Reexamination Requests : US PTO Litigation Alert™

Who is Responsible for Reexamination Delays?

| October 4, 2010

A number of patent bloggers criticize the PTO for the long pendency of reexamination proceedings.  The statutory requirement of “special dispatch” for reexaminations is often uttered in tones oozing with sarcasm.  But who is responsible for the length of reexaminations?

Surprisingly (or unsurprisingly), at least part of the blame lies with the large number of papers filed by the private parties.  In recent years the docket sheets of some reexaminations have come to resemble the docket sheets of heavily litigated District Court cases.  Lawyers in disputes over commercially important patents “leave no stone unturned” in pursuit of their clients’ interests.

An example of such zealous representation is summarized in the PTO Director’s denial of the patentee’s petition for reconsideration in Inter partes Reexamination 95/000,332.  The ‘332 reexamination involved U.S. Patent No. 7,228,383 which was the subject of an infringement action between Visto and Research in Motion, that settled in July 2009.
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C2 Communications Patent Claims Rejected

| October 4, 2010

In February we reported that two requests for reexamination had been granted against C2 Communications’ U.S. Patent No. 6,243,373 which claims a method for routing a call between two telephones over a public computer network, a so-called “voice-over-Internet protocol.”  The ‘373 patent has been the subject of a number of successful law suits, including cases against AT&T, Verizon and Qwest.  The PTO has now rejected all 24 claims of the ‘373 patent.

For the most part, the PTO adopted the rejections proposed in the requests: one set of rejections based on the request was filed by the “patent buster” Electronic Frontier Foundation, and three sets of rejections based on the request filed by PAETEC.

C2 Communications had sued PAETEC for infringement of the ‘373 patent, but the case was dismissed at the end of August, presumably on the basis of a settlement agreement.

Reexamination Counsel For Both Patentee and Accused Infringer May Access Protective Order Information

| September 28, 2010

Judge Howard R. Lloyd of the Northern District of California has resolved a protective order dispute in Vasudevan Software, Inc. v. IBM, et al., by allowing the patentee’s in-house counsel to participate in a reexamination for the patent-in-suit, despite having access to the accused infringer’s “Highly Confidential” information.

The parties had agreed to a “prosecution bar,” so that the in-house counsel for the patentee – Vasudevan – (with access to the accused infringer’s protective order information) could not prosecute patents or patent applications related to the patent-in-suit.  The parties also agreed that the in-house counsel for the accused infringers – IBM and Oracle – could sign the protective order, thereby gaining access to the patentee’s highly confidential information, and still participate in a reexamination of the patent.    The accused infringers, however, strongly objected to the patentee’s in-house counsel defending the reexamination for the patentee.
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Card Activation Case: A Correction

| September 28, 2010

Yesterday we posted a story about the reexamination of a patent owned by Card Activation and the effects that the reexamination might have on a parallel law suit.  We commented the amendment of two independent claims to recite the subject of two dependent claims “would preclude Card Activation from recovering damages accrued for infringement prior to last week’s reexamination certificate issue,” citing 35 U.S.C. § 307(b).  One of our subscribers subsequently pointed out that the comment misstated the law.

The general rule under § 307(b) is that an amendment of a claim in reexamination that “substantively changes” the scope of the claim extinguishes damages for acts of infringement that occurred before the date of the reexamination certificate.  Laitram Corp. v. NEC Corp., 163 F.3d 1342, 1346, 49 USPQ2d 1199 (Fed. Cir. 1998).  On the other hand, an amendment of an independent claim that merely incorporates the subject matter of a dependent claim is not treated as “substantive.”  Bloom Engineering Co., Inc. v. North American Mfg. Co., Inc., 129 F.3d 1247, 1250, 44 USPQ2d 1859, 1861 (Fed. Cir. 1997).

We will leave to the courts the question of how these legal principles apply to the reexamined claims of the Card Activation patent.  We do plan, however, to post a study on claim amendments in reexamination and the effect of those amendments on subsequent litigation.

We apologize for our error and thank our subscriber.

Reexamination Request against Wireless Game Controller Patent among those Filed Week of September 20th

| September 28, 2010

The most interesting reexamination request last week was filed against a patent that claims a radio frequency remote game controller and is owned by the Canadian company Eleven Engineering (Ex parte No. 22).  Last November Eleven Engineering and its U.S. subsidiary sued Nintendo, Sony and Microsoft for infringement of that patent and two others.  The accused games are Nintendo’s Wii Remote and Wii Balance Board, Sony’s Playstation3, and Microsoft’s Xbox 360.  The case is before Judge Stark in Delaware and has not progressed beyond the pleading stage.

Another notable request was filed by Volkswagen against a car brake safety patent (Inter partes No. 3).  The patent is owned by 55 Brake LLC who sued 12 major automobile companies for infringement of that patent.  The case is in Idaho and a trial is scheduled to begin in March 2011.

The following inter partes requests were filed:

(1)   95/001,446 (electronically filed) – Information not currently available.

(2)   95/001,448 (electronically filed) – U.S. Patent No. 6,858,280 owned by Technology Applications, Inc. and entitled MICROSPHERE INSULATION SYSTEMS.  Filed September 20, 2010.

(3)   95/001,449 (electronically filed) – U.S. Patent No. 6,450,587 owned by 55 Brake LLC and entitled VEHICLE BRAKE SAFETY SYSTEM APPARATUS AND METHODS.  Filed September 23, 2010 by Volkswagen Group of America, Inc, a subsidiary of Volkswagen AG.  The ‘587 patent is currently the subject of a litigation styled 55 Brake LLC v. Audi of America, Inc. et al. (D. Idaho, Case No. 1:08-cv-00177-BLW, filed Apr. 21, 2008).
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Victory for Card Activation?

| September 27, 2010

The news service IP LAW360 is reporting this morning a victory for Card Activation in the reexamination of its U.S. Patent No. 6,032,859 – specifically that the PTO issued last week a reexamination certificate confirming the patentability of most of the claims of the ‘859 patent.  That patent claims a “method for processing debit purchases” and appears to have particular application for the now popular gift cards.  Card Activation has sued quite a number of high-profile consumer product companies, such as 7-Eleven and Costco, and is said to have sent threat letters to more than 600 retailers.

The PTO’s Notice of Intent to Issue Ex Parte Reexamination Certificate, dated June 23, however, tells a somewhat more complicated story.
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Licensee Avoids Royalty Payments by Filing Reexamination

| September 22, 2010

Under Lear, Inc. v. Adkins, 395 U.S. 653 (1969), a patent licensee is free to challenge the validity of the licensor’s patent.  If the licensee’s challenge is successful, the licensee is not obligated to pay any royalties that accrue under the license, including royalties that accrue from the date of the challenge.  Normally, a licensee makes such a challenge by filing a declaratory judgment action.  The Fifth Circuit Court of Appeals’ ruling in DuVal Wiedmann, LLC v. InfoRocket.com, Inc. last Friday proved that reexamination may be just as effective as declaratory judgment.

In that case, the licensee filed a reexamination request against the licensed patent and refused to pay the annual royalty.  The PTO granted the reexamination, and the licensor sued the licensee for breach of the license agreement. Ultimately, the PTO issued a reexamination certificate, but only after amendment of the all the remaining patent claims.

The Fifth Circuit ruled in the breach of contract action that the licensee, because of the reexamination, owed no royalty to the licensor.
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Reexamination Requests Filed the Week of September 13th

| September 22, 2010

Perhaps the most important reexamination request last week was filed by Google against a Xerox patent (Ex parte No. 6).  The patent is the subject of a pending law suit in Delaware between the parties.  Earlier this month, Magistrate Judge Mary Pat Thynge issued a decision in that case allowing Google to use counsel from its litigation team for any reexamination – essentially, she concluded that the potential harm to Google of limiting its choice of reexamination counsel outweighed the risk of improper use by Google’s reexamination counsel of Xerox’s protective order information.

Another interesting request was filed against an Amylin patent (Ex parte No. 13) for exendins which are peptide hormones that regulate blood glucose levels.  A reexamination (95/000,276) has been pending since 2007 against similar Amylin extendins patent – the ‘276 reexamination is noteworthy in that it features that rare creature: the reexamination continuation.  The earlier Amylin reexamination was filed by competitor ConjuChem.

The following inter partes requests were filed:

(1)   95/001,445 (electronically filed) – U.S. Patent No. 7,507,845 owned by SD Lizenzverwertungsgesellschaft mbH & Co. KG and entitled PROCESS FOR PRODUCTION OF AN OLEFIN OXIDE.  Filed September 13, 2010 by Shell Oil Company.

(2)   95/001,446 (electronically filed) – Information not currently available.

(3)   95/001,447 (electronically filed) – U.S. Patent No. 6,907,530 owned by SSL Services LLC and entitled SECURE INTERNET APPLICATIONS WITH MOBILE CODE.  Filed September 18, 2010 by Citrix Systems, Inc.  The ‘530 patent (along with the ‘011 patent – see below) is current the subject of a litigation styled SSL Services, LLC v. Citrix Systems, Inc. et al. (E.D. Tex., Case No.2:08-cv-00158-TJW, filed Apr. 11, 2008).
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Examiner’s “Hypothetical” Does not Create a Written Description Problem

| September 17, 2010

An inter partes reexamination, pending since November 2004, came to a favorable conclusion for the patentee today, with the PTO Board reversing the examiner on a written description issue.  Essentially the Board found in Light & Motion Industries, Inc. v. Sartek, LLC (95/000,060) that two claim limitations had written description support in a provisional application, thereby removing the examiner’s primary prior art reference.

The claimed invention was a portable high intensity lighting system for underwater use by divers.  The claims included the limitation that a “ballast container [be] potted with a material to eliminate vacant spaces therein so that said potting material is in direct contact with the interior of said ballast container” (emphasis added).  The examiner acknowledged the disclosure in the provisional application that the ballast container “has been filled with a material to eliminate vacant spaces within.”   But he then imagined a container lined with an insulator and then filled with potting material, so that the potting material would not be in direct contact with the interior of the container.

The Board disagreed, dismissing the examiner’s insulator-lined container as a “hypothetical scenario.”
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Reexamination Requests Filed the Week of September 6th

| September 15, 2010

Last week saw two blockbuster sets of filings – Shared Marketing Services filed ex parte requests against five eComSystems patents (6) to (10), and Illinois Tool Works filed ex parte requests against seven patents belonging to Digi-Star (13) to (19).  Illinois Tool has appeared in many reexaminations over the years.  In both instances, the respective parties are in litigation.

Two other ex parte reexamination requests may prove to be commercially significant, one filed against a Hitachi semiconductor patent (25), and another filed against a Kubota tractor patent (30).  The names of the companies that filed these requests are not apparent from the files.

Finally, information regarding the last of the eight PubPat requests against Abbott, inter partes (8), became available last week.

The following inter partes requests were filed:

(1)   95/001,432 (electronically filed) – Information not currently available.

(2)   95/001,439 (electronically filed) – U.S. Patent No. 7,726,029 owned by Spellbound Development Group, Inc. and entitled SAFETY CUTTING APPARATUS.  Filed September 7, 2010 by Pacific Handy Cutter, Inc.  The ‘029 patent (along with the ‘640 and ‘928 patents – see below) is currently the subject of a litigation styled Spellbound Development Group, Inc. v. Pacific Handy Cutter, Inc. (C.D. Cal., Case No. 8:09-cv-00951-DOC-AN, filed Aug. 17, 2009).

(3)   95/001,440 (electronically filed) – U.S. Patent No. 7,130,821 owned by Versata Development Group, Inc. and entitled METHOD AND APPARATUS FOR PRODUCT COMPARISON.  Filed September 8, 2010 by Internet Brands, Inc., AutoData Solutions Co., and AutoData Solutions, Inc.  The ‘821 patent (along with the ‘029 and ‘928 patents – see above and below) is currently the subject of a litigation styled Versata Software, Inc. v. Internet Brands, Inc. (E.D. Tex., Case No. 2:08-cv-00313-CE, filed Aug. 8, 2008).
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