Recently, in Myspace, Inc. v. GraphOn Corp.(Fed. Cir. 2012), the Federal Circuit (at least Judges Newman and Plager) chose to avoid a determination of validity under 35 U.S.C. 101 Subject Matter Eligibility, and instead used Novelty and Obviousness (35 U.S.C. 102, 103) grounds to invalidate the patents at issue. The court analogized to the Constitutional avoidance doctrine to avoid a finding of subject matter eligibility.
The Myspace “avoidance” concept is a prudent approach, and encourages good patent policy. It allows broad patentable subject matter as intended by Congress and the Constitution, and also encourages the use of novelty and obviousness laws as the true “Conditions for Patentability”- as they are titled. Further, the avoidance concept limits novelty/obviousness issues from being confused with patentable subject matter considerations- which is so often the case.
One notable case of confusion of novelty with patentable subject matter can be seen in the dissent, thereby proving the majority’s point to some extent. When arguing for the use of 101 to invalidate patents, the dissent states, on page 7:
“Many software and business method patents simply describe a basic, well-known concept that has been implemented or applied using conventional computer technology.”
So, the dissent (Judge Mayer) is admitting that the patents he dislikes are “well-known” and thus not new. Accordingly, by the dissent’s own reasoning, novelty is actually the proper tool to invalidate, or perhaps a coupling of references establishing obviousness under 103: one showing the well-known concept and another showing that the computer implementation would be obvious to a PHOSITA. This type of confusion of novelty/obviousness with subject matter issues is pervasive in patentable subject matter disputes, and demonstrates the value of favoring invalidation and rejection using novelty and obviousness grounds.
The dissent does raise a good point that the patents at issue are low quality or “bad” patents. However, I disagree with the dissent that their allowance is because sections 102 and 103 are unfit to prevent the issuance of such bad patents. Indeed, in invalidating the patents at issues, the majority opinion made it quite clear that novelty and obviousness (102 and 103) are perfectly suitable for invalidating (or preventing) low quality patents. Instead, I suspect that “Teaching/Suggestion/Motivation” test and generally the narrow application of obviousness pre-KSR had quite a bit to do with the allowance of these, and other “bad” patents. Certainly more so than a lax application of section 101.
Hopefully, Myspace signals a new approach to dealing with subject matter issues under section 101. If so, it will allow invalidation of patents as needed without confusing the use of 101 with 102/103 and further muddying the subject matter jurisprudence.
Christian Louboutin holds a federal trademark registration on its red soled shoes. The red soles are (at least mostly) unique to this shoe line, and allow shoe enthusiasts to identify the shoes as Louboutin’s. When Yves Saint Laurent (YSL) started selling red soled shoes too, Louboutin sued, initially moving for a preliminary injunction to prevent sale of the shoes. In August, a federal judge denied the motion (Text Here). Recently, a 2d Circuit appeals board heard oral arguments in Louboutin v. Yves Saint Laurent America appealing a denial of a preliminary injunction.
The district court Judge’s decision raises a number of interesting issues (as well as an epic “parade of horribles” tirade). When I first heard about the case, I thought it was a slam dunk in favor of Louboutin. After reading the decision however, I am not sure what side I stand on.
On one hand, people do identify red soled shoes with Louboutin. On the other hand, there is evidence that the red sole is a “functional” color choice, and thus non-deserving of trademark protection. Also the judge draws a distinction between color in the fashion industry and other industries. It is difficult to say whether this distinction is proper or not.
What stands out to me is the discussion on pages 19 and 20 where Mr. Louboutin is quoted talking about how great the red is, “sexy” etc. This admission may be damning for Louboutin’s case, as it strongly leads the Judge to suspect the color is “functional.” But is the “functional” prohibition so broad that anything but a completely arbitrary color selection renders the color un-trademarkable? It seems that is the direction that this court and others are leaning.
It seems to me that any color must be chosen for some reason. Owens Corning pink could indicate warmth, making it functional. Qualtiex green could be considered “clean” and therefore functional. Is the key then, for a color trademark holder to just keep mum as to why they picked the color? If that ends up being the case, it seems like a silly rule.
I look forward to finding where the line is drawn. We’ll soon find out what the appeals court decides. The final outcome of this case could potentially be a game changer in the color trademark world. In any event the battle between Louboutin and YSL should be fun to watch.
The Supreme Court recently held in Golan v. Holder (summary) that it is acceptable for Congress to restore copyright in a number (potentially millions) of foreign works that have been in the public domain. This decision reflects the general political stance that there is no such thing as too much copyright. Further, it give Congress very broad power to remove works from the public domain however they choose.
The concern that this ruling creates is if a rights holder or former rights holder pushes Congress (i.e. gives them enough money) there is nothing preventing Congress from re-granting or extending copyright protection for as long as they want. Presumably, this could apply to patents too.
In allowing Congress to take old works out of the public domain, this ruling fails to consider copyright policy entirely. It does nothing to promote progress in the sciences and useful arts. Instead, the ruling removes potentially millions of works from the public domain, stifles creativity by preventing derivative works, and limits First Amendment free expression. Yes, in the decision, Justice Ginsberg uses clever wordplay and manages to wiggle around all of these issues. Still, her arguments are transparent, and weak at best.
Copyrights inherently have a freedom of expression aspect to them, in that a creator is allowed to limit expression of their copyrighted works. Once the works enter the public domain, however, the First Amendment allows their distribution, use, and modification. The Constitution provides this limit on free speech to encourage creativity and allow people to profit from their creations. On the other hand, this limitation on free expression must be balanced by limiting the term of protection to allow others to eventually build off this creativity. In Golan, the balance is way off- and likely was not even considered.
Justice Breyer is on the right track in his dissent when he pointed out that the “newness” requirement has always been a necessary part of the granting of intellectual property protection. This newness requirement is offended by reinstating copyright in works already in the public domain. Unfortunately, his argument wasn’t enough to persuade a majority of the Court.
Golan v. Holder is just another step in the continuing trend of enhancing and extending copyrights, to the detriment of the arts, creativity, and the policies that copyright law seeks to promote. The ruling further opens the door for abuse of the copyright system by rights holders, as well as further more substantial limitations of the public domain and free expression.
Seen to the right is a photo of a tag on my J. Crew coat. After taking it off yesterday I happened to notice the “Reg. U.S. Pat. Off. No. 77388. Curious that J. Crew would have such an old patent on a coat, I pulled up Google Patents to see what it looked like. Boy was I disappointed when 77,388 pulled up this, titled “Improvement in the Manufacture of Glue.” Glue? What?
Maybe they meant that it was a design patent? Nope. D77,388 is a design patent for wallpaper. Ugly wallpaper at that. How would you like this plastered all over your wall?
So, unless I am missing something (am I missing something?) J. Crew just came out of left field with this one. C’mon J. Crew. You can do better than that.
It is lucky for J. Crew that 35 U.S.C. 292, the false marking prohibition has been wiped out in the new iteration of US Patent law. Otherwise, I would be all over this one. It should be an easy win right? False marking is obvious, and intent to deceive should be a no brainer, this marking was clearly made just to make the product look “vintage”, or something. Further, I would argue that the 5 minutes I spent online finding out that this marking was a sham is worth at least $500 per false mark! J. Crew must have sold a couple thousand of these. I could settle for a million dollar payout, I guess…
Ok, so maybe a million is a little much. In any event it doesn’t matter because false marking isn’t a cause of action any more. However, this demonstrates that at some point false marking could get ridiculous. If nonsense markings start to be put all over unpatented articles, how much weight can be given to a legitimate patent marking in terms of intentional infringement? Technically it would not matter, but from an equitable perspective, I can see this argument persuading a judge to limit intentional infringement damages.
According to one examiner, and his supervisor, at least one group of examiners and other PTO officers decided at a “meeting” that card games are per se unpatentable subject matter. While it is sweet that the examiners all got together and decided that, unfortunately, their decision is contrary to patent law as interpreted by the Supreme Court. Based on this improper decision by PTO employees, the only way to overcome a 101 subject matter rejection in this particular art group for a patent application for a card game will be to appeal. Appealing such an issue wastes clients time and money to overcome these improper rejections.
Patentability for card games should be no less patentable than any method of manipulation of an object. The fact that the claims are tied to another statutory class defined in section 101 is more than enough to support patentability. Surely, a new and non-obvious method of using a hammer, or any other device would be patentable. Why then would a new and non-obvious method of using a playing card not be patentable? There is no support for it in law, or common sense.
PTO Reasoning for non-patentability of a card game is as follows: For a method claims, a machine or transformation of matter is required. Using a narrow and overly literal interpretation of this test, a machine must be a computing device, and transformation of matter must be something quite substantial (chemical reaction, etc.). Card games (with physical cards moving around) do not involve a computer, nor a sufficient transformation of matter.
This analysis fails in a number of ways. Perhaps its most blatant deficiency is the blind adherence to the Federal Circuit’s machine or transformation (MoT) test of Bilski that was overturned by the Supreme Court. Further, the analysis misunderstands the policy underlying the subject matter issues with Bilski and other business method claims: preventing claims on solely abstract mental steps. Obviously, nobody intended with the development of the MoT test to exclude legitimately patentable claims to card games, board games and the like.
In reality, card games are well within the scope of patentable subject matter, and satisfy the MoT test based on any reasonable interpretation. In one sense, the cards could be interpreted as a “machine” with which the method steps are performed. In another sense, the manipulation of the cards could be interpreted as a transformation of matter in their manipulation when carrying out the method steps. Either way, the steps of manipulating the physical cards passes the test.
Further, the Supreme Court has ruled that the MoT test is not the exclusive test, and card game claims would surely be patentable under any other test.
From a policy perspective, there is no reasoning to support exclusion of card games from the realm of patentable subject matter. Card games that utilize physical cards are not abstract mental steps, they are not laws of nature, and are not a physical phenomena. As such, they must be patentable subject matter.
In cases like this, unfortunately the Examiners are the ones bearing the brunt of patent practitioner frustration. The blame should not be placed on them. Instead, blame goes to the PTO administration for failing to develop acceptable guidelines for claim analysis under the MoT test, and for failing to train examiners to understand the policy of the patentable subject matter tests. By understanding the policy and reasoning for patentable subject matter exclusions, examiners will be able to make informed decisions on the issue, instead of blindly adhering to an overly rigid test that was overturned almost two years ago.
The newly enacted patent law amendment, the America Invents Act (AIA), will go into force on March 16, 2013. One major change of the act is that it eliminates the one year on sale grace period of current 35 U.S.C. 102(b). This elimination hurts smaller inventive entities who likely will not know of the soon to be enacted instant on sale bar, and/or cannot afford to seek patent protection. This change, not the much-feared first to file, will have the biggest impact on those seeking patent protection.
Current 35 U.S.C. 102(b) provides: “A person shall be entitled to a patent unless…(b) the invention was… in public use or on sale in this country, more than one year prior to the date of application for patent in the United States.” Therefore, the invention can be on sale or in public use for up to a year before the filing of the patent application.
Alternatively, section 102(a)(1) of the AIA states that “A person shall be entitled to a patent unless – (1) the claimed invention was … in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.” Thus, as soon as an invention is in public use, on sale, or otherwise available to the public, it is barred from patentability. While an exception is provided in 102(b)(1) for “disclosures” made by the inventor (joint inventor etc…) within a year of filing, the exception applies to disclosures only, and on its face does not cover public use or sale.
The AIA is quite ambiguous and leaves much for courts to sort out. As far as any exceptions are concerned, it must be assumed that the only one year grace period provided is for “disclosures” by the inventor.
The elimination of the on sale grace period will have its greatest negative impact on inventive entities that are not fully versed in patent law. Namely, this includes small companies and individual inventors, who often sell products before seeking patent protection. Of course, this is not advisable even under the present regime, but the selling typically starts before seeking patent advice. Under the new law, this unadvised sale leads to a total forfeiture of patent protection on the invention sold. Forfeiture of patent rights for a small inventive entity can be a fatal blow, particularly when a company with greater distribution and advertising ability copies the invention.
Obviously, larger more savvy companies will not have any problem with the elimination of the on sale bar. Their innovation process is streamlined and any innovation will be sure (barring some sort of mistake) to have patent(s) filed on it well before sale. Therefore, the change should have no impact on more established innovation companies.
In fact, the elimination of the on sale bar should benefit larger companies because they will be even more able to copy ideas from small entities who unknowingly abandoned patentability. Without a patent as a bargaining chip, a small entity will be hard pressed to compete against a large company with large advertising revenues, superior distribution and the like.
The elimination of the on sale grace period fails to promote good patent policy to protect inventors. Instead, it likely squeezes out many small time inventors, favors large companies, and further allows the large companies to capitalize on small timer’s unknowing abandonment their rights for patent protection.
Ed. Note: Not surprisingly, many large inventive companies and particularly manufacturers/distributors lobbied hard for AIA passage. See http://firststreetresearch.files.wordpress.com/2011/11/first-street-report-lobbying-the-america-invents-act.pdf
About a year ago, I argued that, in Comedy III Productions v. Saderup, sketches of Three Stooges characters imprinted on T-Shirts should be permissible because four Stooges episodes have been released to the public domain. Derivative works based on the public domain works are permissible – that is the point of the public domain. Unfortunately, because the defendant’s lawyers did not raise the issue the California courts did not consider the issue.
Now, this exact issue is being considered by the Eighth Circuit in Warner Bros. Entertainment, et al. v. X One X Productions, et al. In this case, the copyright holders of the movie Wizard of Oz (on copyright) are suing a company producing T-Shirts with images taken from off-copyright promotional materials. The copyright holders argue that despite the public domain status of the promotional materials, the T-shirts still infringe the copyrighted movie. Surprisingly and sadly, the district court agreed.
This case presents a very similar fact pattern to that in Comedy III Productions v. Saderup. In my previous post on that case, I point out that allowing actors (or anyone else) to control off-copyright public domain works would run so contrary to Constitutional policy that it would be untenable. Copyrights are intended to protect for a limited time, once a work is in the public domain it is fair game. In Warner Bros. the copyright holders are attempting to circumvent this public domain concept that is at the heart of copyright policy.
To rule that a copyright holder of one work can control any use of related but off-copyright work is ludicrous. For example, that would mean that someone who made a parodied Mona Lisa could prevent another from creating a parody of the Mona Lisa -allowing them to effectively control copyright on the Mona Lisa itself. Further, as noted on Patently-O in the comments, if a copyright holder continued to release works involving the same characters, they could maintain a perpetual copyright.
If the Eighth Circuit affirms the district court’s decision, the question must be asked: What is the point of a public domain? A line must be drawn somewhere. We can only hope that the Eighth Circuit will exercise restraint and prevent copyright law from continuing to balloon and further encompass the public domain.
Thanks to Patently-O for providing coverage on this interesting case.