IP Law Alert

IP Law Alert

Practical Perspectives on Intellectual Property Legal Developments

Case Highlight: California District Court Refuses to Stay Civil Case Pending Resolution of Potential Criminal Prosecution

Posted in Trademark, Trademark Counterfeiting

In Sanrio, Inc. v. Ronnie Home Textile Inc., the U.S. District Court for the Central District of California recently refused to stay a civil case pending completion of a parallel criminal counterfeiting investigation.

In Sanrio, the plaintiffs sued a corporation and two alleged principals for trademark infringement and other claims. The case was filed after law enforcement seized allegedly counterfeit goods offered for sale by the defendants and related evidence. The defendants argued that the civil case should be stayed because the seizure left them without means to substantively defend themselves. They further argued that allowing the civil case to go forward would implicate the individual defendants’ Fifth Amendment rights, though criminal charges had not been brought against them.

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Case Update: CryoLife Appeals Preliminary Injunction to Declaratory Judgment Defendant in Patent Case

Posted in Patent

CryoLife, Inc. has appealed the preliminary injunction recently issued against it in the United States District Court for the District of Delaware barring sales of its PerClot Topical blood-clotting powder product. CryoLife Inc. v. C.R. Bard Inc. et al., Dkt. Entry No. 121, Notice of Appeal. CryoLife has asked United States Court of Appeals for the Federal Circuit to review the district court’s grant of a preliminary injunction based on CryoLife’s failure to present (1) an alternative non-infringement argument based on Medafor, Inc.’s proposed claim construction and (2) expert analysis to support its invalidity contentions. As security, Medafor has agreed to pay CryoLife $100,000 if the injunction is overturned.

CryoLife originally sought a declaratory judgment that PerClot, brought to market in Fall 2014, did not infringe on Medafor’s Arista, approved in 2006. Both products are powders used to control bleeding. In turn, Medafor sought a preliminary injunction. As we discussed last month, the district court sided with Medafor, enjoining CryoLife’s sale of PerClot—a rare event in a patent case.

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Congress Reintroduces Innovation Act in Hopes to Curb Frivolous Patent Litigation

Posted in Patent, USPTO

Recently, House Judiciary Committee Chairman Robert Goodlatte reintroduced a patent reform bill, known as the Innovation Act of 2015 (H.R. 9) (“The Act”). This reintroduced bipartisan bill is substantially similar to its predecessor, Innovation Act of 2013. The Innovation Act of 2013 had received overwhelming support by the House of Representatives, but was ultimately tabled, along with other patent reform bills, due to bipartisan disputes.

According to Rep. Goodlatte, the objective of the Innovation Act is to prevent the use of the patent system as “a playground for litigation extortion and frivolous claims.” The bill aims to curb the exponential increase in the use of weak or poorly granted patents by patent assertion entities to file numerous patent infringement lawsuits.

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The Patient Survives: Third Party Challenge to PTO Revival of Patent Application Barred under the Administrative Procedures Act

Posted in Patent

The Federal Circuit Court of Appeals recently held that a third party may not challenge a decision by the United States Patent and Trademark Office (“PTO”) to revive an application under the Patent Cooperation Treaty and enabling statutes (“PCT”) through the Administrative Procedures Act (“APA”). See Excela Pharma Sciences, LLC v. Lee, No. 13-1206 (Fed. Cir. Mar. 26, 2015). In combination with the Federal Circuit’s prior holding in Aristocrat Technologies Australia Pty Ltd. v. International Game Technology, 543 F.3d 657 (Fed. Cir. 2008), this holding puts such decisions beyond the reach of third parties, whether affirmatively attacked under the APA or defensively raised in a later infringement action.

Here, SCR Pharmatop filed an application for a patent in France in 2000, and filed an international patent application under the PCT identifying the United States as one of the designated states on June 6, 2001. In the United States, SCR Pharmatop missed a December 6, 2002 deadline to submit certain documents and fees in accordance with provisions of 35 U.S.C. § 371, and was deemed to have abandoned its application. SCR Pharmatop petitioned the PTO to revive the application on January 2, 2003, stating that the abandonment was “unintentional;” the PTO granted the petition and, following examination, United States Patent No. 6,992,218 (the ‘218 patent) issued on January 31, 2006.

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TTAB Rulings May Have Preclusive Effects in District Court Cases

Posted in Trademark, USPTO

In a 7-2 split decision issued on March 24, 2015, the U.S. Supreme Court held that Trademark Trial and Appeal Board (“TTAB”) rulings may have preclusive effects in subsequent federal district court litigation. The Court ruled that so long as the elements of issue preclusion are met, it is irrelevant that the TTAB is not an Article III court.

The decision in B&B Hardware, Inc. v. Hargis Indus., Inc. concluded an 18-year trademark dispute between two fastener manufacturers, B&B Hardware, Inc. (“B&B”) and Hargis Industries, Inc. (“Hargis”). In short, B&B registered the mark SEALTIGHT for its fasteners for the aerospace industry in 1993. Three years later, Hargis applied for federal trademark registration of its product “SEALTITE” for its fasteners for construction industry. B&B opposed Hargis’s attempt to register the mark “SEALTITE.” alleging before the TTAB that the marks were confusingly similar.

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Award of Preliminary Injunction to Declaratory Judgment Defendant in the District of Delaware Offers Cautionary Tale in Opposition Strategy

Posted in Patent

District Court Judge Sue L. Robinson, U.S.D.J., of the United States District Court for the District of Delaware granted a rare preliminary injunction to the declaratory judgment defendant in a patent infringement action, highlighting the importance of presenting infringement arguments under both parties’ claim constructions and expert analysis that supports invalidity. CryoLife Inc. v. C.R. Bard Inc. et al., No. 14-559, Dkt. Entry No. 116, Mem. Order. The injunction bars sales of PerClot Topical, CryoLife’s blood-clotting powder product.

After receiving clearance from the U.S. Food and Drug Administration (“FDA”) to market its product for topical use last spring, CryoLife filed a declaratory judgment action, seeking to invalidate Medafor’s U.S. Patent No. 6,060,461 directed at a method for applying blood-clotting powders, or receive a determination of non-infringement. PerClot Topical was subsequently launched in fall 2014, in competition with Medafor’s product Arista, which was approved by the FDA in 2006.

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Federal Circuit Limits Patent Exhaustion

Posted in Patent

A recent decision by the Federal Circuit, Helferich Patent Licensing LLC v. The New York Times Co., has held that the applicability of the patent exhaustion defense may be limited to a claim-by-claim determination depending on the nature of the licensed rights granted.

In Helferich, the patent owner held rights to a portfolio of patents with claims relating to providing content to wireless handsets and relating to methods for updating content stored on the wireless handsets. Prior to bringing the present litigation, Helferich had licensed handset manufacturers under the patents with the license grants being directed specifically to the handset claims. Subsequently, the patent owner brought suit against The New York Times Company and others asserting infringement of the content claims.

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Potential Delay Enough to Reduce PTA

Posted in Patent, USPTO

The Federal Circuit recently addressed the issue of whether Patent Term Adjustment (“PTA”) can be reduced under 35 U.S.C. § 154(b)(1)(C) by conduct that does not actually cause delay in the conclusion of prosecution. Section 154(b)(1)(C) provides that PTA “shall be reduced by a period equal to the period of time during which the applicant failed to engage in reasonable efforts to conclude prosecution of the application.” The USPTO has interpreted the statute to mean that conduct that did delay or that could potentially delay the examination of a patent applications should be sanctioned. In Gilead Sciences Inc. v. Lee, Gilead Sciences, Inc. (“Gilead”) contested the USPTO’s interpretation and argued that the statue required actual delay in the conclusion of prosecution. The Federal Circuit held that Congress’s intent in enacting the statute was “to sanction not only applicant conduct or behavior that result in actual delay, but also those having the potential to result in delay irrespective of whether such delay actually occurred.”

The timeline of events regarding Gilead’s application for U.S. Patent No. 8,148,374 (the “’374 patent”) is as follows:

  • February 22, 2008 – Gilead filed its application for the ’374 patent;
  • November 18, 2009 – The USPTO issued a restriction requirement;
  • February 18, 2010 – Gilead responded to the restriction requirement;
  • April 16, 2010 – Gilead filed a supplemental information disclosure statement (“IDS”);
  • July 29, 2011 – USPTO issued a notice of allowance;
  • April 3, 2012 – ’374 patent issued.

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Heightened Pleading in Patent Complaints to Frustrate Trolls – Exception for Hatch-Waxman/ANDA Cases

Posted in Patent

All branches of government have worked to decrease frivolous litigation by non-practicing entities (“NPEs”), or patent trolls, in order to both encourage developing technology and allow businesses to utilize that technology without a looming threat of disruptive and costly litigation. In the course of our coverage of these efforts, we have seen state and federal legislative bodies, as well as the United States Patent and Trademark Office (“USPTO”), the executive branch, and the courts, suggesting potential solutions. Congress is currently weighing a revamped version of House Judiciary Committee Chairman Bob Goodlatte’s Innovation Act bill, which seeks to reform patent litigation by focusing on pleading standards.

The pleading standard applicable to patent cases is the same as applied to any other complaint governed under Federal Rule of Civil Procedure 8 (a), requiring merely a short and plain statement for relief with sufficient factual grounds to give rise to a plausible inference that relief will be granted, per Twombly and Iqbal. Only a few special matters must be plead with particularized pleading under Rule 9, e.g., causes of action alleging fraud or mistake. In the patent realm, inequitable conduct allegations must meet this higher standard, because the basis of the allegation is that the patentee conducted a fraud on the USPTO. See Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312 (Fed. Cir. 2009).

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The United States Deposits Ratification of the 1999 Geneva Act of the Hague Agreement and Becomes a Member Country of the Hague System

Posted in Patent, USPTO

On Friday, February 13, 2015, the United States deposited an instrument of ratification to the 1999 Geneva Act (Geneva Act) of the Hague Agreement Concerning the International Registration of Industrial Designs (Hague Agreement) with the World Intellectual Property Organization (WIPO). With this final step by the United States to become a signatory to the Geneva Act, qualifying U.S. applicants will be able to more easily protect their design patents in member countries and intergovernmental organizations (Contracting Parties) that have also signed on to the Geneva Act.

Specifically, the registration system (the Hague System) allows a qualifying applicant to file a single application, under a single fee structure with up to 100 industrial designs, in order to apply for protection under the laws of any one of the contracting parties designated by the applicant. Examination of the design application remains subject to each designated contracting parties’ rules. As such, notwithstanding the ability to include up to 100 designs on an international application, applicants filing in the United States for a design patent are permitted a single design invention per application, which may include multiple embodiments. Embodiments determined to be unique designs may require divisional applications and consequently, additional filing fees. The United States Patent and Trademark Office’s (USPTO) rules governing the processing and examination of design patents filed under an international application will go into effect on May 13, 2015, and publication in the Federal Register will follow the United States’ ratification to the Geneva Act.

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