The following is a summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit for the week ending March 8, 2013. Josh Weeks and Wes Achey prepared the summaries in this issue.
Patentable Invention: Double Patenting
Patent Office Procedures: Prosecution Before the Office: Rejections
In re Jeffrey Hubbell, et al., No. 11-1547 (Fed. Cir. (B.P.A.I.) Mar. 7, 2013). Opinion by O’Malley, joined by Wallach. Dissenting opinion by Newman.
In upholding the Board of Patent Appeals and Interferences’ (“Board”) rejection based on obviousness-type double patenting, the Federal Circuit held that an application and conflicting patent need not have common ownership or identical inventive entities. Further, the Federal Circuit held that a terminal disclaimer is available to overcome an obviousness-type double patenting rejection only in cases of common ownership.
Jeffrey Hubbell and Jason Schense are both listed as inventors, among others, on U.S. Patent Application No. 10/650,509 (“the ʼ509 application”) and U.S. Patent No. 7,601,685 (“the ʼ685 patent”). Both the ʼ509 application and the ʼ685 patent generally relate to tissue regeneration using biomatrices. The ʼ509 application, filed on August 27, 2003, was based on research conducted by Hubbell and Schense while employed at the California Institute of Technology (“CalTech”), and is assigned to CalTech. In 1998, Hubbell left CalTech and joined the faculty at Eidgenossische Technische Hochschule Zurich (“ETHZ”). The ʼ685 patent, which is assigned to ETHZ, issued on October 13, 2009.
During prosecution, the ʼ509 application was rejected, in part, for obviousness-type double patenting over the ʼ685 patent, which was affirmed by the Board. Specifically, the Board found that certain claims of the ʼ685 patent and ʼ509 application claimed the same subject matter and, thus, upheld the examiner’s double patenting rejection.
On appeal, the Federal Circuit declined to create an exception to the application of obviousness-type double patenting, and held that identity of inventive entities and common ownership are not prerequisites for such a rejection. The court reasoned that even where the application and conflicting patent were not commonly owned, there is too great a risk of a potential infringer being subject to suit from two separate entities. Similarly, the Federal Circuit found no basis in its precedent to support Hubble’s argument that obviousness-type double patenting should not apply where the inventive entities are not identical.
The Federal Circuit similarly rejected Hubbell’s assertion that he should be allowed to file a terminal disclaimer. In accordance with precedent, terminal disclaimers may be used to overcome an obviousness-type double patenting rejection only where the patent and application at issue are commonly owned. Although the Cooperative Research and Technology Enhancement Act (“CREATE Act”) provides an exception to this general rule in the case of joint research agreements, no such agreement was in place in this instance, and the Federal Circuit “declined Hubbell’s invitation to rewire the statutory text.”
Finally, the Federal Circuit declined to apply a “two-way” obviousness-type double patenting test, under which the examiner is to inquire whether the patent’s claims are obvious in light of the application’s claims. The Federal Circuit held, however, that such a test is limited to the single instance where “the PTO is solely responsible for the delay in causing the second-filed application to issue prior to the first.” Because the record clearly established that Hubbell’s prosecution choices were responsible for the delay, Hubbell was not entitled to a two-way test.
In a dissenting opinion, Judge Newman disagreed with the majority’s interpretation of prior case law, stating that common inventorship or ownership is required for any double patenting rejection. Moreover, Judge Newman explained that where an obviousness-type double patenting is made, “a terminal disclaimer is necessarily available.”
Litigation Practice and Procedure: Summary Judgment
Infringement: Contributory and Induced Infringement: Generally
Move, Inc., et al. v. Real Estate Alliance Ltd., et al., No. 12-1342 (Fed. Cir. (C.D. Cal.) Mar. 4, 2013). Opinion by Lourie, joined by Rader and Moore.
In reversing the district court’s grant of summary judgment of noninfringement, the Federal Circuit held that the district court’s failure to conduct an indirect infringement analysis necessitated reversal and remand for further proceedings in accordance with Akamai Technologies Co. v. Limelight Networks, Inc., 692 F.3d 1301, 1307 (Fed. Cir. 2012). In review of Akamai, the Federal Circuit further clarified that in the inducement context, infringement of a method claim may occur even where a single entity does not perform each and every step, so long as all other requirements for inducement are met.
Real Estate Alliance Ltd. (“REAL”) is the owner of U.S. Patent No. 5,032,989 (“the ʼ989 patent”). The ʼ989 patent relates to a specific methodology for locating available real estate properties using a computer. Move, Inc. (“Move”) operates interactive websites that allow users to search for properties among a myriad of other options. In 2007, Move filed a declaratory judgment action in the Central District of California seeking declarations that certain websites operated by Move do not infringe the ʼ989 patent. REAL counterclaimed, asserting that certain features of Move’s websites infringe REAL’s patent.
After the district court’s claim construction in 2009, the parties entered a stipulation of noninfringement and the court entered a judgment in favor of Move. On appeal, however, the Federal Circuit modified the district court’s construction of the phrase “selecting an area” and vacated and remanded the case to the district court. Upon remand, the parties both moved for summary judgment. The district court found that Move’s systems did not “select an area” in accordance with the Federal Circuit’s construction and, thus, granted summary judgment in favor of Move.
REAL once again appealed the decision arguing that the district court ignored the Federal Circuit’s claim construction. Rejecting REAL’s arguments, the Federal Circuit held that the district court properly applied its construction and that Move did not directly infringe the ʼ989 patent, as its system did not perform each and every step of the asserted claims. The Federal Circuit also held, however, that the district court erred by failing to address inducement of infringement under 35 U.S.C. § 271(b). In reviewing its decision in Akamai, the Federal Circuit clarified that in the inducement context, infringement of a method claim may occur even where a single entity does not perform each and every step, so long as all other requirements for inducement are met. Accordingly, the Federal Circuit vacated the district court’s grant of summary judgment and remanded the case for further proceedings in light of Akamai.
Finally, REAL sought to have the case reassigned to another judge upon remand, arguing that the current judge was biased against REAL. In support for this position, REAL pointed to the judge’s alleged failure to properly apply the Federal Circuit’s claim construction. Finding REAL’s claims to be “wholly without merit,” the Federal Circuit declined to reassign the case.
Defenses: Delay in Filing Suit: Estoppel
Litigation Practice and Procedure: Procedure: Appellate Jurisdiction and Procedure
Radio Systems Corp., et al. v. Lalor, et al., No. 12-1233 (Fed. Cir. (W.D. Wash.) Mar. 6, 2013). Opinion by Moore, joined by Reyna. Opinion concurring in part and dissenting in part by Newman.
Affirming-in-part and reversing-in-part the district court’s application of equitable estoppel, the Federal Circuit held that a patentee’s prior enforcement efforts with regard to an issued patent could not be imputed to a then unissued continuation-in-part application. Further, the Federal Circuit granted a motion to strike portions of the appellees’ brief that were outside the scope of the district court’s judgment, thus requiring a cross-appeal.
Bumper Boy, Inc. (“Bumper Boy”) is the owner of U.S. Patent Nos. 6,830,014 (“the ʼ014 patent”) and 7,267,082 (“the ʼ082 patent”), which is a continuation-in-part of the ʼ014 patent. Both patents are directed to animal collars containing electrodes. Innotek, Inc. (“Innotek”) and Radio Systems Corporation (“Radio Systems”) are both manufacturers of collars with electrodes.
In February 2005, Bumper Boy sent a letter to Innotek stating that its UltraSmart collar infringed the ʼ014 patent and demanding that Innotek either license the patent or discontinue the collar. Innotek responded by claiming that the ʼ014 patent was invalid and thereafter continued to sell the UltraSmart and other similar collars without further response from Bumper Boy. In September 2006, Radio Systems acquired Innotek and released the SD-1825 collar, which incorporated Innotek’s previous designs.
In November 2009, Bumper Boy sent Radio Systems a demand letter accusing Innotek’s UltraSmart and Radio Systems’ SD-1825 collars of infringing both the ʼ014 and ʼ082 patents. Radio Systems filed this action in May 2010, seeking declarations of noninfringement and invalidity, to which Bumper Boy responded with counterclaims accusing the UltraSmart, as well as the GS-011, FieldPro, and SD-1825 collars (the “new collars”) of infringing both patents. Ultimately, the district court granted summary judgment in favor of Radio Systems, finding that the new collars did not infringe either patent, and that equitable estoppel barred Bumper Boy’s claims against the UltraSmart collar.
On appeal, Bumper Boy argued that the district court erred in its claim constructions, as well as its application of equitable estoppel. Finding no error in the district court’s constructions, the Federal Circuit affirmed the district court’s grant of summary judgment with regard to the new collars. With regard to equitable estoppel, the Federal Circuit affirmed its application to the ʼ014 patent, but reversed the district court with regard to the ʼ082 patent.
With regard to the ʼ014 patent, Bumper Boy did not contest the application of equitable estoppel to Innotek, but argued that because Radio Systems and Innotek were different entities, its actions directed at Innotek could not bar its claims against Radio Systems. The Federal Circuit disagreed, however, and held that equitable estoppel applied to successors-in-interest where privity is established. Thus, the court affirmed the district court’s grant of summary judgment.
In reversing the district court’s application of equitable estoppel with regard to the ʼ082 patent, the Federal Circuit held that because the claims of the ʼ082 and ʼ014 patents are necessarily different in scope, Bumper Boy’s actions could not have created a case or controversy prior to the issuance of the ʼ082 patent. As such, Radio Systems’ and Innotek’s first effective notice of the ʼ082 patent was the November 2009 demand letter, which was received only five months before suit was filed. Accordingly, there was no misleading conduct or reliance thereon which could have given rise to equitable estoppel.
Finally, the Federal Circuit granted Bumper Boy’s motion to strike portions of Radio Systems’ brief which argued that an alternative ground for affirmance was invalidity of the patents. Specifically, the Federal Circuit held that because invalidity is a broader issue than noninfringement, the district court’s judgment of noninfringement did not reach the issue of invalidity. As such, Radio Systems was required to file a cross-appeal in order to enlarge the scope of a judgment, despite the inherent inefficiency.
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