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  • The opinions, commentary and characterizations provided to this online forum by the authors and moderators are provided for encouraging discussion, thought and debate on important post grant issues. These postings are in no way representative of the opinions of Oblon Spivak et al., or its clients.

Archive for the ‘Stay or Dismissal of Litigation’ Category

CAFC Reverses EDTX on Second Guessing of PTAB

Posted On: Jul. 11, 2014   By: Scott A. McKeown
CBM-stayEDTX Denial of CBM Stay Deemed Abuse of Discretion

Back in March I recounted the curious case of VirtualAgility Inc., v. Salesforce.com Inc., et al. (EDTX). In this dispute, Salesforce.com sought a stay of the EDTX litigation pending Covered Business Method (CBM) review of the VirtualAgility patent. The CBM petition was filed with the USPTO Patent Trial & Appeal Board (PTAB) on May 24, 2013 as CBM2013-00024.

The EDTX determined that a stay was unlikely to simplify the issues for trial based upon an independent assessment of the CBM. This was despite the fact that the PTAB went forward with the CBM (i.e., determined that all of the claims were more likely than not unpatentable on multiple grounds), and the patentee had already amended their claims. Thereafter the case was effectively stayed anyway pending interlocutory appeal to the CAFC (a right newly provided by the CBM statute). Read the rest of this entry »

Pay to Stay….The Game Changing Impact of Business Method Patent Challenges

Posted On: Oct. 11, 2012   By: Scott A. McKeown
CBM_PTABNew CBM Challenges to Derail Business Method Patent Assertions?

Last September 16th marked the one year anniversary of the enactment of the America Invents Act (AIA). This “patent reform” legislation introduced several new post grant avenues to challenge an issued patent at the USPTO. One of these new options is the very specialized, Transitional Program for Covered Business Method Patents, or “CBM” proceeding.

The CBM option is noteworthy in several respects: first, it is a post grant review challenge that is limited to a special class of patents (i.e., “covered business method” patents); second, only those challengers that have been sued or charged with infringement of a covered patent may petition the USPTO to initiate a CBM proceeding; third, the estoppel is limited to those grounds actually raised in the proceeding (that is, there is no “reasonably could have raised” estoppel); and finally, the CBM statutes include unique controls that virtually ensure that any ongoing litigation at the time of a CBM filing will be stayed pending USPTO review.

As explained above, the CBM proceeding presents an insignificant of estoppel risk. This “free shot” combined with the near certain stay of costly court proceedings presents a “pay to stay” opportunity that qualifying defendants may find hard to resist.

Read the rest of this entry »

Horse Trading: Trends in Stays Pending Reexamination

Posted On: Oct. 20, 2010   By: Scott A. McKeown
smhorsetradinThe Emergence of Patent Reexamination as a Litigation Bargaining Chip

As discussed last week, defendants may opt to creatively present their motion for stay pending patent reexamination to increase the likelihood of a favorable district court determination. This tactic appears to be gaining traction as more defendants seek to reap the benefits of a concurrent patent reexamination.

In order to adapt to the defendants “sweetening of the deal,” plaintiffs are now finding themselves forced to do a bit of bargaining themselves. In Software Rights Archive LLC., v Google Inc., AOL LLC, Yahoo! Inc., IAc Search & Media, Inc., and Lycos, (NDCA) the court has seemingly mediated a bargain, and in the process, simplified issues for trial. Read the rest of this entry »

CAFC Applies The Wrong Claim Interpretation Standard in Patent Reexamination

Posted On: Apr. 15, 2010   By: Scott A. McKeown
suitcosurfaceinc-logobutton copyIn re Suitco Surface, Inc. (Fed. Cir. 2010)

Yesterday, the CAFC issued a decision in ex parte reexamination 90/007,015 appeal (U.S. Patent 4,944,514). The decision (In re Suitco Surface Inc) is interesting in that the broadest reasonable interpretation of the USPTO was reversed as clearly unreasonable, yet that is the least interesting aspect of the case. In deciding the case, both the BPAI and CAFC applied the wrong standard altogether.

As background, the patent relates to a flooring surface for use on athletic courts, namely bowling alleys and shuffleboard. The key term in dispute being “material for finishing the top surface.” The Patent Holder insisted that the material for finishing the top surface must be defined as the uppermost surface. The USPTO countered that the broadest reasonable interpretation did not require an uppermost surface, but simply the finishing of a general floor surface (such as the lower layer of a laminate type floor). The USPTO reasoned that the term “comprising” is open ended and additional floor layers were possible.

In reversing the BPAI, the CAFC noted that:

“[t]he PTO’s construction here, though certainly broad, is unreasonably broad. The broadest-construction rubric coupled with the term “comprising” does not give the PTO an unfettered license to interpret claims to embrace anything remotely related to the claimed invention. Rather, claims should always be read in light of the specification and teachings in the underlying patent. See Schriber-Schroth Co. v. Cleveland Trust Co., 311 U.S. 211, 217 (1940) (”The claims of a patent are always to be read or interpreted in light of its specifications.”). In that vein, the express language of the claim and the specification require the finishing material to be the top and final layer . . .”

The CAFC determined that claim 1 was unreasonably interpreted based on the USPTO claim construction of “material for finishing a top surface.” However, the CAFC affirmed the rejection of claims 4 and 6 based on a broadest reasonable claim construction of the terminology “uniform flexible film.”

While the CAFC’s emphasis on specification context for reexamination is certainly noteworthy, lost in the appeal to both the BPAI and CAFC is that the broadest reasonable interpretation standard is not applicable to the Suitco Patent. This is because Read the rest of this entry »

ROY-G-BIV Corporation

On April 14, 2009, USDJ David Folsom issued an order denying Defendant’s, Fanuc Ltd., et al, motion to stay litigation pending the outcome inter partes and ex partes reexamination of patents-in-suit: 3 inter partes, 1 ex parte. ROY-G-BIV Corp. v. FANUC Ltd. et al., No. 2:07-CV-418 (E.D. Tex., April 14, 2009)
Judge Folsom decided whether defendants, having waited a full year after the suit was filed to request reexamination coupled with the additional delay of lengthy reexamination proceedings, would be unduly prejudicial to Plaintiff. Relying on Institute for Progress analysis of the inter partes reexamination process, the judge projected that the stay could last twenty-eight months at a minimum. The trial date, less than six months away, had been set. These two factors coupled with the likelihood that a stay would force the parties to redo a significant amount of their claim construction briefing, “weigh heavily against granting the stay,” under Judge Folsom’s analysis.
That the reexamination may simply the issues “is difficult to gauge,” according to Judge Folsom the early stage of the reexamination process and the uncertainty of cancellation or modification of claims through amendment. “Furthermore,” writes the Judge, “it is this Court’s experience that the reexamination process may actually complicate a case by creating additional prosecution history estoppel and disavowal arguments that must be addressed during claim construction.”
Finally Judge Folsom noted that although discovery was not complete, claim construction briefing is complete, and trial is six months away.
Accordingly, Judge Folsom denied Defendant’s motion.

On April 14, 2009, U.S. District Court Judge David Folsom issued an order denying a Fanuc Ltd., et al motion to stay litigation pending the outcome of three inter partes and  one ex partes reexamination regarding US Patents. ROY-G-BIV Corp. v. FANUC Ltd. et al., No. 2:07-CV-418 (E.D. Tex., April 14, 2009).

Judge Folsom decided whether defendants’ actions, having waited a full year after the suit was filed to request reexamination, in light of the additional delay of lengthy reexamination proceedings, would be unduly prejudicial to Plaintiff. Relying on analysis from the Institute for Progress regarding the inter partes reexamination process, Judge Folsom projected that the stay could last twenty-eight months at a minimum. Judge Folsom found this lengthy projection unfavorable especially because the trial date had been set for less than six months away.  Judge Folsom also cited the likelihood that a stay would force the parties to redo a significant amount of their claim construction briefing to “weigh heavily against granting the stay.”

Judge Folsom was not convinced the reexamination would simplify the issues in the dispute citing the early stage of the reexamination process and the uncertainty of cancellation or modification of claims through amendment. “Furthermore,” wrote the Judge, “it is this Court’s experience that the reexamination process may actually complicate a case by creating additional prosecution history estoppel and disavowal arguments that must be addressed during claim construction.”

Judge Folsom concluded that although discovery was not complete, claim construction briefing was complete, and trial is six months away.  Accordingly, Judge Folsom denied Defendant’s motion.