Mister Softee Bitten By Waiver Under FRCP 50

January 18, 2010

I’ve written before about how dangerous waiver is for lawyers.  It lurks everywhere, like sharp coral just a few inches beneath the water off an inviting tropical beach. In Microsoft’s recent loss to i4i in federal court in Texas affirmed by the Federal Circuit, Mister Softee (stock trader slang for Microsoft), found itself hung up on a reef with razor sharp coral when the Federal Circuit may have refused to reverse a $290 million trial verdict on what the court considered a waiver technicality. As every experienced trial lawyer knows, trials are a virtual waiver landmine – if you don’t proffer the evidence a judge excludes, you’ve waived it on appeal.  If you don’t object to jury instructions, you waive the right to challenge them on appeal.  This list seems almost endless, and there’s nothing a federal court of appeals likes more than to dismiss an argument on the grounds that it was, somehow, waived during trial. This having been said, there are a few potential waivers points that lawyers absolutely MUST keep in mind – to the point where the documents that will avoid the waiver should be prepared before trial, subject only to updating as the trial progresses and the moment of truth (or waiver) is reached.  These waivers arise under FRCP 50, and are: Before the case goes to the jury the defendant MUST move for judgment…

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Listen to Oral Argument in Bilski v. Kappos

December 10, 2009

Well, sort of. You can wait until the end of the term to hear oral argument in Bilski v. Kappos, or you can listen to Professor Doug Lichtman’s students’ impassioned reading of the transcript, on the superb Intellectual Property Colloquium.  I found this reading to be very accessible – a new twist on audiobooks. IP Colloquium is by far my favorite legal podcast.  Professor Lichtman has great guests and provides thoughtful commentary.  This Shakespearean treatment of an appeal hearing is inspired. (Nice summary of the background of Bilski, and what’s at issue, on Bill Trout’s blog). And, some nice quotes from the justices, trying to figure out the limits of patent protection.  Could a patent protect – “somebody who writes a book on how to win friends and influence people?””horse whisperers?””a method for speed dating?” “a great wonderful, really original method of teaching antitrust law?” “actuarial tables and risk formulas?” In the meantime the CAFC is applying its “machine or transformation” test from its en banc ruling in In re Bilski.  A recent example of this is Prometheus Labs v. Mayo, issued on September 16, 2009, where the patentable invention was a “pro-drug that upon administration to a patient converts to 6M-P, which are used to treat inflammatory bowel diseases (“IBD”) such as Crohn’s disease and ulcerative colitis.” The CAFC held, among other things, that patent law does protect the…

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Judge Michel Announces Resignation, Lays it On the Line (and promises more to follow)

November 25, 2009

CAFC Chief Judge Paul Michel doesn’t pull punches when he states his views on problems with the U.S. patent system and the federal courts more generally, and he didn’t pull too many when he announced his upcoming retirement from the CAFC on on November 20, 2009.  A few notable quotes from his speech: On interlocutory appeals of claim construction rulings to the CAFC: A provision in a Senate patent reform bill would allow interlocutory appeals of Markman rulings.  Predictably, Judge Michel doesn’t like the idea.  He states that interlocutory appeals would double or triple the case load on the CAFC, and the court “can’t handle it.” The median time to adjudicate a patent case before the CAFC?  One year “from filing, to the opinion going up on the Internet.”  Interlocutory appeals would double this to two years. And, interlocutory appeals are unnecessary as a practical matter, he argues.  Some interesting statistics from Judge Michel:  “About 3,000 [patent cases] are filed a year, about 2,700 settled spontaneously. Of the remaining 300, about 200 are resolved on summary judgment, almost always based on claim construction. . . . The remaining 100 go to trial. . . . there almost are never second trials. There usually aren’t even first trials.” On Upcoming Retirements from the CAFC: The CAFC has 11 active judges and five senior judges. . . .  [t]he . . . …

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Expect a "Perilous Future for Most Business Method Patents," Saith Judge Marylin Patel

April 6, 2009

Judge Marylin Hall Patel, a federal district judge in the North District of California (San Francisco/Silicon Valley) since 1980 and Chief Judge in the District from 1997 – 2004, is a well known federal judge when it comes to intellectual property matters. For example, Judge Patel decided the Grokster case at the district court level, which eventually was affirmed by the Supreme Court, and she has decided many patent cases.  When she speaks on IP matters, one would do well to listen Therefore, her March 26, 2009 decision in Cybersource v. Retail Decisions is of no small significance. In this case Judge Patel applied In re Bilski to invalidate two business method patent claims in U.S. Patent No. 6,029,154, titled “Method and system for detecting fraud in a credit card transaction over the Internet.” The CAFC’s decision in Bilski requires that a process either be tied to a machine or apparatus or involve a transformation, and Judge Patel held that the ‘154 patent failed this “machine-or-transformation” test. Judge Patel held that a credit card number is not a physical object, thereby failing the “transformation” test, and she rejected the argument that because the claims were tied to the Internet they satisfied the “machine” test, since “one cannot touch the Internet.” At the conclusion of her opinion she stated: In analyzing Bilski, one is led to ponder whether the end has…

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Andy Updegrove's Thoughts on the Microsoft v. TomTom Patent Case, on

March 20, 2009

It would be an understatement to observe that Microsoft’s patent suit against Dutch GPS vendor company TomTom has been closely watched. Why? Because Microsoft alleges that several of the patents at issue are infringed by TomTom’s implementation of the Linux kernel. In this first month of the dispute, the most urgent question has been this: will TomTom fight or fold? Now we have the answer: TomTom has decided to fight – and perhaps fight hard. Yesterday, it brought its own suit against Microsoft in a Virginia court, alleging that Microsoft is guilty of infringing several of TomTom’s own patents. The question that many Linux supporters are now asking is this: is this good news for Linux, or bad? Here are my thoughts on that important question. Continue reading ….

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"You Assert That a ‘Spike’ is a Non-Pointed Structure Under This Patent? That Will Cost You $4.6 Million, Counselor!"

March 18, 2009

As I’ve said so many times in this blog, it’s not the law you need to fear, it’s the judge. In CU Medical v. Alaris Medical System (a patent infringement case involving medical valves) the patent owner/plaintiff argued that the term “spike,” described in the patent as “a pointed instrument,” included non-pointed structures, such as a tube.The California U.S. District Court trial judge didn’t take kindly to this frivolous argument (in the eyes of the judge).  The judge also found that the plaintiff had made “multiple, repeated misrepresentations . . . to the Court,” another no-no. The trial court imposed sanctions totalling $4.4 million under 35 U.S.C. Section 285 (“The court in exceptional cases may award reasonable attorney fees to the prevailing party”) as well as Rule 11 sanctions for good measure. The CAFC affirmed. Here’s is a link to the case: CU Medical v. Alaris Medical System.

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American Lawyer: The USSC Has the CAFC Trembling in its Robes

March 17, 2009

“Justice belongs to those who claim it, but let the claimant beware lest he create new injustice by his claim and thus set the bloody pendulum of revenge into its inexorable motion” Frank Herbert ———————— For those who have access to the American Lawyer (and I realize that at $430/year that’s a tiny percentage of lawyers, and almost no non-lawyers), there’s a interesting article in the March 2009 issue on the impact the Roberts Court’s patent rulings in appeals from the CAFC (six cases, six reversals) has had on the CAFC. The article, titled “The Error of Their Ways,” shows the extent to which the USSC is pushing the CAFC in the direction of a more moderate (less permissive) application of patent law. According to this article, the Supreme Court has the CAFC questioning everything they have ever known about patent law. If this article is to be believed, the Supreme Court has effected a major retrenchment in U.S. patent law. Oh well. Who said that the law was immune from creative destruction? You may be able to find the American Lawyer in a library, but I doubt that many libraries would pay that subscription ….

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CAFC to Patent Applicant: "Read Our Lips – We Really Don't Like Business Method Patents"

March 14, 2009

In In re Lewis Ferguson, a March 6, 2009 decision from the Court of Appeals for the Federal Circuit, the applicant sought to patent “a marketing paradigm for bringing products to market.” After the application was denied by the various levels of the Patent Office bureaucracy for lack of patentable subject matter, the applicant appealed. The CAFC court quoted this claim from the application as an example: A paradigm for marketing software, comprising: a marketing company that markets software from a plurality of different independent and autonomous software companies, and carries out and pays for operations associated with marketing of software for all of said different independent and autonomous software companies, in return for a contingent share of a total income stream from marketing of the software from all of said software companies, while allowing all of said software companies to retain their autonomy. Novel and nonobvious? It may just be me, but if this isn’t a distribution system that’s been implemented a million times, I’ll be damned. The CAFC didn’t like it either, but they didn’t even get that far. Relying on In re Bilski, 545 F.3d 943 (Fed. Cir. 2008) (en banc), the Court observed: Applicants’ method claims are not tied to any particular machine or apparatus. Although Applicants argue that the method claims are tied to the use of a shared marketing force, a marketing force is…

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What? Marshall, Texas?

March 5, 2009

It would be nice if lawyers didn’t have to call their clients and tell them that their company had been sued for patent infringement in the Eastern District of Texas (EdTX). “Where? Where’s that?” “What, you’ve never heard of Marshall, Texas?” you reply. “Never been to Tyler, Beaumont or Lufkin? Kind of quiet evenings after the sidewalks are rolled up, but your choice of BBQ rib joints is almost endless, and traffic isn’t a problem.” As I’ve written before EdTX has evolved into a hotbed of patent litigation, although it has cooled a bit as of late. When you’re talking to a lawyer in Boston and you learn that he or she is heading to Texas, it’s a good bet that the destination is somewhere in the Eastern District. The EdTX has assembled some frightening statistics regarding number of patent cases (large) and the success rate of plaintiffs (high). The lawyers in that part of the country joke that they used to do PI law (personal injury), and now they do IP law (intellectual property). But, everyone has known for a while that this couldn’t last forever, and that EdTX might lose its hold on patent litigation once W left office. Indeed, the patent reform litigation just filed in the House and Senate has the EdTX in its crosshairs. The Senate bill states (excerpted): A party shall not manufacture venue by…

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Worthless Patents

February 25, 2009

Once you get a patent, it costs a lot to maintain it. For most categories of patentees, the maintenance fees after issuance are $980, $2,480 and $4,110 at 3.5 years, 7.5 and 11.5 years, respectively. If the fee is not paid, the patent is forfeited. Top patent blogger Dennis Crouch has an interesting set of statistics on his site, discussing the “fall-off” rate of maintenance fees paid at the end of each of these periods, beginning in July 1998. The non-renewal rate is significant. As Mr. Crouch observes, the non-renewals shorten the life of the median patent from 17 years to 12 years. Click here for a more detailed explanation of the study, and a scatter plot graphic. It’s no great surprise that many patents fail to survive, but it’s interesting to see just how many are abandoned because their owners don’t deem it to be worth the expense to keep them alive.

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Will Massachusetts Lose Judge Saris to the CAFC?

January 17, 2009

According to the front page of the January 12, 2009, National Law Journal (above the fold), Massachusetts U.S. District Court Judge Patti B. Saris is on the “short list” to be appointed to the Court of Appeals for the Federal Circuit – the so-called “science court” that sits in Washington D.C. and hears patent appeals from all of the U. S. District Courts in the United States. When it comes to patents, Judge Saris is the “stand out” judge in Massachusetts. She’s shown a liking and a knack for patent litigation, and lawyers who draw her in their patent cases are appreciative.   She also is active on “the circuit,” speaking at seminars and events where judges are asked to share their thoughts on patent law issues – in other words, she’s an authority on the subject, and her influence extends far beyond her court room. The NLJ has an extensive article, the main point of which is that the CAFC, which has 12 judges, is expected to lose as many as half that number to retirements in the next few years.   Not only is Judge Saris on the short list of about 10 candidates for the CAFC, but she is one of only three judicial candidates. Needless to say, it would be a blow to the Massachusetts federal bench if it lost a judge of this caliber, but it would…

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How to Attract Patent Litigation

November 27, 2008

If you’re a federal district court, that is. The answer? You need something not every federal district has. The Eastern and Southern Districts of Texas have them. The Northern District of California has them. The Districts of Pennsylvania (Western), Georgia (Northern) and Illinois (Northern) have them. In fact, so many U.S. District Courts have them that its getting difficult to keep up. Like so many things in life, at first its an advantage to have them, and eventually it becomes necessity. And now the U.S. District Court for the District of Massachusetts has them. What are they? Local procedural rules that apply only to patent cases. Local patent rules recognize that patent cases present legal, technical and discovery issues that call for specialized handling. In most jurisdictions these rules require early claim identification and invalidity defenses, attempt to schedule early claim construction (by the Court or by stipulation of the parties) and generally attempt to speed up the patent litigation process. After all, plaintiffs tend to seek out jurisdictions where they can get to trial as quickly as possible, since delay only increases expenses, while speed tends to lead to settlements. Frankly, the Massachusetts local patent rules appear on the weak end of the spectrum – they focus entirely on the initial Local Rule Rule 16.1 statement to the court, and require the parties to propose a schedule for disclosure…

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