Ejusdem Generis Goes to War in Reservist Pay Dispute

by Dennis Crouch

Although not a patent case, Feliciano v. Department of Transportation merits attention as one of only two Federal Circuit cases granted certiorari for the October 2024 Supreme Court term, alongside the veterans benefits case of Bufkin v. McDonough.

In Feliciano, the Supreme Court will consider whether federal civilian employees who are called to active military duty are entitled to differential pay even if their service is not directly connected to a declared national emergency. The case stems from the Federal Circuit’s interpretation of the differential pay statute, 5 U.S.C. § 5538, which requires federal agencies to provide supplemental pay to federal employees called to active duty when their military salary is less than their civilian salary.

The statute here provides a list of situations where the pay differential is required, including when federal employees are called to active duty under “a provision of law referred to in section 101(a)(13)(B) of title 10.” Section 101(a)(13)(B) lists several specific provisions and also includes a catchall when called to duty under “any other provision of law during a war or during a national emergency declared by the President or Congress.”

In the case, the petitioner Feliciano was called to service under the voluntary activation authority of 10 U.S.C.

Continue reading Ejusdem Generis Goes to War in Reservist Pay Dispute at Patently-O.

Alice Backs Anna: Federal Circuit Finds Miller Mendel’s Background Check Patent Abstract

Alice Backs Anna: Federal Circuit Finds Miller Mendel’s Background Check Patent Abstract

By Dennis Crouch

In Miller Mendel, Inc. v. City of Anna, Texas, No. 2022-1753 (Fed. Cir. July 18, 2024), the Federal Circuit affirmed a district court’s judgment on the pleadings that the asserted claims of Miller Mendel’s U.S. Patent No. 10,043,188 (‘188 patent) are ineligible for patent protection under 35 U.S.C. § 101. The court also affirmed the denial of the defendant’s motion for attorneys’ fees under 35 U.S.C. § 285.

The ‘188 patent is directed to “a web based software system for managing the process of performing pre-employment background investigations.” Representative claim 1 recites a “method for a computing device with a processor and a system memory to assist an investigator in conducting a background investigation of an applicant for a position within a first organization.” The claim goes on to recite several steps the system performs, including:

– receiving data identifying the applicant, position, organization, and investigator;
– storing a new applicant entry associated with the data;
– transmitting an applicant hyperlink to the applicant’s email to view documents;
– receiving an applicant response with reference data about a reference source;
– determining a reference class and selecting documents based on the reference class;
– transmitting a reference hyperlink to the reference’s email to view documents;
– receiving and storing a reference response associated with the applicant entry; and
– generating a suggested reference list of law enforcement agencies based on the applicant’s address.

Continue reading Alice Backs Anna: Federal Circuit Finds Miller Mendel’s Background Check Patent Abstract at Patently-O.

Alice Backs Anna: Federal Circuit Finds Miller Mendel’s Background Check Patent Abstract

Alice Backs Anna: Federal Circuit Finds Miller Mendel’s Background Check Patent Abstract

By Dennis Crouch

In Miller Mendel, Inc. v. City of Anna, Texas, No. 2022-1753 (Fed. Cir. July 18, 2024), the Federal Circuit affirmed a district court’s judgment on the pleadings that the asserted claims of Miller Mendel’s U.S. Patent No. 10,043,188 (‘188 patent) are ineligible for patent protection under 35 U.S.C. § 101. The court also affirmed the denial of the defendant’s motion for attorneys’ fees under 35 U.S.C. § 285.

The ‘188 patent is directed to “a web based software system for managing the process of performing pre-employment background investigations.” Representative claim 1 recites a “method for a computing device with a processor and a system memory to assist an investigator in conducting a background investigation of an applicant for a position within a first organization.” The claim goes on to recite several steps the system performs, including:

– receiving data identifying the applicant, position, organization, and investigator;
– storing a new applicant entry associated with the data;
– transmitting an applicant hyperlink to the applicant’s email to view documents;
– receiving an applicant response with reference data about a reference source;
– determining a reference class and selecting documents based on the reference class;
– transmitting a reference hyperlink to the reference’s email to view documents;
– receiving and storing a reference response associated with the applicant entry; and
– generating a suggested reference list of law enforcement agencies based on the applicant’s address.

Continue reading Alice Backs Anna: Federal Circuit Finds Miller Mendel’s Background Check Patent Abstract at Patently-O.

Expired Patent, Exploding Sanctions: A Costly Litigation Lesson for VDPP and its Attorney

Expired Patent, Exploding Sanctions: A Costly Litigation Lesson for VDPP and its Attorney

In a recent decision out of the Southern District of Texas, Judge Lee Rosenthal found the patent infringement case brought by VDPP against Volkswagen to qualify for sanctions under the Patent Act 35 U.S.C. § 285.  The court also relied upon 28 U.S.C. § 1927 and its inherent powers to directly sanction VDPP’s attorney William P. Ramey (Ramey LLP). VDPP, LLC v. Volkswagen Group of America, Inc., No. H-23-2961 (S.D. Tex. July 11, 2024).

  • VDPP Sanctions Memo
  • VDPP Dismissal Memo

VDPP’s US Patent No. 9,426,452 claims a system for presenting video content to a viewer wearing electrically controlled spectacles. The system involves reshaping portions of a video stream frame, stitching together frames from different streams, and blending the modified frames with a bridge frame. The spectacles worn by the viewer have independently controlled left and right lenses that can be switched between light and dark states, allowing the video content to be displayed to the viewer in a particular manner, such as by placing both lenses in a dark state while viewing the video.  Although the patent appears to be focused on spectacles, VS’s the alleged infringing apparatus is the Surround View system in the dashboard camera.

Continue reading Expired Patent, Exploding Sanctions: A Costly Litigation Lesson for VDPP and its Attorney at Patently-O.

USPTO Issues 2024 Guidance on Patent Eligibility for AI Inventions

USPTO Issues 2024 Guidance on Patent Eligibility for AI Inventions

by Dennis Crouch

Earlier this week I was reviewing some of the USPTO’s eligibility examples, noting that they were all quite old.  As if on cue, the Office has released a new set of updated guidelines – focusing on Artificial Intelligence related inventions and including three new examples.  In Bilski, the Supreme Court explained that the best way to understand whether a particular claimed invention is directed to an “abstract idea” is to look back on old examples for guidance.  The USPTO has found that a good way to administer this approach is to provide examples of situations that pass or fail the test.  Here, they introduce three new examples 47, 48, and 49.  And, while the Alice/Mayo test for analyzing subject matter eligibility has not changed, the new guidance is helpful as AI technology rapidly develops.   The USPTO continues to be open to issuing patents on AI inventions, including the use of AI. However, there must be a technical solution to a technical problem.

Although the guidance is effective July 17, 2024, the USPTO is open to comments via the regulations.gov portal.  The agency has provided two updated flow charts for its analysis that are included below.

Continue reading USPTO Issues 2024 Guidance on Patent Eligibility for AI Inventions at Patently-O.

The Phantom Menace: Federal Circuit Upholds Judge Connolly’s Investigative Powers Evan After Dismissal

by Dennis Crouch

In Backertop Licensing LLC v. Canary Connect, Inc., the Federal Circuit addressed the scope of a district court’s inherent authority to investigate potential litigation misconduct. Chief Judge Connolly of the District of Delaware had initiated an inquiry into dozens of patent infringement cases filed by plaintiff LLCs associated with IP Edge, a patent monetization firm, and Mavexar, an affiliated consulting shop. The district court was concerned that the real parties in interest may have been concealed, that fictitious patent assignments were filed with the USPTO to shield those parties from liability, and that the plaintiff LLCs’ attorneys may have violated the Rules of Professional Conduct by taking direction from Mavexar without their formal-clients’ informed consent.

While I am not generally opposed to litigation finance, the Mavexar and IP Edge controversy highlights significant ethical concerns associated with the practice. Chief Judge Colm F. Connolly of the U.S. District Court for Delaware uncovered a scheme involving shell companies like Nimitz Technologies, Mellaconic IP, and Lamplight Licensing. These entities, ostensibly owned by individuals with little understanding of the patents or litigation process, were used to file numerous patent infringement lawsuits. The real control and financial benefit rested with IP Edge and its affiliate Mavexar.

Continue reading The Phantom Menace: Federal Circuit Upholds Judge Connolly’s Investigative Powers Evan After Dismissal at Patently-O.

The Phantom Menace: Federal Circuit Upholds Judge Connolly’s Investigative Powers Evan After Dismissal

by Dennis Crouch

In Backertop Licensing LLC v. Canary Connect, Inc., the Federal Circuit addressed the scope of a district court’s inherent authority to investigate potential litigation misconduct. Chief Judge Connolly of the District of Delaware had initiated an inquiry into dozens of patent infringement cases filed by plaintiff LLCs associated with IP Edge, a patent monetization firm, and Mavexar, an affiliated consulting shop. The district court was concerned that the real parties in interest may have been concealed, that fictitious patent assignments were filed with the USPTO to shield those parties from liability, and that the plaintiff LLCs’ attorneys may have violated the Rules of Professional Conduct by taking direction from Mavexar without their formal-clients’ informed consent.

While I am not generally opposed to litigation finance, the Mavexar and IP Edge controversy highlights significant ethical concerns associated with the practice. Chief Judge Colm F. Connolly of the U.S. District Court for Delaware uncovered a scheme involving shell companies like Nimitz Technologies, Mellaconic IP, and Lamplight Licensing. These entities, ostensibly owned by individuals with little understanding of the patents or litigation process, were used to file numerous patent infringement lawsuits. The real control and financial benefit rested with IP Edge and its affiliate Mavexar.

Continue reading The Phantom Menace: Federal Circuit Upholds Judge Connolly’s Investigative Powers Evan After Dismissal at Patently-O.

Zimmer v. Insall: The Power of Arbitration Agreements in Patent Royalty Disputes

by Dennis Crouch

In the recent case of Zimmer Biomet Holdings, Inc. v. Insall, No. 23-1888 (7th Cir.  July 12, 2024), the Seventh Circuit affirmed an arbitration award requiring Zimmer to continue paying royalties to the estate of Dr. John Insall even after the expiration of the underlying patents.  This decision highlights the significant deference afforded to arbitration agreements and the limited ability of courts to vacate arbitral awards, even when they conflict with Supreme Court precedent.

The key precedents underlying the dispute in Zimmer v. Insall are Brulotte v. Thys Co., 379 U.S. 29 (1964) and Kimble v. Marvel Entertainment, LLC, 576 U.S. 446 (2015). In Brulotte, the Supreme Court held that “a patentee’s use of a royalty agreement that projects beyond the expiration date of the patent is unlawful per se.” This rule, known as the Brulotte rule, has faced criticism over the years for being economically irrational and inflexible. The Supreme Court directly revisited the rule in Kimble, but ultimately chose to uphold the rule based on stare decisis. However, the Court also clarified that “post-expiration royalties are allowable so long as tied to a non-patent right—even when closely related to a patent.” This left open the possibility for parties to structure royalty agreements to survive patent expiration, as long as the post-expiration royalties are non-separably grounded in a peppercorn of non-patent rights.

Continue reading Zimmer v. Insall: The Power of Arbitration Agreements in Patent Royalty Disputes at Patently-O.

Post-Loper Bright Patent Law: Will SCOTUS Redefine PTAB Discretion?

Post-Loper Bright Patent Law: Will SCOTUS Redefine PTAB Discretion?

by Dennis Crouch

The Supreme Court has requested a response to a pending petition for certiorari in United Therapeutics Corp. v. Liquidia Technologies, Inc., indicating that at least one justice sees potential merit in the case. The petition challenges the Federal Circuit’s application of the statutory limits on the Patent Trial and Appeal Board’s (PTAB) authority in inter partes review (IPR) proceedings.  I believe that there is a potential that the Court will issue a grant-vacate-remand (GVR) order, asking the Federal Circuit to reconsider its deferential decision based upon Loper Bright.

UTC owns the patent at issue, U.S. Patent No. 10,716,793, which is directed to methods of treating pulmonary hypertension using treprostinil. In the petition for certiorari, UTC argues that the Federal Circuit erred by deferring to the PTAB’s discretion instead of conducting a de novo review of the PTAB’s compliance with 35 U.S.C. § 312. This provision requires IPR petitions to identify “with particularity” the grounds and evidence supporting the challenge to each patent claim.

  • 20240610131548675_UTC.cert.petition
  • 20240610131758287_UTC.cert.appendix

UTC contends that the PTAB violated § 312 by relying on grounds and printed publications not raised in Liquidia’s initial IPR petition.

Continue reading Post-Loper Bright Patent Law: Will SCOTUS Redefine PTAB Discretion? at Patently-O.

The Long Arm of APEX: When (and Where) does Amazon’s Private Enforcement Mechanism Create Personal Jurisdictional

By Dennis Crouch

This case would be great for a 2L law review note.

Back in May 2024, the Federal Circuit issued an important decision holding that a patentee’s use of Amazon’s patent enforcement process (APEX) to target an alleged infringer’s listings can subject the patent owner to specific personal jurisdiction in the alleged infringer’s home state – despite no direct contacts with that state.  SnapRays, LLC v. Lighting Defense Group, LLC, No. 2023-1184 (Fed. Cir. 2024). The patentee has now petitioned for en banc rehearing, arguing that the opinion conflicts with prior Federal Circuit precedent and makes a holding that the Supreme Court at least implicitly rejected in Walden.  The case is important as APEX and other similar private sales-channel enforcement processes become increasingly popular. SnapRays En Banc Petition.

My view: The Federal Circuit erred here. While initiating the APEX action would certainly open the patentee up to a declaratory judgment lawsuit, that lawsuit must be filed in a jurisdiction where the patentee has sufficient minimum contacts, not simply wherever the accused infringer happens to be located, even if (as here) the patentee knew of the accused infringer’s location.

Continue reading The Long Arm of APEX: When (and Where) does Amazon’s Private Enforcement Mechanism Create Personal Jurisdictional at Patently-O.