June patent filings saw an uptick in the retail space. Frequent filers included Aeritas, Internet Media Interactive, Secure Cam, and Symbology.

As usual, I prepared the report in partnership with and using Docket Navigator and its powerful database.  Docket Navigator is a valuable resource, and the place to go if you want to keep track of new patent litigation filings or want to know what is happening in particular cases, how your judge has historically handled a particular type of motion, or a particular plaintiff’s litigation history.  Finally, please let me know if you have thoughts about the report or changes you would like to see.  I am preparing it as a service for retailers and their supply chain who may want an overview of the patent litigation landscape.  So, I am very open to your suggestions for improving the report.

Continue Reading June 2019 Retail Patent Litigation Report

My partner Anthony Fuga is providing excellent analysis on the latest Section 101 cases and issues at the Holland & Knight Section 101 Blog, which he edits and does a substantial amount of the writing for. His latest post provides valuable insight into how district courts are approaching Section 101 cases since the Federal Circuit’s Berkheimer and Aatrix decisions based upon a recent RPX study. It is reposted below, with permission and cross-posted on my Chicago IP Litigation blog:

RPX’s latest quarterly review provides a deep dive on the effects of Berkheimer and Aatrix. If you forget, the Federal Circuit found in those two 2018 cases that Section 101 motions – at the Rule 56 and Rule 12 stages, respectively – should not be granted if the plaintiff properly raised a factual dispute regarding whether the asserted patent contains an inventive concept. Now, more than a year later, we have the data to see the impact of those cases.

According to RPX’s analysis, “district courts have as a whole become less likely to grant Alice challenges: Since the Federal Circuit issued its opinion in Berkheimer, courts have invalidated at least some claims from around 46 percent of patents challenged and adjudicated under Alice, a significant drop—roughly 23 percent [down] from the pre-Berkheimer nationwide invalidation rate of 69 percent.”

RPX also provides a breakdown of those decisions by the procedural stage, looking at both motions to dismiss and motions for summary judgment. At the Rule 12 stage, “the invalidation rate for patents challenged and adjudicated under Rule 12 – where a court has invalidated at least some claims – has dropped from around 70 percent to 45 percent.”

RPX provides further analysis and helpful charts to dig deeper into the Berkheimer/Aatrix effect, along with discussing the uptick in non-practicing entity activity, a PTAB update, the patent marketplace and more.

The entire review is worth reading and can be found here.

By: Anthony J Fuga|Taite R McDonald|Michael Obeiter

The U.S. District Court for the District of Colorado on April 17, 2019, upheld United Cannabis Corp.’s (UCANN) patent claims concerning a liquid cannabinoid formulation, “wherein at least 95% of the total cannabinoids is a specified cannabinoid or combination of them.”1

Pure Hemp challenged the claims in an early motion for summary judgment, arguing that UCANN’s claims are directed to “the unpatentable natural phenomenon of the specified chemical compounds (cannabinoids, terpenes, and flavonoids), as if UCANN is trying to secure a monopoly on those compounds.”

The court walked through the relevant precedent going back to the Funk Brothers 1948 U.S. Supreme Court opinion, which invalidated a new mixture of nitrogen-fixing bacteria: “Patents cannot issue for the discovery of the phenomena of nature. The qualities of these bacteria . . . are part of the storehouse of knowledge of all men.”

The court then acknowledged the current reality: the “proper application of the Supreme Court’s Alice standard is an evolving and sometimes hazy area of law . . . not as straightforward as the Supreme Court makes it sounds in Alice itself.”

Despite the “hazy area of law,” the court found that the challenged claims are not directed at unpatentable subject matter. Instead, “the obvious thrust of the patent is a supposedly new means by which humans can consume cannabinoids so that those cannabinoids can produce the pharmacological effect they are known to have, thus (hopefully) treating or ameliorating various diseases and symptoms.”

The court found Pure Hemp’s argument unpersuasive: “Pure Hemp has failed to establish beyond genuine dispute that a liquefied version of cannabinoids and related chemicals specified in the [patent claims] is anything like a natural phenomenon . . . Pure Hemp nowhere claims that these precise concentrations, or anything close to them, occur in liquid form in nature. Accordingly UCANN’s claims are not restatements of the ‘handiwork of nature.’ ”

The court finally noted that it sees reason to question whether the patent “claims anything novel, useful, or nonobvious” but its analysis here was limited to the Section 101 Alice inquiry.

Beyond the patent claims at issue in this case, it is important to note that cannabis-derived goods also occupy a “hazy area of law,” though one that is getting clearer every day. While hemp – defined as any part of the cannabis plant or a derivative with less than 0.3 percent delta-9-tetrahydrocannabinol (THC) on a dry weight basis – was legalized in the 2018 Farm Bill, in most states these products will continue to be illegal until the U.S. Department of Agriculture (USDA) issues regulations and states subsequently have their licensing and regulatory plans approved by USDA. And while changes are coming at the U.S. Food and Drug Administration, cannabis-derived products are still not permitted in food, drugs or supplements, and companies cannot make any unfounded and unproven claims of medical benefits.

In short, this is a rapidly evolving area of law at the federal and state level that requires all existing and potential market participants to remain vigilant.

Clients seeking further information on the District Court’s ruling and its impact or the current regulatory landscape may contact the authors.

Notes

1 United Cannabis Corp. v. Pure Hemp Collective, Inc., No. 18-cv-1922-WJM-NYW (D. Colorado, April 17, 2019)

The Illinois State Bar Association (ISBA) has launched Illinois Lawyer Now a legal blog aggregator that provides ISBA news combined with aggregating blog posts from ISBA members. As someone who for years kept and updated a list of regional IP blogs, I am interested to see how ISBA’s new aggregator works. ISBA, partnering with LexBlog (who built and maintains my blogs) plans to offer the best legal content from lawyers across Illinois. It should be a great asset for anyone doing business in or living in Illinois. I look forward for great things to come from ISBA and Illinois Lawyer Now.

I am honored to announce that I will be interviewing U.S. Patent & Trademark Office Director Andrei Iancu at the kickoff session of this year’s Rocky Mountain IP Institute in Denver, Colorado. First, I invite you to join me – register here. I have attended and spoken at the Institute for years and firmly believe that it is one of the best, if not the best IP conference in the country. Second, while there is a lot that I want to ask Director Iancu, I would love to get your thoughts on what I should ask. I am not promising I will ask every question you have. But I firmly believe collaboration and diversity build better results. So, I invite your thoughts. Please reply with questions or send them to me, if you would prefer.

Sens. Chris Coons (D-Del.) and Thom Tillis (R-N.C.), along with Reps. Doug Collins (R-Ga.), Hank Johnson (D-Ga.), and Steve Stivers (R-Ohio), have unveiled a bipartisan and bicameral framework on Section 101 patent reform. The framework, released last week, is short – only one page – but the intent is clear: temper the Section 101-based rejections and invalidations that have skyrocketed since the Supreme Court’s 2014 Alice decision.

For instance, the framework would define an exclusive set of categories of statutory subject matter that alone should not be eligible for patent protection, and “statutorily abrogate judicially created exceptions to patent eligible subject matter.” The framework would also “create a ‘practical application’ test to ensure that the statutorily ineligible subject matter is construed narrowly.”

Sen. Coons emphasized the framework’s intent, saying in a press release: “Today, U.S. patent law discourages innovation in some of the most critical areas of technology, including artificial intelligence, medical diagnostics, and personalized medicine … I look forward to continuing to receive feedback as we craft a legislative solution that encourages innovation.”

Rep. Stivers echoed that sentiment: “We have the opportunity to advance our society in so many exciting and unknown ways, and we need to ensure we have a patent system that encourages that kind of game-changing innovation, instead of stifling it.”[1]

Conclusion and Next Steps

Big tech, pharmaceutical companies, trial lawyers and intellectual property owners will surely be paying attention to the framework’s progress, but it is unclear how quickly it will move forward – or whether it will move at all. The next step for the legislation would be to turn the current framework into full legislative text. Once the legislation is formally introduced, it would have to survive markups in both the House and Senate Judiciary Committees as well as votes by the full House and Senate.

Reforms to patent eligibility will garner significant interest, and its ultimate enactment will require its sponsors to make its enactment a priority before the politics surrounding the 2020 presidential election take over next year. This particular proposal has the benefit of bipartisan support from leaders on the House and Senate Judiciary Committee that give it real potential for enactment. Interested stakeholders are encouraged to engage with Congress as early as possible to let their voices be heard.

Notes

[1]  The statements by Sen. Coons and Rep. Stivers, as well as the framework’s language, are in this press release: “Sens. Coons and Tillis and Reps. Collins, Johnson, and Stivers Release Section 101 Patent Reform Framework,” April 17, 2019.

 

In light of new case law and an uptick in patent filings, and in particular cease & desist letters, I am presenting a Strafford live webinar titled, “Patent Infringement Letters: New Considerations and Best Practices for Senders and Recipients.” The program is being held on Thursday, May 16, from 12:00pm-1:30pm CT. If you follow the link in the prior sentence to register, you will receive a 50% discount on the program as a loyal blog reader.

My co-panelist is Nathan Burnette of Stoel Rives. We will discuss patent demand / licensing letters from both sides, providing strategies both for preparing them and responding to them, or not responding depending upon the circumstances. The presentation will conclude with a live Q&A session to make sure we address your particular issues.

If you have questions ahead of the program or thoughts on what should be addressed, please contact me via the blog or email.