Hello all,
We are only weeks away from the US Thanksgiving holiday which officially kicks off the holiday season and often represents the last push to close deals before yearend. Apparently, both the judiciary and legislature decided it was a good time to get to work as there has been a flurry of activity on those fronts. More specifically, there is a newly proposed bill on the Hill in need of a co-sponsor that could massively impact the eBay decision from the Supreme Court (remember the eBay decision essentially all but eliminated injunctive relief for patent owners in the US). More below.
I have some thoughts on the recent and quite interesting patent litigation trends and I’ll discuss the current status of the PREVAIL Act that aims to reform the PTAB and why US Inventor, which normally should support its adoption, has called it a sham process, urging its demise.
Finally, we also have a great summary of where we stand on patent eligibility (aka 101) prepared by our VP of Technology Alan Burnett who has been tracking this topic very closely. We also discuss how inconsistent the Federal Circuit has been on some identical topics, making it so hard to predict how to draft and prosecute patents.
As usual, as I focus on the macro picture in this newsletter, I want to remind everyone that we track everything that is going on in this world and for those who need their regular dose of news, once again you can follow me on either LinkedIn or Twitter where I post almost daily about some of the most newsworthy events.
Happy reading!
Louis
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Tangible IP News
For those who missed the announcement last month, we would like to share that our CEO has been named for the 12th consecutive year as one of the world’s leading IP strategists by IAM magazine. Our VP Brokerage, Erika Warner also made this prestigious list for the first – and certainly not the last – time. Full details here.
Louis was recently the guest of CIPU’s own Bruce Berman’s podcast along with former IBM head of IP, Bill Lafontaine, for a lively discussion around the theme of: ”Understanding IP Matters: Making Innovation Pay.” IP Watchdog wrote a nice summary of the discussion.
We are also pleased to formally announce the recent sale of a portfolio in the air filtering sensor technology space. See the full announcement here. Furthermore, we have officially closed the sale of a portfolio in the data storage space as well. A formal announcement will follow soon.
We also have several other portfolios for sale that offer great opportunities to savvy buyers. All of our patents for sale are listed here. Similarly, if you’d like to be added on our distribution list in the future so that you are the first to receive new opportunities, please email us at info@tangibleip.biz.
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Patents Wanted
Call for high quality portfolios!
We are always open to reviewing high quality portfolios. Some of the areas of most interest to our buying network right now include:
- Video compression SEPs and/or video streaming
- Block Chain related assets
Medical Device technology – particularly wearables and IOT health monitoring
- Patents applicable to RFID tags, RFID Antennas, RFID readers and Near Field Communication (NFC) devices.
- SEPs (Declared or not) relevant to any of the following: 3GPP, 802.11, LTE, 5G
You can review our criteria here but if you own a patent portfolio with at least two issued US patents and have knowledge of others using your technology (infringement), we are happy to review for potential brokerage. We will also look at larger portfolios where evidence of use is uncertain.
Please reach out to info@tangibleip.biz with any assets that may match these requests.
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Recent News:
Patent Litigation Trends
The behemoth insurer Aon, who offers various IP related products, recently published a report showing the latest trends in patent litigation.
The key takeaways are as follows:
- Lessons were learned in late 2022 where, despite decreased patent cases, the proportion of suits filed by non-practicing entities (NPEs) reached a seven-year high.
- The upward trend in damages awarded signifies a higher risk for companies.
- Intellectual property insurance coverage continues to improve, trending towards increased capacity, and stabilizing pricing.
New cases declined from 4,006 in 2021 to 3,829 in 2022, a modest 5% drop. But new cases in 2023 are currently at 1,539 in H1 compared to 1,958 last year for the same period. This trend is much more significant. (It is worth noting that two of the more prolific filers, IP Edge and Cedar Lane, had decreased filings during H1 and it would be interesting to see if the decrease correlates.)
In 2022, NPEs filed 63% of cases, the highest percentage of NPE suits since 2015. In H1 2023, roughly 51% of cases were filed by NPEs, which is significantly higher than the proportion of NPE suits in H1s over the past 10 years.
It is also interesting to see how patent suits are being distributed among the various technology domains:
(Source: AON)
Finally, despite fewer cases being filed, damage awards were on the rise; more damages awards were won in H1 2023 than in previous years’ first halves: 49 damages awards were handed down in H1 2023 versus 31 in 2022 and only 28 in 2020, a low number likely due to court closures during the onset of the COVID-19 pandemic. There were five damages awards of $100 million or more in H1 2023 — this is the highest number of awards in the first halves of the past nine years.
The Meaning of “A”
District Courts have accustomed us to some discrepancies between decisions on related topics given that they are conducted by one judge and facts play an important role in each decision. But we recently saw the probable epitome of what currently plagues our patent system creating uncertainty and unpredictability throughout when the Federal Circuit, sitting on appeal, came to two completely and contradictory decisions on something as simple as defining the word “A” in a patent.
Specifically, within the span of six days, the Federal Circuit held that:
“A computer” means one and only one computer when a subsequent claim element recites “the computer” (Finjan v. Sonicwall); and
“A sample stream” means one or more sample streams when a subsequent claim element recites “the sample stream” (ABS Global v. Cytonome/ST).
And we are supposed to trust them with the legal process. It doesn’t get any worse than that…
Putting eBay at Bay
When you ask patent experts to highlight an event that most significantly pushed the pendulum away from strong patent rights (and assuming they are old enough to remember), they will not point to Alice/Mayo doctrine (101) or to the creation of the PTAB. These two milestones did of course have a significant impact. But for many, what really started the decline of patent rights holders was the day the US Supreme Court ruled in eBay vs MercExchange in 2006 noting that only in very specific circumstances could plaintiffs asserting their patents obtain an injunction to bar a defendant from selling, importing, etc. products or services deemed to be infringing their patents. This was the day that patents went from being “a right to exclude” to a simple right to claim damages from free-loaders. This was the seed that grew into pervasive efficient infringement as we know today.
Yet, a few recent decisions from the Unitary Patent Court in Europe where such injunctions have been granted have started to disrupt the status quo and accelerated the movement of patentees relying increasingly more on European courts to protect their rights against infringers. Since US politicians do not like to become irrelevant, it did not take long for Senator Coons (D-DE), the chairman of the IP committee, to make it known that he was looking for a co-sponsor to a proposed bill that now aims at reversing eBay and its progeny, thereby reestablishing patent owners’ rights to seek and obtain injunctive relief. This, it goes without saying, would be a complete game changer if it ever came to pass. It would be the gust of wind that pushes the pendulum back to where it rested before eBay, Alice/Mayo and the PTAB. One can only dream…
Why is US Inventor Bashing PREVAIL?
We discussed in our last column the details of the Promoting and Respecting Economically Vital American Innovation Leadership Act (PREVAIL) Act of 2023, proposed by the Senate IP Committee and for which there is already a House version. This bill would significantly overhaul Patent Trial and Appeal Board (PTAB) practices. Normally, advocacy groups supporting inventors’ rights should throw their full support behind it. Unfortunately, they are doing exactly the opposite and the organization is actively lobbying against the bill, on a general basis that it does not go far enough, even calling hearings about the bill a “Sham Hearing” in its November 8 mailer because they do not like the list of witnesses invited to testify. Many respected pundits who are clearly in the pro-patents camp, such as Gene Quinn and former chief judge Michel, to name a few, (while acknowledging that the bill is not perfect) admonished the organization for missing a great opportunity to move the needle in the right direction. Sometimes the best is the enemy of the good, as French writer Voltaire used to say (in French of course).
Patents 101 – A Short Guide to Understanding the Courts on Patent Eligibility
Uncertainty surrounding patentable subject matter “101” has been a lingering thorn in the side of all buyers. We see firsthand the impact of the opacity, which unfortunately affects the portfolios we can take under brokerage. Concerns regarding 101 are often a main reason we must pass on an otherwise great portfolio of patents. Here is a short summary of the current state of affairs when it comes to understanding how the courts see the patent eligibility (101) issue.
By Alan Burnett, VP Technology, Tangible IP
The Court of Appeal for the Federal Circuit (CAFC) recently issued two opinions addressing patentable subject matter under 35 U.S.C. § 101. In USC IP Partnership, L.P., v. Meta Platforms, Inc., the Court found that claims directed to a method for predicting an intent of a visitor to a webpage to be invalid as claiming abstract subject matter. The district court held that the intent engine “is a purely functional ‘black box’ implemented using standard cloud platforms from well-known vendors.” The Court found, “The claimed concept of collecting and using intent data is not a technical solution to a technical problem, unlike the concept claimed in DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014).
In the precedential opinion issued for Trinity Info Media v. Covalent, Inc., the Court found claims “directed to a poll-based networking system that connects users based on similarities as determined through poll answering and provide real-time results to the users” as invalid under § 101 and confirming Trinity’s amended complaint was properly dismissed. The district court found the asserted claims were directed to the abstract idea of “matching users who gave corresponding answers to a question” and did not contain an inventive concept. The Trinity case addressed the need for claim construction and fact discovery is needed to be conducted before analyzing claims under § 101. Trinity failed to propose a construction nor identify specific facts that would be discovered that would change the outcome.
In both cases the Court applied the familiar Alice/Mayo Step One and Step Two analysis. Step One determines whether the claims are directed to a patent-ineligible concept, such as an abstract idea. At Step Two, we “consider the elements of [the] claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.” If the subject matter is determined under Step One to be directed to a patent-eligible concept, the analysis ends, and the claims are valid under § 101. In these and other cases the CAFC has continued to emphasize the importance of an improvement to (computer) technology, or otherwise claiming a technical solution to a technical problem that doesn’t employ conventional, well-known, are/or routine components and methods.
What the CAFC has yet to definitively rule on is whether the claims themselves need to describe the technical solution or improvement and/or where that line might be drawn. It appears clear that if the patent specification and drawings do not provide sufficient description and/or illustrations disclosing a technical solution the claims will not be patent eligible. What happens when a patent provides substantial description disclosing a technical solution or improvement to computer technology, but the claims do not explicitly claim how that solution/improvement is implemented remains an open question, although it appears the Court is leaning in the direction of having explicit support in the claims themselves.