The Federal Circuit recently asked the government to submit an amicus brief to address “what, if any, deference should be afforded to decisions of a Patent Trial and Appeal Board Precedential Opinion Panel (‘POP’), and specifically to the POP opinion in Proppant Express Investments, LLC v. Oren Technologies, LLC, No. IPR2018-00914, Paper 38 (P.T.A.B. Mar. 13, 2019).” Order, Facebook, Inc. v. Windy City Innovations, LLC., No. 2018-1400 (Fed. Cir. Aug. 12, 2019).
In 2018, the Director of the Patent and Trademark Office created the Precedential Opinion Panel, which typically comprises the Director, the Commissioner for Patents, and the Chief Judge of the PTAB. The POP may be convened to rehear matters that are of exceptional importance, or to assist the Director in deciding whether a PTAB decision should be designated as precedential or informative.
The specific POP decision the Federal Circuit cited, Proppant Express, addressed “whether 35 U.S.C. § 315(c) permits a petition to be joined to [an IPR] proceeding in which it is already a party.” If an alleged infringer intends to seek IPR of the patent, it must file its petition within one year of being served with the complaint. After filing, Section 315(c) permits “the Director, in his or her discretion, [to] join as a party to that inter partes review any person who properly files a petition under section 311 that the Director, after receiving a preliminary response under section 313 or the expiration of the time for filing such a response, determines warrants the institution of an inter partes review under section 314.” 35 U.S.C. § 315(c).
In Proppant Express, the PTAB POP held that Section 315(c) allowed the Director to join the petitioner itself as a party beyond the one-year deadline. In practice, that interpretation of 315(c) allows a petitioner to join issues that would otherwise be time-barred. Different PTAB panels had previously split on whether the petitioner could use “same party” joinder to add additional issues to the IPR. Also, the Federal Circuit had expressed doubt that “Congress intended that petitioners could employ the joinder provision to circumvent the time bar by adding time-barred issues to an otherwise timely proceeding.” Nidec Motor Corp. v. Zhongshan Broad Ocean Motor, 868 F.3d 1013, 1017 (Fed. Cir. 2017).
The government filed its amicus brief with the Federal Circuit on September 17, 2019, arguing that any POP decisions interpreting the America Invents Act (“AIA”) are entitled to Chevron deference. In United States v. Mead Corp., 533 U.S. 218, 227-29 (2011), the Supreme Court held that an agency is usually afforded Chevron deference when Congress delegates the authority for “rulemaking or adjudication.” According to the government, the AIA delegated authority to engage in both rulemaking and adjudication. First, the AIA authorized rulemaking by permitting the Director to enact regulations to establish and govern the IPR process. Second, the AIA authorized adjudication by enabling the Director to adjudicate the IPRs. Thus, according to the government, the Director is entitled to Chevron deference when interpreting statutory provisions of the AIA, including Section 315. The government further argued that the PTAB POP’s decision in Proppant Express should not be reversed under a Chevron deference review.
The Federal Circuit invited the parties to file a response to the government’s amicus brief, which are due October 1, 2019. The Federal Circuit’s resolution of the issue could have a profound effect on future review of all PTAB POP decisions.
When the Supreme Court opens its new session on Oct. 7, one of the cases it will determine, Romag Fasteners, Inc. v. Fossil, Inc., et al. Case No. 2018-2417, is expected to resolve a stark difference among circuits over when a trademark owner is entitled to disgorgement of an infringer’s profits due to an infringing use of a mark.
On August 29, 2019, the Director of the USPTO notified the Trademark Public Advisory Committee (TPAC) of the Office’s intent to set or adjust trademark related fees and submitted a preliminary trademark fee proposal for comment. There are multiple timelines for public debate and comment on the proposed new fees, with a tentative implementation date of August 2020. While most proposed fee changes are relatively modest ($25 – $75 for new electronic filings, per class; $125 for Section 8&15 declarations, per class), many remain unchanged (such as Section 8&9 renewals). Nonetheless, the additional costs could be significant for companies with large portfolios. We will continue to keep you apprised of developments in this area including the exact date for implementation of the new fee schedule if/when the new fees are approved.
On July 23, 2019, the Federal Circuit departed from its utility patent-focused docket to deliver a precedential opinion relating to design patents in Auto. Body Parts Ass’n v. Ford Global Techns., LLC. At issue were the validity and enforceability of design patents on automotive repair and replacement parts. The case arose from a filing by the Automotive Body Parts Association (ABPA) in the Eastern District of Michigan seeking declaratory judgment of invalidity and enforceability of two design patents relating to the hood and vehicle headlamp of the Ford F-150. The ABPA moved for summary judgment, but the District Court entered judgment sua sponte in favor of Ford. The case was taken up on appeal.
I. Introduction
In two opinions issued in the past few weeks, the Federal Circuit has shaken up two requirements of the reissue statute that most practitioners don’t think about much. 35 USC 251(a) authorizes reissue of a patent “for the invention disclosed in the original patent.” 35 USC 251(c) provides that “[t]he provisions of this title relating to applications for patent shall be applicable to applications for reissue of a patent,” which includes the written description requirement of 35 USC 112(a). The “conventional” wisdom up to now has held that these requirements are more or less synonymous (and not considered arduous). Now, we aren’t so sure.
The language of the patent damages statute, 35 U.S.C. § 284, appears straightforward – “[u]pon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer” (emphasis added). The common reasonable royalty calculation multiplies a royalty base by a royalty rate to yield a damages award. While the math seems simple, determination of a reasonable royalty in the context of devices that have hundreds, perhaps thousands, of components and functionalities is an endeavor ripe for chicanery. See Grain Processing Corp. v. Am. Maize–Products Co., 185 F.3d 1341, 1350 (Fed. Cir. 1999) (“To prevent the hypothetical from lapsing into pure speculation, [the] court requires sound economic proof of the nature of the market and likely outcomes with infringement factored out of the economic picture.”).
