The Supreme Court Delivers Opinion in TC Heartland LLC v. Kraft Foods Group Brands LLC

In an 8-0 opinion regarding the case TC Heartland LLC v. Kraft Foods Group Brands LLC, on May 22, 2017 Justice Thomas delivered the opinion of the Supreme Court. The judgment was reversed and the case was remanded. All members joined, except Justice Gorsuch, who took no part in the decision of this case. The Supreme Court issued this highly-anticipated decision and reversed the Federal Circuit. The Supreme Court ruled that 28 U.S.C. 1400(b) remains the only applicable patent venue statute. Secondly, that 28 U.S.C. 1391(c) did not modify or amend 1400(b) or the Court’s 1957 ruling in Fourco Glass Co. V. Transmirra Products Corp. The Supreme Court also ruled that the term “residence” in 28 U.S.C. 1400(b) means only the state in which a company is incorporated.

Patent owners will no longer be able to sue an infringing defendant in a district court where the defendant is subject to personal jurisdiction. Patent infringement lawsuits will only be able to be filed in districts within states where the infringing defendant is incorporated. As well as in districts where there has been an act of infringement and the defendant has an established place of business.

The Supreme Court also determined In TC Heartland, that Congress did not intend to change the meaning of 1400(b), or to overrule the decision in Fourco Glass. The Supreme Court relied and referred to the 2011 changes that added “otherwise provided by law” as some evidence that Congress must have wanted 1400(b) to apply.

Foreign corporations and other types of domestic entities can still presumably be sued mostly anywhere. The Supreme Court’s decision did not directly address this, but it was clearly stated in footnotes 1 and 2. While this decision is not favorable to patent owners, patent venue has been the target of patent reform debates in Congress for many years. This ruling is expected to increase cost, complexity and continue to create uncertainty for small entities.

A Karaoke Publisher’s _“Trademark”_ Claim Dismissed By Texas Judge destroyed

A karaoke music publisher brought a suit against several Houston bars that played its karaoke tracks without permission, but a Texas federal judge tossed part of the trademark suit. The infringement suit of Phoenix Entertainment Partners LLC’s is one of several hundred the company has filed around the country over its Sound Choice brand of karaoke tracks. The court admonished Phoenix’s repeated attempts to argue that the unauthorized copying and performance of its karaoke files constitutes a form of trademark infringement. U.S. District Judge Lee H. Rosenthal ruled, that this argument could not stand because allegation should properly be styled as a copyright claim, a differentiation that several appellate courts recently established in “well-reasoned opinions.” “Phoenix alleged that the defendants infringe its goods marks when they illicitly download and play Sound Choice-branded karaoke tracks,” the judge noted. “That is trademark lipstick on a copyright pig.”

The Texas Judge ruled claims as to the company’s “goods” trademark for the songs themselves are dismissed. However the karaoke music publisher may still proceed with claims that the Houston bars infringed its service marks by displaying Sound Choice name and logo during the performance of the tracks at their establishments. The ruling of Judge Rosenthal comes three month after the Ninth Circuit shot down a similar suit filed by Step-Tone (now Phoenix) against an Arizona karaoke provider. Phoenix’s primary argument is that the accused offenders played those tracks for their patrons without paying for a license and that the accused offenders have ripped the popular Sound Choice lyric-accompanied tracks to their own digital hard drives. Phoenix selected to go with a trademark infringement, instead of suing for copyright infringement under the theory that the consumers are misled into thinking they are getting a song off a Step-stone/Phoenix CD when in actual fact they are really getting it from a karaoke bar’s hard drive, the publisher contends.

But the argument of the publisher hasn’t held up well in the appellate courts. The Seventh Circuit similarly held last July that the company couldn’t sue under the Lanham Act, because the claims dealt with intangible expressive content, not actual market goods that might confuse consumers Both the Seventh and Ninth Circuit decisions heavily cited the U.S. Supreme Court’s 2003 Dastar v. Fox ruling, which provides clear limits between the source-designating scope of trademark law and the expression-protecting scope copyright law. Every one of those decisions came into play by the Texas court decision. Consumers cannot possibly be confused by the Sound Choice goods marks, Judge Rosenthal said, because bar patrons don’t actually see the digital files, only the performance of the digital files, which, for all they know, may have been derived from any number of sources, be it a hard drive or internet streaming source, she said. Indeed virtually identical attempts to assert a trademark-infringement claim based on the goods marks, the Supreme Court and two appellate courts has these firmly rebuffed. However on Phoenix’s trademark claims regarding the display of the Sound Choice name and logo during the performance of the karaoke songs, the judge eased up. “Unauthorized use of Sound Choice’s service marks in karaoke shows could plausibly confuse the bar patrons by unfairly trading on Sound Choice Entertainment’s brand identity and impairing Sound Choice Entertainment’s ability to differentiate its services from the competition,” she wrote, allowing those claims to move forward.

On Parking Meter Patent The Patent Trial And Appeal Board Arrives At An ‘Unusual’ Decision

In a decision the Patent Trial and Appeal Board acknowledged was ‘unusual’ the PTAB upheld several claims of an IPS Group Inc. electronic parking meter patent while at the same time invalidated a couple of the patent’s other claims. The final decision in inter parts review found that petitioner Duncan Parking Technologies had shown that two of the patent’s claims were anticipated by an earlier IPS Group patent, while seven other claims had not been shown to be invalid. A mixed conclusion it not unusual for the board, when a number of claims in a patent are challenged.

But the parts of the patent that was held to be invalid, compared to the parts that were not made for a strange situation. Some of the claims upheld by the board are what are known as independent claims, broader claims that are able to stand alone. The two claims held to be invalid however, are known as dependent claims, which depend upon another claim and are therefore a more narrow claim. “We are cognized that, at first glance, it is logically difficult to reconcile a simultaneous determination that while an independent claim is patentable, a claim dependent therefrom is not, “the board wrote. “Nevertheless, after reviewing the relevant facts and law, we determine that this outcome, while admittedly unusual, is correct for the reasons set forth herein.” wrote the PTAB

Duncan’s invalidity position at trial were based entirely on an earlier IPS Group patent, which Duncan argued described the exact same parking meter. The key question, was whether the earlier patent could be considered prior art. There are several Inventors on both IP Group patents, but David King, who is the founder and CEO of the San Diego-based company is named as an inventor on both patents. The IPS Group argued that David King’s own invention could not be used against him. However, Duncan countered, in part, that another man helped conceive of aspects in the earlier patent – U.S. Patent No. 8,595,054 – that anticipated much of the newer one. The more recent patent is U.S. Patent No. 7,854,310. The [King’054] anticipatory disclosure is ‘by another’… and thus invalidates claims 1-5 and 7-10 of the ‘310 patent,” said the PTAB. As to all seven of the challenged claims however, the board was not convinced. The PTAB found little reason to disbelieves that Mr. King was the sole inventor of the applied portions of King ‘054 patent on which Duncan are relied on to argue that claims 1 – 5, 7, and 9 of the ‘310 patent were allegedly anticipated. However, the PTAB found that the parking meter patent’s two invalidated claims relate to aspects of the face of the parking meter. With respect to those claims, the PTAB said it had a “clearer picture” of who was responsible for the invention. And it was “unquestionably different than the inventive entity of all portions” of the earlier patent, the board said. “In that respect, King’ 054 is clearly ‘by another’ when it comes to claims 8 and 10, the board wrote. “As such after considering the record at hand, we are persuaded by DPT that claims 8 and 10 are considered appropriately as unpatentable. Our locksmiths have years of hands-on technical training and a vehicle full of all the equipment that’s necessary to deliver fast and precise car key duplication and replacement car keys services to you, no matter where your vehicle is located.

‘Big Bang Theory’ Wins Lawsuit Against ‘Warm Kitty’ Lyrics

A federal court in New York ruled, that the daughters of a writer whose nursery-rhyme appeared in the TV sitcom “The Big Bang Theory” won’t be able to bring copyright infringement claims against the show over its use of the ditty “Warm Kitty”. The court held that Ellen Newlin Chase and Margaret Chase Perry can’t prove their late mother held the copyright to the song, which TV character Sheldon taught a friend to sing when he was ill in an episode of the sitcom.

In December 2015 Chase and Perry brought an action against Warner Bros. Entertainment Inc., CBS Corp., Fox Television Stations Inc. and other associated companies, alleging “the show used their mother’s work without proper permission”. Edith Newlin, a nursery school teacher and writer, had penned “Warm Kitty” for a 1930 s song book that was covered by a blanket copyright notice, according to the opinion. The defendants used the lyrics in a little modified form, including on the television show ‘The Big Bang Theory’, the opinion said.

The court held it is governed by the Copyright Act of 1909, because of of the song’s publication date. And under the Copyright Act of 1909, authors were granted an initial 28-year copyright term, and if the owner dis not renew the term, the work become public domain. There is not any evidence that Newlin did renewed the owner term. After the 28-year copyright term the work went in into the public domain. Still, the opinion said, the owner of the songbook, “Songs for the nursery School”, had renewed the copyright for the book in 1964.However, Copyright Law “granted the owner the right to renew composite elements and the individual author the right to renew his contributions,” said the opinion. Meaning the holder of a collective work could only renew the rights to the contributed parts he or she had collected from the individual contributors, said the court. And the court found that Chase and Perry couldn’t prove that Newlin had assigned the song rights to the book owner and that it was covered by the copyright renewal. Furthermore they could not prove they had a valid claim to the work, according to the opinion. The court shot down the arguments that Newlin had assigned the songbook a “common law copyright” while retaining a personal “copyright” and “other rights”

In Unified Patent Court The United Kingdom Has A Uncertain Post-Brexit Role

 

As the process to leaving the European Union starts for the United Kingdom, attorneys expect Britain to be part of the EU’s new Unified Patent Court, while the separation is finalized. However, questions linger regarding whether the United Kingdom can participate in the court after leaving the EU. The British Prime Minister’s signaling of its intention to leave the EU officially begins two years of negotiations over the terms of the departure, which will include the U.K.’s role in the patent court. In November the British government said, it still plans to ratify the agreement establishing the long-planned Unified Patent Court, the court should adjudicate about patent disputes across the EU in the future. Attorneys expect the British Parliament will approve ratification in the coming weeks.

The United Kingdom will still be a member of the EU and will participate in the court, when the agreement is ratified and the court gets up and running as planned later this year. The U.K. might be able to remain a part of the court once it is no longer part of the EU but attorneys say both political and legal considerations make that far from certain. Under these premises the issues that will remain unresolved include whether British politicians will accept being part of a court made up of EU members that makes decisions outside the U.K., whether the other countries will want a non-EU country to participate in the court, and whether it will be even legally permissible for the U.K. to be involved.

Right now, Patent owners can get either a national patent that the offers protection in only one country, or a European patent, which is essentially a bundle of national patents that must be enforced with individual litigation in each country. After ratification, the EU unitary patent will offer protections in more than 25 EU countries and infringement disputes regarding a EU unitary patent can be adjudicated at the Unified Patent Court, in one case and the system was expected to take effect last year, but the Brexit election outcome slowed the process. The agreement establishing the Unified Patent Court requires ratification by 13 EU members, including the U.K. although it had been unclear if the UK would ratify the agreement after its Brexit vote. But the government of the U.K. said last year that it would do so and would “play a full and active role” for as long as it is part of the EU. John Pegram of Fish & Richardson PC’s New York office said” There have been no indications that Parliament won’t ratify the agreement. Once the U.K. does ratify the next step will be for Germany the final required country to ratify the agreement. After the approval would be begin the process for the UPC to begin operations in December.

Complicating matters are issues such as the Brexit proponents argument that the U.K. should not be subject to rulings by European courts like Luxemburg-based Court of Justices of the European Union, which will have a role in reviewing some aspects of the UPC’s. In other words, the U.K.’s continued participation after it departs the EU will be subject to negotiation over the next two years. Especially what the U.K.’s role would be in a European court with judges from countries all over the continent making decision’s on patent matters in the U.K. An agreement to give the British the possibility the participation in the UPC could be reached between the U.K. and the EU. However, the current agreement would require a modification, as it currently refers to all the participants as EU members states.

Questions remain on whether UPC participation could be used as a bargaining chip by the EU during Brexit negotiations, and whether British politicians who promised to end the CJEU’s, jurisdiction over the U.K. will be on board with a patent system where decisions can still be reviewed by that court, although only on narrow issues.

However even if a deal could be made for Britain to be part of the UPC post-Brexit, the CJEU could still potentially pose a legal hurdle to the U.K.’s participation. The court could rule that only EU members can be participate in the court, as it held in an earlier case over the formation of the court.

The Unified Patent Court will hear disputes over traditional European patents as well as the new unitary patent, but there is also a question of whether unitary patents would be enforceable in the U.K. post-Brexit. Still, despite all the potential complications for patents that could arise once the U.K. leaves the EU, attorneys said it appears that the Brexit vote has not derailed the new system and that it should be able to roll out in the coming months.

The Judge Reconsiders Alice Order, Saves Part Of Security Patents

In a previous order by a federal judge invalidated all of the claims of two security system patents for claiming abstract ideas. However in a following decision, judge concluded that she only had jurisdiction to rule on the claims asserted by plaintiff Joao Control & Monitoring Systems.

Judge Rebecca R. Pallmeyer of the Northern District of Illinois granted some parts of Joao Control & Monitoring Systems LLC’s motion to reconsider her March ruling in a suit against Telular Corporation where Judge Pallmeyer found all 200 claims of the patents were invalid under the Supreme Court’s Alice decision. She held under the revised order that she could only rule that the 12 claims Joao asserted were invalid. The infringement allegations were by Joao narrowed to cover those 12 claims under the district’s local patent rules. The Judge held that the company “effectively withdrew the portion of its complaint addressing the unasserted claims.”

Joao alleged in its complaint that Telular infringed two patents on security systems that monitor vehicles and buildings through a network connected to the internet, asserted Joao in the filed suit from 2014. Telular infringed one or more claims of the patent, one of which has 112 claims, the other of which has 88 claims, the complaint initially alleged. The numbers of asserted claims was later to 12.

Previously, the judge granted Telular’s motion for judgement on the pleadings. There the judge ruled that the judge patents cover only the abstract idea of monitoring and controlling property using generic computer functions like the internet. “Law enforcement officials have used several forms of electronic video and audio recording devices to monitor potential criminal activity on or around property since the mid-20 th century,” she noted. In the judge’s subsequent decision on reconsideration the judge rejected Joao’s argument that the invalidity findings should be limited to only the single claim. The other claims a very similar and “it benefits no one to have the court simply repeat its analysis 12 times,” the judge noted.

American Bar Association Proposal To Change Patent-Eligibility Law

Proposed legislation to clarify what is and is not patent-eligible has been advanced by the American Bar Association Section of Intellectual Property Law. This is now the second major IP group sent to the U.S. Patent and Trademark Office Director Michelle Lee such a proposal. The proposal includes revisions to Section 101 of the Patent Act. The Patent Act Section 101, includes provisions regarding eligibility. The proposed revisions emphasize that claims should be patent-eligible so long as they not preempt the use by others of laws of nature, natural phenomena, or abstract ideas. The proposed revisions also recite that in determining whether an invention is patent-eligible, the issues like novelty and obviousness should not be considered.

The Group said it believes its proposal “is an important first step toward a politically palatable solution to the unworkable and detrimental state of current 101 jurisprudence.”

Another group, the intellectual Property Owners Association released a different proposed legislation earlier this year. The USPTO has received comments from several industry groups for a legislative revision of Section 101.

Many are concerned that the, high-profile Supreme court decisions on patent eligibility, including Prometheus and Alice have made it unclear what is eligible for a patent. The ABA and IPO suggest the best way to solve the issue is for Congress to revise the patent eligibility statue.

The ABA argues that the high court’s rulings “have injected ambiguity into the eligibility determination” by requiring courts and the USPTO to determine if the claimed invention is “well-known” or “routine”, issues the ABA says should only be relevant when determining if an invention is anticipated or obvious.

The ABA further maintains that in the past, the main concern from the Supreme Court’s, in its patent-eligibility decisions has been avoiding patent that “preempt” others from using basic building blocks like abstract ideas. The ABA said that cases such as Alice has “led the lower courts to lose sight of the fundamental preemption concern that has driven patent eligibility jurisprudence”.

The ABA stated that an example of that was, the Federal Circuit’s 2015 Sequenom decision in which the court found that Sequenom Inc.’s fetal DNA test is not patent-eligible, because it is directed to a natural phenomenon, despite the fact that the court also said it was a groundbreaking innovation that did not preempt the use of a scientific discovery.

The ABA argues that is proposed legislation “directly applies the long-standing fundamental concern of Supreme Court precedent” and “at least substantially mitigates if not resolves newly injected ambiguity and confusion into the eligibility determination” by the use of factors relevant only to anticipation and obviousness.

The proposal specifies conditions under which inventions would not be patent-eligible. And under this section patent eligibility will not be negated when a practical application of a law of nature, natural phenomenon or abstract idea is the subject matter of the claims upon consideration of those claims as a whole, whereby each and every limitation of the claims shall be fully considered and none ignored.

The proposal further states that patent eligibility shall not be negated based on considerations of patentability like novelty and obviousness.

The released proposed legislation from IPO’s in January is similar to the ABA’s in some ways. Where the ABA’s proposal focuses on prohibiting patents that preempt the use of natural phenomena and abstract ideas, the IPO’s seeks to define what types of inventions are not patent-eligible.

 

Justice returns patent Laches to Federal Circuit

In March the U.S. Supreme Court remanded to the Federal Circuits multiple appeals, including ones over Johnson & Johnson stent patents and Fossil watch parts, in light of the recent Supreme Court decision last week that laches is not a defense for many patent infringement cases.

In three cases the Supreme Court vacated the Federal Circuit judgements and directed the lower appellate court to reconsider the matters given the justices’ 7-1 judgements in SCA Hygiene Products AB et al. v. First Quality Baby Products LLC et al, that barred laches in many patent cases.

IN SCA Hygiene the Court ruled that, because the Patent Act only allows recovery of damages for infringement that transpired less than six year before the complaint was filed, laches cannot be a defense against damages where the infringement occurred within the period allowed by the statute.

In a copyright opinion from 2014 the Supreme Court in Petrella v. Metro-Goldwyn-Meyer Inc. decided, that because the Copyright Act sets a three-year statute of limitations during which claims must be bought, laches cannot be used to bar claims filed within that period. The high court had held that since the Copyright Act sets a three-year statute of limitations during which claims must be bought. A Patent Act of 1952 includes a similar, provision setting a six-year limit on past damages. And in SCA Hygiene, the high court held that the Petrella holding applies to patent law.

In the three cases the U.S. Supreme Court sent back to the Federal Circuit one involved Medinol Ltd. who in March 2013 sued Johnson & Johnson and its affiliate, Cordis Corp. alleging that two coronary stents sold by Cordis infringed four of its patents covering coronary stents that are used in balloon angioplasty procedures.

In another case, Acacia Research Corp. subsidiary Endotach LLC sued Cook Medical LLC in June 2012, alleging that Cook’s products violated two patents covering stent grafts used in the treatment of damaged heart arteries.

And in the last case, Romag Fasteners Inc. sued Fossil Inc. in 2010, claiming Fossil violated its trademarks and patents by using fake Romag magnetic snap fasteners on wallets and watches.

In all three cases the defendants invoked laches as a defense and the defendants were successful.

The Supreme Court did not address a second question posed by Romag in its August petition for certiorari, regarding whether, a trademark owner can be awarded an infringer’s profits in the situation where the defendant has not willfully infringed.
A federal jury found Fossil liable for both trademark and patent infringement in year 2014 after a seven-day trial. Though the jurors determined that Fossil had acted with “callous disregard” of Romag’s intellectual property rights, the jury did not find that the infringement was willful. Thereafter the judge refused to award the company Fossil’s profits. Last March the Federal Circuit affirmed the decision. The Federal Circuit had jurisdiction because of the patent issues but applied Second circuit trademark law.

The Trademark Beef over ‘Landmark’ has been settled between NYC celebrated Chefs

New York, 03.23.2017 The Owner Marc Murphy of Manhatten restaurant Landmarc, has attained resolution to a trademark lawsuit over plans for an eatery named “Landmark” at the nearby site of the old Four Seasons restaurant.

The lawsuit, which was filed less than a month ago, claimed that the planned name for the new restaurant by chefs Mario Carbone and Rich Torrisi and their Major Food Group LLC, was confusingly similar to that of Murphy’s restaurant, just one mile away.

The new restaurant was to open this month in the same in the location that was occupied by the four Seasons for more than six decades. The four Season left that spot last year and have plans to reopen on Park Avenue in the future.

The first use of the name ‘Landmarc’ by Marc Murphy, was in 2004 when he opened the first Landmarc restaurant in Tribeca. His second location in midtown’s Time Warner Center it’s only a stone’s throw then planned Landmark. The Major Food Group LLC runs other Manhattan restaurants on the same upscale level.

In the lawsuit filed on March 7th, Murphy claims consumer confusing between the names “Landmark” and “Landmarc”.

“When pronounced, the words “Landmark” and “Landmarc” are phonetically identical,” Murphy wrote. “It is a generally accepted practice in the restaurant industry, that, when reservations are made for high-quality dining, they are often using a telephone, wherein the name of the restaurant spoken by an employee answering the phone and/or the patron seeking the reservation.”

This case over the previous Four Seasons site was the latest in a rash of trademark lawsuits over the New York City landmarks. The operator of the century-old venue Webster Hall sued its landlord over the rights to that name earlier this month and the city sued last month over Central Park fixture Tavern on the Green.

Murphy, suing through his Anvil NY LLC. Is represented by Ernest Edward Badway of Fox Rothschild LLP.

 

Major Food Group is represented by Andrew Bennett Kratenstein of Mc Dermott Will & Emry LLP.

USPTO Seeks Ideas For Speeding Up Patent Applications

The United States Patent and Trademark Office (USPTO) is 
continuing its efforts to expedite and improve the overall patent 
process. Accordingly, the USPTO is exploring how to best utilize 
available electronic resources to provide examiners with information 
(e.g., prior art, search reports, etc.) from applicant's other 
applications as early as possible to increase patent examination 
quality and efficiency. These other applications, for example, could 
have the same or substantially the same disclosure (e.g., domestic 
parent and counterpart foreign applications) as the U.S. application 
being examined. In addition to improving patent examination quality and 
efficiency, providing the examiner with this information from 
applicant's other applications will reduce applicant's burden to 
provide this information to the USPTO.
    Further, the USPTO is seeking to reduce the issuance time of a 
patent by eliminating potentially unnecessary information from the 
front page of the patent. In particular, the USPTO is seeking public 
comment on what information, beyond a copy of the specification and 
drawing that is required by statute, should be part of the patent 
considering that complete information concerning U.S. patents and U.S. 
patent application publications are accessible to the public via the 
Patent Application Information Retrieval (PAIR) system.
    To assist the USPTO in determining the best way to address these 
two topics, the USPTO is hosting a roundtable event to obtain public 
input. The roundtable will be open for any member of the public and 
will provide a forum for a discussion of the questions identified in 
this notice. Written comments in response to these questions set forth 
in this Notice also are requested.