August 2015

Does the New Akamai Decision Breach the Logical Framework of Patent Infringement Law?

The Federal Circuit, sitting en banc and in a per curiam opinion, has held a party can be liable as a direct patent infringer under 35 U.S.C. § 271(a) even though it did not make, use, sell, or offer to sell every element of the claimed invention. Akamai Tech., Inc. v. Limelight Networks, Inc., No. 9-1372 (Fed. Cir. August 13, 2015). “Conditioning” a third party to practice a claim element is now apparently enough for direct infringement. One must wonder whether this latest twist in long-running litigation over U.S. Patent No. 6,108,703 will, as might seem to be the case at first blush, make life easier for patent plaintiffs. More fundamentally, one must wonder how a party can be a direct infringer if it does not practice – at least by “direction and control” of a third party – all of the elements of a patent claim. According to the Federal Circuit, direct infringement now encompasses such facts. The ’703 patent is directed to a content delivery network method that facilitates the logistics of storing and accessing data for web pages. Limelight practiced all of the claim elements save for steps of “tagging” and “serving” data. Because other parties practiced… Read More »Does the New Akamai Decision Breach the Logical Framework of Patent Infringement Law?

Emergency Call Analysis Patent Claims Invalid Under Alice

Patent claims directed to an “emergency call analysis system” were held patent ineligible, and a motion to dismiss for failure to claim patent-eligible subject matter under 35 U.S.C. § 101 granted, in Boar’s Head Corp. v. Directapps, Inc., No. 2:14-cv-01927-KJM-KJN (E.D. California, July 27, 2015). The court found that under the Mayo/Alice test the patent claimed an abstract idea without an inventive step that  limited the claim in a patent-eligible manner. U.S. Patent No. 8,447,263 describes a dashboard system which receives emergency calls, performs statistical analysis on data related to the calls (geographic location, type of call, etc.) and displays the results graphically. The court first considered and rejected plaintiff’s argument that dismissal was premature because claim construction had not yet occurred. According to the court, the only factual issue genuinely in dispute was whether a merely generic computer could perform the patent claims. However, the patent answered this question, stating that the “computer system may also be implemented as or incorporated into various devices, such as a personal computer or a mobile device . . . any kind of computer system or other apparatus adapted for carrying out the methods described herein is suited.” Next, the court applied the… Read More »Emergency Call Analysis Patent Claims Invalid Under Alice

Patent Claims to Use of Inertial Sensors Fail the Alice Test

The Court of Federal Claims recently held that patent claims for determining the orientation of a pilot in a fighter jet, although reciting hardware elements, were invalid as directed to a patent-ineligible abstract idea under 35 U.S.C. § 101. Thales Visionix, Inc. v. The United States, No. 14-513C (Ct. Cl. July 20, 2015). Accordingly, the court granted the defendant’s motion under FRCP 12(c). Plaintiff Thales Visionix, Inc. (“TVI”) sued the United States, alleging that use of helmet-mounted display systems in the F-35 Joint Strike Fighter infringed claims of U.S. Patent No. 6,474,159, directed to motion-tracking relative to a moving platform. The court applied the familiar two-step Alice test to the asserted claims. First, the court determined whether the claims were directed to an abstract idea. A representative claim included two inertial sensors, and an “element” adapted to receive signals from the sensors. The court held that even though the independent claims included “a system of generic inertial sensors and a receiving element,” the claims were “directed to mathematical equations for determining the relative position of a moving object to a moving reference frame.” Thus, the claims were directed to the abstract idea of “tracking two moving objects and incorporat[ing] laws… Read More »Patent Claims to Use of Inertial Sensors Fail the Alice Test

No Stay When Inter Partes Review Not Yet Instituted

Where the Patent Trial and Appeals Board (PTAB) had not yet ruled on a petition for Inter Partes Review (IPR), a U.S. District Court denied a defendant’s motion for a stay pending completion of the IPR. Seymour Levine v. The Boeing Co., No. 14-1991RSL (W.D. Wash. July 29, 2015). The court was swayed by the fact that the PTO had not yet decided whether to conduct an IPR proceeding concerning U.S. Patent No. RE39,618. The court relied on a familiar three-pronged test to determine whether to stay the proceeding. Specifically, “1) whether a stay will simplify the issues in question; 2) the stage of litigation, i.e., whether discovery is complete and whether a trial date has been set; and 3) whether a stay would unduly prejudice the non-moving party.” Here, because there was only slightly more than a 50% chance that a claim will be invalidated upon review, a stay may have “no salutary effects and would simply delay litigation.” That is, the court multiplied the .67 chance that an IPR would be instituted by a .79 chance that the IPR would favor the defendant. The court seems to have ignored the fact that, if the IPR was instated and… Read More »No Stay When Inter Partes Review Not Yet Instituted

Trade Secret Misappropriation Claim Dismissed Where Plaintiff Failed to Prove Damage

An element of a claim of trade secret misappropriation is that the theft has caused damage, a lesson reinforced by the defendant’s successful motion for summary judgment in 3PD, Inc. v. U.S. Transport Corp., Case No.: GJH-13-2438 (D. Md. July 9, 2015). Even if trade secrets were wrongly taken by the defendant, the plaintiff failed to demonstrate actual damages under the Maryland Uniform Trade Secret Act (“MUTSA”). The plaintiff, 3PD, Inc., is a logistical support company with a nationwide customer data base comprised largely of major consumer product retailers. Rose was a manager in charge of supervising and organizing all of 3PD’s centralized customer dispatching and routing for Lowe’s Home Centers. Rose gave 3PD 12 days’ notice of his resignation to take a position with the defendant, one of 3PD’s competitors. During that time, Rose forwarded “to his personal e-mail account confidential 3PD information that 3PD contends was trade secret.” That information included price and task sheets, budgets, forecasts, meeting notes, scheduling methods, and contact information. 3PD terminated Rose upon discovering his activities. Without analyzing whether the information that Rose downloaded to his personal e-mail account was included trade secrets, the court concluded that 3PD did not adequately demonstrate it… Read More »Trade Secret Misappropriation Claim Dismissed Where Plaintiff Failed to Prove Damage

Updated USPTO Patent-Eligibility Guidelines Are a Must-Read

The U.S. Patent and Trademark Office recently updated its patentable subject matter guidance.  Anyone involved in making filing decisions and/or preparing and prosecuting software or business methods patent applications would be well advised to consult the new documents.  I did not provide such a recommendation concerning the USPTO’s initial “Interim” post-Alice guidance, issued in December 2014, inasmuch as that guidance was not much  more than a regurgitation of the often inconsistent and irreconcilable case law that practitioners struggle with daily.  The updated guidance, however, provides some concrete ideas that may be put into practice in making claim amendments, and presenting arguments in Office Action responses and appeals. Sort of like a software application that is permanently lodged at the beta stage, the Patent Office continues to call its guidelines, promulgated in December 2014 and updated as of July 2015, “Interim.”  Whatever they are called, the present updates do more than simply summarize case law, providing examples of claims that the USPTO says would not be – and more importantly, would be – patent-eligible.  The July 2015 guidelines, as the USPTO explicitly states, are clearly responding to complaints from the patent bar that the Patent Office has not explained what subject… Read More »Updated USPTO Patent-Eligibility Guidelines Are a Must-Read

Denial of Dispositive Motions Undermined Argument for Exceptional Case

A recent case in which a court refused to find a case exceptional under 35 U.S.C. § 285, and denied a defendant’s motion for fees, demonstrates how Octane Fitness has not greatly shifted the ground in many patent cases. In Ushijima v. Samsung Electronics Co., Ltd., No. A-12-CV-318-LY (W.D. Tex. Jul. 30, 2015), the denial of the defendant’s dispositive motions, and the concomitant findings that issues of material fact remained, undermined the defendant’s argument that a plaintiff’s refusal to abandon its suit after certain findings rendered the case exceptional. Under Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749 (2014), an “exceptional case” under 35 U.S.C. § 285, in which “the court . . . may award reasonable attorney fees to the prevailing party,” is one “that stands out from others with respect to the substantive strength of a party’s litigating position . . . or the unreasonable manner in which the case was litigated.” Octane Fitness, LLC., 134 S. Ct. at 1756. Samsung, the defendant, argued that the present case was exceptional because Ushijima, the plaintiff, “brought suit against Samsung EE Products even though he [Ushijima] disclaimed EE type cores . . . and no… Read More »Denial of Dispositive Motions Undermined Argument for Exceptional Case

Internal Website Can Be a Trade Secret

Allegations that a customer database and an inter-office call center website were trade secrets survived a Rule 12(b)(6) motion to dismiss in Capital Meats, Inc. v. The Meat Shoppe, LLC, Civil No. JFM-15-212 (D. Md. July 9, 2015). The court ruled that the plaintiff had stated a plausible claim under the Maryland Uniform Trade Secrets Act (“MUTSA”), thus providing a useful illustration of how even information widely shared within a company can be protected as a trade secret. The plaintiff, Capital Meats, Inc. (“CMI”), maintains a customer data base and call center website, both of which are used to track inventory, sales, customer payment processing, and outstanding balances owed by the retailers purchasing CMI’s frozen meat. CMI’s auditor resigned and, with as dozens of retail dealers, formed The Meat Shoppe, a door-to-door seller of frozen meat. CMI’s complaint alleged that the defendants “directly obtained the information contained in the Database and Call Center Website through ‘improper means,’” and then distributed “that information to former Retail Dealers who joined The Meat Shoppe.” CMI further alleged that it lost significant business due to the defendants using the information to their competitive advantage. The defendants moved to dismiss the count of violating the… Read More »Internal Website Can Be a Trade Secret