EU Pundit : Issues of the European Union

No Patents for Human Genes Rules U.S. Supreme Court in a Decision Impacting EU Genetic Research

2013-06-13T21:30:00.002+02:00

In a unanimous opinion that will also impact genetic research in the European Union, the United States Supreme Court has held that human genes are not patentable.

Adam Liptak has the story at the New York Times in
Supreme Court Rules Human Genes May Not Be Patented

See also Lyle Denniston at SCOTUSblog in
Opinion recap: No patent on natural gene work

See Max Mallory at SCOTUSblog on
Round-up of news on today's opinions

LawPundit has been right all along on this case.

Why the Tiny Village Baiersbronn in Germany's Black Forest Has Seven Michelin Stars

2013-05-31T13:09:00.000+02:00

Does good food provide the missing key to good national economics?

In this vein, Nicholas Kulish at the New York Times has a fascinating article on One Tiny German Town, Seven Big Michelin Stars.

Why does the United States have just about as many Michelin 3-star restaurants as Germany, even though America has four times the population?

Is there a lesson from the food industry here for the economy in general?

In Germany, not just the food, but almost everything "works", not necessarily so in other places.

Is the system of training an integral part of German success?

We previously posted at LawPundit giving some reasons why Germany may be so successful economically.

One aspect is to examine the advantages of an apprenticeship system.

The glut of Michelin stars at Baiersbronn is a good example.

As Kulish writes:

"In his last State of the Union address, President Obama said America should emulate Germany’s knack for producing skilled workers — “high-school students with the equivalent of a technical degree from one of our community colleges.” He was referring specifically to fields like engineering and computer science, but he could just as easily have been talking about high-end cooking. In the same way that Germany succeeds at making drills and luxury automobiles, the country’s apprenticeship process is successfully creating top restaurants.
. . .
The dual-training system is evidence of the close cooperation between business, the state and workers that helps account for Germany’s success, both in niche industries and big multinational enterprises like Siemens and Mercedes. Vocational schools, usually offering a course of study lasting between two and three and a half years, are financed and run by the states. Would-be apprentices apply not to the schools but to businesses, which decide how many future employees they need to have trained. Some specialties have national academies: aspiring hearing-aid technicians go to Lübeck, for example; piano builders to Ludwigsburg."

The bottom line is competence at all levels of industrial society.

Hat tip to CaryGEE.

Receipts in Your Gmail: Find by Entering a Hidden Smart Label in the Gmail Search Box

2013-05-31T12:25:00.001+02:00

For users of Gmail,
Alan Henry at LifeHacker has a valuable tip and detailed discussion
about a smart label search for receipts in your Gmail.

See
Find Receipts in Gmail with This Hidden Smart Label.

The trick is to enter

label:^smartlabel_receipt

in the Google search box at the top of Gmail.

It will not work if you just plug it into normal Google search.

Hat tip to CaryGEE.

Germany Switching from Austerity to Stimulus in Europe: Why the Germans Dominate Among European Economies

2013-05-27T21:52:00.000+02:00

Cowboys on the Rhine?

Make sure you read that article to find out why the American employee system of master-servant is inferior to the German system of master-apprentice, at least in Germany.

I am not German, so I feel free to write this as my honest opinion.

Paul Krugman, who has been the loudest and most consistent economic voice of rank against German austerity must be dancing in the street today in view of the report by Sven Böll and Christian Reiermann in today's SPIEGEL ONLINE titled:

Austerity About-Face: German Government to Gamble on Stimulus

Apparently, German Chancellor Angela "Angie" Merkel's government has decided to open some of Germany's vast financial resources to help get Europe's stagnant economy back on track.

Mere money, in our opinion, however, may not be enough long-term to solve some of Europe's most vexing structural economic problems, as many of Europe's "traditionally-oriented" nations ("backward" may be a better term) must start considering modern economic entry into the 21st century, rather than living on the glories of nostalgic histories long past.

Why is the rest of Europe behind Germany economically?

Well, I live here, and I can give you a personal insight as to why it is so.

Consider the following true story:

A number of years ago I worked for a large German conglomerate that had invited a number of young whiz kids from the British Isles to work on liquid crystal displays in the early days of that technology.

A young Englishman from Poole of that group, with whom I became friends in the course of time, confided to me his astonishment at the great number of people who started work at 6:30 a.m. in the German company, an early working start to the day enabled by "flexitime".

"It is really quite astonishing," he said, "at the same hour when Germans are on their way to work here in the morning, in London not even the streetcars are running."

Similar true stories can be related about the United States. I have known German workers in the building professions who have gone to America on vacation and marveled at American inefficiency:

"what they do in 5 days, I do in 3".

Well that is what I have been told.
I can not vouch for its truth. It might be true in some industries.

People in America and elsewhere who envy the Germans their 6 weeks of paid vacation a year, should rather take a look at what the Germans do the REST of the time. I know of no harder-working, more efficient people, as a whole.

Germany's economic dominance in Europe is a product many things, but one of the main factors is simply that they are a very hard-working people, and they often do that work with near exemplary efficiency, and intelligence.

"Hype" does not run an economy. Performance does.

Germany is not the only example for that economic truth.

Look at China or South Korea.

The breathtaking advance forward of these nations should be no surprise to those who have looked more carefully at their peoples.

When I worked in New York City in my early legal days many years ago, I had my shirts and suits cleaned regularly at one of the near Chinese laundries in Manhattan. I brought the clothes early in the morning and picked them up late in the evening, ALWAYS on the same day. Everything was cleaned and ironed perfectly. An entire larger family worked in that Chinese business.

I marveled then at the tremendous work ethic that Chinese laundries demonstrated and wondered way back then what would happen if then Red China decided to join the capitalist world.

Well, today we know.

An America that for several hundred years has touted the benefits of hard work must now face the fact that most of the world's products, including their own, are often made overseas, in places like China, or in South Korea, etc. Others are working HARDER.

But of course, the American way of economic life has not thereby failed.

Quite the contrary, it has been successfully exported and other nations and peoples are IMPROVING upon it.

Just look at the battles between the company Apple in the USA and Samsung in South Korea. Frankly, in my opinion Apple has no sustainable competitive chance of survival in the long-term. They manufacture virtually nothing themselves and most of their product components are made in Asia. A company or nation can not live simply from patent-trolling.

The hard American lesson of hordes of lost industries overseas also applies to the countries of Europe envious of Germany's modern economic successes.

There is no alternative to growth, and, in the long term, there is no substitute for hard work, done efficiently, and intelligently.

The core idea of capitalism is competition. That competition is not only between individuals, and not only between companies. It is a competition also being waged between states, nations and systems.

Who is winning?
Well, what do YOU think?

Eurovision 2013 Song Contest Semifinals and Final Upcoming in May 2013: Subjective Impressions in April: Who Could Win?

2013-04-24T22:00:00.001+02:00

The Final of the Eurovision 2013 Song Contest is upcoming May 18, 2013 in Malmö, Sweden. Semi-Final 1 is on May 14 and the Semi-Final 2 is on May 16.

Who will win the actual song voting? The juries and TV voters will decide.

Right now, it appears to be a question of "can anyone beat Denmark?"

Our own TOP TEN, after Denmark, are, IN ALPHABETICAL ORDER only and not in the order we would vote: Croatia, Germany, Ireland, Moldova, Montenegro, Netherlands, Russia, San Marino, Ukraine, United Kingdom.

Below are a few of our subjective impressions of the competing songs, music, lyrics and artists.

We have our own personal favorites, of course, in our own top ten above, but we have greatly enjoyed listening to all the songs and reading about the music makers from each country. Thank you to all. Each entry has something interesting to tell, even if it does not emerge as the ultimate winner.

The Eurovision Song Contest is only in part about winning and losing. More importantly, it is about culture and music among the European family of peoples. This unique event fosters a common sense of heritage and identity in Europe and is always of interest for that reason, much as sports often serve a similar purpose for the community of humankind at international events like the Olympic Games.

Sometimes winning is overemphasized, or, to put it another way, nearly everyone in Europe "wins" through the Eurovision Song Contest.

One thing to remember is that official videos of the entries -- to which we link below -- can often be better than the on-stage performance at the Eurovision Song Contest, where one has to sing "live", and it is the latter which is determinative, so one can not rely solely on the videos to gain an accurate view of the chances of an entry in the contest. The day of competition is determinative.

Countries Exempt from Semi-Final Competition and Automatically Qualified for the Final

SWEDEN (last year's winner with Euphoria by Loreen)
Sweden - Robin Stjernberg - You
Stjernberg! Although we tended in favor toward La La Love by Idi Adamou of Cyprus last year, we did also very much like Sweden's ultimate winner Euphoria by Loreen, a song that had broad appeal among voters. Sweden's 2013 song You by Robin Stjernberg is a change in style from the 2012 winner, and comparable success in 2013 for Sweden is unlikely.

GERMANY: Teutonic Eurodance
Germany - Cascada - Glorious
Eurodance! We are fans! The Eurodance song Glorious by Cascada has several million hits online already at YouTube, surely many from the great number of devoted fans in Germany. We like this song because its theme concentrates with optimism on the youth of our time and their future. However, Eurodance has historically not done well at the Eurovision Song Contest. This year should be an exception, but Cascada is unlikely to garner sufficient votes throughout all of Europe to win. Being from Germany, we nevertheless say "toi, toi, toi", which means "good Luck!"

UNITED KINGDOM: Bonnie Tyler (!) in the prime of life!
United Kingdom - Bonnie Tyler - Believe in Me
Oldies but goodies! Bonnie Tyler and her special voice and song have enriched the lives of millions over the years. Bonnie is now 61 and is unlikely to win the Eurovision Song Contest, just as the famed Engelbert Humperdinck, age 76, last year did not win for a nostalgic, traditional United Kingdom. Nevertheless, Bonnie is a great addition to the Eurovision spectacle, regardless of the voting. Go, Bonnie, go!

FRANCE:
France - Amandine Bourgeois - L'enfer Et Moi ("Hell and Me")
50 Shades! The French entry merges a young female pop rock singer with a song that relates to BDSM and, in the video to the song, shows various pictured subjects of the macabre, we suppose all intended in the trend of the immensely popular risque book series 50 Shades .... Voters will have to decide how this borderline toxic mixture fares at Eurovision.
ITALY:
Italy - Marco Mengoni - L'Essenziale

described

SPAIN: Back to Celtic Roots
Spain - ESDM (El Sueño De Morfeo) - Contigo Hasta El Final (With You Until the End)
Celtic! Spain presents a sweet song and a fittingly sweet lead female singer and presentation. The song has not been a sales magnet in Spain since its debut, so that a high placement at the Eurovision Song Contest would be a surprise, but it is not excluded.

Semi-Final 1, May 14, 2013, Malmö, Sweden
Pre-Contest Impressions

AUSTRIA: The Starlit Sky Shines
Austria - Natália Kelly - Shine
Shining! 18-year old Natália Kelly represents Austria with her debut single. She is of Austrian ancestry and has roots in the USA and Brazil as well, showing the international nature of the Eurovision Song Contest. "Shine" is a breathy pop-type song that will give Kelly's singing career a boost.

ESTONIA: Continues Tradition of Solo Singers, but as a Duo
Estonia - Birgit Öigemeel - Et Uus Saaks Alguse
A Duo as One! Birgit is a female singer with a nice voice who sings a pleasant song the translated title of which is "New Beginning", an idea that incorporates her expecting, pregnant status. Something new for Eurovision. Why not?

SLOVENIA: Female Singer with a typical Eurovision Song
Slovenia - Hannah Mancini - Straight into Love
Mancini is a name of fame in music! This zippy dance song is sung by Hannah Mancini, who was born in America, but is married to a Slovenian, showing once again the broad international flavor of Eurovision. Mancini has appeared on the Jay Leno show in the USA and previously worked in Hollywood on Disney films soundtracks.

CROATIA: Top Harmony, Melodious Song in the "Old Style"
A Musical Challenger in Accession mid-2013 to the EU
Croatia - Klapa s mora - Mižerja (Misery) -- see lyrics
The darkhorse challenger! We really like this entry for its sheer musicality. "Misery" is melodious and soulful music in the "old" tradition, and should have a strong following among older generations, which could translate into a strong showing at Eurovision. We expect a lot of votes here from Eastern Europe, which could give Croatia a high placement, maybe even a win.

DENMARK: Wonderful Musical Talent and Performing Art
The Clear Early Betting Favorite Thus Far
Denmark - Emmelie de Forest - Only Teardrops
Perfect! Nearly everything about this song is perfect: song, singer, musicians, costumes, performance, yes, even "a royal touch".The Wikipedia writes about the singer: "Emmelie de Forest [is possibly] the great-great-grandchild of Queen Victoria, as her grandfather, Count Maurice Arnold de Forest supposedly was an illegimate child of King Edward VII." Her grandfather married into the Swedish nobility (Armfelt family)."
We definitely agree that this fabulous song must be viewed as the favorite. It dances in one's head for days after hearing it several times. Denmark must worry, however, that voters could find this song somewhat similar to last year's winner and the crowd may be in the mood for something different. It is also clear that this is a "Eurovision" song but may not be a musical piece that tops radio charts or YouTube song hits. Hence, a win by favored Denmark is by no means guaranteed.

RUSSIA: A Surprisingly Soft Song with a Sweet Message
Russia - Dina Garipova - What If
What a Soft Song! Human talent has no geographic boundaries. Dina Garipova not only represents Russia but is from the lesser known city of Zelenodolsk in the Republic of Tatarstan. The budding journalism student at Kazan University has a superb female voice and presents a moving, emotional song that should find many adherents. The bookmakers have Russia in the top 6 for Eurovision 2013 and that should not be far off the mark.

UKRAINE: Fantastically Done from the Central European Plains
Ukraine - Zlata Ognevich - Gravity
Ready for Hollywood! The song "Gravity" is presented by Zlata Ognevich, a top female singer, together with superb backups, a great song and excellent lyrics. This presentation has bounce and élan and is Broadway and Hollywood ready. The magic-bubbled Disney-like unicorn and butterfly video is "cool". Make sure you see it. We doubt if "Gravity" can gain enough votes to win against this year's very strong competition, but it should do well.

NETHERLANDS: Dutch superstar Anouk with a love ballad titled Birds
Netherlands - Anouk - Birds
When "for the birds" is good! The Dutch song entries have struggled at Eurovision in recent years and in 2013 the Netherlands now sends their superstar Anouk Teeuwe into the contest. Her unusual song "Birds" adds color to the Eurovision musical spectrum. The entry is perhaps too unique to capture enough excitement among voters in all countries, but it may do well regionally. In any case, well worth a listen.

MONTENEGRO: Putting a Country on the Map
Montenegro -- Who See -- Igranka
The winning video! This entry has bounce. Who knows exactly where Montenegro is located by geography and can identify its neighbouring countries? Montenegro is not well known, but their spicy rap song "Igranka" by the hip-hop duo "Who See" viz. "Who See Klapa" will surely help to put the country on the map -- if not the song, then surely the racy video that accompanies the song, which at this date already has over 1 million online hits. Win or lose, Montenegro raps!

LITHUANIA: Indie Rock Spin-Off
Lithuania - Andrius Pojavis - Something
Something, in the shoes of love and faith! The song "Something" appears to be in the style of "something" that reminds this observer of a popular "indie rock" group. The lyrics have the singer/songwriter wearing the shoes of love and faith.

BELARUS: A Question of Songs
Belarus - Alyona Lanskaya - Solayoh
Oriental! Belarus presents a song with a definitely Oriental beat that may find it difficult to garner sufficient votes in all European countries. Alyona Lanskaya originally won the Belarus final with the entry Rhythm of Love, later replaced by Solayoh. Opinions differ on which song is "better", but neither would appear to be a strong contender for the winner's circle.

MOLDOVA: A Pasha on the Piano
Moldova - Aliona Moon - O Mie
What a Voice! Moldova has a catchy song, nicely sung by Aliona Moon (Aliona Munteanu), who last year was a backup singer for Pasha Parfeny’s team in Azerbaijan. As written at Moldova.org: "Pasha is the one who wrote the song “A Million” for Aliona and will play the piano along her song during the competition in Malmö." This song might do well in the competition, but again, who really knows. Only the voting will tell.

IRELAND: An Song in Best Irish Music Tradition
Ireland - Ryan Dolan - Only Love Survives
Irish vibes! Ryan Dolan comes on the Eurovision stage in the Irish musical tradition of rhythmic pop rock music. We liked this song better the second time we heard it, and that is sometimes a problem with voting on a song heard only once. Some songs grow on you, others are less convincing if heard again. Ireland could do well with Only Love Survives.

CYPRUS: A Female Singer with an Easy-Going Song
Cyprus - Despina Olympiou - An Me Thimase
Ballad in Greek! A sole singer singing a ballad in a language (Greek) most European voters do not speak will have a difficult time winning the Eurovision Song Contest, unless the song is stunningly original or marks an exceptional musical departure from what people know already. This is a nice song, but unlikely to enter the winner's circle.

BELGIUM: Spokenly Song-like
Belgium - Roberto Bellarosa - Love Kills
Spoken like a song! This is one of the zippier Belgian entries in recent years, having a nice beat, but that is no guarantee that this entry will do better in voting, as Belgium has struggled at Eurovision in the past.

SERBIA: Three Female Singers and an Eurovision Song
Serbia - Moje 3 - Ljubav je svuda
Terrific Trio! This is a likeable song entry with an active beat and a pleasant performance by three female singers, although there is perhaps not enough uniqueness in the song or presentation to build a winner, though the entry is a nice addition to the song contest.

Semi-Final 2, May 16, 2013, Malmö, Sweden
Pre-Contest Impressions

LATVIA: "Here we Go", "Gone" in the Semifinals?
Latvia - PeR - Here we go
Here we go, gone in the semifinals? We have Latvian ancestors, but we think this somewhat "outdated in style" song may be gone early in the competition. "Here we go" has not been rated well at all at the bookmakers and we agree that it was not the right choice for Eurovision. We would have voted for one of the other national finalists in Latvia.

SAN MARINO: Lovely Song
San Marino - Valentina Monetta - Crisalide (Vola)
Marvelous! The song, singer and presentation all mesh together well and we would put San Marino among the handfull of entries who might expect to be in the upper level of voting. Solo singers have difficulty beating out the competition because their possibilities of presentation are much more limited than larger musical groups. This song was thus a positive surprise, definitely.

F.Y.R. MACEDONIA: Eclectic Mixture
F.Y.R. Macedonia - Esma & Lozano - Pred Da Se Razdeni
Eclectic! This entry is a rather eclectic song mixture that combines elements of folk and pop into an unaccustomed array of costumes and presentation.

AZERBAIJAN: Solo Song by Male Singer
Azerbaijan - Farid Mammadov - Hold Me
Solo! Azerbaijan has produced some stunningly good entries in recent years. This year's entry takes on the difficult task of finding a male solo performance that can distinguish the singer and song from the field.

FINLAND: Song as a Matrimonial Outsider
Finland - Krista Siegfrids - Marry Me
Matrimony! This is a fun-loving entry that is perhaps a matrimonial outsider with its marriage theme. Although the tongue-in-cheek entry is likeable, it may not be placed in the top ranks of the voters.
MALTA: Simple as Music Gets
Malta - Gianluca Bezzina - Tomorrow
Simplicity! The idea of such a simple song is good, but one has to doubt that the song is catchy enough to place high in the voting. Plus points for idea.

BULGARIA: Primordial
Bulgaria - Elitsa Todorova & Stoyan Yankulov - Samo Shampioni (Only Champions)
Primordial! This primordial Oriental-tinged music is to our liking. Elitsa and Stoyan were in Eurovision in 2007 with the song Voda, which placed 5th, and we preferred that song over this year's entry.

ICELAND: Male Singer with a Quiet Ballad
Iceland - Eyþór (Eythor Ingi) - Ég á líf

GREECE: Too much Alcohol
Greece - Koza Mostra feat. Agathon Iakovidis - Alcohol is Free
Booze as a theme? We like Greek traditional music and culture, but this "alcoholic" entry is not our cup of tea at all. In the Greek national competition we would definitely have voted for ΘΩΜΑΗ ΑΠΕΡΓΗ. This does not mean that this entry will not do well.

ISRAEL: Solo Singer "Only for Him"
Israel - Moran Mazor - Rak Bishvilo
Costumes! The Israeli entry is translated as "Only for Him". There was some internal difficulty in Israel about the singer's design costume. Certainly presentation plays a role, but song and music remain paramount.

ARMENIA: About the Earth
Armenia - Dorians - Lonely Planet
Black Sabbath! Terrific song by legendary heavy metal band Black Sabbath guitarist Tony Iommi! The English-language song is sung by Gor Sujyan who, together with his band, the Dorians, were selected out of a pool of 70 applicants. It is a tune that gets better with every hearing.

HUNGARY: Alternative Music
Hungary - ByeAlex - Kedvesem (Zoohacker Remix)
One for Me is the title translation in English! It is interesting to see various musical forms tried on Eurovision, although it is difficult to know how the voting audiences will vote on this somewhat unusual entry.

NORWAY: Highly Rated by the Bookmakers but Unlikely to Win
Norway - Margaret Berger - I Feed You My Love
Norway and Norwegians! We love Norway and its people, but worry that this well-liked song could be currently ranked a bit high. The song has a top placement at the bookmakers, but it may have difficulty getting sufficient votes from all countries in Europe to occupy such a high position in the voting. Norway feeds us their love, and that is nice.

ALBANIA: A Bit of Harder Rock
Albania - Adrian Lulgjuraj & Bledar Sejko - Identitet
Law to the Fore! Adrian Lulgjuraj, the lead singer, a young lawyer by profession, is joined by Bledar Sejko on the guitar in a "hard rock" piece for Eurovision.

GEORGIA: Excellent Male and Female Duo
Georgia - Nodi Tatishvili & Sophie Gelovani - Waterfall
G:son! Goergia has a song by Swedish composers Thomas G:son and Erik Bernholm. G:son composed last year's winner, Euphoria. It was his first win, but unlikely to be repeated this year, though this is a nice song.

SWITZERLAND: Covering the Spectrum
Switzerland - Takasa - You And Me
From 21 to 95! This is an unusual musical group, as the Swiss entry ranges from 21-year-old Sarah Breiter to an Eurovision-record 95-year-old Emil Ramsauer.

ROMANIA: Hitting the High Notes
Romania - Cezar - It's My Life
Contratenor! Cezar is a contratenor viz. countertenor, i.e. someone who sings at a pitch level equivalent to a female contralto or mezzo-soprano. He sings well and the song is good, but it is difficult to know how audiences will vote on this kind of an unusual presentation.

See the videos of the songs in the competition at Eurovision 2013 at http://www.eurovision.tv.

Germany and Spain to Determine UEFA Champions League Finalists: Munich beats Barcelona 4:0 in 1st Leg of Semifinal as Madrid meets Dortumund in 1st Leg Match Upcoming Today

2013-04-24T19:52:00.001+02:00

Bayern Munich scored a sensationally decisive 4:0 win over FC Barcelona in the 1st leg of the Champions League semifinal, leaving Barcelona little chance via the 2nd leg of making it into the May 25 final at Wembley Stadium in London, though the 2nd game must still be played on the field, so no one should get overconfident.

The winner here will meet the winner of the other semifinal matches between Spain's Real Madrid and Germany's Borussia Dortmund.

The current strength of German and Spanish soccer (association football) viz. the rest of Europe is evident from the semifinal pairings.

Andrew Das has the story at the New York Times of the Bayern 4:0 win in the first leg of their match against FC Barcelona:

In Champions League, Bayern Munich Subdues a Stunned Barcelona.

Real Madrid visits at Borussia Dortmund in the 1st leg of their semifinal matches today at 8:45 p.m. (20:45) at Signal-Iduna-Park, Dortmund.

Patents on Human Genes: U.S. Supreme Court Oral Argument in Myriad Genetics Case Indicates Natural Genes Will be Found Unpatentable as a Matter of Composition but Genes Worked by Human Ingenuity May Be Patentable as to Use

2013-04-15T23:34:00.004+02:00

Oral argument on U.S. Supreme Court case 12-398, Association for Molecular Pathology v. Myriad Genetics, Inc. (see the transcript) took place today, Monday, April 15, 2013.

Essentially, it appears to us that the ultimate decision of the Supreme Court Justices in this case could fall along the following line of decision-making:

A natural human gene, i.e. DNA, is NOT patentable,
but a gene worked by human hand, such as cDNA,
could be patentable subject matter ....

That is an alternative weighed by Justice Kennedy during oral argument:

"And -- and that avoids giving special industries special subsidies, which is very important it seems to me. Let me ask you this, and it's consistent with my -- my preface. If we were to accept the Government's position that the DNA is not patentable but the cDNA is, would that give the industry sufficient protection for innovation and research? And if not, why not?"

Viewing cDNA to be patentable has two judicial options, i.e.

either

1) as "patentable" composition of matter in its own right, limited by the doctrines of prior art and obviousness, but without any monopolistic patent attaching to the actual DNA involved, whether in whole or part (i.e. snipped or unsnipped)

The problem with that option is Justice Sotomayor's question:

"Now, how do you understand Judge Bryson's dissent with respect to cDNA? I think he's saying that a gene created from -- into cDNA as a whole is okay, but that he had a problem with the description of that claim because it included 15 nucleotide long segments or fragments which he says reoccur in nature."

There is no convincing good answer to that question. Just try copying 15 notes exactly from one song into a "new" song and then try to claim you are not infringing on the original. No way.

or (the alternative which we prefer)

2) as patentable subject matter in terms of the use to which the genetic discovery, e.g. the cDNA, is put, limited by the doctrines of prior art and obviousness, but excluding its patentability as patentable composition of matter, i.e. a finding of the narrowest possible scope of patentability in the "use" of the cDNA.

Justice Sotomayor asked about the value of the isolated cDNA:

"That's the whole point, isn't it? The isolation itself is not valuable; it's the use you put the isolation to. That's the answer, isn't it?
MR. HANSEN: That's exactly correct. Thank you. Yes, that is the answer."

Justice Scalia said nearly the same thing in the argument about recombinant DNA:

"Yes. But, of course, to profit from -- from that recombinant DNA, you have to not just isolate the gene, but then you have to do something with it afterwards."

In other words, our view here at LawPundit is that DNA is not patentable subject matter, whereas cDNA could be, but only for a specific, narrow use discovered by the inventor. Nothing more. cDNA should be free for use by others for other uses, including, e.g. discovering improved tests via further research, also as regards breast and ovarian cancer, as in the case of BRCA.

No selfish lab like Myriad should ever be allowed by law to shut down competing labs engaged in genetic research just because they are using the same genes, or cDNA. Competing BRAC tests of course can not be carbon copies of the Myriad tests, but improved tests should be welcomed and encouraged, also by competing labs in the industry. That is the nature of invention and discovery and always has been, especially in the pharmaceutical and biochemical sector. Monopoly means stagnation, paid for by those who suffer needlessly. Patents should always be granted for the narrowest possible claims, not for the broadest. Monopolies should be avoided.

In general, we most closely thus accord with the basic reasoning of Justice Breyer in questioning Gregory A. Castanias, counsel for Myriad, in James Baker-like fashion [excerpted and with more paragraph division than in the original transcript], where Breyer observed:

"I had thought ... and ... I'd be interested in your view -- that the patent law is filled with uneasy compromises, because on the one hand, we do want people to invent; on the other hand, we're very worried about them tying up ... a thing that itself could be used for further advance. And so that the compromise that has been built historically into this area is:

Of course, if you get a new satisfying process to extract the sap from the plant in the Amazon, patented.

Of course, if you get the sap out and you find that you can use it, you manipulate it, you use it, you figure out a way to use it to treat cancer, wonderful, patented.

But what you can't patent is the sap itself.

Now, in any individual case that might be unfortunate or fortunate. But consider it in the mine run of things.

It's important to keep products of nature free of the restrictions that patents [trigger? ("there are" in the transcript can not be correct)], so when Captain Ferno goes to the Amazon and discovers 50 new types of plants, saps and medicines, discovers them, although that expedition was expensive, although nobody had found it before, he can't get a patent on the thing itself. He gets a patent on the process, on the use of the thing, but not the thing itself.

Now, that's my understanding of what I'd call hornbook patent law, which you I confess probably understand better than I."

Counsel countered by citing the ignominious "precedent" of USPTO practice on gene patents over the years, saying that the "decision by the Patent Office is entitled to respect", i.e. he "begs the question" by offering the thing in dispute as proof of its correctness, or, to put it into Bakeresque terms, he puts the cart before the horse. It is is an argument which in our opinon has no chance in the decision-making on this case, and, indeed, as Justice Ginsburg then correctly rebutted: "even though the Government has disavowed it".

For more about the oral argument, see e.g. Amy Howe at SCOTUSblog in Justices debate gene patenting issues: In Plain English.

See also Patently-O.

See also Greg Stohr & Susan Decker at Bloomerg in High Court Justices Seek Compromise in Gene-Patent Case.

We posted previously about the Myriad gene patent case at LawPundit in:

Can Human Genes Be Patented? U.S. Supreme Court Answer Likely to Be "No", but the Ultimate Issue Down the Road is the Patentability of cDNA (Complementary DNA) viz. Is a Split Hair viz. Split Gene an Invention?

The Unteachables on the Federal Circuit: If Citizens Are Obligated to Obey Laws They Do Not Agree With, Are Lower Courts Also Not Obligated to Follow the Precedents of the United States Supreme Court Even if The Judges Disagree?

Myriad Human Gene Patent Case Vacated and Remanded by U.S. Supreme Court in Light of Prometheus

Split Federal Circuit in Myriad Case Partially Reverses District Court and Finds Isolated Human Genes to be Patentable: Subsequent Supreme Court Review of this Case is Surely Essential

How SWEET It Is! Gene Patents Ruled Invalid as Genes are Found to be Non-patentable Subject Matter

Stephen Colbert on Gene Patents and the Myriad Case : Humor

The Body Snatchers are Alive and Well : In ACLU v. Myriad, the Battle over DNA Patents Rages

Networking Successfully: Spreading Awareness and Increasing Followers in Social Media

2013-04-11T15:21:00.001+02:00

Jeff Hamada has picked up a following that accounts for 3 million page views per month -- in the arts!

Sam Milbrath has the story in #MyDash with Booooooom ~ Spreading Brand Awareness in Social Media - HootSuite Social Media Management.

So what is his secret?

Hamada's basic social media networking principles in the arts are surely applicable to many other fields and to many other ventures, also to the broad European Union spectrum of online activities. Take a look.

Do You Punch a Time Clock? Timekeeping and the World of Watches (or) What's in a Chronometer?

2013-04-04T18:14:00.000+02:00

Do you punch a time clock in your work?

Time is omnipresent in the modern world.

Day-to-day time and longer term dates, dating and chronology are the clocks for all that we humans do, and time represents the monetary basis for billing in most areas of work.

We at LawPundit are always amazed that more people in all professions do not share our interest in prehistoric stargazing, ancient astronomy and megalithic cultures, all of which involved man's time-keeping long ago -- and all of which serve as timekeepers' precedents for what we call "time" now.

In this vein, the new Jaquet Droz Bird Repeater is featured at the Robb Report at FrontRunners: Jaquet Droz.

For a description of the mechanical complications of this watch, which costs about a half a million dollars and includes movable birds, see the Robb Report.

Please keep in mind that our interest in these watches is not so much how much they cost, but rather the human ingenuity and creativity that they represent.

This is just a beautiful watch, whose complex machinery is a joy to behold.

I have a special personal reason for featuring this "bird watch".

See the next posting about a more ancient time-keeping bird.

Weak Patents, the USPTO, European Patent Office, Japanese Patent Office and the Actavis Case at the U.S. Supreme Court

2013-04-02T15:41:00.001+02:00

Make sure you read the posting Actavis Case Shows Weak Patents Are System-Wide at Patent Progress, which writes inter alia as follows:

"The US Patent and Trademark Office (PTO) grants 78% of all original patent applications as opposed to 61% granted by Japan and 55% granted by the European Union.... [O]nly 72.5% of the patents issued in the US were issued by the European Patent Office and only 44.5% were issued by the Japanese Patent Office.... The PTO receives roughly ten times as much money from issuing a patent than it does from denying it....

[S]tatistics cited by the PPF show that 30% of all issued patents reviewed by courts lacked novelty, and 40% of the remaining patents were found invalid for being obvious...."

Read the whole thing here.

EU History & Ancient Britain: Creswell Crags Ochre Horse Rib Bone Carving Decipherment Update 2.0

2013-04-02T00:33:00.002+02:00

This posting is Update 2.0 to my previously posted original decipherment on this topic as also to Update 1 of the Creswell Crags "Ochre Horse" rib bone carving decipherment.

This update provides an image of the details of the rib bone, all except for the Winter stars on the top left of the rib bone, which are already included in the previous posting, and shows that large darkened spots on the rib bone are to some degree intentional carved "placements" marking stars of the heavens, e.g. stars of Ursa Major, but also other stars, some prominent, some not so prominent, and also some that are uncertain, but in general they can be said to confirm that the decipherment is correct.

Update 3.0 will follow at some time in the future with a text explanation of various matters in detail.

The engraved bone, now popularly called the "Robin Hood Cave Horse" after the cave in which it was discovered in 1876, is dated by the archaeologists to the Ice Age ca. 12500 years ago. It is the oldest artifact (British artefact) of this kind ever found in northern Europe and, as a stroke of luck for those interested, is currently on display at the British Museum until May 26, 2013 in the British Museum exhibition: Ice Age Art: Arrival of the Modern Mind.
See the reviews at:

“Not even Leonardo surpassed this” -- The Guardian
“I can’t remember the last time I saw a show with so many rare and beautiful objects” -- The Telegraph
“The exhibition everyone should see” -- The Times
“Astonishing” -- Metro

For today, only this updated decipherment, no text.
In the course of time I will reveal how I arrived at this solution. Enjoy.

Attribution of the source of the photograph above, from which I have removed the black background, is as follows from the Wikipedia:

"Creswell Crags. The Ochre Horse. This original fragment of a rib bone contains the oldest known carving of its type in Britain. The horse was carved approximately 12,500 years ago and was on temporary display at the small museum at Creswell Crags to November 2009 (although a replica of the ochre horse is always on display). It was found on the 29th June in 1876 at the back of the western chamber in the 'Robin Hood Cave' in Creswell Crags. Sieveking 855, British Museum. More information can be found at the original website: www.creswell-crags.org.uk/Home.aspx
Date     23 October 2009, 15:58
Source     The Ochre Horse - 12500 Years Old!
Author     Dave from Nottingham, England
Camera location 53° 15′ 48.48″ N, 1° 11′ 54.74″ W

The image was originally posted to Flickr by DaveKav at http://flickr.com/photos/8089996@N06/4038464041. It was reviewed on 18 December 2010 by the FlickreviewR robot and was confirmed to be licensed under the terms of the cc-by-2.0. http://en.wikipedia.org/wiki/File:Ochre_Horse.jpg"

The astronomical interpretations that surround the photograph are by Andis Kaulins, April 2, 2013, and are not part of the original photograph of the Ochre Horse rib bone. The forms of stellar constellations are taken from Starry Night Pro.

Creswell Crags Robin Hood Cave Ochre Horse Rib Bone Carving Decipherment Update 1.0

2013-04-02T00:01:00.000+02:00

This posting is Update 1.0 to my previously posted decipherment of the Creswell Crags "Ochre Horse" rib bone carving, showing that the calendric astronomy of stars is continued on the rib bone if it is turned 180 degrees, thus covering all the heavens and all the seasons and marking divisions of the heavens that would suggest a lunar and solar mesh. This update also puts the date closer to 10500 B.C. and shows that the deeply incised lines on the rib bone were added to separate the stars noted on one half of the rib bone.

A more detailed posting will follow as Update 2.0.

That engraved bone, now popularly called the "Robin Hood Cave Horse" after the cave in which it was discovered in 1876, is dated by the archaeologists to the Ice Age ca. 12500 years ago. It is the oldest artifact (British artefact) of this kind ever found in northern Europe and, as a stroke of luck for those interested, is currently on display at the British Museum until May 26, 2013 in the British Museum exhibition: Ice Age Art: Arrival of the Modern Mind.
See the reviews at:

“Not even Leonardo surpassed this” -- The Guardian
“I can’t remember the last time I saw a show with so many rare and beautiful objects” -- The Telegraph
“The exhibition everyone should see” -- The Times
“Astonishing” -- Metro

"Creswell Crags. The Ochre Horse. This original fragment of a rib bone contains the oldest known carving of its type in Britain. The horse was carved approximately 12,500 years ago and was on temporary display at the small museum at Creswell Crags to November 2009 (although a replica of the ochre horse is always on display). It was found on the 29th June in 1876 at the back of the western chamber in the 'Robin Hood Cave' in Creswell Crags. Sieveking 855, British Museum. More information can be found at the original website: www.creswell-crags.org.uk/Home.aspx
Date     23 October 2009, 15:58
Source     The Ochre Horse - 12500 Years Old!
Author     Dave from Nottingham, England
Camera location 53° 15′ 48.48″ N, 1° 11′ 54.74″ W

The image was originally posted to Flickr by DaveKav at http://flickr.com/photos/8089996@N06/4038464041. It was reviewed on 18 December 2010 by the FlickreviewR robot and was confirmed to be licensed under the terms of the cc-by-2.0. http://en.wikipedia.org/wiki/File:Ochre_Horse.jpg"

The astronomical interpretations that surround the photograph are by Andis Kaulins, April 2, 2013, and are not part of the original photograph of the Ochre Horse. The forms of stellar constellations are taken from Starry Night Pro as is also the sky map of the stars turned 180 degrees to emphasize the stars that the ochre horse rib bone portrays when it is turned, i.e. those stars on or between the Winter Solstice and Spring Equinox in ca. 10500 B.C.

Creswell Crags Robin Hood Cave Ochre Rib Bone Carving Currently on Display at the British Museum Ice Age Exhibition Deciphered as Calendric Astronomy

2013-03-31T20:04:00.001+02:00

Happy Easter!

In honor of the day of resurrection celebrated today by the Christian faith, a general theme of hope and renewal that is the backbone of religious life for many religions and denominations, I would like to share with you my recent research success in bringing back to life (via decipherment) the ancient message found on the Creswell Crags "Ochre Horse" rib bone carving.

That engraved bone, now popularly called the "Robin Hood Cave Horse" after the cave in which it was discovered in 1876, is dated by the archaeologists to the Ice Age ca. 12500 years ago. It is the oldest artifact (British artefact) of this kind ever found in northern Europe and, as a stroke of luck for those interested, is currently on display at the British Museum until May 26, 2013 in the British Museum exhibition: Ice Age Art: Arrival of the Modern Mind.
See the reviews at:

“Not even Leonardo surpassed this” -- The Guardian
“I can’t remember the last time I saw a show with so many rare and beautiful objects” -- The Telegraph
“The exhibition everyone should see” -- The Times
“Astonishing” -- Metro

For today, only the decipherment, no text.
In the course of time I will reveal how I arrived at this solution. Enjoy.

Once again, Happy Easter!

Attribution of the source of the photograph above, from which I have removed the black background, is as follows from the Wikipedia:

"Creswell Crags. The Ochre Horse. This original fragment of a rib bone contains the oldest known carving of its type in Britain. The horse was carved approximately 12,500 years ago and was on temporary display at the small museum at Creswell Crags to November 2009 (although a replica of the ochre horse is always on display). It was found on the 29th June in 1876 at the back of the western chamber in the 'Robin Hood Cave' in Creswell Crags. Sieveking 855, British Museum. More information can be found at the original website: www.creswell-crags.org.uk/Home.aspx
Date     23 October 2009, 15:58
Source     The Ochre Horse - 12500 Years Old!
Author     Dave from Nottingham, England
Camera location 53° 15′ 48.48″ N, 1° 11′ 54.74″ W

The image was originally posted to Flickr by DaveKav at http://flickr.com/photos/8089996@N06/4038464041. It was reviewed on 18 December 2010 by the FlickreviewR robot and was confirmed to be licensed under the terms of the cc-by-2.0. http://en.wikipedia.org/wiki/File:Ochre_Horse.jpg"

The astronomical interpretation below the photograph is by Andis Kaulins, March 31, 2013, and is not part of the original photograph of the Ochre Horse.

Copyrighted Works Lawfully Made Abroad and Imported to the USA Found Subject to the First Sale Doctrine by the U.S. Supreme Court in Kirtsaeng v. John Wiley & Sons, Inc.

2013-03-20T00:52:00.001+01:00

Kirtsaeng v. John Wiley & Sons, Inc. , 568 U.S. ____ (2013), a U.S. Supreme Court case decided March 19, 2013, involves a fundamental international copyright law issue holding that in the United States, the "first sale" doctrine applies to copies of a copyrighted work lawfully made abroad [marketing-oriented differential pricing notwithstanding], a court decision which means that such works can be imported into the United States without violating American copyright laws.

Justice Breyer, regarded by many to be the most intellectual of the U.S. Supreme Court Justices, wrote the majority opinion, and that opinion is a pleasure to read in substantiating the innate conservatism, tradition and history that inheres in "the law" and gives it substance and duration, as opposed to politics and current events, whose impact is more day-to-day.

Breyer wrote inter alia as follows on centuries-old common law, a common law that builds the foundation for the "first sale" doctrine, a specific limitation to copyrights, which is everywhere essential to commerce, not just in the USA but throughout the commercial, business world on our planet:

"A relevant canon of statutory interpretation favors a nongeographical reading. “[W]hen a statute covers an issue previously governed by the common law,” we must presume that “Congress intended to retain the substance of the common law.” Samantar v. Yousuf, 560 U. S. ___, ___, n. 13 (2010) (slip op., at 14, n. 13). See also Isbrandtsen Co. v. Johnson, 343 U. S. 779, 783 (1952) (“Statutes which invade the common law . . . are to be read with a presumption favoring the retention of long established and familiar principles, except when a statutory purpose to the contrary is evident”).

The “first sale” doctrine is a common-law doctrine with an impeccable historic pedigree. In the early 17th century Lord Coke explained the common law’s refusal to permit restraints on the alienation of chattels. Referring to Littleton, who wrote in the 15th century, Gray, Two Contributions to Coke Studies, 72 U. Chi. L. Rev. 1127, 1135 (2005), Lord Coke wrote:

“[If] a man be possessed of . . . a horse, or of any other chattell . . . and give or sell his whole interest . . . therein upon condition that the Donee or Vendee shall not alien[ate] the same, the [condition] is voi[d], because his whole interest . . . is out of him, so as he hath no possibilit[y] of a Reverter, and it is against Trade and Traffi[c], and bargaining and contracting betwee[n] man and man: and it is within the reason of our Author that it should ouster him of all power given to him.” 1 E. Coke, Institutes of the Laws of England §360, p. 223 (1628).
A law that permits a copyright holder to control the resale or other disposition of a chattel once sold is similarly “against Trade and Traffi[c], and bargaining and contracting.” Ibid.

With these last few words, Coke emphasizes the importance of leaving buyers of goods free to compete with each other when reselling or otherwise disposing of those goods. American law too has generally thought that competition, including freedom to resell, can work to the advantage of the consumer. See, e.g. Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U. S. 877, 886 (2007) (restraints with “manifestly anticompetitive effects” are per se illegal; others are subject to the rule of reason (internal quotation marks omitted)); 1 P. Areeda & H. Hovenkamp, Antitrust Law ¶100, p. 4 (3d ed. 2006) (“[T]he principal objective of antitrust policy is to maximize consumer welfare by encouraging firms to behave competitively”).

The “first sale” doctrine also frees courts from the administrative burden of trying to enforce restrictions upon difficult-to-trace, readily movable goods. And it avoids the selective enforcement inherent in any such effort. Thus, it is not surprising that for at least a century the “first sale” doctrine has played an important role in American copyright law. See Bobbs-Merrill Co. v. Straus, 210 U. S. 339 (1908); Copyright Act of 1909, §41, 35 Stat. 1084. See also Copyright Law Revision, Further Discussions and Comments on Preliminary Draft for Revised U. S. Copyright Law, 88th Cong., 2d Sess., pt. 4, p. 212 (Comm. Print 1964) (Irwin Karp of Authors’ League of America expressing concern for “the very basic concept of copyright law that, once you’ve sold a copy legally, you can’t restrict its resale”).

The common-law doctrine makes no geographical distinctions; nor can we find any in Bobbs-Merrill (where this Court first applied the “first sale” doctrine) or in §109(a)’s predecessor provision, which Congress enacted a year later. See supra, at 12. Rather, as the Solicitor General acknowledges, “a straightforward application of Bobbs-Merrill” would not preclude the “first sale” defense from applying to authorized copies made overseas. Brief for United States 27. And we can find no language, context, purpose, or history that would rebut a “straightforward application” of that doctrine here.

The dissent argues that another principle of statutory interpretation works against our reading, and points out that elsewhere in the statute Congress used different words to express something like the non-geographical reading we adopt. Post, at 8–9 (quoting §602(a)(2) (prohibiting the importation of copies “the making of which either constituted an infringement of copyright, or which would have constituted an infringement of copyright if this title had been applicable” (emphasis deleted))). Hence, Congress, the dissent believes, must have meant §109(a)’s different language to mean something different (such as the dissent’s own geographical interpretation of §109(a)). We are not aware, however, of any canon of interpretation that forbids interpreting different words used in different parts of the same statute to mean roughly the same thing. Regardless, were there such a canon, the dissent’s interpretation of §109(a) would also violate it. That is because Congress elsewhere in the 1976 Act included the words “manufactured in the United States or Canada,” 90 Stat. 2588, which express just about the same geographical thought that the dissent reads into §109(a)’s very different language. "

The majority -- Chief Justice Roberts and Justices Kagan, Sotomayor, Breyer, Thomas and Alito -- were thus right on the law, so, our opinion.

"Justice Ginsburg filed a dissenting opinion in which Justice Kennedy joined, and in which Justice Scalia joined except as to Parts III and V–B–1." SCOTUSblog at Kirtsaeng v. John Wiley & Sons, Inc.

Justice Ginsburg, who wrote the dissent here, seems to have gotten wrapped up in the convoluted ripples of her own previous dicta, citing to herself in the Quality King case ( Quality King Distributors Inc., v. L'anza Research International Inc., 523 U.S. 135 (1998), as "GINSBURG, J., concurring"), a case summarized at the Wikipedia as follows:

"In 1998 the U.S. Supreme Court in Quality King v. L'Anza found that first-sale doctrine applied to imported goods at least where the imported goods are first lawfully made in the United States, shipped abroad for resale, and later reenter the United States. That case involved importation of hair care products bearing copyrighted labels. A unanimous Supreme Court found that the first-sale doctrine does apply to importation into the US of copyrighted works (the labels), which were made in the US and then exported."

To that unanimous decision in Quality King Distributors Inc., v. L'anza Research International Inc., 523 U.S. 135 (1998), Ginsburg wrote the sole concurring opinion representing her view (as dicta) in short as follows:

"This case involves a “round trip” journey, travel of the copies in question from the United States to places abroad, then back again. I join the Court’s opinion recognizing that we do not today resolve cases in which the allegedly infringing imports were manufactured abroad. See W. Patry, Copyright Law and Practice 166—170 (1997 Supp.) (commenting that provisions of Title 17 do not apply extraterritorially unless expressly so stated, hence the words “lawfully made under this title” in the “first sale” provision, 17 U.S.C. § 109(a), must mean “lawfully made in the United States”); see generally P. Goldstein, Copyright §16.0, pp. 16:1—16:2 (2d ed. 1998) (“Copyright protection is territorial. The rights granted by the United States Copyright Act extend no farther than the nation’s borders.”)."

It was thus her "personal opinion" and not precedential law that the phrase "lawfully made under this title" as found in the "first sale" provision "must mean" "lawfully made in the United States".

The title does not say that, and so the majority in Kirtsaeng found.

Accordingly, Justice Ginsburg's dissent in Kirtsaeng v. John Wiley & Sons, Inc., 568 U.S. ____ (2013) is best viewed as a "personal" justification for her concurring opinion of 14 years ago.

One could even agree with her that copyright law may be largely "territorial", as she claims, but that was not really the precise legal issue in Kirtsaeng, since the competing first sale doctrine is not territorial, but is rather an essential element of daily commerce around the world and an essential limitation on copyrights.

As for the other dissenters....let us recapitulate....

"Justice Ginsburg filed a dissenting opinion in which Justice Kennedy joined, and in which Justice Scalia joined except as to Parts III and V–B–1." SCOTUSblog at Kirtsaeng v. John Wiley & Sons, Inc. [emphasis added]

Justice Scalia seems to place less importance on following the common law or general precedents of law, so his concurrence here is perhaps no surprise, although we thought him to be more practical than writing concurrences "in part". How on EARTH, Justice Scalia, are lower courts or anyone else to "follow" that kind of legal "fracking"? Law should not be "hair-splitting" at the ultimate decision-making level. Courts must be clear in their opinions and views, so that citizens can follow judicial dictates. A judge who writes that he agrees with points a, c, d, f, g, m, and q but disagrees with b, e, h, i, j, k, l, n, o, and p, really helps no one, so what is the point of doing that?

Justice Kennedy in the past year or so since his losing stance on Obamacare remains an enigma. We have no idea what led him in Kirtsaeng to take a position so distant from "centrist pragmatics". Had the dissent prevailed in this case, it would have led to a nullification of the first sale rule for any imports having any relation to copyrights and would have led to an unimaginable chaos in the commercial world -- as many copyrighted products, also in the tech sector, would have found themselves "banned" from import pending judicial decisions. Such a legal state of affairs can not be permitted.

As for the concurrences:

"Justice Kagan filed a concurring opinion in which Justice Alito joined." SCOTUSblog at Kirtsaeng v. John Wiley & Sons, Inc.

Justice Kagan's concurrence can be summarized in her concluding statement -- surely correct -- that:

"If Congress thinks copyright owners need greater power to restrict importation and thus divide markets, a ready solution is at hand--not the one John Wiley offers in this case, but the one the Court rejected in Quality King."

For the first time in our pages, we loudly applaud
Justice Thomas and Justice Alito.
Thank you for this decision.

Gentlemen, hope springs eternal, also in law. It gives us a reason to look forward to coming decisions of the U.S. Supreme Court in anticipation that LAW will prevail over politics and overcome personal preferences, opinions, and/or doctrines. "There oughta be a law", and there is.

For a background on this case, see our previous postings at
A Landmark Case in Intellectual Property Law Coming Up at the U.S. Supreme Court: Copyrights, Property Ownership, Differential Pricing and the First Sale Doctrine in Law and Capitalism
and
New York Times Editorial on Imported Works and Special Copyrights Raises Issues: We Ask Whether Protective Tariffs are Gone, But Long Live Import Bans Based on Alleged Intellectual Property Rights?

EU Plan to Limit Bankers’ Bonuses Agreed Upon by Negotiators for the European Parliament and Council: British Adopt Inconsistent Position

2013-03-03T18:03:00.001+01:00

As reported at the New York Times by James Kanter and David Jolly, European Union negotiators for the European Parliament and Council have agreed on a plan to Limit Bankers’ Bonuses.

The strict limits will be part of a banking regulation package known as Basel III, which is designed to reduce banking dangers and excesses that helped to contribute to the financial crisis in Europe.

The British government opposes the plan, while at the same time waving the red banner of a future British referendum on European Union membership, which appears to this observer to be inconsistent, as Britain is thus trying to block correction of financial problems in the EU that in part have led to British dissatisfaction with the EU in the first place. You can't have it both ways.

Patent Law and Genetically Modified Seeds and Plants: Oral Argument in Bowman v. Monsanto in the U.S. Supreme Court Suggests Reliance on a Legal Patent Doctrine of Unauthorized "Copying" as the Ratio Decidendi

2013-02-26T17:20:00.000+01:00

Last week, the U.S. Supreme Court held oral argument on
Bowman v. Monsanto Co.

Adam Liptak reported at the NYTimes.com in Supreme Court Hears Arguments in Bowman v. Monsanto.

It is clear from the questioning during oral argument that Monsanto will prevail on the merits, although it appears to this observer that many commentators underestimate the judicial and legal difficulty of this case, which the Supreme Court took on because it is the first time that the patent rights to progeny of a "self-replicated" product are being decided, i.e. whether successive generations of self-replicating seeds are subject to Monsanto patents on the "original" humanly and genetically-modified non-replicated seed.

Oral argument suggests quite convincingly that the Supreme Court will not rely on some kind of conditional sales doctrine as representing some form of restrictive "license" as a limitation on the first sale doctrine. As Justice Breyer said in this regard:

"Now, they -- they thought, the [Federal C]ircuit, that there's some restriction in a license and they have a doctrine that seems to say that you can restrict licenses -- through licenses the use of a product after it's been sold. And that would seem contrary to the first sale doctrine""

Obviously, the Supreme Court will be sure to set the Federal Circuit straight on its "lingering confusion" (quoting Justice Sotomayor) with respect to conditional sales. "Sales" have nothing to do with the coming decision per se.

Furthermore, the Court will also not rely on contractual limitations as the means by which patent holders must protect their rights. Patent rights as such are rights granted by the patents themselves, and not by contracts.

Rather, it is quite clear that the Supreme Court will hold that successive generations of self-replicating genetically modified and thus rightfully "patented" seeds are "copies" of the original patented seed, the "making" of which via unauthorized copies is prohibited.

Such a resolution as above of the legal problem presented by the case may appear by hindsight to be "apparent", but by no means necessarily obvious as a matter of law. Indeed, a strict view of the facts would hold that "God" makes the copies in the case of seed replication, regardless of genetic modification, even if human intervention (planting, fertilizing, watering, etc.) may also be required. In any case, the definition of "copying" here will be extended by the Court to its furthest possible limit for purposes of patent law.

It must be emphasized here in closing that the patents to the Monsanto soybeans involve the insertion of a genetic sequence into the germplasm of seeds that makes the resulting plants resistant to glyphosate, a herbicide manufactured by Monsanto, that otherwise kills other plants and weeds by inhibiting an enzyme necessary for growth.

When glyphosate is applied from the air, other plants and weeds in the field are killed while the resistant genetically modified plants survive and grow.

In other words, contrary to the situation in the upcoming Myriad case decision at the Supreme Court involving human genes, the "seed" here "created" by Monsanto has been truly "humanly" altered, even if the patent incorporates the original soybean seed or other plant seed as the object of the genetic modification. In Myriad, by contrast, there is the attempt to patent "cleaved snips" of actually existing human genes, and that of course will be denied by the Supreme Court, since the genetic code remains as is for its operative part, and is used principally as such, even if in abbreviated form.

In Monsanto there is a completely new addition to the genetics of the seed. In Myriad, one is merely using a genetics that is already there.

See the briefs to the Monsanto case at americanbar.org.

New German President Speaks: The European Union Needs the United Kingdom: "In Germany, more Europe doesn't mean a German Europe." English Has Become the Lingua Franca of the EU's Young People

2013-02-24T23:16:00.002+01:00

New German President Joachim Gauck in his first speech on the European Union addressed the other countries of Europe (and the world) in a positive, upbeat tone.

Valentina Pop has the story for EUobserver.com at

Germany does not want 'diktat' on Europe

Gauck assured the countries of Europe and the world that:

"In Germany, more Europe doesn't mean a German Europe....

"Dear Englishmen, Scots, Welsh, northern Irish and Brits, we want to have you here with us....

We need your experience as a country with the oldest parliamentary democracy.

We need your traditions, your sobriety, your courage. Your intervention in the Second World War helped rescue our Europe - it is also your Europe...."

The EUObserver writes further that:

"[Gauck] noted that English has become the "lingua franca" for young people in Europe.

In what would be an irony if the UK were to go, Gauck noted that it would be almost impossible for a German to understand a Portuguese or a Latvian person unless they spoke some English in common."

Where are Apple Profits Going? Into the Pockets of Corporate Executives?

2013-02-24T22:55:00.003+01:00

Where are the massive Apple profits NOW going?

To "The Four Musketeers"?

Consider that Steve Jobs passed away on October 5, 2011.

""The CD&A ... discloses that, in November 2011, four Apple executives were granted 150,000 RSUs each, totaling approximately $60 million per executive on the date of the grant."[emphasis added by LawPundit]"

That sentence comes out of a U.S. District Court opinion by Richard J. Sullivan, an opinion which we reproduce fully in text form below. It is an interesting question as to why such outrageous benefits were doled out to corporate executives at Apple at that time, especially given the general public opinion that the immediately preceding deceased coprorate executive had "made" Apple, and not the people who followed him, followers who now are arguably raking in massive amounts of money from the remaining company corpus, thus plundering the company and reducing shareholder value.

We find Sullivan's opinion to be excellent on "unbundling" but woefully, desperately, weak on the question of what constitutes "ample disclosure of corporate executive compensation", as if catchwords such as "experiences", "peer groups" and "consultants" could amply disclose to shareholders why a quarter of a billion dollars allegedly had to be paid to keep four arguably fungible and to us nameless corporate executives on the company rolls (as if anyone else was offering that kind of money to them "to abandon ship").

The above-cited sentence is not directly relevant to that court's granting of a preliminary injunction against Apple for violating the unbundling rules of the 1934 Securities Exchange Act, but it is one crass example of the kind of massive plundering of companies taking place for the benefit of a few corporate executives, leading to the vast inequality of income rampant in America -- a plundering aided by weak judicial decisions such as this one.

We posted previously at Law Pundit about suits by investors against Apple at Greenlight Capital Gives Apple the Red Light as David Einhorn Charges Apple With Illegal Bundling under Section 14 of the Securities Exchange Act of 1934.

John Boudreau at MercuryNews.com now reports in an excellent summary of the case that Activist investor David Einhorn wins a round in effort to block Apple vote, writing inter alia that:

"A federal judge in Manhattan ruled Friday in favor of activist hedge fund investor David Einhorn's effort to stop an upcoming Apple-sponsored proxy proposal that would require shareholder approval to create a special class of stock ... the ruling focused on the company's decision to bundle that measure with a number of other issues in one proposal."

In our view, the decision here on unbundling is legally inevitable, given the SEC laws and rules. The decision on executive compensation, on the other hand, is judicially gullible and far from the reality of what corporate executives are worth.

The case in question is Greenlight Capital LP, et al., v. Apple Inc., U.S. District Court, Southern District of New York, 13-900. That District Court link to the .pdf of the downloadable decision currently [February 24, 2013] lacks the .pdf extension, so that after we downloaded the case, we had to change the name from Greenlight to Greenlight.pdf and then open it in our pdf viewer. We have converted the decision from .pdf to text form and include that below for those who have trouble accessing the .pdf. Please note that this text version is NOT official and we make no guarantees of accuracy, so get the .pdf at the court website if you plan to use the material of this case further.

[LawPundit Note on the case in text form below: This text version is NOT an official or officially sanctioned copy of the court decision and thus it is offered here solely for purposes of general information with no guarantees or warranties of any kind.]

"UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF NEW YORK

No. 13 Civ. 900 (RJS)

GREENLIGHT CAPITAL, L.P., et al., Plaintiffs,

VERSUS

APPLE, INC., Defendant.

No. 13 Civ. 976 (RJS)

BRIAN GRALNICK, Plaintiff,

VERSUS

APPLE, INC., Defendant.

MEMORANDUM AND ORDER, February 22, 2013

RICHARD J. SULLIVAN, District Judge:

In preparation for its annual shareholder meeting, Defendant Apple, Inc. (“Apple”) issued a definitive proxy statement (the “Proxy Statement”) and proxy card (the “Proxy Card”) soliciting shareholder votes on a range of proposals. Plaintiffs Greenlight Capital, L.P.; Greenlight Capital Qualified, L.P.; Greenlight Capital Gold, L.P.; Greenlight Capital Offshore Partners; and Greenlight Capital Offshore Master Gold, Ltd. (collectively, “Greenlight”) assert that Proposal Number 2 of the Proxy Statement and Proxy Card violates the “unbundling” rules promulgated by the Securities and Exchange Commission (“SEC”), which require that a proxy permit shareholders to vote separately on each matter presented for consideration. Plaintiff Brian Gralnick (“Gralnick”), in addition to bringing his own bundling claim with respect to Proposal Number 2, asserts that Proposal Number 4 of the Proxy Statement and Proxy Card violates the “say-on-pay” rules promulgated by the SEC, which require disclosure of factors affecting executive compensation. Before the Court are Greenlight’s and Gralnick’s motions seeking to preliminarily enjoin Apple from giving effect to the challenged votes. For the reasons that follow, the Court grants Greenlight’s and Gralnick’s motions regarding Proposal Number 2, but denies Gralnick’s motion regarding Proposal Number 4.

I. FACTS¹

^{[NOTE BY LAWPUNDIT: Plese note that LawPundit has inserted the text of footnotes as directly under the footnotes as possible, whereas the original court decision has these at the bottom of the respective column of the respective .pdf page in which the respective footnote appears.]}

¹The facts are taken from Greenlight’s Complaint (“Green. Compl.”) and Gralnick’s Complaint (“Gral. Compl.”). In ruling on Plaintiffs’ motions, the Court considered Greenlight’s memorandum of law (“Green. Mem.”); Apple’s opposition brief (“Opp’n to Green.”); and Greenlight’s reply brief (“Green. Reply”); as well as Gralnick’s memorandum (“Gral. Mem.”); Apple’s opposition (“Opp’n to Gral.”); and Gralnick’s reply (“Gral. Reply”); along with the declarations and exhibits attached thereto.

A. Background

Apple, the technology giant, is a California corporation with its principal place of business in California and a permanent office in New York. (Green. Compl. ¶¶ 8, 11; Gral. Compl. ¶ 10.) Its stock is traded on the NASDAQ under the symbol AAPL. (Green. Mem. 3.) The Greenlight entities are three limited partnerships, a partnership, and a limited liability company, all with their principal places of business in New York. (Green. Compl. ¶¶ 2-6.) Greenlight owned 1.3 million Apple shares as of January 2, 2013, the record date for Apple’s shareholder meeting. (Id. ¶ 7.) Gralnick, an individual, has been an Apple shareholder since 2007. (Gral. Compl. ¶ 9.)

In preparation for its annual shareholder meeting, scheduled for February 27, 2013, Apple filed a preliminary proxy statement with the SEC on December 27, 2012, and issued the Proxy Statement and Proxy Card to shareholders on January 7, 2013. (Green. Compl. ¶ 12, Ex. A; Gral. Compl. ¶ 11; Tr. Of Oral Arg., dated Feb. 19, 2013 (“Tr.”), 35:23.) The proxy materials included six proposals for shareholder consideration, two of which are at issue in this action.

1. Proposal Number 2

Proposal Number 2 in the Proxy Statement (“Proposal No. 2”) seeks to amend Apple’s Restated Articles of Incorporation (the “Articles”). (Green. Compl. ¶ 13, Ex. A 1, 44-46, 54-61; Gral. Compl. ¶ 14.) Specifically, Proposal No. 2 seeks proxies to:

[(1)] eliminate certain language relating to the term of office of directors in order to facilitate the adoption of majority voting for the election of directors; [(2)] eliminate “blank check” preferred stock; [(3)] establish a par value for [Apple’s] common stock of $0.00001 per share; and [(4)] make other conforming changes . . . , including eliminating provisions in the Articles relating to preferred stock of [Apple].

(Green. Compl. Ex. A 44.) The first item in Proposal No. 2 would facilitate majority voting for incumbent members of Apple’s Board of Directors (the “Board”) under California law. (Id. at 45.) Though Apple shareholders endorsed majority voting in 2011, and the Board acceded in 2012, the amendment is necessary to conform the Articles to state law. (Opp’n to Green. 16.) The second item would revoke the Board’s power to unilaterally issue preferred stock – that is, stock providing greater rights and privileges than Apple common stock –thereby requiring shareholder approval of any future issuance. (Green. Compl. Ex. A 45.) The third item would establish a nominal par value for Apple’s common stock in an attempt to avoid state fees stemming from Apple’s no-par shares. (Id. at 45-46.) The final item would eliminate certain obsolete provisions in the Articles. (Id. at 46.)

The history of Proposal No. 2 is a contentious one. Presently, Apple’s Board has the authority to unilaterally issue preferred stock. (See Opp’n to Green. 5-6.) This power – commonly referred to as “blank check” authority – has been derided by shareholder rights advocates given its potential use as an anti-takeover tactic, and a number of companies have removed such provisions from their charters. (Id.) In May 2012, Apple began the process of eliminating the provision from its Articles. (Id. at 7.) However, that same month, Greenlight principal David Einhorn (“Einhorn”) approached Apple with a proposal to utilize its “blank check” power. (Decl. of David Einhorn, dated Feb. 6, 2013, Green. Doc. No. 6 (“Einhorn Decl. Feb. 6”), ¶ 3.) In a conference call, Einhorn encouraged Apple to issue perpetual preferred shares to its existing shareholders in a bid to return value to Apple investors. (Id.) Nevertheless, in September 2012, Apple rejected Einhorn’s proposal and instead moved forward with the planned elimination. (Id.; Opp’n to Green. 9.)

On February 1, 2013, Greenlight urged Apple to withdraw the “blank check” amendment. (Green. Compl. ¶ 18.) On February 5, 2013, Greenlight reiterated its request and, in the alternative, pressed Apple to break up Proposal No. 2 into separate voting items given Greenlight’s support for at least two of the four amendments. (Id.; Einhorn Decl. Feb. 6 ¶¶ 10-11.) Apple declined. (Einhorn Decl. Feb. 6 ¶ 12.) Accordingly, Greenlight filed suit on February 7, 2013, alleging that the up-or-down vote on Proposal No. 2 violated SEC Rules 14a-4(a)(3) and (b)(1). (Green. Compl. ¶ 15); see 17 C.F.R. § 240.14a-4(a)(3), (b)(1). Gralnick followed suit on February 12, 2013, advancing similar claims. (Gral. Compl. ¶ 15; Decl. of Brian Gralnick, dated Feb. 12, 2013, Gral. Doc. No. 15 (“Gralnick Decl.”), ¶ 4.)

2. Proposal Number 4

Proposal Number 4 in the Proxy Statement (“Proposal No. 4”), or the “say-on-pay proposal,” seeks “advisory vote[s] to approve the compensation of [Apple’s] named executive officers.” (Green. Compl. Ex. A 47.) Though Apple’s 2012 executive compensation has already been paid, the “say-on-pay” vote permits shareholders an opportunity to express their opinion on Apple’s compensation program. (Id. at 49.) The outcome of the vote may also inform Apple’s “future compensation decisions.” (Id.) To provide a basis for the vote, and pursuant to SEC disclosure rules, the Proxy Statement details Apple’s executive compensation in a sixteen-page report called the Compensation Discussion and Analysis (“CD&A”). (See id. at 25-42.) The CD&A, inter alia, lists the elements of Apple’s compensation for named executives; discusses the purpose of each element and the method of award; describes Apple’s philosophy for awarding compensation, with a focus on “exceptional personal performance” and “internal equity”; provides an assessment of the company’s performance; lists the members of the Compensation Committee as well as their backgrounds and qualifications; emphasizes the weight given to the input of Apple CEO Tim Cook (“Cook”) concerning the performance and compensation of the named executives; and catalogs the peer firms considered in connection with Apple’s compensation decisions as well as the criteria used to select those firms. (Id.)

Among the elements of executive compensation listed in the CD&A are “[l]ong-term equity awards in the form of [restricted stock units, or] RSUs[, which] constitute the majority of each named executive officer’s total compensation opportunity.” (Id. at 48; see id. at 29.) Regarding the award of RSUs, the CD&A states that:

The Compensation Committee’s determination of the size of the RSU awards was a subjective determination. The Compensation Committee believed that the RSU awards should be meaningful in size in order to retain [Apple’s] executive team during the CEO transition.There was no formula or peer group “benchmark” used in determining these awards. Rather, the size of the awards was the result of the Compensation Committee’s business judgment, which was informed by the experiences of the members of the Committee, the Committee’s assessment of [Apple’s] performance, the input received from [Apple CEO] Cook, as well as the input and peer group data provided by [Apple’s executive compensation consultant].

(Id. at 30.) The CD&A also discloses that, in November 2011, four Apple executives were granted 150,000 RSUs each, totaling approximately $60 million per executive on the date of the grant.² (Id.; Gral. Compl. ¶ 25.)

²Though granted in 2011, the RSU awards are considered by Apple to be part of its 2012 executive compensation. (Id. at 31.)

On February 12, 2013, in addition to his bundling complaint, Gralnick filed a claim that Proposal No. 4 violates SEC disclosure requirements on the ground that Apple’s use of terms like “experiences,” “input,” and “peer group data” fails to provide an intelligible basis for shareholders to judge Apple’s executive compensation decisions, particularly the sizeable RSU awards. (Gral. Compl. ¶¶ 22-23); see 17 C.F.R. § 229.402(b)(1)(v).

B. Procedural History

Greenlight filed its Complaint on February 7, 2013, alleging violations of Section 14 of the Securities Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. § 78n, and Rules 14a-4(a)(3) and (b)(1) promulgated thereunder. (Green. Compl. ¶ 24); see 17 C.F.R. § 240.14a-4(a)(3), (b)(1). That day, Greenlight also moved by Order to Show Cause for a Preliminary Injunction to enjoin Apple from (1) certifying or accepting proxy votes cast in connection with Proposal No. 2, (2) amending its Articles based on such votes, or (3) proceeding with its shareholder meeting in violation of SEC rules. (Green. Doc. No. 1.)

On February 13, 2013, Gralnick brought a similar action pursuant to Section 14 of the Exchange Act; Rules 14a-4(a)(3) and (b)(1); and SEC Regulation S-K, Item 402(b)(1)(v). Gralnick seeks identical relief to that sought by Greenlight with respect to Proposal No. 2, and seeks to enjoin Apple from certifying or accepting proxy votes cast in connection with Proposal No. 4, or from proceeding with its shareholder meeting in violation of SEC rules regarding the “say-on-pay” vote. (Gral. Compl. ¶¶ 2-3); see 17 C.F.R. § 229.402(b)(1)(v).

Apple filed its opposition to Greenlight’s motion on February 13, 2013, and to Gralnick’s motion on February 14, 2013. (Green. Doc. No. 13; Gral. Doc. No. 7.) Greenlight and Gralnick both replied on February 15, 2013. (Green. Doc. No. 22; Gral. Doc. No. 20.) The Court heard oral argument on February 19, 2013.

II. LEGAL STANDARD

A preliminary injunction is an “extraordinary remedy.” Winter v. Natural Res. Def. Council, 555 U.S. 7, 24 (2008). “A plaintiff seeking a preliminary injunction must establish [(1)] that he is likely to succeed on the merits, [(2)] that he is likely to suffer irreparable harm in the absence of preliminary relief, [(3)] that the balance of equities tips in his favor, and [(4)] that an injunction is in the public interest.” Winter, 555 U.S. at 20. In the Second Circuit, a plaintiff may satisfy the first element of this inquiry by establishing “either (1) likelihood of success on the merits or (2) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly toward the party requesting the preliminary relief.” Salinger v. Colting, 607 F.3d 68, 79 (2d Cir. 2010). Finally, a plaintiff bears the burden of demonstrating “by a clear showing” that the necessary elements are satisfied. Mazurek v. Armstrong, 520 U.S. 968, 972 (1997). Failure to satisfy this burden for any one of the elements is fatal to a preliminary injunction claim. eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006) (“According to well-established principles of equity, a plaintiff seeking a permanent injunction must satisfy a four-factor test before a court may grant such relief.”).

III. DISCUSSION

The dimensions of this dispute extend well beyond the SEC rules invoked in the Complaints: billionaire hedge fund manager Einhorn is at odds with Apple over the future of the company’s capital allocation strategy. (See Green. Mem. 4; Opp’n to Green. 8-9.) But despite the sweep of the parties’ disagreement, the Court’s inquiry remains a narrow one: whether Apple’s proxy materials “likely” violate the SEC rules governing proxies for shareholder vote, and whether Greenlight and Gralnick will suffer irreparable harm as a result. The parties dispute each of the elements of the preliminary injunction analysis guiding that inquiry. Accordingly, the Court addresses each in turn.

A. Proposal No. 2

1. Likelihood of Success on the Merits

To establish a likelihood of success on the merits, a plaintiff “need not show that success is certain, only that the probability of prevailing is ‘better than fifty percent.’” BigStar Entm’t, Inc. v. Next Big Star, Inc., 105 F. Supp. 2d 185, 191 (S.D.N.Y. 2000) (quoting Wali v. Coughlin, 754 F.2d 1015, 1025 (2d Cir. 1985)). Accordingly, the Court need not determine that Greenlight and Gralnick have succeeded on the merits to issue an injunction. It need only decide that they likely may.

Section 14 of the Exchange Act governs shareholder proxy solicitations for publicly traded companies and was enacted in “the congressional belief that ‘fair corporate suffrage is an important right that should attach to every equity security bought on a public exchange.’” J.I. Case Co. v. Borak, 377 U.S. 426, 431 (1964) (quoting H.R. Rep. 73-1383, at 13 (1934)); see 15 U.S.C. § 78n. In an effort to achieve that purpose, the SEC adopted “unbundling” rules, which govern the substance and form of proxy solicitations. Rule 14a-4(a)(3), governing substance, requires that “[t]he form of proxy . . . [s]hall identify clearly and impartially each separate matter intended to be acted upon, whether or not related to or conditioned on the approval of other matters.” 17 C.F.R. § 240.14a-4(a)(3) (emphasis added). Rule 14a-4(b)(1), governing form, requires that shareholders be given “an opportunity to specify by boxes a choice between approval or disapproval of, or abstention with respect to each separate matter referred to therein as intended to be acted upon.” 17 C.F.R. § 240.14a-4(b)(1) (emphasis added). Thus, the “unbundling” rules, by their plain terms, “require distinct voting items on ‘each separate matter’” in a management proposal. Koppel v. 4987 Corp., 167 F.3d 125, 138 (2d Cir. 1999) (quoting 17 C.F.R. § 240.14a-4(a)(3), (b)(1)). “[W]hat constitutes a ‘separate matter’ for purposes of the two rules is ultimately a question of fact to be determined in light of the corporate documents and in consideration of the SEC’s apparent preference for more voting items rather than fewer.” Id.

Indisputably, if the items in Proposal No. 2 constitute “separate matters” for shareholder consideration, they must be unbundled into separate voting items. However, the question of what, precisely, constitutes a “separate matter” has received scant attention from the courts. Instead, the regulatory treatment of the rules provides the principal guidance. Passed in 1992 as part of a package of proxy amendments, the “unbundling” rules serve a dual purpose: “to permit shareholders to [(1)] communicate to the board of directors their views on each of the matters put to a vote, and [(2)] not be forced to approve or disapprove a package of items and thus approve matters they might not if presented independently.” Securities Exchange Act Release No. 34-30849, 1992 WL 151037, at *6 (Jun. 23, 1992). Accordingly, management may not propose several, aggregated charter amendments “by treating them . . . as [one] vote on the restatement of corporate documents,” but it may combine “ministerial or technical matters” that do not alter substantive shareholder rights. Randall S. Thomas & Catherine T. Dixon, Aranow & Einhorn on Proxy Contests for CorporateControl (“Proxy Contests”) § 9.01, at 9-23, 9-24 (3d ed. 1999 Supplement) (citing unmemorialized SEC guidance).

Given the language and purpose of the rules, it is plain to the Court that Proposal No. 2 impermissibly bundles “separate matters” for shareholder consideration. Even ignoring the mere formulation of Proposal No. 2 as four distinct changes, which “alone suggests the[ir] separability,” Koppel, 167 F.3d at 138, the present bundling of items forces shareholders, including Greenlight and Gralnick, to “approve or disapprove a package of items and thus approve [or disapprove] matters they [would] not if presented independently,” Securities Exchange Act Rel. No. 34-30849, 1992 WL 151037, at *6 (Jun. 23, 1992). Further, the bundling denies shareholders like Greenlight and Gralnick the ability to “communicate to the [Board] their views on each of the matters put to a vote.” Id.

Apple endeavors to avoid that finding by arguing that Proposal No. 2 complies with the “unbundling” rules because it (a) offers only one matter for consideration – whether to amend the Articles; (b) is in keeping with common proxy practice; (c) has not been challenged by the SEC; (d) does not group “material” matters – that is, matters affecting substantive shareholder rights; and (e) does not pair pro-shareholder amendments with provisions harming shareholder interests. (Opp’n to Green. 12-16.) Apple’s arguments are unavailing.

a. Proposal No. 2’s Purpose of Amending the Articles

Apple argues that “Proposal No. 2 does not constitute improper ‘bundling’ [because] . . . shareholders are only being asked one thing – whether to amend the Articles.” (Id. at 12.) But it is irrelevant that Proposal No. 2 is limited to amending the Articles – it presents four separate amendments for consideration that, unless ministerial or technical, require separate shareholder votes. Holding otherwise would preclude application of the “unbundling” rules to all but the most egregious proxy packaging, and would ignore the information-forcing benefit of permitting separate votes on separate amendments.

b. Common Proxy Practice

Apple also contends that “[m]any proxy statements have combined into a single proposal changes to eliminate authority to issue ‘blank check’ preferred stock together with other charter amendments.” (Id. at 13.) However, the fact that other companies have bundled similar proposals in their proxy statements is of no moment as none of the proxy statements cited by Apple have been held to comply with SEC rules. There is a vast difference between compliant proxies and non-compliant but unchallenged proxies, and the latter proxies are irrelevant to this Court. Apple cites no case law or regulatory authority endorsing such bundling proposals; consequently, Apple’s assertion regarding “other charter amendments” offers no guidance with respect to this matter.

c. SEC Inaction

Apple next presses the Court to infer compliance from the SEC’s inaction, particularly because Apple “specifically highlight[ed]” Proposal No. 2 in its December 2012 submission to the SEC. (Id. at 12); see Sherman v. Posner, 266 F.Supp. 871, 874 (S.D.N.Y.1966) (stating that “[SEC] inaction . . . is to be accorded some weight where . . . the information which forms the basis for an injunctive motion previously has been brought to the attention of the [SEC] and the [SEC] has presumably approved issuance of the material”). The Court declines to draw such an inference. First, as the SEC’s own regulations make clear, “[t]he fact that a proxy statement, form of proxy[,] or other soliciting material has been filed with or examined by the [SEC] shall not be deemed a finding by the [SEC] that such material is accurate or complete or not false or misleading, or that the [SEC] has passed upon the merits of or approved any statement contained therein or any matter to be acted upon by security holders.” 17 C.F.R. § 240.14a-9(b). Indeed, the “SEC has made clear . . . that it needs private actions as a supplement to its efforts to enforce Rule 14a-4’s separate matter requirement due to its limited staff resources.” Koppel, 167 F.3d at 136 (internal quotation marks omitted). More importantly, even assuming, like the district court in the 1966 Sherman decision, that the SEC’s silence should be accorded “some weight,” the fact remains that the Court is not “relieved of its obligation to exercise its independent judgment as to whether the [proxy materials] complied with [SEC rules].” Pabst Brewing Co. v. Jacobs, 549 F. Supp. 1068, 1076 (D. Del. 1982) (ordering relief where proxy materials likely violated SEC rules). Here, regardless of the SEC’s inaction, the Court believes that the proxy materials are plainly noncompliant with the clear requirements of Rule 14a-4.

d. “Material” Matters

Apple’s next argument, that the amendments are “technical” or “ministerial” and thus not subject to the bundling requirement, is equally unavailing given the amendments at issue in Proposal No. 2. (Opp’n to Green. 14-16.) As an initial matter, Apple’s argument that the “blank check” amendment is not material strains reason. (Id. at 16.) Apple asserts that the amendment is not material because the Board would not issue preferred stock without shareholder approval, regardless of its “blank check” authority. That is, “the Board has effectively said – by unanimously voting to present the [‘blank check’] proposal to shareholders – that it would seek shareholder approval before issuing preferred stock.” (Id.) Of course, the Board has said no such thing. It is true that Apple’s Board has demonstrated restraint in using its “blank check” authority, but declining to use power does not amount to elimination of that power. There is no reason to believe that a future Board, or even this Board, could not be persuaded to use its “blank check” authority to free capital. Further, the very existence of this action and the merits debate over the amendment suggests that elimination of the “blank check” provision is indeed material. (See Green. Reply at 3.)

Apple’s next assertion – that the remaining items are not material and thus Proposal No. 2 is in compliance – presents a closer question, but is also unpersuasive. First, it is far from obvious that the director term and par value items are merely immaterial, “technical” amendments. Apple posits that they are not material because the former merely formalizes an already adopted proposal, while the latter concerns a nominal value change not affecting shareholder rights. Accordingly, Apple claims, shareholders may cast their votes on Proposal No. 2 on the basis of the “blank check” amendment alone. (Opp’n to Green. 15-16.) Yet, in the next breath, Apple contradicts its own argument. Apple states that the director term change is required to conform the Articles to California law, and in contesting irreparable harm, claims that an injunction would burden Apple and its shareholders due to lost reductions in fees expected from the par value change. (Id. at 3, 16, 20-21.) Thus, by Apple’s admission, Proposal No. 2 forces shareholders who oppose the “blank check” amendment to either vote in support of the entire package – registering a false vote in favor of the preferred stock change – or vote down the entire proposal – risking a failed Board election and increased fees. Of course, the “unbundling” rules were intended to prevent just such a dilemma. Moreover, in reviewing Proposal No. 2, one proxy advisory service deemed the director term the “most significant of the proposed changes” (Decl. of Gene D. Levoff, dated Feb. 13, 2103, Green. Doc. No. 16 (“Levoff Decl.”), Ex. E at 10), while another stated that, though “two of the proposed amendments are primarily technical in nature, two others – those involving the implementation of majority voting and the elimination of ‘blank check’ preferred stock– warrant further analysis” (id. Ex. F at 8).

Finally, even if Proposal No. 2’s remaining items were purely technical, it is not apparent that that would excuse compliance with the “unbundling” rules. Permitting Apple to bundle numerous “technical” matters with a single material matter would appear to still violate the letter of the law – which calls for separate votes for “separate matters” – as well as its spirit, because shareholders voting on the “blank check” amendment might still be swayed by the presence of the remaining items such that the resulting vote would not communicate a clear message on the actual popularity of the “blank check” item.

For all these reasons, Apple’s materiality argument is easily rejected.

e. “Pro-Shareholder” Nature of the Amendments

Apple’s final argument, that Proposal No. 2 does not violate the “unbundling” rules because its amendments are all “pro-shareholder,” misapprehends the rules. First, coercive manipulation of shareholder votes is only one of the evils addressed by the “unbundling” rules. Another purpose is to “permit shareholders to communicate to the board of directors their views on each of the matters put to a vote,” a benefit plainly squelched by grouping the director term, par value change, and “blank check” amendments under one heading. Securities Exchange Act Release No. 34-30849, 1992 WL 151037, at *6 (Jun. 23, 1992). Further, the rules do not address intentional coercion alone. Instead, the rules require that shareholders “not be forced to approve or disapprove a package of items and thus approve matters they might not if presented independently.” Id. Thus, application of the “unbundling” rules does not rest on management’s view of the benefits of an amendment – for the simple reason that it is shareholders, and not boards of directors, who have the exclusive right to decide what is, in fact, truly “pro-shareholder.” Here, Greenlight and Gralnick oppose the “blank check” amendment on the grounds that it potentially undermines the value of Apple stock. Thus, to Greenlight and Gralnick, the amendment is anti-shareholder – a view they must be permitted to register. Moreover, even if there were a “pro-shareholder” exception to the “unbundling” rules, it is not clear that Proposal No. 2 would fall under that exception. As stated, Greenlight and Gralnick oppose the “blank check” amendment; following Greenlight’s suit, other shareholders have voiced similar opposition (Green. Reply 3); at least one proxy advisory service recommended a “no” vote on the amendment because it “could frustrate use by the [B]oard of a useful tool to unlock shareholder value” (id. at 2-3); and even proxy advisory services that endorsed Proposal No. 2 found that Apple’s bundling went against shareholder interests (id. at 3; Levoff Decl. Ex. F at 8 (quoting proxy advisory service report finding that “[Apple] has elected to bundle multiple article amendments into a single proposal, a practice which we believe negatively affects shareholders as it prevents them from judging each amendment on its own merits”).) Accordingly, Apple’s view, sincere or not, that Proposal No. 2 is “pro-shareholder” has absolutely no bearing on the Court’s analysis of the SEC’s “unbundling” rules.

* * *

Given the disparate, material nature of the items in Proposal No. 2, it is probable that Apple has improperly bundled four “separate matters” for a single vote. The Court thus concludes that Greenlight and Gralnick have established a “probability of prevailing [that] is ‘better than fifty percent’” and are likely to succeed on the merits of their claims regarding Proposal No. 2.

2. Irreparable Harm

A finding of “irreparable harm” requires “an injury that is not remote or speculative but actual and imminent, and for which a monetary award cannot be adequate compensation.” Tom Doherty Assocs., Inc. v. Saban Entm’t, Inc., 60 F.3d 27, 37 (2d Cir. 1995) (internal quotation marks omitted). While a “showing of irreparable harm is the single most important prerequisite for the issuance of a preliminary injunction,” Faiveley Transp. Malmo AB v. Wabtec Corp., 559 F.3d 110, 118 (2d Cir. 2009) (internal quotation marks omitted), “‘the decision to grant or to deny a preliminary injunction depends in part on a flexible interplay between the likelihood of success and irreparable harm,’” XL Specialty Ins. Co. v. Level Global Investors, L.P., 874 F. Supp. 2d 263, 270-71 (S.D.N.Y. 2012) (quoting Packard Instrument Co. v. ANS, Inc., 416 F.2d 943, 945 (2d Cir. 1969)). Accordingly, a clear likelihood of success on the merits requires a relatively lesser showing of harm.

The Second Circuit has considered irreparable harm in connection with proxy votes, stating that “[i]n passing Section 14(a), Congress sought to avoid a very particular harm – the solicitation of shareholder proxies without adequate disclosure. The SEC rules promulgated under Section 14(a) are intended to level somewhat the playing field for proxy contestants and to force disclosures that promote informed shareholder voting.” MONY Grp., Inc. v. Highfields Capital Mgmt., L.P., 368 F.3d 138, 147-48 (2d Cir. 2004). Thus, “[i]t is well-established that a transaction . . . that is influenced by noncompliance with the disclosure provisions of the various federal securities laws can constitute irreparable harm.” Id. at 147. In that vein, the Second Circuit has found that “[i]mpermissible grouping of voting items [in violation of Rule 14a-4] frustrates fair corporate suffrage and the voting rights of shareholders no less than a misrepresentation or omission in a proxy.” Koppel, 167 F.3d at 135-36 (emphasis added). Perhaps not surprisingly, when faced with probable violations of proxy rules, the Second Circuit has expressed “a strong preference for an injunctive remedy over damages.” Id. at 137.

Having carefully reviewed the record before it, the Court finds that Greenlight and Gralnick face irreparable harm if they are compelled to vote on Proposal No. 2 in violation of SEC rules. By voting either against the slate of amendments and thus against two amendments they support, or for the amendments – including the offending “blank check” provision that they oppose – Greenlight and Gralnick will have been forced to vote on a package of items for which they did not have a single position, and denied the right to inform management of their views on specific items. (Green. Mem. 9; Gral. Mem. 8.)

Apple’s arguments in opposition fundamentally misunderstand the harm alleged. For instance, Apple insists that there is no irreparable harm because the “blank check” amendment will not eliminate the company’s power to issue preferred stock. (Opp’n to Green. 17-18.) But the harm is that Greenlight and Gralnick will be forced to cast an unrepresentative and illegal vote, not that they might be denied their desired substantive outcome. Apple’s contention that any harm is mooted because shareholders could reinstate the “blank check” provision through a later proxy vote is likewise beside the point.³

³ Apple also ignores a glaring concern with its proposal: Apple’s bylaws count shares that are not voted as opposing amendments. (Green. Reply 8.) Accordingly, any shares not voted on Proposal No. 2 would count against eliminating the “blank check” authority. But any shares not voted on a future, restorative amendment would count against reinstating the “blank check” authority. Thus, the deck would be stacked against Greenlight and Gralnick in any effort to restore the status quo with respect to the issuance of preferred stock

If Proposal No. 2 passes, Greenlight and Gralnick will be hampered with an amendment to the Articles that they oppose and which Apple presented illegally. If Proposal No. 2 fails, Greenlight and Gralnick will still have been denied their legal right to an unbundled vote. More importantly, they will have been denied the opportunity to communicate to management the true depth of Proposal No. 2’s unpopularity – offending both purposes of the “unbundling” rules.⁴

⁴ Nevertheless, the Court does agree with Apple that Greenlight and Gralnick were slow to bring suit, waiting six weeks after the preliminary proxy materials were released to file their actions. (See Opp’n to Green. 19 (citing Appalseed Prods., Inc. v. MedianetDigital, Inc., 2012 WL 2700383, at *10 (S.D.N.Y. July 6, 2012); Grout Shield Distribs., LLC v.Elio E. Salvo, Inc., 824 F. Supp. 2d 389, 403 (E.D.N.Y. 2011).) However, this fact alone is not fatal to their motions. While the delay weighed heavily in the Court’s analysis given the time and expense that might have been spared had they acted before the Proxy Statement and Proxy Card were released, the lapse of time is not so “unreasonable” as to support denial of their motions. First, the cases Apple cites involve situations in which plaintiffs waited many months and even years, not weeks, before seeking judicial intervention. Second, those cases deal in continuing harms where the plaintiffs plainly acquiesced to the injury. Here, the injury identified by Greenlight and Gralnick has not yet occurred – and may yet be prevented – making a preliminary injunction the proper form of relief.

In addition, the Court concludes that any lesser remedy would fail to provide Greenlight and Gralnick with adequate relief. Significantly, the Second Circuit states a strong preference for injunctive relief in the proxy context. Koppel, 167 F.3d at 137-38. Not surprisingly, the parties agree that no monetary damages apply. (Tr. 10:9-15.) Further, if the Court were to issue an injunction at a later date, it is unclear whether or how Apple could unwind shareholder-ratified amendments to its Articles – amendments that may trigger filings with the California Secretary of State, as well as multiple other states’ agencies regarding the par value amendment. (Tr. 12:2-16.)

Thus, the Court does not conclude, as Apple suggested at oral argument, that any violation of an SEC rule is a per se harm. (Tr. 30:16-20.) Instead, the Court finds on the facts before it that a vote on Proposal No. 2 would compel Greenlight and Gralnick to vote against their interests, and that the consequences stemming from a vote on Proposal No. 2 would be, to borrow a phrase repeatedly invoked by the parties at oral argument, an exceedingly difficult “egg” to “unscramble.” (Tr. 30:20-22.) Accordingly, the Court finds that Greenlight and Gralnick have established irreparable harm, particularly in light of their strong likelihood of success on the merits. See XL Specialty Ins. Co., 874 F. Supp. 2d at 270-71.

3. Balance of the Hardships

“[T]he balance of hardships inquiry asks which of the two parties would suffer most grievously if the preliminary injunction motion were wrongly decided.” Tradescape.com v. Shivaram, 77 F. Supp. 2d 408, 411 (S.D.N.Y. 1999). Here, the balance of hardships tips in Greenlight’s and Gralnick’s favor, as a denial of their motions would prevent them and thousands of other Apple shareholders from exercising “fair corporate suffrage,” whereas granting their motions will merely require Apple to come into compliance with Rules 14a-4(a)(3) and (b)(1) – at an earlier date than would otherwise inevitably result at the conclusion of this action.

Apple strenuously objects that an injunction would mark “an unprecedented interference [into] the exercise of corporate suffrage by one of the most respected companies in America.” (Tr. 32:3-5.) But Apple fails to acknowledge that this “interference” occurred more than ten years ago when the SEC adopted the “unbundling” rules; the Court now simply requires compliance with the clear dictates of those rules. Apple further argues that its own costs will be sizeable – approximately $3 million to amend and reissue the proxy materials for a special vote after the annual shareholder meeting. (Tr. 40:3-6.) However, this cost is a direct result of Apple’s failure to comply with SEC rules, represents a tiny sum for a company worth approximately $400 billion, and may be avoided if Apple delays consideration of the items in Proposal No. 2 until its next shareholder meeting. (See Green. Reply 9.) Apple also claims that a delayed vote on Proposal No. 2 would impose a “serious financial burden” on it and its shareholders due to the loss of expense reductions expected from the par value change.⁵ (Opp’n to Green. 20-21.) While that may be the case, it would be perverse to permit Apple to proceed with a bundled proxy vote merely because it desires quick passage of one of the items it chose to bundle.

⁵ As discussed, Apple’s insistence that a delayed vote on the par value change would impose serious hardship on the company undermines Apple’s assertions as to the amendment’s purported lack of materiality.

Accordingly, the Court finds that Greenlight and Gralnick have established that the balance of the hardships tips in their favor.

4. The Public Interest

“[T]he public interest and investor protection are well-served when persons faced with solicitations that do not comply with the proxy rules are able to go to court to obtain equitable relief to assure that their opponents play by those rules.” Amicus Brief of the SEC, Koppel, 167 F.3d 125, 1998 WL 34088514, at *15-16. Accordingly, an injunction to force compliance with the securities laws is in the public interest. Apple insists that Proposal No. 2’s “pro-shareholder” bent – to increase shareholder suffrage – is in the public interest and, therefore, the vote should not be barred. (Opp’n to Green. at 21-22.) However, as noted above in connection with Apple’s arguments concerning likelihood of success on the merits, this is precisely the type of substantive judgment that the “unbundling” rules require be left to shareholders, not to courts and certainly not to boards of directors. Because the bundling in Proposal No. 2 denies Apple’s shareholders that opportunity, the Court finds that an injunction would be in the public interest.

* * *

For the foregoing reasons, the Court concludes that Greenlight and Gralnick are likely to succeed on the merits and face irreparable harm if the vote on Proposal No. 2 is permitted to proceed. Further, the Court finds that the balance of hardships tips in Greenlight’s and Gralnick’s favor, and that a preliminary injunction would be in the public interest. Accordingly, Greenlight’s and Gralnick’s motions for a preliminary injunction regarding Proposal No. 2 are granted, and Apple is hereby enjoined from (1) certifying or accepting proxy votes cast in connection with Proposal No. 2, (2) amending its Articles based on such votes, or (3) proceeding with its shareholder meeting in violation of SEC rules.⁶

⁶This relief does not prevent Apple from holding its annual shareholder meeting. Instead, it is limited only to enjoining a vote on Proposal No. 2 at that meeting or Apple’s taking any related action.

B. Proposal No. 4

1. Likelihood of Success on the Merits

Enacted as part of the Dodd-Frank Act in 2010, 15 U.S.C. § 78n-1(a) requires that companies conduct a non-binding shareholder vote on executive compensation at least once every three years. This “say-on-pay” vote was intended “to empower shareholders” by giving them “the ability to hold executives accountable, and to disapprove of misguided incentive schemes.” Laborers’ Local v. Intersil, 868 F. Supp. 2d 838, 848 (N.D. Cal. 2012) (quoting Hearing on Executive Compensation Oversight Before the H. Comm. on Fin. Servs. (Sept. 24, 2010) (statement of Rep. Barney Frank, Chairman, H. Comm. on Financial Services) and 156 Cong. Rec. S5902–01, S5916 (2010) (statement of Sen. Jack Reed)). Item 402(b) of Regulation S-K, promulgated thereunder, requires that, prior to a “say-on-pay” vote, companies must “[d]iscuss the compensation awarded to, earned by, or paid to the named executive officers[;] explain all material elements of the registrant’s compensation of the named executive officers[; and] describe . . . [h]ow the registrant determines the amount (and, where applicable, the formula) for each element to pay.” 17 C.F.R. § 229.402(b)(1)(v). The rule does not impose fiduciary duties or require certain methods for determining compensation. See 15 U.S.C. § 78n-1(c). However, it does give rise to a violation of the Exchange Act for failure to disclose “if either the SEC requirements specifically require disclosure of the omitted information in a proxy statement, or the omission makes statements in the proxy statement materially false or misleading.” Vides v. Amelio, 265 F. Supp. 2d 273, 276-77 (S.D.N.Y. 2003) (internal quotation marks omitted) (discussing CEO compensation).For an omission to be material, there must be“a substantial likelihood that a reasonable shareholder would consider it important in deciding how to act.” See Hutchison v. Deutsche Bank Secs. Inc., 647 F.3d 479, 485 (2d Cir. 2011).

Consistent with SEC rules, Proposal No. 4 seeks shareholder advisory votes to approve Apple’s executive compensation scheme for fiscal year 2012.⁷ (Gral. Mem. 2; Green. Compl. Ex. A 47-49; Opp’n to Gral. 4.)

⁷Apple recommended that shareholders adopt an annual “say-on-pay” requirement, exceeding the three year SEC requirement, which they did in 2011. (See Decl. of Abby F. Rudzin, dated Feb. 13, 2013, Green. Doc. No. 18 (“Rudzin Decl.”), Ex. G at 2.)

In addition, the CD&A in the Proxy Statement describes Apple’s executive compensation scheme. Spanning sixteen pages, the CD&A details the amount of compensation awarded; states the types of awards, including long-term equity awards, cash bonuses, and base salaries; and sets out the guideposts for compensation, including “exceptional personal performance,” “internal equity,” and the input of Apple CEO Cook. (Green. Compl. Ex. A 25-42.) The CD&A also lists the members of the Compensation Committee, along with their backgrounds and qualifications; describes Apple’s independent compensation consultant and details its role in the compensation process; and identifies the peer firms considered in connection with Apple’s compensation decisions, as well as the criteria used in selecting those firms. (Id.)

The report devotes substantial attention to Apple’s long-term equity awards – granted in the form of RSUs – which account for the “majority” of Apple’s executive compensation. As noted above, the CD&A specifically provides that:

The Compensation Committee’s determination of the size of the RSU awards was a subjective determination. The Compensation Committee believed that the RSU awards should be meaningful in size in order to retain [Apple’s] executive team during the CEO transition. There was no formula or peer group “benchmark” used in determining these awards. Rather, the size of the awards was the result of the Compensation Committee’s business judgment, which was informed by the experiences of the members of the Committee, the Committee’s assessment of [Apple’s] performance, the input received from [Apple CEO] Cook, as well as the input and peer group data provided by [Apple’s executive compensation consultant].

(Green. Compl. Ex. A 30.) Nevertheless, Gralnick alleges that this disclosure is insufficient under the SEC “say-on-pay” rules. In particular, Gralnick faults the report for failing to: identify the Compensation Committee’s pertinent “experiences” and “assessment[s],” detail the “input” provided by Apple CEO Cook, and explain the “peer group data” used to determine RSU awards. (Gral. Compl. ¶ 24.) Without such information, Gralnick alleges, Apple’s shareholders cannot make an informed vote on Apple’s executive compensation, particularly with respect to the sizeable and uniform RSU awards. (Id. at ¶ 25; Gral. Mem. 7-8.) As set forth below, the Court disagrees, and finds that the depth and breadth of information disclosed by Apple in the Proxy Statement is plainly sufficient under SEC rules.⁸

⁸It is worth noting that Gralnick does not cite any other complaints regarding the adequacy of the CD&A disclosures. Indeed, one proxy advisory service that recommended approval of Proposal No. 4 stated that it had “thoroughly reviewed [Apple’s CD&A], as well other relevant SEC filings[, and u]pon review of [Apple’s] complete executive compensation program, [fou]nd that [Apple] ha[d] provided adequate disclosure with regard to both its short-term and long-term incentive arrangements.” (Levoff Decl. Ex. F at 15.) Another service that opposed Proposal No. 4 did so on the merits – not because it lacked information to make a recommendation. (Id. Ex. E at 18.)

Gralnick asserts that Apple has not disclosed the Compensation Committee’s “experiences” informing its judgment. Yet, the CD&A lists the Compensation Committee members as well as their backgrounds and qualifications – that is, their “experiences.” (Green. Compl. Ex. A 13-15.) Gralnick further claims that Apple has not disclosed the Compensation Committee’s “assessment” of the company’s performance. However, the CD&A states that “in 2012, [Apple] had the highest market capitalization, revenue growth, and operating income growth of any of the peer companies” – a glowing “assessment” underpinning the “strong financial performance” the Compensation Committee rewarded in 2012. (See id. at 29, 31.) Gralnick continues that the description of Apple CEO Cook’s input in the process is lacking. But the CD&A describes Cook’s input as “regarding the performance and appropriate compensation of the other named executive officers” to which the Compensation Committee gives “considerable weight . . . because of [Cook’s] direct knowledge of each executive officer’s performance and contributions.” (Id. at 28.) In like fashion, Gralnick questions the CD&A’s failure to disclose the “peer group data” considered in connection with the named executive’s compensation, while ignoring that the CD&A (1) describes Apple’s executive compensation consultant as contributing “a range of external market factors, including evolving compensation trends, appropriate peer companies and market survey data”; (2) lists the peer firms considered in setting Apple’s executive compensation; and (3) details the criteria for selecting those firms. (Id.) Finally, Gralnick appears incredulous that Apple would reward its top executives so handsomely and in equal shares. (Tr. 21:13-17.) However, the CD&A pointedly states that Apple compensates based on “exceptional personal performance,” as reflected by Apple’s impressive success, as well as “internal equity,” explaining the similarly sized awards “intended to promote and retain stability within the executive team.” (Green. Compl. Ex. A 29-31.) Finally, the CD&A made clear that executive compensation was set as it was in an attempt to “retain [Apple’s] executive team during the CEO transition” – referring to Apple CEO Steve Jobs’s resignation and death, and Cook’s elevation to CEO – a period of transition and potential turmoil that would explain outsized awards. (Id.) Put simply, Gralnick’s complaint that the CD&A leaves shareholders “totally in the dark” on executive compensation is entirely without basis. (Tr. 21:13.)

[LawPundit comment: "entirely without basis"??? Hardly has the deceased predecessor CEO been gone a month, and already a quarter of a billion dollars of shareholder value are conveniently cashed in by four corporate executives at Apple -- now that is "entirely without basis". What are those $$$ being paid for, just for being there? Where is the desperately needed shareholder protection against rampant company plundering by executives that laws and the courts SHOULD be providing, but are not?]

Indeed, Gralnick concedes that the SEC “say-on-pay” rules do not require Apple to adopt a formula or rational method for determining executive pay. (Tr. 22:20-23:3.) But Gralnick nowhere points to any additional information Apple was required to release to explain its admittedly “subjective” RSU compensation method, nor does he identify any material omissions that rendered the CD&A false or misleading. (Opp’n to Gral. 14; see Gral. Mem. 6-8.) Thus, because Gralnick has failed to identify any material omission in the Proxy Statement, and because the CD&A appears to be wholly compliant with Item 402(b) of Regulation S-K, the Court finds that Gralnick is unlikely to succeed on the merits of his claim regarding Proposal No. 4. For the same reasons, the Court concludes that Gralnick has failed to establish “sufficiently serious questions going to the merits to make them a fair ground for litigation.” Salinger, 607 F.3d 68 at 79.

* * *

Although the Court concludes that Gralnick would be similarly unable to meet his burden regarding the remaining factors relevant to the preliminary injunction analysis – irreparable harm, balance of equities, and public interest – the Court need not reach those questions given his failure to establish the first element, likelihood of success on the merits. See eBay Inc., 547 U.S. at 391. Accordingly, Gralnick’s motion regarding Proposal No. 4 is denied.

IV. CONCLUSION

For the reasons stated above, the Court finds that Greenlight and Gralnick have demonstrated by a “clear showing” that they have satisfied the elements for a preliminary injunction regarding Proposal No. 2. Accordingly, their motions regarding Proposal No. 2 are GRANTED, and Apple is HEREBY ENJOINED from (1) certifying or accepting proxy votes cast in connection with Proposal No. 2, (2) amending its Articles based on such votes, or (3) proceeding with its shareholder meeting in violation of SEC rules concerning Proposal No. 2. However, the Court finds that Gralnick has not demonstrated by a “clear showing” that he satisfies the elements for a preliminary injunction regarding Proposal No. 4. Accordingly, his motion regarding Proposal No. 4 is DENIED.

Further, pursuant to Federal Rule of Civil Procedure 65(c), a preliminary injunction must be secured by “an amount that the court considers proper to pay the costs and damages sustained by any party found to have been wrongfully enjoined or restrained.” However, Apple does not state an appropriate amount for a bond, nor does it request one. Accordingly, the Court will not order Greenlight and Gralnick to post a bond at this time.

Finally, IT IS HEREBY ORDERED THAT, no later than March 1, 2013, the parties shall submit a joint letter outlining the next contemplated steps in this case, as well as a joint proposed case management plan and scheduling order. A template can be found at http://nysd.uscourts.gov/cases/show.php?db=judge_info&id=347. [Link text is original but the functioning online link was hyperlinked by LawPundit]

SO ORDERED.

[judge's signature]

RICHARD J. SULLIVAN

United States District Judge

Dated: February 22,2013

New York, New York

* * *

Greenlight is represented by Ashley F. Waters, Christopher Michael Egleson, Michael A. Asaro, and Mitchell P. Hurley, Esqs., of Akin Gump Strauss Hauer & Feld, One Bryant Park, New York, New York 10036.

Gralnick is represented by A. Arnold Gershon, Michael Arthur Toomey, and William J. Ban, Esqs., of Barrack, Rodos & Bacine, 425 Park Avenue, Suite 3100, New York, New York 10022, as well as Jeffrey Alan Barrack, Esq., of Barrack, Rodos & Bacine, Two Commerce Square, 2001 Market Street, Suite 3300, Philadelphia, Pennsylvania 19103.

Apple is represented by Andrew Jay Frackman and Abby Faith Rudzin, Esqs., of O'Melveny & Myers LLP, 7 Times Square, New York, New York 10036.

Rembrandt vs. Zuck in the Patent Wars: Saoi?

2013-02-12T00:37:00.002+01:00

Who initially "invented" social networking?
What about things such as the Facebook "like" button,
"shared news" or a "shared timeline"?

Ever heard of "Jos" van der Meer and Surfbook.com? No one has.
But that makes no difference in the world of patent law.

Outrageously broad patents granted 10 years ago by the USPTO might surreally suggest in the eyes of that existing patent law that the real pioneer "inventor" of important social media technology was the late Dutch inventor Joannes Jozef ["Jos"] Everardus Van Der Meer.

Nonsense, of course, except in our legally warped patent system.

As a consequence of van der Meer's broad patents, Facebook is facing a patent infringement lawsuit filed on February 4, 2013 in the United States District Court for the Eastern District of Virginia, Alexandria Division, a venue in which Chief Judge Rebecca Beach Smith, the first female federal judge in Virginia, in 2011 upheld Pfizer in a celebrated patent case against generic producer Teva involving a spam champion pharmaceutical product that we do not name here in order not to land in the spam category on many servers. Looks like a good choce of venue for patent trolls.

Ars Technica and RembrandtIP.com have copies of the complaint online.
[Note: "Virginia" is misspelled as "Virgina" on the complaint, which led us to think this might be a post-Pfizer-case hoax. However, the filing law firm Fish & Richardson has a substantiating press release, so that the misspelling on the complaint must be a typo -- or, in a world of remote and improbable coincidences, patent misspelling history repeating? See our previous postings for a clue to that mystery. It put us on the alert.]

One can also read at PR Newswire that:

Fish & Richardson Files Patent Infringement Lawsuit for Rembrandt Social Media in Virginia Against Facebook [ Inc. and] Add This Inc.

The patent infringement cites to U.S. Patents:

No. 6,289,362 [the '362 patent]
and 6,415,316 [the '316 patent]

originally filed by "Jos" van der Meer with the USPTO on September 1, 1998.

A patent was granted by the USPTO on September 11, 2001 for the '362 patent and on July 2, 2002 for the '316 patent.

Both patents cover broad aspects of social networking technology that are used by almost all social media today, arguably including things like the Facebook "like" button or "shared news items" and "shared timelines", technology anticipated by, indeed, if we are to follow the legal complaint, patented by van der Meer in his "web diary" patents as cited above.

Facebook is alleged to have infringed both of the above-cited patents while Add This Inc. is alleged to have infringed the "362" patent. In principle, the patents could be said to apply to similar technology used by many modern social networking media portals.

Fish & Richardson have filed the suit in the name of Rembrandt Social Media, LP, assignee of the heirs of the late "Jos" van der Meer, who during his lifetime filed for the domain "Surfbook" at www.surfbook.com several years prior to the existence of Facebook, Inc..

We checked, and The Wayback Machine traces the Surfbook domain back to at least September 25, 2001, whereas Facebook first came into existence in 2003 viz. 2004, depending on the source that one reads.

Fish & Richardson as the filing law firm are not just anybody, but as noted in that report, they are a "global law firm": indeed, they are surely "the largest patent-centric law firm in the country", as noted by Joe Mullin at Ars Technica.

In turn, Rembrandt Social Media, owned by an anonymous sole owner, has been extremely successful in bringing patent-trolling law suits against large companies, which might be an expression of previous expertise in this field. For some reason, upon seeing that RembrandtIP is headquartered in Bala Cynwyd, we were reminded of the song "Tippecanoe and Tyler Too". "Knowledge" is a key word, in a way. Again, we have no proof for that riddle.

Let us say that we remain strong opponents to the granting of these kinds of broad patents by the USPTO or foreign patent offices. The problem is that legislators, judges, legal scholars, patent applicants, patent lawyers and patent offices have created the patent octopus that we have today, so that this case is just one more outgrowth of a greatly flawed patent system.

Accordingly, one can not blame patent holders for taking every advantage that the law gives them. The patent trolls are the smart guys in this game. They are just "playing the system". Nothing wrong with that, I guess. It's legal.

As an example, everyone can thus be glad and breathe a sigh of relief, as reported by Joe Mullin at Wired in Texas Jury Strikes Down Patent Troll’s Claim to Own the Interactive Web, that powerful patent troll Eolas recently lost a critical jury trial in Texas. Still, a great number companies headed by weak persons previously "settled" their claims with Eolas [as Mullin writes: "Apple, Argosy Publishing, Blockbuster, Citigroup, eBay, Frito-Lay, JP Morgan Chase, New Frontier Media, Office Depot, Perot Systems, Playboy Enterprises International, Rent-A-Center, Sun Microsystems (bought by Oracle while this litigation was underway), and Texas Instruments."] and thus perhaps put a lot of money into bank accounts just waiting for new patent vistas to conquer. The battle goes on.

If Apple's ridiculously obvious and hence rightly unpatentable "bounce back" patent netted $1 billion against Samsung in the Koh Court in California, then the stakes here for these two van der Meer patents must be worth many times that -- to people "playing the system".

The smart guys are taking all the money, sometimes from each other, while the masses grind away. We are beginning to view this all as an entertaining and curious spectacle.

We repeat our view that patent laws should be amended to permit patenting only of specific, implemented, "working" inventions. Broad claims should be prohibited on the very rational grounds that such expansive claims are claims to ideas only, applying to implementations viz. products that do not exist.

That would eliminate many of the strings of claims that accompany nearly every patent application in our modern world, as inventors invent only "A", but include also non-invented "B to Z" and sometimes ""AA to ZZ as well" in their patent claims, because it can't hurt, and because the USPTO or foreign patent offices often cluelessly grant those overly broad claims by default (or sloth).

For some documentation of this matter, we can point out that

RembrandtIP.com issued a Press Release:

"Press Release
FOR IMMEDIATE RELEASE
February 5, 2012
CONTACT
Jesse Dungan
Infinite PR
jdungan@infinitepr.com
(415) 732-7881

Rembrandt Social Media, LP Files Suit Against Facebook and AddThis, for Patent Infringement

February 5, 2013, Bala Cynwyd, PA — Rembrandt IP Management, LLC (“Rembrandt”) announced today that its affiliate, Rembrandt Social Media, LP, has filed a patent infringement lawsuit against Facebook, Inc. and AddThis, Inc. in the U.S. District Court for the Eastern District of Virginia. The patents at issue involve a “Method and Apparatus for Implementing a Web Page Diary,” (US Patent 6,415,316) and a “System and Method for Generating, Transferring and Using an Annotated Universal Address” (US Patent 6,289,362).

The inventor, “Jos” van der Meer, developed his ideas in his Netherlands-based company, which now does business as “Aduna.” After Jos’ passing, the van der Meer family, through Aduna, partnered with Rembrandt to enforce the patents and will share in the litigation proceeds.

“Rembrandt strives to help inventors and patent owners receive the credit and compensation they deserve,” said Dr. Paul Schneck, Rembrandt’s Chairman. “We work to level the playing field for patent owners who do not have the expertise and/or capital, to enforce their rights against companies which use their inventions without paying for them.”

“Years before Facebook and AddThis, Jos van der Meer conceived of and patented core aspects of social media,” Dr. Schneck continues. “The United States patent system is designed to give inventors an exclusive right to practice their inventions. Facebook and AddThis are using the ideas disclosed in Jos’ patents without permission or payment. Through this litigation, Rembrandt Social Media hopes to recover payment for the unauthorized usage of patents by Facebook and AddThis.”

Rembrandt Social Media, LP is represented in this matter by Fish & Richardson, P.C.

About Rembrandt IP Management, LLC

Since 2004, Rembrandt has provided patent owners with the necessary financial capital, in-depth research and analysis, industry expertise, and hands-on litigation management to help monetize their inventions. Rembrandt is comprised of professionals experienced in each of the areas critical to commercializing infringed intellectual property including scientists, attorneys, engineers, licensing executives, and market analysts.
Rembrandt aligns with, or acquires patents from, leading innovative corporations, universities, research institutions, the investment community, and entrepreneurial and creative individuals. Rembrandt frequently augments its internal team by engaging “best in class” outside legal and technical experts to assess opportunities and provide their talent and knowledge to obtain a return on infringed intellectual property. For more information please visit www.RembrandtIP.com."

RembrandtIP.com also has a copy of the complaint filed here.

For more news coverage, see:

PRNewswire at Fish & Richardson Files Patent Infringement Lawsuit for Rembrandt Social Media in Virginia Against Facebook, Add This Inc.
Joe Mullin at Ars Technica in Before Facebook there was “Surfbook”—now pay up: A well-funded patent-holding company seeks a royalty on the "Like" button
David Cohen at AllFacebook.com in Facebook Faces Patent Suit Over Timeline, Like Button
Facebook sued over 'like' button at BBC News
Rosa Golijan, NBC News, in Deceased programmer invented 'Like' button before Facebook, says lawyer

Saoi?

US Federal Trade Commission a Paper Tiger? Jon Leibowitz Resigns as F.T.C. Chairman Effective February 15, 2013 and No Replacement in Place

2013-02-10T17:47:00.003+01:00

We have been quite disappointed in recent years at the limited effectiveness of the U.S. Federal Trade Commission (FTC) in protecting online privacy rights and we read at the FTC and in various news reports, also at the New York Times, that Jon Leibowitz [has resigned] as F.T.C. Chairman effective February 15, 2013.

Is this because his protective efforts have been politically thwarted?

In an optimally functioning system of government, an FTC chairmanship successor would already be in place, ensuring that this important federal agency has uninterrupted leadership to continue to conduct its important work.

However, political partisanship may be an issue here, where it has no business being. See Ed Silverstein at TechZone360 in Could Be Partisan Bickering over Who Will Replace Leibowitz on FTC.

We ourselves care not what political party or gender the new Chairperson has, but we expect people to be EFFECTIVE, especially in protecting the Internet privacy rights of users.

See FTC Issues Performance and Accountability Report for Fiscal Year 2012 and the the text of the report at Federal Trade Commission Performance and Accountability Report (Fiscal Year 2012), which states:

"FY 2012 PERFORMANCE HIGHLIGHTS
Consumer Privacy

The FTC protects consumer privacy through policy work, law enforcement, and consumer and business education. In March 2012, the Commission issued a final report outlining best practices for businesses to protect the privacy of American consumers and give them greater control over the collection and use of their personal data. The FTC also brought actions charging that Facebook and Google did not keep promises they made about privacy. Settlement orders in both cases protect more than one billion users worldwide."

We see no evidence of settlement compliance follow-up at the FTC. This is surprising for an agency of reportedly over 1000 staff.

At Facebook this settlement apparently has had little significant impact on privacy rights violations that occur due to opt-ins and opt-outs which are so confusing that recently even a Zuckerberg family member complained about publication of private photos beyond the intended audience.

The so-called "settlement" with Facebook is particularly aggravating since it did not even amount to a fine, which should have been assessed in considerable amount against the company for in part outrageous privacy rights violations that in Europe have resulted in take-down sanctions by regulators.

For the situation in the USA, see David Munkittrick at the Privacy Law Blog in Shaking Up the Settlement Process: FTC Reconsiders Whether Companies Can Deny Wrongdoing While Settling Privacy Violation Claims.

We have pointed out that, that in our opinion, Facebook is currently and openly violating privacy rights in violation of the settlement agreement reached with the FTC, and the FTC is apparently doing nothing about it.

This is now not surprising, given the situation at the FTC.

The leader of the FTC is going and no new leader is there to take the reigns.
What can be expected of such a leaderless government organization?

Data Protection and Privacy Laws in the United States and Europe are Worlds Apart

2013-02-09T23:47:00.001+01:00

Natasha Singer has the story at The New York Times in
Consumer Data Protection Laws, an Ocean Apart.

Given the ever more confusing opt-ins and opt-outs at Facebook, such that even the Zuckerberg Family is confused about its privacy rights, as we recently reported at LawPundit, and given the privacy violations at Facebook via its search of private data -- the ultimate in data mining of private materials for commercial profit -- we venture a prediction that American privacy and data protection laws are much more likely to move in the direction of more protective European Union laws than vice versa.

Mandatory Facebook Deletion of All EU Facial Recognition Data Confirmed by Irish and German Data Protection Regulators

2013-02-09T23:25:00.002+01:00

The battle against Facebook privacy rights violations continues in Europe, as reported at PCWorld by Loek Essers in Regulators confirm Facebook deleted all EU facial recognition data.

See also for background a preceding article from last year.

Privacy Settings at Facebook Privacy So Unclear That Even a Zuckerberg Family Private Photo is Shared and Reshared on the Web

2013-02-09T23:14:00.001+01:00

Rebecca Greenfield has the story at The Atlantic Wire in Facebook Privacy Is So Confusing Even the Zuckerberg Family Photo Isn't Private

The article concludes:

"So the lessons here is twofold: Facebook privacy settings are too confusing, and if you really don't want intimate photos out there, don't put 'em on Facebook. But also, don't expect to hide something if you do — everything can be shared and re-shared these days."

Again, we keep wondering what the people at the United States FTC (Federal Trade Commission) are doing about this?

And what is the European Union doing?

See Natasha Lomas at TechCrunch in

Facebook Lobbying Europe On “Unreasonable And Unrealistic” Privacy Law Reform — But EC Commissioner Doesn’t Sound Like She’s For Turning

where we can read that Facebook "had to turn off facial recognition in the EU" in September, 2012.

The answer is that we need much tighter privacy rights protection than we presently have, not only in the United States, but also in the EU.

Patents on Human Genes? U.S. Supreme Court Answer Likely to Be "No", but the Ultimate Issue Down the Road is the Patentability of cDNA (Complementary DNA) viz. Is a Split Hair viz. Split Gene an Invention?

2013-02-09T22:08:00.000+01:00

Is an orange, a lemon, a fig or a tomato split in half and "peeled", "a patentable invention"? How about a tree split by a logger into firewood? Patent-eligible? How about the patentability of a split hair?
Or is the excerpt of a paragraph of text taken from a book "a new patentable invention" just because it has been "lifted" from the original whole?

What will be the U.S. Supreme Court decision concerning the patentability of human genes and "split genes" in a case currently before the Court as Association for Molecular Pathology v. Myriad Genetics, Inc., Docket No., 12-398, Argument Date: TBD ("to be determined"), which presents the following question:

"QUESTION PRESENTED:
Many patients seek genetic testing to see if they have mutations in their
genes that are associated with a significantly increased risk of breast or ovarian cancer. Respondent Myriad Genetics obtained patents on two human genes that correlate to this risk, known as BRCA1 and BRCA2. These patents claim every naturally-occurring version of those genes, including mutations, on the theory that Myriad invented something patent--eligible simply by removing ("isolating") the genes from the body. Petitioners are primarily medical professionals who regularly use routine, conventional genetic testing methods to examine genes, but are prohibited from examining the human genes that Myriad claims to own. This case therefore presents the following questions:

1. Are human genes patentable?

2. Did the court of appeals err in upholding a method claim by Myriad that
is irreconcilable with this Court's ruling in Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289 (2012)?

3. Did the court of appeals err in adopting a new and inflexible rule,
contrary to normal standing rules and this Court's decision in MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007), that petitioners who have been indisputably deterred by Myriad's "active enforcement" of its patent rights nonetheless lack standing to challenge those patents absent evidence that they have been personally threatened with an infringement action?"

What has been invented by man? and what by God?

James D. Watson was the co-discoverer of genetic DNA together with Francis Crick, and both he and Crick and Maurice Wilkins won the 1962 Nobel Prize in Medicine "for their discoveries concerning the molecular structure of nucleic acids and its significance for information transfer in living material".

Watson has filed an amicus ("friend of the court") brief in this case and has written there as follows:

"Human genes should not be patented.... First, a human gene is fundamentally unique--unlike any ordinary "composition of matter." A gene conveys information--the instructions for life. As a product of nature, a human gene's primary purpose is to encode the information for creating proteins, enzymes, cells, and all the other components that make us who we are.... Life's instructions ought not be controlled by legal monopolies created at the whim of Congress or the courts.

Second, much of what we known about human genes traces back to the Human Genome Project, which was structured as a public works project, intended to benefit everyone by deciphering our genetic code... [M]uch but not all of the human genome was dedicated to the public.... It was a mistake by the Patent Office to issue patents on human genes and a mistake by those who filed for those patents.

Third, human gene patents are not necessary to encourage scientists.... Innovation will be rewarded based on [developments in technologies using human genes], not the patenting of the human gene....

"Human genes...are useful because they convey vital information....."

In our view, awarding ANYONE any kind of patent or other monopoly on this information, in whole or in part, is simply theft of that universal information. What belongs to all is being stolen for the benefit of the few.

In terms of the law and the patentability of inventions and discoveries, when we talk about any form of human genes, we must ask: where is "the inventive step" or the "non-obvious" human discovery involved when "splitting" genes or "splitting" DNA that already exists? Cutting things apart is not "a discovery". Imagine if firewood were patentable. Whatever is found was already there.

Andrew Torrance at SCOTUSblog in Nothing under the sun that is made of man suggests that the U.S. Supreme Court "likely" will reject the patenting of human genes in Association for Molecular Pathology v. Myriad Genetics, Inc.
[recommended citation at SCOTUSblog: Andrew Torrance, Nothing under the sun that is made of man, SCOTUSblog (Feb. 7, 2013, 12:24 PM), http://www.scotusblog.com/2013/02/nothing-under-the-sun-that-is-made-of-man/ ]

We agree. See our previous postings on this topic here and here.

Alas, however, that may not solve the "actual" practical legal problem presented in this case, where a finding that human genes are not patentable may not really resolve the real issue in this case.

One must fear, in fact that the U.S. Supreme Court could follow the simplistic and errant line of argumentation of the United States Government in its amicus brief which concludes that:

"The judgment of the court of appeals should be affirmed insofar as it holds that cDNA is patent-eligible, and reversed insofar as it holds that isolated but otherwise unmodified DNA is patent-eligible."

The U.S. Government is thus urging that unmodified DNA be seen as a product of nature, but "modified" DNA be seen as "an invention", even if that invention consists primarily of using and monopolizing code information that has always been there in the original product of nature.

We ourselves would never tolerate such an illogically split result, but it is a result which might be seen to provide Supreme Court Justices with "an easy out" in this case, replacing individual critical thinking by the judges.

In this manner they could issue a holding meeting "popular" demand that human genes are not patentable, but could at the same time then nevertheless carve out a large and significant "hair-splitting" viz. "gene-splitting" patent exception for "split-off" DNA. We might compare this to a teaspoon of sugar spread on a split lemon. NOT found in nature. Or we might compare it to a clipped paragraph from a book to which proprietary introductory and closing texts are newly appended to create "a new invention".

If such a terrible decision on the law were to issue from the current U.S. Supreme Court, one would subsequently have no recourse but to argue that even if cDNA were found patent-eligible (as "split" from original human genes) it would nevertheless not be patentable because the "splitting" is obvious.

Making patentability in this field dependent on the obviousness of the splitting would, however, be a very unsatisfactory standard. To government institutions such as the USPTO and the U.S. Court of Appeals for the Federal Circuit, apparently virtually "NOTHING" appears to be obvious.

The U.S. Government writes in its amicus brief about cDNA as follows:

"Petitioners contend (Br. 49-53) that cDNAs are not patent-eligible because they contain the same protein-coding information -- i.e., exon sequences -- as DNA in the body. But the properties of any product originally derived from nature, including the bacterium in Chakrabarty, can be traced to the operation of natural principles. While the coding properties of cDNA molecules' exons are determined by nature, those properties operate within a molecule (a DNA strand with the regulatory and intron regions spliced out) that does not exist in nature and that has increased utility relative to naturally occurring genetic materials or isolated but unmodified DNA. The fact that a cDNA incorporates nucleotide sequences whose significance is derived from nature therefore does not mean that the molecule as a whole is a product of nature.⁵ See Diehr, 450 U.S. at 187."

__________

⁵It is possible that, given the prevailing level of knowledge in biotechnological fields, future patent applications directed to cDNAs and other synthesized DNA molecules may rejected as obvious. 35 U.S.C. 103; see In re Kubin, 561 F.3d 1351, 1358-1361 (Fed. Cir. 2009)."

If cDNA code information were found to be patent eligible in general as being "split" from an original non-patentable gene (as if the coded part were more patentable than the coded whole), the patent approach pointed out in footnote 5 would then be the correct one as a patent defense.

It would then in fact be the ONLY defense remaining, since "creating" cDNA's
-- for those who want to call it "creating" rather than "splitting away from" --
is child's play these days if you have the right kit.

Indeed, creating cDNA is so simply done that it has already generated a lively market for "cDNA Synthesis Kits". Just plug that term into Google to view links to any number of them.

We quote from the SMART cDNA Synthesis Kit description online:

"SMART (Switching Mechanism at 5’ End of RNA Template) is a unique technology that allows the efficient incorporation of known sequences at both ends of cDNA during first strand synthesis, without adaptor ligation. The presence of these known sequences is crucial for a number of downstream applications including amplification, RACE, and library construction. While a wide variety of technologies can be employed to take advantage of these known sequences, the simplicity and efficiency of the single-step SMART process permits unparalleled sensitivity and ensures that full-length cDNA is generated and amplified."

As written at the Wikipedia:

"In genetics, complementary DNA (cDNA) is DNA synthesized from a messenger RNA (mRNA) template in a reaction catalysed by the enzymes reverse transcriptase and DNA polymerase.^[1] cDNA is often used to clone eukaryotic genes in prokaryotes. When scientists want to express a specific protein in a cell that does not normally express that protein (i.e., heterologous expression), they will transfer the cDNA that codes for the protein to the recipient cell. cDNA is also produced by retroviruses (such as HIV-1, HIV-2, Simian Immunodeficiency Virus, etc.) which is integrated into its host's genome where it creates a provirus....

Though there are several methods for doing so, cDNA is most often synthesized from mature (fully spliced) mRNA using the enzyme reverse transcriptase. This enzyme operates on a single strand of mRNA, generating its complementary DNA based on the pairing of RNA base pairs (A, U, G and C) to their DNA complements (T, A, C and G respectively).

To obtain eukaryotic cDNA whose introns have been removed:

A eukaryotic cell transcribes the DNA (from genes) into RNA (pre-mRNA).

The same cell processes the pre-mRNA strands by removing introns, and adding a poly-A tail and 5’ Methyl-Guanine cap.

This mixture of mature mRNA strands is extracted from the cell. The Poly-A tail of the post transcription mRNA can be taken advantage of with oligo(dT) beads in an affinity chromatography assay.

A poly-T oligonucleotide primer is hybridized onto the poly-A tail of the mature mRNA template, or random hexamer primers can be added which contain every possible 6 base single strand of DNA and can therefore hybridize anywhere on the RNA (Reverse transcriptase requires this double-stranded segment as a primer to start its operation.)

Reverse transcriptase is added, along with deoxynucleotide triphosphates (A, T, G, C). This synthesizes one complementary strand of DNA hybridized to the original mRNA strand.

To synthesize an additional DNA strand, you need to digest the RNA of the hybrid strand, using an enzyme like RNase H, or through alkali digestion method.

After digestion of the RNA, a single stranded DNA (ssDNA) is left and because single stranded nucleic acids are hydrophobic, it tends to loop around itself. It is likely that the ssDNA forms a hairpin loop at the 3' end.

From the hairpin loop, a DNA polymerase can then use it as a primer to transcribe a complementary sequence for the ss cDNA.

Now, you should be left with a double stranded cDNA with identical sequence as the mRNA of interest.

The reverse transcriptase scans the mature mRNA and synthesizes a sequence of DNA that complements the mRNA template. This strand of DNA is complementary DNA."

In other words, cDNA is simply a modified form of mRNA that is "created" from KNOWN coded information according to fixed rules that are essentially the same for all cDNAs. There is NO INVENTION as such. Unpatentable coded information is simply "reformatted". That does not make the info patentable.

We ourselves would not find cDNA itself patent eligible in ANY form. Rather, if anything should be patented here, it is the cDNA synthesis kits -- and ONLY these.

The correct decision in this case is to view human genes -- as explained by James D. Watson previously -- as living strands of coded information. The innumerable parts of that coded information make up a gigantic book, i.e. the book of the coded instructions for life, for making a human being. Taking a clip of that information out of that book and perhaps cutting off the chapter heading or dropping the ending period of a sentence still does not make that text or information a new "invention" of any man or commercial undertaking.

It remains at all times the SAME coded original information of nature, and hence is NOT patentable, in ANY form. So our opinion.

Disabling viz. Deleting Google+ Content or Deleting a Google Profile

2013-02-07T14:03:00.000+01:00

Google+ is a badly designed social networking alternative to Facebook that is equally fraught with the invasive violation of privacy rights via a virtually incomprehensible and unnecessarily complex jumble of opt-ins and opt-outs and we have just also deleted our Google plus content.

We had to go to CNET and Ed Rhee's article to discover how to delete a Google+ account.

The links we used -- this may not work for you, we can not guarantee it will work, were:

https://www.google.com/settings/plus

At the very bottom of that page, barely discoverable is a link to disable Google+ at the sentence:

"You can disable Google+ (or delete your entire Google profile) here."

The link at "here" above takes you to
https://plus.google.com/u/0/downgrade/
where you can either

Delete Google+ content

which removes access to Google+, while Gmail, Google Docs, Google Calendar, and other useful Google services remain untouched, e.g. photos uploaded via Picasa to blogs, etc.

(or you can completely)

Delete your entire Google profile

which is not advisable if you use other Google services, because it may deny you access to useful services such as Gmail etc.

Google+ is designed so that you are virtually forced to use the social networking service, even if you do not want it, and this begins with the fact that the misleading term "You+" is the first menu item on Google's menu bar of services WHEN you do not use it (!) or have opted out of it (!). I would like Google to remove that from that location at the menu bar.

The You+ is replaced by Google+ if you -- as in our case --to find out what happens when you click it -- click "Upgrade" -- which already opts you into Google+ without you knowing that is what "upgrade" means. Since when does clicking an "upgrade" button automatically operate to "opt in" to a service when it is not clear what the conditions of upgrade are.

That camouflaged "opt-in" is followed by a string of linked pages that operate to lock the user into the networking system. If you want to get out, you have to waste time searching around to find out how you can get out of Google+.

Leaving Google+ is a process which Google has made nearly as difficult as in Facebook, because there is no direct link or menu item for disabling or deleting the service at Google+ pages.

Rather, you have to go to the round "gear tool button" way over on the other side of the website page, quite a stretch for those having a 24-inch screen, click that, and then click numerous times after that before you can opt out of anything.

Again, as in the case of Facebook, we find that be clear, intentional fraud on the user, since "opting in" is made one-click easy, and almost imperceptible, while "opting out" is not even a part of Google+ pages but is tucked away at another location where an inexperienced user will find it only with difficulty.

One role of the law as a normative process of society is to put a stop to that kind of thing everywhere on the Internet. Legal opting-out should be just as easy as legal opting-in. Anything else is intentional fraud on the user.