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Archived updates for Friday, December 30, 2005

TGIF for Patently Seasonal Multiculturalism

US Patent No. D501980
for "Seasonal Multicultural Hat"
to Cynthia Siebert of Port Monmouth, NJ

Thank Goodness It's Friday (and Shalom Aleichem),

-Bill Heinze
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Topical Application Did Not Anticipate Sunburn Treatment

In Perricone, M.D. v. Medicis Pharmaceutical Corp. (Fed. Cir. December 20, 2005) the court agreed that claim 9 of U.S. Patent No. 5,409,693 was invalid for obviousness-type double patenting in view of claim 1 of U.S. Patent No. 5,574,063, but left open the possibility of remedying the problem with a terminal disclaimer two years after the lower courts holding of invalidity.

Claim 1 of the ’693 patent recited:

1. A method for treating skin sunburn comprising topically applying to the skin
sunburn a fatty acid ester of ascorbic acid effective to solubilize in the
lipid-rich layers of the skin an amount effective to scavenge therefrom free
radicals present as a result of transfer of energy to the skin from the
ultraviolet radiation which produced said sunburn.
while claim 9 of the ’063 patent recited:

9. A method for the treatment of skin damaged or aged by oxygen-containing free
radicals or oxidative generation of biologically active metabolites which
comprises topically applying to affected skin areas a composition containing an
effective amount of an ascorbyl fatty acid ester in a dermatologically
acceptable, fat-penetrating carrier such that the ester is percutaneously
delivered to lipid-rich layers of the skin.
Circuit Judge Rader opinion agreed with the district court that the "effective to solubilize" language in claim 1 meant the "dermatologically acceptable fat-penetrating carrier" in claim 9. The court also reasoned that since sunburn is a species of skin damage, there was no error in the district court’s determination that the earlier species (sunburn treatment) rendered the later genus (skin damage treatment) claims invalid under non-statutory double patenting.

Finally, and contrary to the suggestion by the district court, the Patent
Act and PTO rules support the filing of a terminal disclaimer even after
issuance of the second patent. See 35 U.S.C. § 253 (2000) ("[A]ny patentee . . .
may disclaim or dedicate to the public the entire term, or any terminal part of
the term, of the patent granted . . . ."); 37 CFR § 1.321(a) (incorporating the
language of § 253). The district court’s focus on In re Goodman, 11 F.3d 1046,
1052 (Fed. Cir. 1993) (explaining that a terminal disclaimer can overcome a
double patenting "rejection") seems to have led to its conclusion that a
terminal disclaimer cannot be filed for an issued patent to overcome invalidity
based on double patenting. The commentary from In re Goodman arose in the
context of ex parte prosecution, a setting not applicable to this case. An
applicant must always overcome every rejection to gain issuance of a patent.
Accordingly, the pre-issuance timing requirement of a terminal disclaimer to
overcome a double patenting rejection does not dictate a prohibition on
post-issuance terminal disclaimers. A terminal disclaimer can indeed supplant a
finding of invalidity for double patenting. See Applied Materials, Inv. v.
Semiconductor Materials Am., Inc., 98 F.3d 1563, 1577 (Fed. Cir. 1996) ("For
obviousness-type double patenting, [the improper extension of the statutory
term] problem can sometimes be avoided for co-owned patents . . . through the
use of a terminal disclaimer."). This record, however, does not include any
evidence of a disclaimer even though the district court invalidated the claims
over two years ago. Thus, while Dr. Perricone might still file a terminal
disclaimer to overcome prospectively the double patenting basis for invalidity,
this court makes no determination about the retrospective effect of such a
terminal disclaimer.
With regard to anticipation, the court also held that the general disclosure of a similar lotion for "topical application" was insufficient to suggest the specific application to "treating skin sunburn."

The issue is not, as the dissent and district court imply, whether Pereira’s lotion if applied to skin sunburn would inherently treat that damage, but whether Pereira discloses the application of its composition to skin sunburn. It does not.

This court explained in Catalina Marketing International, Inc. v. Cool, Inc. that a patent to an apparatus does not necessarily prevent a subsequent inventor from obtaining a patent on a new method of using the apparatus. 289 F.3d 801, 809 (Fed. Cir. 2002). New uses of old products or processes are indeed patentable subject matter. See 35 U.S.C. § 101 (2000) (identifying as patentable "any new and useful improvements" of a process, machine, manufacture, etc.); In re King, 801 F.2d 1324, 1326 (Fed. Cir. 1986) (principles of inherency do not prohibit a process patent for a new use of an old structure). That principle governs in this case as well.

Claim 1 of the ’693 patent recites a new use of the composition disclosed by Pereira, i.e., the treatment of skin sunburn. The district court’s inherent anticipation analysis for this claim contains a flaw. The disclosed use of Pereira’s lotion, i.e., topical application, does not suggest application of Pereira’s lotion to skin sunburn. In other words, the district court’s inherency analysis goes astray because it assumes what Pereira neither disclosed nor rendered inherent. Because Pereira does not disclose topical application to skin sunburn, this court reverses the district court’s holding that Pereira anticipates claims 1-4 and 7 of the ’693 patent.

Like the district court, the dissent seems to ignore, or at least dismiss as "not substantial[]," the distinction between Dr. Perricone’s claimed method and Pereira’s disclosed method. Thus, the dissent characterizes both methods the same way: "Pereira describes not only the same product that is claimed in the sunburn patent, but also the same method of using it, i.e., topically applying it to the skin in an
amount necessary to have beneficial effects on the skin." Unfortunately, the
dissent can make that statement only by dismissing the explicit language of Dr.
Perricone’s claimed method: "applying to the skin sunburn." Skin sunburn is not analogous to skin surfaces generally. Thus, there is an important distinction between topical application to skin for the purpose of avoiding sunburn, and the much narrower topical application to skin sunburn.

That distinction highlights the flaw in the dissent’s knee brace hypothetical,
which suggests that a particular prevention method necessarily anticipates a
treatment method. To use a more apt analogy, the disclosure that a sunburn can
be prevented by wearing a hat clearly does not anticipate a claim to the
discovery that one can treat an existing sunburn by putting on a hat. The
dissent attempts to bolster its analogy by comparing the mechanism underlying
its knee brace analogy to Dr. Perricone’s invention. With that comparison, the
dissent drifts even farther from the facts of this case. The alleged anticipating reference here is Pereira, not Dr. Perricone’s own teachings.

Pereira is silent about any sunburn prevention or treatment benefits, not to
mention the mechanisms underlying such uses. If Pereira did teach sunburn
prevention, as well as the mechanism behind that prevention, those teachings
might suggest that Dr. Perricone’s sunburn treatment claims would have been
obvious. However, those unrealized possibilities do not alter the analysis in
this case where Pereira does not disclose topical application to skin sunburn.

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A Template for Non-Precedential Appellate Opinions

With non-precedential opinions on their way out at the Court of Appeals for the Federal Circuit, Professor Hal Wegner suggests that the per curiam decision in In re Huber (Fed. Cir. December 20, 2005) represents a good model for a substitute for non-precedential and Rule 36 affirmances. Here's what he would do to make it even better:
First, there should be a nomination of the counsel for the parties.
Without consideration of the merits of the Huber case itself (which is
impossible to glean from the opinion, alone), there are too many litigants
before the court who take frivolous positions, yet maintain an apparently good
track record because their names do not appear on the Westlaw and Lexis
databases. Nomination of counsel ends anonymity and provides the public
consumers – the general counsel of corporations and individual inventors as well
– more transparency to see who’s doing a good job – and who’s not.

Second, where there is an affirmance of an opinion below, it is useful to
know what that opinion says. This is particularly true of the “black hole”
of PTO affirmances where it would be of great benefit to both litigators at the
Federal Circuit and – particularly – PTO prosecutors to get a better glimpse
into the largely shrouded world of ex parte case law at the Board. Here,
the Solicitor has it within his power to post all Board decisions on the PTO
website at the time of a Notice of Appeal to the court either on his own or
through a simple rule-making change.
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Claim Construction Required to Support Injunction

In Shuffle Master, Inc. v. Vendingdata Corp. (Fed. Cir., December 27, 2005, not citable as precedent) the court discussed the the requirements for claim construction in a preliminary injunction proceeding:

We have held that a district court does not have to conduct a comprehensive and
final claim construction in a preliminary injunction proceeding. Sofamor Danek
Group, Inc. v. DePuy-Motech, Inc., 74 F.3d 1216, 1221 (Fed. Cir. 1996).
Similarly, it is not necessary for a court to conduct an explicit claim
construction if the claim construction issue is a simple one that needs no
analysis, or in which there is no reasonable ground for dispute as to claim
meaning. Toro Co. v. Deere & Co., 355 F.3d 1313, 1322 (Fed. Cir. 2004).
However, a district court in a preliminary injunction proceeding has the duty to
determine whether the movant is likely to prevail on the merits, and if that
question turns on a contested issue of claim construction, the court must give
the claim construction issue the attention necessary to determine the likelihood
of success. In this case, the dispute over the meaning of the "set of cards"
limitation is central to determining whether Shuffle Master is likely to prevail
on the merits of its infringement claim. The district court was therefore
required to provide some form of claim construction, even if abbreviated,
preliminary, or tentative.

Shuffle Master argues that the phrase "at least one set of cards within the apparatus" means any number of cards that serve as the source from which the apparatus delivers hands to the delivery tray. Under that construction, it appears likely that the PokerOne device would infringe, since the internal stack in the PokerOne forms within the device and serves as the source from which dealing begins after the collection reaches a size equal to two hands of cards of the game being played. On the other hand, VendingData argues that the "set of cards within the apparatus" must be construed to refer to a set consisting of no more than one hand of cards. Under that interpretation, it appears likely that the PokerOne device would not infringe, since the internal stack accumulates cards until it contains at least two hands of cards before dealing begins. Thus, resolution of the claim construction issue framed by the parties is of critical importance to the issue of infringement.

. . . While claim construction is a question of law, the district court’s analysis is important to the process of claim construction, and in this context, as in others, we decline to construe the claim without the guidance of the district court’s construction. See Nazomi Commcns., Inc. v. Arm Holdings, PLC, 403 F.3d 1364, 1371 (Fed. Cir. 2005) ("This court’s review of a district court’s claim construction, albeit without deference, nonetheless is not an independent analysis in the first instance. Moreover, in order to perform such a review, this court must be furnished ‘sufficient findings and reasoning to permit meaningful appellate scrutiny.’"); Anchor Wall Sys., Inc. v. Rockwood Retaining Walls, Inc., 340 F.3d 1298, 1311 (Fed. Cir. 2003) ("In order to review the court’s finding of noninfringement, we must know what meaning and scope the district court gave to the asserted claims."); Gechter v. Davidson, 116 F.3d 1454, 1460 (Fed. Cir. 1997) (vacating and remanding decision of the Board of Patent Appeals and Interferences because it failed to "set forth . . . specific findings of fact and conclusions of law adequate to form a basis for . . . review"; noting that "[c]laim construction must . . . be explicit, at least as to any construction disputed by [the] parties"); Graco, Inc. v. Binks Mfg. Co., 60 F.3d 785, 791 (Fed. Cir. 1995) ("entire omission of a claim construction analysis from the opinion . . . provide[s] an independent basis for remand"). We therefore vacate the preliminary injunction and remand this case to the district court for further proceedings consistent with this opinion.

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Archived updates for Thursday, December 29, 2005

What Patent Transfers Tell Us About the Market for Intellectual Property

Thanks to James Bessen at the Technological Innovation and Intellectual Property Blog for helping non-economists understand Carlos J. Serrano's "The Market for Intellectual Property: Evidence from the Transfer of Patents." Among other lessons noted by Mr. Bessen,

Serrano finds that the proportion of patents traded each year starts at about 2.5% and generally drops over time. The exception occurs right after a patent is renewed, when the percentage traded temporarily increases.

Patents that are cited more frequently by subsequent patents are more likely to be renewed and are also more likely to be traded. This provides some additional support for Serrano’s idea that these are more valuable patents.

Among patents of the same age, those that have been previously traded are more likely to be re-traded and less likely to expire. Again, this supports the idea that these are more valuable patents.

Making assumptions about the distribution of patent values, their change over time and the costs of trade, Serrano builds a mathematical model that describes patent owners’ decisions to trade and to renew patents. Then, using his data on transfer and renewal rates, he is able to fit the parameters of the model.

Using these fitted parameters, Serrano makes preliminary estimates of patent value. He estimates that the median value of a freshly-issued patent in his data set is about $21,000 and the mean value is $58,000 (in 2003 dollars). As other researchers have found, the distribution of patent values is highly skewed; there are a few highly valuable patents and numerous low-value ones. Serrano’s mean and median estimates are significantly higher than most of the estimates by researchers who have used European patent renewal data. This is not surprising since the size of the US market is much larger than the markets in individual European countries.
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U R Bustd?

According to the Associated Press on December 29, 2005 (via, South Korea will begin sending legal notices through mobile phones next year in order to save time, money, and enhance privacy.

"We will send legal notices through text and voice messages on a trial basis beginning in January," Jun Dae-jin, an official at the Supreme Prosecutors' Office, reportedly told The Associated Press. With regard to privacy concerns, he noted that family members and relatives of recipients could potentially see embarrassing legal notices if delivered by postal workers.

So-called "E-Ticket" traffic citations are already in use in New York.
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Archived updates for Wednesday, December 28, 2005

India Launches Traditional Knowledge Database

According to Gavin Rabinowitz writing for the Associated Press, a 2003 study by India's National Institute of Science Communication and Information Resources (NISCAIR) claims that "some 7 000 patents worldwide are based on Indian indigenous knowledge." The group has therefore "convened a group of 150 experts in traditional medicine, scientists, doctors, patent lawyers and computer programmers to put together the Traditional Knowledge Database Library (TKDL) ." According to the TKDL demo website,

Since time immemorial, India has possessed a rich traditional knowledge of ways
and means practiced to treat diseases afflicting people. This knowledge has
generally been passed down by word of mouth from generation to generation. Some
of them have been described in ancient classical and other literature, often
inaccessible to the common man. Documentation of this existing knowledge,
available in public domain, on various traditional systems of medicine has
become imperative to safeguard the sovereignty of this traditional knowledge and
to protect them from being misused in patenting on non-original discoveries, and
this has been a matter of national concern.

India fought successfully the revocation of turmeric and basmati patents granted by United States Patent and Trademark Office (USPTO) and neem patent granted by European Patent Office (EPO). As a sequel to this, in 1999, the Department of ISM&H constituted an inter-disciplinary Task Force, for preparing a report on establishing a TKDL.

TKDL is a collaborative project between NISCAIR (erstwhile NISCOM) and
Department of Indian System of Medicine and Homoeopathy (ISM&H), Ministry of
Health and Family Welfare
which been implemented at NISCAIR. An inter-disciplinary team of 25 Ayurveda experts, 1 patent examiner, 5 IT experts, 3 NISCAIR scientists and 4 technical officers are in place at present for carrying out the work.

TKDL will give legitimacy to the existing traditional knowledge and enable protection of such information from getting patented by the fly-by-night inventors acquiring patents on our traditional knowledge systems. The project TKDL proposes to document the knowledge available in public domain by sifting and collating the information on traditional knowledge from the existing literature covering Ayurveda, in digitized format in five international languages which are English, German, French, Japanese and Spanish.

Traditional Knowledge Resource Classification (TKRC), an innovative structured
classification system for the purpose of systematic arrangement, dissemination
and retrieval has been evolved for about 5000 subgroups against one group in
international patent classification, i.e. AK61K35/78 related to medicinal

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Archived updates for Tuesday, December 27, 2005

The Irish IP Good Practice Guide

In its Good Practice Guide on "10 pragmatic recommendations for a better integration of IP in your business," the Irish Patent Office recommends that you
  1. Be aware of your intellectual capital
  2. Know what intellectual property is
  3. Protect your intangible assets
  4. Choose the best protection for your intellectual assets
  5. Obtain protection
  6. Integrate IP in your strategy
  7. Use IP information
  8. Creat value with IP rights
  9. Enforce your IP rights
  10. Consult experts
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Archived updates for Friday, December 23, 2005

On the Value of Defensive Patent Filings in China

Mark Perkiss, writing for the Trenton Times on December 18, 2005 details the problems faced by Fiber Optic Designs when they contracted with Chinese manufacturers, under confidentiality agreements, to make their Forever Bright lights:

The company's dealings with Chinese manufacturing firms began well. As U.S. and Canadian sales of the LED lights grew, Fiber Optic Designs contracted with a second Chinese manufacturing company and then a third to increase production. That third company, which Allen and Bruno refuse to name, liked Allen's design. In fact, it liked the design so much that in 2003 it filed an application for a Chinese patent on the lantern design of the covering of the LED lights [after FOD had filed its own patent application in the U.S.].

. . . To demonstrate prior invention of the lantern design, the company tried to submit a copy of The Times from December 2001, which carried a story detailing the design in question. "The problem is, you cannot just submit the newspaper. They do not accept that as evidence," Bruno said. "You have to get a notary to attest that it is a genuine newspaper from the date in question," he said. "Then, you need to get a state judge to certify that the notary is a licensed professional in good standing. Then, you need to get a state agency to certify that the judge you used is, in fact, a judge. Then, you need to get the U.S. State Department to certify that the certifying state agency is legitimate. Then, you need to get the State Department to present the document to the Chinese embassy in Washington and you need to have the Chinese embassy certify that it received the document from a state department official that it recognizes as legitimate.

Allen said the company spent about $50,000 to successfully overturn the patent granted to the Chinese manufacturer.

Most patent attorneys would agree that Fiber Optics could have avoided the problem by filing for patent protection in China. However,

"The problem is that's a lengthy and costly process," said Sabrina Safrin,
of the Rutgers-Newark School of Law. "This company took a risk,
which many companies do, in not getting a patent in every jurisdiction. In their
defense, however, you would not expect someone to patent your invention in the
country where your invention is being manufactured."

In fact, it generally costs about $6,000 for a U.S. company to obtain a patent in China, with another $14,000 in maintance fee costs paid over the 20-year life of the patent. Although it can still be quite difficult to enforce a Chinese patent, the patent will serve as defensive prior (preventing a Chinese supplier from getting the same patent) even if the maintenance fees go unpaid and the patent is no longer enforceable.

As noted by Lawrence Ebert in his IPBiz Blog, "the first lesson is that non-disclosure agreements are not of great value, certainly not in China, and not even especially valuable in the US. The second lesson is that getting a patent application on file is what counts."

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TGIF for the Free, Bizarre Patent Calandar for 2006

Download Patscan's Bizarre Patent Calendar for 2006, including U.S. Patent No. 1,392,095 (1921)
to Stanley Valinsky for "Man-Catching Tank:"

And click here for Patently-O's lady-catching hat.

Thank Goodness It's Friday,

--Bill Heinze

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Archived updates for Thursday, December 22, 2005

Korea New ISA/IPEA for US PCT Applicants

Starting January 1, 2006, the Korean Intellectual Property Office (KIPO) will be available as an international searching and examining authority for international applications filed with the USPTO under the Patent Cooperation Treaty (PCT). According to the USPTO website, "The agreement will allow applicants additional flexibility to choose a given international authority based on the technology disclosed in the international application, speed of services provided and cost of obtaining searches and examination of international applications."

An applicant designating KIPO as the International Searching Authority (ISA) will pay a search fee of $218 instead of $300 or $1000, as applicable if the USPTO is the ISA. An applicant designating KIPO as the International Preliminary Examining Authority (IPEA) will pay an international examination fee to KIPO equivalent of $218 instead of $600 or $750, as applicable if the USPTO is the IPEA. Applicants filing international applications with the USPTO may, generally, also elect to have them searched and/or examined at the European Patent Office.

Click here for some of the history behind this change from Oppedahl & Larson.
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WIPO Audit Report Published

William New, writing for Intellectual Property Watch on December 21, 2005, has provided a link to the 28-page Ernst & Young audit report on the World Intellectual Property Organization. He also notes that, although the official press release from WIPO was entitled "Audit Report Finds no Fraud or Dishonest Acts in WIPO," the report actually states
“We cannot conclude that certain employees of WIPO and the third
parties concerned might have committed any fraud or dishonest acts. Experience
shows, however, that certain weaknesses in the management of the organisation,
such as described in this report, constitute a factor which might lead to
irregularities being committed.”
Brooks Robinson, spokeswoman for the United States mission in Geneva reportedly called the report "very damning."
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Focussing on Patents that Actually Matter

In a short magazine piece entitled "What to do About Bad Patents, "Mark Lemley, Douglas Lichtman, and Bhaven Sampat write that

Most patents do not matter. They claim technologies that ultimately failed in the marketplace. They protect a firm from competitors who for other reasons failed to materialize. They were acquired merely to signal investors that the relevant firm has intellectual assets. Or they were lottery tickets filed on the speculation that a given industry or invention would take off. Those patents
will never be licensed, never be asserted in negotiation or litigation, and thus
spending additional resources to examine them would yield few benefits.

. . . The problem, then, is not that the Patent Office issues a large number of bad patents. Rather, it is that the Patent Office issues a small but worrisome number of economically significant bad patents and those patents enjoy a strong, but undeserved, presumption of validity.

Framed this way, the solution naturally follows: The Patent Office should focus its examination resources on important patents and pay little attention to the rest. But it is difficult for the government to know ahead of time which patents are likely to be important.

They go on to urge three basic reforms to the patent system for addressing that problem. First, they would weaken the presumption of validity that today attaches to all issued patents. Second, because legitimate inventors need as much certainty as the law can provide, they would give applicants the option of earning a presumption of validity by paying for a thorough examination of their inventions. Third, they would institute a post-grant opposition system, a process by which parties other than the applicant would have the opportunity to request and fund a thorough examination of a recently issued patent. They beleive that these reforms would allow the Patent Office to focus its resources on patents that "might actually matter," reduce the incentive to file patents of questionable validity, and reduce the harm caused by any such questionable patents.

Overseas, in an move that is intended to address application pendancy, rather than patent quality, the Japanese Patent Office reportedly plans to ask its customers to only file for patents that could be "globally competitive." The number of patent applications in Japan awaiting examination is expected to surpass 800,000 by March of next year and the waiting period before the start of patent examination stood at 26 months on average in 2004. Get more on the Japanese Patent Office from Peter Haas's Patent Prospector Blog on December 23, 2005.
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EPO Defines Non-Patentable "Diagnostic Method"

Thanks to Axel Horn at the IPJUR Blog for pointing to a December 16, 2005 opinion from the EPO's Enlarged Board of Appeals regarding what is a non-patenatble "diagnostic method" under Article 52(4) of the European Patent Copnvention. According to the opinion headnotes:

    1. In order that the subject-matter of a claim relating to a diagnostic method practised on the human or animal body falls under the prohibition of Article 52(4) EPC, the claim is to include the features relating to:

      (i) the diagnosis for curative purposes stricto sensu representing the deductive medical or veterinarydecision phase as a purely intellectual exercise,

      (ii) the preceding steps which are constitutive for making that
      diagnosis, and

      (iii) the specific interactions with the human or animal body which occur when carrying those out among these preceding steps which are of a technical nature.
    2. Whether or not a method is a diagnostic method within the meaning of Article 52(4) EPC may neither depend on the participation of a medical or veterinary practitioner, by being present or by bearing the responsibility, nor on the fact that all method
      steps can also, or only, be practised by medical or technical support staff, the patient himself or herself or an automated system. Moreover, no distinction is to be made in this context between essential method steps having diagnostic character and non-essential method steps lacking it.

    3. In a diagnostic method under Article 52(4) EPC, the method steps of a
      technical nature belonging to the preceding steps which are constitutive for
      making the diagnosis for curative purposes stricto sensu must satisfy the
      criterion "practised on the human or animal body".

    4. Article 52(4) EPC does not require a specific type and intensity of interaction with the human or animal body; a preceding step of a technical nature thus satisfies the criterion "practised on the human or animal body" if its performance implies any interaction with the human or animal body, necessitating the
      presence of the latter.
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I/P Lawyers Per R&D Dollar Spent May Be Poor Metric

Companies that spend proportionately greater sums than their industry peers on R&D don’t enjoy greater revenue gains or better profits."Since IP lawyers and spending probably paces R&D spending, this counter-intuitive – and controversial – finding by Booz Allen Hamilton, as reported in the Wall. St. J., Vol. 246, Oct. 11, 2005 at A2, suggests that IP legal spending also reaches diminishing returns," writes Rees Morrison in his Law Department Management Blog. "What this means to law departments that have IP lawyers is that benchmarks of lawyers per R&D dollar spent could lead to flawed conclusions, if R&D spending is not a reliable marker of corporate fitness."
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Archived updates for Wednesday, December 21, 2005

USPTO Seeks Comments on Eligible Subject Matter Guidelines

On December 20, 2005, the United States Patent and Trademark Office (USPTO) requested comments from the public regarding its interim examination guidelines in used by USPTO personnel to determine whether the claims in a patent application are directed to patent eligible subject matter. Comments should be sent by electronic mail message over the Internet addressed to To be ensured of consideration, written comments must be received on or before June 30, 2006. No public hearing will be held.

According to the notice, the USPTO is particularly interested in comments addressing the following questions:
  1. Is the distinction between physical transformation and data transformation appropriate in the context of the Patent Subject Matter Eligibility Interim Guidelines? If not, please explain why and provide support for an alternative analysis.
    While the Patent Subject Matter Eligibility Interim Guidelines explain that physical transformation of an article or physical object to a different state or thing to another establishes that a claimed invention is eligible for patent protection, Annex III to the Patent Subject Matter Eligibility Interim Guidelines explains that identifying that
    a claim transforms data from one value to another is not by itself sufficient for
    establishing that the claim is eligible for patent protection. Therefore, claims that
    perform data transformation must still be examined for whether there is a practical application of an abstract idea that produces a useful, concrete, and tangible result.
  2. Is the USPTO interpretation of State Street Bank & Trust Co. v. Signature Financial Group Inc., 149 F. 3d 1368, 47 USPQ2d 1596 (Fed. Cir. 1998), as holding that if there is no
    physical transformation, a claimed invention must necessarily, either expressly or inherently, produce a useful, concrete, and tangible result (rather than just be ‘‘capable of’’
    producing such a result) either too broad or too narrow? If so, please suggest an alternative interpretation and reasons therefor.
  3. As the courts have yet to define the terms ‘‘useful,’’ ‘‘concrete,’’ and ‘‘tangible’’ in the context of the practical application requirement, are the explanations provided in the Patent Subject Matter Eligibility Interim Guidelines sufficient? If not, please suggest alternative explanations.
  4. What role should preemption have in the determination of whether a claimed invention is directed to a practical application of a 35 U.S.C. 101 judicial exception?
  5. Annex IV to the Patent Subject Matter Eligibility Interim Guidelines explains why the USPTO considers claims to signals per se, whether functional descriptive material or nonfunctional descriptive material, to be nonstatutory subject matter. Does the
    USPTO analysis represent a reasonable extrapolation of relevant case law? If
    not, please explain why and provide support for an alternative analysis. If
    claims directed to a signal per se are determined to be statutory subject
    matter, what is the potential impact on internet service providers, satellites,
    wireless fidelity (WiFi), and other carriers of signals?

The USPTO also notes that the U.S. Supreme Court has granted certiorari in Laboratory Corp. of America Holdings v. Metabolite Laboratories, Inc., S.Ct. No. 04–607 (LabCorp). See 546 U.S. ll (Nov. 2, 2005). The USPTO expects that a decision in LabCorp will be rendered sometime before the end of June 2006. Since the Court’s decision in LabCorp may impact the broader question of patent subject matter eligibility under 35 U.S.C. 101, the USPTO is extending
the period for public comment on the USPTO’s Patent Subject Matter Eligibility Interim Guidelines until June 30, 2006. The USPTO will publish a notice further extending the period for public comment on the USPTO’s Patent Subject Matter Eligibility Interim Guidelines if necessary to permit the comments to take into account the Court’s decision in LabCorp.

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U.S. Patent Examiners to Telework with Hoteling

According to Daniel Pulliam writing for on December 16, 2005, the U.S. Patent and Trademark Office plans to put 40 employees at a time through a two-week training course on telework starting in February 2006. The courses will continue until September 2006, when the number of trained employees is expected to top out at about 500, with 500 new telework arrangements added each year thereafter.

Once employees complete the training course, they will have access to an
online reservation system that will allow them to sign up by the hour for office
space on the agency's main campus.

The system, known as "hoteling," is set up so that for every three employees in the telework program, there will be one office space, which could be a standard cubicle or an actual office. Participants are expected to work in the office as little as one day a week, said Stewart Levy, director of the search and information resources administration under the USPTO's commissioner for patents.

When the first training program begins, there will be 20 office spaces available to teleworkers, Levy said. As more employees give up their office space in favor of working remotely, the program will recoup the extra space for the hoteling program.

Levy said he is fairly confident that the program will be a success because of the lessons learned by the trademark division, which began its own telework program about seven years ago. That division, which employs about 500 people, has about 190 employees working away from the office on a regular basis and hopes to increase that to 220.

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Archived updates for Tuesday, December 20, 2005

Problems with Multiple Priority Claims in the EPO

A novel theory of “exhaustion” of priority rights is found in an isolated European Technical Board of Appeal decision from April 2005 that denies priority to a second European application where a first European application claims priority to the same foreign parent application, even though both European applications are filed within one year of the foreign parent. According to the IPKat in July 2005:

The EPO Board of Appeal caused much consternation with its decision T0998/99 (OJ EPO 4/2005, 240), stating that "Article 87(1) EPC does not provide for the
possibility of filing several applications in respect of the same subject matter
and therefore of the same invention in one and the same country over the
priority period on the basis of a single priority document" (headnote 1). Most
observers thought that this concept of "exhaustion of priority" was against both
the letter and the spirit of the priority provisions of the EPC and the Paris

Fortunately, a recent decision T 0015/01-3.3.4 (relating to EP 0587780), restores sanity and states that: "The board concludes that the priority system of the EPC allow patent applicants to claim and enjoy the same priority right in more than one European application. The doctrine of exhaustion of priority rights is to be rejected."

A referral to the Enlarged Board of Appeal was considered, but rejected for the rather odd reason that "the board is not aware that the doctrine of exhaustion of rights has ever been applied or explicitly addressed in the first-instance practice of the EPO, or, with the exception of the of decision T 998/99, in the case law of the boards of appeal".

Although the IPKat notes that future boards of appeal can choose which decision to follow, Dr. Holger Glas, Dr. Andreas Dilg, and Ignaz Gall, of Maiwald Patentanwalts GmbH (, in Munich, Germany suggest in an APLF Update on December 19, 2005 that
"For the time being, to be on the safe side, special care should be taken when
claiming priority in proceedings before the EPO. Smart filing strategies might
include filing multiple priority-establishing applications or filing Divisional
Applications. Moreover, T 998/99 might even be advantageous for the opponent in
Opposition Proceedings to attack the effective date of an European Patent in
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WTO Meeting a Bust for I/P Issues

According to Tove Iren S. Gerhardsen writing for Intellectual Property Watch on December 18, 2005, "Trade ministers of the World Trade Organization members concluded their six-day intensive negotiation in Hong Kong with little progress on the biggest issues, and minimal work on intellectual property issues." More here.
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EPO Updates Cost Estimates for Sample European Patents

(excluding in-house preparation costs for the patentee)

According to a 2005 study by the European Patent Office, the total cost of a European (above) patent is estimated at approximately EUR 32 000. This amount comprises the fees for the EPO grant procedure, the costs of representation by a patent attorney before the EPO, the translation and validation costs and the renewal fees for maintenance of the patent in the six most-frequently designated countries -- Germany, the United Kingdom, France, Italy, Spain and Switzerland. However, the study notes that it should be borne in mind that "the actual patenting costs in an individual case may differ by more than 100 %, depending on the technological field."

For European patents filed by way of an application under the Patent Cooperation Treaty (PCT), known as "Euro-PCT patents" (below), applicants generally file in the six most frequently designated countries Germany, France, the United Kingdom, Italy, Spain and Switzerland, plus Netherlands and Austria. The total cost of this Euro-PCT sample patent is estimated at approximately EUR 47 000. This amount comprises the international PCT fees, the fees for the EPO grant procedure, the costs of representation by a patent attorney, the translation and validation costs incurred following the grant procedure and the renewal fees for maintenance of the patent in the designated countries.

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Archived updates for Monday, December 19, 2005

Canadian Industrial Designs Online

On December 6, 2005, the Canadian Intellectual Property Office (CIPO) announced the launch of the new Canadian Industrial Designs Database. Canadian industrial designs are now available on the web.

The initial phase includes approximately 10 000 designs registered as of June 15, 2002. New registrations will be added on a weekly basis. CIPO is currently in the process of completing the electronic back capture of the designs registered prior to this date and they will be added in Spring 2006.
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Free Teleseminar: Protecting Trademarks on the Internet

Thursday, January 05, 2006
1:00 PM EST to 2:00 PM EST
Register here

This session will address trademark issues associated with transacting business on the Internet, promoting goods and services online, and protecting brands against misuse in cyberspace. The presentation will examine representative caselaw and provide a discussion of strategic considerations for brand owners, including
  • Registration of domain names;
  • Domain names as trademarks;
  • Resolution of domain name disputes; and
  • Miscellaneous online trademark issues.

Kilpatrick Stockton's James Trigg will address these and related issues during the session.

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Archived updates for Friday, December 16, 2005

USTR Reports on Chinese I/P Protections

On December 11, 2005, the United States Trade Representative released its "2005 Report to Congress on China's Compliance" with the following conclusions about China's intellectual property system:

Overall, China’s efforts to bring its framework of laws, regulations and implementing rules into compliance with the TRIPS Agreement have been largely satisfactory, although some improvements, particularly in rapidly emerging areas such as Internet copyright protection, are still needed. Enforcement of these measures, however, remained largely ineffective in 2005, giving rise to increasingly strong concerns among U.S. industry. As one trade association representing the information technology sector explained, “[d]espite the Chinese government’s serious effort to begin addressing the piracy of intellectual property, the protection of [intellectual property] remains our industry’s chief concern in 2005. Indeed, the appropriation of intellectual property in China has occurred on such a massive scale that it has impacted international prices, disrupted supply chains, changed business
models, and probably permanently altered the balance between tangible and intangible values contained within commercial products. U.S. companies have had their [intellectual property] appropriated within China even without engaging with China through exports or investment, and many U.S. companies, particularly in the media and entertainment, see their copied products migrate into mainland markets even while the legitimate product remains barred by regulation.”

The United States made IPR enforcement its highest priority during the run-up to the high-level Joint Commission on Commerce and Trade (JCCT) meeting in April 2004. It strongly urged China in a series of high-level meetings in Washington and Beijing to take immediate action to put it on the path toward compliance with its critical TRIPS Agreement obligation to make available effective enforcement mechanisms. When the JCCT convened, China announced a comprehensive action plan on IPR enforcement, which included five major commitments, although China’s efforts to implement these commitments were mixed.

First, and most importantly, China agreed that it would significantly reduce IPR infringement levels. Nevertheless, IPR infringement in China remains rampant, and IPR infringement levels reported by U.S. industry have not improved.

Second, China committed that it would take steps by the end of 2004 to increase penalties for IPR violations by subjecting a greater range of violations to criminal investigation, applying criminal sanctions to the import, export, storage and distribution of pirated and counterfeit products and applying criminal sanctions to on-line piracy. China did take some steps to increase penalties for IPR violations, as China’s Supreme People’s Court and Supreme People’s Procuratorate issued a judicial interpretation in December 2004 redefining the criteria for commencing criminal prosecutions and reaching criminal convictions. Nevertheless, while this judicial interpretation has generated improvements, it did not address deficiencies in China’s criminal law still in need of correction.

Third, China committed to crack down on IPR violators by conducting nation-wide enforcement actions and increasing customs enforcement actions. Vice Premier Wu launched this crack down at the time of the Xiamen China International Fair for Investment and Trade in August 2004. However, a lack of transparency hinders an assessment of the disposition of any ensuing enforcement and customs actions. Official Chinese statistics are expected in early 2006.

Fourth, China committed to improve protection of on-line works by ratifying and implementing the World Intellectual Property Organization (WIPO) Internet-related treaties as soon as possible, and by extending an existing ban on the use of pirated software in government offices. Although China has not yet ratified the WIPO Internet-related treaties, the Chinese government did extend its ban on the use of pirated software in government offices.

Fifth, China committed to launch a national IPR education campaign. China followed through on this commitment by launching a national public awareness campaign to educate the Chinese public on IPR protection, which included radio and televison programs, newspaper inserts, awards and national and local level training programs. The campaign also included the introduction of a television program, “Intellectual Fortune,” which is broadcasted in 20 provinces nationwide, the publication of an English language insert in the China Daily English-language newspaper on intellectual property, and radio broadcast programs, among other targeted efforts. The long-term impact of these efforts is currently unclear.

In early 2005, the United States conducted an out-of-cycle review under the Special 301 provisions of U.S. trade law. This review involved a systematic evaluation of China’s entire IPR enforcement regime, supported by submissions from U.S. manufacturers and businesses to document IPR infringement to the extent possible. The review’s findings confirmed that China had not resolved critical deficiencies in its IPR enforcement regime, as IPR infringement remained at epidemic levels. In the results of this review, the United States elevated China to the Special 301 “Priority Watch” list and set forth a comprehensive strategy for addressing China’s ineffective IPR enforcement regime, which included the possible use of WTO mechanisms, as

The United States immediately began to pursue this strategy during the run-up to the July 2005 JCCT meeting, as the United States sought to strengthen the commitments that China had made at the April 2004 JCCT meeting and to obtain China’s commitment for greater involvement of its police authorities in IPR enforcement matters. China subsequently agreed to (1) increase criminal prosecutions for IPR violations in absolute numbers and also relative to the total number of IPR administrative enforcement cases, (2) reduce exports of infringing goods by issuing regulations to ensure the timely transfer of cases for criminal investigation, (3) improve national police coordination by establishing a coordinating group in the Ministry of Public Security responsible for overall research, planning and coordination of all IPR criminal enforcement to ensure a focused and coordinated nationwide enforcement effort, (4) enhance cooperation on law enforcement matters with the United States by immediately establishing a bilateral IPR law enforcement
working group focusing on the reduction of cross-border infringement activities, (5) expand an ongoing initiative to aggressively counter piracy of movies and audio-visual products, (6) complete its program ensuring that only licensed software is use by all central, provincial and local government offices by the end of 2005 and extend this program to enterprises in 2006, (7) fight software end-user piracy by declaring that it is considered to constitute “harm to the public interest” and therefore is subject to administrative penalties nationwide, (8) establish an IPR ombudsman in the Chinese embassy in Washington to assist U.S. companies, particularly small- and medium-sized companies, experiencing IPR problems, (9) develop measures to rid trade fairs of fake goods, (10) join the WIPO Internet-related treaties in 2006, and (11) clarify the December 2004 Judicial Interpretation to make clear that its
criminal thresholds apply to sound recordings and that exporters are subject to
independent criminal liability.

To date, China has already taken several steps to implement these commitments. Nevertheless, the overall results of China’s efforts remain unclear, largely because of transparency problems associated with IPR enforcement activities in China. For example, China will not make public enforcement decisions made by administrative authorities. China has issued statistics that appear to show some increase in enforcement activities, but there is no evidence of any corresponding reduction in IPR infringement levels.

In October 2005, the United States submitted a request to China under Article 63.3 of the TRIPS Agreement The United States’ request seeks detailed information from China on its IPR enforcement efforts over the last four years, as do similar requests submitted simultaneously by Japan and Switzerland. China’s response to these requests, anticipated in early 2006, will be a key test of whether it is serious about resolving the rampant IPR infringement found throughout China. The United States remains prepared to take whatever action is necessary and appropriate to ensure that China develops and implements an effective system of IPR enforcement, as required by the TRIPS Agreement.

In the trademark area, some progress was made in 2004 on the recognition of foreign well-known marks, more than a year after the issuance of implementing
rules on well-known marks, as a handful of foreign marks have been recognized as
well-known. In addition, in June 2005, the Trademark Administration circulated
draft amendments to its Regulations on the Timely Transfer of Suspected Criminal
Cases in the Enforcement of Administrative Law, which are designed provide
guidance to regional industrial and commercial administrations in facilitating
effective trademark enforcement and protection.

With regard to copyright protection over information networks, in November 2004, the National Copyright Administration of China and the Ministry of Information Industry (MII) jointly organized a hearing on draft implementing rules known as the Draft Measures for Administrative Protection of Copyright on the Internet. The Chinese authorities issued these rules in final form in April 2005. The rules require Internet service providers to take remedial actions to delete contents that infringe on copyrights upon receipt of a complaint from the right holder, or face administrative penalties ranging from confiscation of illegal gains to fines of up to RMB 100,000 ($12,000).

In September 2005, China circulated a more important Internet-related measure for public comment, the draft Regulations on the Protection of Copyright Over Information Networks. U.S. industry subsequently submitted written comments on the draft regulations, and China invited the United States to assist in organizing a meeting with U.S. and other foreign rights holders to discuss the draft regulations. The final version of the regulations is expected to be issued in 2006.

In furtherance of China’s April 2004 JCCT commitment to increase border measures protecting against the import and export of infringing products and to make it easier for rights-holders to secure effective enforcement at the border, the Customs Administration issued the Regulations on Customs Protection of Intellectual Property Rights, which went into effect in March 2004. The Customs Administration subsequently issued implementing rules for these regulations, effective July 2004. These regulations and implementing rules addressed the duties of the Customs Administration and improved guidance on the implementation of the customs IPR recordal mechanism. In other areas, however, the regulations and implementing rules lacked clarity or could have benefitted from further changes, such as with regard to the storage and disposition of infringing goods and the transferral of cases for possible criminal prosecution.

Meanwhile, in September 2004, the Customs Administration issued new regulations on administrative penalties in the customs context, the Implementing Regulations for the Imposition of Administrative Penalties by the General Administration of Customs, effective November 2004. In an apparent improvement over the prior regulations, these new regulations do not impose a “knowledge” requirement before penalties can be imposed. However, the new regulations provide for fines not to exceed 30 percent of the value of the goods confiscated, or RMB 50,000 ($6,000), whichever is lower. In contrast, the prior regulations allowed for fines up to the full value of the goods confiscated. The fines allowed under the new regulations are also lower than those imposed by other Chinese agencies focusing on domestic IPR infringement. At present, the effectiveness of these various regulations and implementing rules remains in doubt, as exports of counterfeit and pirated goods from China are increasing, facilitated by trading rights liberalization and the rapid growth of Internet usage and e-commerce.

The United States has urged China to pursue additional legislative changes to improve the legal framework supporting enforcement, particularly in the area of criminal enforcement. For example, the criminal enforcement legal framework could be improved through the removal of various evidentiary thresholds, the “for profit” requirement in the copyright area, the “identical trademark” requirement and the distinction between individual and enterprise liability. In addition, by not making retail sales of counterfeit and pirated goods subject to criminal penalties, and instead only making them subject to China’s largely ineffective administrative enforcement
system, China’s legal framework has created a “safe harbor” for retailers that operates to deprive the criminal enforcement authorities of needed information regarding the sources of counterfeit and pirated goods.

The United States also remains concerned about weaknesses in China’s legal framework that encourage or support counterfeiting and piracy. Some of these weaknesses have facilitated the establishment of Chinese companies under the false appearances of foreign companies, the squatting of foreign company names, designs and trademarks, and the theft of trade secrets. In addition, restrictions on market access for legitimate movies, music, software and books and built-in delays in the marketing approval system for pharmaceuticals have created incentives for counterfeiting and piracy that are difficult to address through the existing legal framework.

Nearly four years after China’s accession to the WTO, U.S. rights-holders uniformly report that IPR infringement in China remains rampant. Indeed, some trade associations report that the situation confronting U.S. rights-holders in 2005 remains unchanged from 2004. Other trade associations report that the situation has actually worsened. U.S. rights-holders uniformly urge the Chinese government to accelerate its reforms in order to significantly reduce IPR infringement levels. This situation not only has had an enormous economic impact, but also presents a direct challenge to China’s ability to regulate many products that have health and safety implications for China’s population and, as an increasing amount of counterfeit and pirated products are being exported from China, for others around the world.

The three different mechanisms for IPR enforcement created by China’s IPR laws and
regulations – enforcement by administrative authorities, criminal prosecutions and civil actions for monetary damages – are examined below. As the United States and other WTO members have been urging, China needs to take immediate steps to improve each of these enforcement mechanisms,particularly criminal enforcement, in line with the minimum standards for IPR enforcement established by the TRIPS Agreement.

China continues to take a large number of administrative enforcement actions against IPR violators. However, they are not having a deterrent effect. Although the central government continues to promote periodic anti-counterfeiting and anti-piracy campaigns, and these campaigns in the short term result in high numbers of seizures of infringing materials, they are largely ineffective. For one thing, the cases subsequently brought by the administrative authorities usually result in low fines. When the administrative authorities decide on fines, the fine amounts are kept artificially low because many administrative authorities do not treat the infringing goods as having the value of the genuine articles, but rather establish value based on the price charged for the counterfeit or pirated goods. In addition, evidence showing that a person was caught warehousing infringing goods is not sufficient to prove an intent to sell them, and as a result the administrative authorities will not
even include those goods in the value of the infringing goods when determining the fine amounts.

The lack of deterrence from the fines is compounded by the fact that the administrative authorities rarely forward an administrative case on to the Ministry of Public Security for criminal investigation, even for commercial-scale counterfeiting or piracy. Statistics provided by China confirm this fact. In 2004, according to these statistics, only 96 out of 51,851 administrative trademark cases (approximately 0.2%) and 101 out of 9,691 administrative copyright cases (approximately 1.0%) were transferred for criminal prosecution. These statistics showed no improvement over 2001, when the corresponding statistics similarly indicated very low transfer rates of 0.2% for administrative trademark cases and 1.5% for administrative copyright cases. As a result, the infringers continue to consider the seizures and fines simply to be a cost of doing business, and they are usually able to resume their operations without much difficulty.

China’s administrative enforcement efforts have also failed to put an end to open and notorious IPR infringement at trade fairs, retail markets and wholesale markets throughout China. The United States has urged China to step up efforts at retail markets such as the “Silk Street” market in Beijing and wholesale markets such as Xiangyang in Shanghai, Yiwu in Yiwu City, and Lowu in Shenzhen. At major trade fairs, exhibitors displaying infringing goods in the past have escaped with only non-deterrent administrative penalties. China pledged to address the trade fair problem as part of its July 2005 JCCT commitments, and it is expected to issue final measures designed to improve administrative IPR enforcement at trade fairs, including provisions enhancing on-site complaint centers at major fairs, by the end of 2005.

In the view of the United States and U.S. industry, the most critical steps for China to take in improving its IPR enforcement are in the criminal area. Effective criminal enforcement is a core WTO obligation, and it offers the deterrence needed for China to begin to handle the rampant IPR infringement hurting both foreign and domestic enterprises. For this reason, the United States sought and obtained at the April 2004 and July 2005 JCCT meetings commitments by China to apply criminal sanctions to a wider range of IPR-infringing activities, to increase the penalties for IPR violations, to increase the number of criminal prosecutions for IPR violations, to reduce exports of infringing goods through the timely transfer of cases for criminal investigation, to improve national police coordination, and to ensure that its criminal thresholds apply to sound recordings and that exporters are subject to independent criminal liability.

At present, although the number of criminal prosecutions has increased, criminal prosecutions remain relatively low in relation to administrative cases, and they have not created an adequate deterrent for IPR infringers. U.S. companies also continue to complain that, in most regions of China, the police are either not interested in pursuing counterfeiting and piracy cases or simply lack the resources and training required to investigate these types of cases effectively.

Moreover, even when IPR violations are referred for criminal enforcement, the actual prosecution of IPR crimes frequently requires coordination among a relatively large number of agencies at the national and local levels. Coordination remains problematic, however, with different agencies using different standards to determine whether criminal conduct exists and some agencies apparently unwilling or unable to work together.

In part because of the ineffectiveness of the administrative and criminal enforcement mechanisms in China, particularly in the copyright area, there has
been an increase in the number of civil actions being brought for monetary damages or injunctive relief. Most of the civil actions have been brought by Chinese rights-holders. This increased use of civil actions has coincided with an increasing sophistication on behalf of China’s IPR courts, as China continues to make efforts to upgrade its judicial system. These efforts are still in progress, however. U.S.
companies still complain about local protectionism and have also found that most judges lack necessary technical training and that court rules regarding evidence, expert witnesses, and protection of confidential information are vague or ineffective. In addition, in the patent area, where enforcement through civil litigation is of particular importance, a single case still takes several years to
complete, rendering the damages provisions adopted to comply with China’s TRIPS Agreement obligations less meaningful.

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Dubious Domain Name Defenses from the WIPO Archives

Kudos to Kevin Shay at for finding "close to 100 cases culled at great personal expense from the WIPO archives where you’ll see some of the outlandish ways people have tried to convince an Administrative Panel they have a right to a domain name," such as

Case: D2000-0308
Complainant: The University of Oxford
Respondent: DR Seagle
The Defense: "My name is Oxford University."

Case: D2000-1638
Complainant: Koninklijke Philips Electronics NV
Respondent: Ramazan Goktas
The Defense: "Mr Goktas alleges that the name "Philip" is generic and that it is unreasonable for Philips to seek to monopolise it. . . . In a somewhat contradictory fashion, he also argues that he intended to use the name for a [nonprofit?] travel site based on the trading title 'Philip’s Organisation'."

and . . .

Case: D2002-0718
Complainant: ABB Asea Brown Boveri Ltd
Respondent: Yvonne Bienen, Bienen Enterprises
The Defense: "Mr. Ekman says that he attempted to create a website and association for people who appreciate women's 'breasts and derrieres'. The name of the site was "World Wide Web Association of Breasts and Buttocks."

If you come across any amusing WIPO UDRP decisions, then please send them to Kevin via bergerber [AT] staggernation [DOT] com.
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TGIF for the Top Ten Living Inventors

Here, for the first time, is a complete list of the 10 most-prolific living inventors from Kevin Maney at USA Today on December 13, 2005. "For decades, the popular assumption has been that Thomas Edison is the all-time patent king with 1,093 patents," writes Maney. But Shunpei Yamazaki of Japan, "blows away Edison" with 1,432 patents. Interestingly, number 5, 6, and 7 "all work for Micron Technology in that great mecca of American invention, Idaho" (even if you don't count utility patents).

James Delong's favorite is 2d placer, Donald Weder of Illinois, who has 1,322 patents on "making flower pots, bundling flowers, and other floristic esoterica."

Esther Takeuchi, who works on battery research for Greatbatch, is certainly one of the most-prolific but not yet top ten female inventors with 126 patents.

Want more?

Click here for the top ten African-American inventors from Scholastic. Click here for the ten most-poular inventions from Mary Bellis. Click here for the top ten most-wanted patents from EFF. Click here for the top 10 things you should know about patents from BIOS. Click here for the top ten patent practice tips from the HIPLA. Click here for the top ten patent drafting tips from Judge Michel. Click here for the top ten patent assignees. Click here for the top ten patent-receiving universities. Click here for the the top ten things to do about your competitors' intellectual property.

Thank Goodness It's Friday (and you're reading a top ten blawg),

--Bill Heinze
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Archived updates for Thursday, December 15, 2005

Why "Just Get Me a Patent" Doesn't Work

Any good patent attorney knows that they can get a patent on almost any invention. Unless every feature of the invention is disclosed in a single "prior art" reference, then the Patent Examiner will be forced to come up with a reason as to why one of ordinary skill in the art would have had a reason to combine features from different references in order arrive at the invention. Since the Examiner is very unlikely to have gone to law school, much less tried to keep up with the latest court decisions on so-called "inventive step," then any lawyer worth their salt can almost always come up with a plausible argument as why the Examiner's combination of references is improper and the patent application should be granted.

Mind you, this is not the fault of the Patent Examiner. They are paid to simply follow the Office's Manual of Patent Examining Procedure and fulfill their examination production quotas. Besides, it's not always that easy for the attorneys who represent inventors either. In fact, beleive it or not, I once heard a partner at a large patent boutique say that they rarely challenge a rejection for lack of inventive step because they are rarely ever successful.

If it is really that easy to get a patent (and for a good attorney it is), then the real question for clients to ask themselves is whether the scope of protection that a patent might provide is worth the cost. But isn't that true for all business assets? Aren't managers are always asking themselves whether the money they spend will increase the value of their business by a larger amount. And if successful businesses don't spend money on non-performing assets, then why should they spend money on securing a patent that will never present a real threat being enforced?

Of course, the other way to look at patents is as just another legal expense under the "cost of doing business." Under this approach, some clients will decide that they need a certain numbers of patents. And most patent attorneys will gladly oblige. It doesn't matter what the patents cover, or whether the client would ever want to enforce them. After all, just getting a patent is a lot easier to bill for than trying to learn your client's industry well enough to teach your client what they need to know about the patent system in order to determine the value of a patent to their business.

Sure, the client can always come up with some justification for their magic number theory. "Those patents will showcase the value of our engineering," they say. "If we get enough patents, one of them is bound to be a grand slam," or "No one would dare sue us if we have enough patents of our own." Besides, "aren't patents way too difficult to enforce anyway?" And, of course, they're right, at least until somebody actually bothers to read their patent claims. (I have found that it usually takes about three minutes for me to review a patent with a client in order to confirm that my client does not have any products that infringe).

This may all be good for patent attorneys and inventors. But is this approach really good for the patent system? Is it good for society?

If I call a doctor with a headache and say that I want a CAT scan just to make that nothing is wrong, I'm not going to get it. The doctor is going to tell me to first come in for an examination, and prior art examinations are to patent applications what physical examinations are to medical diagnosis. Without one, there is no way to tell what, if anything, may be appropriate for the invention or the patient.

Nonetheless, some clients will insist that their inventors know so much about the prior art that prior art examinations are simply a waste of money. (I tried a similar line on my doctor once, and guess what it got me.) Besides, who's a patent attorney to argue. The attorney will almost certainly make more money re-writing the application after all of the claims are rejected, than they would have made from the prior art search. And the inventor will get at least one more shot at getting another patent notch on their belt.

Of course, no one ever dies from a poor prior art examinination. But I have seen a few small fortunes pissed away on useless patents. Besides, medical/prior art examinations are also serve other important functions. They put the doctor/attorney in a much better position to explain the prognosis for a particular treatment/prosecution regime. Of course, some patients/clients don't want that level of detail, and some doctors/attorneys may think that's not what they are being paid for. But aren't both professions obligated to explain the risks, benefits, and likely outcomes of their work? Aren't we obligated to use our skills in only the best interest of the patient/client?

So don't call me and say "just get me a patent." I'm likely to tell you that you need an examination, talk to you about cost, benefits and likely outcomes, and I might even tell you that there is nothing more that the patent system can do for you.
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Internet Sources for Intellectual Property Case Law

This website from the World Intellectual Property Organization lists links to publicly and freely accessible online databases that contain, exclusively or partly, court decisions or decisions of administrative bodies in the field of intellectual property law, or extracts of such decisions. The compilation is based on information submitted to WIPO by participants of the IPEIS Forum as well as by the International Bar Association Intellectual Property and Entertainment Law Committee.

Databases are listed irrespective of the language in which they are maintained. To further develop the compilation, participants of the IPEIS Forum are invited to submit to the Secretariat any additional relevant information.
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Archived updates for Wednesday, December 14, 2005

Improving Innovation Success Rates

In "Spurring Innovation Productivity" James P. Andrew and Kermit King of The Boston Consulting Group identify three broad options for boosting net present value on innovation:
  1. increasing the potency of ideas,
  2. lowering the cost of commercialization, and
  3. improving the success rates.

"Few of our benchmark clients suffer from a scarcity of potent ideas," they write. "Mathematically, each percentage-point improvement in a success ratio will have a much greater impact on NPV than a proportional improvement in controllable cost. The greatest gain, then, comes to companies that concentrate on improving their innovation success rates."

They suggest that businesses start by assembling a straightforward catalog of innovation projects undertaken over the past three to five years, including the source of the idea (external, marketing, or R&D), the type of innovation (maintenance, extension, or breakthrough), the budgeted and actual investment, in terms of both money and allocated personnel, the termination date or time to market launch, the incremental sales and contiribution planned or realized, and the implied returns. Using these metrics, their clients typically find that

  • Investment dollars and project mix tend to be skewed toward small-increment product extensions rather than breakthroughs.
  • Areas of heavy investment are often the least productive.
  • External sources for ideas deliver higher returns.
  • Termination rates for unsuccessful projects are too low.
  • Unfocused budgeting criteria often lengthens payback.
  • Actual prioritization of projects is sporadic.

Using this historical information, an organization can then develop an effective innovation strategy that avoids the following traps they have observed in their work:

The Denominator Trap: Many companies greatly overestimate their ability to access and switch out a competitor's installed base, and they therefore include that entire base in their estimates of market size.

The Sustanability Trap: Companies often fail to include in their launch plans the costs of sustained support, multiyear promotion, and desired pricing moves. When a new product comes up for a second year of support, it is often the first budget line to be cut.

The Suhstitution Trap: Because innovation can succeed at the expense of existing products, screens must estimate cannibalization as objectively as possible.

The Uniformity Trap: No two new-product launches are identical.

The Tactical Trap: Innovations must be assessed in their full strategic context. Less obvious credits and costs, though material, can easily escape inclusion in a company's analysis of launch economics.

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EU Database Protection Directive Under Review

On December 12, 2005, the European Commission published an evaluation of the protection EU law gives to databases. The evaluation concludes that the economic impact of the “sui generis” right on database production is unproven. However, it also notes that the European publishing industry consulted in the online survey beleives that “sui generis” protection is crucial to the continued success of their activities. In addition, most respondents to the associated online survey believe that the "sui generis" right has brought about legal certainty, reduced the costs associated with the protection of databases, created more business opportunities and facilitated the marketing of databases.

The study concludes with an elightening examination of four policy options:
  • Repeal the whole Directive
  • Withdraw the “sui generis” right
  • Amend the “sui generis” provisions
  • Maintaining the status quo

The staff working paper invites stakeholders to submit their views, comments, and vidence on the economic impact of "sui generis" protection, by 12 March 2006 to The evaluation is available online

The European Directive on the legal protection of Databases was adopted in February 1996 and has now been implemented into the legislation of the 25 Member States and the EFTA. It created a new exclusive 'sui generis' right for database producers, valid for 15 years, to protect their investment of time, money and effort, irrespective of whether the database is in itself innovative ("non-original" databases).

According to the Commission evaluation, interpreting the precise scope of the “sui generis” right has proven difficult, especially as no jurisdiction had a comparable legal instrument prior to the introduction of this new form of protection. The “sui generis” provisions have thus caused considerable legal uncertainty, both at the EU and national level. In addition, the scope of the provision was severely curtailed in a series of judgments rendered by the ECJ in November 2004. This has, at least with respect to producers of databases that “create” the data and information that comprises their databases, decreased the protection for “non-original” databases.

The report goes on to conclude that although it was introduced to stimulate the production of databases in Europe, the “sui generis” protection has had no proven impact on the production of databases. According to the Gale Directory of Databases, the number of EU-based database
“entries” was 3095 in 2004 as compared to 3092 in 1998 when the first Member States
had implemented the “sui generis” protection into national laws:

In fact, the number of database “entries” dropped just as most of the EU- 15 had implemented the Directive into national laws in 2001. Nevertheless, the European publishing and database industries claim that “sui generis” protection is crucial to the continued success of their activities. 75% of respondents to the Commission services’ on-line survey are aware of the
existence of the “sui generis” right; among these, 80% feel “protected” or “well
protected” by such right. 90% believe that database protection at EU level, as opposed
to national level, is important and 65% believe that today the legal protection of
databases is higher than before harmonisation.

Most respondents to the on-line survey also believe that the “sui generis” right has helped
Europe to catch up with the US in terms of investment but, at the same time, that the
“sui generis” right did not help to significantly improve the global competitiveness of the
European database sector. The data taken from the GDD reveal that the economic gap
with the US has not been reduced.

"While this endorsement of the “sui generis” right is somewhat at odds with the continued
success of US publishing and database production that thrives without “sui generis” type
protection, the attachment to the new right is a political reality that seems very true for
Europe," write the autors of the study.
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Archived updates for Tuesday, December 13, 2005

Biax Requests Exclusion of Imports by Philips

On March 15, 2005, Biax Corporation filed a "Section 337" unfair import complaint at the U.S. International Trade Commission.

The complaint requests that an unfair import investigation be instituted involving "Digital Processors, Digital Processing Systems, Components Thereof, and Products Containing Same." The proposed respondents are Philips Semiconductors B.V. (Netherlands); Philips Consumer Electronics Services B.V. (Netherlands) and Philips Consumer Electronics North America Corporation (USA). The complaint has been designated as confidential and assigned Docket No. 337-2459 for indexing in the Commission's database.

The Commission now has 30-35 days from the filing date of the complaint in which to decide whether to institute the investigation. Upon institution, the proposed respondent will be served with the Complaint via postal mail and an Administrative Law Judge will schedule discovery, conduct a trial, and issue a written "Initial Determination," usually within about 10 months. Due to the expedited nature of these proceedings, and availability of general exclusion orders affecting non-parties, it is important to notify any potential importers of similar products as soon as possible.

Click here for more information on the importance of monitoring these ITC investigations, and click here for an audio-visual Internet presentation on "Unfair Import Investigations at the U.S. International Trade Commission."

For the latest details on a particular Section 337 investigation, or to arrange an in-person presentation on these (and/or other) intellectual property topics, contact Bill Heinze (, at Thomas, Kayden, Horstemeyer & Risley in Atlanta, Georgia.
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EU Implementing Compulsory Drug License Regime for Exports

The European Union will allow companies in the EU to apply for a licence to manufacture, without the authorisation of the patent holder, pharmaceutical products for export to countries in need of medicines and facing public health problems. The move follows domestic law changes in Canada, Norway, India and China.

According to the press release from the European Commission, there is no specific restriction on the pharmaceutical products covered, although there is acknowledgement that they are required to address public health problems since that is the context of the Decision. The text of the Regulation will be adopted shortly after finalisation by legal and linguistic experts and enters into force on the 20th day after publication in the Official Journal (see IP/04/1332).

According to the IPR Helpdesk, the manufacturing and exporting of generic medicines to poor countries would be permitted through the use of compulsory licences which will be granted by the national authorities. The regime for granting the compulsory licences of exporting is different in every EU Member State, thus needing to be harmonised through the adoption of a EU document. This is the reason why the Commission proposed this new Regulation, the European Community having committed to fully contributing to the implementation of WTO?s Decision.

In order to ensure exported products reach those who need them and are not further re-imported, the Commission's proposal prohibits re-importation of the concerned products into the European Community and gives customs authorities the capacity of taking action against goods being re-imported.
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Rothman on Initial Interest Confusion

Courts have used the initial interest doctrine to hold that defendants have committed trademark infringement even when no one is ever likely to be confused by the use of the trademark. Instead, courts have allowed findings of trademark infringement solely on the basis that a consumer might initially be “interested,” “attracted,” or “distracted” by a competitor’s, or even a non-competitor’s, product or service. In "Initial Interest Confusion: Standing at the Crossroads of Trademark Law," Jennifer E. Rothman of Washington University in St. Louis argues in Cardozo Law Review, Vol. 27, p. 105, 2005 that the initial interest confusion doctrine must be eliminated and trademark infringement returned to its origins as a narrow cause of action primarily directed at protecting consumers from deceptive business practices:

Initial interest confusion is such an excess, and one which, despite
violating the express terms of the Lanham Act, thus far has been extremely
successful. It is time for courts to revisit the doctrine. Each court of appeals
has the ability to reject initial interest confusion and to embrace in its place
the more limited analysis of “pre-sale confusion”— arefully limiting actionable pre-sale confusion to situations in which there is likely confusion by reasonably prudent potential purchasers that exists prior to the time of sale and such confusion is more than de minimis.

Congress should also take heed of the policy reasons why we should not
punish “initial interest” absent likely confusion. Even if courts do eliminate
the errant initial interest confusion doctrine, it is likely that powerful
trademark holders will try to codify the doctrine back into the law. In recent
years, Congress has been heavily lobbied by some of the most powerful
intellectual property groups and has codified more and more expansions of
intellectual property laws at the expense of the public and smaller businesses.
Such efforts should be rebuffed with regard to initial interest confusion since
the doctrine flies in the face of the justifications for trademark protection
and the Lanham Act, and raises serious conflicts with the First Amendment and
other intellectual property laws.

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Archived updates for Monday, December 12, 2005

I/P Documentary from University of Richmond

On November 18, 2005, the National CyberEducation Project of the University of Richmond I/P Institute premiered "What Do You Think?", a new documentary on intellectual property and file-sharing to be used as part of their Copyright Roadshow.
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PCT Newsletter Highlights for December 2005

Here are some highlights from the December 2005 PCT Newslettter available at

Non-Working Days at the International Bureau for 2006

For the purposes of computing time limits under PCT Rule 80.5, the days on which the International Bureau (IB) will not be open for business are, for the period from 1 January to
31 December 2006, the following:

All Saturdays and Sundays, and
2 and 10 January 2006
14 and 17 April 2006
25 May 2006
5 June 2006
1 August 2006
7 September 2006
25 and 26 December 2006

Signatures for Entry into the National Phase in Germany

The German Patent and Trade Mark Office has deleted the following special requirement under PCT Rule 51bis for entry into the national phase before it as designated and elected Office:
furnishing of confirmation of the international application by the signature of any applicant who has not signed the request.

Evidence of Mailing to the European Patent Office

There have been changes in the requirements of the European Patent Office (EPO) as to the acceptability of evidence of mailing of a document, in case of loss or delay, where a delivery service other than the postal authorities is used; it will now accept such evidence provided provided that the delivery service is: Chronopost, Deutsche Post Express, DHL, Federal Express, LTA, TNT, SkyNet or UPS.

Biological Depository in Spain

The following depositary institution has acquired the status of international depositary authority under the Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure, with which deposits of microorganisms and other biological material may be made:

Banco Nacional de Algas (BNA)
Marine Biotechnology Center
University of Las Palmas, Gran Canaria
Muelle de Tailiarte s/n
35214 Telde
Las Palmas, Spain

Video Presentation in Japanese

A new video presentation in Japanese is available on the PCT website. The video, featuring Toshiaki Nakamaki, Counsellor, PCT External Relations Division, was made on 28 July 2005 at a PCT seminar in Japan. It can be downloaded or viewed online in two different
formats, depending on your connection speed, at

Table of Time Limits for Entering the National/Regional Phase

The table of time limits for entering the national/regional phase under PCT Chapters I and II, as updated on 17 November 2005, is now available in English and French at, respectively: and

Power of Attorney Waivers

The table showing the PCT Office/Authorities which have notified WIPO that they have waived the requirement to submit a power of attorney under PCT Rule 90.4(b) and/or Rule 90.5(a)(ii) has been updated and appears on pages is available on the PCT website at

Table of Reservations and Incompatibilities

The table containing all PCT reservations and incompatibilities was updated on 17 November
2005, in English, French, German and Spanish, and is available at, respectively:
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