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Patent Troll Loses Claim Over Ownership of the Internet.

Supreme Court Commentator — 2012-02-13T14:26:01-05:00

Michael Doyle and his company Eolas Technologies, which claimed patent ownership in interactive elements on the web, had its claims struck down by a Texas federal jury.

Tyler, Texas (WIRED) -- After threatening web companies for more than a decade, Michael Doyle and his patent-holding company Eolas Technologies — named after the Irish word for knowledge — may be finished.

An eight-member federal jury in East Texas deliberated Thursday for just a few hours before concluding that all of Eolas' asserted claims of ownership to technology allowing access to the interactive web were invalid.

That means the three upcoming trials that were scheduled to rule on infringement and damages, for Google, Yahoo and other companies, have been canceled. The eight defendant companies who resisted the lawsuits won't pay anything to Eolas or its partner, the University of California, for using the web.

Eolas maintained its patents entitled the company to royalty payments from just about anyone running a website with "interactive" features, like rotating pictures or streaming video. The chief issue in the case was whether the first computer program that allowed access to an "interactive web" was created by the little-known Chicago biologist Doyle, who runs Eolas out of Chicago. Or was it one of the web pioneers put on the stand by the defendant companies — such as Pei-Yuan Wei and his Viola browser, or Dave Raggett and his tag?

The dueling teams of lawyers have spent millions creating elaborate presentations, trying for the last three days to convince a jury of average folks in a federal district court in eastern Texas that their side was right.

If the jury had upheld the patents, there would have been a potentially brutal damages phase in which Google, YouTube, Yahoo, Amazon, Adobe, JC Penney, CDW Corp. and Staples would have been sued for infringement and been asked for more than $600 million in damages, with the majority of that coming from Google and Yahoo.

The Eolas patents were denounced for years before this week's landmark trial, but managed to survive repeated re-exams at the United States Patent and Trade Office.

However, Thursday's verdict is likely a setback Eolas can't overcome. It may well be appealed, but that will be a long process, and in the meantime Eolas won't be able to go after new targets.

After the trial, Judge Leonard Davis visited with the jurors a while, as is his custom. They were awed, I'm told—as they often are—why such an important web case ended up in Tyler.

Apparently they were a little star-struck by Tim Berners-Lee, although you certainly couldn't tell during trial.

At "Rick's on the Square" opposite the courthouse, defense lawyers were celebrating. There was a giddy atmosphere; these folks truly felt like they saved the Web today.

As for the winner's reactions: Yahoo spokeswoman Dana Lengkeek said: "Yahoo is pleased with the outcome of the case and the jury's decision, and we thank the jury for their time and commitment to this case. Yahoo respects intellectual property and will continue to protect its freedom to operate by defending itself against meritless claims."

Google spokesman Jim Prosser was less effusive. "We are pleased that the court found the patents invalid, as it affirms our assertion that the claims are without merit," Prosser said.

Despite winning, Amazon declined to comment.

Lead Eolas attorney Mike McKool did not return a call seeking comment.

As for the many companies that settled with Eolas, they might be regretting that pragmatic decision in light of the verdict.

Those companies include: 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.

Women Inventors On the Rise

Supreme Court Commentator — 2012-02-03T10:10:23-05:00

In March the USPTO will unveil a new study regarding women inventors and patents. In 2010, the U.S. saw a 35% increase in women receiving patents from the the prior year, totaling over 22,000 patents granted to women that year. The USPTO, in conjunction with the National Women's Business Council, will pay tribute to women inventors during March and will unveil the 2011 results of the study. With AIA changes, patent applications will now be tracked by gender. The USPTO has tipped its hat a bit prior to the Mar. 1 unveiling, to indicate that the number of women applying for and receiving patents and trademarks over the past 5 yrs. continues to rise.

USPTO to Host Roadshow Series

Supreme Court Commentator — 2012-02-03T10:07:44-05:00

As part of the process of policy making for implementation of the America Invents Act (AIA), the USPTO will be hosting a series of sessions for gathering public comment on proposed implementation and policies for implementing the AIA changes signed into law by Congress. This roadshow will take place this spring across the U.S. to give independent inventors the opportunity to meet with USPTO officials and comment. It begins in Alexandria, VA (Feb. 17), continues through the US.: Silicon Valley (Feb. 24), Salt Lake City (Feb. 27), Dallas (Feb. 29), Fort Lauderdale (Mar. 2), Boston (Mar. 5) and Chicago (Mar. 7).

This is your opportunity to be heard and give input to USPTO proposed policies for new AIA created laws including:

(i) the Office of Enrollment and Discipline (OED) statute of limitation

(ii) inventor’s oath and declaration,

(iii) third-party submission of prior art in a patent application,

(iv) citation of prior art in a patent file,

(v) supplemental examination,

(vi) post-grant review,

(vii) inter partes review,

(viii) the transitional program for covered business methods, and

(ix) derivation.

The USPTO proposed policies for these areas are available published on the Federal Register. The roadshows will be held at USPTO resource centers, where independent inventors may receive patenting assistance.

Michigan to Gain a USPTO Patent Office

Supreme Court Commentator — 2012-01-28T08:00:00-05:00

The USPTO is planning to open a satellite patent office in Detroit. The USPTO has had difficulty retaining enough patent examiners in recent years to wade through the increasingly large backlog of patent applications awaiting examination. One reason for the difficultly in retaining patent talent is the high cost of living in the Alexandria, Virginia area near the USPTO headquarters, as compared to the modest patent examiner salary. In an effort to retain talent, the USPTO will be opening three new satellite patent offices. The patent office has already identified Detroit as one location and the other two locations are up in the air. You can provide input to the PTO as to where the offices should be located. The deadline for public comment on the future PTO office locations is January 30, 2012.

The USPTO requests comments to be in writing and submitted to satelliteoffices@uspto,gov and to provide information that supports the USPTO's purposes of establishing satellite offices to increase outreach activities to better connect patent filers and innovators with the offices, enhance patent examiner retention and improve recruitment of patent examiners.

PTO Hires New Judges to Tackle Backlog of Appeals

Supreme Court Commentator — 2012-01-27T15:00:00-05:00

The USPTO Director just announced that the PTO has hired 14 new administrative jurists to the Board of Patent Appeals, in an attempt to wade through the backlog of patent appeals stemming from patent prosecution decisions. If a patent applicant does not agree with the outcome of prosecution of her patent application, she has some opportunity to appeal the examiner's decision with the Board of Patent Appeals. Board of Patent Appeals decisions may be appealed to federal court, to the Court of Appeals for the Federal Circuit, which is the appellate court that handles all patent appeals in the U.S.

Patent Reform Isn't Over

Supreme Court Commentator — 2012-01-27T10:34:47-05:00

As part of the patent reform act signed into law, Congress tasked with the PTO with making changes, but did not instruct the PTO how to implement changes. Rather, Congress put ongoing requirements on the USPTO for change, in the form of proposing rules changes to implement the new law, gathering public opinion and comment regarding the proposed changes and devising final rules changes to implement many of the new provisions in the America Invents Act (AIA). For example, in December, the PTO published proposed rules for supplemental examination and to revise reexamination fees. The PTO also announced public hearings and request for comments on genetic diagnostic testing per the AIA. If you are interested in having your opinion heard by those who will be making the rules for the patent landscape for years to come, you have opportunity to get involved.

How long does it take for the USPTO to look at my patent application?

Supreme Court Commentator — 2012-01-27T10:20:43-05:00

We've come to expect a 1-2 year time period before the USPTO issues a first office action in response to a newly filed utility patent application. And that's typically just the beginning of the prosecution back and forth between a patent applicant and the patent examiner in trying to obtain allowance of the patent claims. Under the America Invents Act (the patent reform legislation), the USPTO Director optimistically reported yesterday that the backlog of patent applications awaiting prosecution is now down to only 660,000. That still seems like a lot, but he reports that the PTO has just hired a fleet of new examiners to attempt to tackle the backlogged cases.

There also is an excellerated examination option, which provides for a quick patent examination period (12 months). This option sets additional requirements upon a patent applicant, including payment of higher fees. But for time sensitive inventions – where an inventor benefits greatly from having an issued patent now – this option is worth considering.

International Patent Protection for Small Businesses and Prior User Rights Studies

Supreme Court Commentator — 2011-10-21T12:28:09-04:00

The Federal Circuit Bar Association: International Patent Protection for Small Businesses and Prior User Rights Studies

The USPTO is presently working on the International Patent Protection for Small Businesses and Prior User Rights Studies, both of which have reports due to Congress in mid-January. They recently published two Federal Register Notices (available on the PTO website) seeking written comments and/or testimony in a hearing setting from the public. The Notices are also available here:

International Patent Protection for Small Businesses Study

Prior User Rights Study

The agency would greatly benefit from public input on both studies, either through written comments and/or oral testimony at the hearings they have planned. Here are the logistics for those hearings:

• International Patent Protection: Thursday, October 27th from 1 to 4 PM at the USPTO and Tuesday, November 1st from 9 AM to noon at USC Law School in Los Angeles
• Prior User Rights: Tuesday, October 25th from 8:30 to 11:30 AM at the USPTO

Thank you, and we hope you can take advantage of this opportunity to participate in the dialogue about the America Invents Act.

Patent Reform Imminent

Supreme Court Commentator — 2011-09-09T14:30:37-04:00

U.S. Congress has been discussing patent reform for a number of years now. Various versions of bills have been tossed around and debated at length, and the patent issues generally have then been put on a shelf, taking back burner to other important issues requiring the attention of Congress. It really had gotten to the “never cry wolf” stage for if/when anything was to come of the patent reform discussions and patent lawyers had grown weary with breath holding wondering if change was going to take place. However, this week, both the House and the Senate have passed bills to make the proposed patent reforms into law. The legislation has landed on President Obama’s desk. It appears that he will sign the pending bill into law shortly.

There are several dramatic changes of which every patent attorney and client should be aware.
One big change is pro-University and small inventor. Specifically, the America Invents Act will decrease USPTO fees for Universities, small entities and non-profits. This is great news – the fee reduction is up to 50%, depending upon the type of fee. It will also decrease the percentage of certain invention-related royalties that must be paid to the federal government.

Patent reform laws likely to go into effect include a fundamental patent philosophy change taking the U.S. from a first-to-invent patenting system to a first-to-file patent system. This dramatically impacts patent prosecution and is aimed to bring the U.S. patent system more in line with patenting in foreign countries. Under this file-to-file system, generally the person who gets to the patent office to file an application first will win. This means that patenting strategy will shift to a strategy of filing sooner rather than later to ensure rights are not lost. Should an inventor delay in filing an application, she could lose rights to a competitor who filed first.

Patent litigation may also change. Imminent patent reform laws impact patent litigation with creation of a new post patent issue review system at the USPTO enabling anyone, including patent litigation defendants, to challenge the patent. This proceeding, which does not take place in Federal Court, is supposed to be a more cost effective way to handle patent disputes. It is a mechanism to challenge the validity of a patent. The judging body will be a panel of technically trained Administrative Patent Judges. This new proceeding is similar to inter partes reexamination proceedings already in existence. There is a discrete timeframe when this option is available as an alternative to patent litigation. It impacts discovery, as well as may create estoppel preventing a patent litigant from re-litigating issues decided before the USPTO panel. There will be much strategizing by patent litigation lawyers to work this new mechanism into patent litigation strategy.

Proposed patent reform laws eliminate patent interference proceedings altogether. This really is a by-product of switching from a first to invent to a first to file patent program. No longer must inventorship timing disputes be heard by the U.S.P.T.O. Contests regarding who filed first and derivation contests regarding whether an application was directed to an invention not invented by the applicant, but by another, will still be heard by the U.S.P.T.O.

Patent reform laws likely to go into effect include expansion of prior user rights, which likely strengthens trade secret rights. The pending legislation defines new prior user rights which may trump a later issued patent, such that a company would not be forced to pay royalties for continuing to practice technologies pre-dating the patent. In this sense, there is added incentive in some circumstances to keep innovations secret rather than patent them, and a new defense to patent infringement is gained. This new category of rights will impact patent application filing and patent prosecution strategy and decisions.

Patent reform laws plan to limit who may bring a claim for false marking. A false marking claim is a legal action against someone who claims that they have patent protection for a good, by marking it with a patent number, when they do not. This may happen most often in a context where a patent has expired, but the patent holder has not halted its patent marking. The new laws would narrow the group of persons able to bring such actions from “any person” to only the United States or a party proving competitive injury. This law would go into effect immediately, and appears to be an attempt to prevent the recent trend to file such suits by persons seeking to make a business out of doing so.

Finally, pending patent reform will likely increase many USPTO fees over time. Specifically, the America Invents Act gives fee setting authority to the USPTO, such that it would have the ability to set its own fees. This added systemic flexibility may result in more frequent changes to the fee structures. It also provides greater funding for the PTO, which will hopefully result in more timely examination of currently backlogged pending applications.

The imminent changes impact patenting strategies for patent prosecution and patent litigation. The reform is dramatic enough to warrant an audit of patenting policies, procedures and strategies by all inventors and companies seeking patent protection. New strategies are needed to deal with the patent reform.

Senate Passes Landmark Bill to Overhaul U.S. Patent System

Supreme Court Commentator — 2011-09-09T14:25:57-04:00

On September 8, 2011, a late congress passed legislation dubbed “The America Invents Act” in an overwhelming 89-9 vote. President Obama is expected to sign it into law within the next week. In this CNNMoney report by David Goldman, the bill will mandate three things:

It will transition the country to a "first to file" system, instead of the current "first to invent" approach.
The patent reform bill will help provide adequate funding to the overwhelmed patent office by allowing it to set and keep its own fees.
The bill will create a post-grant review process intended to clear up legal battles before they start.

The U.S. Patent and Trademark Office are hopeful that the reforms will improve the patent-granting process, prevent challenges to pending patents, create new jobs within the patent office, and help with much-needed IT resources.