Category: Technology

Top Ten Intellectual Property Stories from 2013

Schwegman Lundberg Woessner

 

I admit it, I like lists, even completely subjective ones like this one, that is tilted toward patent law and prep/pros. So in no particular order, except for number one, here we go:

top 10 2013 intellectual property patent

  1.  Myriad [Add your pun title here!]. No story can top a unanimous Supreme Court opinion (Thomas writing even!) holding that a discrete chemical molecule is really a data storage device made for us all by Mother Nature, and so is a “natural product”. More troubling, I fear, are Judge Lourie’s two opinions below, holding that the broadly-claimed diagnostic methods were patent-ineligible as “abstract ideas.” Combine this with Mayo and PerkinElmer v. Intema and you get caught in a perfect storm that can sink almost any claim to a diagnostic method.
  2. CLS Bank v. Alice. A big story indeed, as commentators tried, with little success, to unravel the threads in multiple opinions issued by the Fed. Cir. judges. Now the Supreme Court will try to define an abstract idea. Is C =pi(D) carved into a brick concrete enough for you?
  3. Inequitable Conduct goes into IP hospice. While we still have a duty of candor and good faith in dealing with the PTO, Rule 1.56(b) is gone. A simple failure to submit even “material” information will seldom, if ever, lead to an IC holding. In 1st Media v Electronic Arts, Sony, a defendant in the suit, petitioned for cert., playing the “rigid test” card, but the Supreme Court stood pat and denied the petition. In Network Signatures v. State Farm, Judge Newman suggested that facially false petitions would not amount to “egregious misconduct” unless they involved statutory standards of patentability, as opposed to formal PTO filings. However, the Supreme Court also denied cert.  in Apotex v. Cephalon, in which the Cephalon attorney and scientist obtained a patent on an invention made by their supplier – both the D.C. and the Fed. Cir found IC. And where are the final PTO rules?
  4. The rise of the Written Description Requirement as a patent-killer. I predicted this trend post-Ariad and the Fed. Cir. has ruled accordingly. It is much easier to invalidate a claim by finding that the specification does not demonstrate enough “possession” of the claimed invention that it is to have to sort through all those messy Wands factors for enablement. Even with a lot of structural data, Novozymes’ patent on its improved enzyme sank like a stone. And the Fed. Cir. has pretty much ignored patentee’s attempts to argue that a thin disclosure can be supplemented by information available to the art. See Wyeth v. Abbott Labs. Even “Gentry Gallery” –based decisions seem to be in vogue again (no support in specification for later claim amendment) – see Synthes v. Spinal Kinetics. However, possession did “rule” in Sanofi-Aventis v. Pfizer, so perhaps it is possible to turn this ocean liner around.
  5. Section 112(b) Indefiniteness. Supreme Court may grant cert to resolve the question: “Does the Federal Circuit’s acceptance of ambiguous patent claims with multiple reasonable interpretations—so long as the ambiguity is not ‘insoluble’ by a court—defeat the statutory requirement of particular and distinct patent claiming.” Nautilus v Biosig Instruments. This is one of the few lines of Fed. Cir. decisions that favor patentees.
  6. Who induced infringement, or did they? In Limelight Networks v. Akami Techs., the Supreme Court may well grant cert. to decide the question: “Whether the Fed. Cir. erred in holding that a defendant may be held liable for inducing patent infringement under [271(b)] even though no one has committed direct infringement under [271(a)]?” This somewhat muddled question could be clearer if “no one” was defined more completely, but the Solicitor General has recommended that the Court take this one up, so watch out.
  7. The Rise of Secondary Considerations. In the wake of KSR’s termination of the teaching-suggestion-motivation test, the Fed. Cir. and the Board are increasingly looking for, and giving weight to, the oft neglected bag of secondary considerations. The court has noted that unexpected results are a secondary consideration (I don’t think that John Deere said that), and has put increased emphasis on long-felt need, failure of others, commercial success and the like. This does not mean that applicants or patentees will always “win”, but it significantly increases the number of patentability “chips” they have to play. For example, see Galderma v Tolmar, Appeal No. 2013-1034 ( Fed. Cir., December 11, 2013)in which a split panel of the Fed. Cir. found Galderma’s add-on patent for adapalene obvious, but spent a lot of space evaluating unexpected results and defining “teaching away.”
  8. Has Cybor’s Time Finally Come? The Fed. Cir. en banc will soon decide whether or not Fed. Cir. panels should overrule its practice of reviewing claim construction de novo, as a matter of law. Cybor has been much reviled in recent years, but there are voices that feel Cybor comports with the mission of the Fed. Cir. to bring uniformity to patent law. If the court takes this step, some commentators think that the Supreme Court will be the final arbiter.
  9. Stem Cell Research to Continue. The suit seeking to ban Federal funding for embryonic stem cell research was finally dismissed.
  10. The Battle Against “Patent Trolls” continues. And continues to threaten a system that has worked to advance innovation for over 200 years. The biggest threat posed by attempts to limit suits by NPE’s against – mostly – high tech communications companies is that they tar patent holders as a group, particularly universities and individual inventors and start-ups, by making it more difficult/costly for them to enforce their patent rights against deep pocket infringers. H.R. 3309 is just one of the latest shotgun blasts fired at the patent system. Now the Office may have a new “Director” who believes that the patent system is broken and needs to be fixed. I don’t like legislative and administrative bodies cooperating to fix a problem that almost no one has clearly defined. The last time this happened, there was a bill passed to reduce the backlog by severely limiting application filing and prosecution in general.

Merry holidays (or year-end rushes) to us all and many happy allowances!

Article by:

Warren Woessner

Of:

Schwegman, Lundberg & Woessner, P.A.

New Online Privacy Policy Requirements Take Effect January 1, 2014

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California Online Privacy Protection Act (CalOPPA)

Owners of websites, online services or mobile applications (apps) that can be accessed or used by California residents should ensure their compliance with the new amendments to the California Online Privacy Protection Act of 2003 (CalOPPA) by the law’s January 1, 2014 effective date.  The borderless nature of the Internet makes this law applicable to almost every website or online service and mobile application.  Accordingly, companies should review and revise their online privacy policies to ensure compliance with the new law and avoid potentially significant penalties.

Previously, CalOPPA required the owner of any website or online service operated for commercial purposes (an “operator”) that collects California residents’ personally identifiable information (PII) to conspicuously post a privacy policy that met certain content requirements, including identifying the types of PII collected and the categories of third parties with whom that information is shared. The new law requires that companies subject to CalOPPA provide the following additional disclosures in their privacy policies.

  • How an operator responds to “do not track” signals from Internet browsers and any other mechanism that provides consumers a choice regarding the collection of PII about an individual consumer’s online activities over time and across third-party websites and online services.  A company may satisfy this requirement by revising its privacy policy to include the new disclosures or by providing a clear and conspicuous hyperlink to a webpage that contains a description of any program or protocol the company follows to provide consumers a choice about tracking, including the effects of the consumer’s choice.
  • An affected company must disclose to users whether third parties may collect PII about a user’s online activities over time and across different websites when a consumer uses the operator’s website or online service. However, an operator is not required to disclose the identities of such third parties.

The California law does not require that operators honor a user’s “do not track” signals. Instead, operators must only provide users with a disclosure about how the website or mobile app will respond to such mechanisms. “Do not track” mechanisms are typically small pieces of code, similar to cookies, that signal to websites or mobile apps that the user does not want his or her website or app activities tracked by the operator, including through analytics tools, advertising networks, and other types of data collection and tracking practices.  Further, the Privacy Enforcement and Protection Unit of the California Office of the Attorney General recently stated that the required disclosures should not be limited to tracking simply for online behavioral advertising purposes, but those disclosures must extend to any other purpose for which online behavioral data is collected by a business’s website (e.g., market research, website analytics, website operations, fraud detection and prevention, or security).

A violation of the law can result in a civil fine of up to $2,500 per incident. The California Attorney General maintains that each noncompliant mobile app download constitutes a single violation and that each download may trigger a fine.

Given that most company websites will have California visitors, companies should consider taking the following steps to ensure compliance with the CalOPPA amendments by January 1, 2014:

  • Identify the tracking mechanisms in place on your company’s websites and online services, including (a) the specific types of PII collected by the tracking mechanism and (b) whether users have the option to control whether and how the mechanisms are used and how the website responses responds to “do not track” signals by seeking input from those familiar with your website, including (i) technicians and developers who understand the mechanics of how the website operates, including how it responds to “do not track signals,” (ii) financial and marketing personnel who understand how user PII is monetized, and (iii) any other stakeholders who access or handle user PII.
  •  Review the practices of any third parties that have the ability to track users on your website. To draft the new disclosures, you will need to understand how those third parties track your users and whether they are capable of doing so before or after the users leave your service.
  • Incorporate the information identified above to modify your online privacy policy to include the required behavioral tracking disclosures.
  • Retain the prior version of the policy in your records, including the date on which each version was posted to the site. The new version should have an updated effective date to distinguish it from the previous version.

Expansion of California’s Data Breach Notification Requirements

Under another new law taking effect on January 1, 2014, California will expand its data breach notification requirements by adding new types of information to the definition of “personal information” under California Civil Code §§ 1798.29 and 1798.82. The new law requires notification if a California resident’s personal information is compromised, and, as with CalOPPA, the breach notification requirements apply regardless of the location of the organization that sustains the breach.  Therefore, to the extent that your business collects and retains California residents’ PII, then the amended California breach notification law would apply.

Previously, the California law required notification of a data breach in the event of the unauthorized access to or disclosure of an individual’s name, in combination with that individual’s (i) Social Security number, (ii) driver’s license or California ID number, (iii) account, credit or debit card number, together with a security or access code, (iv) medical information, or (v) health information, where either the name or the other piece of information was not encrypted. Under the new definition, “personal information” will also include “[a] user name or email address, in combination with a password or security question and answer that would permit access to an online account.”

Accordingly, if your business or organization collects this type of information, then it should consider undertaking the following proactive measures to reduce the risk and magnitude of a potential data breach:

  • Periodically and systematically delete nonessential personal information. By deleting obsolete PII and other sensitive information, businesses can significantly reduce the risk of a breach.  Retaining such obsolete legacy PII serves no business purpose, but only adds unnecessary exposure and potential liability.
  • Conduct a PII inventory and perform a risk assessment of your security measures.  Identify what PII is being collected by your organization, where it is retained, who has access to the PII and  the security measures to protect the PII.  Ensuring that sufficient protections are in place may not prevent every incident, but they can reduce the possibility of an incident occurring in the first place and limit the disruption to your business if there is a breach.
  • Limit the disclosure of PII to third parties only when necessary to provide services or products. You can be equally responsible for a data breach notification if the person or entity who experiences the data breach was a third party who received PII from you. Any vendor or third party with whom you share PII should contractually represent and warrant that they have in place certain standards for protecting that information and agree to indemnify your company for any loss that results from a breach.

 

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Vedder Price

New Grants to Help More Students Pursue STEM (Science, Technology, Engineering, Math) Careers

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Tonight, I’m announcing a new challenge to redesign America’s high schools so they better equip graduates for the demands of a high-tech economy. And we’ll reward schools that develop new partnerships with colleges and employers, and create classes that focus on science, technology, engineering and math – the skills today’s employers are looking for to fill the jobs that are there right now and will be there in the future. President Obama, 2013 State of the Union

In November 2013, President Obama announced a new $100 million competition launched by the U.S. Department of Labor to help American high schools prepare students for college and for careers in a 21st-century economy.

Computer Science Education Week is a perfect time to highlight this new administration effort — called Youth CareerConnect — to inspire and prepare girls and boys in communities across the country to be the designers, programmers, engineers, and innovators of the future through increasing their access to hands-on, real-world-relevant education and skills.

Through Youth CareerConnect, up to 40 grants will be awarded to partnerships between local schools systems, employers, community colleges or universities, and others that are committed to strengthening America’s talent pipeline and providing students with industry-relevant education to prepare them for college and careers.

Schools and their partners will be challenged to focus on addressing key shortages in “H-1B fields” — occupations tied to the H1-B temporary-visa program, which are predominantly in science, technology, engineering and mathematics.

This is an exciting investment that will prepare more American students to be the innovators, researchers, engineers, and entrepreneurs of the future. This initiative also, in part, answers a call by the President’s Council of Advisors on Science and Technology in its 2010 report on STEM K-12 Education, Prepare and Inspire, to increase the number of STEM-focused schools across the country.

Applicants will be judged on their efforts to serve a diverse student population, which will ensure access to preparation and training in the STEM fields for girls and minority groups currently underrepresented in many of these careers.

Importantly, the competition builds on the strong focus of OSTP and the White House Council on Women and Girls on increasing girls’ access to STEM fields and represents an important investment to both level the playing field for women and minority students and to provide them with the inspiration, access to career models, hands-on experiences, and rigorous curricula to prepare them to become the engineers, computer scientists and other STEM leaders of the future.

Success in this competition and meeting the broader challenge of giving all students access to real-world-relevant education experiences will require an all-hands-on-deck effort. That’s why Youth CareerConnect calls on businesses and institutions of higher education to join with school districts in putting together proposals to improve college and career readiness for more high school students.

Applications are due Jan. 27, 2014, so learn more at:  http://www.doleta.gov/ycc/

By Danielle Carnival and Kumar Garg.

Editor’s note: The following has been cross-posted from the WhiteHouse.gov blog. 

Danielle Carnival is a senior policy advisor and Kumar Garg is the assistant director for learning and innovation at the White House Office of Science and Technology Policy. 

 

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U.S. Department of Labor

Supreme Court to Consider Case on Patent Eligibility of Computer-Implemented Inventions

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On December 6, 2013, the Supreme Court agreed to consider Alice Corp. v. CLS Bank International, a case concerning the patent eligibility of computer-implemented inventions. The Court will review a split decision issued by the en banc Federal Circuit in May 2013. In that decision, seven of 10 judges concluded Alice Corporation’s claims to computer-based methods for minimizing settlement risk in financial transactions, as well as claims to computer-readable media containing program code for performing such methods, constituted patent-ineligible subject matter under § 101. The judges split evenly, however, regarding the patent eligibility of Alice’s remaining claims to computerized systems for performing such transactions. Given the stark differences of opinion expressed by members of the Federal Circuit, it was widely predicted that the Supreme Court would step in to settle the dispute. The Court’s decision could have significant implications for the computer hardware and software industries, as well as for patent eligibility standards in general.

The Supreme Court is expected to hear arguments in early 2014, and a decision is expected by the end of the term in June 2014. The case number is 13-298.

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Michael Best & Friedrich LLP