Overview of US Patent Litigation and US Patent Law
Many business professionals often lack a sufficient understanding of the fundamentals of US Patent Law. To bridge the gap and make my professional conversations with clients more useful and time-effective, I offer the following synopsis of US Patent Litigation and Patent Law. Please note that this synopsis is only for basic informational and entertainment purposes and should not be relied upon as legal advice. You should consult with me personally to discuss your Patent Litigation matter.
There are four main Types of Patents in US Patent Law. These include "process patents" (e.g., purification process), "product patents" (e.g., Chakrabarty’s synthetic bacteria, see below), "new use patents" (e.g., new use for Hormone Z), and "business method patents" (e.g., selling a rock as a “pet rock”).
The principle Source of Law for Patent Law is the Constitution of the USA, Article I, Section 8, which states that “The Congress shall have Power To promote the progress of Science and useful Arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”
The primary Goals of US Patent Law are to promote the public interest via the advancement of science (rather than to reward individuals), to maintain an incentive to invest, and to destroy the secrecy of useful inventions (to reveal inventions to society so that others may replicate your process freely 20 years after you file your application, or via voluntary licenses).
US Patent Rights are the strongest Intellectual Property rights, compared to rights conferred under Copyright Law or Trademark law, for example. There is no Independent Discovery Doctrine in Patent Law, as in Trade Secret law, meaning that even if somebody independently discovers the same invention as a person holding a US Patent for that invention, the latter inventor's claim is invalid as to that same patent. There is no Reverse Engineering permitted under US Patent law. Generally, only a private Patent Holder may enforce violations of patent rights. A Patent does not grant the Holder the affirmative right to do anything with that patent, including the right to sell; it only grants a negative right, i.e., the right to exclude others from making, using, or selling your invention.
There are 5 "Patentability Elements" that need to be satisfied before an invention can be patented under US Patent Law. These are Subject Matter, Utility, Novelty, Non-Obviousness, and Description, as outlined below.
1. Subject Matter: Sec 101 of Patent Act: What kind of things you can get a patent for; a Patent may cover an “invention or discovery of any new and useful process, machine, manufacture, or composition of matter”; But, abstract ideas, mathematic formulas, laws of nature, undiscovered natural elements are not covered by Patents, as they are free to all men and reserved to none; Surgical Procedures are Not Patentable
a. Man-Made Living Organisms:
i. Chakrabarty, US Supreme Court ("USSC"): synthetic bacteria that breaks down components of crude oil, used for cleaning up oil spills; this synthetic bacteria was better than previous four naturally-occurring bacteria that were used because it’s more durable in all climates; US Patent and Trademark Office refused the product patent because no patents for living things. Court: you can patent living things that are man-made, but not those that are nature-made; the bacteria may be a “manufacture” or a “composition of matter”; Contrary argument said Plant Variety Act and Plant Act cover patents for various plants and for newly-created, non-naturally-occurring plants, but neither the Plant Acts nor Patent Act mentions synthetic bacteria; But this case opened door to biotech and GMO industry.
ii. US Patent and Trademark Office Advisory regarding Oncomouse: product patents for man-made higher order animals, e.g., mice, is ok, but not for creating man-made humans.
b. Purification Cases: separating out a substance from a pre-existing, naturally-occuring one
i. Parke-Davis, SDNY, 1911: regarding purified salt protein of adrenaline, called Adrenalin; Court approved process and product because the product is a purified form of adrenaline, and the purified product has a new, more efficient use beyond what nature provides; Split among Courts regarding Parke-Davis;
ii. For Example: if A creates Hormone Z via recombinant DNA process, and B creates Hormone Z via purification process, both may gain product patents for both of their versions of Hormone Z because the recombinant DNA version is a more pure version of Hormone Z, and thus they’re 2 different products. This is good, because otherwise, inventors would be demotivated to invent new processes of purification, and this would be against patent policy of promoting useful arts.
c. Computer Programs: are patentable
2. Utility: Patent Act, Sec. 101: “any new, useful process . . .”; an inventor only needs to provide a single use for his product, but his product patent covers all new uses; but this product patent does not provide you the right to exclude somebody from patenting a new use for that product via a “New Use Patent”:
a. Blocking Patents: Joe has patent for X and all its uses; Frank found new use for X, and to patent it, he must gain permission from Joe, and for Joe to use Frank’s new use,he must get permission from Frank!
b. Fashion: no utility!
c. 3 kinds of utility:
i. general: the invention must do something
ii. specific: the invention must do the function it claims to perform
iii. moral utility: a rarely used doctrine; causes conflicts between Federal Circuit’s determination of morality and state crime/tort laws; generally, invention must not confound the laws of society! (e.g., airplane patent of Wright Bros failed this test on first application)
d. Description of Utility: must be “specific, substantial, and credible” (e.g., can’t describe utility of a transgenic mouse as “snake food” to satisfy utility req.) so that those in the field will be able to understand and apply the invention without having to do too much work to do so.
3. Novelty: Policy is to ensure that the inventor hurries to patent his invention, and that the invention is new!
a. Sec 102a of Patent Act: invention must not have been used or known by others in this country, or patented or described in a printed publication in this or in a foreign country, before the invention thereof by the applicant for a patent; an inventor can’t self-block under 102a
b. Sec 102b of Patent Act: invention must not have been patented or described in a printed publication in this or a foreign country, or in public use, or on sale in this country, more than 1 year prior to the date of the application for the patent in the USA; an inventor can self-block under 102b (GATT Trips does away with 102b via “provisional applications,” which give “patent pending” status and require less than full description of invention, thus giving required notice to others; But 102b is still maintained under US law)
c. 18 month rule: does not apply to patents for USA-only-applicable inventions; 18 months after submitting an application, whether or not you get a Patent, the information is published in public; and then, one may not even get Trade Secrets protection for your invention because it’s general knowledge; but you can withdraw your application before the 18 months to avoid publication
i. Sandbagging: 18 month rule and 102b were created to stop sandbagging, which is where an inventor sits on his patents and waits for others to unwittingly invent and commercialize his same invention, and then the first inventor sues them for patent infringement, and collects retrospective license fees and 1% remedy damages;
ii. Submarine Patents: a new way of sandbagging, where first inventor applies for patent less than 1 year after the 2nd inventor’s invention enters the public use, and then bargains with 2nd inventor for balance between injunction losses and 1% remedy damages.
d. Duty of Candor and Inequitable Conduct: an inventor need not disclose a prior art that he doesn’t know about, even if the prior art is his own, so long as there is good faith; But inventors represented by attorneys are presumed to know the law and attorneys are responsible for the facts that are knowable, even if they are erroneous as provided by the inventor, and good faith is not a defense in such cases (In re: Roessler).
e. In re: Hall: invention was described in another person’s dissertation on file in a German University; this qualifies as prior publication, and causes 102b problem because it was published more than 1 year before filing for Patent; 102a and b are bright-line rules, and have no wiggle room; Court says “publication” is determined by whether at least one person in the field has access to the info
f. Alcoa: narrows Hall by saying that where there is a confidentiality agreement and government forces company to make such publications available, then there is no “publication” for 102b novelty purposes because the information was never “fully accessible” to the public.
g. Egbert v Lippmann: The “Corset” Case said any use by any person counts as public use; But Courts have narrowed Egbert to make it apply only to commercial use, and not for personal/private use; thus, revealing an invention to one person who uses it for commercial use will bar the patent if it was revealed more than 1 year before the application; but if confidentiality was asked for and set up by inventor, then generally the inventor is safe and has no 102b problem regarding public use; and generally, if an invention is stolen and the inventor took Reasonable Precautions, then he is safe.
h. Rubik’s Cube: private uses for personal enjoyment under the control of the inventor do not invalidate a patent under public use doctrine of 102b; inventor showed copy of Cube to his graduate school roommate, and this did not count as public use; but had he handed out copies of it to his friends, he may have had a problem, because he would have failed to take Reasonable Precautions (like Trade Secrets law).
i. City of Elizabeth v Pavement: inventor tests pavement in Boston for 6 years; Court: Testing your invention is a valid exception to the public use problem, especially where inventor did not sell the product during that genuinely experimental phase.
j. Airwick, 1983: regarding powdered carpet deodorizer given to 75 homeowners in 2 different forms of the product, and no confid’y agr’s; Court: this is not an experimental use because it is actually “market testing” (commercial use) and not experimentation; Experimentation Exception is applied restrictively because by stretching time before the product is released, it hurts society and other inventors trying to invent the same.
4. Non-Obviousness: Sec 103 of Patent Act: requires creative leap to move from prior state of the art to invention’s new level; this test is judged by a “person of ordinary skill in the art” (i.e., an Expert in the field)
a. Graham v John Deere, USSC: Court says that it can determine whether non-obviousness is satisfied, especially because the Federal Circuit is comprised of judges with scientific background, and because the US Patent and Trademark Office is composed of Experts; invention should generally be more than a collection of old, known mechanical elements (here, invention is too similar to prior art and is rejected: a box that is fixed in flipped position, versus a box that is flipped into that position to stop plow shake); Court sets 3 Prong Test to determine Non-Obviousness:
i. Scope and Content of Prior Art
ii. Similarity/ Difference between Prior Art and Claims at Issue
iii. Level of Ordinary Skill in the Art
b. USSC Secondary Considerations to Nonobviousness (Graham v Deere); USSC says may be valuable in determining Non-Obviousness:
i. Commercial success
ii. Long-felt but unsolved needs of marketplace
iii. Failure of others (most important consideration)
Two More Considerations added by Federal Circuit; Federal Circuit says are “objective evidence” and act as a required fourth element in the Sec 103 analysis, or at least act as plus factors, but these considerations should not be given determinative weight over the 3 elements outlined in Graham v Deere:
iv. Proof of copying attempts by others, and/or
v. Others acquiescing to your ownership by applying for licenses
5. Enablement/ Written Description/ Disclosure: Sec 112 of Patent Act: “the specification shall contain a written description of the invention . . . to enable any person skilled in the art . . to make and use the same”; Inventor gets 20 years of protection in bargained exchange for disclosure to others for benefit of market; “written description” clarifies whether the inventor actually possessed the invention at the time of the application;
a. UC Regents v Eli Lilly, 1997: inventor described the sequence of human DNA for insulin from his description of rat DNA, but failed to describe sequence via description of human DNA, and thus failed Enablement Test for human DNA; Sec 112 requires satisfaction of Enablement and Description;
b. the Possession requirement of Description can be satisfied via “Constructive Possession” (can show valid plans and drawings that would constructively reach the actual invention)
c. Gentry v Berkline: the “Reclining Chair Case”: Court: no new, significant matter may be added to the US Patent and Trademark Office application via amendments after the original application is made; Policy: to prevent broadening of the application beyond its original description in order to subsume competitors’ new, better, similar products;
d. U of Rochester v Searle, Federal Circuit, 2003: UR invented a test to find COX2 inhibitors, and Searle used that thest to create a drug, and UR said Seargle owes it royalties for that drug, and Court disagreed; Court said UR failed to describe that compound or to show how to make that compound without “Undue Experimentation”; enablement and written description reqs are separate stds and both must be satisfied; “possession” does not satisfy “written description” req of Sec 112;
e. Analog Claims: analogs are different molecules with almost identical chemical structure that behave in almost the same way
i. Amgen v Chugai, Federal Circuit, 1991: inventor claimed a product patent for a protein EPO and all its analogs; Court: this is an enablement problem because there are millions of analogs that the inventor has failed to enable via his description, and so Court invalidated the analog claims; but post-Gentry, this is framed more as a Description problem.
ii. Today, in Analog Cases, Court allows analog claims so long as the inventor’s description does not require “Undue Experimentation”
iii. In re: Wands: the “Undue Experimentation Doctrine” applies in both the “enablement” and “written description” aspects of Sec 112: 1) has the inventor enabled others with enough information to avoid “undue experimentation?”, and 2) has inventor provided enough “written description” to avoid “undue experimentation?”; Critics of this doctrine say this is a distinction without a difference, because they both serve the same purpose, which is to avoid “Undue Experimentation”; but Gentry says that one can enable without providing a written description, and vice versa!; Split among Courts on having 2 parts to this doctrine.
iv. Atlas v Du Pont: DuPont said it tried to reproduce Atlas’ invention via its description, and it failed; Court sided with Atlas and said just because DuPont lacked the skill to reproduce the invention does not mean Atlas’s description, and thus patent, is invalid, because DuPont lacked the required “ordinary skill in the art.”
f. Literal Infringement vs. Doctrine of Equivalents: these are two separate causes of action which can generally be argued in the alternative; if first fails, try second.
i. Literal Infringement: Larami Corp v Amron: “The Super Soaker” Case; A Patent can have numerous claims, and Every claim in a patent can have numerous elements; Because every element of a claim is essential and material to that claim, a Patent owner must show the presence of every element (or “its substantial equivalent” in “Doctrine of Equivalents” cases) in the accused device; if even one element of a Patent’s claim is missing, then there can be no infringement as a matter of law; e.g.: if your claim has 5 elements, and another’s has 4 of your 5, then the other’s claim infringes yours.
ii. Doctrine of Equivalents: Warner-Jenkinson, USSC: Doctrine of Equivalents is limited by “Prosecutorial History Estoppel” (i.e., once the patent holder gave up the prior version of the element in order or necessarily to acquire the patent, then that prior version can’t be summoned to claim infringement; when there is no evidence either way, the Court applies a rebuttable presumption that the patent's description's limit was drafted intentionally to avoid the prior art, and Patent Holder may rebut this presumption; and USSC in Festo says that when the Patent Holder makes a change in the language of an element, the Reasonable Applicant could not have foreseen that it would estop him from applying the Doctrine of Equivalents against a future accused infringer: the “Foreseeability Test” should be applied: 1) the change was made before further developments in the technology, 2) the reason for the change bears only a tangential relationship to the element, and 3) some other valid reason); Doctrine of Equivalents is more broad than “literal infringement”; Doctrine of Equivalents has nothing to do with intent; a Patent covers what it covers, despite Bad Intentions, and if there’s no infringement, then infringer may have a defense; USSC validated either of the 2 Tests for the Doctrine of Equivalents:
1. Triple Identity Test: if the accused and patented products are the same in all 3 ways, then there’s infringement:
a. Function served by the element
b. The way the element serves that function
c. Result of that function
2. OR, can use the Insubstantial Differences Test, which looks at the elements of a claim and compares them to see whether the differences between the two products are insubstantial, and if they are, then there’s infringement.
Other Topics regarding Patents:
1. done before the US Patent and Trademark Office
2. Challenges of the US Patent and Trademark Office can ultimately lead to the Federal Circuit and the USSC
3. 3rd parties can challenge prosecution of patents.
4. all relevant information that the claimant wishes the US Patent and Trademark Office to consider in determining Patentability must be included in the original application, and all addendums that are made after the final US Patent and Trademark Office determination are barred from later entering litigation of the US Patent and Trademark Office’s decision (e.g., Graham v John Deere); an issued patent enjoys a presumption of validity, and that can be overcome via clear and convincing evidence.
Patent Infringement: 2 elements, and Defendant can deny each or both of these:
1. ownership of a valid Patent
2. use, sale, import, etc. of a constituent element of a valid Patent.
Defensive Patenting: method of patenting all processes that lead to a product in order to create a legal monopoly (e.g., electric car to preserve combustion engine car)
Markman Suits: Role of Judges in Patent Litigation: Markman, USSC: claim construction is a matter of law, and only judges, not juries, may interpret patent claims; Juries can determine whether a claim, as interpreted by a judge, covers the infringer’s claim, can determine remedies, and can interpret claims only regarding Doctrine of Equivalents cases; when separate, alternative causes of action are brought regarding Literal Infringement and then Doctrine of Equivalents infringement, these are called Markman Suits.
Defenses to Infringement:
1. Patent Misuse: an equitable doctrine, and Affirmative Defense to an infringement cause of action, saying that the Patent Holder has misused the patent by
a. either fraud on the US Patent and Trademark Office, or
b. Impermissibly attempting to Expand the Time or Scope of the patent via K, e.g., a patent lasts 20 years, but the patent holder gives a license to use the invention for 50 years; such K’s are patent misuse and thus may be Unenforceable (Contrast with Trade Secrets Law and Listerine case); But the Patent Holder can defend the validity of the K by saying that the 50 years of license fees are part of an extended payment plan, or that the payments made after the 20 years of Patent Duration are made for use of Trade Secrets, which is what Patents may become when they die, assuming they are not generally known or readily available (hard to argue, though, given that Patents are published); or
c. Price-Fixing/ Tie-In Sales: Antitrust violations may qualify as patent misuse; and in theory, bad behavior does not have to rise to level of antitrust violations to qualify as patent misuse; the Defendant who uses the defense of Patent Misuse does not need to show injury to himself, but only injury to somebody, because a patent is a public grant, and if the Patent Holder is behaving badly, then Court will find Patent Misuse in order to promote Equity.
2. Doctrine of Exhaustion: once a Patent Holder sells a patented item, he’s exhausted his rights to it, and thus can no longer control nor license it; Malacrot, USSC: as long as a sale is not an “absolute sale,” Patent Holder can still control/ restrict the products; sales with restrictions are “conditional sales” or “licenses,” and sales without restrictions where absolute property rights are yielded are “absolute.”
3. Experimental Use Defense regarding Purpose of Infringement: totally Different test than that used in City of Elizabeth v Paving (which is about Prior Public Use).
a. Maddy v Duke: After Prof. Maddy quits his post at Duke University, Duke keeps using his patented lab equipment, and Maddy sues for infringement; Duke claims “Experimental Use” Defense; Warner-Jenkinson said Intent is irrelevant in Patent Infringement in Doctrine of Equivalents cases, and so Maddy says it’s irrelevant whether Duke intended to infringe or not; But Court says intent to copy for purposes of Doctrine of Equivalents is different from intent to use product commercially or experimentally, because this case is about the “Purpose” of Infringing, and not the Intent!; and this is not a Doctrine of Equivalents case like Warner-Jenkinson; Court says the use is Commercial if it “furthers the institution’s legitimate business objectives,” and whether a business is for-profit or non-profit is Irrelevant for such a determination; Court creates a very restrictive defense, stating “Experimental Uses” are for “idle curiosity, amusement, or philosophical purposes,” and very few things would actually fit such purposes (e.g., a garage hobbyist with no intentions for commerce); as a result, Duke’s Experimental Use Defense failed, because there’s no way it could fit the Purposes of its academic activities into the confines of such a restrictive test as this; Still many academics fail to respect Patent Rights in their research, despite the law.
Remedies for Patent Infringement:
1. Injunctions and Damages are both available, and give Patent Holder some bargaining leverage in settlements
2. Patent Holders cannot be compelled to license their inventions; Patent Holder may choose to shut down the infringer via an Injunction, and Patent Holder has no obligation to ever market his product.
3. Damages are available for the period of the actual infringement, and damages are based on “lost profits” and “reasonable royalties”
a. Lost Profits – what Patent Holder would’ve made in the market if infringer weren’t already selling the product
b. Reasonable Royalties – what Patent Holder should receive that would allow the infringer to continue selling the product
4. In assessing damages, the amount is not technically determined by the actual profits the good businessman/ infringer made; although in practice, it may turn on that amount.