BLIP: Blogging Patents

It's a simple fact that the United States Patent and Trademark Office (the "USPTO") is inundated with patent applications. Given the sheer volume of applications, patent examiners can only spend a limited amount of time examining those applications. Further, given the fact that an applicant for a patent does not have to conduct a "prior art" search before filing, it is virtually impossible for an examiner to turn up all of the prior art that is relevant to a patent application.

Unbeknownst to many patent practitioners, however, the USPTO is getting ready to wrap up a yearlong pilot project directed at giving the examiners a little help in turning up prior art.

Last year the USPTO, in conjunction with the New York Law School, launched a program titled "Peer to Patent." This pilot project enables the public to comment on and submit prior art that may be relevant to pending patent applications. The project is somewhat limited in scope as only patent applications that relate to computer architecture, software, and information security are eligible for this process and applicants must agree to submit their patent applications to this process. However, preliminary numbers reported by the organization indicate that the project may be an effective means of reviewing patent applications.

According to the "Peer to Patent" Web site, over 2,000 people have signed up to participate as reviewers of patent applications and have submitted 192 pieces of prior art on 42 patent applications.

For more information about the process, see the USPTO's description of the program here.

Mr. Ohman responded to yesterday's posting, expressing concerns as to the accuracy of its content. In an email message to me, he said that his design patent was amended because the USPTO simply asked him to choose one design of the three he originally filed, that he was not "forced" to amend his claims, and that the Patent Office did not refuse anything. See Yesterday's Posting. He also stated that he felt the information in yesterday's posting to be defamatory and libel. It was certainly not the intent of the posting to cause any hurt feelings. But, the discussion of the prosecution of Mr. Ohman's patent-in-suit is factually accurate. To make the record on this site clear and complete, I've prepared the following summary of the prosecution history of the design patent that Mr. Ohman asserted in his lawsuit against the Lance Armstrong Foundation.

The entire prosecution history can be viewed by those interested in the details on the PTO website. USPTO Public Pair Portal. The record shows that on 2/21/2007, the Patent Office did reject the then-pending claim to a pet collar with the LIVESTRONG marking, citing to evidence of LAF's prior use of the design on its web-site. The record also shows that in response to this rejection, the applicant cancelled two figures and renumberd one so as to claim the BARKSTRONG marking instead of the LIVESTRONG marking.

The only patent that Mr. Ohlman's complaint alleges has been infringed is United States Design Patent No. D556,389. Mr. Ohman filed the original application that gave rise to this patent on July 6, 2005. The application number was 29/233,646. In the application, he tried to obtain claims to pet collars with three different marks: Fig. 1 - LIVESTRONG; Fig. 2 - BARKSTRONG; and Fig. 3 PURRSTRONG.

On 12/1/2006, the Patent Office issued a restriction requirement. A restriction requirement requires the applicant to select one invention for one patent, and, if he wishes to pursue other inventions, to pay additional application fees for processing those inventions. On 12/12/2006, Mr. Ohman elected to pursue Group I, which was the design using the phrase LIVESTRONG.

On 2/21/2007, the Patent Office issued a rejection to the claim. Page 3 of the rejection states "[t]he claim is rejected under 35 U.S.C. 103(a) as being unpatentable over the "LIVESTRONG" logo depicted on the Lance Armstrong Foundation website as of May 6, 2004.

On 5/21/2007, in response to the rejection by the Patent Office, the applicant submitted an amendment, in which he cancelled the LIVESTRONG and PURRSTRONG drawings from the application, and changed "FIG. 2" for BARKSTRONG to "FIG. 1." The applicant's stated reason for this change was that "[t]he Office Action objected to the specification, claim, and drawings due to informalities." See Response at 5. The response made no mention of the pending 103 rejection.

The claim to the BARKSTRONG design was then allowed. On 10/2/2007, before the patent issued, Mr. Ohman appears to have filed two continuing applications, numbered 29/292,189 and 29/292,189.

In his comment to yesterday's post, Mr. Ohman notes that there is "no mention or claim of the divisional patent (LIVESTRONG) in this suit." Technically, that statement is true. The only patent asserted in the lawsuit Mr. Ohman filed against the Lance Armstrong Foundation is the one claiming the "BARKSTRONG" design. The two continuing applications filed on 10/2/2007, presumably one of which is the divisional application referred to by Mr. Ohman, have not issued as patents and are not currently available to the public. However, Mr. Ohman's reference to a "divisional patent (LIVESTRONG)" implies that he is presently seeking to obtain a design patent for the "LIVESTRONG" design. Because no such patent has issued, there is of course no such patent at issue in Mr. Ohman's current lawsuit.

In an apparent retaliatory lawsuit, Chris Ohman has sued the Lance Armstrong Foundation ("LAF") for infringing a design patent to its "BARKSTRONG" dog collar design. In his complaint, filed in the Northern District of Oklahoma last week, Mr. Ohman claims to own patent rights to the use of the LAF's signature LIVESTRONG mark on pet collars , and accuses "LIVESTRONG" pet collars sold by the LAF of infringement. The lawsuit appears extremely questionable in light of the fact that the Patent Office expressly denied Mr. Ohman design patent protection for collars with the word "LIVESTRONG " printed on them because of prior art found on none other than LAF 's own website.

The dispute between Mr. Ohman and the LAF appears to have begun in June, 2005 when Mr. Ohman began selling yellow pet collars with the markings BARKSTRONG and PURRSTRONG. Last September, to prevent dilution of its Trademark, LAF filed suit against Ohman in the Western District of Texas. According to the Texas complaint filed by the LAF, Mr. Ohman approached the LAF in July of 2005, a few weeks after filing a design patent application that, if granted, would give Ohman a patent on the use of LAF's signature LIVESTRONG mark for dog collars. Mr. Ohman's tactic did not work, and no license was granted. Meanwhile, the Patent Office refused to grant Ohman a patent with the LIVESTRONG mark, and, as shown below, Ohman was forced to remove it from his proposed drawings.

Undeterred, Mr. Ohman filed a lawsuit that, when scrutinized by the Court, may well raise concerns. Stay tuned for the continuing battle to see whose collars are the strongest.

If you help your industry adopt your patented technology as a standard and then sue companies that use the standard, bad things can happen. You might lose your patent rights, be sued or prosecuted for antitrust violations, unfair competition, and fraud. Even if you ultimately win your case at trial ... or on appeal ... the cost of getting mired in allegations of abusing the standards process can be high. Rambus, a memory design and patent licensing company, presents a case study in how costly and time consuming standards-related patent disputes can be. The cost to the industry can be even higher, which is why some standards bodies have been reacting to the problem by changing their patent polices to require more disclosure of patents and licensing plans.

THE RAMBUS SAGA

Rambus is a licensing company that holds a number of patents relating to DRAM memory architecture. In the early 1990s, representatives from Rambus attended meetings of the JEDEC working group that was developing new standards for what became known as the double data rate, or "DDR" type of DRAM. During those meetings, Rambus did not disclose some of its patents and patent applications to the committee. The new technology was included in the standard, and became widely used.

Beginning in 1999, after the new standard was well established, Rambus informed many of the major players in the DRAM market that it held patent rights that covered the standard, and warned them that they'd better pay for licenses. Rambus extracted substantial license fees from Samsung and Toshiba, and increased the pressure on others by suing several industry participants. This led the FTC bring an antitrust lawsuit against Rambus in 2002, alleging unfair and deceptive acts or practices in violation of the FTC act, and unlawful monopolization in violation of the Sherman Antitrust Act. Meanwhile, Infineon, who Rambus accused of patent infringement, countersued Rambus for fraud due to its conduct before the JEDEC standards committee.

Both the FTC and a jury in the Eastern District of Virginia found that Rambus conduct was wrong, and that Rambus was liable for antitrust and fraud. However, both decisions were ultimately overturned because the then-prevailing language of JEDEC's patent policy was found to be less-than-clear, both results were ultimately overturned. The Federal Circuit Court of Appeals overturned the jury's finding of fraud in 2003 because the wording of JEDEC's patent policy was found not to create a clear duty for Rambus to have disclosed its patents. Rambus, Inc., v. Infineon Tech. AG, 318 F.3d 1081, 1098 (Fed. Cir. 2003). However, Rambus quickly settled its remaining patent dispute with Infineon after the Virginia trial court found Rambus guilty of spoliation of evidence. In a subsequent dispute with Samsung, Rambus dismissed its patent claims and agreed to pay Samsung's attorney's fees to avoid further adverse decisions. On Tuesday, the Federal Circuit found that by dismissing the dispute and offering to pay Samsung's attorney's fees, Rambus rendered all remaining disputes moot. See Rambus v. Samsung Decision. As for the FTC action, last week, the DC Court of Appeals overturned the judgment of the FTC because the FTC failed to prove that Rambus had injured competitors. See Rambus Inc. v. FTC, Slip Op. 07-1086, 4/22/2008.

IMPLICATIONS FOR STANDARD SETTING

The Rambus cases, and the allegations associated with them have been closely watched by standards organizations, and the companies that participate in standards efforts. While Rambus appears to have avoided disaster, some standard setting bodies are beginning to change their policies and procedures to make patent obligations, and positions more clear. Historically, this has been a sticky area for standards organizations. On the one hand, standards organizations and their members wish to avoid "hold up" situations like the Rambus case. On the other hand, standards organizations and their members do not wish to be accused of price fixing or other anti-competitive behavior by adopting coercive polices that are later found to injure competition.

Recently, two standards bodies have sought and obtained approval from the department of justice of patent policies that should lead to increased patent disclosure. The IEEE obtained approval from the Department of Justice to adopt a policy that requires participants in standard setting initiatives to take a definitive, binding position regarding their willingness to license patents, or to expressly refuse to provide assurance. IEEE Announcement Another standards organization, VITA, which creates standards for certain computer bus architectures, also obtained DOJ approval of its new standards policy requiring disclosure of patents and licensing terms by industry participants. VITA Letter from DOJ.

At the same time, three of the worlds largest standards organizations, namely the IEC, ISO, and ITU, have adopted patent policies that strongly encourage disclosure of patents that are necessary for standards, and require participants in the standard setting practice to make patent positions more clear. See IEC, ISO, and ITU press release.

As more standards organizations change their polices to favor increased disclosure and more transparent obligations on their members, "hold-up" situations, such as happened in Rambus, should become less common. However, the new policies are likely to increase the burden on participating organizations that find themselves under increased pressure to commit to licensing terms before they fully understand the value of their patents.

The most difficult issue in many patent cases is claim construction, that is, the court's interpretation and articulation of what exactly the claims of the patent mean. Interpreting patent claims is hard work. It usually involves consideration of technical jargon that, especially when significant time has passed since the patent was filed, may be obsolete or just plain awkward. As a result, courts don't always get claim construction right the first time. Indeed, a substantial percentage--depending on whom you ask, the anecdotal figure is around 50 percent--of trial court claim constructions are successfully challenged on appeal.

The high reversal rate for claim construction is especially problematic because most claim construction decisions cannot be immediately appealed. Interpreting the claims is only the first step in the infringement analysis. After they're interpreted, that construction has to be applied to the accused product or process. Most often that's something the jury is supposed to decide, which means you may have to go through a long and costly trial before a judgment is entered. That judgment--either that the patent claims are infringed or they are not--is what the U.S. Court of Appeals for the Federal Circuit (the "Federal Circuit") ultimately reviews.

However, if the claim construction was wrong in the first place, the jury's verdict on infringement is usually wrong, too. That means a second trial will likely be necessary, which results in more work for the courts, more time lost in litigation, and more money spent on lawyers. The rub, argue critics, is that much of this additional expense and inefficiency could be avoided if claim construction opinions could be appealed prior to a final judgment on infringement.

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A patent is a deal with the U.S. government. In exchange for elevating the knowledge of the public in general by publishing a description of an invention, the government gives, in return, a "monopoly."

But the monopoly in the patent world is a different animal than what most would consider a true monopoly. When most people think about a monopoly, they think of the ability of one person or company to assert dominance in a certain market by being the only seller of a product. That is not the case in the patent world. A patent does not guarantee any dominance in any market whatsoever; in fact, it does not even give the patent holder the right to make the patented product at all.

While seemingly counterintuitive, this is the way the patent system has to work because of the nature of patentable inventions. Sir Isaac Newton, arguably one of the greatest scientists and inventors of all time, perfectly but unintentionally characterized the patent system when he said, "If I have seen further it is by standing on ye shoulders of Giants."

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The Federal Circuit's recent decision in Aristocrat Technologies will require software patent drafters to take more care to describe the algorithms covered by their software--or risk patent invalidity. (See Aristocrat Technologies.) The court held that expert testimony that a programmer would know how to write code to perform a given function cannot supplement an incomplete patent disclosure when software claims are written using "mean-plus-function" format. Means-plus-function format means that something is claimed by the function it performs rather than by a specific structure--for example, a means-plus-function claim might recite a "means for fastening paper together" as opposed to a "paper clip." Software claims written in means-plus-function form are invalid unless the specification discloses an algorithm that performs the function stated in the claims.

Because many software patents fail to describe the necessary algorithms, the Aristocrat case will likely result in more software patent claims being invalidated by the courts (at least those written in means-plus-function format) and should encourage patent practitioners to include more details in their specifications. Though the algorithm need not be spelled out in detail, patent practitioners would do well to make sure that their software patents discloses algorithms.

The problem of unreadable software claims
In light of the "algorithm rule", one might ask why a patentee would ever write a software patent using "means-plus-function" language in the first place. One reason has to do with the difficulty patent drafters face writing claims that cover software.

Patent claims are a linguistic nightmare, a fact that tends to be all the more true for software inventions. Part of the reason is that no matter how complex the invention may be, every patent claim is written in one long run-on sentence. Though not required by Congress, Patent Office procedure insists that patent claims be written in single-sentence form. (See MPEP Sec. 608.01(m).) In the only case to challenge the one-sentence rule, the court sided with the Patent Office. See Fressola v. Manbeck, 36 USPQ2d 1211 (D.D.C. 1995). By its very nature, software tends to be a complex series of steps, often iterative and interrelated--which makes it hard to describe precisely in a single sentence.

For example, if a software invention included a mortgage calculator with a routine for calculating compound interest, one way to claim the subroutine would be to detail the steps of the algorithm: (1) receiving the principal, interest rate, compounding period, and term of the loan; (2) applying the compound interest formula to determine the amount to be paid; (3) determining the number of payments in the payment period; and (4) dividing the amount to be paid by the number of payments to determine the size of each payment. Writing this out, along with the other aspects of the program that presumably made it patentable, in a single sentence, all but guarantees unreadable prose.

The use of means-plus-function claims in software
One solution that patent lawyers sometimes use is to write claims using the means-plus-function format. Rather than detail all the steps performed by the computer program, the patent drafter recites a "means for calculating compound interest." This kind of patent shorthand makes the claim much easier to read. But, there is an important catch. Claims written in means-plus function language do not cover every means for performing the recited function. Instead, by statute, they are limited to the structure disclosed in the specification that is clearly linked to performing the function, and to equivalent structures. (See 35 USC § 112, ¶ 6) In the world of software, this means the claims are limited to the algorithm or algorithms disclosed in the patent, and equivalents thereto.

The problem arises if the patent never mentions the general steps that a computer would follow to calculate interest. There is no doubt that a skilled programmer could write a mortgage interest calculator, perhaps as a subroutine, perhaps as an object, perhaps as a lookup table. There could be many ways to write such a program, all within the expected ability of an undergraduate computer student. But, that's not the issue. If the patent claim recites a "means for calculating compound interest," then the patent must disclose an algorithm that is clearly linked to calculating compound interest.

One alternative is simply not to use means-plus-function claim language, and to find a different solution to the claim drafting challenge. But even so, it still makes sense to disclose some specific algorithms in the patent. Patents and the form of their claims often evolve during the years before they issue from the Patent Office. It will generally be good practice to err on the side of additional disclosure up front to provide support for the claims as they evolve.

There are a lot of strong opinions with respect to software patents. Many people are highly critical of them because they feel that copyright alone is enough protection for software. The argument goes that copyright is a better fit than patent law.

For example, copyright is self-executing. That means that you get a copyright in your program as soon as you write it. In contrast, a patent is obtained only after filing and prosecuting - and in the process spending a lot of money on - a patent application.

Moreover, copyright is supposed to protect a specific expression - not broader ideas found in that expression. One major argument against software patents is, that in order to maintain the lightning pace of software innovation, developers must to be free to use general concepts pioneered by others so long as they don't copy the actual code.

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Unlike other areas of the law where doing something in public can land you in a lawsuit (or at least a courtroom with a nice, slightly used orange jumpsuit), sometimes in patent law doing things in public can get you out of a lawsuit.

When a company finds itself in court defending against a patent lawsuit, it will usually assert two major defenses. First, the company will say "I don't practice (or produce) what is claimed in this patent." Second, a defendant in a patent lawsuit will also attempt to "invalidate" the claims of the patent by showing that "prior art" described the claims in the patent prior to the application date of the patent. While this defense can take multiple forms (see, for example, 35 U.S.C. § 102 ), a defendant must often show that the prior art relied upon was in fact publicly known or publicly used. So now its time for a pop quiz--which one of three options would you consider not being "publicly accessible" for the purposes of United States patent law:

A: The use of a centrifuge in a secure laboratory at the National Institute for Health;

B: The posting of a paper on an unsecured FTP server; or

C: Indexing a dissertation in a paper file and placing it on a shelf...in Germany.

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