Fitch Even News Feed Apr 2020 00:00:00 -0800firmwise Alert: USPTO Extends Select Trademark-Related Timing Deadlines Under the CARES Act<p>On March 31, the USPTO <a href="">announced</a> extensions to the time allowed to file certain trademark-related documents and to pay certain required fees that would have been due on or after March 27, 2020. This action was made in accordance with the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was enacted in response to the COVID-19 pandemic.</p> <p>Specifically, the provisions of the CARES Act allow for the USPTO to toll, waive, adjust, or modify deadlines proscribed by the Trademark Act. This is a significant development because the USPTO has always been unable to modify due dates that are established by statute. The Director of the USPTO has determined that the national emergency created by the COVID-19 pandemic in the U.S. has prejudiced the rights of applicants, registrants, trademark owners and others in trademark matters before the USPTO as well as significantly disrupting the operations of the businesses and law firms that appear before the USPTO. As a result, the director has established a selection of due dates entitled to relief.</p> <p>For the period beginning March 27, 2020, and extending through April 30, 2020, certain due dates can be extended by 30 days from the initial due date, as long as the filing is accompanied by a statement (provided below) that the delay in filing or payment was due to the COVID-19 outbreak. The due dates subject to this extension follow:</p> <ul> <li>Response to an office action, including a notice of appeal from a final refusal, under 15 U.S.C. &sect; 1062(b) and 37 C.F.R. &sect;&sect; 2.62(a) and 2.141(a)</li> <li>Statement of use or request for extension of time to file a statement of use under 15 U.S.C. &sect; 1051(d) and 37 C.F.R. &sect;&sect; 2.88(a) and 2.89(a)</li> <li>Notice of opposition or request for extension of time to file a notice of opposition under 15 U.S.C. &sect; 1063(a) and 37 C.F.R. &sect;&sect; 2.101(c) and &sect; 2.102(a)</li> <li>Priority filing basis under 15 U.S.C. &sect; 1126(d)(l) and 37 C.F.R. &sect; 2.34(a)(4)(i)</li> <li>Priority filing basis under 15 U.S.C. &sect; 1141g and 37 C.F.R. &sect; 7.27(c)</li> <li>Transformation of an extension of protection to the United States into a U.S. application under 15 U.S.C. &sect; 1141j(c) and 37 C.F.R. &sect; 7.31(a)</li> <li>Affidavit of use or excusable nonuse under 15 U.S.C. &sect; 1058(a) and 37 C.F.R. &sect; 2.160(a)</li> <li>Renewal application under 15 U.S.C. &sect; 1059(a) and 37 C.F.R. &sect; 2.182</li> <li>Affidavit of use or excusable nonuse under 15 U.S.C. &sect; 1141k(a) and 37 C.F.R. &sect; 7.36(b)</li> </ul> <p>In order to obtain the benefit of the 30-day extension afforded by this order, the filing must include this statement:</p> <p style="margin-left: 40px;">A delay in filing or payment is due to the COVID-19 outbreak for the purposes of this notice if a practitioner, applicant, patent owner, petitioner, third party requester, inventor, or other person associated with the filing or fee was personally affected by the COVID-19 outbreak, including, without limitation, through office closures, cash flow interruptions, inaccessibility of files or other materials, travel delays, personal or family illness, or similar circumstances, such that the outbreak materially interfered with timely filing or payment.</p> <p>For all other situations where the COVID-19 outbreak has prevented or interfered with a filing before the Trademark Trial and Appeal Board, a request (in <i>ex parte</i> appeals) or motion (for trial cases) for an extension or reopening of time, as appropriate, can be made.</p> <p>For more information on this development, please contact Fitch Even partner <a href=";A=2609&amp;format=xml&amp;p=5482">Joseph T. Nabor</a>, author of this alert.<br /> <br /> <b>Fitch Even IP Alert<sup>&reg;</sup></b></p>IP Alerts03 Apr 2020 00:00:00 -0800 Alert: Copyright Office Proceeds with Implementation of Fee Increases as Scheduled<p>Effective March 20, 2020, the Copyright Office <a href="">has increased filing fees</a> for most of its services, including registering claims to copyright, recording documents, and searching copyright records. The Office adopted the increase in fees as part of a statutory requirement that it conduct a study to evaluate the actual cost of providing its fee-based services and its work processes.</p> <p>The Office&rsquo;s mandated evaluation occurs every three to five years with the intent of recovering a substantial portion of the costs to the Office for services that benefit both copyright owners and the general public. According to the proposed schedule and analysis submitted to Congress in October 2019, the Office strives to set fees &ldquo;at levels that maximize the recovery of reasonable costs while continuing to encourage active participation in the copyright system,&rdquo; including the production of original literary, artistic, and musical expression for the good of the public.</p> <p>The most recent cost study began in June 2017 with the Office initially proposing a fee schedule in the Federal Register in May 2018. The proposed fee schedule considered both the costs to the Office in administering services and the overall objective of the copyright system. In June 2019, the Office issued a supplemental notice proposing limited revisions to the 2018 fee schedule. It then engaged in a public notice and comment process in which the public&rsquo;s feedback was considered and used to refine the new fee schedule. Subsequently, in October 2019, the Office presented a final fee schedule to Congress for review and approval.</p> <p>The new schedule revises current prices and maintains certain fees for other services. Examples of the price increases include the following:</p> <ul> <li>Electronic filing for registration of a claim in an original work of authorship will increase from $55 to $65.</li> <li>Paper filing for registration of a claim in an original work of authorship will increase from $85 to $125.</li> <li>Registration of a claim in a group of unpublished works will increase from $55 to $85.</li> <li>Registration of works as a group in a single application will increase from $55 to $85.</li> <li>Registration of updates or revisions to databases predominantly consisting of non-photographic works will increase from $85 to $500 per application, a significant price jump that reflects the Office&rsquo;s extensive examination of lengthy submissions.</li> </ul> <p>The Office has also introduced new services, including full-term retention of a published electronic copyright deposit for a fee of $220 and voluntary cancellation of a registration for $150. A complete listing of fees for copyright registration, recordation, and other services can be found <a href="">here</a>.</p> <p>For more information, please contact Fitch Even attorney <a href=";A=16851&amp;format=xml&amp;p=5482">Kerianne A. Strachan</a>, author of this alert.<br /> <b><br /> Fitch Even IP Alert<sup>&reg;</sup></b></p>IP Alerts02 Apr 2020 00:00:00 -0800 Alert: USPTO Extends Certain Patent-Related Deadlines Under the CARES Act<p>Yesterday, the USPTO <a href="">announced</a> extensions to the time allowed to file certain patent-related documents and to pay certain required fees that would have been due on or after March 27, 2020. This action by the USPTO, made in accordance with section 12004 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, provides that a person who is unable to meet patent-related timing deadlines due to the COVID-19 outbreak may be eligible for a waiver of certain deadlines, as detailed below.<br /> &nbsp;</p> <p><b>Patent Applications and Reexamination Proceedings </b></p> <p>Due dates for the following submissions in patent applications and reexamination proceedings that would have been due March 27, 2020, through April 30, 2020, will be extended 30 days from the initial due date, provided that the filing is accompanied by a statement (provided below) that the delay in filing or payment was due to the COVID-19 outbreak:</p> <ul> <li>Reply to an office notice issued during pre-examination processing (including, e.g., a Notice of Omitted Items, Notice to File Corrected Application Papers, Notice of Incomplete Application, Notice to Comply with Nucleotide Sequence Requirements, Notice to File Missing Parts of Application, and Notification of Missing Requirements) by a small or micro-entity</li> <li>Reply to an office notice or action issued during examination (including, e.g., a final or non-final office action and Notice of Non-Compliant Amendment), or patent publication processing (including, e.g., Notice to File Corrected Applications Papers)</li> <li>Issue fee</li> <li>Notice of appeal under 35 U.S.C. &sect; 134 and 37 C.F.R. &sect; 41.31</li> <li>Appeal brief under 37 C.F.R. &sect; 41.37</li> <li>Reply brief under 37 C.F.R. &sect; 41.41</li> <li>Appeal forwarding fee under 37 C.F.R. &sect; 41.45</li> <li>Request for an oral hearing before the Patent Trial and Appeal Board (PTAB) under 37 C.F.R. &sect; 41.47</li> <li>Response to a substitute examiner's answer under 37 C.F.R. &sect; 41.50(a)(2)</li> <li>Amendment when reopening prosecution in response to, or request for rehearing of, a PTAB decision designated as including a new ground of rejection under 37 C.F.R. &sect; 41.50(b)</li> <li>Maintenance fee, filed by a small or micro-entity</li> <li>Request for rehearing of a PTAB decision under 37 C.F.R. &sect; 41.52.</li> </ul> <p>The following statement must be submitted to be eligible for the above-referenced 30-day extension:</p> <p style="margin-left: 40px;">A delay in filing or payment is due to the COVID-19 outbreak for the purposes of this notice if a practitioner, applicant, patent owner, petitioner, third party requester, inventor, or other person associated with the filing or fee was personally affected by the COVID-19 outbreak, including, without limitation, through office closures, cash flow interruptions, inaccessibility of files or other materials, travel delays, personal or family illness, or similar circumstances, such that the outbreak materially interfered with timely filing or payment.<br /> &nbsp;</p> <p><b>Patent and Appeal Board</b></p> <p>For PTAB proceedings, upon a request to the USPTO affirming that a filing due March 27, 2020, through April 30, 2020, was or may be delayed due to the COVID-19 outbreak as defined in the statement above, the PTAB will provide a 30-day extension of time for the following:</p> <ul> <li>Request for rehearing of a PTAB decision under 37 C.F.R. &sect;&sect; 41.125(c), 41.127(d), or 42.71(d)</li> <li>Petition to the Chief Judge under 37 C.F.R. &sect; 41.3</li> <li>Patent owner preliminary response in a trial proceeding under 37 C.F .R. &sect;&sect; 42.107 or 42.207, or any related responsive filings.</li> </ul> <p>Notably, if the USPTO extends a deadline for a patent owner preliminary response or any related responsive filings, the PTAB may also extend the deadlines provided in 35 U.S.C. &sect;&sect; 314(b) and 324(c).)</p> <p>For all other PTAB-related situations where the COVID-19 outbreak has prevented or interfered with a filing before the PTAB, an extension of time can be requested by calling the PTAB at 571-272-9797 or via email at</p> <ul> <li> (for AIA trials)</li> <li> (for PTAB appeals), or</li> <li> (for interferences).</li> </ul> <p>Finally, in addition to the relief outlined above, the USPTO previously waived the fee under 37 C.F.R. &sect; 1.17(m) for petitions to revive applications under 37 C.F.R. &sect; 1.137, when applicants were unable to timely reply to an office communication due to the COVID-19 outbreak, as described in the USPTO&rsquo;s notice released on March 16, 2020.</p> <p>For more information on these developments, please contact Fitch Even partner <a href=";A=4141&amp;format=xml&amp;p=5482">David M. Kogan</a>, author of this alert.<br /> <b><br /> Fitch Even IP Alert<sup>&reg;</sup></b></p>IP Alerts01 Apr 2020 00:00:00 -0800 an Invention to the Evidence: Strategic Considerations from Prosecution to Litigation<p>Please join Fitch Even for a free webinar, &ldquo;<a href="">Linking an Invention to the Evidence: Strategic Considerations from Prosecution to Litigation</a>,&rdquo; on April 23, 2020, at 9:00 am PDT / 10:00 am MDT / 11:00 am CDT / 12 noon EDT.</p> <p>Evidence that others value an invention can be used by a patent owner for many purposes, including demonstrating that the invention was not obvious, or that infringement has damaged and will continue to damage the patent owner. Yet that evidence may be of little value without the ability to tie it to the specific inventions set forth in the claims of a patent. When there are numerous reasons that customers might purchase or desire a product sold by a patent owner or infringer, establishing a nexus between the claims of the patent and real-world evidence becomes complicated.</p> <p>During this webinar, our presenters will discuss the following:</p> <ul> <li>Establishing a nexus between evidence of commercial success of real-world products and the patented invention</li> <li>Demonstrating a connection between patented features and lost profits</li> <li>Proving there is a causal nexus between irreparable harm and the patented invention that justifies an injunction</li> <li>Drafting claims with forethought to future evidentiary requirements</li> </ul> <p>Our speakers will be Fitch Even attorneys <a href=";A=2567&amp;format=xml&amp;p=5482">Mark A. Borsos</a> and <a href=";A=16703&amp;format=xml&amp;p=5482">Evan Kline-Wedeen</a>.</p> <p>Mark has comprehensive experience in patent preparation, prosecution, and litigation. He also assists clients with product clearance and licensing issues, as well as strategic patent portfolio creation, acquisition, and management.</p> <p>Evan&rsquo;s practice encompasses patent preparation and prosecution, IP litigation, patent post-issuance proceedings, and product clearance and legal opinions. He works with clients in fields including biomedical engineering, mechanical engineering, and material science.</p> <p>CLE credit has been approved for California, Illinois, and Nebraska. Other states may also award CLE credit upon attendee request. There is no fee to attend, but please note registration is required. To reserve your place, please <a href="">REGISTER HERE</a>.&nbsp;</p>Upcoming Webinars31 Mar 2020 00:00:00 -0800 Alert: Supreme Court Holds State Sovereign Immunity Extends to Copyright Infringement Suits<p>On March 23, in <a href=""><i>Allen v. Cooper</i></a>, the U.S. Supreme Court unanimously ruled that states are immune from copyright infringement suits. A significant decision affecting copyright law, the case has notable ramifications for both state governments and copyright holders.</p> <p>The circumstances instigating the case began in 1996 when the state of North Carolina hired Intersal, a marine salvage company, to recover <i>Queen Anne&rsquo;s Revenge</i>, the infamous Blackbeard flagship that had run aground off the coast of North Carolina in 1718. Intersal in turn hired petitioner Frederick Allen, a videographer, to document the recovery of the ship. For over a decade, Allen made videos and photographs of the recovery operations and registered copyrights in these works.</p> <p>The suit arose when North Carolina published some of Allen&rsquo;s works online without his consent. At the district court, the state moved to dismiss the suit on the ground of sovereign immunity, invoking the general rule that federal courts cannot hear suits brought by individuals against nonconsenting states. Allen, however, contended that Congress had abrogated the sovereign immunity of the states through the Copyright Remedy Clarification Act of 1990 (CRCA). The CRCA provides that a state &ldquo;shall not be immune, under the Eleventh Amendment . . . or any other doctrine of sovereign immunity from suit in Federal court&rdquo; for copyright infringement. The district court allowed the case to move forward in light of the CRCA, reasoning that congressional intent was clear and abrogation had a proper constitutional basis. The court concluded that precedent precluding Congress from using its Article I powers to abrogate state sovereign immunity left open some possible avenues for imposing liability.</p> <p>On interlocutory appeal, the Fourth Circuit reversed, reasoning that the decision in <i>Florida Prepaid</i> <i>Ed. Expense Bd. v. College Savings Bank</i> applied to Section 5 of the Fourteenth Amendment no less than Article I. In <i>Florida Prepaid</i>, the Supreme Court held that Congress did not have the authority to abrogate state sovereign immunity from patent infringement suits through the Patent Remedy Act because the abrogation was not &ldquo;congruent and proportional&rdquo; to the injury to be remedied. Allen appealed to the Supreme Court, and the Court affirmed.</p> <p>First, the Court explained that the Eleventh Amendment governing state sovereign immunity allows a federal court to entertain a suit against a nonconsenting state on two conditions: (1) &ldquo;Congress must have enacted &lsquo;unequivocal statutory language&rsquo; abrogating the States&rsquo; immunity from the suit,&rdquo; and (2) Congress must have had authority under the Constitution to abrogate immunity.</p> <p>The first prong was settled at the outset. The Court essentially said that the language of the CRCA makes it very clear that Congress intended that state sovereign immunity be abrogated for purposes of copyright infringement suits. Accordingly, the case turned on congressional authority to encroach on state sovereign immunity. Allen argued that Congress possessed such authority under its Article I power to provide copyright protection or under Section 5 of the Fourteenth Amendment.</p> <p>First, Article I, Section 8, Clause 8 of the U.S. Constitution&mdash;the Intellectual Property Clause&mdash;grants Congress power &ldquo;[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.&rdquo; Allen argued that congressional authority to abrogate state sovereign immunity followed naturally from this clause. But the Court pointed to its decision in <i>Florida Prepaid</i> holding that Congress could not use its Article I power to abrogate state sovereign immunity in patent infringement suits. There, the Patent Remedy Act was at issue. In an earlier case, <i>Seminole Tribe v. Florida</i>, the Court had proscribed the use of Article I to circumvent sovereign immunity&rsquo;s limits on federal jurisdiction. Based on that decision, the Court had held that Congress did not have authority to abrogate state sovereign immunity from patent infringement suits.</p> <p>Noting that Article I applies to patents and copyrights alike, the Court extended the reasoning of <i>Florida Prepaid</i> to the CRCA, holding that Congress&rsquo;s Article I powers stop at sovereign immunity. Allen attempted to argue that the Court&rsquo;s decision in <i>Central Va. Community College v. Katz</i> offered relief from <i>Florida Prepaid</i>. In that case, the Court held that the Bankruptcy Clause of Article I allows Congress to subject nonconsenting states to bankruptcy proceedings. The Court disagreed, noting <i>Katz</i> was limited to the Bankruptcy Clause, and holding that even if it were not so limited, <i>Florida Prepaid</i> in combination with <i>stare decisis </i>would sink Allen&rsquo;s argument.</p> <p>Second, Congress can permit suits against states for violations of Section 1 of the Fourteenth Amendment, but it cannot alter what that Amendment proscribes. Thus the Court said a congressional abrogation under Section 5 of the Fourteenth Amendment is valid only if it sufficiently connects to conduct courts have held Section 1 of the Fourteenth Amendment to bar. For Congress to invoke its Section 5 authority, &ldquo;[t]here must be a congruence and proportionality between the injury to be prevented or remedied and the means adopted to that end.&rdquo; This involves courts&rsquo; consideration of the constitutional problem Congress faced and the scope of the relief Congress chose to address that problem or injury. In <i>Florida Prepaid</i>, for example, the Court reasoned that Congress had very little evidence of states having infringed patents, and no evidence that any instance of infringement by states had crossed constitutional boundaries. Thus the Court held that the Patent Remedy Act swept too far, given the absence of evidence of states &ldquo;depriving patent owners of property without due process of law.&rdquo;</p> <p>Here, Congress commissioned a report regarding the effects of the Eleventh Amendment on copyright enforcement. The report ultimately concluded that &ldquo;copyright proprietors have demonstrated they will suffer immediate harm if they are unable to sue infringing states in federal court.&rdquo; But the Court determined that nothing in that report or the remainder of the legislative record sufficiently distinguished this case from <i>Florida Prepaid</i>. The report produced very little evidence of state copyright infringement and its author even acknowledged that state copyright infringement was &ldquo;not widespread.&rdquo; Moreover, the Court reasoned that neither the report nor the remainder of the legislative record showed a concern with whether the states&rsquo; copyright infringements violated the Due Process Clause. In order to constitute such a violation, the infringement must be both intentional and there must not be an adequate remedy for the infringement offered by the state. Thus the Court held that in the absence of constitutional harm, the CRCA does not pass muster under the &ldquo;congruence and proportionality&rdquo; test in light of <i>Florida Prepaid</i>.</p> <p>Among other ramifications, the case provides some cautions for entities doing business with state entities where copyrighted materials might be generated in the course of such work. Nothing in the opinion suggests that such entities could not attempt by contract to secure a state&rsquo;s agreement to refrain from copying such works, for example, thereby providing a possible remedy in state court.</p> <p>For more information, please contact Fitch Even attorney <a href=";A=18118&amp;format=xml&amp;p=5482">Vincent R. Meyer</a>, author of this alert.&nbsp;<br /> <b><br /> Fitch Even IP Alert<sup>&reg;</sup></b></p>IP Alerts25 Mar 2020 00:00:00 -0800 Alert: PTAB Patent Judge Appointments Remain Unconstitutional After Federal Circuit Denies En Banc Rehearing<p>On March 23, the Federal Circuit <a href="">denied en banc rehearing</a> of the <i>Arthrex, Inc. v. Smith &amp; Nephew, Inc.</i> case. This denial sets up a likely petition for Supreme Court review of whether the process for appointing Administrative Patent Judges (APJs), defined in the patent statute, was unconstitutional as enacted. After the Federal Circuit&rsquo;s October 2019 <a href=";an=98663&amp;anc=180&amp;format=xml&amp;p=5486">panel decision</a> in <i>Arthrex</i>, all parties in the case filed petitions for rehearing en banc, along with the United States as intervenor.</p> <p>Because the full Federal Circuit will not review the panel decision, the holdings from that decision stand: APJs are &ldquo;principal officers&rdquo; under the statute as written. They therefore were unconstitutionally appointed because they were not nominated by the president and approved by the Senate. The panel&rsquo;s remedy also stands, severing provisions of the patent statute that prevented the USPTO director from removing APJs, and requiring rehearing of final decisions decided before the court&rsquo;s October 2019 panel decision.</p> <p>The order denying rehearing was accompanied by three dissenting and two concurring opinions. Of the 12 judges who heard the petition for en banc rehearing, four judges contributed to the dissenting opinions. A separate four judges contributed to the concurring opinions.</p> <p>The fractures between the concurring and dissenting judges exist on each of the issues up for en banc review, giving ample ammunition to the parties for potential certiorari petitions. First, each of the dissenting opinions contends that APJs are not necessarily principal officers and therefore need not be political appointees. For example, Judge Dyk&rsquo;s dissent reasons that APJs are not principal officers because they have no role in the articulation of agency policy: &ldquo;Their sole function is to determine the facts in individual patent challenges under the AIA&rdquo; and &ldquo;they are obligated to follow the law as articulated by the Supreme Court and [the Federal Circuit].&rdquo; Judges Hughes and Wallach argue further that the USPTO director&rsquo;s power to direct and supervise the Patent Trial and Appeal Board (PTAB) and individual APJs, along with the fact that APJs are already removable under the efficiency of the service standard of the Administrative Procedure Act (APA), provides political accountability such that APJs should be categorized as inferior officers. As examples of the director&rsquo;s supervisory role, Judge Hughes notes that the director may issue binding policy guidance, institute and reconsider institution of an <i>inter partes</i> review, select APJs to preside over an instituted <i>inter partes</i> review, single-handedly designate or de-designate any final written decision as precedential, and convene a panel of three or more members of his choosing to consider rehearing any PTAB decision.</p> <p>On this first issue of how to categorize APJs, Judge Moore notes in her concurring opinion that the director lacks the authority to <i>independently alter a panel&rsquo;s final written decision</i> and lacks sufficient control over the panel&rsquo;s decision before it issues on behalf of the executive branch. This lack of subsequent review for any particular decision, to her and her concurring colleagues, outweighs the director&rsquo;sauthority and direction. The dissenters and the concurring judges came to opposite conclusions on how Supreme Court precedent should apply on this issue.</p> <p>The second fractured issue is whether the panel decision improperly severed removal protections for APJs from the patent statute. Judge Dyk, writing on behalf of all four dissenting judges, argues that the panel decision improperly rewrote the statute in a way that is inconsistent with congressional intent. He notes that APJs and their predecessor &ldquo;examiners-in-chief&rdquo; have enjoyed semi-independent status under the patent statute since 1975, and that administrative law judges similarly have removal protections under the APA. Thus, according to the dissenters, longstanding congressional intent existed to protect the independence of APJs, which therefore should not be eliminated.</p> <p>According to Judge Dyk, the better solution to any unconstitutionality would be to amend the patent statute to provide agency review of APJ decisions. Alternatively, he argues that the agency itself might establish APJs as inferior officers if the director allowed rehearing of APJ decisions by &ldquo;an executive rehearing panel with panel members appointed by the President or essentially removable at will by the Secretary of Commerce&mdash;the Director, the Deputy Director, and the Commissioner of Patents.&rdquo;</p> <p>The concurring judges argued that the proposals offered by the dissenters would not necessarily pass constitutional review&mdash;APJs would not necessarily be categorized as inferior officers under any of Judge Dyk&rsquo;s proposed solutions. Further, Judge Moore and the concurring judges argue that the panel decision properly corrected the statute under Supreme Court precedent.</p> <p>The third and final fractured issue is whether remand and rehearing is required for final decisions entered before the October 31, 2019, <i>Arthrex</i> panel decision. Judge Dyk and two of the other dissenters argued that a new hearing is not required under Supreme Court precedent and that such rehearings impose a large and unnecessary burden on the USPTO. They reason that the panel decision merely interpreted the statute to find the meaning it always should have had. Thus the statute never included protections that would prevent the director from removing APJs, and consequently the APJs were never unconstitutionally appointed.</p> <p>Judge O&rsquo;Malley addresses this third issue in her concurrence, arguing that Supreme Court precedent requires a new hearing before a properly appointed official when a prior adjudication is tainted with an appointments clause violation. Further, all of the concurring judges contend that remand and rehearing is a remedy that minimizes the burden and inconvenience on the patent office.</p> <p>For parties on appeal to the Federal Circuit from a final written decision entered before October 31, 2019, the current remedy is rehearing by a new panel at the PTAB. To get this remedy, parties must raise their appointments clause arguments in their opening Federal Circuit brief or an earlier motion. The Federal Circuit has held that otherwise the Appointments Clause argument is waived.</p> <p>This latest decision, however, is likely not the last word on whether APJs were unconstitutionally appointed. Congress has already held hearings on the issue. Further, as noted above, one or more of the parties or the U.S. government is likely to petition for review by the Supreme Court. The dissenting and concurring judges arrived at conflicting interpretations of the relevant Supreme Court precedent. Given the fractured opinions on the Federal Circuit and the Supreme Court&rsquo;s likely interest in this wide-reaching administrative law issue, the Supreme Court may be inclined to take the case. Until the matter is resolved by Congress or the Supreme Court, some uncertainty will remain. Fitch Even attorneys will continue to monitor developments related to this case.</p> <p>For more information on this decision, please contact Fitch Even partner <a href=";A=2585&amp;format=xml&amp;p=5482">David A. Gosse</a>, author of this alert.<br /> <b><br /> Fitch Even IP Alert&reg;</b></p>IP Alerts25 Mar 2020 00:00:00 -0800 Alert: Federal Circuit Rules ยง 315(c) Does Not Authorize Same-Party Joinder or Joinder of New Issues<p>On March 18, in <i><a href="">Facebook, Inc. v. Windy City Innovations, LLC</a></i>, the Federal Circuit held that the Patent Trial and Appeal Board (PTAB) erred in allowing a petitioner to join itself to an <i>inter partes </i>review (IPR) to which it was already a party and in allowing the petitioner to add new challenged claims through the joinder. In an addendum to its opinion, the Federal Circuit also maintained that decisions by the PTAB&rsquo;s Precedential Opinion Panel (POP) are not entitled to what is known as Chevron deference by reviewing courts.</p> <p>Windy City filed a patent infringement suit against Facebook, asserting four patents. In its complaint, Windy City did not specify which of the patents&rsquo; 830 claims Facebook infringed. On the last day of the one-year window under 35 U.S.C. &sect; 315(b), Facebook filed four IPR petitions challenging some but not all of the claims in Windy City&rsquo;s four asserted patents. The PTAB instituted these IPRs on nearly all grounds. Four months after the one-year window, Windy City identified the claims that it was asserting in the district court case. Of the asserted claims, some were not challenged in Facebook&rsquo;s IPR petitions.</p> <p>In response, Facebook prepared two additional IPR petitions to challenge Windy City&rsquo;s additional asserted claims. Because the petitions were otherwise time-barred, Facebook filed motions to join these new proceedings with the already-instituted IPRs under section 315(c). The PTAB granted Facebook&rsquo;s motions, reasoning that although the claims were not the same as those originally instituted, the substance of the claims was similar, so the addition of the claims would be unlikely to significantly impact the scope of the trial. Further, the PTAB reasoned that Facebook could not have reasonably determined the claims asserted against it within the one-year time bar.</p> <p>In its final written decisions, the PTAB held that some but not all challenged claims were obvious. Facebook appealed, and Windy City cross-appealed. On appeal, Windy City argued that section 315(c) does not authorize same-party joinder and the joinder of new issues material to patentability. The Federal Circuit agreed.</p> <p>The plain text of section 315(c) provides that the Director of the USPTO &ldquo;may <b>join as a party</b> to [an IPR] <b>any person</b> who properly files a petition under section 311 that the Director . . . determines warrants the institution . . .&rdquo; (emphasis added). As an initial matter, the Federal Circuit noted that when the PTAB granted Facebook&rsquo;s joinder motions, it did not join Facebook as a party. Rather, the PTAB joined the later proceedings to the earlier proceedings. The court held that the language of section 315(c) does not provide for the consolidation of proceedings, which is governed by section 315(d).</p> <p>Even assuming that the PTAB had in fact joined Facebook as a party, the Federal Circuit held that the plain text of section 315(c) does not authorize same-party joinder. The court reasoned that it would be an extraordinary usage of the term &ldquo;join as a party&rdquo; in section 315(c) to refer to persons who were already parties. The court acknowledged the PTAB&rsquo;s POP decision in <i>Proppant Express Invs., LLC v. Oren Techs., LLC</i>, which determined that same-party joinder under section 315(c) was permissible. But the court held PTAB&rsquo;s decision in <i>Proppant </i>was incorrect given the unambiguous language of the statute.</p> <p>With respect to the joinder of new issues, the Federal Circuit held that section 315(c) also does not authorize a joined party to bring new issues into a proceeding. Instead, the consolidation of proceedings is covered under section 315(d). Reading section 315(c) to permit the consolidation of proceedings or issues would render section 315(d) superfluous.</p> <p>Further, the court held that the clear and unambiguous language of section 315(c) could not be overridden by Facebook&rsquo;s policy arguments that joinder was appropriate because Windy City did not identify which claims were asserted until after the one-year IPR deadline. The court noted that parties are free to challenge all claims of an asserted patent in an IPR or to challenge the invalidity of asserted claims in district court proceedings. The court also noted that Facebook could have made different strategy choices in federal court to force an earlier identification of asserted claims.</p> <p>Because the plain language of section 315(c) was found to be unambiguous, the court did not reach the issue of what deference should be given to decisions by the POP. Here Facebook argued that the PTAB&rsquo;s POP decision in<i> Proppant</i>, which permitted same-party joinder under section 315(c), should be given deference. Following the opinion, the court provided &ldquo;additional views&rdquo; on this issue.</p> <p>The court explained that Chevron deference is afforded to an agency&rsquo;s implementation of a particular statutory provision only when it appears that Congress delegated the authority to issue rules carrying the force of law. Of note, the court found that Congress did not authorize the Director of the USPTO or the PTAB to undertake statutory interpretation through POP opinions. Accordingly, even if section 315(c) were ambiguous, there would be no deference given to the POP decision in <i>Proppant</i>.</p> <p>This decision is relevant to both parties involved in patent litigation as well as in IPR proceedings. First, a petitioner may no longer file a subsequent petition to join its own instituted IPR proceeding in an attempt to add new issues or claims. Accordingly, there will be more pressure on petitioners to challenge all potentially assertable claims in its IPR petition. As in this case, where a patent owner has not identified which claims it is asserting in litigation, the defendant should make a concerted effort to have the asserted claims identified well ahead of the one-year bar date to file an IPR. Alternatively, if possible, a petitioner should consider challenging each claim of a challenged patent out of an abundance of caution.</p> <p>The case is further notable in that at least three judges of the Federal Circuit have indicated that they would not give Chevron deference to decisions deemed precedential by the PTAB. Thus parties should be wary of citing any such opinions to the courts as precedential authorities.</p> <p>For more information on this holding, please contact Fitch Even partner <a href=";A=2587&amp;format=xml&amp;p=5482">Paul B. Henkelmann</a>, author of this alert.</p> <p><i>Fitch Even attorney <a href=";A=19278&amp;format=xml&amp;p=5482">Jacqueline L. Thompson</a> contributed to this alert.<br /> <br /> </i><b>Fitch Even IP Alert<sup>&reg;</sup></b></p>IP Alerts23 Mar 2020 00:00:00 -0800 COVID-19 Response and Business Continuity Update<p>As the impact of the novel coronavirus disease (COVID-19) continues, we at Fitch Even recognize that you and your loved ones are coping with adjustments necessitated by the pandemic, just as we are. Our thoughts are with all those around the world who are affected by the outbreak now or will be in future days.</p> <p>As we continue to monitor the COVID-19 situation and adhere to CDC and other governmental guidelines, our paramount concern is the well-being of our professionals, families, clients, and the communities in which we live and work. Accordingly, we have put measures in place that help to ensure safety for our people while we continue to seamlessly serve our clients' legal and business needs.</p> <p>Our firm is fully operational with our people working remotely for the time being. Our attorneys and teams have the support, technology, and capacity to serve our clients and continue operations on an uninterrupted basis. All our internal systems and files can be accessed remotely through a secure network. This access includes our paperless file system and all research and filing tools. Our state-of-the-art IT infrastructure is maintained 24/7 by our IT professionals.</p> <p>In short, your calls and emails are being answered, meetings are being held by audio or video conferencing, and we will continue to provide you with the same responsive counsel and exceptional work product you expect and deserve.</p> <p>Thank you for your ongoing trust in Fitch Even. We look forward to working with you to address and overcome these current challenges. Please do not hesitate to reach out to us if we can be of any assistance. As always, we are here for you.</p> <p>Sincerely,<br /> <br /> Mark W. Hetzler<br /> Managing Partner<br /> Fitch, Even, Tabin &amp; Flannery LLP</p> <p>&nbsp;</p>Firm News20 Mar 2020 00:00:00 -0800 Even Partner Tim Maloney to Speak at the Litigation Funding Forum 2020<p>Fitch Even partner <a href=";A=2601&amp;format=xml&amp;p=5482">Timothy P. Maloney</a> will be a featured speaker during the Litigation Funding Forum 2020, taking place on March 26. This will be an online event following the same agenda as the originally scheduled in-person conference in NYC.</p> <p>Tim&rsquo;s presentation will be &ldquo;A Fresh Look at the Patent Assignment Agreement: <i>Lone Star v. United Microelectronics</i>.&rdquo; In addition to detailing the impact of the <i>Lone Star</i> case on the patent privateering monetization model, Tim will provide recommendations on how to transfer ownership in a way that protects a patent assertion entity&rsquo;s rights to pursue infringement lawsuits.</p> <p>To learn more about the conference, please visit the <a href="">Litigation Funding Forum website</a>.</p>Professional Activities12 Mar 2020 00:00:00 -0800 Alert: Federal Circuit Provides Further Guidance Regarding Subject Matter Eligibility<p>On March 6, in <a href=""><i>Customedia Technologies, LLC v. Dish Network Corporation et al.</i></a>, the Federal Circuit affirmed Patent Trial and Appeal Board (PTAB) decisions finding two patents generally relating to &ldquo;comprehensive data management and processing systems&rdquo; patent-ineligible under 35 U.S.C. &sect; 101. Importantly, the case provides further guidance on the &ldquo;abstractness&rdquo; doctrine and the Federal Circuit&rsquo;s analysis under this doctrine.</p> <p>Customedia&rsquo;s two patents, U.S. Patent Nos. 8,719,090 and 9,053,494, share the same specification. Each patent discloses systems whose essential purpose is for targeted advertising to consumers watching television. The disclosed systems comprise a &ldquo;remote Account-Transaction Server (ATS) and a local host Data Management System and Audio/Video Processor Recorder-player (VPR/DMS),&rdquo; such as a cable set-top box. Data is transmitted via the ATS to the VPR/DMS and then &ldquo;selectively recorded in programmable storage sections in the VPR/DMS&rdquo; based on user preferences. The storage sections can be &ldquo;reserved, rented, leased or purchased from end user[s], content providers, broadcasters, cable/satellite distributor, or other data communications companies administering the data products and services.&rdquo;</p> <p>DISH petitioned the PTAB for review of certain claims of each patent pursuant to CBM review, and the PTAB instituted CBM review on claims for both patents. In addition to the section 101 rejections, the PTAB found some claims ineligible under sections 102 and 112, but the court did not reach those rejections on appeal.</p> <p>In analyzing the subject matter eligibility, the court looked to the two-step analysis set out in the Supreme Court&rsquo;s decision in <i>Alice Corp. v. CLS Bank Int&rsquo;l</i>. This framework requires that courts first determine whether the claims are directed to a judicial exception (i.e., an abstract idea, law of nature, or natural phenomena), and then determine whether the claim recites additional elements that supply an inventive concept sufficient to transform the nature of the claim into a patent-eligible application of the exception such that the patent is directed to something significantly more than the ineligible subject matter itself.</p> <p>For the first step, the court determined the subject matter of the claims to be directed to an abstract idea. Customedia argued that the claims of the patent are directed to an improvement in the functioning of a computer, pointing to language in <i>Alice</i>. The court disagreed, however, reasoning that the claims at issue, rather than being directed to improvements to operations and functionality of a system, are directed to the abstract idea of using a computer to deliver targeted advertising to a user.</p> <p>Further, the court rejected Customedia&rsquo;s argument that by reserving memory for advertising data, the system was improved, noting that the &ldquo;functionality of <i>the computer itself</i>&rdquo; (emphasis added) is not improved. Rather, the court said the concept of delivering targeted advertising <i>using a computer as a tool</i> is improved. The court found support for this important key difference in a number of previous decisions, including <i>Ancora Techs. Inc. v. HTC America, Inc.</i>, where the court held claims non-abstract and patent-eligible because they were directed to storing a verification structure in computer memory, which improved computer security. Thus, here the court found that the claims were directed to an abstract concept, emphasizing the distinction between improving the system itself and improving the abstract concept through use of a system or computer. &nbsp;&nbsp;&nbsp;</p> <p>Turning to the second step, the court determined that additional elements of the claims &ldquo;considered individually and as an ordered combination&rdquo; did not &ldquo;recite an inventive concept.&rdquo; The court reasoned that besides the concept of delivering targeted advertising, the claims did not provide more than generic computer components. The court further rejected Customedia&rsquo;s argument that the programmable receiver to dedicate a section of memory specifically for identified advertising data was an improvement over the prior art. Specifically, the court cited a prior case and said, &ldquo;the invocation of &lsquo;already-available computers that are not themselves plausibly asserted to be an advance . . . amounts to a recitation of what is well-understood, routine, and conventional.&rsquo;&rdquo;</p> <p>Thus, because the claims did not disclose an improvement in the computer itself, the additional elements of the claims did not make the abstract concepts claimed patent-eligible, and the court affirmed the decision of the PTAB holding claims of the patents ineligible under section 101. &nbsp;</p> <p>&nbsp;For more information on this case, please contact Fitch Even attorney <a href=";A=18118&amp;format=xml&amp;p=5482">Vincent R. Meyer</a>, author of this alert.<br /> <b><br /> Fitch Even IP Alert<sup>&reg; </sup>&nbsp;</b></p>IP Alerts10 Mar 2020 00:00:00 -0800