]  Thus, the Federal Circuit held the district court did not abuse its discretion by drawing an “adverse inference of specific intent to deceive”[13] on the part of Regeneron.

Inequitable conduct is a serious issue in prosecution because, as a defense, and if used successfully, it could not only invalidate one claim of a patent but also the entire patent is found unenforceable, which cannot be cured by a reissue.[14]  This may be the reason why these cases have convoluted and lengthy histories because these issues could not be resolved back in the PTAB.

Another post-Therasense case, American Calcar v. American Honda Motor Co., [15]  also went through the numerous machinations of the federal court system, and also turned out badly for the plaintiff.  In that case, a car guidance system patent were at issue.  The Federal Circuit affirmed the district court’s ruling that the patent was invalid under §§102 and 103, and unenforceable due to inequitable conduct due to inventor’s failure to submit prior art.

As for the intent requirement, the court determined that the Calcar inventor knew that his photos of the Honda Acura car were material to patentability, and therefore, withheld them from the Examiner.  In doing so, the Calcar inventor had the specific intent to deceive the USPTO because there was an inference the inventor had undisclosed information about the Honda Acura car system (i.e., the prior art), he knew it was material, and, further, he deliberately withheld it from disclosure as required under 1.56.

These line of cases show that the there are ramifications post-prosecution, and that intent to deceive is not just limited to strictly those required under their 1.56 duty (i.e., the litigation counsel further downstream).  Further, as shown with Regeneron, intent to deceive can go back upstream to the original patent prosecutor when the litigation counsel way down the river engages in litigation misconduct (i.e., it could lead to disciplinary action before the OED).  Based just on this most recent case, the case law is beginning to show a trend of broad interpretation of intent to deceive and materiality required to show inequitable conduct.  As such, this case should be of deep concern for all patent practitioners.

[1] 144 F. Supp. 3d 530 (S.D.N.Y. 2015) (District Court found materiality of the prior art references), aff’d in divided Court, ___Fed. Appx.___ (Fed. Cir. 2017), CAFC No. 16-1346.

[2] Therasense, Inc. v. Becton Dickinson & Co., summ. j. granted, 560 F. Supp. 2d 835, 854, aff’d, 565 F. Supp. 2d 1088, 1127 (N.D. Cal. 2008), aff’d, 593 F.3d 1289, 1311 (Fed. Cir. 2010), reh’g granted, vacated & remanded, 649 F.3d 1276 (Fed. Cir. 2011) (en banc), aff’d upon remand, 864 F. Supp. 2d 856, 858 (N.D. Cal. 2012), aff’d on other grounds, 745 F.3d 513 (Fed. Cir. 2014).

[3] Id., 649 F.3d at 1290-91.

[4] See 37 C.F.R. §1.56(c); MPEP 2001.01.

[5] See 37 C.F.R. §1.56(b); MPEP 2001.05.

[6] See MPEP 2001.05.

[7] See 37 C.F.R. §1.56(b).

[8] See Therasense, supra, 649 F.3d at 1287, 1290.

[9] Id. (citing Star Scient. Inc. v. R.J. Reynolds Tobacco Co., 537 F.3d 1357, 1366 (Fed. Cir. 2008).  See also Regeneron, supra (slip op. at 40) (Newman, J., dissenting) (noting that inferred intent must still be proven, and “absence of trial findings cannot be substituted by inference.”).

[10] See MPEP 2111.03 (“[t]he transitional term ‘comprising,’ . . . is inclusive or open-ended and does not exclude additional, unrecited elements or method steps.”)

[11] See Regeneron, supra (slip op. at 5-6, 13-14).

[12] Id. (slip op. at 37).

[13] Id. (slip op. at 38).

[14] See MPEP 2016 (“once a court concludes that inequitable conduct occurred, all the claims … are unenforceable.”); MPEP 2012 (“both 35 USC 251 and 37 CFR 1.175 . . . require that the error must have arisen ‘without any deceptive intention.’”).

[15] Am. Calcar, Inc. v. Am. Honda Motor Co., Inc., Case No. 06-cv-02433, 2008 WL 8990987 (S.D.Cal. Nov. 3, 2008), vacated and remanded in part, 651 F.3d 1318 (Fed. Cir. 2011), aff’d upon remand, Case No. 06-cv-0233, 2012 WL 1328640 (S.D.Cal. Apr. 17, 2012), aff’d, 768 F.3d 1185 (Fed. Cir 2014).

SCOTUS Watch: Cert Granted in Oil States: the Constitutionality of IPR Proceedings

By Brent T. Yonehara

On June 12, 2017, the U.S. Supreme Court granted the petition for certiorari in Oil States Energy Services v. Greene’s Energy Group, LLC.[1]  Of the three issues presented by petitioner Oil States, only one will be heard before the Supreme Court, namely:

Whether inter partes review – an adversarial process used by the Patent and Trademark Office (PTO) to analyze the validity of existing patents – violates the Constitution by extinguishing private property rights through a non-Article III forum without a jury.

(for the granted petition, see here.)

The other two issues requested by Oil States will not be addressed before the Court.

Inter partes reviews (IPRs) were one of the adversarial proceedings created by the America Invents Act (AIA) in 2012.  IPRs replaced the inter partes reexamination proceedings following enactment of AIA on September 16, 2012.[2]

The immediate question is whether patents, once issued, are either a private right (i.e., a private property right) or a public right, where the validity or invalidity can be determined by a government agency regulating the issuance of patents.  The Court of Appeal for the Federal Circuit, from where this case was last heard, ruled against Oil States’ contention that patent rights are private rights, not public rights, and are not subject to Article III treatment.  To quote Oil States, “ . . . patent rights are property rights, and property rights are pivate rights – not ‘public rights’.”[3]  There are some commentators who believe the Supreme Court will overturn the decision of the Federal Circuit, as it has been apt to do of late.  However, in the very recent B&B Hardware case, the Supreme Court held that TTAB’s decisions received preclusive effect, essentially holding that TTAB was an Article III court.[4]  While B&B Hardware dealt with issue preclusion and trademarks, it could be seen as a corollary to Oil States and patents in that the the Supreme Court might, consistent with its holding in B&B Hardware, extend this concept of Article III treatment to the patent side of the USPTO.  If it does, the Supreme Court will have the permitted the rare act of affirming a Federal Circuit decision.

Depending on the outcome, this case could demolish the entire AIA review adjudication process within the USPTO.

The case should be heard sometime in Fall 2017, with a ruling delivered sometime in early 2018.

[1] 639 F.App’x 639 (Fed. Cir. 2016), cert granted, ___U.S.L.W.___ (June 12, 2017) (No. 16-712).

[2] MPEP 2601.

[3] See Reply Brief for the Petitioner, at 9.

[4] B&B Hardware, Inc. v. Hargis Industries Inc., 575 U.S.___ (2015) (slip op. at 14-15).

SCOTUS Watch: Supreme Court Redefines the Patent Exhaustion Doctrine

By Brent T. Yonehara

On May 30, 2017, the U.S. Supreme Court decided Impression Products, Inc. v. Lexmark International, Inc.[1], reversing the Court of Appeals for the Federal Circuit on the scope of the patent exhaustion doctrine, also known as the first sale doctrine, and unequivocably stated in its opinion that “a patentee’s decision to sell a product exhausts all of its patent rights in that item, regardless of any restrictions the patentee purports to impose or the location of the sale.”[2]  This will greatly expand the definition of patent exhaustion.

The Court stated in its analysis by explaining that the Patent Act grants patent holders the right to exclude others from making, offering for sale or selling of the invention (emphasis added).[3]  However, this right to exclude has, at least, one limitation, namely the patent exhaustion doctrine.  When the patentee sells a product, that product no longer is a vestige of the patent monopoly, but rather the private property of the buyer.[4]  Consequently, patent rights are superseded by the principle against restraints on alienation.  The Court noted that while the Patent Act “promotes the progress of . . . the useful arts [] by granting to [inventors] a limited monopoly” to allow inventors to reap the windfall of that monopoly on their inventions.[5]

However, once the windfall of patent law is achieved, the law does not extend any restraint on the “use and enjoyment of the thing sold.”[6]  In other words, while a patentee can control price, negotiations, and sale terms of a product, the patentee cannot control the “use or disposition” of that product after it is sold to the buyer.[7]  Essentially, the sale “terminates all patent rights to the item.”[8]

Further, a contractual restriction will not extend the patentee’s patent rights to the product sold.  Once a patentee “sells a product, under an express restriction, the patentee does not retain patent rights in that product.”[9]

“Patent exhaustion reflects the principle that, when an item passes into commerce, it should not be shaded by a legal cloud on title as it moves through the marketplace.”[10]

With this ruling, Impression Products will bring a level of consistency across other intellectual properties, most notably copyrights, where the Court recently held in favor of international exhaustion in the copyright first sale doctrine in its Kirtsaeng v. John Wiley & Sons, Inc.[11] case.  With these cases, the two intellectual properties described in the Patent and Copyright Clause of the U.S. Constitution[12] will have the first sale doctrine applied uniformly to both patent and copyright licensing.  The Court elucidated that the Patent Act, like the Copyright Act, allows for a state-sanctioned monopoly to inventors (and authors) for a limited period of time, and to recoop their investment in those intellectual and creative endeavors.  However, there are limits to that state-sanctioned right, and once a patentee has sold its first product based on its patent, the legal protections fall outside of the Patent Act and into other areas of law, like contracts or torts.[13]  Indeed, the Court further made clear that:

differentiating the patent exhaustion and copyright first sale doctrines would make little theoretical or practical sense [because] there is a ‘historic kinship between patent law and copyright law’,” and the bond between the two leaves no room for a rift on the question of international exhaustion.”[14]

The decision was unanimous as to domestic patent exhaustion, and 7-1 as to international patent exhaustion, with only Justice Ruth Bader Ginsburg as the lone dissenter.  Impression Products will have a major impact on the patent licensing industry.  Specifically, licensing terms may need to be redefined, and could also severely impact licensing of pharmaceutical or medical device products which have extensive post-sale limitations built into the agreements.

[1] 581 U.S.___ (2017).

[2] Id., slip op. at 13.

[3] Id. at 5.

[4] Id. at 6.

[5] Id.

[6] Id. at 6 (citing United States v. Univis Lens Co., 316 U.S. 241, 251 (1942)).

[7] Id. (citing Univis, supra, at 250).

[8] Id. (citing Quanta Computers, Inc. v. LG Electronics, Inc., 553 U.S. 617, 625 (2008)).

[9] Id. at 8 (citing Boston Store of Chicago v. American Graphophone Co., 246 U.S. 8, 17-18 (1918)).

[10] Id. at 11 (citing United States v. General Electric Co., 272 U.S. 476, 489-490 (1926)).

[11] 568 U.S.___, 133 S. Ct. 1351 (2013).

[12] U.S. Const., Art. I, Sec. 8, Cl. 8: “. . . 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.”

[13] See Florian Mueller, Supreme Court rules against Lexmark on patent exhaustion, strengthening FTC/Apple cases against Qualcomm, Foss Patents, May 30, 2017 (“No overcompensation.  No overleveraging.  No double-dipping.  No restrictions that go beyond what the Patent Act allows.  That’s the message here.”).

[14] 581 U.S.___, supra, at___ (slip op. at 14-15) (citing Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417, 439 (1984)).

Fed Circuit Watch: Helsinn and the On-Sale Bar

By Brent T. Yonehara

On May 1, 2017, the Federal Circuit Court of Appeals decided Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA, Inc., 2016-1284, 2016-1787 (Fed. Cir. 2017), holding that the on-sale bar of pre-AIA 35 U.S.C. § 102(b) invalidated four patents held by Helsinn, for treatment of chemotherapy-induced nausea and vomiting (CINV).

The patents at issue were, 7,947,724, 7,947,725, 7,960,424, and 8,598,219.  All of these patents shared a priority date of January 30, 2003, and a critical date of January 30, 2002 for purposes of pre-AIA 35 U.S.C. § 102(b).  Helsinn and MGI Pharma, Inc. entered into a sales agreement which was signed on April 6, 2001.  This agreement was then announced in a press release and in an SEC filing with a copy of the agreement, albeit in redacted form, on April 25, 2001.  This April 25, 2001 date would, therefore, represent a public disclosure of the invention’s subject matter prior to the critical date of January 30, 2002.

Claim 2 of the ‘724 patent and Claim 1 of the ‘219 patent were deemed representative of the asserted claims:

2.  A pharmaceutically stable solution for reducing emesis or reducing the likelihood of emesis comprising:

a) 5 mg/mL palonosetron hydrochloride, based on the weight of the free base, in a sterile injectable aqueous carrier at a pH of from 4.5 to 5.5;

b) from 0.005 mg/mL to 1.0 mg/mL EDTA; and

c) mannitol in an amount sufficient to tonicify said solution, in a concentration of from about 10 mg/ml to about 80 mg/ml.

  1. A pharmaceutical single-use, unit-dose formulation for intravenous administration to a human to reduce the likelihood of cancer chemotherapy-induced nausea and vomiting, comprising a 5 mL sterile aqueous isotonic solution, said solution comprising:

palonosetron hydrochloride in an amount of 0.25 mg based on the weight of its free base;

from 0.005 mg/mL EDTA; and

from 10 mg/mL to about 80 mg/mL mannitol,

wherein said formulation is stable at 24 months when stored at room temperature.[1]

The on-sale bar invalidates a patent if the patented subject matter is (i) subject of a commercial sael or offer for sale prior to the critical date of the patent, and (ii) ready for patenting.[2]  Both pre-AIA and post-AIA treatments of § 102 utilize the Pfaff steps of  the on-sale bar.

Pre-AIA 35 U.S.C. § 102(b) barred a patent if: “…(b) the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of application for patent in the United States.”[3]

AIA 35 U.S.C. § 102(a)(1) barred a patent if: “…the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.”[4]

(Emphasis added.)

The Federal Circuit held that sale agreement between Helsinn and MGI constituted a commercial sale for purposes of 35 U.S.C. § 102(b) on-sale bar because the facts met the definition of the on-sales bar of § 102(b).  As noted by the Federal Circuit, Helsinn did not require confidentiality with its execution of the sales agreement, and was an unambiguous contemplation of a sale between Helsinn and MGI.[5]

The Federal Circuit also held that, for purposes of an on-sale bar under AIA 35 U.S.C. § 102(a)(1), “ after AIA, if the existence of the sale is public, the details of the invention need not be publicly diclosed in the term of sale.”[6]  Helsinn had argued that for AIA purposes, the on-sale bar did not apply until the sale disclosed the subject matter of the invention to the public.  The Federal Circuit disagreed, rationalizing that preventing such a bar would be “a foundational change in the theory of the statutory on-sale bar.”[7]  Rather, all that is required is if there is a sale or offer to sell which embodies the invention, and that sale is then made public.[8]

As for whether the claims were “ready for patenting,” the Federal Circuit found that the 0.25 mg of palonosetron formulation met the burden, and that evidence was “overwhelming” that the formulation was properly reduced to practice work for its intended purposes for limiting the likelihood of emesis.[9]

The implications of this case could be quite profound.  For purposes of the AIA 35 U.S.C. § 102(a)(1) on-sale bar, public disclosure of a sale of a patented invention could effectively invalidate that patent even though the invention’s specifics were not disclosed in the public disclosure of that sale.

[1] Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA, Inc., 2016-1284, 2016-1787 (Fed. Cir. 2017), slip op. at 5.

[2] Pfaff v. Wells Elecs., Inc., 525 U.S. 55, 67 (1998).

[3] 35 U.S.C. § 102(b) (pre-AIA); MPEP 2133.

[4] 35 U.S.C. § 102(a)(1) (AIA); MPEP 2152.

[5] Helsinn, slip op. at 16-17.

[6] Id. at 27.

[7] Id. at 22.

[8] Id. at 23.

[9] Id. at 30.

SCOTUS Watch: TC Heartland LLC v. Kraft Foods Group Brands LLC

By Brent T. Yonehara

On May 22, 2017, the U.S. Supreme Court handed down an important ruling, TC Heartland LLC v. Kraft Foods Group Brands LLC, 581 U.S.___ (2017), in patent venue, and specifically limited the ability of patent litigation plaintiffs to file in nearly any U.S. District Court in the country, and held a defendant domestic corporation can only be sued for patent infringement only in its state of incorporation.

Venue for patent cases is delineated by 28 U.S.C. § 1400(b): “any civil action for patent infringement may be brought in the judicial district where the defendant resides, or where defendant has committed acts of infringement and has a regular and established place of business.”[1]  Note that for purposes of the TC Heartland case, the Court only addressed the defendant’s “residence,” and not “place of infringement.”

Also, and more importantly,  § 1400(b) differs from the general venue statute, 28 U.S.C. § 1391(c): …(2) an entity with the capacity to sue and be sued in its common name under applicable law, whether or not incorporated, shall be deemed to reside, if a defendant, in any judicial district in which such defendant is subject to the court’s personal jurisdiction with respect to the civil action in question and, if a plaintiff, only in the judicial district in which it maintains its principal place of business. [2]

(Emphasis added).

The Court analyzed Congressional enactment of both venue statutes, as well as the Court’s own decision in Fourco Glass Co v. Transmirra Prods. Corp., 353 U.S. 222 (1957), noting that § 1400(b) is the “sole and exclusive provision controlling venue in patent infringement actions, and . . . is not supplemented by [] § 1391(c).”[3]  In other words, the general venue statute does not override the patent venue statute.  The Court decidedly overruled the Federal Circuit’s 25 year expansive patent venue.

This ruling will have an emasculation effect on the Non-Practicing Entities (NPEs, or “patent trolls”)’s ability to control patent infringement cases especially if they are not able to file their complaint in their choice of district court.  Some commentators have been quite harsh about reigning in the patent trolls’ venue selection.  The biggest patent litigation venue, by far, has been the Eastern District of Texas, a rural district known to be pro-plaintiff.  Patent trolls flocked to the E.D. Texas with 87% filing their patent infringement suits in that district.  The District of Delaware, Northern District of California, Central District of California, and Northern District of Illinois were far behind.  These latter four districts appear to be the heavy beneficiaries of TC Heartland, as many companies are either incorporated in Delaware, or headquartered in Silicon Valley or San Francisco.

While this ruling will not end the patent troll phenomenon, it will place hindrances on this type of litigant.

[1] 28 U.S.C. § 1400(b).

[2] 28 U.S.C. § 1391(c).

[3] 581 U.S.___ (2017) (slip op. at 5, citing Fourco Glass Co. v. Transmirra Prods. Corp., 353 U.S. at 229).

ALICE IN WONDERLAND: SOFTWARE PATENTS IN LIGHT OF ALICE CORP. v. CLS BANK INT’L

By Brent T. Yonehara

INTRODUCTION

Alice Corporation v. CLS Bank International was recently decided by the U.S. Supreme Court in the closing days of its 2013-2014 term.[1] In Alice, the Supreme Court found that patent claims that do not “transform” from patent-ineligible subject matter to a patent-eligible invention were abstract ideas outside the scope of 35 U.S.C. §101.[2] News has been mostly favorable of the Alice decision.[3] However, it has not been unanimous. Critics’ comments of the Alice ruling range from indignant[4] to excoriating.[5] This paper examines the Alice decision by analyzing its new test to determine whether software claims are patent-eligible subject matter.

DISCUSSION

Analyzing Alice

Software patents, and business methods, may occupy a demilitarized zone of questionable claims construction.[6] The Supreme Court has long held that “laws of nature, natural phenomena, and abstracts ideas are not patentable.”[7] In Alice, The Supreme Court begins its analysis by reviewing its previous ruling in Mayo v. Prometheus. [8] In Mayo, patents involving therapeutic drugs were at issue.[9] Independent claim 1, a method claim, was directed toward the drug and dosage administration[10] and the process in which the thiopurine compounds metabolize to produce the therapeutic result.[11] The Court held that this process was nothing more than a law of nature, and thus not patentable.[12] The Mayo Court further enunciated a two-step test to determine patentability.[13] This test was then applied by the Alice Court to determine whether software patent claims are patentable.[14]

The first question is whether the claims at issue are directed toward an unpatentable subject matter.[15] If the answer is “yes,” then the second question is whether taking the claim individually and “as an ordered combination” produce any other elements to transform the claim into a patentable subject matter.[16]

The Alice method claims in U.S. Patent No. 5,970,479 (‘479) at issue were directed toward intermediated settlement.[17] The Court found that the Alice’s claims were only abstract ideas.[18] Additionally, the Court found that these claims failed to transform the mere idea into something patentable.[19] The claims merely required rudimentary computer implementation, which was not enough “transformation” to a patent-eligible invention.[20] The Court noted that the introduction of a computer did not make the invention “substantial and meaningful.”[21] Furthermore, the Court observed that the functions performed by a computer during each step of the method claim’s process were only “conventional,” and taken “as an ordered combination” did not add anything that “[was] already present when the steps [were] considered separately.” [22] As such, the Court invalidated the Alice method claims.[23]

Analyzing the Alice Aftermath

So, what is the practical effect of Alice? Certainly, the standard for what is patentable software and what is unpatentable ideas has gotten higher.[24] The software industry has been mostly exuberant, if not cautious, about the result from Alice. One commentator sees the Alice patents invalidation as necessary to “ridding the American patents of poor software, business process, and genetic patents.”[25] Another commentator seemed effusive since rendering some software patent claims as non-patentable ideas would be an additional weapon in the industry’s battle against patent trolls.[26] (I note, however, an errata in this commentator’s article – he noted that some in the industry want to move toward having software trademarked. Software, of course, cannot be trademarked, per se, although the trade name could be. The source code has long been protected as copyrightable media of expression.)[27]

Legal experts and commentators have been less than complimentary to the high court’s decision-rendering. One commentator labels the decision as “intellectually bankrupt,” since it makes issuing software patent claims (method, system, or computer-readable medium) more difficult.[28] A former United States Patent and Trademark Office (USPTO) director expressed disappointment because Alice did not provide needed clarity in determining patent-eligible software claims.[29] A law professor commentator, though, had the exact opposite reaction, noting that Alice provided a clearer path than the Bilski case enunciated with business methods.[30]

One thing of interest to note is the reaction from Australia’s high-tech community, and the intellectual property office, in particular. Since the now invalidated ‘479 patent claims priority to Australian patents, and which also provide priorities for European, Japanese, Chinese, Canadian, and New Zealand patents,[31] the Supreme Court’s invalidation could spur cancellation or invalidation proceedings in these respective jurisdictions.

CONCLUSION

Alice brought some finality, and for some, a little more certainty, for software patents after the Federal Circuit’s mess in the appellate ruling from over a year ago.[32] Like the fictional Alice, who fell into a world of amazement and wonder, the Alice ruling has dropped upon the high tech world a bit of both, as well. Some may be amazed (or, for others, dazed) by what is now plausible – a test which can determine what software claims are patentable and what are not. Still others will wonder about the day when software can be deemed patentable at all, or not. Until that day arrives, it keeps the rest of us in the IP world occupied with our day jobs.

By Brent Yonehara. Originally published at http://yonaxis.blogspot.com/2014/06/alice-in-wonderland-software-patents-in.html (June 26, 2014).

[1] See Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S.___ (2014) (slip op.), available at http://www.supremecourt.gov/opinions/13pdf/13-298_7lh8.pdf.

[2] Id. at___ (slip op. at 5-6).

[3] See, e.g., Julie Samuels, Patent Trolls Are Mortally Wounded, Slate, at http://www.slate.com/articles/technology/future_tense/2014/06/alice_v_cls_bank_supreme_court_gets_software_patent_ruling_right.html (June 20, 2014, 1:47 PM) (stating Alice Corp. furthers the goal of moving away from poorly-drafted software patents); Business Software Alliance, Supreme Court’s CLS Bank Decision Is a Victory for Innovation, Says BSA, at http://www.bsa.org/news-and-events/news/2014/june/06192014clsdecision (June 19, 2014) (noting the Court came to the right decision in Alice).

[4] See Free Software Foundation, US Supreme Court Makes Right Decision to Nix Alice Corp. Patent, but More Work Needed to End Software Patents for Good, at https://www.fsf.org/news/fsf-statement-on-alice-corp-v-cls-bank (June 19, 2014, 4:55 PM) (“Software patents are a noxious weed that needs to be ripped out by the roots.”).

[5] See Gene Quinn, SCOTUS Rules Alice Software Claims Patent Ineligible, IPWatchdog Blog, at http://www.ipwatchdog.com/2014/06/19/scotus-rules-alice-software-claims-patent-ineligible/id=50120/ (June 19, 2014, 6:44 PM) (commenting, unapologetically, that Alice was naively written and is an “asinine” decision.).

[6] See Daniel Fisher, Alice Corp. Patent Ruling Is Good For Software Firms, Bad News For Trolls, Forbes, at http://www.forbes.com/sites/danielfisher/2014/06/19/patent-lawyers-software-companies-like-alice-corp-ruling-trolls-not-so-much/ (June 19, 2014, 2:39 PM) (inferring, with some reluctance, that Alice was correct but currently business methods are tenuously patentable subject matter.).

[7] See Association for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S.___ (2013) (slip op., 11).

[8] See Mayo Collaborative Services v. Prometheus Labs., Inc., 566 U.S.___ (2012) (slip op., 8-10), available at http://www.supremecourt.gov/opinions/11pdf/10-1150.pdf.

[9] Id. at ___ (slip op., 4-5).

[10] Id. at___ (slip op., 5-6).

[11] Id. at___ (slip op., 8).

[12] Id. at___ (slip op., 8-9).

[13] Id.

[14] See Alice, supra note 1, at___ (slip op., 7).

[15] Id.

[16] Id.

[17] See CLS Bank Int’l v. Alice Corp. Pty. Ltd., 717 F.3d 1269, 1285, 106 U.S.P.Q.2D 1696 (Fed. Cir. 2013) (en banc). Method claim 33 of Patent No. 5,970,479 states: “A method of exchanging obligations as between parties, each party holding a credit record and a debit record with an exchange institution, the credit records and debit records for exchange of predetermined obligations, the method comprising the steps of:

(a) creating a shadow credit record and a shadow debit record for each stakeholder party to be held independently by a supervisory institution from the exchange institutions;

(b) obtaining from each exchange institution a start-of-day balance for each shadow credit record and shadow debit record;

(c) for each transaction resulting in an exchange obligation, the supervisory institution adjusting each respective party’s shadow credit record or shadow debit record, allowing only these transactions that do not result in the value of the shadow debit record being less than the value of the shadow credit record at any time, each said adjustment taking place in chronological order; and

(d) at the end-of-day, the supervisory institution instructing ones of the exchange institutions to exchange credit or debits to the credit record and debit record of the respective parties in accordance with the adjustments of the said permitted transactions, the credits and debits being irrevocable, time invariant obligations placed on the exchange institutions. Id.

[18] See Alice, supra note 1, at___ (slip op., 7).

[19] Id. at___, (slip op., 10).

[20] Id. at ___, (slip op. 10-11).

[21] Id. at___, (slip op., 14).

[22] Id. at___, (slip op., 15).

[23] The system claims and computer-readable medium claims were also thrown out by the Alice Court. Id. at____, (slip op., 16).

[24] See Brian Fung , The Supreme Court’s Decision on Software Patents Still Doesn’t Settle the Bigger Question, The Washington Post, available at http://www.washingtonpost.com/blogs/the-switch/wp/2014/06/20/the-supreme-courts-decision-on-software-patents-still-doesnt-settle-the-bigger-question/ (June 20, 2014).

[25] See Steven J. Vaughan-Nichols, Software Patents Take a Hit, But They’re Far From Dead, ZDNet, at http://www.zdnet.com/software-patents-take-a-hit-but-theyre-far-from-dead-7000030745/ (June 19, 2014, 14:10 PDT).

[26] See Seth Rosenblatt, Supreme Court Raises Bar on Software Patent Claims, CNET, at http://www.cnet.com/news/despite-supreme-court-decision-software-still-eligible-for-patents/ (June 19, 2014, 1:36 PM PDT).

[27] In all fairness, however, I should give this commentator the benefit of the doubt; he does not have a legal background nuanced in the idiosyncrasy of intellectual property laws.

[28] See Quinn, supra note 5 (quoting Q. Todd Dickinson, Director of the USPTO under President Clinton, stating that the Court should have given more clarity to the issue of software patent claims).

[29] Id.

[30] See Rob Preston, Supreme Court Toughens Business Process Patent Test, InformationWeek, at http://www.informationweek.com/software/enterprise-applications/supreme-court-toughens-business-process-patent-test/a/d-id/1278736 (June 20, 2014, 11:16 AM) (quoting Professor Robin Feldman of University of California, Hastings College of the Law in stating that “the Court sent a strong message with the Alice decision.”) See also Bilski v. Kappos, 561 U.S. 593, 599 (2010) (holding business method claims directed toward financial risk hedging was too abstract an idea to be patentable).

[31] See ESPACENET database search, conducted June 26, 2014, at http://worldwide.espacenet.com/publicationDetails/inpadocPatentFamily?CC=US&NR=5970479A&KC=A&FT=D&ND=3&date=19991019&DB=EPODOC&locale=en_EP (June 26, 2014).

[32] See CLS Bank Int’l, supra note 17.