Patent Law

Using your common sense and whatever patent knowledge you have, should this be patentable? Why?

An apparatus for use as a toy by an animal, for example a dog, to either fetch carry or chew includes a main section with at least one protrusion extending there from that resembles a branch in appearance.

It Got a Patent - US Patent No. 6,360,693 -Patent Law Overview

Patentable subject matter– Anything man made

Useful Novel Non-obvious Adequately described

Pass around patent samples

Buttocks support deviceUS Patent No. 6,360,375 Issued March 26, 2002

BeerbrellaUS Patent No. 6,637,447 Issued October 28, 2003

Useful Patents?

6,681,419

Patent Law Overview Continued

Grant of Exclusive Monopoly. Exclusive monopoly for a limited period of time – 20 years

Reveal Secret. Must reveal to the public the secret Federal law – not state Court of Limited Jurisdiction. US Court of Appeals

for the Federal Circuit (rather than patent cases spread among all federal circuit courts)

Conflict Between Antitrust and Patent Law.– The Congress shall have the 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 - US Constitution

– Soon passed The Patent Act

Deep Secrets Revealed!

What is it? Interestingly, it is an improvement on three previous patents on roughtly the same idea. U.S.

Pat. Nos. 6,023,792; 6,081,941; and 6,125,480.

This patent extends the umbrella to add a leash to the dog. Previous patents for pet umbrella’s did not include the leash U.S. Pat. Nos. 5,546,970 and 5,918,611

Subset of Utility Patents - Business Process Patent State Street Bank Case

Oral Presentation

Grading Rubric

State Street Bank Case

Business process patent Both State Street and Signature Work as custodians for mutual funds Mutual funds pooled into larger groups to save administrative costs and enable

daily valuations Complex process to do so – getting values and then distributing those values

back to the spokes Relies heavily on math formulas as well as process State Street sought license from Signature and sued for declaratory judgment

of patent invalidity when talks broke down

Mutual Fund Valuation HubPooled assets

Mutual Fund

Mutual Fund

Mutual Fund

Mutual Fund

Mutual Fund

Mutual FundMutual Fund

Mutual Fund

Mutual Fund

State Street Bank – Legal Issues

Can you patent a business process?– Yes – since this case if it results in “a useful, concrete,

and tangible result” Can you patent a math algorithm?

– Sort of – no if it’s pure math, but yes if it’s a “process employing a law of nature, natural phenomenon, or abstract idea”… that produces a “useful, concrete and tangible result”

– Why not allow patents on math itself?

Group Presentation: Groups 1 and 2

– Diamond v., 447 U.S. 303 (1980))

Chakrabarty

Group Presentation: Groups 1 and 2

– Diamond v. Chakrabarty, 447 U.S. 303 (1980))

– Chakrabarty created a new bacterium

– “Judged in this light, respondent’s micro-organism plainly qualifies as patentable subject matter. His claim is not a hitherto unknown natural phenomenon, but to a non-naturally occurring manufacture or composition of matter – a product of human ingenuity “giving a distinctive name, character [and] use.” … [T]he patentee has produced a new bacterium with markedly different characteristics from any found in nature and one having the potential for significant utility. His discovery is not nature’s handiwork, but his own; accordingly it is patentable subject matter under §101.”

Key Sections of The Patent Act

§ 101.“Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title”

§ 102. If the invention lacks novelty, i.e. public is aware, then no patent shall issue.

§ 103. Non-Obvious

Change in Direction

• KSR v. Teleflex. 2007 US Supreme Court Case Struck down patent on a gas pedal as nothing more than “obvious” combination of existing technologies.

Bilski v. Doll – - discussed later under business process patents

Non-Obvious

Standard. Would have been obvious at the time of the invention was made to a person having ordinary skill in the art to which said subject matter prevails.

Example. – Inventor invents A + B. – A is known art – B is know art– Upon looking at A and then looking at B, would someone of

skill in the art consider A + B to be already know? If yes, obvious. If no, then non-obvious

Subjective Standard.

1/19/13 St. Cloud Times

Non-Obvious?

Towel for Hair Styling

Non-Obvious Patent?

Copied from actual patent

Types of Patents – Utility

Utility. Useful inventions– process– machines– manufactured goods– composition of matter– improvements (a better mousetrap)– 20 years

More on Business Process Patents

• Patent for Janitorial Services • Show patent • Illustrations

Change in Direction for Business Process Patents?

Bilski v. Doll –on business method of hedging. Ruled June 28, 2010• Sarcastic Comments About Business Process patents.

• Justice Roberts comment: “I buy low and sell high – that’s my patent for maximizing wealth.” • speed dating – Sonia Sotomayor • Great method to teach antitrust – Breyer

• IBM Comment – it is the leader in business process patents – it thinks they should be reduced.

• New Standard. Business process patent ok if – if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing (could be okay otherwise as well). State Street Bank standard of “a useful, concrete, and tangible result” is no longer adequate.

Patent by Jesse Shaw, Father of Classmate Piper Shaw

Inventor

Assignee

Patent #Date

Types of Patents - Design Patents Design Covered

– Ornamental features Exclusions

– Novel – Non-obvious

Years. 14 years Weak – protects what is drawn

– Marketing Value “patent pending” “patent issued”

– Multiple Design Patents – help protect– Design Patent and Utility Patent on Same Invention

Two: Aug 28, 2007 Issued Design Patents, Ideas?

First design patent

False sideburn sunglassesDesign Patent # 376,811

Start here Thursday – piper’s dad’s patent – talk about it

End-of-Chapter Question 2– Design Patent on Ink Cartridge

Patent Infringement Suit. Seiko Epson Corp sued Nu-Kote International for design patent infringement

Court Held No Infringement. District court held design patent not valid– The cartridge is not visible after installation and during use

– the design was “not a matter of concern to consumers.” and

– The design is not aesthetically pleasing What are your thoughts? Should Seiko Epson be

entitled to a design patent on an ugly design that cannot be seen?

End of Chapter – Question 4– Design Patent on Cigarette Package

New Feature – Package opens from bottom

Quote: “I was motivated… to design a new cigarette package when I happen to see… workers pull out cigarettes from the packages holding their filter tip top with dirty fingers during work to smoke them. Some even used their teeth to pull them out so as not to contaminate the filter-tip end with dirty fingers, and some others tore open the bottom part of the package to take out cigarettes from the bottom.”

In re: Uie S. Chung 2000 US App Lexis 24916 (Fed. Cir. Oct 2000)

Note: this is not the same patent as this case but close

Plant Patent Novel, Non-obvious and Distinct Living Organism Duplicated Through Asexual Reproduction. A living plant organism

which expresses a set of characteristics determined by its single, genetic makeup or genotype, which can be duplicated through asexual reproduction, but which can not otherwise be "made" or "manufactured."

Hybrids and Natural Plants. Sports, mutants, hybrids, and transformed plants are comprehended; sports or mutants may be spontaneous or induced. Hybrids may be natural, from a planned breeding program, or somatic in source. While natural plant mutants might have naturally occurred, they must have been discovered in a cultivated area.

– Algae and macro fungi are regarded as plants, but bacteria are not.– That the plant is not a plant which is excluded by statute, where the part of the plant used for asexual reproduction is not

a tuber food part, as with potato or Jerusalem artichoke. – That the person or persons filing the application are those who actually invented the claimed plant; i.e., discovered or

developed and identified or isolated the plant, and asexually reproduced the plant. – That the plant has not been sold or released in the United States of America more than one year prior to the date of the

application. – That the plant has not been enabled to the public, i.e., by description in a printed publication in this country more than

one year before the application for patent with an offer to sale; or by release or sale of the plant more than one year prior to application for patent.

– That the plant be shown to differ from known, related plants by at least one distinguishing characteristic, which is more than a difference caused by growing conditions or fertility levels, etc.

– The invention would not have been obvious to one skilled in the art at the time of invention by applicant.

Group Presentation: Groups 1 and 2

– Diamond v., 447 U.S. 303 (1980))

Chakrabarty

Group Presentation: Groups 1 and 2

– Diamond v. Chakrabarty, 447 U.S. 303 (1980))

– Chakrabarty created a new bacterium

– “Judged in this light, respondent’s micro-organism plainly qualifies as patentable subject matter. His claim is not a hitherto unknown natural phenomenon, but to a non-naturally occurring manufacture or composition of matter – a product of human ingenuity “giving a distinctive name, character [and] use.” … [T]he patentee has produced a new bacterium with markedly different characteristics from any found in nature and one having the potential for significant utility. His discovery is not nature’s handiwork, but his own; accordingly it is patentable subject matter under §101.”

Patent Statistics

Patent Statistics from US Patent Office

Type U.S. % GrantedUtility 503,582 46%* (77,501 to

US, 80,271 Foreign – 50%)

Design 30,347 70%*

Plant 1,139 72%*

http://www.uspto.gov/web/offices/ac/ido/oeip/taf/reports.htm

*The percentage of patents granted is approximate as I am simply dividing total patents issued in a year by total applications submitted. Patents applications generally take more than a year so this is not an accurate measure but at least provides rough guidance.

Patent timelines

Large patent infringement awards

2011 Patent Reform –America Invents Act

1. First to File. For patents filed after March 16, 2013.2. Patent Office to Keep Fees Charged. This will help get the patent office funding to deal

with backlog of cases (sort of – funds put in “fund” and released by Congress).3. Allow Post Grant Dispute Process. The measure allows inventors or companies to

contest the validity of a patent for nine months after it issues.4. Allows Putting Patent Number on Product After Patent Expires. Except the government

can sue or a competitor if actually hurt by markings. 5. Expands the Definition of Prior Art. Actions and prior art that bar patentability will include

public use, sales, publications and other disclosures available to the public anywhere in the world as of the date of filing, other than publications by the inventor within one year of filing.

6. Prior User Rights Defense. If an individual/entity begins using an invention more than a year before a subsequent inventor files for a patent on the same invention, the original user will have the right to continue use. This rule used to only apply to business process patents.

7. Cheaper Fees for “Mirco-Entity.” Previous calendar year gross income of less than three times the national median household income and has filed no more than 4 patents.

8. Business Method Patent Transitional Program. Creates an Administrative program for review of business-method patents. “Transitional Program for Covered Business Method Patents.” No nine month review limitation.

9. Bans Tax-Strategy Patents.

Expired patent lawsuits – person suing gets to keep ½ with the rest going to the federal government – well no more. $500 per offense.

Total Patent Documents Published - 2015

Patents Published by Type Through 2015

Utility

Design

Application

Top 20 Patent Holders – Issued 2015

Samsung

IBM IntelToshiba

Canon GoogleApple

GEMicrosoft

ToyotaSony Ford

Patent Issues

First to Invent/First to File. Application Process

– Prior art search– Cost – Fully disclose invention as “price” of getting patent– Must file within 1 year of first commercial use

Notice – “Pat.”– “patented” – Patent number

Idea made public after 18 months unless withdrawn (U.S. used to not make public until granted – recently change to match more of the world)

Patent Searches Made Easy • US Patent Office Web Site

http://www.uspto.gov/patft/index.html

• Free Patent Search Web Site http://www.freepatentsonline.com/search.html

bigw 862221College beer game

Patent Invalidation/Infringement Directly infringe Induce another to infringe

– Actual infringement by a third-party is a necessary element– Sales literature, etc. to get another to infringe

Contributory infringe– Sell a key element of patented product, that has no use except as a

component of a patented product– Action contributes to another’s direct infringement

Manufactures or sells components to be assembled abroad Imports, sells or offers to sell or uses a product made abroad

through patented processes Note: retailers are potentially liable but not liable if an adequate

remedy against the primary manufacturer Attorneys Fees. The winning party to recover legal fees from the

losing party in exceptional cases like intentional infringement. Treble Damages. The court may award treble damages if the

defendant willfully infringed or acted in bad faith.

updateProctor and Gamble sold Folders (to Smucker’s) and settled

Start here tuesday

Recent Patent Case – Heinz Ketchup

Recent Patent Case – Apple v. Samsung

One Key Feature for Discussion:• Pinch to zoom• Bounce back scrolling• Rounded corners – design

patent• Icon style and layout• Should you be able to patent

how people interact with a machine?

Inducement to Infringe

Inducement. Assist a person to infringe

Contributory. Sells a material component.

Snuba International v. Dolphin World, Inc.

Ebay v. MercExchangeSupreme Court Case - 2006

From ebay

Patent Damages

Injunction – not using the patent and license it to others1. Based on four factors when an injunction usually issues

NTP v. RIM• Patent for push email

technology• 3 million users shut down?

Injunction Monetary

– Lost profits– Reasonable royalty– Attorney’s fees (sometimes)– Treble damages – if willful or

reckless Personal Liability. Corporate

officers and managers can be held personally liable.

Famous Music Corp v Bay State Harness Horse Racing & Breeding Assoc, 423 f. Supp. 341 (1977)

Similar Case: Amazon patented “single action” or one-click purchasing over the internet. BN started “express lane” doing basically the same thing.

Patent Damages Continued

Defenses to Patent Infringement

Invention not novel, non-obvious and useful Not novel, non-obvious and ornamental for a design patent Patent misuse.

– Antitrust – more than patent was meant to do Inequitable conduct. Experimental use defense Not a defense – patent not used (ok to sit on invention)

Question 1, p. 421. LG Electronics licenses use its patent to Intel for Intel to make computer chips. Quanta Computer bought Intel chip and LG wants Quanta to pay patent royalty. Quanta argues LG cannot collect patent fees twice – what else would you use an Intel computer chip for?

Patent Infringement – CHINA

Copy of iphone –”minione”

• Easy ways to clone: Ghost shift Shadow factory Read patents – hire “20 to 40 engineers to reverse engineer”

• Often not the same Cheaper materials crash tests on copied cars performed much worse than original

• Chinese government slow to enforce. May 29, 2007, Zheng Xiaoyu sentenced to death for accepting bribes. The bribes were given in part to secure approval of a counterfeit drug antibiotic that later killed 10 people.

CHERY CHEVY

Source: Popular Science, Sept. 2007

Sony PlayStation Hit With $90 Million Judgment. Japanese Company, Sony, hit with $90.7 million judgment to pay patent holder of tactile feedback feature. Sony used the feature on its PlayStation consoles – Dual Shock controllers.

Ownership of Patent Ownership of patent – employee versus employer Shop rights Invention assignment agreements

• IBM, Sony, Pitney Bowes, and Nokia announce patent sharing plan. Will not assert patents against anyone who is “using them in an environmentally friendly way.”

• IBM is donating….”one for recyclable protective-packaging material for delicate electronic parts. Unlike commonly used foam peanuts, the material can be recycled in the same waste stream as the cardboard box that contains it.”

In 2014, Tesla releases its patents

Cost of a Patent Filing Timing. Generally all fees are not due up front because Patent Office

backlogged – generally sits first 18 months. This will allow some budgeting and planning.

Filing fee - $165 for small inventor ($330 for a large inventor) plus a search fee of $270 ($540) and an Examination fee of $110 ($220). Total of $545.*

Issue Fee – an additional $755 ($1,510) Multiple Filings. Often the patent office will award some claims and

not others – you may decide to issue those patents, thus the issue fee, and continue to pursue the other claims – thus more filing fees.

Drawing Fee. You need drawings, generally $100 plus per drawing. Attorney Fees. National average $250-275 per hour. Attorney will

generally do a patent search for around $300. Next step is a patentability opinion which would cost around $1,000 on the low end.

More. Plus more fees for a variety of items. The fees are actually quite a bit more complicated as this slide sticks to the basics.

97% of Patents Lose Money

The U.S. Patent & Trademark Office estimates that only 3% of the patents issued by the Patent Office actually

make more money than it cost to get the patent .Source: PatentCafe.com 2007

*2009 Numbers

Filing Cost for PatentsPre-2011 Law Small Entity Fees

Post 2011Mirco Entity Cost

Average Cost of Patent Process

Type of Invention Examples Cost

Simple Coat hanger, diapers, ice cube try $4,00-$6,000

Minimal Complexity Board game, umbrella, toothbrush $6,500-$9,000

Moderately Complex Power hand tool, lawn mower, camera, cell phone

$9,000-$12,000

Intermediate Complex Video game, ride on lawn mower, solar concentrator

$12,000 to $16.000

Relatively Complex Shock absorbing prosthetic device, internet implemented business method with computer system

$16,000-$25,000

Highly Complex MRI scanner, telecommunication networking system

$25,000++

Source: Quinn, The Cost of Obtaining a Patent, IPWatchdog.com (July 26, 2007)

Worldwide Patent Protection– Each country has its own laws– Paris Convention – 160 countries

National treatment to foreign patents– Patent Cooperation Treaty

108 members - Cheaper than dealing with each country individually Novartis Article

– Facts. Novartis gave up patent fight in India for its drug Gleevec– Issue. India is not as supportive of patent laws

“Brazil, Russia, India, China and Turkey could account for half Novartis’s revenue growth in the next five years "Big pharma in rich countries is slowing”

Poor countries cannot afford the medicine – thus relying on growing economies

Newly industrializing countries are also more interested in protecting patents as their companies begin developing unique drugs and solutions

– Law. India now allows patents on drugs developed after 1995 Comment. Inventors, at least in the pharmaceutical

industry, need to be conscious of foreign patent rules

International Patent Issues

Q: Is it worth it to get a patent in China?A: The big risk – if another company gets a patent

International Issues Continued New India Law.

– 1970 law allowed Indians to reverse engineer drugs to promote better publish health (e.g. aids drugs for $200/year v. $10,000/year in U.S. – ½ of aids drugs come from India)

– Now must wait 3 years and pay reasonable royalty to patent holder (4%? Is that reasonable? 45% - what German company wants?)

Difference between U.S. law and other countries (U.S. used to patent for 17 years – now 20 to “harmonize” with Europe.

U.S. World (primarily Europe)

Filing First to Invent until 2013 First to File

Worked No requirement Yes, some countries

Business Methods Patentable , 2011 law restricted this somewhat.

No – EuropeYes - Asia

Grace Period Yes, can reveal secret and still file – 1 year

No, once secret revealed no longer patentable

Challenge 2011 Law made consistent with world.

Opposition challenge within 9 months

Secret Public after 18 months with some exceptions

No, published after 18 months