Validity a Valid Patent Must Claim Subject Matter That

Patents – Fall 2009 1

Patents Outline

Validity – A valid patent must claim subject matter that…

(is) Patentable Subject Matter (§101)
Process Claims – Tests: F-W-A test for algorithm PSM, Useful-Concrete-Tangible Results for methods Machine-or-Transformation for methods
(has) Utility (§ 101)
Operability – works for claimed purpose
Beneficial Utility – produces some social benefit
Practical Utility – presently useful, not vague or meaningless
(meets) Disclosure and Enablement Requirements (§ 112):
Enablement: PHOSITA can make & use, Spec  claim w/o undue experimentation?
Written Description: PHOSITA is convinced of patentee’s possession upon reading
Definiteness: PHOSITAknows what is claimed (w/in 4 corners of spec and own knowledge)
Best Mode: PHOSITAenabled to practice best mode of invention
(meets requirements of) Novelty (§ 102)
§ 102(a),(e),(f),(g)
(is not barred by prior art) Statutory Bar (§ 102)
§ 102(b),(c),(d)
(meets requirements of) Obviousness (§ 103)

Infringement

Types: § 271
Direct infringement – § 271(a)
Make, use, offer to sell, sell with US or import
Secondary liability
Inducement– § 271(b)
Contributory infringement– § 271(c)
Territorial liability
Export infringement – § 271(f)
Import infringement – § 271(g)
(1) Claim construction – Interpretation of claims
(2) Comparing element-by-element of each claim to accused device
Literal infringement, or
Doctrine of Equivalents (DOE) possible bar by Prosecution History Estoppel (PHE)

Defenses

Patent has presumption of validity:
“Clear and convincing” evidence required
Validity
Exhaustion Doctrine, Repair (not reconstruction)
Inequitable Conduct
Failure to disclose material info (non-cumulative, relevant PAR; litigation & legal proceedings)
Rule 56 Duty to Disclose (patent agent, attorney, paralegal, inventor, party involved—all levels of management aware of prosecution proceedings)
w/ intent to deceive (must be greater than gross negligence, requires conduct+intent)

Remedies

Injunctions: Permanent and Preliminary
Money Damages
Royalties
Lost profits
Treble damages to deter willful infringement

Introduction

Patent Bargain:

Inventor gets:
Limited monopoly (20 years from date of initial patentapplication)
Exclusive rights for a limited time (right to exclude others from making, using, offering for sale, selling)
Society gets:
Innovation  Progress of useful arts
Discoveries
Disclosure (of invention to public)
Result: paper document  patent

Types of Patents

Utility – PSM defined in 35 U.S.C. § 101
Design – subject matter defined in 35 U.S.C. § 171
Only last 14 years from date of grant
Protection afforded limited to ornamental features, cannot encompass primarily functional features
Provisional—early draft
Does not convey same rights as final patent
Acts as placeholder for priority date
Plant – subject matter defined in 35 U.S.C. § 161

Claims

Claim = single-sentence definition of the scope of patent owner’s property right
Gives meets and boundaries of the patent, circumscribes the invention
Parts:
Preamble – introduces & identifies the basic nature of the invention
Transition – defines claim’s breadth
Open claim – “comprising”
Product will infringe even with presence of additional elements
Closed claim – “consisting of” (more narrow than ↑)
No infringement if additional elements exist
In-between – “consisting essentially of”
Additional elements prevent infringement only if they make product “essentially different”: fundamental additions fall outside scope of claim
Body – most important part
Two functions:(1) Lists all elements of invention, including limitations and (2) Describes their interaction
Types:
Independent Claim – typically start w/ this, no limitations—broader in scope
Dependent Claim – builds on elements set forth by independent claim, adds more limitations/elements
More likely to be allowed b/c more specific  more likely to get around prior art
Jepson – explicitly stated as improvement upon existing claim, “wherein improvement comprises”
Markush – used for chem. & biotech inventions, “Markush groups” claim class of chemical compounds in terms of structural formula  “composition C2H5-R where R comes from X, Y, or Z”
Strategies in claim drafting:
(1) Make as broad as possible  carve out large scope
(2) Avoid infringing prior art  narrow scope to avoid prior art
Easiest way to broaden is to take elements away and remove reference to specific elements

A valid patent must claim subject matter that is (Administrative Process):

Within one of the statutory categories (§101) PSM
Useful (§101)
Adequately disclosed and precisely claimed (§112)
Novel (§102)
Not barred by prior art (§102)
Nonobvious over the prior art (§103)

Enforcement of a patent requires (Judicial Process):

Valid patent
Patent is infringed, either literally or by Doctrine of Equivalents
Patent rights enforceable, i.e. not lost by Inequitable Conduct (during prosecution or due to misleading behavior or delay)
…Entitling the patentee to an injunction or monetary damages

Globalization

Patent rights are territorial and national in nature  domestic right

(1)Procedural harmonization

Paris Convention – created a system of mutual respect regarding priority dates
PCT – Patent Cooperation Treaty
Treaty that allows a single international application to be filed to establish priority date
Can specify at which stage (international v. national phase) at which inventor wants application to be examined
Expense can vary depending on choice
~100 participant countries worldwide
EPC – European Patent Convention
Offers EP app that can be submitted to EPC, single office does prior art search, once prosecution complete, patent is valid in all EPC member countries
Only 36 European countries participate

(2)Substantive harmonization

Trade Related Aspects of Intellectual Property (TRIPs) = side agreement to the WTO
When US agreed to TRIPS, changes to US patent system made:
Provisional application introduced
18 mo publication of application
Duration of patent = 20 yrs from filing versus older standard – 17 yrs from issue
takes away incentives to delay prosecution process
May be extended in 2 ways: (1) FDA delays or (2) PTO delays

PATENTABLE SUBJECT MATTER (PSM) – § 101
§ 101 requirements are a threshold to patentability
Four statutory categories of PSM (set forth by In re Nujiten):

(1)Process (or method) = series of steps to carry out a given task

Method of making stuffed-crust pizza or Amazon’s “one-click” ordering system

(2)Machine (or apparatus) = a concrete thing, consisting of parts, or of certain devices and combination of devices

Internal combustion engine

(3)Manufacture = “catch-all” category for man-made subject matter w/o moving parts having been encoded, generated, and transmitted byartificial means

Insulating sleeve for hot drinks

(4)Composition of matter = “all compositions of two or more substances and allcomposite articles, whether they be the results of chemical union, or of mechanicalmixture, or whether they be gases, fluids, powders or solids” Chakrabarty

Chemical compositions or mixtures of substances such as metallic alloys

Whether a claim is drawn to PSM is a question of law, standard of review = de novo

What is PSM according to case law in…

Biosciences
Chakrabarty – Invention: man-made oil-eating bacteria created in lab
SCOTUS:
NOT PSM: “Manifestations of nature”:
Laws of nature,
Natural and physical phenomena,
Abstract ideas
Products of nature
PSM:
Products of human ingenuity, even if living (not merely discovered);
Non-naturally occurring “products of nature”  made by man;
Living things, found in nature, if only occurs
Funk Brothers (1948) – Invention: Combination of different strains of existing bacteria
SCOTUS: Elements each exist in nature w/o human interaction
NOT PSM:Mere discovery, non-”inventions”
PSM: Non-obvious innovations
SCOTUS favors invention requires discovery + something extra (creative process, inventiveness) to put it across the line into PSM (here, mere mixing ≠ creation)
Parke-Davis (1912) – Invention: Purified adrenaline in an “isolated and concentrated form” (isolated and concentrated not covered by prior art)
SCOTUS: Purified adrenaline = new product, had never been seen in this form b4
PSM:
Naturally-occurring substance, when “purified and/or isolated”  completely new product;
“New thing chemically & therapeutically”
Plants
Dissent of Chakrabarty: we should not allow for patenting of living things b/c we have these other protections:
Plant Patent Act (PPA) of 1930 protects plants
Covers asexually reproducible plants
Single claim
Closer to copyright protection: (1) Easier to get and (2) Limited protection
Individual creation is defense
Scaled down enablement and written description requirement
Plant Variety Protection Act (PVPA) of 1970 plant variety certification
Covers sexually reproducible plants
Product of international agreement (no reference to Patent Act)
Scaled down enablement and written description requirement
Administered by Department of Agriculture
Experimentation is excused from infringement
Software
Issue: Idea v. Algorithm—where to draw the line?
NOT PSM: Ideas and abstractions (including unapplied mathematical algorithms)
PSM: Algorithm = steps to implement and apply an idea, maybe PART of a method or process patent
Trend: Patentability of software being questioned
Benson (1972) – Invention: Method for converting binary-coded decimal numerals into pure binary
SCOTUS: shoots down Machine-or-transformation test as the ONLY test for method patent PSM
Freeman-Walter-Abele Test for algorithms: Method claim is NOT PSM when
Claim states a mathematical algorithm, and
Grant of patent would “wholly preempt” use of the algorithm by another party (party would be infringing patent if they used the algorithm)
Followed by Parker v. Flook (1978) – Method of calculating alarm limit is NOT PSM b/c too disembodied, abstract (not tied to physical object, foreshadows M-o-T test)
Diamond v. Diehr (1981) – Invention: method of curing rubber  tangible (procedure)
SCOTUS: Software is PSM b/c process results in physical transformation of an article to a different state or thing
Doctrine of Magic Words: trend towards drafting patents to get around § 101 limitations emphasize transformation (make it sound as much like a physical change as possible)
Start w/ something that sounds like Benson and tie it to something physically tangible (computer machine)
Fewer method claims, more machine and system claims
In reBeauregard (Fed. Cir. 1995) – manufacture claim for “software contained on a floppy disk” (or other tangible medium) held valid (problem: downloading)
State Street Bank & Trust Co. v. Signature Financial Group (Fed. Cir. 1998)
Invention: hub & spoke financial system to monitor & record financial info flow
Claim: “data processing system”  system (machine) claim
Strategy—phrasing tied to a physical machine, makes it sound more like a process
Even though there is a computer mentioned, it is still basically claiming a method b/c the computer is used to carry out the specific method
§ 112, ¶ 6 – Means + function “means for”
Machine claim Where the structures necessary to carry out (means) the function are described in the written specification
Method claim Where the structures required (means) to carry out the function are NOT disclosed
SCOTUS: Practical utility (usefulness) is the most important aspect in patentability
Useful-Concrete-Tangible Test for Method Claim PSM(from Alappat)
Transformation of data is patentable if it results in a “useful, concrete & tangible result” (All 3 requirements must be met)
Useful – Produces something that has utility, easy standard to meet—must be useful to SOMEONE
Concrete – End product of method can be data, but impact on data must be clear  #s as a result are sufficient
Tangible – Takes transformation out of the requirement  no longer need a physical transformation as long as the end result is tangible
Opened the floodgates to patenting of business methods
Business Methods
State Street Bank & Trust Co. v. Signature Financial Group (Fed. Cir. 1998)
Lower courts typically frown on patenting these, but UCT requirements from State Street met
Long established principle that business methods are not PSM rejected – business methods claims to be treated like any other method claims
Congress reacts: enacts 35 U.S.C. § 273(b): Defense to infringement exists if:
In good faith,
Applicant reduced to practice at least one year before effective filing date, &
Commercially used subject matter before effective filing date
 infringement defense
No prior invention required!
In re Bilski (2009)
Claimed invention: “method of hedging risk in the field of commodities trading”
Issue: Are applicants seeking to claim a “fundamental principle” (abstract idea = not PSM) or a mental process
SCOTUS gets rid of useful, concrete & tangible results” test and FWA
New Standard for PSM in process claims:
Machine or Transformation Test – Claimed invention must be tied to physical machine or significant transformation of data from one form to another to be PSM by § 101
Only other uses involving same machine will infringe
Standard represents the boundary btw unpatentable abstract ideas (and mental processes) and the patentable application of these ideas
Not the ONLY test for business methods
Three types of “Transformation”:
Physical objects PSM
Signals/data that represents physical objects  on the fence, borderline and debatable
Abstract concepts NOT PSM
Limitations:
Cannot constitute mere insignificant post-solution activity  cannot just add an additional step to the end of an already patented process and patent as something new
Must impose a meaningful limitation on the claim scope

Objections to patenting BMs / Benefits to patenting BMs

Mental processes/personal interactions should not be patentable
§ 102 / § 103 – prior art and obvious to combine  already in use already! Duh, it’s useful
Embody unpatentable “abstract ideas”
Foreclose the possibility of patenting anything else around it b/c so abstract  unclear what is claimed
Scope of exclusion is too broad
Language / expression of business methods make them hard to examine

Innovation incentive
“Real ingenuity” and improvements encouraged
Disclosure of possibilities to the public  catalogue
Signaling purposes

Utility
Utility = issue of statutory interpretationissue of law reviewed de novo
BUT –In re Fisher – whether an application discloses a utility is a question of fact
Statutory basis:
§ 101 – “…or any new and useful improvement thereof…”
§ 112 – “…manner and process of making and using it…”

Credible Utility / Operability–claimed invention has to workas claimed for its intended purpose
Outlier examples:
Things that defy common sense (time machine or perpetual motion machine)
Method to cure baldness  only credible if it works
3 steps PTO uses to assess/challenge utility: (1) Application given presumption of operability, (2) PTO can rebut based on evidence PHOSITA would doubt operability, (3) Applicant can rebut PTO’s evidence
Policy: do not want to waste PTO’s time—ends must justify means—and protect society against fraud (expectation that what they read from the patent will work)

Beneficial (Moral) Utility– must produce some social benefit or use
Lowell v. Lewis (1817) – Invention has a practical use that isnot frivolous or injurious to society
No requirement for improvement over prior invention
Very permissive standard—PTO does not judge invention’s quality or marketability (if not useful, it will go away on its own)
Juicy Whip v. Orange Bang (Fed. Cir. 1999) – Drink dispenser  deception is okay as long as there is still real world value
No requirement that invention be “honest” as long as it is legal
Practical (Specific & Substantial) Utility – must be presentlyuseful for specific purpose, not so vagueor generic at moment of patenting that it is meaningless (patentable invention must have real-world use)
Depends heavily on predictability of art area – if much known about art area, more likely to be able to push boundaries of what is practical (mouse trials v. need for human trials)
Brenner v. Manson (1966)
Claimed invention: a process to make a steroid (at time of invention, steroid’s purpose and use is unclear)  Application rejected
If the result of a process has no known utility at time of filing, the process itself has no utility
 “Red Ant Utility” = idea that general utility (like a process to kill red ants) is not practical or specific enough to grant patent
“A patent is not a hunting license”
Policy on timing of awarding patent:
If award too early, everything in the future is claimed w/o specificity
If award too late, requires too much work to achieve the patent, not enough incentive to entice inventor to apply for a patent b/c work/money/time involved outweighs the value of the patent
In re Brana (Fed. Cir. 1995)
Only knowledge at time of application came from mice models
Fed Cir says promising results from testing on mice cells is enough to predict success in humans  predictive capabilities supported
Unless there is a reason to doubt credible utility, presumption stands
New guidelines for practical utility:
Specific Utility – specific to subject matter, not general to entire category from which the invention arises (specific to chem or bioscience invention)
Substantial Utility – utility must be known at time of patenting, must not require further development or research of the discovery in order to become useful
In re Fisher (Fed. Cir. 2005)
Claimed invention is specific group of ESTs—lists generic benefits of ESTs overall, not specific to the ones claimed
FC: benefits not specific enough to claimed invention to justify granting of patent
EST art area still too unpredictable to allow granting of patent based on generic claims

Disclosure & Enablement requirements
Come from § 112 disclosure requirements
Disclosure = incentive and motivation to further improve existing technology
Price the inventor pays in exchange for gaining the benefit for the right to exclude
Purpose is to apprise public of what is still open to them to improve/invent

(1) Enablement

Purpose: Inventor must describe invention clearly enough so PHOSITA can understand it well enough to make and use the same at time application filed
Look to both written specification (background of invention, detailed description, examples, data) AND drawings
Cannot burden PHOSITA w/ undue experimentation to achieve same results
Ex: Patent is not enabled if it only states substances and relative ratios of materials to be mixed, must include actual quantities
Scope of enablement must be at least equally broad as scope of claim & scope of claim must be commensurate to scope of specification
Question of law (reviewed de novo)
Policy:Patentee should not get exclusionary rights covering anything that already existed in public domain prior to their work
TEST: Does the invention (spec + claims), as understood at the time of filing, enable PHOSITA to close the gap btw what is described in the spec to the what is claimed? (no undue experimentation allowed)
Factors to consider:
Amount of necessary experimentation
Predictability v. unpredictability of the art
Presence v. absence of working examples
Nature of invention, stat of the art (area)
Amount of direction/guidance provided
Relative skill in the art
Breadth of claims
Undue Experimentation – depends on predictability of art area
Genus-Species claiming = method for expanding from what is described in spec to what is claimed (goes from smaller to larger group)
Predictable art area – field well understood  gap btw spec and claims can be larger b/c reasonable to assume that PHOSITA can bridge w/ common knowledge
Unpredictable art area – area not well known, PHOSITA does not know how to get from point A to point B w/o guidance and requires more description in written spec  gap btw spec and claims must be smaller
Incandescent Lamp Patent (1895)
Sawyer & Man’s patent claims whole category of wood materials for required carbon-based filament (includes over 6K materials)
Edison ruled not to have infringed b/c spent long time experimenting to find specific working material—bamboo
Patentee’s claimed carbonized “fibrous or textile material” not actually “successful”  actually used Edison’s bamboo
Scope of enablement = that which is disclosed in spec + scope of what would be known to PHOSITA w/o undue experimentation
PHOSITA cannot hinge on knowledge of a single extraordinary individual (Edison’s knowledge not equivalent to PHOSITA), must be an average man skilled in the art
Validity viewed on claim-by-claim basis  do not compare a claim from one patent to a claim from another patent—just hold claim to PHOSITA standard
Amgen v. Chugai (Fed. Cir. 1991)
Amgen claims all EPOs when spec only disclosed how to make and use a few (that did not work for what patent claimed)
 Lack of enablementbased on lack of predictability—not enough detail available for PHOSITA to repeat results w/o undue experimentation
Must bridge gap btw spec and claims by: (1) expanding spec, (2) narrowing claims
In re Strahilevitz (CCPA 1982)
Process patent for removing antigen from bloodstream, applicant hadn’t yet created actual embodiment, but patent granted
A single, specific example of work is not required to meet a § 112 enablement requirement, but it does provide good evidence that the disclosure is enabling
Undue experimentation” standard is measured relative to “process” claimed  here spec makes is clear that the selection and preparation of related haptens, antigens, and antibodies involved routine and well-known techniques
Examiner himself referenced prior art w/ techniques disclosed
Example of Prophetic Example—some applications of known techniques are so predictable that they can be “prophesied” by PHOSITA
Blocking Patents = Situation where one pioneer patent covers a broad field of technology and a subsequent patent covers an improvement in the field
Timing
Inventor can properly claim broad subject matter as long as her research enables one skilled in the art to make and use her inventionas that invention was understood at filing date
Enablement always addressed relative to a PHOSITA’s understanding at the time of filing
Infringement deals w/ coverage of the claim determined at the time of the alleged infringement
“Reverse Doctrine of Equivalents” – Where an improvement is really quite beyond the scope of the original invention altogether, the improvement will not even be describable in the terms of the original patent’s claims  will not infringe on earlier claim (not really applied much now)
Temporal Paradox
Enablement standard – PHOSITA’s understanding at time patent application filed
Infringement standard – PHOSITA’s understanding at time of infringement

(2) Written Description