A weekly summary of the precedential patent-related opinions issued by the Court of Appeals for the Federal Circuit and the opinions designated precedential or informative by the Patent Trial and Appeal Board.
Schwendimann, et al. v. Arkwright Advanced Coating, Inc., Nos. 2018-2416, 2019-1012 (Fed. Cir. (D. Minn.) May 13, 2020). Opinion by O’Malley, joined by Wallach. Dissenting opinion by Reyna.
Schwendimann’s employer assigned three patent applications to Schwendimann. When filing the assignment for one of the applications (the ’845 Application), the attorney attached a copy of a different assignment by mistake. Several years later, Schwendimann filed a complaint against Arkwright for infringement of several patents including the patent that issued from the ’845 Application. Arkwright moved to dismiss on the ground that Schwendimann did not own the patent because of the assignment error. The district court reformed the assignment error nunc pro tunc and denied the motion. The case then proceeded to a jury trial, resulting in a judgment of willful infringement and an award of prejudgment interest.
On appeal, Arkwright argued that the district court erred in finding that Schwendimann had standing and erred in awarding prejudgment interest on the entire damages from the first infringement date.
The Federal Circuit first held that Schwendimann was a patentee at the time her action was filed and that the corresponding assignment was reflected in a written instrument within the meaning of 35 U.S.C. § 261. The Federal Circuit determined that the district court permissibly reformed the assignment error.
Applying the standard recently announced in Lone Star, the Federal Circuit explained that “whether one qualifies as a patentee under 35 U.S.C. § 281 is a statutory prerequisite to the right to relief in a patent infringement action, but does not implicate the district court’s subject matter jurisdiction.” Thus, as long as Schwendimann alleged “facts that support an arguable case or controversy under the Patent Act, the court has both the statutory and constitutional authority to adjudicate the matter.” Because Schwendimann’s complaint contained such allegations, there was no standing issue to be decided on appeal.
Turning to Arkwright’s challenge of the prejudgment interest award, the Federal Circuit held that the district court did not abuse its discretion.
Judge Reyna dissented, stating that a plaintiff must have Article III standing at the time it filed suit and that the majority “obscures the principle” by “blessing the district court’s post-suit cure of Ms. Schwendimann’s lack of constitutional standing at the time she filed her complaint.”
Electronic Communication Technologies, LLC v. ShoppersChoice.com, LLC, No. 2019-1587 (Fed. Cir. (S.D. Fla.) May 14, 2020). Opinion by Prost, joined by Dyk and Wallach.
Electronic Communication Technologies sued ShoppersChoice.com, alleging infringement of Claim 11 of U.S. Patent No. 9,373,261. ShoppersChoice.com filed a motion for judgment on the pleadings that Claim 11 is ineligible under 35 U.S.C. § 101. The district court granted the motion, finding that Claim 11 “is directed to the abstract idea of providing advance notification of the pickup or delivery of a mobile thing.” The district court further concluded that Claim 11 does not include an inventive concept, instead reciting “generic computer components that can be configured to perform purely conventional computer functions.”
On appeal, the Federal Circuit applied the two-step framework for evaluating patent eligibility set out in Alice. Addressing step one, the Federal Circuit agreed with the district court that the claim is directed to an abstract idea, and amounts to nothing more than a fundamental business practice. The court held that “[c]laims, like claim 11, that are directed to longstanding commercial practices do not pass step one of the two-part § 101 test.”
Regarding step two, the Federal Circuit ruled that Claim 11 did not include an inventive concept sufficient to transform the abstract idea into a patent-eligible claim because “the claim only entails applying longstanding commercial practices using generic computer components and technology; such claims are ineligible under § 101.”
Lanard Toys Ltd. v. Dolgencorp LLC, et al., No. 2019-1781 (Fed. Cir. (M.D. Fla.) May 14, 2020). Opinion by Lourie, joined by Mayer and Wallach.
Lanard sued for infringement of a design patent directed to a toy chalk holder designed to look like a pencil. Lanard also asserted claims for copyright infringement, trade dress infringement, and statutory and common law unfair competition. The district court granted summary judgment to the defendants with respect to each of Lanard’s claims, and Lanard appealed.
The Federal Circuit affirmed the court’s grant of summary judgment. Mirroring the district court’s application of the two-part test for design patent infringement, the Federal Circuit first analyzed the district court’s claim construction, concluding that the court followed the Federal Circuit’s “claim construction directives to a tee.”
Next, assessing infringement, the Federal Circuit concluded that the district court correctly applied the “ordinary observer” test. The district court found that the similarities between the patented and the accused design “stem from aspects of the design that are either functional or well-established in the prior art.” The Federal Circuit agreed with the district court’s analysis, explaining that “while the ‘ordinary observer’ test is not an element-by-element comparison, it also does not ignore the reality that designs can, and often do, have both functional and ornamental aspects.” A court “must consider the ornamental features and analyze how they impact the overall design,” and “[t]hat is what the district court did in this case.”
The Federal Circuit also affirmed the district court’s grant of summary judgment that Lanard’s copyright is invalid and alternatively not infringed, that the accused product does not infringe Lanard’s trade dress, and that Lanard’s unfair competition claims fail.
Cochlear Bone Anchored Solutions AB v. Oticon Medical AB, et al., Nos. 2019-1105, -1106 (Fed. Cir. (PTAB) May 15, 2020). Opinion by Taranto, joined by O’Malley. Opinion concurring-in-part and dissenting-in-part by Newman.
Cochlear owns a patent directed to a bone-anchored hearing aid that transmits soundwaves transcranially from a patient’s deaf ear to the patient’s non-deaf ear. Oticon sought IPR of all claims. During the IPR, Cochlear disclaimed Claims 1–3 and 13, and the Patent Trial and Appeal Board concluded that Oticon proved Claims 3–6 and 11–12 unpatentable but did not prove Claims 7–10 unpatentable. The Board found that Claims 7–10 contain means-plus-function limitations, without a corresponding structure disclosed in the specification, thus preventing the Board from conducting a prior-art analysis.
Cochlear appealed, and Oticon cross-appealed. The Federal Circuit affirmed the Board’s conclusions as to all claims except Claim 10, as to which the court vacated and remanded.
Cochlear argued that Claim 1’s preamble limits the scope of the claims. The Federal Circuit disagreed, concluding that the preamble’s recitation of “for rehabilitation of unilateral hearing loss” is “merely a statement of intended use” and adds no structural element and provides no antecedent basis.
On cross-appeal, Oticon argued that the Board erred by concluding that it could not conduct a prior-art analysis for Claims 7–10. The Federal Circuit agreed that Claims 7–9 contain at least one required means-plus-function term for which the specification provides no corresponding structure. As to Claim 10, however, the court explained that it is written in a disjunctive manner that “creates three alternative subsets of claim coverage,” and “the first alternative is independent of the others, and it has a discernible meaning and can be compared to the prior art.” The Federal Circuit therefore vacated the Board’s ruling as to Claim 10 and remanded.
Judge Newman concurred with the majority’s holding for Claims 7–10, but dissented as to Claims 4–6 and 11–12. In her view, the court’s ruling that the preamble is not limiting is incorrect and “opens the claims to prior art that is distinct from the [claimed] invention, prior art that is distinguished by the limitations in this clause.” She explained that the court’s analysis “produces major changes in the relation of the claimed invention to the prior art.”