Tuesday, October 28, 2014

Don't Assume That Your U.S. Patent Is Valid

My blog post yesterday reported on the high invalidity patent rates of several developed countries. And last Friday, Judge Raymond T. Chen of the Federal Circuit, the appellate court charged with reviewing appeals of patent cases, raised a warning that patent owners should be cautious in assuming that their patent grant has merit.

Judge Chen told the annual meeting in D.C. of the American Intellectual Property Law Association on October 24th that the large grant of invalidity petitions by the Patent Trial and Appeal Board should produce a chill in many patent owners. Stated Judge Chen,
It is quite a commentary it seems to me that in a short period of time, the patent board has found it likely that at least some claims in almost 1,000 patents are unpatentable,
Those grants are of course non-final decisions, but the decision to grant the petition is not simply a small hurdle. It is a significant event that should get the attention of any patent owner.

Monday, October 27, 2014

Are Patents Worth The Paper They Are Printed On?

At the IP Scholars Conference held at UC Berkeley this past August 8, 2014, Joachim Henkel and Hans Zischka of the Technical University of Munich presented their paper on invalidation rates for issued patents. Their presentation is here. Henkel/Zischka suggest that if all patents issued by Germany went through invalidation proceedings, then about 75% of issued patents would be ruled either partially or fully invalid. As presented in their report, invalidation rates for other countries are:

  • Japan:                   73%     
  • United States:       60%
  • Australia               53%
  • United Kingdom:  50%
  • France:                 27%

This report should not provide much confidence to a patentee over the perceived strength of its patent.

Friday, October 24, 2014

Where Have The Trademark Cases Gone?

A review of the annual case filing statistics published by the Office of Federal Courts reveals that new trademark infringement filings in federal courts have been dropping while new patent and copyright filings have been increasing.


New patent case filings have more than doubled between 2009 and 2013, and new copyright filings have almost doubled since 2010. But trademark filings in federal courts reached a plateau in 2010 and have been decreasing since. Indeed, new copyright filings overtook new trademark filings in 2013 for the first time.

In a few months, the Office of Federal Courts will publish its new statistics for the period through September 30, 2014, and it will be interesting to see if these trends continue.

For the year ending September 30, 2013, the report identifies the following top five federal districts for new filings of copyright, patent and trademark claims:

A. New Copyright Cases:
  1. California Central:     541
  2. Illinois Northern:        321
  3. New York Southern:  229 
  4. Colorado:                   223
  5. Michigan Eastern:     158
B. New Patent Cases:
  1. Delaware:               1,492
  2. Texas Eastern:        1,386
  3. California Central:      505
  4. Virginia Eastern:        223
  5. Illinois Northern:        217

C. New Trademark Cases:
  1. California Central:      507
  2. New York Southern:  217
  3. Florida Southern:       210
  4. Illinois Northern:         209
  5. New Jersey:               126
The California Central federal district appears to be the most balanced in terms of the close number of new patent, copyright and trademark filings. Delaware and the Eastern District of Texas are the most out of balance, with their IP focus almost completely on patent cases.

Thursday, October 23, 2014

The Separate Accrual Rule in Copyright

In its decision today, the Seventh Circuit adopts a statue of limitations rule for copyright claims that many other courts have applied. The limitations test for copyright claims is not whether a lawsuit is filed by plaintiff within three years of discovery of an act of infringement. Rather, in copyright, a court looks to whether any claimed acts of infringement occurred within three years of filing the complaint. 

Today's opinion in Chicago Building Design, PC v. Mongolian House, Inc. deals with a pretty typical infringement claim relating to architectural plans. The plaintiff claims to have created architectural plans that the defendant copied and distributed as its own. Plaintiff had an inkling in 2008 that its plans were being infringed by defendant. Plaintiff saw what appeared to be a copy of its plans laying about at Chicago building permit offices, labeled with another architect's name. Plaintiff requested to see a copy of the suspect plans, but Chicago refused to provide a copy, claiming that the plans were exempt from disclosure. Plaintiff eventually filed its copyright infringement claim in 2012.

The statute of limitations for a copyright claim is three years. The district judge held that plaintiff was on inquiry notice in 2008, and that the statute of limitations began to run at that time. As such, the district judge ruled that the lawsuit was filed outside the three year window. The case was dismissed. But the Seventh Circuit disagreed, pointing out that the limitation analysis in copyright looks to whether acts of infringement occurred within three years of filing the complaint. The fact that an act of infringement occurred more than three years prior to commencement of the action is not the test. This is so because each act of infringement starts a new limitations period. And because plaintiff alleged that some acts of infringement occurred within three years of filing the complaint, the case should not have been dismissed.

The Seventh Circuit also determined that it is inappropriate to view a series of infringing acts as one, grand continuing infringement originating from a common, initial source. The fact that the initial act occurred outside of the three year look-back period does not prevent a copyright claim against related acts of infringement that occur within the three year period.

Wednesday, October 22, 2014

Revised Definition of Copyright Claimant: Can't Claim It If You Don't Own (All Of) It

The Copyright Office is amending its rules relating to who can apply for a copyright registration. The current rule permits certain classes of claimants, defined as:
  1. The author of the work,
  2. The person or entity that has obtained ownership of all rights to the work belonging to the author, and
  3. The person or entity that obtained from the author the contractual right to claim legal title to the copyright in the application.
The Copyright Office has published its notice of rulemaking to eliminate the third element set out above. That is, once the proposed amendment to the definition of claimant becomes effective, only the author, or a person or entity that has obtained all of the rights to the work from the author, can be a copyright claimant in order to apply to register a copyright. 

So, if an applicant seeks to obtain a copyright registration, the applicant must own all rights of authorship and not merely the contractual right to claim title to the copyright in the application. Excluded from the definition of permitted claimant will be assignees or devisees from the author or copyright owner who do not receive the entirety of the copyright interest. For example, excluded from the revised definition of claimant is a lender that takes a conditional security in software code under development containing the permitted right to apply for copyright registration. To become a successful claimant, the entirety of the copyright rights must transfer to the assignee and not merely the right to own the registration.

A person or entity that has the contractual right to apply for a copyright registration, or the right to own title to an unregistered copyrighted work, will no longer be able to apply for copyright registration in the work. In order to assure that an assignee has the right to apply for registration of copyright in an unregistered work, drafting appropriate language in a transfer document becomes key.

Tuesday, October 21, 2014

Digital Course Packets At College Can be Infringing

The Eleventh Circuit spent over a hundred pages explaining why digital course packets, prepared by college professors for downloading by students, may infringe the copyright in the copied material. The opinion is here. Several academic publishers sued Georgia State for failing to obtain consent and pay license fees when professors copied portions of copyrighted material for downloading by students. These digital course packets supplanted traditional paper course packets, for which GSU did obtain consent and pay a license. The appellate court spent considerable effort setting out the law of fair use and the interplay of fair use principles. Indeed, the opinion can be used as a copyright fair use treatise.

The concurring opinion summed it up best, however, by explaining that in a fair use analysis, this "case reveals the critical need to see the 'big picture' when attempting to determine what constitutes fair use of copyright work. * * * analyzing fair use, and after applying traditional common law principles to the use at issue here, this is rather a simple case."

This case does not involve an isolated event of a professor copying a single copyrighted work, or a one-time use of copyrighted material. Rather, the case involves a university-wide practice of using digital course packs, for which the university refused to pay a license, as a substitute for paper course packs, for which the university did pay a license. "This was done for the vast majority of courses offered at GSU and, as will be seen, it was done primarily to save money."

The majority opinion, in excess of 100 pages, analyses the nuances of copyright fair use in considerable detail as applied to academic use of course packs containing copies of copyrighted material. But as pointed out by the concurring judge, stepping back to take in the big picture can produce a much simpler, more direct, and more accurate result.

Trademark Protection for Food? It Doesn't Pass The Smell Test!

The federal court in Houston ruled yesterday that the flavors of Italian cooking, and the arrangement of Italian food on a plate, cannot be protected under trademark law. The opinion is here. The plaintiff, New York Pizzeria, Inc., argued that the flavors created by its pasta and pizza are protectable trademarks. It also argued that the plating of its foods -- that is, the appearance of its baked ziti, eggplant parmesan and chicken parmesan -- are protectable trade dress, But the court determined that food flavor is a functional element of food and, therefore, unprotectable.

"But the other main attribute of food is its flavor, especially restaurant food for which customers are paying a premium beyond what it would take to simply satisfy their basic hunger needs. The flavor of food undoubtedly affects its quality, and is therefore a functional element of the product."

The court also determined that while it is theoretically possible for the arrangement of food on a plate to be protectable as trade dress, the plaintiff's burden is very high. Only if plating is inherently distinctive or has acquired secondary meaning -- when plating serves no functional purpose -- can there be a potential infringement claim, but only if there is a likelihood of consumer confusion. The court denoted this plating claim as representing a "very high standard."

Wednesday, June 13, 2012

2012 Millennium Technology Prize

Linus Torvalds
The Technology Academy of Finland has awarded its 2012 Millennium Technology Prize to co-laureates Linus Torvalds of Oregon and Shinya Yamanaka of Japan. Many consider the Millennium Technology Prize to be on a par with the Nobel prize, but focusing on the development of new technology. Torvalds won a share of this year's prize in recognition of his development of the Linux kernel, the core of the open source software movement. Dr. Yamanaka was awarded the prize for his discoveries in stem cell development.

Quoting from the Finish Academy's announcement regarding Torvald's accomplishment:
One of the most important elements of the system, which he still writes code for from his Oregon home, as far as its creator is concerned, is that it should be open source software, publicly licensed for anyone to use. “I think open source is so important, it is basically taking the scientific approach of building on top of the openly published work of others, and applying it to software. And software is too important in the modern world not to be developed that way.”
Congratulations to both!
Shinya Yamanaka