Fitch Even News Feed Feb 2020 00:00:00 -0800firmwise Alert: Settlement Agreement Held to Moot Pending Case-Dispositive Motions<p>On February 13, in <i><a href="">Serta Simmons Bedding, LLC, Dreamwell, Ltd. v. Casper Sleep Inc.</a></i>, the Federal Circuit held that a settlement agreement rendered the case moot, including case-dispositive summary judgment motions, even where the settlement agreement required future performance by the parties.</p> <p>In September 2017, Serta Simmons filed suit against Casper alleging infringement of three patents directed toward customizing mattress support. Casper filed three motions for summary judgment of non-infringement. On June 18, 2018, while Casper&rsquo;s motions were pending, the parties entered into a settlement agreement. Per that agreement, Casper had the following obligations: </p> <ul> <li>Pay $300,000 by June 28, 2018</li> <li>Cease manufacturing the accused products by July 15, 2018</li> <li>Cease selling inventory</li> <li>Substantially discontinue marketing and advertising of the accused products by August 15, 2018</li> </ul> <p>The settlement agreement further required that the parties file the appropriate papers to dismiss all claims and counterclaims within five days of Casper&rsquo;s payment. In addition, the parties filed a joint motion of settlement and motion to stay.</p> <p>Notwithstanding the settlement agreement, the court issued an order granting Casper&rsquo;s summary judgment motions of non-infringement. Casper then told Serta it would not abide by the settlement agreement.</p> <p>Serta filed a motion to enforce the settlement agreement and vacate the summary judgment order, which the district court denied. The court reasoned that the case was not moot when it issued the summary judgment order because the parties had outstanding obligations under the settlement agreement. Further, the district court held that it lacked jurisdiction to enforce the settlement agreement.</p> <p>On appeal, the Federal Circuit recalled a previous case where the parties had signed an &ldquo;Agreement in Principle Term Sheet.&rdquo; This &ldquo;term sheet&rdquo; had included a dismissal agreement and an agreement to execute a license agreement. In that case, the district court had granted the defendant&rsquo;s summary judgment motion, but the Federal Circuit decided the district court should have determined whether the parties entered into an enforceable agreement because, if so, the entry of final judgment would have been rendered moot. Based on the same reasoning, the court here found that there was an enforceable agreement and that therefore the case was moot. The fact that the agreement terms required future performance was of no consequence. Thus, the court concluded that &ldquo;a binding settlement agreement generally moots the action even if the agreement requires future performance.&rdquo; &nbsp;</p> <p>The court observed that there might be situations where a district court has discretion to refuse to enforce a settlement agreement or where refusal to enforce is mandated, such as where settlement agreements are contrary to law or public policy, but such was not the case here.&nbsp;</p> <p>Additionally, the Federal Circuit held that a district court has jurisdiction to enforce a settlement agreement if a motion to enforce is filed before the case is dismissed and the proceedings are ongoing. The court reasoned that the law&ldquo;did not hold that a federal court cannot grant a motion to enforce filed before a dismissal of the case.&rdquo; &nbsp;&nbsp;&nbsp;</p> <p>This decision highlights the importance of understanding procedural implications of a settlement agreement and that such an agreement will generally render an action moot. Additionally, parties seeking to settle an action should file a motion to enforce as soon as possible after settlement is reached if the client wishes to moot any pending case-dispositive motions.&nbsp;</p> <p>For more information on this case, please contact Fitch Even attorney <a href=";A=18118&amp;format=xml&amp;p=5482">Vincent R. Meyer</a>, author of this alert.</p> <p>&nbsp;</p> <p><b>Fitch Even IP Alert<sup>&reg; </sup>&nbsp;</b></p>IP Alerts19 Feb 2020 00:00:00 -0800 Alert: Federal Circuit Holds IPR Time-Bar Challenges Are Waivable<p>On February 13, in <a href=""><i>Acoustic Technology, Inc. v. Itron Networked Solutions, Inc.</i></a>, the Federal Circuit held that the patent owner had waived arguments that the petitioners were time-barred in an <i>inter partes </i>review (IPR) because the patent owner failed to raise the arguments before the Patent Trial and Appeal Board (PTAB). In short, the court held that time-bar challenges under 35 U.S.C. &sect; 315(b) are not immune to waiver in IPR proceedings, contrary to prior cases that had described the time-bar as &ldquo;jurisdictional.&rdquo;</p> <p>In 2016, Acoustic Technology filed a lawsuit against Silver Spring Networks for infringement of two of its patents. In response, Silver Spring filed a petition for an IPR of Acoustic&rsquo;s asserted patents. On September 8, 2017, the PTAB instituted an IPR on Silver Spring&rsquo;s petition. Nine days later, Silver Spring agreed to merge with Itron, Inc.</p> <p>Acoustic had sued Itron for infringement of the same patents six years prior to this lawsuit. Thus, Itron was undisputedly time-barred from filing a petition for an IPR. Silver Spring and Itron completed the merger while the IPR remained underway. Acoustic learned of the merger three days after it was completed, and Silver Spring filed proper notices alerting the PTAB and Acoustic that Itron had become a real party in interest in the proceeding. Seven months after the merger was completed, the PTAB issued a final written decision. Acoustic never raised a time-bar challenge to the PTAB during this time.</p> <p>On appeal, Acoustic argued that the PTAB&rsquo;s final written decision should be vacated because the underlying IPR proceeding was time-barred under 35 U.S.C. &sect; 315(b). Acoustic asserted that Itron was a real party in interest. Under section 315(b), &ldquo;[a]n inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.&rdquo; Under current precedent, the PTAB must evaluate section 315(b) time-bar issues at the time it decides whether to institute the proceeding. The real-party-in-interest determination must consider all relationships that arise after the petition filing date.</p> <p>Acoustic asserted that Itron was a real party in interest <i>before</i> institution because merger discussions had already occurred and contended Itron was a real party in interest <i>after</i> institution because Silver Spring formally became a subsidiary of Itron. Acoustic argued that the PTAB must reassess section 315(b) issues after institution because otherwise parties would delay corporate deals until after institution to avoid time-bar consequences.</p> <p>In response, Itron argued that Acoustic had waived its time-bar challenge of the IPR because Acoustic did not raise these arguments before the PTAB. Itron further argued that the time-bar of section 315(b) did not apply to the underlying IPR proceeding because Itron had merged with Silver Spring after the PTAB instituted the proceeding. Itron also asserted that the PTAB is not authorized to reevaluate section 315(b) after institution under the statute.</p> <p>The Federal Circuit held that Acoustic had waived its time-bar challenge to the IPR because it failed to present these arguments before the PTAB. The court noted that Acoustic had not provided any reason for its failure to challenge the proceeding as time-barred before the PTAB and therefore exercised its discretion to find the arguments waived.</p> <p>The court further held that time-bar challenges under section 315(b) are not immune from waiver. The court reasoned that allowing Acoustic to raise a time-bar challenge for the first time on appeal would afford the patent owner a significant and unfair advantage. Specifically, by waiting for the PTAB&rsquo;s decision on the merits, patent owners could reap the benefit of estoppel arising from a favorable decision, while saving a challenge to the PTAB&rsquo;s jurisdiction for appeal in the event of an unfavorable decision.</p> <p>Because the court found that Acoustic had waived its time-bar challenge, the Federal Circuit did not reach the issues of whether pre-merger activities rendered it a real party in interest or whether the PTAB has any authority to reevaluate section 315(b) after an institution decision.</p> <p>This decision is significant for parties who are or may be involved in an IPR proceeding, because unasserted time-bar arguments may be waived. Patent owners should be vigilant for any material changes in the real parties in interest and strive to raise any resulting time-bar challenges before the PTAB. Notably, however, the Federal Circuit did not hold that <i>all</i> time-bar challenges not raised before the PTAB are waived. The court pointedly mentioned that it had not addressed the merits of this case. Concealed involvement in an IPR by an interested time-barred party may justify raising a time-bar challenge for the first time on appeal. Fitch Even attorneys will continue to monitor developments related to this case.</p> <p>For more information on this ruling, please contact Fitch Even partner <a href=";A=2585&amp;format=xml&amp;p=5482">David A. Gosse</a> or attorney <a href=";A=19279&amp;format=xml&amp;p=5482">Zachary Van Engen</a>, authors of this alert.<br /> <b><br /> Fitch Even IP Alert<sup>&reg;</sup></b></p>IP Alerts18 Feb 2020 00:00:00 -0800 Alert: Post-Decision Certificate of Correction Held Inapplicable in IPR Proceeding<p>On remand from the Federal Circuit, the Patent Trial and Appeal Board (PTAB) delivered an order in <i>Emerson Electric v. SIPCO</i> holding that a certificate of correction under 35 U.S.C. &sect; 255 issuing <i>after</i> the PTAB&rsquo;s Final Decision and <i>after</i> the patentee&rsquo;s initial notice of appeal to the Federal Circuit did not apply retroactively. The PTAB held that the certificate of correction had no impact on the final decision in the <i>inter partes</i> review because it was not in effect during the proceeding.</p> <p>SIPCO prosecuted U.S. Patent No. 8,754,780. Through an apparent error, SIPCO did not claim the benefit of an earlier patent application.</p> <p>On April 29, 2016, Emerson filed a petition for <i>inter partes</i> review (IPR) of the &rsquo;780 patent on several grounds. As to the first ground, Emerson argued, &ldquo;Because [the &rsquo;780 patent] had no co-pendency with any of its parents, the &rsquo;780 Patent is not entitled to any effective filing date prior to its actual filing date on April 2, 2013.&rdquo; Therefore, Emerson asserted the &rsquo;780 patent claims 1&ndash;15 were invalid over a reference having a prior art date before April 2, 2013.</p> <p>Within a month, on May 26, 2016, SIPCO filed an <i>ex parte</i> petition to accept an unintentionally delayed priority claim with a request for a certificate of correction under section 255 to correct the domestic priority for the &rsquo;780 patent by changing an incorrect application to the correct application. If successful, SIPCO&rsquo;s &rsquo;780 patent would have an earlier effective filing date to antedate the cited reference.</p> <p>However, SIPCO did not adhere to PTAB rules of practice. SIPCO did not file a motion with the PTAB for leave to file the first request a certificate of correction, and did not inform Emerson&rsquo;s IPR counsel of its request. Emerson learned of the effort to obtain a certificate of correction by checking the USPTO database, then brought the filing to the PTAB&rsquo;s attention.</p> <p>The PTAB issued an order staying SIPCO&rsquo;s effort pending the PTAB&rsquo;s decision on whether to institute an IPR. Subsequently, after instituting the IPR, the PTAB lifted the stay.</p> <p>Thereafter, the USPTO denied SIPCO&rsquo;s first request for a certificate of correction for being noncompliant with USPTO rules governing requests for certificate of correction.</p> <p>SIPCO sought and was given leave for a second request for a certificate of correction filed December 23, 2016, but this request was dismissed on January 19, 2017, again for being noncompliant with applicable USPTO rules.</p> <p>SIPCO filed a motion for leave to file a third request for a certificate of correction. The PTAB denied the motion. On October 25, 2017, the PTAB issued its final decision and permitted SIPCO to file its third request for a certificate of correction. In the final decision, the PTAB invalidated some claims of the &rsquo;780 patent over the reference that SIPCO sought to antedate.</p> <p>SIPCO subsequently filed its third request and petition for a certificate of correction on December 7, 2017, and filed an appeal with the Federal Circuit two weeks later.</p> <p>On January 16, 2018, the USPTO Petitions Branch dismissed SIPCO&rsquo;s third request, yet again for being noncompliant with USPTO rules governing requests for certificate of correction.</p> <p>On January 30, 2018, SIPCO filed a fourth request and petition for a certificate of correction to correct the lineage for the &rsquo;780 patent. Nine days later, the USPTO granted SIPCO&rsquo;s fourth request and issued the corrected filing receipt with the modified lineage for this patent. According to the PTAB, the USPTO issued the certificate of correction with the corrected domestic priority for the &rsquo;780 patent on March 27, 2018.</p> <p>On May 8, 2018, SIPCO filed a motion with the Federal Circuit for a remand to the PTAB to consider the effect of the certificate of correction with the corrected lineage for the &rsquo;780 patent. The Federal Circuit then issued an order on June 27, remanding the case to the PTAB to consider in the first instance the effect, if any, of the certificate of correction. The Federal Circuit retained jurisdiction and stayed proceedings in the pending appeal while awaiting a PTAB decision on remand.</p> <p>The question presented on remand to the PTAB was whether the certificate of correction issued under section 255 can be applied retroactively. Section 255 provides an avenue for a patentee to seek correction of an issued U.S. Patent:</p> <p style="margin-left: 40px;">Whenever a mistake of a clerical or typographical nature, or of minor character, which was not the fault of the Patent and Trademark Office, appears in a patent and a showing has been made that such mistake occurred in good faith, the Director may, upon payment of the required fee, issue a certificate of correction, if the correction does not involve such changes in the patent as would constitute new matter or would require re-examination. Such patent, together with the certificate, shall have the same effect and operation in law on the trial of actions for causes thereafter arising as if the same had been originally issued in such corrected form.</p> <p>Emerson and SIPCO reprised their respective arguments on whether the reference to &ldquo;the trial of actions for causes thereafter arising&rdquo; in the second sentence of section 255 meant the PTAB should retroactively apply the certificate of correction. Emerson argued that an IPR qualifies as a &ldquo;trial of actions for causes&rdquo; under the second sentence of section 255, and the certificate of correction should therefore not apply retroactively, but should only apply going forward. Otherwise, Emerson argued, it would be prejudiced, and the PTAB&rsquo;s denial of SIPCO&rsquo;s request for leave to file the third request for a certificate of correction determined the request &ldquo;should not have any impact on the IPR.&rdquo; SIPCO countered by arguing that an IPR is not a &ldquo;trial of actions for causes&rdquo; in section 255, also pointing out that failing to give retroactive effect to certificates of correction under section 255 &ldquo;would waste Patent Office resources.&rdquo;</p> <p>In its decision, the PTAB declined to decide whether an IPR is &ldquo;a trial of actions&rdquo; under section 255. It stated, &ldquo;Assuming, without deciding, whether an <i>inter partes </i>review is such a &lsquo;trial of actions,' the statute makes a certificate of correction applicable only to actions arising <i>after</i> a certificate issues.&rdquo;</p> <p>According to the PTAB, &ldquo;the logical and natural reading of &sect; 255 is that, like &sect; 254 [correction of mistakes by the Patent Office], a certificate of correction for an applicant&rsquo;s mistake similarly does not receive retroactive application.&rdquo; The PTAB said &ldquo;[t]he statute [35 U.S.C. &sect; 255] does not contain any affirmative language indicating any intention to retroactively apply a certificate of correction,&rdquo; but did not fully analyze the absence of any statutory prohibition if an IPR is not a &ldquo;trial of actions.&rdquo; The PTAB referred to section 254, stating:</p> <p style="margin-left: 40px;">Sections 254 and 255 provide the following language giving effect to a certificate, stating it &lsquo;shall have the same effect and operation in law on the trial of actions for causes thereafter arising as if the same had been originally issued in such corrected form.&rsquo; Therefore, these sections expressly give effect to a certificate on a trial of actions for causes arising after the certificate issues. These sections do not contain any language, or otherwise provide any indication, that certificates generally should be given retroactive effect. Instead, these provisions unambiguously provide the circumstance in which a certificate under these sections are to be given effect.</p> <p>The PTAB cited the Federal Circuit&rsquo;s decision in <i>Southwest Software, Inc. v. Harlequin</i>, where the court rejected the retroactive application of a certificate of correction issued under a different statute, 35 U.S.C. &sect; 254. In <i>Southwest Software,</i> the court explained that the language in section 254 &ldquo;plays the role of establishing that, for all circumstances in which the certificate of correction is effective&mdash;namely, at all times after its issue date&mdash;the certificate is considered part of the original patent,&rdquo; and &ldquo;[m]oreover, it does not seem to us to be asking too much to expect a patentee to check a patent when issued in order to determine whether it contains any errors that require the issuance of a certificate of correction.&rdquo; The PTAB concluded, &ldquo;those considerations have equal applicability to &sect; 255&mdash;perhaps even greater import, [since] &sect; 255 addresses errors by the patentee. A lack of diligence by the patentee in correcting patent errors has potentially negative consequences for the public, who may allocate its affairs based on the patent as issued, <i>unaware</i> of any such error&rdquo; (emphasis added).</p> <p>The PTAB then pointed to correction of inventorship under 35 U.S.C.&nbsp;&sect; 256, which by its terms allows for retroactive application of corrected inventorship, whereas section 255 does not have a similar provision.</p> <p>Next, the PTAB cited the IPR statutes and rules granting the PTAB authority over another matter involving the &rsquo;780 patent before the USPTO. The PTAB argued there was an incongruity between having discretion to stay or prohibit filing of a request for a certificate of correction during an IPR and requiring retroactive effect after the Final Decision is issued and after an appeal to the Federal Circuit has been filed. The PTAB observed that issuance of a certificate of correction under section 255 is not a statutorily required action; rather, the issuance is discretionary because the USPTO Director &ldquo;may, upon payment of the required fee, issue a certificate of correction.&rdquo;</p> <p>SIPCO has appealed, and a Federal Circuit decision is expected in late 2020 or early 2021. Irrespective of who prevails, the case provides some lessons. In many cases it is wise to proofread an allowed application and the issued patent itself for proper priority claims. If any errors are discovered in an issued patent, the patentee should timely seek any certificate of correction or reissue to fix such errors and should carefully follow the USPTO rules in doing so.</p> <p>Please contact Fitch Even partner <a href=";A=2568&amp;format=xml&amp;p=5482">Kendrew H. Colton</a>, author of this alert, with any questions concerning this matter.<br /> &nbsp;</p> <p><b>Fitch Even IP Alert<sup>&reg;</sup></b></p>IP Alerts13 Feb 2020 00:00:00 -0800 Even Partner Nikki Little Receives 2020 Client Choice Award<p>Fitch Even partner <a href=";A=2598&amp;format=xml&amp;p=5482">Nikki L. Little</a> has been named the exclusive recipient of the 2020 Client Choice Award for Illinois in the category &ldquo;<a href=";recipientid=contact-fe8a2257f02f42e3b180132a6770379d-0cd4e1937a3845739a8a6f1d1788c26b&amp;utm_source=PANTHEON_STRIPPED&amp;utm_medium=PANTHEON_STRIPPED&amp;utm_campaign=PANTHEON_STRIPPED&amp;esid=023a446a-4c4e-ea11-a812-000d3a294748">Intellectual Property: Patents</a>.&rdquo;</p> <p>Established in 2005, <a href="">Client Choice</a>, in association with the International Law Office and Lexology, recognizes lawyers around the world who &ldquo;stand apart for the excellent client care they provide and the quality of their service. The criteria for this recognition focus on an ability to add real value to clients' business above and beyond&rdquo; others in the industry. Notably, lawyers are nominated exclusively by corporate counsel, with this year&rsquo;s winners chosen from a pool of more than 2,000 individual client assessments.</p> <p>Nikki is an IP litigator who represents clients in cases across a broad spectrum of technologies. She has participated in numerous jury and bench trials on behalf of clients ranging from individual inventors to multinational corporations. Nikki also represents clients in post-issuance proceedings in the USPTO in parallel with ongoing district court proceedings. She is cofounder and chair of Chicago Women in IP, a networking and mentoring organization committed to the connection, promotion, and success of Chicagoland-area women working in the field of intellectual property law.&nbsp;<br /> &nbsp;</p>Professional Activities13 Feb 2020 00:00:00 -0800 Even Elects New Partner and Equity Partners<p>Fitch Even is pleased to announce that <a href=";A=7667&amp;format=xml&amp;p=5482">Jennifer R. Andrew</a> has been elected partner and <a href=";A=2587&amp;format=xml&amp;p=5482">Paul B. Henkelmann</a> and <a href=";A=3766&amp;format=xml&amp;p=5482">Karen J. Wang</a> have been made equity partners of the firm, effective January 1, 2020.</p> <p><a href=";A=7667&amp;format=xml&amp;p=5482"><b>Jennifer R. Andrew </b></a>leverages her unique background and skills in serving clients in patent prosecution and preparation, IP licensing, and IP portfolio management. Her additional experience extends from providing freedom-to-operate and invalidity opinions and patent evaluations to working closely with inventors to develop and protect early-stage technologies. Jennifer counsels clients within diverse industries including food sciences, medical devices, mechanical and electronic devices and processes and biotechnology. Prior to joining Fitch Even, Jennifer was a patent attorney at the University of Illinois at Chicago. Among other responsibilities there she managed outside counsel regarding IP matters, drafted and negotiated a variety of agreements, and managed a large IP portfolio of early-stage biomedical, chemical, and mechanical technologies. Before becoming a lawyer, Jennifer worked as a forensic DNA scientist with the Michigan State Police for nearly a decade. Jennifer graduated <i>summa cum laude</i> from Michigan State University College of Law and holds a B.S. in Microbiology from Michigan State University.</p> <p><a href=";A=2587&amp;format=xml&amp;p=5482"><b>Paul B. Henkelmann</b></a> has substantial experience in patent post-issuance proceedings, IP litigation, U.S. and international patent prosecution, and IP portfolio management. Recognized for his active practice before the Patent Trial and Appeal Board, Paul has represented clients in dozens of <i>inter partes</i> review proceedings. He works with a wide range of technologies including medical devices, automotive systems, electronics, industrial machinery, and packaging. Paul earned his J.D. from Chicago-Kent College of Law, graduating with honors, and holds a B.S. in General Engineering with a minor in German from the University of Illinois at Urbana-Champaign.</p> <p><a href=";A=3766&amp;format=xml&amp;p=5482"><b>Karen J. Wang</b></a> assists clients ranging from individual inventors to multinational corporations with patent prosecution, post-issuance proceedings, and patent portfolio development and management. She has notable experience collaborating with foreign counsel in prosecuting both foreign and domestic applications for global clients and has represented clients in <i>inter partes</i> review and oral arguments at the PTAB. With her strong electrical engineering background, Karen is particularly qualified to work with technologies and product applications including network and Internet of Things (IoT) systems, autonomous machines and vehicles, electronic entertainment systems, e-commerce and retail logistics, and computer software. Karen is a graduate of the University of Texas School of Law and earned a B.S. in Electrical Engineering from the University of Illinois at Urbana-Champaign.</p> <p>Congratulations to Jennifer, Paul, and Karen!</p> <p>&nbsp;</p>Firm News11 Feb 2020 00:00:00 -0800 Alert: PTAB Cannot Invalidate Original Patent Claims Under 35 U.S.C. 112 in an IPR<p>On February 4, in <a href=""><i>Samsung Electronics America, Inc. v. Prisua Engineering Corp.</i></a>, the Federal Circuit held that the Patent Trial and Appeal Board (PTAB) may not invalidate claims for indefiniteness in an <i>inter partes</i> review (IPR) proceeding. The America Invents Act (AIA) limits the scope of a petition for IPR to grounds that &ldquo;could be raised under section 102 or 103.&rdquo; The <i>Samsung</i> decision emphasizes that this limitation further prevents PTAB final written decisions from invalidating existing claims under 35 U.S.C. &sect; 112 for indefiniteness.</p> <p>Samsung filed a petition at the PTAB, asserting that claims 1&ndash;4, 8, and 11 of Prisua&rsquo;s U.S. Patent No. 8,650,591 were invalid. The PTAB held claim 11 of the patent invalid for obviousness under 35 U.S.C. &sect;&nbsp;103, but declined to analyze whether claims 1&ndash;4 and 8 were invalid over the asserted grounds after concluding that claims 1&ndash;4 and 8 were indefinite. Accordingly, the PTAB held that Samsung had not established that claims 1&ndash;4 and 8 were unpatentable under any of the asserted grounds.</p> <p>The PTAB concluded that claim 1, and dependent claims 2&ndash;4 and 8, were indefinite for two reasons. First, the PTAB found that claim 1 improperly incorporates both apparatus and method limitations, rendering the claim indefinite under the Federal Circuit&rsquo;s prior <i>IPXL Holdings v.</i> case. Second, the PTAB found that the term &ldquo;digital processing unit&rdquo; recited in claim 1 was subject to analysis as a means-plus-function term under section 112, sixth paragraph. Applying means-plus-function analysis, the PTAB found that the &rsquo;591 patent failed to disclose corresponding structure and therefore rendered the term indefinite.</p> <p>Samsung presented two challenges on appeal: first, challenging the PTAB&rsquo;s decision not to declare claims 1&ndash;4 and 8 invalid for indefiniteness; and second, arguing that the PTAB should have applied the prior art to claims 1&ndash;4 and 8 even if they were indefinite. The Federal Circuit disagreed with Samsung&rsquo;s first argument and therefore affirmed the PTAB&rsquo;s refusal to declare claims 1&ndash;4 and 8 invalid for indefiniteness. The Federal Circuit agreed, however, with Samsung&rsquo;s second argument and remanded for analysis of invalidity under the asserted grounds.</p> <p>On the first issue, the Federal Circuit rejected statutory interpretations that would have allowed the PTAB to declare claims invalid for indefiniteness in the final decision on an IPR proceeding. The court explained the outcome is consistent with reasoning offered by the U.S. Supreme Court in <i>Cuozzo Speed Techs., LLC v. Lee</i>, that the PTAB would be acting &ldquo;outside its statutory limits&rdquo; by &ldquo;canceling a patent claim for indefiniteness under section 112 in [an] inter partes review.&rdquo; Accordingly, the Federal Circuit held that the PTAB cannot side-step the limitations on its statutory authority and hold claims invalid under section 112 even if an indefiniteness question is raised when construing the patent claims of the patent at issue in an IPR. The court explained that &ldquo;the proper course for the Board to follow, if [the PTAB] cannot ascertain the scope of a claim with reasonable certainty for purposes of assessing patentability, is to decline to institute the IPR or, if the indefiniteness issue affects only certain claims, to conclude that it could not reach a decision on the merits with respect to whether petitioner had established the unpatentability of those claims under sections 102 or 103. It would not be proper for the Board to cancel claims on a ground that is unavailable in an IPR.&rdquo;</p> <p>The AIA distinguishes, however, between original patent claims and substitute claims (amended or new claims) introducing during the IPR proceedings. Regarding new or amended claims, the court noted that the PTAB&rsquo;s statutory authority extends to other possible grounds of unpatentability, including indefiniteness under section 112.</p> <p>On the second issue, the Federal Circuit agreed that the PTAB should have assessed the patentability of claims 1&ndash;4 and 8 under the grounds asserted by Samsung. The court rejected the PTAB&rsquo;s conclusion that &ldquo;digital processing unit&rdquo; in claim 1 invoked means-plus-function analysis, and thus reversed the PTAB&rsquo;s corresponding reasoning for stating patent claims 1 and 4&ndash;8 could not be analyzed for anticipation under section 102 or for obviousness under section 103. Further, the court concluded that the <i>IPXL</i> indefiniteness issues do not prevent analysis of invalidity under additional grounds.</p> <p>Regarding the proper interpretation of &ldquo;digital processing unit,&rdquo; the Federal Circuit held that this term clearly serves as a stand-in for &ldquo;general purpose computer&rdquo; or a &ldquo;central processing unit,&rdquo; and that it therefore connotes sufficient structure to avoid means-plus-function interpretation. The Federal Circuit noted that the PTAB&rsquo;s analysis was inconsistent. For claim 1, the PTAB concluded that &ldquo;digital processing unit&rdquo; failed to convey structure, but it also held that the asserted art disclosed structure corresponding to the same phrase in claim 11.&nbsp;</p> <p>In regard to the so-called <i>IPXL</i> rationale, the court ruled the PTAB prematurely ended its analysis. Indefiniteness under <i>IPXL</i> is based on the reasoning that infringement analysis is impossible if claims include both method and apparatus limitations. But invalidity can be shown if the prior art includes either a method or apparatus with the required limitations. Thus, indefiniteness under <i>IPXL</i> does not prevent analysis of invalidity under separate obviousness or anticipation grounds. Accordingly, the Federal Circuit remanded for consideration of statutorily authorized grounds for invalidity (anticipation or obviousness) based on the prior art as applied in Samsung&rsquo;s IPR petition.</p> <p>The <i>Samsung</i> case establishes that the PTAB cannot render claims invalid for indefiniteness during IPR proceedings instituted against existing claims. Although this seemingly benefits patent owners who have one less issue to fear during IPR proceedings, petitioners also benefit because it is now more settled that IPR decisions will not create estoppel against raising indefiniteness in subsequent proceedings&mdash;for example, in district court.</p> <p>The <i>Samsung</i> case is also interesting in view of other recent developments related to PTAB procedure. This is the second decision in as many weeks where the Federal Circuit has opined on issues related to the scope of the PTAB&rsquo;s authority to hear a case. In <i>Koninklijke Philips v. Google</i>, decided on January 30, 2020, the Federal Circuit held that the PTAB erred by instituting an IPR based on a combination of references not advanced in the petition. Both of these cases place limits on the PTAB&rsquo;s authority to institute an IPR, but neither case addresses whether such IPR institution decisions are reviewable. This seemingly runs contrary to the AIA&rsquo;s &ldquo;no appeal rule&rdquo; for PTAB institution decisions. The Supreme Court interpreted that &ldquo;no appeal rule&rdquo; strictly, restricting appeals from institution decisions, in the <i>Cuozzo Speed Technologies Techs. v. Lee </i>case.</p> <p>Subsequent Federal Circuit cases have chipped away at the <i>Cuozzo</i> decision, for example allowing appeals related to the one-year time bar that prevents petitioners from seeking an IPR more than a year after they have been served with a complaint for patent infringement. One of those cases, <i>Thryv, Inc. v. Click-to-Call Technologies, LP</i>, is now pending at the Supreme Court. The Supreme Court&rsquo;s decision in that case could limit the Federal Circuit&rsquo;s power to review cases such as the present <i>Samsung</i> case. Fitch Even attorneys will continue to monitor developments related to this case.</p> <p>For more information on this case, please contact Fitch Even partners <a href=";A=2585&amp;format=xml&amp;p=5482">David A. Gosse</a> and <a href=";A=2568&amp;format=xml&amp;p=5482">Kendrew H. Colton</a>, coauthors of this alert.<br /> &nbsp;</p> <p><b>Fitch Even IP Alert<sup><sub>&reg;</sub></sup><br /> </b></p>IP Alerts11 Feb 2020 00:00:00 -0800 Even Sponsors Chicago Women in IP Post-Holiday Dinner<p>Fitch Even was proud to be a platinum sponsor of Chicago Women in IP&rsquo;s Fifth Annual Post-Holiday Dinner on January 22 at the Dalcy at Aba in Chicago. The sold-out event began with open networking and continued with a lively, interactive progressive dinner attended by IP professionals from leading Chicago corporations, law firms, law schools, and service providers.</p> <p>Fitch Even attorneys attending the dinner included event co-organizer and ChiWIP co-founder and chair <a href=";A=2598&amp;format=xml&amp;p=5482">Nikki Little</a>, ChiWIP board member <a href=";A=2607&amp;format=xml&amp;p=5482">Calista Mitchell</a>, ChiWIP committee member and event moderator <a href=";A=2599&amp;format=xml&amp;p=5482">Amanda Lowerre O'Donnell</a>, Carrie Schneider, Kerianne Strachan, Jackie Thompson, Mark Hetzler, Tim Maloney, Joe Marinelli, and Nick Peters.</p> <p><a href="">Chicago Women in IP</a> is a vibrant networking and mentoring organization committed to the connection, promotion, and success of Chicagoland-area women working in the field of intellectual property law.</p>Professional Activities05 Feb 2020 00:00:00 -0800 Even Partners Named to Illinois Super Lawyers for 2020<p>Nine Fitch Even partners have been selected for inclusion in the 2020 list of Illinois Super Lawyers<i>. </i>No more than five percent of all lawyers in the state are selected by the research team at Super Lawyers to receive this honor each year.</p> <p><a href=";A=2581&amp;format=xml&amp;p=3130">Karl R. Fink</a>, <a href=";A=2601&amp;format=xml&amp;p=3130">Timothy P. Maloney</a>, and <a href=";A=18289&amp;format=xml&amp;p=5482">Stanley S. Schlitter</a> were once again recognized as top attorneys in Intellectual Property Litigation in Illinois. <a href=";A=2598&amp;format=xml&amp;p=5482">Nicole L. Little</a> was recognized as a top attorney in Intellectual Property Litigation for the first time, after having been named an Illinois Rising Star in previous years.</p> <p>In addition, <a href=";A=2580&amp;format=xml&amp;p=5482">Stephen S. Favakeh</a>, <a href=";A=2588&amp;format=xml&amp;p=5482">Mark W. Hetzler</a>, <a href=";A=2589&amp;format=xml&amp;p=5482">Allen E. Hoover</a>, <a href=";A=2609&amp;format=xml&amp;p=5482">Joseph T. Nabor</a>, and <a href=";A=2616&amp;format=xml&amp;p=3130">Joseph E. Shipley</a> were once again recognized as top attorneys in Intellectual Property Law in Illinois.</p> <p>Super Lawyers<sup>&reg;</sup>, a Thomson Reuters business, is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement. Attorneys are selected using a multiphase process that includes independent research, peer nominations, and peer evaluations. For more information, please visit <a href=""></a>.</p> <p>&nbsp;</p>Firm News31 Jan 2020 00:00:00 -0800 Alert: Federal Circuit Holds District Courts Cannot Hear Challenges to PTAB Decisions<p>On January 10, in <a href=""><i>Personal Audio, LLC v. CBS Corporation</i></a>, the Federal Circuit held that district courts lack jurisdiction to consider final written decisions of the Patent Trial and Appeal Board (PTAB).</p> <p>In 2013, Personal Audio sued CBS, alleging infringement of U.S. Patent No. 8,112,504, which generally covers &ldquo;a system for organizing audio files, by subject matter, into &lsquo;program segments.&rsquo;&rdquo; Subsequently, a third party, Electronic Frontier Foundation, petitioned for an <i>inter partes</i> review (IPR) of certain claims of the &rsquo;504 patent. In 2015, the PTAB issued a final written decision, concluding that the challenged claims were unpatentable, and in 2017 the Federal Circuit affirmed this decision.</p> <p>In 2018, the district court entered judgment for CBS, and the USPTO issued a certificate canceling the challenged claims of the &rsquo;504 patent.</p> <p>Personal Audio appealed to the Federal Circuit, seeking in part to overturn the PTAB&rsquo;s decision and raising several constitutional challenges to same. Rejecting the appeal, the court observed that Congress exercised its judicially affirmed power to specify jurisdiction through the Administrative Procedure Act, requiring patentees that are dissatisfied with the result at the PTAB to appeal directly to the Federal Circuit. As such, the court held that there was no procedural mechanism for Personal Audio to challenge the PTAB&rsquo;s decision in the district court.</p> <p>The court analogized the case to an earlier Supreme Court case, <i>Elgin v. Department of Treasury</i>, in which the Court examined whether district courts can review a federal agency&rsquo;s final adverse decision against an employee under the Civil Service Reform Act (CSRA). The implementing statute provides that dissatisfied employees may appeal to the Merit Systems Protection Board, and from there to the Federal Circuit. There, the Court held that in light of statutory language and &ldquo;the painstaking detail with which the CSRA sets out the method for covered employees to obtain review of adverse employment actions, it is fairly discernible that Congress intended to deny such employees an additional avenue of review in district court.&rdquo;</p> <p>Here, the Federal Circuit came to a similar conclusion with regard to PTAB decisions. The controlling statute, 35 U.S.C. &sect; 319, states that a &ldquo;party dissatisfied with the final written decision . . . under section 318(a) may appeal the decision pursuant to sections 141 through 144.&rdquo; Section 141, for example, provides that a party dissatisfied with a final written decision of the PTAB may appeal the decision &ldquo;only to the United States Court of Appeals for the Federal Circuit.&rdquo; Finally, the Federal Circuit noted that Congress granted it &ldquo;<i>exclusive</i> jurisdiction&rdquo; to hear such appeals under another statute, 28 U.S.C. &sect; 1295(a)(4)(A).</p> <p>Thus, the Federal Circuit concluded that the district court did not have jurisdiction to hear Personal Audio&rsquo;s appeal of the PTAB decision regarding the &rsquo;504 patent. This case provides guidance to litigants before the PTAB.</p> <p>For more information, please contact Fitch Even attorney <a href=";A=18118&amp;format=xml&amp;p=5482">Vincent R. Meyer</a>, author of this alert.</p> <p><b><br /> </b><b>Fitch Even IP Alert<sup>&reg;</sup> <br /> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b></p>IP Alerts22 Jan 2020 00:00:00 -0800 Even Partner Sherri Blount Quoted in <i>WWD</i> Article on Celebrity Photo Copyright Infringement<p>Fitch Even partner <a href=";A=2575&amp;format=xml&amp;p=5482">Sherri N. Blount</a> was quoted in the December 9 issue of <i>Women&rsquo;s Wear Daily</i> in an article discussing how brands are facing increased scrutiny over permission rights of celebrity images found online.</p> <p>In the article, &ldquo;Online Celeb Photos and Legal Risks for Brands,&rdquo; Sherri advises, &ldquo;If you&rsquo;re a brand using someone&rsquo;s name, their photo, their likeness, or even the sound of their voice, you should first contact the person or the person&rsquo;s agent and get permission and a license to use it for the purposes you want to use it&mdash;and preferably written permission.&rdquo; She goes on to say, &ldquo;If the brand is trying to use it for a commercial purpose, they may need to get the permission of both: the celebrity and the photographer.&rdquo; The article can be read in its entirety on the <a href=""><i>WWD</i> website</a> (sub. req.).</p> <p>Sherri advises clients on a broad range of promotions, marketing, and advertising issues, as well as entertainment and media matters. She has extensive experience in trademark and brand protection, complex licensing agreements, trade secrets, unfair competition, copyright and infringement issues, work-for hire arrangements, and digital rights management.<br /> <br /> &nbsp;</p>Professional Activities17 Jan 2020 00:00:00 -0800