Category: copyrights

It’s the Words, Not the Ideas, that Are Copyrightable

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The U.S. Court of Appeals for the Seventh Circuit dismissed a lawsuit claiming that Elton John and his songwriter partner Bernie Taupin had plagiarized their hit song “Nikita” from a song called “Natasha,” explaining that copyright law does not cover general ideas, but only the specific expression of an idea.  Guy Hobbs v. Elton John, Case No. 12-3652 (7th Cir., July 17, 2013) (Manion, J.).

Guy Hobbs composed “Natasha,” a song about a love story between a British man and a Ukrainian woman.  In 1983, Hobbs registered his copyright in the song and then sent the song to several music publishers, one of them being Elton John’s publisher, Big Pig.  However, the song was never published.  John released the Nikita song in 1985, wherein the singer from the west describes his love for a girl named Nikita, who he saw through the wall and who was on the other side of the line.  The copyright in Elton John song was registered with the U.S. Copyright Office by Big Pig.

Hobbs claimed that he first learned of the Nikita song in 2001.  He alleged that the lyrics infringed his copyright of Natasha and sought compensation from John and Taupin.  Hobbs later sued John, Taupin, and Big Pig for copyright infringement.  Hobbs claimed that his work was entitled to copyright protection because his selection and combination of the elements in Natasha constituted a “unique combination.”  Hobbs argued that the number of similar elements between the two works supported a claim for copyright infringement.

The district court held that the elements identified by Hobbs were not entitled to copyright protection when considered alone.  Hobbs had not established a “substantial similarity” between Natasha, a song about a British man and a Ukrainian woman who did meet, and John’s Nikita song describing an East German woman peering through the Berlin wall at a man she never met.  The district court also rejected Hobbs claim that the elements in the song created a unique combination that was copyrightable.  The district court held that although the theme of the two songs had some similar elements in common, the elements identified were not protectable under the Copyright Act.  Hobbs appealed.

The 7th Circuit agreed, concluding that “Natasha and Nikita simply tell different stories, and are separated by much more than small cosmetic differences.”  The 7th Circuit stated that the Copyright Act does not protect general ideas, but only the particular expression of an idea.  In addition, the Copyright Act does not protect “incidents, characters or settings which are as a practical matter indispensable, or at least standard, in the treatment of a given topic.”  The 7th Circuit concluded that “as a matter of law Natasha and Nikita are not substantially similar because they do not share enough unique features to give rise to a breach of the duty not to copy another’s work.”

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Round Up – Intellectual Property and Cyber Security Things You May Have Missed (Including Some Good Summer Cocktail Banter Material)

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Cyber Security Report – Earlier this year, Verizon released its 2013 Data Breach Investigations Report.  The report analyzes and presents data regarding the current state of various data breaches and network attacks.  Some of the results are surprising.

  •             92% of breaches are perpetrated by outsiders
  •             19% of breaches are attributed to state-affiliated actors
  •             76% of network intrusions exploit weak or stolen credentials
  •             66% took months or more to discover

Do Trademark Lawyers Matter? – An empirical study, published in the Stanford Technology Law Review, provided the results of a grueling analysis of 25 years worth of data from the United States Patent and Trademark Office records on whether being represented by a trademark attorney makes a difference in the likelihood of success in getting your mark registered.  The results?  YES!  It turns out that, overall, trademark applicants who are represented by an attorney are 50% more likely to have their marks registered.  The results are even more dramatic when an application faces an obstacle (e.g., an office action).  In those instances, applicants were found to be 68% more likely to proceed to publication when represented by counsel.  Perhaps its time for a national trademark lawyer appreciation day! (I’m not holding my breath).

Does Keyword Advertising Really Work?  eBay recently released a study, entitled “Consumer Heterogeneity and Paid Search Effectiveness: A Large Scale Field Experiment” which analyzed the effectiveness of eBay’s keyword advertising efforts.  So does keyword advertising really work?  Not so much.  According to the study, for well known brands (like eBay), new and infrequent users may be more influenced by keyword triggered advertisements.  But more experienced searchers and otherwise loyal brand users are not influenced by the ads.  When eBay stopped its keyword advertising, almost all of the traffic lost from the absence of the ad was picked up in the native search results.  It’s important to note, however, that this study was focused on a single well known brand.  The results may be quite different for other brands or for less well known brands.  Moreover, the study says nothing about the use of a trademark by a competitor as a keyword to drive traffic to the competitor’s website.

Marketing Your Mobile App – The FTC has released guidelines for mobile app developers when advertising their software.  The plain language guide is very high level, but does include some helpful tid bits to remember.  Highlights include:

  • Advertising is everything a company tells a prospective buyer about its app (whether its in the formal ad campaign or in other communications).
  • Don’t bury key disclosures in “dense blocks of legal mumbo jumbo” or behind hyperlinks.
  • Build in privacy by design, including principles used in selecting default settings.
  • If you change your privacy policy, you need to get user’s consent.  Merely editing the language of the policy isn’t enough.

Effective Disclosures in Digital Advertising – The FTC also released guidelines for online advertising.  This new guidance focuses on the peculiarities and challenges associated with online advertising.  Where this adds new value is in its analysis and detail (with examples!) of the following areas:

  • Proximity and Placement – where disclosures have to be placed to be effective
  • Hyperlinks – including proper labeling and placement
  • Prominence – including use of size, color and graphics
  • Distractions – risks from graphics, sounds and links that may distract from disclosures
  • Multimedia – use of audio and video

Attack on “Happy Birthday” Copyright.  Salon.com reported yesterday that a class action suit has been filed to attack the copyright in the popular birthday celebration tune.  According to the report, the lawsuit was prompted by a documentary uncovering evidence that the song was originally published as early as 1893 and that the current copyright is based on a 1924 publication date which grants the work 95 years of copyright protection.  Based on my count, there’s only about 6 years left in the alleged copyright to begin with.  Hopefully the lawsuit gets resolved before then.

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Administration Launches Strategy on Mitigating Theft of U.S. Trade Secrets

The National Law Review recently published an article, Administration Launches Strategy on Mitigating Theft of U.S. Trade Secrets, written by Lauren M. Papenhausen with McDermott Will & Emery:

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The strategy announced on February 20, 2013, should serve as both a wake-up call from the government and an offer of assistance.  Given the losses that can arise from competitors’ purposeful theft of trade secrets, entities should review the announcement and decide whether they need to be more active in protecting their trade secrets.  The strategy also offers opportunities for increased collaboration with the government.

On February 20, 2013, the White House announced an “Administration Strategy on Mitigating the Theft of U.S. Trade Secrets.”  Companies should view the announcement of this strategy as both a wake-up call from the government and an offer of assistance.  Given the losses that can arise from competitors’ purposeful theft of trade secrets, entities should review this government announcement and decide whether they need to be more active in protecting their trade secrets.

The administration strategy articulates a broad governmental commitment to addressing an “accelerating” threat to U.S. intellectual property.  The strategy encompasses five action items:

  • Focusing diplomatic efforts to protect trade secrets through diplomatic pressure, trade policy and cooperation with international entities
  • Promoting voluntary best practices by private industry to protect trade secrets
  • Enhancing domestic law enforcement, including through outreach and information-sharing with the private sector
  • Improving domestic legislation to combat trade secret theft
  • Improving public awareness and stakeholder outreach

Three main themes emerge from the administration strategy that are important for U.S. businesses.

First, the strategy and its supporting documentation highlight how frighteningly real the prospect of trade secrets theft is.  The White House report is peppered with references to household name companies that have been victimized by trade secrets theft over the past few years, often at a cost of tens of millions of dollars or more.  Mandated reports from the defense industry to the government indicate a 75 percent increase between FY2010 and FY2011 in reports of suspicious activity aimed at acquiring protected information.  Coupled with a recent New York Times article asserting Chinese government involvement in more than 100 attempted cyber attacks on U.S. companies since 2006, these reports warrant sitting up and taking notice.  According to a report by the Office of the National Counterintelligence Executive, particular targets include companies that possess the following:

  • Information and communications technologies
  • Business information that relates to supplies of scarce natural resources or that gives foreign actors an edge in negotiations with U.S. businesses or the U.S. government
  • Military technologies, particularly in connection with marine systems, unmanned aerial vehicles and other aerospace/aeronautic technologies
  • Civilian and dual-use technologies in sectors likely to experience fast growth, such as clean energy, health care and pharmaceuticals, advanced materials and manufacturing techniques, and agricultural technology

Second, the government alone cannot solve the problem.  The administration commits to making the investigation and prosecution of trade secret theft a “top priority” and states that the Federal Bureau of Investigation has increased the number of trade secret theft investigations by 29 percent since 2010.  On its face, however, a 29 percent increase in investigations cannot keep pace with a 75 percent increase in attempted trade secret thefts.  Historically, as a result of limited resources, the government has been able to address only a tiny fraction of trade secret thefts, and there is no indication that there will be the massive influx of resources necessary to change this dynamic materially.  Indeed, the administration strategy recognizes the need for public-private partnerships on this issue and asks companies and industry associations to develop and adopt voluntary best practices to protect themselves against trade secret theft.  And, of course, there are significant drawbacks to any after-the-fact solution, whether relying on government intervention or a private lawsuit.

The best solution is to prevent a trade secret theft from ever occurring.  Even if that is not possible, having taken strong measures to protect trade secrets will aid success both in any civil litigation against the perpetrator and in any criminal action the government may bring.  Entities should consider at least the following types of protective measures:

  • Research and development compartmentalization, i.e., keeping information on a “need to know” basis, particularly where outside contractors are involved in any aspect of the process
  • Information security policies, e.g., requiring multiple passwords or multi-factor authentication measures and providing for data encryption
  • Physical security policies, e.g., using controlled access cards and an alarm system
  • Human resources policies, e.g., using employee non-disclosure agreements, conducting employee training on the protection of trade secrets and performing exit interviews.

It also will be important in any future litigation that a company has clearly designated as confidential any materials it may wish to assert are trade secrets.

Third, the new administration approach to trade secrets offers some opportunities for U.S. companies.

The government interest in enhancing law enforcement operations indicates that businesses may have a better chance of encouraging the government to investigate and bring criminal charges under the Economic Espionage Act (EEA) against the perpetrators of trade secret thefts.  The possibility of seeking government involvement is a powerful tool that should be considered and discussed with counsel any time there is a significant suspected trade secret theft.  Obtaining government involvement in specific instances of trade secret theft can allow businesses to take advantage of information learned via government tactics such as undercover investigations and search warrants.  It also can significantly enhance any civil litigation—for example, a finding of criminal liability can make a civil outcome a foregone conclusion.

The administration strategy’s focus on improving domestic legislation and increasing communication with the private sector suggests that there is an opportunity for the private sector to collaborate with government actors in communicating industry needs and shaping policy.  For example, it is possible that the time is ripe for an amendment to the EEA (currently a federal criminal statute that offers no private right of action) to create a federal, private cause of action for misappropriation of trade secrets.  A bill to this effect was introduced in Congress in 2012 and did not progress, but two other amendments to strengthen the EEA that passed overwhelmingly in December 2012, plus the recently issued administration strategy, suggest there may be gathering momentum for such a change.

In an executive order signed on February 12, 2013, entitled “Improving Critical Infrastructure Cybersecurity,” President Obama outlined government plans to significantly increase the amount of information that the government shares with private sector entities about cyber threats.  Specifically, the order directs government agencies to develop procedures to create and disseminate to targeted entities unclassified reports of cyber threats that identify them as targets, to disseminate classified reports of cyber threats under certain circumstances to “critical infrastructure entities,” and to expand the Enhanced Cybersecurity Services program (previously available only to defense contractors to assist in information-sharing about cyber threats and protection of trade secrets) to “eligible critical infrastructure companies or commercial service providers that offer security services to critical infrastructure.”  The directives in the executive order are in addition to and complement various information-sharing tactics set forth in the administration strategy designed to provide warnings, threat assessments and other information to industry.  Companies, particularly those involved in the power grid or the provision of other utilities or critical systems, should be aware of the possibility of obtaining additional information from the government about threats to protected information.

© 2013 McDermott Will & Emery

Trade Secret Misappropriation: When An Insider Takes Your Trade Secrets With Them

Raymond Law Group LLC‘s Stephen G. Troiano recently had an article, Trade Secret Misappropriation: When An Insider Takes Your Trade Secrets With Them, featured in The National Law Review:

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While companies are often focused on outsider risks such as breach of their systems through a stolen laptop or hacking, often the biggest risk is from insiders themselves. Such problems of access management with existing employees, independent contractors and other persons are as much a threat to proprietary information as threats from outside sources.

In any industry dominated by two main players there will be intense competition for an advantage. Advanced Micro Devices and Nvida dominate the graphics card market. They put out competing models of graphics cards at similar price points. When played by the rules, such competition is beneficial for both the industry and consumers.

AMD has sued four former employees for allegedly taking “sensitive” documents when they left to work for Nvidia. In its complaint, filed in the 1st Circuit District Court of Massachusetts, AMD claims this is “an extraordinary case of trade secret transfer/misappropriation and strategic employee solicitation.” Allegedly, forensically recovered data show that when the AMD employees left in July of 2012 they transferred thousands of files to external hard drives that they then took with them. Advanced Micro Devices, Inc. v. Feldstein et al, No. 4:2013cv40007 (1st Cir. 2013).

On January 14, 2013 the District Court of Massachusetts granted AMD’s ex-parte temporary restraining order finding AMD would suffer immediate and irreparable injury if the Court did not issue the TRO. The TRO required the AMD employees to immediately provide their computers and storage devices for forensic evaluation and to refrain from using or disclosing any AMD confidential information.

The employees did not have a non-compete contract. Instead the complaint is centered on an allegation of misappropriation of trade secrets. While both AMD and Nvidia are extremely competitive in the consumer discrete gpu market involving PC gaming enthusiasts, there are rumors that AMD managed to secure their hardware to be placed in both forthcoming next-generation consoles, Sony PlayStation 4 and Microsoft Xbox 720. AMD’s TRO and ultimate goal of the suit may therefore be to preclude any of their proprietary technology from being used by its former employees to assist Nvidia in the future.

The law does protect companies and individuals such as AMD from having their trade secrets misappropriated. The AMD case has only recently been filed and therefore it is unclear what the response from the employees will be. What is clear is how fast AMD was able to move to deal with such a potential insider threat. Companies need to be aware of who has access to what data and for how long. Therefore, in the event of a breach, whether internal or external, companies can move quickly to isolate and identify the breach and take steps such as litigation to ensure their proprietary information is protected.

© 2013 by Raymond Law Group LLC

In a Rarely-Seen Joint-Effort in the Competition Arena, the DOJ and the USPTO Unite in Issuing a Policy Statement on Remedies Involving Standard Essential Patents

The National Law Review recently published an article, In a Rarely-Seen Joint-Effort in the Competition Arena, the DOJ and the USPTO Unite in Issuing a Policy Statement on Remedies Involving Standard Essential Patents, written by the Antitrust and Trade Regulation Practice of Sheppard, Mullin, Richter & Hampton LLP:

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On January 8, 2013 – less than a week after the Federal Trade Commission (“FTC”) entered into a consent order with Google,[1] under which Google is generally banned from seeking injunctions on its F/RAND[2] -encumbered standard essential patents (“SEPs”)[3] – the United States Department of Justice (“DOJ”) banded together with the United States Patent and Trademark Office (“USPTO”) (jointly referred here as “the Agencies”) in issuing the Policy Statement on Remedies for Standard Essential Patents Subject to F/RAND Commitment (“Policy Statement on Remedies for SEPs”).

This was a rare pairing in that, in the past, the DOJ has generally joined forces with the FTC in jointly issuing guidelines in the area of competition and antitrust enforcement policy. Examples include the DOJ-FTC joint “Antitrust Policy Enforcement Regarding Accountable Care Organizations,” “Antitrust Enforcement and Intellectual Property Rights: Promoting Innovation and Competition,” “Antitrust Guidelines for the Licensing of Intellectual Property,” “Antitrust Guidelines for Collaborations Among Competitors,” and “Horizontal Merger Guidelines.” The Policy Statement on Remedies for SEPs is, therefore, a departure from that established practice.

The DOJ issued the policy statement in its capacity as “the executive-branch agency charged with protecting U.S. consumers by promoting and protecting competition,” and the USPTO in its capacity as “the executive-branch agency charged with responsibility for examining patent applications, issuing patents, and—through the Secretary of Commerce—advising the President on domestic and certain international issues of intellectual property policy.” Policy Statement on Remedies for SEPs at 8.

Noting the procompetitive virtues of consensus-driven standards along with their risks, the Agencies sought to balance the rights of SEP holders against the risk of hold-up to implementers. On the one hand, the Agencies recognized that “[i]n some circumstances, the remedy of an injunction or exclusion order may be inconsistent with the public interest” and “may harm competition and consumers.” Id. at 6. On the other hand, they rejected a general ban on injunctive relief actions for SEPS, see id. at 7-8, or rigid imposition of “one-size-fits-all mandates for royalty-free or below-market licensing, which would undermine the effectiveness of the standardization process and incentives for innovation,” id. at 5-6.

In determining whether an injunction or exclusion order may be appropriate, or otherwise should be denied, the Agencies offered a flexible approach that could be used to adapt the remedy to the specific facts of each case by identifying non-exhaustive “relevant factors when determining whether public interest should prevent the issuance of an exclusion order… or when shaping such a remedy.” Id. at 7-9. One such factor is “whether a patent holder has acknowledged voluntarily through a commitment to license its patents on F/RAND terms that money damages, rather than injunctive or exclusionary relief, is the appropriate remedy for infringement.” Id. at 9.

However, according to the Agencies, “This is not to say that consideration of the public interest factors … would always counsel against the issuance of an exclusion order to address infringement of a F/RAND-encumbered, standards-essential patent”; such an order may still be “an appropriate remedy” in some circumstances. Id. at 7.

For example, an exclusion order by the International Trade Commission (“ITC”) or a district court injunction may be appropriate when “a putative licensee refuses to pay what has been determined to be a F/RAND royalty, or refuses to engage in a negotiation to determine F/RAND terms.” Id. The Agencies also made clear that “a constructive refusal to negotiate” could be the basis for injunctive relief or an exclusion order, such as when the putative licensee “insist[s] on terms clearly outside the bounds of what could reasonably be considered to be F/RAND terms in an attempt to evade the putative licensee’s obligation to fairly compensate the patent holder.” Id. Other factors relevant to a particular case may also justify such a relief, making the inquiry a case-specific one. See id. (noting that “[t]his list is not an exhaustive one,” thus leaving room for other considerations).

In contrast, the FTC has taken a much more restrictive view of SEP inunctions. For example, in its Google order, the FTC generally banned efforts by Google to seek injunctive relief on its SEPs, except in the following narrowly enumerated circumstances against a potential licensee who (a) is outside the jurisdiction of the United States, (b) has stated in writing or sworn testimony that it will not license on any terms, (c) refuses to enter a license on terms determined to be F/RAND in the “Final Ruling” of a court (after exhaustion of all appeals) or through binding arbitration or other mutually-agreed process, or (d) fails to provide a written confirmation to a SEP owner in response to a F/RAND Terms Letter as outlined in the FTC Order. FTC Decision & Order at 7-8. The order also allows Google to seek injunctive relief in certain circumstances when the putative licensee first sues Google for injunctions on the potential licensee’s own SEPs. Id. at 11-12. The order also requires rigid adherence to an offer of a detailed licensing agreement and specific steps for negotiating and resolving disputes before pursuing any injunctive relief consistent with the above conditions. See, e.g., id. at 9-12.

Notably, the FTC order is not based on the antitrust laws, but instead relies on Section 5 of the FTC Act, which is primarily a consumer protection statute that prohibits “unfair method of competition” and “unfair acts or practices.” See FTC Complaint, ¶¶ 31-32. Commissioner Ohlhausen dissented generally questioning the applicability of Section 5 to Google’s conduct and the “doctrinal confusion” the order would cause, among other reasons. See generally Dissenting Statement of Commissioner Ohlhausen. Commissioner Rosch issued a separate statement that called into question the FTC’s use of Section 5’s “unfair method of competition” prong without any “limiting principles” – such as “the requirement that a respondent have monopoly or near-monopoly power” – which risked “unsettl[ing] ‘settled principles of [Sherman Act] Section 2 law’ as defined by the Supreme Court case law under Section 2, … as well as the language of Section 2 itself.” Sep. Stmt. of Commissioner Rosch at 3-4.

[1] All of the relevant documents, including the FTC Complaint, the Decision and Order, and Separate and Dissenting Statements respectively of Commissioners Rosch and Ohlhausen can be found on the FTC’s website at http://www.ftc.gov/os/caselist/1210120/index.shtm.

[2] “F/RAND” refers to a commitment made by a patentee to an industry standard setting organization (“SSO”) that the patentee will license its patents that are, or will become, essential to a standard adopted by the SSO on fair, reasonable, and non-discriminatory terms.

[3] Throughout, “SEPs” is used to refer only to F/RAND-encumbered standard essential patents. These are patents that have been designated as essential to the functionality of an approved standard, such as the telecommunications standards applicable to mobile devices operating on a 3G network, pursuant to the specifications of an SSO.

Copyright © 2013, Sheppard Mullin Richter & Hampton LLP

POSTPONED – Copyright and Trademark Protection in The Digital Age Conference – February 6-7, 2013

THIS CONFERENCE HAS BEEN POSTPONED BY THE ORGANIZER

 

The National Law Review is pleased to bring you information about the upcoming marcus evans Copyright and Trademark Protection in The Digital Age Conference:

Copyright and Trademark Feb 6-7 2013

The marcus evans Copyright and Trademark Protection in The Digital Age Conference will provide strategies for organizations who are dealing with digital copyright and trademark issues, address the management of digital content, digital license agreements, and overall evolution of copyright and trademark to ensure they are protecting their brand.

Copyright and Trademark Protection in The Digital Age Conference – February 6-7, 2013

The National Law Review is pleased to bring you information about the upcoming marcus evans Copyright and Trademark Protection in The Digital Age Conference:

Copyright and Trademark Feb 6-7 2013

The marcus evans Copyright and Trademark Protection in The Digital Age Conference will provide strategies for organizations who are dealing with digital copyright and trademark issues, address the management of digital content, digital license agreements, and overall evolution of copyright and trademark to ensure they are protecting their brand.

Copyright and Trademark Protection in The Digital Age Conference – February 6-7, 2013

The National Law Review is pleased to bring you information about the upcoming marcus evans Copyright and Trademark Protection in The Digital Age Conference:

Copyright and Trademark Feb 6-7 2013

The marcus evans Copyright and Trademark Protection in The Digital Age Conference will provide strategies for organizations who are dealing with digital copyright and trademark issues, address the management of digital content, digital license agreements, and overall evolution of copyright and trademark to ensure they are protecting their brand.

Copyright and Trademark Protection in The Digital Age Conference – February 6-7, 2013

The National Law Review is pleased to bring you information about the upcoming marcus evans Copyright and Trademark Protection in The Digital Age Conference:

Copyright and Trademark Feb 6-7 2013

 

The marcus evans Copyright and Trademark Protection in The Digital Age Conference will provide strategies for organizations who are dealing with digital copyright and trademark issues, address the management of digital content, digital license agreements, and overall evolution of copyright and trademark to ensure they are protecting their brand.

Abandonment and Revival of U.S. Patent Application

The National Law Review recently featured an article, Abandonment and Revival of U.S. Patent Application, written by Ivan T. Kirchev of Michael Best & Friedrich LLP:

 

The power to protect a company’s inventions with patents comes with the responsibility of seeing its patent applications the whole way through the Patent Office, from the initial filing to issuance and beyond.

The filing of a patent application begins a lengthy and sometimes harrowing dialogue with an examiner at the Patent and Trademark Office (PTO) who is responsible for making sure that the application’s invention is truly deserving of patent protection. If (or in reality when) the examiner does not agree that the claimed invention is patentable, the examiner will send the applicant a series of “office actions” rejecting the application or demanding certain amendments to the application. With each office action comes a turn of the hourglass, giving the applicant a definite window of time (usually up to six months) to submit a response. If the applicant’s reply satisfies the examiner, the examiner issues a “notice of allowance,” indicating that the applicant’s invention will be issued as a patent.

However, if the applicant makes a wrong turn during prosecution, the application may become “abandoned” in the eyes of the PTO. When a patent application is abandoned, the patent application is dead and anyone can practice the invention described in the patent application. Once it becomes abandoned, the application requires special petition procedures and payment of fees to revive, if it can be revived at all. If it cannot be revived, the application will never issue as a patent.

An application can become abandoned in one of two ways. First, the applicant fails to respond to a particular PTO notice within a specified time during the prosecution of the application. For example, if the applicant fails to reply to an office action within the specified time period, or files an incomplete reply, or fails to do whatever it is that the examiner has requested before the hourglass runs out, then the application will become abandoned.

Second, a patent application can become abandoned by a formal, express abandonment, requested by the applicant. Express abandonment is not necessarily a bad thing and sometimes is actually a step in the right direction for a company. Because an abandoned unpublished application will never become available to the public, sometimes abandonment may be a strategic decision on the part of the applicant to keep the invention out of the public eye.

When the application becomes abandoned, the applicant will receive a notice from the PTO. At that point, the applicant can either ask for reconsideration if he or she disagrees with the PTO decision, or petition for revival. In order to petition the PTO for revival, the applicant must file a reply that includes; (1) the reply that was originally required before the missed deadline, (2) a statement or showing that abandonment was respectfully either unavoidable or unintentional, and (3) the necessary fee.

If the applicant claims that the abandonment was unavoidable, it must show the PTO that the entire delay in filing the required reply from the due date for the reply, until the filing of a grantable petition pursuant to this paragraph, was unavoidable. “The entire delay” means every single day from the missed deadline to the submission of the petition for revival; the showing must include documentary evidence to support the claim of unavoidability. What qualifies as “unavoidable delay” is determined on a case-by-case basis by the “reasonably prudent person” standard.

Generally, to justify revival on the grounds of unavoidability, an applicant must either show truly dire and uncontrollable circumstances, or reasonable actions that unexpectedly resulted in abandonment. Examples of justifiable unavoidability include the death of the prosecuting patent attorney, the constant moving and financial burden of an application for the medical treatment of cancer, or any reasonable interpretation of a rule. What will not qualify for unavoidable grounds of revival includes miscalculation of the filing deadline, unawareness or misunderstanding of the rules of patent prosecution, or conflicts with personal life. Therefore, businesses should carefully consider their decision to abandon a patent application intentionally (e.g. by deliberately not responding to an office action). Most likely, this type of action will lead to an abandoned application that can never be revived.

If the applicant claims that the abandonment was unintentional, it similarly must state that the entire delay was unintentional. But because a petition claiming unintentional abandonment must merely contain a statement stating as much, rather than a showing, petitions claiming unintentional abandonment are generally less burdensome than claiming unavoidable abandonment. The Manual of Patent Examining Procedure (MPEP) acknowledges as much, stating that the PTO relies on the applicant’s duty of candor and good faith to accept the statement that “the entire delay in filing the required reply from the due date for the reply until the filing of a grantable petition pursuant to 37 CFR 1.137(b) was unintentional” without requiring further information in the vast majority of petitions. Furthermore, the PTO’s reliance on the face value of this statement is enforced by the applicant’s obligation to inquire into the underlying facts and circumstances before providing the statement to the PTO.

However, if the application is revived based on this statement, but then after the patent issues facts arise showing that the statement was false, the entire patent family can be rendered unenforceable on the grounds on inequitable conduct. This situation may arise, for instance, in the discovery of correspondence from the patent attorney to the inventor or the patent examiner indicating an understanding that the patent application will become abandoned, followed by the patent application actually becoming abandoned.

If the application is revived in either case, the applicant must submit a terminal disclaimer to disclaim the length of time that the application was abandoned, and the term of the patent will be shortened accordingly.

Finally, although the America Invents Act (AIA) will impact a variety of patent prosecution issues as it goes into full effect by April of next year, the rules related to abandonment and revival will remain unaffected.

*Also contributing, J. Ryan Lawlis.

© MICHAEL BEST & FRIEDRICH LLP