Top Five Stories of 2016

By Donald Zuhn –-

After reflecting upon the events of the past twelve months, Patent Docs presents its tenth annual list of top patent stories.  For 2016, we identified twenty stories that were covered on Patent Docs last year that we believe had (or are likely to have) a significant impact on patent practitioners and applicants.  In previous posts, we counted down stories #20 to #16, stories #15 to #11, and stories #10 to #6, and today we count down the top five stories of 2016.  As with our other lists (2015, 2014, 2013, 2012, 2011, 2010, 2009, 2008, and 2007), links to our coverage of these stories (as well as a few links to articles on related topics) have been provided in case you missed the articles the first time around or wish to go back and have another look.  As always, we love to hear from Patent Docs readers, so if you think we left something off the list or disagree with anything we included, please let us know.  In addition, we will be offering a live webinar on the "Top Patent Law Stories of 2016" on January 18, 2017 from 10:00 am to 11:15 am (CT).  Details regarding the webinar, which will focus on a handful of the most important stories on this year's list, can be found here.

5.  Federal Circuit Finds That Continuation Filed on Same Day Parent Issues Satisfies 35 U.S.C. § 120

Last year, a pair of District Court decisions, including the decision by the District Court for the District of Delaware in Immersion Corp. v. HTC Corp., came in at #16 on our list of Top Stories for 2015.  In June, the Federal Circuit reversed the decision of the District Court that Immersion Corporation's U.S. Patent No. 7,148,875 was not "filed before the patenting" of U.S. Patent No. 6,429,846 within the meaning of 35 U.S.C. § 120, because the '875 patent application was filed on the same day that the '846 patent issued.  In an opinion by Judge Taranto, joined by Chief Judge Prost and Judge Linn, the Federal Circuit noted that the question is "whether . . . the continuing application has to be filed at least one day before the earlier application is patented, or whether an application may be 'filed before the patenting' of the earlier application when both legal acts, filing and patenting, occur on the same day" (emphasis in original).  The panel also noted that "same-day continuations have been approved by a consistent, clearly articulated agency practice going back at least half a century, which has plausibly engendered large-scale reliance and which reflects the agency's procedural authority to define when the legal acts of 'filing' and 'patenting' will be deemed to occur, relative to each other, during a day."

For information regarding this and other related topics, please see:

• "Immersion Corp. v. HTC Corp. (Fed. Cir. 2016)," June 26, 2016

4.  USPTO Issues More Subject Matter Eligibility Guidance

Last spring, the U.S. Patent and Trademark Office issued the May 2016 Subject Matter Eligibility Update, which provides further guidance for determining subject matter eligibility under 35 U.S.C. § 101.  The May Update discusses a memorandum on subject matter eligibility determinations that was issued to the patent examining corps, and provides additional life sciences examples that are intended to assist examiners in making eligibility determinations, an updated index of eligibility examples, and an updated list of court decisions (Supreme Court and Federal Circuit) addressing subject matter eligibility.  Among the six additional life sciences examples (which brings the total number of examples for all technologies to 33) is an example (29) that includes seven claims directed to the detection of a hypothetical protein, JUL-1, and the diagnosis and/or treatment of a hypothetical autoimmune disease, julitis.  Exemplary claims 2-6 of Example 29 are directed to method of diagnosing julitis, or diagnosing and treating julitis, in a patient.  Whether the latest update to the USPTO's subject matter eligibility guidance will prove to be helpful to applicants has yet to be determined.

For information regarding this and other related topics, please see:

• "USPTO Charting the Way for Subject Matter Eligibility," November 23, 2016
• "USPTO to Hold Roundtables on Subject Matter Eligibility," November 6, 2016
• "USPTO Issues Memorandum on Recent Subject Matter Eligibility Decisions," November 2, 2016
• "USPTO Releases Memorandum on Subject Matter Eligibility," July 18, 2016
• "Subject Matter Eligibility Guidance -- Example on Screening for Gene Alterations," June 9, 2016
• "The Recent PTO Guidance on Subject Matter Eligibility: Lessons," May 25, 2016
• "Subject Matter Eligibility Guidance -- Example on Diagnosing and Treating Julitis," May 12, 2016
• "USPTO Issues Update to Subject Matter Eligibility Guidance," May 9, 2016
• "Was the Deck Stacked? Federal Circuit Refuses to Rule on Scope of USPTO Patent Guidance," April 7, 2016

3.  Supreme Court Finds: (1) USPTO Properly Applies BRI Standard to Construe Claims in IPRs, and (2) Decision to Institute IPR Is Not Subject to Judicial Review

In June, in its first pronouncement regarding the post-grant review proceedings established under the America Invents Act, the Supreme Court ruled that the U.S. Patent and Trademark Office's positions on two of the law's provisions regarding inter partes review were correct.  First, the Court held unanimously that the USPTO properly applied the "broadest reasonable interpretation" standard for claim construction for IPRs.  Second, six members of the Court also agreed that the statute mandated that the decision to institute an IPR was not subject to judicial review.  Justice Breyer authored the decision of the Court, with Justice Thomas authoring a concurring opinion to voice his continued displeasure with judicial deference to administrative agencies under Chevron USA Inc. v. Nat'l Defense Council, Inc.  On the second question Justice Alito penned a dissent, which was joined by Justice Sotomayor.

For information regarding this and other related topics, please see:

• "Cuozzo Speed Technologies, LLC v. Lee (2016) -- Question 2 -- PTAB Shenanigans and Reviewability," June 20, 2016
• "Cuozzo Speed Technologies LLC v. Lee (2016)," June 20, 2016
• "Of Patent Trolls and Hot Dog Stands -- The Supreme Court Oral Argument in Cuozzo Speed Technologies, LLC v. Lee," April 25, 2016
• "Supreme Court Preview -- Cuozzo Speed Technologies, LLC v. Lee -- Question 2," March 9, 2016
• "Cuozzo Speed Technologies, LLC v. Lee," January 18, 2016

2.  Continuing Fallout from Alice Corp. v. CLS Bank Int'l -- Courts and PTAB Find Patent Eligibility in Some Cases

It has become abundantly clear that the Supreme Court's 2014 Alice Corp. v. CLS Bank decision has significantly changed the patent-eligibility landscape for business methods and some types of software inventions.  For instance, in 2015, approximately 70% of all patents challenged under Alice in district courts were invalidated, while the monthly 35 U.S.C. § 101 rejection rates for USPTO Technical Centers 3620, 3680, and 3690 were over 85% for most of the year.  These sobering statistics are due to the two-prong subject matter eligibility test set forth in Alice.  Particularly, one must first determine whether the claim at hand is directed to a judicially-excluded law of nature, a natural phenomenon, or an abstract idea.  If so, then one must further determine whether any element, or combination of elements, in the claim is sufficient to ensure that the claim amounts to significantly more than the judicial exception.  But generic computer implementation of an otherwise abstract process does not qualify as "significantly more."  Notably, the abstract idea exclusion has been heavily employed against the aforementioned business method and software inventions.  However, in four separate opinions issued by the Federal Circuit last year -- Enfish, LLC v. Microsoft Corp., BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC; McRO, Inc. v. Bandai Namco Games America Inc.; and Amdocs (Israel) Limited v. Openet Telecom, Inc. -- the Court surprised some in the patent community by finding challenged claims to be patent eligible.  These decisions may provide some light at the end of the tunnel for applicants who have struggled to protect business method and software inventions since Alice.

For information regarding this and other related topics, please see:

• "Garfum.com Corp. v. Reflections by Ruth (D.N.J. 2016)," December 26, 2016
• "Verint Systems Inc. v. Red Box Recorders Ltd. (S.D.N.Y. 2016)," December 13, 2016
• "Amdocs (Israel) Limited v. Openet Telecom, Inc. (Fed. Cir. 2016)," November 27, 2016
• "USPTO Charting the Way for Subject Matter Eligibility," November 23, 2016
• "Location-Based Online Gaming Patents Found to be Directed to Patentable Subject Matter," November 7, 2016
• "USPTO Issues Memorandum on Recent Subject Matter Eligibility Decisions," November 2, 2016
• "Intellectual Ventures I LLC v. Symantec Corp. -- Judge Mayer on the First Amendment" October 24, 2016
• "Perdiemco, LLC. v. Industrack LLC (E.D. Tex. 2016)," October 20, 2016
• "Recent Software Case Gives Important Lessons for Biotech," October 17, 2016
• "September Was a Good Month for Patent Eligibility in the District Courts," October 16, 2016
• "Iron Gate Security, Inc. v. Lowe's Companies, Inc. (S.D.N.Y. 2016),"September 21, 2016
• "Zak v. Facebook, Inc. (E.D. Mich. 2016)," September 19, 2016
• "McRO, Inc. v. Bandai Namco Games America Inc. (Fed. Cir. 2016)," September 13, 2016
• "Core Wireless Licensing S.A.R.L. v. LG Electronics, Inc. (E.D. Tex. 2016)," August 30, 2016
• "Intellectual Ventures I LLC v. J. Crew Group, Inc. (E.D. Tex. 2016)," August 29, 2016
• "Of Technical Tools and Problems: Going Beyond the Two-Prong Alice Test," August 21, 2016
• "BASCOM Global Internet Services, Inc. v. AT&T Mobility LLC (Fed. Cir. 2016)," June 27, 2016
• "Femto-Sec Tech, Inc. v. Lensar, Inc. (C.D. Cal. 2016)," June 15, 2016
• "USPTO Issues Memorandum Regarding Enfish and TLI," May 26, 2016
• "Section 101 and the Growing Alice Backlash," May 15, 2016
• "Enfish, LLC v. Microsoft Corp. (Fed. Cir. 2016)," May 12, 2016
• "Avago Technologies General IP (Singapore) Pte Ltd. v. Asustek Computer, Inc. (N.D. Cal. 2016)," May 3, 2016
• "Samsung Electronics America, Inc. v. Smartflash LLC (PTAB 2016)," April 19, 2016
• "Global Cash Access, Inc. v. NRT Technology Corp. (D. Nev. 2016)," April 12, 2016
• "Treehouse Avatar LLC v. Valve Corp. (D.C. Del. 2016)," April 4, 2016
• "Gonzalez v. Infostream Group, Inc. (E.D. Tex. 2016)," February 22, 2016
• "NRT Technology Corp. v. Everi Payments, Inc. (PTAB 2016)," February 2, 2016
• "Genband US LLC v. Metaswitch Networks Corp. (E.D. Tex. 2016)," January 14, 2016
• "Motio, Inc. v. BSP Software LLC (E.D. Tex. 2016)," January 11, 2016

1.  Supreme Court Refuses to Hear Sequenom

Last year, the story coming in at #1 on our list of Top Stories for 2015 was the Federal Circuit's decision in Ariosa Diagnostics, Inc. v. Sequenom, Inc., in which the Federal Circuit affirmed the District Court's grant of summary judgment of invalidity that the claims of U.S. Patent No. 6,258,540 were patent ineligible.  Although the Federal Circuit appreciated that the inventors had found cell-free fetal DNA (cffDNA) in maternal plasma or serum "that other researchers had previously discarded as medical waste," the panel stated that "[a]pplying a combination of known laboratory techniques to their discovery," the inventors "implemented a method for detecting the small fraction of paternally inherited cffDNA in maternal plasma or serum to determine fetal characteristics, such as gender."  In affirming the District Court decision, the opinion concluded that "[t]he method . . . begins and ends with a natural phenomenon," and "[t]hus, the claims are directed to matter that is naturally occurring."  Judge Linn noted in his concurring opinion that he joined the majority "only because [he is] bound by the sweeping language of the test set out in Mayo Collaborative Services v. Prometheus Laboratories, Inc."  Sequenom responded to the decision by filing a petition for rehearing en banc, which the Federal Circuit denied.  In March, Sequenom filed a petition for certiorari for Supreme Court review of the Federal Circuit's decision, advising the Court that it "should take this opportunity to provide the guidance the Federal Circuit is openly seeking, and avoid a result neither it nor Congress could have intended."  In response to Sequenom's petition for certiorari, a total of twenty-two amicus briefs were filed encouraging the Court to grant certiorari.  However, in June, the Supreme Court surprised many in the the patent community by issuing an order denying certiorari in the case.

For information regarding this and other related topics, please see:

• "Supreme Court Denies Certiorari in Sequenom v. Ariosa," June 27, 2016
• "Amicus Briefs in Support of Sequenom's Petition for Certiorari: Dr. Chakrabarty, A Scientist's View," June 19, 2016
• "Amicus Briefs in Support of Sequenom's Petition for Certiorari: Eli Lilly and Company et al.," June 16, 2016
• "Amici Support Certiorari in Sequenom v. Ariosa," May 2, 2016
• "Genetic Technologies Ltd. v. Merial L.L.C. (Fed. Cir. 2016)," April 10, 2016
• "Coalition for 21st Century Medicine Comments on Expected Ariosa Cert Petition," April 3, 2016
• "Sequenom Petitions for Certiorari," March 21, 2016

Comments

[EG]

Hey Don,

Listing the denial by Our Judicial Mount Olympus of Sequenom's petition for cert was definitely the No. 1 story for 2017, and utterly shameful cowardice and neglect on their part for creating this mess in the first place. Time to strip SCOTUS of any appellate review in patent cases.

[Paul Cole]

There is a famous piece of dialogue in the Sherlock Holmes Story Silver Blaze:

“Is there any point to which you would wish to draw my attention?”
“To the curious incident of the dog in the night-time.”
“The dog did nothing in the night-time.”
“That was the curious incident,” remarked Sherlock Holmes.

So what can we learn from the curious incident of denial of certiorari in Ariosa, where the number, content and sources of the many amicus briefs strongly suggested that the petition would be granted? That requires consideration of what principles of law flow from the earlier cases considered as a whole, and what is argued in the various briefs, including the amicus briefs considered collectively. What would the Justices and their clerks thought of them?

There is no point in throwing about allegations of cowardice or neglect unless and until proper legal analysis has been carried out. For example, at a recent conference in the US I asked about 15 biotechnology attorneys under what category within 35 USC 101 an isolated sequence of naturally occurring DNA might be eligible. There is an undoubtedly correct answer from previous case law, and none of them gave it.