Category: Intellectual Property

IP Law Summit – September 13-15, 2012

The National Law Review is pleased to bring you information about the upcoming IP Law Summit:

The IP Law Summit will highlight the current challenges and opportunities through visionary conference sessions and keynote presentations delivered by your most esteemed peers and thought leaders from Americas leading corporations. The one-on-one meetings with leading service providers will offer vast expertise in the area of intellectual property law. All this, seamlessly integrated with informal networking opportunities over three days, will provide a unique interactive forum. Do not miss this opportunity to network, establish new connections, exchange ideas and gain knowledge.

FTC Proposes Amendments to HSR Rules Targeting Certain Pharmaceutical Licensing Arrangements

The National Law Review recently published an article by Robert G. Kidwell and Farrah Short of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. regarding Pharmaceutical Licensing:

 

The Federal Trade Commission (FTC) recently announced proposed amendments to the Premerger Notification Rules (HSR Rules) to clarify reporting requirements under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the HSR Act), for transactions involving the transfer of patent rights in the pharmaceutical industry. The proposed rule is largely a codification of the FTC’s current treatment of exclusive licenses, with one significant change regarding the weight given to manufacturing rights retained by the licensor in pharmaceutical transactions.

The HSR Act requires parties engaged in certain transactions (involving the acquisition of voting securities, assets, or controlling non-corporate interests) to file a notification with the FTC and the Antitrust Division of the Department of Justice (DOJ), and to observe the statutorily prescribed waiting period prior to closing. Theacquisition of a patent is treated as an asset acquisition, and thus a potentially reportable transaction under the HSR Act. However, whether the transfer of rightsto a patent is also deemed an asset acquisition commonly involves a complex analysis focused on whether the transferred rights grant the licensee theexclusive right to “make, use and sell.”

Commercially Significant Rights

The proposed amendments would codify the reporting requirement under the HSR Act for any transaction within the pharmaceutical industry that involves the transfer of “all commercially significant rights.” These rights are defined as the exclusive patent rights to use the patent in a particular therapeutic area or in a specific indication within a therapeutic area.

The FTC has defined the pharmaceutical industry for purposes of this amendment by specifying NAICS (North American Industry Classification System) code 3254, which includes medical and botanical manufacturing, pharmaceutical preparation manufacturing, in-vitro diagnostic substance manufacturing, and biological product manufacturing. Importantly, the FTC’s proposed amendments are limited to the pharmaceutical industry and do not change the current HSR Act reporting requirements related to exclusive licenses in other industries.

Retained Manufacturing Rights

Under current FTC practice, transactions where the licensor retains the right tomanufacture are generally deemed non-exclusive and thus non-reportable under the HSR Act, even if the licensee obtains exclusive rights to use and sell under the patent. These transactions historically have been viewed as distribution agreements, rather than asset acquisitions.

The FTC, however, has determined that the right to manufacture in pharmaceutical licensing arrangements is far less important than the right to commercialize (use and sell) the product. Therefore, the FTC’s proposed amendment treats these types of exclusive arrangements in the pharmaceutical industry — where the licensee obtains the exclusive right to use and sell but the licensor retains the right to manufacture — as the transfer of “all commercially significant rights” and thus potentially reportable under the HSR Act. This change would represent a significant departure from the FTC’s current practice.

Retained “Co-Rights”

In certain licensing arrangements, the licensor often retains “co-rights” when granting an otherwise exclusive license. For example, in the pharmaceutical industry, co-rights provide for the shared responsibility between the licensor and the licensee to see the licensed product through the Food and Drug Administration (FDA) approval process, and the subsequent marketing and promotion of the product (often referred to as “co-development” and “co-marketing” rights). Under current FTC practice, the retention of these co-rights by the licensor does not render the license non-exclusive, therefore they remain potentially reportable licensing arrangements under the HSR Act. The proposed amendments would simply codify this approach without making any change to current practice.

The proposed amendments would modify the HSR Rules contained in 16 C.F.R. §801.1 and §801.2. Click here for the text of the Federal Register Notice, and the full language of the proposed amendments. Comments regarding the proposed amendment must be submitted to the FTC by October 25, 2012.

©1994-2012 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

Almost All Applications Filed On or After September 16, 2012 Will Require a New Inventor’s Declaration

On Tuesday, August 14, 2012, the United States Patent and Trademark Office (USPTO) published a final rule entitled “Changes to Implement the Inventor’s Oath or Declaration Provisions of the Leahy–Smith America Invents Act.” Among other things, this rulemaking implements 35 USC 115, which changed the requirements for the inventor’s oath or declaration. Amended 35 USC 115(b) provides that the oath or declaration must contain two statements: (1) that the application was made or was authorized to be made by the affiant or declarant, and (2) that the individual believes himself or herself to be the original inventor or an original joint inventor of a claimed invention in the application. All oaths or declarations submitted in an application filed on or after September 16, 2012 must meet the requirements of 35 USC 115 as amended by the AIA.

The phrase “or was authorized to be made” is new and does not appear in the current version of the inventor’s declaration. As a result, oaths or declarations submitted in applications filed before September 16, 2012 will not satisfy the statutory requirements for an oath or declaration for an application filed on or after September 16, 2012.

This is especially significant for continuing applications: continuations, divisionals, and continuation-in-part applications. Previously, applicants could submit a copy of the inventor’s oath or declaration from a parent application for a continuation or divisional application of that parent application. However, according to this final rule, starting September 16, 2012, this will no longer be possible if the current oath or declaration does not contain the new statements as above. The oath or declaration that is submitted for a continuing application that was filed on or after September 16, 2012, must satisfy the amended AIA statute. As a result most applications will need a new oath or declaration.

Adding to the problem, the USPTO will no longer review an oath or declaration in an application for compliance with the rules during the examination process. The USPTO will review applications to determine whether the application includes an oath or declaration when the application is in condition for allowance. Therefore it could be many years before the applicant learns that the oath or declaration is defective.

RECOMMENDATION: File continuing applications, continuations, divisionals, and continuation-in-part applications prior to September 16, 2012, if obtaining a new oath or declaration with the signature of the inventors may be a problem. Contact your attorney for other options.

© 2012 Sterne Kessler

New Global Initiatives to Accelerate Examination of Cleantech Patent Applications

An article regarding Global Initiatives of Cleantech Patents written by Peter A. Jackman and Lori M. Brandes, Ph.D. of Sterne, Kessler, Goldstein & Fox P.L.L.C. appeared recently in The National Law Review:

In an effort to promote the development and commercialization of technologies that conserve natural resources or reduce negative environmental impact, patent offices around the world have adopted programs to expedite the examination of patent applications pertaining to clean technologies.

AUSTRALIA

On September 15, 2009, IP Australia announced a fast-track examination program for patent applications directed to environmentally friendly technologies.  Examination of applications under the program is expected to begin within four to eight weeks after filing the request for expedited examination and no additional fee is required.

BRAZIL

The National Institute of Industrial Property (INPI) launched a program on April 17, 2012 to accelerate the patenting of green technologies in alternative energy, transportation, energy conservation, waste management, and agriculture.  The goal of the program is to reduce the average prosecution time of an application from over five years to less than two years.  The program is limited to the first 500 petitions granted and to applications originally filed on or after January 2, 2011 in the INPI or filed as a Paris Convention application in the INPI within one year of a priority application.

CANADA

The Canadian Intellectual Property Office issued an initiative on March 3, 2011 to accelerate the examination of patent applications pertaining to green technology.  Under the initiative, a patent applicant can request accelerated examination by submitting a declaration stating that the application relates to a technology that could help to resolve or mitigate environmental impacts or conserve the natural environment and resources if commercialized, with no additional fee required.

CHINA

Effective August 1, 2012, prioritized examination of applications relating to energy conservation, environmental protection, or green technologies will be available in China.  Applicants must submit a search report by a qualified entity or a translation of a search report issued by another country. Once a request for prioritized examination is granted, a first office action is expected to issue within 30 days and prioritized examination is expected to be completed within one year.

ISRAEL

A new category of applications that could receive priority examination was created for “green patents” by the Israel Patent Office on December 27, 2009.  To request priority examination, the applicant must provide an explanation as to why the invention helps advance environmental protection; however, the declaration and extra fees normally required for priority examination are not required. After qualifying under the program, these “green” patent applications will be examined within three months.

JAPAN

On November 1, 2009, the Japanese Patent Office implemented a program allowing for the accelerated examination of “green inventions” having a beneficial effect on the environment through low energy consumption or reduction of carbon dioxide emissions. Under the program, an applicant can receive a first office action in about two months.

SOUTH KOREA

The Korean Intellectual Property Office launched a fast-track examination program on October 1, 2009 for patent applications related to certain categories of green technologies.  Under this program, an applicant must submit results of a prior art search along with a request for fast-track examination, and a first office action will be issued within one month of the request.

UNITED KINGDOM

On May 12, 2009, the United Kingdom Intellectual Property Office created a “Green Channel” program whereby an applicant can request accelerated processing of an application by indicating (1) that the invention relates to a “green” or environmentally friendly technology, and (2) which actions the applicant wishes to accelerate (i.e., search, combined search and examination, publication, and/ or examination).  The program applies to existing applications and applications filed after May 12, 2009.  A searchable public database of published applications in the Green Channel program is available.  As of August 3, 2012, the database contains over 500 applications.

UNITED STATES

The Green Technology Pilot Program for expediting examination of clean technology applications closed earlier this year, with over 1,050 patents issued under the program.  However, other accelerated examination options applicable to all technologies are still available for clean technology applications. These options include the U.S. Patent and Trademark Office’s (USPTO’s) Prioritized Examination Program (Track I), the Patent Prosecution Highway, the Accelerated Examination Program, and a Petition based on Applicant’s Age or Health.  Under the Track I program, an application is advanced out of turn for examination upon payment of a $4,800 petition fee, reduced by 50% for qualifying small entity applicants. The USPTO’s goal is to provide a final disposition of a Track I application within 12 months of prioritized status being granted. A maximum of 10,000 requests will be granted  under Track I per fiscal year, and approximately 3,000 have been granted so far in fiscal year 2012.  The average pendency of a Track I application from the grant of a Track I request to the issuance of a first office action on the merits is approximately 1.5 months, and the average pendency from the grant of a Track I request to a final disposition of the application is approximately 5 months.

In view of the numerous international opportunities for accelerated examination and the growing importance of clean technologies, patent applicants should carefully consider these expedited options as part of a global IP strategy to patent their environmental innovations and bring them quickly to market.

© 2012 Sterne Kessler

A Sticky Situation—Secondary Considerations Require NEXUS to the Claimed Invention

Addressing issues of invalidity and non-infringement of patents asserted between direct competitors in the chewing gum market, the U.S. Court of Appeals for the Federal Circuit explained that in order to be entitled to rely on evidence of unexpected results commercial success or copying, the evidence of secondary translations must be tied to the claimed invention, i.e., the so-called nexus requirement. WM Wrigley Jr. Co. v. Cadbury Adams USA LLC, Case Nos. 2011-1140, 1150 (Fed. Cir., June 22, 2012) (Bryson, J.) (Newman, J. concurring-in-part and dissenting-in-part).

Wrigley and Cadbury cross-alleged patent infringement of patents directed to chewing gum that provides a cooling sensation when chewed.  The Wrigley patent was directed to chewing gum containing a combination of menthol and WS-23 coolant, while the Cadbury patent was directed to a chewing gum containing a combination of menthol and WS-3 coolant.

The district court found that one claim of Wrigley’s patent was invalid as anticipated by a patent to Shahidi and another was invalid as obvious in view of a patent to Luo and a publication by Parrish.  The lower court rejected Wrigley’s evidence of unexpected results, commercial success and copying.  The district court also found that Cadbury’s patent was not infringed, either literally or under the doctrine of equivalents.  Wrigley appealed.

The Federal Circuit affirmed the lower court’s finding of obviousness as to Wrigley’s patent, concluding that Wrigley failed to demonstrate that the combination of menthol and WS-23, as claimed, resulted in an unexpected benefit beyond what was already known in the art.  The Court stated that prior art teaches that the combination of menthol and WS-3 yields “enhanced breath freshening effects” and that it was known that WS-3 and WS-23 share similar characteristics.  The Federal Circuit dismissed Wrigley’s evidence of unexpected results because there was no clear showing that the claimed invention resulted in the alleged unexpected benefits that were attributable to the claimed components and not to other factors, including sweetener levels, higher gum base and filler levels and more expensive ingredients.  Likewise, the Court dismissed Wrigley’s evidence of commercial success and copying for a lack of a nexus to the claimed invention.

The Federal Circuit also affirmed the lower court’s finding of anticipation based on Shahidi. The Federal Circuit found that Shahidi disclosed a number of different combinations of cooling and flavoring agents, one of which was the claimed combination of menthol, which Shahidi identified as one of the most suitable flavoring agents, and WS-23, which Shahidi listed among a group of other flavoring agents.

Regarding Cadbury’s patent, the Federal Circuit found that Cadbury could not prove infringement under the doctrine of equivalents because it had chosen to limit its claimed chewing gum composition to a certain species and not to the broader genus, despite knowing at the time of filing its application that WS-23 and WS-3 were interchangeable.  Cadbury’s decision to narrowly recite claim N-substituted-p-menthane carboxamides, which excludes WS-23, was detrimental to its infringement case.

In her dissent, Judge Newman pointed out that Shahidi, the purportedly anticipatory reference, “does not show the claimed combination at all, but merely presents the ingredients on lists” which can be combined in more than a million possible combinations.  Judge Newman also disagreed with the majority’s finding on obviousness, stating the record was “rife” with evidence demonstrating a nexus between Wrigley’s success of chewing gum combinations with menthol and WS-23, including Cadbury’s own internal records and marketing materials stressing the cooling effect of its reformulated chewing gum.

© 2012 McDermott Will & Emery

IP Law Summit – September 13-15, 2012

The National Law Review is pleased to bring you information about the upcoming IP Law Summit:

The IP Law Summit will highlight the current challenges and opportunities through visionary conference sessions and keynote presentations delivered by your most esteemed peers and thought leaders from Americas leading corporations. The one-on-one meetings with leading service providers will offer vast expertise in the area of intellectual property law. All this, seamlessly integrated with informal networking opportunities over three days, will provide a unique interactive forum. Do not miss this opportunity to network, establish new connections, exchange ideas and gain knowledge.

IP Law Summit – September 13-15, 2012

The National Law Review is pleased to bring you information about the upcoming IP Law Summit:

The IP Law Summit will highlight the current challenges and opportunities through visionary conference sessions and keynote presentations delivered by your most esteemed peers and thought leaders from Americas leading corporations. The one-on-one meetings with leading service providers will offer vast expertise in the area of intellectual property law. All this, seamlessly integrated with informal networking opportunities over three days, will provide a unique interactive forum. Do not miss this opportunity to network, establish new connections, exchange ideas and gain knowledge.

Advertising and Marketing Law Alert – Pinterest Gets Stuck With Disclosure Requirements

Recently The National Law Review published an article by Joan L. Long of Barnes & Thornburg LLP regarding Pinterest:

“Pinning” on the popular website Pinterest may amount to unlawful consumer endorsement or testimonial

Consumer endorsements and testimonials have recently garnered a lot of attention from the National Advertising Division (NAD) and Federal Trade Commission (FTC). There has been a renewed interest in assuring that advertisements containing an endorsement or testimonial are truthful and not misleading, that if an advertiser does not have proof that an endorser’s experience represents what consumers will achieve when using the product the ad must clearly and conspicuously disclose the general expected results in the depicted circumstances, and, if there’s a connection between the endorser and the marketer of the product that would affect how people evaluate the endorsement, that connection should be disclosed.

Social media websites certainly do not receive special treatment from the NAD or FTC when it comes to consumer opinion regarding products and services. This is especially true for advertisers of dietary and nutritional products. Testimonials claiming specific results usually will be interpreted to mean that the endorser’s experience is what others can expect. Statements like “Results not typical” or “Individual results may vary” won’t change that interpretation. If the results are not typical, an advertiser must clearly and conspicuously disclose the generally expected performance in the circumstances shown in the ad.

Recently NAD issued a decision regarding the newly popular website Pinterest. Pinterest is a virtual bulletin board, often described as a social photo-sharing website where users create and manage theme-based image collections by “pinning” digital content they find on the web to their personal boards. NAD began following Nutrisystem, Inc.’s weight-loss success stories pinned to such boards. These stories had express claims regarding consumer’s weight loss success, including the consumer’s name, total weight loss, and a link to the Nutrisystem website.

Testimonials which tout atypical results must be qualified by a clear and conspicuous disclosure noting the results the consumer can generally expect to achieve using the product in the circumstances depicted. Such disclosures should appear close in proximity to the claims they are intended to qualify. NAD found that it was undisputed that these pins represented consumer testimonials, and, as such, these pins should be accompanied by a clear and conspicuous disclosure noting the typical results consumers can expect to achieve using the Nutrisystem weight loss program.

Companies need to be aware that both NAD and the FTC closely scrutinize social media sites, such as Pinterest, Facebook, and Twitter. As social media websites become more sophisticated and allow for consumers to become increasingly intertwined with a company’s advertising message, companies need to have reasonable programs in place to monitor and inform members of their network of what can and cannot be said about products or services.

© 2012 BARNES & THORNBURG LLP

IP Law Summit – September 13-15, 2012

The National Law Review is pleased to bring you information about the upcoming IP Law Summit:

 

The IP Law Summit will highlight the current challenges and opportunities through visionary conference sessions and keynote presentations delivered by your most esteemed peers and thought leaders from Americas leading corporations. The one-on-one meetings with leading service providers will offer vast expertise in the area of intellectual property law. All this, seamlessly integrated with informal networking opportunities over three days, will provide a unique interactive forum. Do not miss this opportunity to network, establish new connections, exchange ideas and gain knowledge.

In Effort to Extradite UK Man in Piracy Case, DOJ Is Overreaching

The National Law Review recently published an article by Sarah Coffey of Ifrah Law regarding Copyright Piracy:

 

 

A current anti-piracy case demonstrates the U.S. government’s intent to enforce its copyright laws not just beyond national borders, but beyond the extent of logic. The U.S. Department of Justice has issued an arrest warrant and extradition order for a 24-year-old college student in England who ran a website that contained links to independent websites that hosted pirated television shows and movies. By holding a mere intermediary accountable for allegedly pirated content offered on other websites, the department has set an alarming precedent with major free speech implications.

Richard O’Dwyer, who has never left the United Kingdom, is at the center of a heated debate regarding U.S. laws related to copyright, free speech, and jurisdiction. O’Dwyer ‘s website, TvShack.net, is registered in the United States, thereby giving the U.S. government a claim to exert jurisdiction over it and its owner even though the servers hosting the website are not U.S.-based. The website allowed users to search for and link to other websites; the government alleges that some of those links led to pirated movies and television shows. The government seized the domain on June 30, 2010, for “violations of federal criminal copyright infringement laws.” O’Dwyer has been charged with conspiracy to commit copyright infringement and criminal infringement of copyright.

The government’s case against O’Dwyer raises a number of important issues. First, O’Dwyer himself did not host the allegedly infringing material. His website allowed users to run searches that returned links to both legal and allegedly illegal content on external websites. If O’Dwyer can be criminally prosecuted for the dissemination of copyrighted content that he did not host, where would the chain of liability for such content end? Would search engines linking to such websites bear responsibility for their content? Would anyone sending a link to that website face criminal prosecution, even someone who actually download or view the content? There is no telling how far the DOJ intends to push this issue, but O’Dwyer’s case is a good indication that the DOJ seeks to extend the limits as far as the courts will allow.

O’Dwyer’s status as a British subject raises less novel but no less compelling questions about the United States’ jurisdiction to extradite and prosecute individuals on copyright infringement charges. O’Dwyer’s extradition has been approved by the British courts as well as the British home secretary, but many still believe that any trial should take place in Britain since O’Dwyer has never set foot in the United States and the servers hosting the website were also not on our shores.

O’Dwyer is currently appealing the extradition. Last month, Wikipedia founder Jimmy Wales, in a rare political intervention, called upon British Home Secretary Theresa May to stop the extradition efforts.

The circumstances of this case are reminiscent of the high-profile Megaupload case, in which the U.S. government issued an extradition order for Kim Dotcom in New Zealand. Dotcom ran an internet “lockbox,” in which users could upload content, including video and music, to a website and then share access with other users. Factually, these cases differ in that Megaupload hosted the content that was uploaded by users, whereas O’Dwyer only provided links to other websites. New Zealand also appears less willing to approve extradition, having pushed a hearing on the matter to March 2013, while Dotcom remains free on bail.

In instances of intermediary liability, the need to protect copyrighted works is outweighed by an individual’s interest in remaining free from criminal prosecution for the acts of another. The remedy, if one is justified, is better addressed through civil penalties rather than criminal prosecution.

© 2012 Ifrah PLLC