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Archived updates for Friday, October 27, 2006

TGIF for a Change

U.S. Patent No. 6,826,983 to Thomas Magdi
for "Light Bulb Changer"

What Is Claimed Is:

1. A light bulb changer apparatus, comprising:
means for immediately detecting a burned out condition in a light bulb;
means for automatically removing the burned out bulb upon; and
means for automatically replacing the burned burned out bulb with a replacement bulb, wherein the detecting means, removal means, and replacing means occurs automatically in succession without human intervention.
Thank Goodness It's Friday (and I've got plenty of stress reducing means for intellectual property counsel replacement and referrals),

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Cert. Petition Granted in Microsoft v. AT&T

On October 27, 2006, the U.S. Supreme court granted Microsoft's petition for a writ of certiorari in Microsoft Corp. v AT & T Corp., No. 05-1056, proceedings below, AT&T Corp. v. Microsoft Corp., 414 F.3d 1366 (Fed. Cir. 2005). The questions presented in Microsoft's Brief are:

"(1) Whether digital software code – an intangible sequence of ‘1's’ and ‘0's’ – may be considered a ‘component[] of a patented invention’ within the meaning of Section 271(f)(1); and, if so,
"(2) Whether copies of such a ‘component[]’ made in a foreign country are ‘supplie[d] ... from the United States.’"
According to Harold C. Wegner, author of "A Foreign Square Peg in a Domestic Round Hole: The Eolas-AT&T-Carbide Trilogy," Hot Topics in Patent Law, George Mason University School of Law, July 18, 2006, Arlington, Virginia (available at, in asking for grant of certiorari, the United States government stressed the anti-American result of the Federal Circuit’s decision has on the domestic software industry:

Under the court of appeals’ decision, companies that design software in the United States cannot distribute their software abroad without running the risk that they will be compelled to pay royalties under United States patent law with respect to all of their foreign sales. Their foreign competitors, by contrast,
run no such risk of global liability under United States law, because they are exempt from application of Section 271(f) with respect to their foreign conduct.

As a result, United States software companies will find themselves at a substantial competitive disadvantage in foreign markets, and may even be foreclosed from competing in those markets altogether. That disadvantage will harm the software sector of the American economy and could ultimately compel
some software companies to relocate their research and development operations abroad. Moreover, the logic of the court of appeals’ decision could be extended to other high-technology industries.

More links at Dennis Crouch's Patently-O Blog.
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FYI on USPTO Petitions Branch Backlog

This just in from Bob Bell on October 26, 2006:
The Petitions Examiner told me that as of January 2006, they have "taken over" all petitions responsibilites form the groups. Formerly, simple petitions, like a Petition to Withdraw, were handled by the Group Director, or even the SPE. Now EVERYTHING goes to Petitions Branch. She said that they are still working on Petitions from 2005. It is backed up.
More on "Petitions Practice within the USPTO on Patent Matters."
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Archived updates for Wednesday, October 25, 2006

Paul Cole's "Fundamentals of Patent Drafting"

"Fundamentals of Patent Drafting" by Paul Cole brings together the papers of numerous patent attorneys that take account of the impact of many cases in the UK, Europe, and US. Each chapter begins with a short summary and list of skills to be developed by each chapter. While the collection is a bit disjointed for an easy read, it does provide an excellent starting point for compartive study of various patent issues on each side of the Atlantic.
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Archived updates for Tuesday, October 24, 2006

Court Defines Procedure for Determining Arbitrability

In Qualcomm Incorporated, et al. v. Nokia Corporation, et al. (October 20, 2006), the Federal Circuit considered what inquiry the district court should perform in order to be "satisfied" under section 3 of the Federal Arbitration Act as to the arbitrability of an issue before ordering a stay.

Section 3 of the Federal Arbitration Act, 9 U.S.C. § 3, provides:
If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, providing the applicant for the stay is not in default in proceeding with such arbitration.
The Federal Circuit concluded that, in order to be "satisfied" of the arbitrability of an issue pursuant to section 3 of the FAA, the district court should first inquire as to who has the primary power to decide arbitrability under the parties’ agreement.

If the court concludes that the parties clearly and unmistakably intended to delegate the power to an arbitrator, then the court should also inquire as to whether the party’s assertion of arbitrability is "wholly groundless." If, however, the court concludes that the parties did not clearly and unmistakably intend to delegate arbitrability decisions to an arbitrator, the general rule that the "question of arbitrability . . . is . . . for judicial determination" applies and the court itself should then undertake a full arbitrability inquiry in order to be "satisfied" that the issue involved is referable to arbitration.

In this case, the parties clearly and unmistakably intended to delegate arbitrability questions to an arbitrator as evidenced by their incorporation of the AAA Rules into the 2001 Agreement. The remaining question is whether Nokia’s assertions that its estoppel and license defenses "aris[e] out of or relat[e] to" the 2001 Agreement are "wholly groundless." On remand, the court should not undertake to determine whether Nokia’s assertions are in fact arbitrable, but rather should merely determine whether Nokia’s assertions of arbitrability under the 2001 Agreement are "wholly groundless" and, if not, stay the trial of the action to permit an arbitrator to rule on the arbitrability of those issues.

Accordingly, we vacate the district court’s March 14, 2006 Order with respect to its denial of Nokia’s motion to stay and remand to the district court.

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USPTO Webcast on Accelerated Examination

Thursday, November 2, 2006
2 p.m. Eastern / 11 a.m. Pacific
Free Registration at

During this live one-hour web cast event, USPTO personnel will review important components of AE including:

  • The benefits to the applicant
  • New requirements to make special which apply to all patent applications
  • New processing and examination procedures
  • Additional information required by the new AE process
  • Accelerated response time mandated by the process
  • Brief review of how to file under the new program using EFS-Web

The presentation and audio for this event will be streamed to you over the internet. All you will need to participate is a computer with an internet connection, sound card, speakers and the ability to view Windows Media presentations.

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Archived updates for Monday, October 23, 2006

REBEL Generic for Variety of Grass Seed

In In Re Pennington Seed, Inc. October 19, 2006, the Federal Circuit agreed with the USPTO that the varietal name "Rebel" is generic and hence is not entitled to trademark registration.

Instructive to our holding is the decision in Dixie Rose. Although that decision of the District of Columbia Circuit is not binding on our court, we find its reasoning persuasive. In Dixie Rose, an applicant had patented a new variety of rose and had sought to register the term "Texas Centennial" as a trademark for the rose. 131 F.2d at 446. The Commissioner of Patents refused registration of the proposed term on the ground that it was the name of the variety of the rose. The Commissioner reasoned that the term "Texas Centennial" was "one of a hundred varieties of hybrid tea rose listed in applicant’s catalog of record, each bearing its own distinctive name. . . . Each is the name of a particular type, style, or variety of rose, and would be likely to convey no other meaning to purchasers." Ex parte Dixie Rose Nursery, 45 U.S.P.Q. 673 (Comm’r Pats. 1940). The district court refused to authorize the Commissioner to register the proposed term. On appeal, the District of Columbia Circuit affirmed, reasoning that the rose variety was "known throughout the trade, and listed in appellant’s catalog by this name. Purchasers call for it, and for no
other variety, by this name." Dixie Rose, 131 F.2d at 446. Thus, the court determined that the PTO and district court "might properly conclude that the words ‘Texas Centennial,’ though originally arbitrary, have come to describe to the public a rose of a particular sort, not a rose from a particular nursery." Id. at 447. The
court further reasoned that words which are descriptive cannot be registered, even when an "applicant and his licensees are, for the moment, the only persons who produce the thing described." Id.

. . . It is well-established that an applicant cannot acquire trademark protection for
the generic name of a product. See Goodyear’s Rubber Mfg. Co. v. Goodyear Rubber Co., 128 U.S. 598, 602 (1888) ("names which are thus descriptive of a class of goods cannot be exclusively appropriated by any one"); Weiss Noodle Co. v. Golden Cracknel & Specialty Co., 290 F.2d 845, 847 (C.C.P.A. 1961) ("no one can be granted the exclusive use of the name of an article"); BellSouth Corp. v. DataNational Corp., 60 F.3d 1565, 1569 (Fed. Cir. 1995) (the generic name of a product "cannot inform the public that the product has a particular source"). Similarly, in this case, the examiner determined that the evidence demonstrated that the term "Rebel" was the varietal name for the grass seed and was the seed’s generic designation.

We see no reason to disturb the examiner’s finding, as substantial evidence in the record supports his determination that "Rebel" is a varietal name and is thus generic. The evidence consists of excerpts of articles from a variety of sources, including one from the Germplasm Resources Information Network web server, wherein "Rebel" is listed as a cultivar name for tall fescue grass seed, an excerpt from the database maintained by UPOV listing "Rebel" as the denomination of a tall fescue variety, and an excerpt from a listing on plant varieties kept by the Seed Regulatory and Testing Branch of the United Statues Department of Agriculture.

The evidence thus demonstrates that the term "Rebel" is the name of a variety of grass seed and as such is the variety’s generic designation. There is in fact no evidence in the record to suggest that the asserted mark functions as a source
indicator, rather than as a name for a particular grass seed. Thus, substantial evidence supports the Board’s finding that the term "Rebel" is the name of a variety of grass seed and is its generic designation. The reasoning underlying the PTO’s decision to refuse registration of a varietal name is not, as Pennington argues, inconsistent with the public interest. When an applicant seeks protection of its grass seed, the applicant is required to name its developed variety. Applicant here decided to name its variety of grass seed "Rebel" and that name was disclosed in the PVP certificate, designating to the public the name of the variety of grass seed. Just as in Dixie Rose, that variety of grass seed became known throughout the trade by the name "Rebel" and is listed in applicant’s catalog by that name. When a purchaser asks for that particular type of grass seed, he has no other name to use but its designated name. The purchasing public only has the term "Rebel" to refer to this particular product. . . .

We do not of course hold that an applicant is precluded from acquiring trademark protection for a particular variety of grass seed. If an applicant wishes to establish trademark protection for its variety of grass seed, it can do so by associating a particular brand name with its grass seed. However, having designated the term "Rebel" as the varietal name for grass seed and having failed to associate any additional word with the Rebel grass seed that would indicate the seed’s source, Applicant here is prohibited from acquiring trademark protection for the generic and only name of that variety of grass seed. This situation may be contrasted with pharmaceutical products where a generic name is designated for a new pharmaceutical product and its manufacturer associates it with a brand name. For example, ibuprofen is the generic term designated for a particular nonsteroidal anti-inflammatory drug and ADVIL is a brand name indicating a source of the drug. Trademark protection does not inure to the generic name there and it does not do so here.

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I/P Updates in the News

"IBM Files Amazon Patent Suits" by Scott Martin of Red Herring
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P2Patent System to Launch in 2007

According to Andrew Noyes writing for on October 19, 2006, a yearlong test of the Community Patent Review Project will begin accepting about 200 patent applications from IBM, Intel, Microsoft, Oracle, and others that will get "moved to the front of the line" for review. The project schedule calls for the "p2patent system" to be "tested and soft launched on published patents" in January of 2007 with formal reviews beginning in April 2007.

Until then you can hear from the project sponsors on "how the system will work, why patent applicants and their lawyers should submit applications and why scientists, engineers and legal professionals should get involved as peer reviewers," in an online chat at the State of Play Academy on Monday, Oct 30 at 2:30 EST.

The Community Patent Review project team will also "initiate discussions of technical system architecture in the next couple weeks." The initial topic will be establishing a candidate technical architecture that supports the project specification (use cases). To signup for the developer list where this discussion will occur, click the following link

Here is what is currently planned for the USPTO 2007 Pilot in Phase 1 of Community Patent Review:

  1. Application is published on the p2patent web site and available for comments for a 4 month time period. This time period is designed to inform rather than compete with or delay substantive examination.
  2. Electronic notifications of the new application's availability go out to the peer review community by means of electronic subscription.
  3. Peer reviewers invite more experts to subscribe and participate.
  4. Peer reviewers can search and find applications of interest.
  5. Peer reviewers can associate tags or keywords with applications or prior art, so that they are easier for the community to find in the future.
  6. Visualization aids reveal web site activity and make the Community Patent peer review community visible to itself. Such aids might include visualizations of the number of applications and which applications have the most comments.
  7. Once registered, peer reviewers can: 1) rate claims, 2) submit prior art examples, 3) comment on the patent or on specific prior art submissions, 4) rate prior art submissions, 5) rate prior art, 6) rate peer reviewers.
  8. Prior art submissions are added to a community knowledge base and are available for use in future application reviews.
  9. Peer reviewers can view and rate the comments and prior art examples created by others, or add follow up comments in a discussion thread.
  10. Alerts are generated, notifying subscribers about new postings (e.g. prior art and/or comments) that are added to a specific application as well as the posting of new applications in areas of interest.
  11. Rank ordered results of prior art submissions are sent to the patent examiner and inventor at the close of the peer review period.
  12. Examiner can use as few or as many prior art submissions as desired in making the patentability determination.
  13. Members of the community receive "karma effects," status points for submitting prior art that is deemed relevant by the community and used by examiners.
  14. The application continues through the normal patent examination process on an accelerated schedule.

I'm still skeptical, but it might beat complying the USPTO's new rules on accelerated examination for getting "moved to the front of the line."

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Archived updates for Friday, October 20, 2006

TGIF for Painting with Baby Bottoms

U.S. Patent No. 6,022,219
"Painting kit and related method"
Issued to Elise Cohen of Aspen Colorado

What is claimed is:

1. A method of painting on a work surface using the posterior of an infant, said method comprising the acts of:

preparing a protective covering on the work surface;
preparing the background media by placing it on said protective covering on the work surface;
placing a reservoir on said protective covering;
filling the reservoir with a paint;
dipping the posterior of the infant in said paint; and
stamping the posterior on said background media to create stamping prints.

Thank Goodness It's Friday (and watch out for diaper rash),

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Archived updates for Thursday, October 19, 2006

U.S. Patent Secrecy Order Statistics

According to the Federation of American Scientists Project on Government Secrecy "at the end of fiscal year 2006, there were 4942 secrecy orders in effect" for patent applications at the U.S. Patent and Trademark Office:

Other links from the FAS:
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Federal Circuit Appoints Chief Mediator

On October 17th, Chief Judge Paul R. Michel announced the appointment of James M. Amend to the position of Chief Circuit Mediator for the Court. Mr. Amend will be assisted by present court staff in selecting cases appropriate for mediation. More than a dozen previously-trained pro bono mediators will continue to mediate cases. Mr. Amend will also personally mediate cases.
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Archived updates for Wednesday, October 18, 2006

Ringtone Prices May Drop Under Compulsory Copyright License

In a little-known decision of the U.S. Copyright Office that pitted the Recording Industry Association of America (RIAA) against the National Music Publishers Association, Inc., the Songwriters Guild of America, and the Nashville Songwriters Association International, In the Matter of Mechanical and Digital Phonorecord Delivery Rate Adjustment Proceeding, Docket No. RF 2006-1 (October 16, 2006), the U.S. Copyright Registrar concluded that ringtones qualify as digital phonorecord deliveries (“DPDs”) under 17 U.S.C. § 115 and are therefore subject to compulsory licensing.

The decision of the Copyright Registrar states:

Ringtones that are merely excerpts of a preexisting sound
recording fall squarely within the scope of the statutory license, whereas those that contain additional material may actually be considered original derivative works and therefore outside
the scope of the Section 115 license. Moreover, we decide that a ringtone is made and distributed for private use even though some consumers may purchase them for the purpose of
identifying themselves in public. We also conclude that if a newly created ringtone is considered a derivative work, and the work has been first distributed with the authorization of the copyright owner, then any person may use the statutory license to make and distribute the musical work in the ringtone. For those ringtones that are covered by Section 115 of the Copyright Act, all of the rights, conditions, and requirements in the Act would apply. For those ringtones that fall outside the scope of Section 115, the rights at issue must be acquired through voluntary licenses.
The U.S. Copyright Act contains compulsory licensing provisions governing the making and distribution of phonorecords of nondramatic musical works. Section 115 of the law provides that, once phonorecords of a musical work have been publicly distributed in the United States with the copyright owner’s consent, anyone else may, under certain circumstances and subject to limited conditions, obtain a “compulsory license” to make and distribute phonorecords of the work without express permission from the copyright owner.

The person wishing to make and distribute phonorecords of a nondramatic musical work may negotiate directly with the copyright owner or his or her agent. But, if the copyright owner is unwilling to negotiate or if the copyright owner cannot be contacted, the person intending to record the work may use the compulsory licensing provisions of the copyright law.

According to Profesesor Patry, "Since the [compulsory royalty rate] amount paid for ringtones may be substantially less than the free market rate, the cost to consumers may go down as to payments to music publishers decrease."
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Archived updates for Tuesday, October 17, 2006

Patents in Force for 2004 by Office

Accroding to the World Intellectual Property Organization, there were a total of 5.4 million patents in force worldwide in 2004. Of this total, 81% are accounted for by six offices: the United States of America, Japan, the United Kingdom, Germany, Republic of Korea and France. However, information on patents in force is not available for several offices that have relatively high numbers of patent applications, notably Argentina, Brazil, China, India and some European offices.
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Patents for 8 to 13 Year-Olds

"Inventions and Patents" is the first publication in WIPO’s new Learn from the Past, Create the Future series, created for school children as future innovators. Geared towards students from 8 to 13 years old, the publication takes the form of a self-contained work-book, which can be photocopied for classroom use. It teaches theory through practice, and IP concepts through case-studies. To play the PCT Detective game, for example, students learn to search patent applications in WIPO’s online PCT database.
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Archived updates for Monday, October 16, 2006

Reissue Corrects Declaration in Previous Reissue

Section 251 of the U.S. Patent Law sets out the requirements for obtaining a reissue patent and provides, in relevant part:

Whenever any patent is, through error without any deceptive intention, deemed wholly or partly inoperative or invalid, by reason of a defective specification or drawing, or by reason of the patentee claiming more or less than he had a right to claim in the patent, the Director shall, on the surrender of such patent and the payment of the fee required by law, reissue the patent for the invention disclosed in the original patent, and in accordance with a new and amended application, for the unexpired part of the term of the original patent.

In Medrad, Inc. v. Tyco Healthcare Group LP, et al. (October 16, 2006), the Federal Circuit expanded the meaning of "error" under 35 USC 251 to permit a reissue application where the defect a failure to file a supplemental declaration in a previous reissue patent that narrowed the scope of coverage and corrected inventorship:

Here, in the application for reissue that resulted in the ’648 reissue patent, preliminary amendments were submitted to add new claims directed solely to the broadened subject matter identified in the inventors’ declarations. These amendments were supported by the original reissue declaration. Later amendments, however, narrowed existing claims and corrected inventorship. Because the later amendments were not supported by the original reissue declaration, a supplemental declaration was required under 37 C.F.R. § 1.175; however, none was filed before the ’648 reissue patent issued. If the narrowing amendment had never been filed, there would have been no need under the rules to file a supplemental declaration, and the resulting reissue would not have been subject to a validity challenge for failure to file such supplemental declaration. However, by including changes to the language of the claims that narrowed the scope of coverage and by correcting inventorship, the resulting ’648 reissue patent claimed more than it had a right to claim in the patent without submitting a supplemental declaration to support the narrowing subject matter and the change in inventorship. The correction of such an error meets the express terms of section 251, and thus serves as a basis for reissue.

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McGreevy Aims for European Patent Court

In a speech to a Conference entitled "The Benefits of the Single Market" on October 13, 2006, European Commissioner for Internal Market and Services, Charles McCreevy provided his views on the European Patent system:

Earlier this year I launched a consultation of interested parties on future patent policy in Europe. That process showed that industry clearly supports the Commission's efforts to simplify the patent system in Europe and make it more effective. There are two issues – languages (or the cost of translation) and jurisdictional issues. Industry is not enamoured by the compromise reached by the Council in 2003 on the Community Patent in terms of the proposed solution in respect of language and the jurisdictional system because they don't achieve the cost reductions and the simplification of the system that industry wants. In parallel, there is a strong call for the improvement of the existing European patent system, established by the Munich Convention, by the successful conclusion of the European Patent Litigation Agreement on jurisdiction and by ratification of the London Agreement on the language regime. Before the end of this year I will be proposing that the Commission adopt a communication and action plan aimed at tackling the patent issues all in one approach. In particular, I want to tackle the jurisdictional issue so that we don’t have different courts in different countries delivering divergent interpretations on the same patented invention, so that we avoid businesses having to incur the expense involved in having effective patent protection across the Member States. We cannot aspire to being the most competitive economy in the world if we don't find workable solutions to patent application and protection.
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Japan and Korea Lead Patent Intensity Rankings

According to WIPO Patent Report: Statistics on Worldwide Patent Activity (2006 Edition), Japan and the Republic of Korea have the highest rate of resident patent applications per head of population at 2,884 and 2,189 patents per million inhabitants:

The Republic of Korea and Japan also have very high rates of resident patent applications per GDP:

Republic of Korea and Japan also have very high rates of patent applications per research and development expenditure:

The following chart shows the relative intensity of resident vs non-resident patent filings in each patent office. Resident patenting intensity is represented by resident patent filings per GDP and non-resident patenting intensity is measured by the ratio of non-resident to resident patent filings in each office.

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Top 20 Patent Offices by Applications Filed

Source: WIPO Patent Report - Statistics on Worldwide Patent Activity (2006 edition)
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USPTO Fees Not Unconstitutional

In Figueroa v. U.S. (October 11, 2006), the U.S. Court of Appeals for the Federal Circuit held that Congress may constitutionally impose patent fees in an amount above what is used to fund the PTO.

Miguel Figueroa ("Figueroa") contended that the statutory patent fees imposed on him in 2001 and 2002 for filing his patent application and issuing his patent violated art. I, § 8, cl. 8 of the United States Constitution (the "Patent Clause"), because the statute was designed to generate revenue to fund federal programs other than the United States Patent and Trademark Office ("PTO"). Figueroa also contended that the fees constituted an impermissible direct tax in violation of art. I, §§ 2 & 9, cl. 4 (the "Direct Tax Clauses").

According to Circuit Judge Dyk,

In Eldred v. Ashcroft, 537 U.S. 186 (2003), the Supreme Court addressed the scope of Congress’s authority under Article I, § 8, clause 8, as it relates to copyrights. The petitioner in Eldred argued that the 1998 Copyright Term Extension Act,8 which extended the duration of existing and future copyrights by 20 years, exceeded Congress’s authority under the clause. Eldred, 537 U.S. at 195-96. . . The Court rejected the petitioner’s contention that the extension of copyright terms was categorically beyond Congress’s power under the Clause, based on "an unbroken congressional practice" of enacting such extensions dating back to the first Congress in 1790. Id. at 199-200.

The Supreme Court in Eldred went on to consider whether there was a rational basis for the legislation. It upheld the challenged legislation, finding rational bases for the conclusion that it "promotes the Progress of Science." Id. . . .

We reject Figueroa’s contention that the fees were categorically beyond Congress’s power under the Patent Clause because Congress under that Clause cannot impose fees that exceed the costs of operating the PTO. . . .

Contrary to Figueroa’s argument, the Patent Clause does not limit fees that Congress may impose to the amounts directly appropriated for operating the PTO. The patent system that Congress has established need not be, and is not, limited
to the PTO. United States ex rel. Bernardin v. Duell, 172 U.S. 576, 583 (1899) ("[C]ongress may provide such instrumentalities in respect of securing to inventors the exclusive right to their discoveries as in its judgment will be
best calculated to effect that object."). Indeed, we have previously explained that the Constitution does not require "even that there be a PTO." Constant v. Advanced Mirco-Devices, Inc., 848 F.2d 1560, 1564 (Fed. Cir. 1998). Thus, for
example, in the process of construing the Patent Act’s non-obviousness provision, the Supreme Court in Graham expressly recognized that the federal courts have a role in "the administration of the patent system," insofar as courts 537 U.S. at 205-07. share with the PTO the task of enforcing the requirements for patentability. Graham, 383 U.S. at 6, 18.11 Moreover, Congress may constitutionally impose fees for patent application and issuance to serve a purpose other than raising revenue. As the Court recognized in Eldred, Congress may legitimately seek to advance other public policy goals related to the objectives of the Patent Clause by enacting legislation pursuant to the Clause. See Eldred

We conclude that Congress under the Patent Clause is not limited to enacting legislation to fund the PTO. . . .

The decision then moved to the second step in the Eldred analysis and concluded that the fees imposed did satisfy the rational basis requirement.

On the Direct Tax Clauses, Circuit Judge Dyk wrote

Figueroa next contends that the PTO’s assessment of present-level patent fees amounted to an unconstitutional Direct Tax, and thus an unlawful exaction, insofar as those fees were used to fund non-PTO programs. Article I, section 2, clause 3 of the Constitution provides that "direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers." U.S. Const. art. I, § 2, cl. 3. The Constitution also provides that "[n]o Capitation, or other direct, Tax shall be laid, unless in the Proportion to the Census or Enumeration herein before directed to be taken." Id. art. I, § 9, cl. 4. Since patent fees are uniform for all patentees regardless of their state of residence, Figueroa contends, they
constitute an unapportioned direct tax in violation of Article I, section 9, clause 4.

It is doubtful that the patent fees, paid for the privilege of securing a patent grant, should be viewed as taxes rather than payments for a privilege. See Boyden, 441 F.2d at 1043 (One "is privileged to seek the [patent] monopoly only upon compliance with the conditions which Congress has imposed . . . [including] the payment of fees required for the administration of the patent laws."). However, we conclude that, even if patent fees constitute a tax on intellectual property, they are an excise tax rather than a direct tax and need not be apportioned. . . .

In her concurrence Circuit Judge Newman agreed that

the evidence did not clearly establish that Congress was extracting more money from patentees than the government spends in administering the system. Thus his potentially viable constitutional arguments of illegal exaction and improper taxation were not demonstrated so clearly and convincingly as to establish a constitutional violation.

Mr. Figueroa also makes a strong argument that the unduly high fees are a burden on the constitutional purpose to promote the useful arts. Although without doubt the patent system should not be unnecessarily burdened, the absence of quantification and hard evidence of the effect of the fee structure weakens the constitutional force of this argument.

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Michel Responds to Federal Circuit Critics

"I frankly don't think there is anything fundamentally undesirable about the makeup, caseloads or performance of the Federal Circuit," Chief Judge Paul Michel reportedly told Staff Reporter Marcia Coyle at the National Law Journal (subscription required). "A lot of patent law is judge-made law" and "it's quite natural and expected that the Supreme Court would, from time to time, dip into the major patent dilemmas and give them a look."
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Archived updates for Friday, October 13, 2006

LAST CHANCE for the Corporate Patent Seminar

The 2006 Corporate Patent Seminar

November 12 -14, 2006 (Sun. - Tues.)

Hilton Head Marriott Beach and Golf Resort (near Savannah Int'l Airport)

$650 per seminar attendee or $850 per attendee plus spouse/guest (includes rooms, a cocktail reception and dinner on Sunday and Monday evenings, a continental breakfast on both Monday and Tuesday, and lunch on both Monday and Tuesday)

Register here by October 18, 2006

The CORPORATE PATENT SEMINAR is an ad hoc association of senior corporate patent professionals (meaning no dues, no officers, and no formal membership) dedicated to the effective and healthy exchange of ideas and experiences in the area of intellectual property law and corporate practice.

Program topics and speakers for this 43rd Annual Meeting include:

An Introduction to Intellectual Property Task-Based Billing by
William F. Heinze – Thomas, Kayden, Horstemeyer & Risley LLP, Atlanta, Georgia

Opinions of Counsel - Infringement/ Validity; content and handling by Christopher P. Isaac– Partner, Finnegan, Henderson, Farabow, Garrett & Dunner LLP, Reston, Virginia

Automated Patent Portfolio Analysis and Categorization by
Steven K. Sampson IP Analytics, Caterpillar, Inc, Peoria, Illinois

Electronic Patent Office (US e-filing PCT-SAFE, EPO e-filing) by Carl Oppedahl – Oppedahl and Olson LLP, Dillon, Colorado

Best practices: Patent Management Boards for Invention Screening, annuity decisions – A CPS Roundtable Discussion led by Dean Olson (Moderator) – Senior Corporate Counsel, Pfizer, Inc., Groton, Connecticut

Design Patents, Trade Dress, EU Community Design Utility models – Compare & Contrast by Perry Saidman – Saidman Design Law Group, Silver Spring, Maryland

European Opposition Practice by Stephen F. Jones –
Partner, Baker & McKenzie, London, United Kingdom

Patent Application Analysis Tools - Patent Optimizer by Michael Hudelson – Director of Sales and Marketing, LexisNexis, New York, New York

Competitive Intelligence and Provisional Rights; Defensive Publication Strategies, CPS Roundtable Discussion led by
Steven G. Kibby (Moderator) – Senior Corporate Counsel, Caterpillar, Inc, Peoria, Illinois

The program topics are timely and especially valuable for senior counsel with administrative and/or supervisory responsibilities. In addition to having a series of talks on topics of interest for in-house IP counsel, a hallmark of our annual meeting is our roundtable sessions. Each day, we set aside time to discuss openly our best practices and current issues for managing corporate patent departments. Indeed, our annual program strongly encourages open, active discussion among the attendees. Each participant is encouraged to contribute his or her experiences and insights on a defined subject related to the overall program in discussions held toward the conclusion of each of our seminar sessions.

We encourage all participants to bring forms, samples, or slides to use during these informal group discussions. This year we will continue the tradition of poster sessions where participants will have an opportunity to present a poster to educate the rest of the group on a topic of interest. If you plan to present a poster, let us know.

We look forward to having you join us in Hilton Head this year and invite you to bring your spouse or a guest. The Marriott Hilton Head Beach & Golf Resort is a beautiful facility located on the coast of South Carolina at One Hotel Circle. It is in the heart of great golf country, and this time of year the temperature is a mild 70-80 degrees. The cost of the room is included in the conference fees.

Register by October 18, and feel free to contact this year's program chairs for more information:

General Co-Chairs Tim Guffey and Gerry Hughes, (tel: 513-634-0796; fax 866-771-9393) (tel: 281-834-0109)

Program Co-Chairs Steve Kibby and Dean Olson, (tel: 309-675-5140) (tel: 860-441-4904)

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USPTO EFS-Web 1.1 Enhancements

As of October 14, 2006, the USPTO's "EFS-Web" electronic patent filing system will offer these enhanced capabilities:

New Types of Applications Accepted

  • Online submission of International applications filed in the US Receiving Office
  • Acceptance of PCT-SAFE .ZIP files or PDF version Form RO 101
  • Pre-Grant Publications under 37 CFR 1.211 – 1.221

New File Types Accepted

  • Text files (.TXT)
  • Computer program listings
  • Bio-sequence listings
  • Mega tables
  • .ZIP files from PCT-SAFE

New Petition Accepted

  • Online submission of Petition to Accept Unintentionally Delayed Payment of a Maintenance Fee in an Expired Patent under 37 CFR 1.378(c)

New Fillable Forms Available

  • Accelerated Exam fillable form
  • Request for Continued Examination (RCE) fillable form
  • Petition to Accept Unintentionally Delayed Payment of a Maintenance Fee in an Expired Patent under 37 CFR 1.378(c)

Register for training events at View the training slides here.

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Archived updates for Thursday, October 12, 2006

WIPO Publishes National Phase Status Information

Although the Patent Cooperation Treaty does not specifically require that applicants or national or regional Offices (henceforth “national Offices”) inform WIPO about the status of specific international applications in the national phase, information on whether an international application has entered the national phase as well as other information relating to the national phase can, where available, can be accessed via the PatentScope database at Where available, status information such as patent grant, withdrawal or refusal is also published.

The information can be found by clicking the tab “national phase” when viewing the data regarding the international application concerned. There are currently over 1 million national phase entry records, as well as status information for 458,625 PCT applications available via the PatentScope database, and it is expected that such information will become increasingly available in the coming months, as an increasing number of national Offices cooperate with WIPO in this way.

However, information on the national phase is only available where WIPO has received the relevant information, either directly from national Offices or via the INPADOC database, and, in most cases, is available only after 30 months from the priority date, which is about 12 months after international publication.Currently, the 24 countries listed below have furnished data relating to the national phase:
  • Australia
  • Austria
  • Belize
  • Bulgaria
  • Canada
  • China
  • Georgia
  • Germany
  • Israel
  • Japan
  • Kenya
  • Latvia
  • Lithuania
  • Mexico
  • New Zealand
  • Republic of Korea
  • Romania
  • Russian Federation
  • Slovakia
  • Slovenia
  • Spain
  • Turkey
  • United Kingdom
  • Uzbekistan

The timeliness of the available information varies according to the Office supplying the data. A detailed table of dates covered for each Office is available by clicking on “more information” from the National Phase tab
described above, or at the following address:

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PCT Rule Changes Planned for April 2007

According to the PCT Newsletter for October 2006, the recent WIPO Assembly adopted amendments to the PCT Regulations which will enter into force on 1 April 2007 and apply to international applications whose international filing date is on or after that date, subject to transitional arrangements in relation to certain provisions. The amendments relate to:
  • minimum requirements for International Searching and Preliminary
    Examining Authorities (relating to the International Authorities’
    quality management systems and internal review arrangements);
  • changes to physical requirements of the international application
    to assist optical character recognition (minimum text size requirements and procedures for making corrections);
  • clarification of language-related requirements of the international application (relating to the language of indications in relation to deposited biological material, of corrections of defects in translations and of the international search report, and to the establishment of
    translations of international search reports, abstracts, etc.);
  • clarifications and consequential amendments relating to amendments previously adopted by the Assembly.

The Assembly agreed that there would be a further session of the Working Group on Reform of the PCT before the 2007 session of the Assembly to consider outstanding proposals for reform of the PCT including, in particular, options for applicants to request international publication in multiple languages and supplementary searches to be carried out by Authorities other than the main International Searching Authority, as well as proposals relating to declaration of the source of genetic resources and traditional knowledge in patent applications. The Assembly noted that there are only a few PCT reform-related items remaining on the agenda of the Working Group and that the next meeting of the Working Group would most likely be the last in the present reform exercise.

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Nordic Institute to be New PCT Searching and Examining Authority

The Nordic Patent Institute (NPI) will be the newest International Searching and Preliminary Examining Authority under the Patent Cooperation Treaty (PCT). The appointment will take effect from the entry into force of the necessary agreement between NPI and the International Bureau, envisaged to take place in January 2008.

NPI is an intergovernmental organization established by Denmark, Iceland and Norway in July 2006 to act as a formal instrument of cooperation in the patent field between those States. Read the "Proposal for An Enhanced Nordic Cooperation In the Patent Field."
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China to Open "Infringement-Free Zone" in Beijing

According to the American Chamber of Commerce in China (AmCham-China), the government of Beijing's Chaoyang District signed a memorandum of understanding on October 10, 2006 to establish the "Chaoyang Model Anti-Copyright and Piracy-Free Zone" for protecting intellectual property rights:
The Zone is the first government-industry initiative of its kind in the intellectual property field in China. It aims to protect the rights of intellectual property owners for the benefit of producers, distributors and retailers of legitimate copyright products. The Model Zone initiative differs from other IPR protection programs in that it will devote significant resources to developing legitimate sales channels for original copyright products. These initiatives will help merchants who currently sell pirated products convert into sales channels for legitimate copyright products.
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China Accounts for Two-Thirds of EU Counterfeits

On October 5, 2006, the European Commission published the results of a survey of EU businesses on their experience with Intellectual Property Rights (IPR) enforcement outside the EU in 2005. The survey identifies China as the main priority for EU efforts in the fight against counterfeiting, accounting for two thirds of all counterfeit goods seized entering the EU. Secondary priorities are identified as Russia, the Ukraine, Chile and Turkey.

According to their introductory website, the "survey results send a message of concern and signal the EU’s firm resolve to tackle it. The European Union is ready to help key third countries in improving their act; but will not accept systematic and large scale infringements of the rights of EU industry."

Read the full survey results
Read more on IPR Enforcement - Priority Countries
Read Professor Michael Blakeney's Guidebook on Enforcement of Intellectual Property Rights for "assisting the developing and least developed countries’ public authorities in their efforts to comply with their obligations under Part III of the TRIPs Agreement to put into place systems and procedures for the effective enforcement of intellectual property rights."
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Archived updates for Tuesday, October 10, 2006

New Unfair Import Complaints

On October 3, 2006, Geoffrey McCabe filed a "Section 337" complaint requesting that an unfair import investigation be instituted involving "EStringed Musical Instruments and Components Thereof." The proposed respondents are: Floyd Rose Guitars, Washington; Ibanez, Inc. (Hoshino). US, Pennsylvania and Vigier, Inc., France, and the complaint has been designated as confidential and assigned Docket No. 337-2505.

On October 6, 2006, Norgen Inc., filed a "Section 337" complaint requesting that an unfair import investigation be instituted involving "Certain Devices for Modular Compressed Air Conditioning Units and the FRL Units They Connect." The proposed respondents are: SMC Corporation, Japan; SMC Corporation of America, IN; AIRTAC, China; and MFD Pneumatics, IL. The complaint has been designated as confidential and assigned Docket No. 337-2506.

Also on October 6, 2006, Fluke Corporation filed a "Section 337" complaint requesting that an unfair import investigation be instituted involving "Digital Multimeters, and Products with Multimeter Functionality." The proposed respondents are: Atladox, Inc.,CA; Circuit Specialists, Inc., AZ; Digitek Instruments Co., Ltd., Hong Kong; Electronic Specialties, Inc., IL; Electronix Express, NJ; Elenco Electronics, Inc., IL; HandsOnTools, CO; Harbor Freight Tools, CA; Jameco Electronics, CA; Kaito Electronics, Inc., CA; Parts Express, OH; Precision Mastech Enterprises Co., Hong Kong; Shenzhen Everbest Machinery Industry Co., Ltd., China; ShenZhen Hongda Electronic Co., Ltd., China; Shenzhen Victor Hi-Tech Co., Ltd., China; Sinometer Instruments Co. Ltd., China; TechBuys, LLC, CA and Velleman Inc., TX. This complaint has been designated as confidential and assigned Docket No. 337-2507.

Such complaints typically include an allegation of intellectual property infringement and a request that the infringing godds be excluded from entry into the United States. The Commission now has 30-35 days from the filing date of the complaints 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 and/or other intellectual property matter, contact me, Bill Heinze (, at Thomas, Kayden, Horstemeyer & Risley in Atlanta, Georgia.
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WIPO Moves Forward on Development Agenda, Broadcast Treaty, and Traditional Knowledge

The Assemblies of the member states of the World Intellectual Property Organization (WIPO) concluded on Tuesday, October 3, 2006. Among other things, the General Assembly agreed to renew the mandate of the Provisional Committee on Proposals Related to a WIPO Development Agenda (PCDA) for a further year. The PCDA will hold two 5-day sessions to allow for structured in-depth discussions on all 111 proposals made so far. (For further details of the decision see

The General Assembly also agreed to convene a diplomatic conference from November 19 to December 7, 2007 to update the rights of broadcasting organizations with a view to concluding a treaty on the protection of broadcasting organizations, including cablecasting organizations. The discussions are confined to the protection of traditional broadcasting organizations and cablecasting following a decision by the May 2006 session of the SCCR to examine questions of webcasting and simulcasting on a separate track. For more information please see

Member states also expressed their commitment to advancing the work of the Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore (IGC) and underlined the importance of accelerating the committee’s work and generating tangible results. The mandate of the IGC was extended for two years by the WIPO General Assembly at its 2005 session. The renewed mandate, in line with the General Assembly’s 2003 directions to the IGC, excludes no outcome, including the possible development of an international instrument or instruments in this field. Member states also welcomed the implementation of the Voluntary Fund established at the 2005 General Assembly to finance the participation of representatives of accredited observers representing indigenous and local communities. The Voluntary Fund has attracted a number of pledges which promise to make it operational in time for the December meeting of the IGC (for background information on the Voluntary Fund please see
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EuroClass TM Classification Tool

EuroClass is a classification tool that will help you in the classification of Goods and Services, and allow you to compare the classification databases of each participating office. It will provide a list of descriptions of Goods and Services that have been accepted by each office, and where no entry is found, will provide a list of similar terms in the classes searched.
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Patent Litigation Costs and Damages in Europe

Source: PATENT LITIGATION INSURANCE, A Study for the European Commission on the feasibility of possible insurance schemes against patent litigation risks FINAL REPORT, June 2006, by CJA Consultants Ltd
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Appropriations Bill Does Not Override Trademark Act

Thanks to JurisNotes for pointing to Last Best Beef, LLC v. Dudas (E.D. Va. September 27, 2006) where trademark applications were suspended by the PTO after the President signed an appropriations bill in November 2005 that included language prohibiting the registration of any trademark of the phrase "The Last Best Place." The court granted summary judgment in favor of LBB because Congress failed to expressly suspend provisions of the Lanham Act with respect to the phrase "Last Best Place." According to Judge Lee,

There is nothing in either Section 206 or the Lanham Act
that allows the USPTO to cancel a Notice of Allowance and suspend pending trademark applications. The government argues that, in reality, it has only "frozen" these applications. The USPTO has thus improvised a new term in the lexicon
of trademark law and has derived new authority, only on the basis of the enactment of Section 206, to freeze" pending trademark applications. This action by the USPTO highlights the inadequacy of section 206 as valid legislation. Section 206 prohibits registration of the phrase "Last Best Place" but it fails to specify or provide any insight as to how the USPTO should defer, dismiss, or suspend any applications currently pending for registration of that phrase. Furthermore, Section 206 does not grant the USPTO any rule-making authority with respect to the phrase. Nonetheless, the USPTO persisted in a series of actions, cancelling trademark applications, cancelling Notices of Allowances, and finally suspending or "freezingn other
pending applications, despite having no clear mandate to do so. The USPTO, thus, committed a clear error in judgment" by improvising a system of cancellation and suspension of pending trademark application6 wichout the legal authority to do so.
According to the TTABlog, the bill at issue was sponsored by Montana Senator Conrad Burns, who publicly asserted that the mark THE LAST BEST PLACE "belongs to the State of Montana." Read the article from the Missoulian here.
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Archived updates for Monday, October 09, 2006

TM Dilution Act Becomes U.S. Law

On Friday, October 6, 2006, the President signed into law H.R. 683, the "Trademark Dilution Revision Act of 2006," which amends trademark law to provide for injunctive relief in cases where use of a mark is likely to cause dilution by blurring or by tarnishment of a famous trademark.
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"I/P Updates" in the News

from the Sunday (October 8,2006) Business Section in the Atlanta Journal Constitution:

Bill Heinze, an Atlanta attorney with Thomas, Kayden, Horstemeyer & Risley, launched a blog on intellectual-property issues, his specialty. He hoped it would help drum up business.

It's taken energy and time — about 10 or 15 hours a week. Usually blogging from home, Heinze focuses on providing quick summaries of recent case decisions and journal articles. It's exactly the kind of information he thought time-starved lawyers might be looking for.

"My biggest advice is you've got to have something to say that is useful for your audience," Heinze says.

He signed up with a service that converts his blog into newsletter e-mails, sending 18,000 weekly around the nation and across the world.

Heinze figures the blog has helped him attract 20 or 30 new clients over the last two years. Still, it hasn't done as much for his client base as he expected —- and it's cost him billable hours.

As much time as it consumes, "I don't know how much longer I will be able to keep it up," he says.

and from the October 2006 issue of "The Recycler:"

Printer manufacturers have figured out that it's very difficult to use patents alone to prevent this refillng [of printer artridges]," said Willam F. ("Bill") Heinze, an intellectual property attorney for the law firm Thomas, Kayden, Horstemeyer & Risley, Atlanta, Georgia, USA. ''As we just said, there are ways to get around that."

"It's also difficult to use trademarks to protect against it, because someone always says, 'Well, this is not the original product. This is refilled and we scraped the trademarks off so everyone will know it's not an original, so we're not doing trademark infringement.' So what these guys have tried to come up with are electronic security means, the idea being that there is some little code on that printer or cartridge that somehow has to match up with the code on the printer. . .

"In that DMCA case, somebody came up with a little software system to figure out a way to get around the little security encryption system." Security circumvention under the Digital Milennium Copyright Act usually involves sellng CDs or electronic recordings when a security system prohibits resale of copies. "The court looked at that and whether the same provisions should apply to systems for cartridges and the court said 'no,' for a variety of reasons," Heinze said.

"What I thought was interesting about that [decision] is these people saying, 'Well, we can't really stop these refills with patents and we can't do it with trademarks, so what if we try and do it with copyrights? Hey; there's this new law that's perfect.'

Since the court would not apply the DMCA law in this manner, Heinze said many OEMs are up against the wall. "Their plan is to give away the printers and then they can make it up on the cartridges. That's all nice, but if you don't have the patents to back it up, it's really tough."

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USPTO Announces Discretion in Reexamining Less Than All the Patent Claims

On October 5, 2006, the United States Patent and Trademark Office (Office) is clarfied its general policies on addressing requests for reexaminaton of fewer than all the claims in a patent, and on conducting examination following requests that fail to raise a substantial new question of patentabilty (SNQ) for some of the claims requested (but do raise a SNQ as to at least one claim requested):

  1. The request for reexamination: If reexamination is requested for fewer than all of the patent claims, the Office's determination on the request (the order grantig or denying reexamination) will generally be based on a review on the merits of only the claim(s) for which reexamnation was requested.
  2. The examination stage of a reexamation proceeding: at the examation stage of the proceeding, the Office will generally only examine claims for which a) reexamination was requested, and b) a substantial new question of patentabilty (SNQ) was raised.

In appropriate instances, however, the Offce may (in its
sole discretion) decide to examne some or all ofthe non-requested claims (provided that at least one SNQ has been established by the request or has been sua sponte determined to exist by the Office).

The clarfication in policy was made for both ex parte reexamination and inter pares reexamination. The Office has recently incorporated the substance of ths Notice, in MPEP Chapter 2200 for ex parte reexamination, and MPEP Chapter 2600 for inter pares reexamination in the August 2006 Revision 5 ofthe eighth edition ofthe MPEP.

According to the accompanying explanation, this matter was squarely addressed on May 22, 2006, by the U.S. Distrct Court for the Eastern
Distrct of Virginia, in Sony Computer Entertainment America Inc., et al. v. Jon W. Dudas, Civil Action No.1 :05CV1447 (E.D.Va. May 22,2006) where the district court upheld the Office's discretion to not reexamne the non-requested claims of two patents in an inter partes reexamnation proceeding. In short, the court found that neither the statute nor the MPEP requires the Offce to examine, on the merits, the non-requested claims. While the Office has discretion to examne non-requested claims, the Offce may also choose not to exame non-requested claims.

In an instace where reexamination is not requested as to a claim, the requester cannot complain as to the Office's decision not to exame that claim in the reexamation, since requester was free to request reexamination of all the claims of the patent, but made the choice not to do so.
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No Double Counting of Patent and Trademark Infringement Damages

In AERO Products International, Inc., et al. v. INTEX Recreation Corp., et al. (October 2, 2006) the Federal Circuit concluded that an award of both patent infringement and trademark infringement damages in favor of Aero was an impermissible double recovery, and vacated the award of $1 million in trademark infringement damages.

At trial, Aero sought patent infringement damages in the amount of $3.4 million. This was based upon the testimony of Aero’s damages expert, Mark Alan Peterson, that Aero was entitled to a 15.7% reasonable royalty on $21.8 million in sales of the accused Intex mattress, which would amount to $3.425 million. At the same time, Aero sought trademark infringement damages in the amount of $2.2 million. This was based upon Aero’s contention that defendants had made $2.2 million in profits based on sales of the accused Intex mattresses. Defendants’ damages expert, Roy Weinstein, testified at trial that Intex had sold $22 million worth of accused Intex mattresses, and Intex’s profits were 10.4%, so Intex had made approximately $2.2 million in profits. In short, Aero used defendants’ patent infringement damages calculations in support of its proposed amount of trademark damages.

According to Circuit Judge Schall,

The jury awarded Aero $2.95 million dollars for the patent
infringement—presumably a reasonable royalty as Aero requested—and $1 million in Intex’s and Quality Trading’s profits for the trademark infringement. This was less than the damages that Aero requested—reasonable royalty damages of $3.4 million for the patent infringement and disgorgement
of Intex’s profits of $2.2 million for the trademark infringement.

. . . the record demonstrates that Aero based both its patent and trademark damages solely on sales of the accused Intex mattresses. Aero did not rely on any other evidence in support of its trademark damages. In other words, there was no evidence introduced at trial of Intex’s use of the mark "ONE TOUCH" other than in connection with the sales of mattresses that formed the basis for Aero’s patent infringement claim. In short, all of the damages awarded to Aero flowed from the same operative facts: sales of the infringing Intex mattresses. Aero was fully compensated for defendants’ patent infringement when it was awarded a reasonable royalty for patent infringement based on sales of the infringing Intex mattresses. It could not also be awarded defendants’ profits for trademark infringement based on the same sales of the same accused devices. This is the result compelled by Bowers, Catalina Lighting, Junker, Celeritas, and CPG Products. We thus hold that the district court abused its discretion by allowing to stand the jury’s award to Aero of $1 million in trademark damages.

Finally, we do not think that Nintendo helps Aero. Nintendo stated that, "[p]ut together, selling the cartridges may have been one act, but it was two wrongs [trademark and copyright infringement]." 40 F.3d at 1011. The Nintendo court reasoned that "Congress created two separate statutory schemes to govern copyrights and trademarks; in order to effectuate the purposes of both statutes, damages may be awarded under both." Id. Further, the court reasoned that Nintendo "did not recover the same type of damages under both acts" because it recovered actual damages under the Lanham Act and it elected and recovered statutory damages, instead of actual damages, under the Copyright Act. Id. From our standpoint, the problem with Aero’s reliance on Nintendo is that an award of both patent and trademark infringement damages in this case would be contrary to our decisions in Bowers, Catalina Lighting, Junker, Celeritas, and CPG Products. Under these cases, even though damages are claimed based upon separate statutes or causes of action, when the claims arise out of the same set of operative facts, as is the case here, there may be only one recovery.

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Trends in the U.S. Patent Procurement Bar

According to Hal Wegner in "Trends in Patent Practice: Will Patent Boutiques Survive" (October 2006) --

The division between upper end law practice and the patent boutiques is manifested by the fact that just the top twenty law firms in the country cumulatively have far greater numbers of attorneys than all registered patent attorneys and agents combined. The top twenty firms average only 65 registered
patent practitioners per thousand attorneys; in contrast, the percentage for the four largest patent procurement firms that together obtain more than 12,000 patents per year is tenfold greater. Vis a vis the more than 25,000 lawyers that populate the top twenty law firms, there are no more than 900 registered patent attorneys or agents in the top twenty firms. This speaks to the growing polarization and lack of influence of the patent procurement bar in leadership councils in the United States.

The sharp separation of the patent practice into two camps is seen from the concentration of large volumes of procurement work in the hands of patent processing specialists often with only agency experience: Just four firms within a short distance from the Patent and Trademark Office alone account for the grant of more than 12,000 patents per year; the huge bulk comes from Asia with a lesser amount from Europe and domestic sources.

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TGIF for the Toilet Snorkel

"Fresh-air breathing device and method"
William O. Holmes of Belmont California USA

ABSTRACT: The recent rash of fires in high-rise hotels and deaths occasioned thereby has given rise to the need for a breathing device and method for supplying a hotel guest and/or fireman with fresh air until he can be rescued. The device and method of this invention provide for the insertion of a breathing tube through the water trap of a toilet to expose an open end thereof to fresh air from a vent pipe connected to a sewer line of the toilet, to enable the user to breathe fresh air through the tube.

Thank Goodness It's Friday (the 13th),

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What this Brief Needed was Better Facts

Thanks to the Delaware I/P Blog for discussing Positec USA Inc. v. Milwaukee Electric Tool Corp., C.A. No. 05-890 (D. Del., Sept. 25, 2006) (Sleet, J.) where Milwaukee sent a letter to Positec China on December 15, 2005 stating that Milwaukee “will be forced to commence an infringement action to enforce its intellectual property rights and to stop your company’s infringement,” if Positec China has not ceased infringing activities by December 29, 2005. After Positec USA's Declaratory Judgment Action was filed, Milwaukee then sent another letter to Positec China explaining that its earlier correspondence threatening legal action, “was only intended to initiate a dialogue in the hopes of reaching an amicable global business resolution.”

According to the Order denying Milwaukee's motion to dismiss the Declaratory Judgment Action,

Milwaukee contends in its reply brief that its January 17, 2006 letter to Positec China [sent the same day as its reply brief] regarding the patents-in-suit evidences an intention to address patent issues directly with Positec China, the manufacturer of the saw. According to Milwaukee, the letter “explains that its prior correspondence, including the December 15, 2005 letter, was intended to ‘initiate a dialogue in the hopes of reaching an amicable global business resolution.’” (D.I. 14, at 10; D.I. 15, Ex. 9 at 1.) The letter discusses the present case, and states that Milwaukee “has no intention of litigating its referenced patents against Positec USA or any other customer, distributor or sales representative of Positec China at this time.” (Id.) The letter also states that Milwaukee hopes to avoid litigation entirely by communicating directly with Positec China. (Id.) The court finds that Milwaukee’s attempt, after the commencement of this lawsuit, to backpedal and “explain” the real intention of its prior letters belies its assertion that it did not threaten litigation against Positec USA.
The court therefore concluded that Positec USA has demonstrated a reasonable apprehension of an infringement suit by Milwaukee, based upon Milwaukee’s indirect threat of infringement in its December 15, 2005 letter.
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Archived updates for Sunday, October 08, 2006

Federal Circuit Not Bound by PTO's Reexamined Claim Construction

In SRAM Corp. v. AD-II Engineering, Inc. (October 2, 2006), Federal Circuit Judge Linn confirmed that the Federal Circuit gives no defference to the reexamined claim construction of the U.S. Patent and trademark Office:
SRAM also urges that we adopt the district court’s construction of claim 16 as providing for "precision indexed downshifting" on the ground that, after three reexamination proceedings, the Patent Examiner—like the district court—construed claim 16 as providing "precision indexed downshifting" as a means to take up lost motion, and confirmed its patentability over prior art gear-shifting devices that require a user to manually overshift. This argument is not persuasive. While the Patent and Trademark Office (the "PTO") generally gives claims their broadest reasonable , 367 F.3d 1359, 1364 (Fed. Cir. 2004); In re Bond, 910 F.2d 831, 833 (Fed. Cir. 1990), paradoxically in this case, the PTO construed the claim narrowly, rather than broadly, by reading in the same limitation as did the district court. In doing so, the PTO erred for the same reasons as did the district court. The Patent Examiner’s actions thus provide no support for SRAM’s argument. Furthermore, this court is not bound by the PTO’s claim interpretation because we review claim construction de novointerpretation consistent with the specification, see In re American Academy of Science Tech Center. Cybor Corp., 138 F.3d at 1456.
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Suggestion to Combine May Be "Filtered" From the Prior Art

In Dystar Textilfarben GMBH & Co Deutschland KG v. C.H. Patrick, Co., et al. (Fed. Cir.; October 3, 2006), Chief Judge Michel addressed crticisms of his court's standard for the motivation to combine teachings from multiple references in order to invalidate a patent claim:

Following the 1952 enactment of § 103, the Supreme Court explained that obviousness depends on (1) the scope and content of the prior art; (2) the differences between the claimed invention and the prior art; (3) the level of
ordinary skill in the art; and (4) any relevant secondary considerations,
including commercial success, long felt but unsolved needs, and failure of
others. Graham v. John Deere Co., 383 U.S. 1, 17 (1966).

This court has articulated a subsidiary requirement for the first Graham
factor, the scope and content of the prior art. SIBIA Neurosciences, Inc. v.
Cadus Pharma. Corp., 225 F.3d 1349, 1356 (Fed. Cir. 2000). Where, as here, all
claim limitations are found in a number of prior art references, the factfinder
must determine "[w]hat the prior art teaches, whether it teaches away from the
claimed invention, and whether it motivates a combination of teachings from
different references". In re Fulton, 391 F.3d 1195, 1199-1200 (Fed. Cir. 2004).
It is important in this inquiry to distinguish between the references sought to
be combined and "the prior art", as the latter category is much broader. For
example, textbooks or treatises may include basic principles unlikely to be
restated in cited references.

. . . In contrast to the characterization of some commentators, the suggestion test is not a rigid categorical rule. The motivation need not be found in the references sought to be combined, but may be found in any number of sources, including common knowledge, the prior art as a whole, or the nature of the problem itself. In re Dembiczak, 175 F.3d 994, 999 (Fed. Cir. 1999). As we explained in Motorola, Inc. v. Interdigital Tech. Corp., 121 F.3d 1461, 1472 (Fed. Cir. 1997), "there is no requirement that the prior art contain an express suggestion to combine known elements to achieve the claimed invention. Rather, the suggestion to combine may come from the prior art, as filtered through the knowledge of one skilled in the art."

. . . DyStar argues that this court's "suggestion test" for obviousness requires the cited references themselves to contain a suggestion, teaching, or motivation to combine them, and that it must be explicitly stated. DyStar then points out, correctly, that Brochet does not suggest combining his invention with those of Chaumat or Wimmer to stabilize his leuco indigo solution in oxygen-excluding containers until either using it directly in the dyebath or placing it on the market for sale, respectively. Absent such a teaching, urges DyStar, the invention of claim 1 of the '992 patent cannot be obvious.

DyStar's argument misreads this court's cases and misdescribes our suggestion test, echoing notions put forth recently by various commentators and accepted in major reports. A 2003 report by the Federal Trade Commission, for example, quoted testimony of certain witnesses that this court requires "specific and definitive [prior] art references with clear motivation of how to combine those references" and requires the PTO to find "the glue expressly leading you all the way [to obviousness]" and "connect the dots . . . very, very clearly." Fed. Trade Comm'n, To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy ch. 4, at 11 (2003). Similarly, a 2004 report by the National Academy of Sciences summarized views of a few commentators that "standards of patentability—especially the non-obviousness standard—have become too lax as a result of court decisions" by the Federal Circuit, leading to the deterioration of patent quality. Nat'l Research Council, A Patent System for the 21st Century 3 (Stephen A. Merrill et al. eds., 2004). But see Am. Intellectual Prop. Law Ass'n, AIPLA Response to the National
Academies Report entitled "A Patent System for the 21st Century" 10 (2004)
("AIPLA believes that the courts, including the Federal Circuit, have applied
the standard of non-obviousness with both the needed rigor and the appropriate
vigor, and they have done so with a commendable consistency over the past two
decades. If a difficulty exists with application of the non-obviousness standard
today, it does not lie in the patent statute or in substantive law of
non-obviousness as applied in the courts.")

Seeking to support their assertions about Federal Circuit caselaw, these few commentators have quoted isolated statements from three of our precedents in particular, including Dembiczak, 175 F.3d at 1000, wherein we stated that the analysis by the Board of Patent Appeals and Interferences ("Board") "fails to demonstrate how the [two cited] references teach or suggest their combination" (emphasis added), and In re Lee, 277 F.3d 1338, 1341, 1344 (Fed. Cir. 2002), where we characterized the Board's statement that "[t]he conclusion of obviousness may be made from common knowledge and common sense of a person of ordinary skill in the art without any specific hint or suggestion in a particular reference" as "[o]mission of a relevant factor required by precedent". They have also cited our repeated use of the word "references" in the following list from Ruiz v. A.B. Chance Co., 234 F.3d 654 (Fed. Cir. 2000), where we suggested a motivation to combine may be found:

  1. in the prior art references themselves;
  2. in the knowledge of those of ordinary skill in the art that certain references, or disclosures in those references, are of special interest or importance in the field; or
  3. from the nature of the problem to be solved, leading inventors to look to references relating to possible solutions to that problem.

Id. at 665(emphasis added) (internal quotation marks omitted). Despite containing arguably imprecise language in these statements, quoted out of context, each of the above-cited cases correctly applies the suggestion test and by no means requires an explicit teaching to combine to be found in a particular prior art reference. Dembiczak involved the combination of a reference in the plastic
trash bag art with children's arts and crafts books that included, among
innumerable fanciful drawings, jack-o-lanterns. Contrary to some interpretations, we stated explicitly that evidence of a motivation to combine need not be found in the prior art references themselves, but rather may be found in "the knowledge of one of ordinary skill in the art, or, in some cases, from the nature of the problem to be solved." 175 F.3d at 999 (citation omitted). When not from the prior art references, the "evidence" of motive will likely consist of an explanation of the well-known principle or problem-solving strategy to be applied. Our analysis in Dembiczak focused on an explicit teaching in the prior art not because our case law requires it, but because the Board had stated that "the [two cited] references would have suggested the application of . . . facial indicia to the prior art plastic trash bags." Id. at 1000 (emphasis added). We held the Board's obviousness determination legally insufficient because, in addition to failing to make Graham findings, the
Board's analysis was "limited to a discussion of the ways that the multiple
prior art references can be combined to read on the claimed invention", "rather
than pointing to specific information in [the two references] that suggest the
combination". Id. On appeal to this court, the Commissioner of Patents and
Trademarks attempted to defend the Board decision by laying out, using the
Graham factors, a clear—and likely affirmable—rationale establishing the level
of ordinary skill and explaining the motivation to combine. Id. at 1001. We
declined to consider these arguments, newly raised on appeal, stating that they
did "little more than highlight the shortcomings of the decision below." Id.

. . . It is difficult to see how our suggestion test could be seen as rigid and categorical given the myriad cases over several decades in which panels of this court have applied the suggestion test flexibly. Obviousness is a complicated subject requiring sophisticated analysis, and no single case lays out all facets of the legal test. DyStar's argument and the above-cited commentary highlight the danger inherent in focusing on isolated dicta rather than gleaning the law of a particular area from careful reading of the full text of a group of related precedents for all they say that is dispositive and for what they hold. When parties like Dystar do not engage in such careful, candid, and complete legal analysis, much confusion about the law arises and, through time, can be compounded.

[ FOOTNOTE HERE: Indeed, the United States Supreme Court recently granted certiorari in a case involving this court's application of the suggestion test. KSR Int'l Co. v. Teleflex, Inc., 2006 U.S. LEXIS 4912 (June 26, 2006). In KSR, we vacated a district court's grant of summary judgment of invalidity for obviousness. The district court found a motivation to combine not in the references but "largely on the nature of the problem to be solved", which we did not deem erroneous. Teleflex, Inc. v. KSR Int'l Co., 119 Fed. App'x 282, 287 (Fed. Cir. 2005) (unpublished). Rather, we vacated because the court did not explain sufficiently its rationale, and failed to make "findings as to the specific understanding or principle within the knowledge of a skilled artisan that would have motivated one with no knowledge of [the] invention to make the combination in the manner claimed." Id. at 288 (citation omitted).]

Our suggestion test is in actuality quite flexible and not only permits, but requires, consideration of common knowledge and common sense. See, e.g., In re Kotzab, 217 F.3d 1365, 1369 (Fed. Cir. 2000) ("A critical step in analyzing the patentability of claims pursuant to section 103(a) is casting the mind back to the time of invention, to consider the thinking of one of ordinary skill in the art, guided only by the prior art references and , 416 F.2d at 1390 ("Having established that this knowledge was in the art, the examiner could then properly rely, as put forth by the solicitor, on a conclusion of obviousness 'from common knowledge and common sense of the person of ordinary skill in the art without any specific hint or suggestion in a particular reference.'"). the then-accepted wisdom in the field."); Motorola, 121 F.3d at 1472 ("[T]he suggestion to combine may come from the prior art, as filtered through the knowledge of one skilled in the art.").

Indeed, we have repeatedly held that an implicit motivation to combine
exists not only when a suggestion may be gleaned from the prior art as a whole,
but when the "improvement" is technology-independent and the combination of
references results in a product or process that is more desirable, for example
because it is stronger, cheaper, cleaner, faster, lighter, smaller, more durable, or more efficient. Because the desire to enhance commercial opportunities by improving a product or process is universal—and even common-sensical—we have held that there exists in these situations a motivation to combine prior art references even absent any hint of suggestion in the references themselves. In such situations, the proper question is whether the ordinary artisan possesses knowledge and skills rendering him capable of combining the prior art references.

. . . Although this court customarily discusses a motivation to combine as part of the first Graham factor, the scope and content of the prior art, see SIBIA Neurosciences, 225 F.3d at 1356, motivation to combine is also inextricably linked to the level of ordinary skill. If, as is usually the case, no prior art reference contains an express suggestion to combine references, then the level of ordinary skill will often predetermine whether an implicit suggestion exists. Persons of varying degrees of skill not only possess varying bases of knowledge, they also possess varying levels of imagination and ingenuity in the relevant field, particularly with respect to problem-solving abilities. If the level of skill is low, for example that of a mere dyer, as DyStar has suggested, then it may be rational to assume that such an artisan would not think to combine references absent explicit direction in a prior art reference. If, however, as we have held as a matter of law, the level of skill is that of a dyeing process designer, then one can assume comfortably that such an artisan will draw ideas from chemistry and systems engineering—without being told to do so. . .

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Archived updates for Friday, October 06, 2006

Google Code Search Indexes Prior Art Software

Google Code Search indexes function definitions and sample code by giving you one place to search publicly accessible source code hosted on the Internet. It supports POSIX extended regular expression syntax, excluding backreferences, collating elements, and collation classes. You can even submit your code using their online form.

They're crawling as much publicly accessible source code as they can find, including archives (.tar.gz, .tar.bz2, .tar, and .zip), CVS repositories and Subversion repositories. Google Code Search respects robots.txt, so there are a couple ways you can block them from crawling your code.

They do their best to determine the software license for code packages by looking for a license in the comments or in a separate license file. If they can't find a license, they indicate that the license is "Unknown." But the Code Search results can't tell you what patents may cover a piece of software.

Learn more about Google Code Search at Peter Zura's Two-Seventy-One Patent Blog and their discussion group.

And, if you have not seen it already, Google Blog Search include all blogs, not just those published through Blogger. It is continually updated, and you can search not just for blogs written in English, but in French, Italian, German, Spanish, Korean, Brazilian Portuguese and other languages as well.
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