Its Best to Disclose Best Mode

Go Medical Industries PTY, Ltd v. Inmed Corp., [05-1241, -1267, -1588](October 27, 2006)[MICHEL, Archer, and Linn] The Federal Circuit affirmed invalidity of Go’s patent on a urinary catheter on the grounds that the inventors failure to disclose the best mode in the priority application prevented Go from claiming priority to the application. The inventor admitted that certain dimensions were critical to the invention, and that he avoided any comment about the length because he was “aware that the numbers would become limiting themselves”. The inventor further testified that it too a few weeks experiments to define the dimensions, which supported the conclusion that the best mode was indeed omitted from the priority application.

Arbitration Might be Better Than Litigation, If It Weren't For All the Litigation Surrounding Arbitration

Qualcomm Incorporated V. Nokia Corporation, [06-1317] (Fed. Cir. 2006)[PROST, Newman, Schall] The Federal Circuit vacated the district court’s decision denying Nokia’s motion to stay the litigation pending arbitration between the parties.
SIGNIFICANCE: When the parties incorporate the AAA Rules, they are vesting primary authority to determinarbitrabilityty with the arbitrator.
BRIEF: At issue, ironically is who should decide the arbritrability of a dispute the district court or the arbitrator. To stay the litigation, the district court must be "satisfied" of the arbitrability of an issue pursuant to section 3 of the FAA. To make this decision 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 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 should undertake a full arbitrability inquiry in order to be "satisfied" that the issue involved is referable to arbitration. If, however, the court concludes that the parties to the agreement did clearly and unmistakably intend to delegate the power to decide arbitrability to an arbitrator, then the court should perform a second, more limited inquiry to determine whether the assertion of arbitrability is "wholly groundless."
The Federal Circuit concluded that the parties did intend to give primary power to determine arbitrability to the arbitrator, and thus the district court should have, but did not, consider whether the assertion of arbitrability was "wholly groundless." Thus the Federal Circuit remanded the case for this determination.

A Plant Variety Name is Generic and Cannot be a Trademark

In Re Pennington Seed, Inc., [06-1133](Fed. Cir. 2006)[LOURIE, Michel, Ellis] The Federal Circuit affirmed the TTAB’s affirmance of the Examiner’s refusal to register the plant variety name REBEL as a trademark. Applicant had previously designated the term “Rebel” as the varietal (or cultivar) name for a grass seed that was the subject of a plant variety protection (“PVP”) certificate, issued on May 14, 1981. The Examiner refused registration based upon a long standing precedent that the varietal name was the generic term for the plant. The Federal Circuit found no error in the refusal of registration on grounds of genericness.

Reissue Can Correct Any Error

Medrad, Inc. v. Tyco Healthcare Group LP, [06-1082] (Fed. Cir. 2006) [LINN, Michel, Archer) The Federal Circuit reversed summary judgment that plaintiff's Reissue Patent was invalid for violation of 35 USC 251.
SIGNIFICANCE: Reissue can be used to correct any error in a patent that results in claims broader or narrower then they should be.
BRIEF: Medrad reissued its patent, but in the process corrected additional errors that were not supported by its reissue oath. When Medrad sought to enforce its reissued patent before the ITC, the reissued patent was held invalid. Medrad reissued the patent again to provde the necessary supplemental declaration. When Medrad sought to enforce the twice reissued patent against Tyco, Tyco aruged that the absence of the supplemental declaration was a procedural defect that could not be corrected under 35 USC 251. The Federal Circuit determined that 35 USC 251 can be read to "encompass any error that causes a patentee to claim more or less than he had a right to claim." Given the remedial nature of the statute such a liberal construction was entirely appropriate. Without an express indicatino from the statute, the Federal Circuit was hesitant to adpot further limitations on the types of errors that are correctable under 35 USC 251.

If You Don’t Know, Then Deny

El Encanto, Inc. V. La Tortilla Factory, Inc., [06-1198](Fed. Cir. 2006) [MICHEL, Lourie, Schall] The Federal Circuit affirmed the TTAB’s dismissal of an opposition because Opposer failed to introduce two of its registrations critical to the outcome.
SIGNIFICANCE: A denial for lack of knowledge is a denial, and a plaintiff must remember to prove all the elements of its case.
QUOTE: “While it is true that the law favors judgments on the merits wherever possible, it is also true that the Patent and Trademark Office is justified in enforcing its procedural [rules].”
BRIEF: The Opposer argued that the registrations should be considered because applicant had full notice of the registrations, since they were referenced in the Notice of Opposition, and attached as Exhibits, but Applicant’s answer stated that applicant was without sufficient information, and denied the allegations. The Federal Circuit said that “denials based on lack of knowledge or belief are valid denials” they effectively put the opposer on notice that its claim was being challenged, thereby requiring the opposer to prove its case. The Federal Circuit found that Opposer was on notice that it would have to prove its case, yet opposer failed to take any of the alternative measures to introduce the registrations into evidence, such as take testimony or file a notice of reliance on the registrations, provided for in 37 C.F.R. § 2.122(d)(2).

Recapture Requires Deliberate Surrender to Overcome Prior Art

Medtronic, Inc. v. Guidant Corp., [05-1515] (Fed. Cir. 2006] [SCHALL, Michel, Dyk] The Federal Circuit affirmed the district court's determination that plaintiff reissue patent relating to cardiac pacing did not violate the recapture rule.
SIGNIFICANCE: The fact that claims that originally covered the accused device were amended to exclude the accused device, does not mean that reissued claims that do cover the accused device violate the recapture rule.
The Recapture Rule prevents a patentee from regaining through reissue subject matter that was surrendered during prosecution of the original patent in an effort to obtain allowance of the original claims. The surrender can occur either by amendment or argument. The recapture rule is applied in a three step process:

1. it is determined whether, and in what respect, the reissue claims are broader than the original claims
2. it is determined whether the broader aspects of the reissue claims relate to subject matter surrendered in original prosecution
3. it is determined whether the claims are materially narrowed in other respects so that the claims have not been enlarged and thereby escape the recapture rule.

Whether claims of a reissued patent violate 35 U.S.C. 251 is a question of law. The legal conclusion of whether an applicant has met the statutory requirements of 35 USC 251 is based on underlying findings of fact.

The Federal Circuit found that some of original claims did not cover the embodiment allegedly "recaptured" and thus the recapture analysis need not include those claims, but the Federal Circuit did find two claims that did originally cover the allegedly recaptured embodiment. However, the fact that the claims originally covered certain subject matter, and were amended in a way that excluded that subject matter, does not necessary mean that reissuign the patent to cover that subject matter is a recapture. In considering whether subject matter was surrendered the Court must look at whether there was a deliberate widhdrawal or amendment to secure the patent, because reissue does not remedy deliberate action. Examining the circumstances, it appeared clear to the Federal Circuit that the attorney and the examiner were mistaken about the scope of the invention. The Federal Circuit further noted that there was no evidence that the embodiment was surrendered to overcome a prior art rejection. For similar reasons the Federal Circuit also found no surrender by the arguments of counsel.

Judge Dyk, in dissent, argued persuasively that an objective observer viewing the prosecution would have concluded that a deliberate surrender had occured as to at least some of the claims.

New Trademark Dilution Law Signed by President Bush

On October 6, 2006, President Bush signed legislation that fixes the trademark dilution provisions of the Lanham Act by adopting a liability standard of likely dilution rather than actual dilution (in resposne to the Supreme Court's decision in Moseley v. V Secret Catalogue, Inc., 537 U.S. 418 (2003)) and providing injunctive relief for uses of a famous mark or trade name in commerce “that is likely to cause dilution by blurring or dilution by tarnishment, regardless of the presence or absence of actual or likely confusion, of competition, or of actual economic injury.” The legislation also provides definitions for a “famous mark,” “blurring,” and “tarnishment,” and clarifyies that protection does not require inherent distinctiveness, that tarnishment is actionable, and that marks known only in niche markets are not covered.

No Double Recover for Patent and Trademark Damges for the Same Infringing Product

Aero v. Intex and Wal-Mart (Fed. Cir. 2006) the Federal Circuit affirmed the judgment that a patent on the valve for an air mattress was not invalid and was infringed, and that the trademark was infringed, but reversed the damage award for both patent and trademark damages.
SIGNIFICANCE: The owner of a patent and a trademark both of which are infringed by the same product, may not be able to recover on both properties.
BRIEF: The words of a claim "‘are generally given their ordinary and customary meaning.’" The ordinary and customary meaning of a claim term is "the meaning that the term would have to a person of ordinary skill in the art in question at the time of the invention, i.e., as of the effective filing date of the patent application." The claims themselves provide "substantial" guidance as to the meaning of claim terms. The claims must be read in light of the specification, the "‘single best guide to the meaning of a disputed term.’" A court should also consider the patent’s prosecution history, the prosecution history "can often inform the meaning of the claim language by demonstrating how the inventor understood the invention and whether the inventor limited the invention in the course of prosecution, making the claim scope narrower than it would otherwise be."
The Federal Circuit reiterated the test of indefiniteness: If a claim is not amenable to construction, the claim is invalid as indefinite under 35 U.S.C. § 112, ¶ 2. If a claim is amenable to construction, "even though the task may be formidable and the conclusion may be one over which reasonable persons will disagree," the claim is not indefinite. The Federal Circuit went above and beyond to salvage the "less-than-perfect" wording of the claim. The claim recited "a
a one-way valve . . . providing a substantially hermetic seal" with structures that upon inflation "provide a complete hermetic seal when the valve is in the closed position". To construe "complete heremetic seal" to mean complete, where the claim also said the seal was a "substantially hermetic seal" would render the term substanially "illusory". The Federal Circuit contrived an explanation of how its construction did not similarly render "complete" illusory.
Regarding the duplication of damages, the Federal Circuit said that Aero was fully compensated for defendants’ patent infringement when it was awarded a reasonable royalty for patent infringement based on sales of the infringing mattresses. It could not also be awarded defendants’ profits for trademark infringement based on the same sales of the same accused devices. To the extent that the Federal Circuit was saying that the reasonable royalty for the product should be deducted from profits before the award, this make sense. The award for patent infringement exceeded the defendant's profits, there were no profits left to award. Had plaintiff sought damages based on something other than the profits from the infringement, it might have been able to recover for the infringement of its trademark. However the Federal Circuits appears to be applying a broader preclusion: that when the claims arise out of the same set of operative facts there may be only one recovery.
COMMENT: What would be the result if the patent and the trademark were owned by two different parties?
CANON: A claim construction that gives meaning to all the terms of the claim is preferred over one that does not do so. Thus a construction that makes one of the claim terms illusory is not correct.

The Federal Circuit Reviews Obviousness, and its "Flexible" Suggestion Test

DyStar v. Patrick Co. (Fed. Cir. 2006) The Federal Circuit reversed the denial of JMOL that the claims were not invalid, finding the claims invalid for obviousness.
SIGNIFICANCE: The Federal Circuit comprehensively restated the obviousness standard in advance of the Supreme Court's decision in Teleflex, Inc. v. KSR Int'l Co., supporting its "suggestion test".
QUOTE: "Obviousness is a complicated subject requiring sophisticated analysis, and no single case lays out all facets of the legal test."
BRIEF: The Federal Circuit examined the obviousness of a method whose individual steps were all known. The Federal Circuit said the isse prseented was to determine "if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains." 35 U.S.C. § 103(a). The Federal Circuit had to address two questions: (1) whether a person of ordinary skill in the art would have been motivated to combine the prior art to achieve the claimed invention and (2)whether there would have been a reasonable expectation of success in doing so.
The Federal Circuit continued its analysis with the Graham factors: (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. In case where 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". This is where the suggestion test comes in to "prevent[s] statutorily proscribed hindsight reasoning when determining the obviousness of an invention."
The Federal Circuit explained that 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. The Federal Circuit said "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." The 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." The suggestion test is in actuality quite flexible and not only permits, but requires, consideration of common knowledge and common sense, and starts from the self-evident proposition that mankind, in particular, inventors, strive to improve that which already exists.

Copyright Registration is a Prerequisite to an Infringement Claim

TVI, Inc. v. Infosoft Technologies, Inc., 4:06cv00697JCH (E.D. Mo. 2006) Judge Hamilton dismissed Infosoft's counterclaim for copyright infringement under 17 USC 411(a) because the copyright had not been registered at the time of the counterclaim.

17 U.S.C. 411(a) provides that no action for infringement can be brought until "registration of the copyright claim has been made". Infosoft argued that the fact that it applied for registration was sufficient to confer jurisdiction. The Court reitered the conventional rules of claim construction:

• When interpreting statutory law, a fedearl court's objective is to give effect to the intent of Congress
• Analysis of a statute must begin with the plain language, and if it is unambiguous, that language is conclusive absent legislative intent to the contrary
• If the intent of Congress can be clearly discerned from the statute's language, the judicial inquiry must end
• Absent an express definition provided in the statute, words are given their ordinary, common meanings.
• When looking at a single statute, individual sections should be construed together
• A statute ought to be construed in a way that no clause, sentence, ro work shall be superflouos, void, or insignificant

The Court noted two approaches, the "Registration Approach" which requires that the copyright be registered, and the "Application Approach" which merely requires that an proper application have been filed. The Court found the Registration Approach to comport more with the language of the section, as well as other sections, which both contemplated examination as a prerequiste to registration, which undermines the interpretation that registration is complete upon filing. The Court also found that the primary support for the Application Approach came from policy arguments, and found that that approach had "significant flaws" including requiring a "topsy-turvy reading" of the Act, and providing no explanation why, if application and registration mean the same thing, Congress used two different words.

The Court dismissed the copyright counterclaims.