TIPLJ: Volume 29
Issue 1 – Fall 2020
Did The America Invents Act Change University Technology Transfer?
Citation: 29 Tex. Intell. Prop. L.J. 1 (2021)
Author: Cynthia L. Dahl
About: Practice Professor of Law at the University of Pennsylvania Carey School of Law in Philadelphia.
The Leahy–Smith America Invents Act (AIA) is approaching its ten-year anniversary. When it was signed into law in 2011, it was intended to be the grandest overhaul of the U.S. patent system in fifty years. Consequently, the AIA makes bold and sweeping changes to the U.S. patent filing system that impact which patents issue, give certain advantages to a subset of filers, and greatly expand the ability to challenge the validity of a patent even after it has issued.
Universities stood to be especially affected by the AIA. Changes that force a patent owner to file quickly to secure rights are particularly challenging to universities, where discoveries are often early stage and there is a culture of disclosure. In addition, the AIA’s changes to establish and clarify procedures to invalidate patents
even after they are granted casts a pall over the long-term value of patents. Given the number of patents that universities file and the great value of some of their patent assets, the AIA shifts were cause for concern. The AIA’s potential to make both securing and maintaining patent coverage more difficult caused university technology
transfer offices (TTOs) to fear the law would chip away at their business model based
on protecting and licensing inventions.
Disclosing AI Inventions
Author: Mehdi Poursoltani
About: J.D. received in 2019 from the University of San Diego School of Law.
Given the significant increase in the number of artificial intelligence (AI)-related publications and patents, this article examines the required standard of disclosure concerning AI inventions. Machine learning algorithms are used as a test case to show the differences between AI inventions and conventional software. The article then examines how the non-deterministic and black-box nature of AI models distinguish them from traditional software. Furthermore, it discusses the relationship between the predictability of a field of technology and the required disclosure. Accordingly, it explains the issue of predictability regarding the field of biotechnology and compares machine learning models with biotechnology inventions. The article concludes that AI inventions may require an elevated level of disclosure compared to conventional software.
The Effect of the USPTO’s Quality-Improving Initiatives in 2000 on the Claim Scope of Business Method Patents
Citation: 29 Tex. Intell. Prop. L.J. 67 (2021)
Author: Teruki Amano
About: Deputy director of policy planning and research division, Japan Patent Office.
Patent quality and value has concerned society for over two decades while the U.S. patent system has undergone significant changes in many ways. After the patentability of software patents was judicially confirmed in the State Street Bank decision, the granting of some arguably overly broad business method or software related patents, and subsequent litigation based on those patents have caused concerns. The most recent debate on patent subject matter eligibility under 35 U.S.C. § 101 is also within the scope of the issue of patent quality and value in the broadest sense.
Although there was a time when the U.S. Patent and Trademark Office (USPTO)was said to be regularly issuing bad patents, the agency had also shared concerns and adopted many initiatives to improve patent quality. Following these initiatives, why is the discussion on patent quality still ongoing? It may be that the USPTO’s attempts were not enough, or it may be that the initial problems were adequately addressed, but new challenges have surfaced. Either way, knowing the effectiveness of each of the USPTO’s initiatives is essential to an informed debate on these issues.
Copyright, Tattoos, and Animated Likeness: Why Size Should Not Matter
Citation: 29 Tex. Intell. Prop. L.J. 85 (2021)
Author: Mark Marciszewski
About: J.D. received in 2020 from the University of Virginia School of Law.
Once considered a taboo form of expression, tattoos have become increasingly popular and accepted in modern American society. With tattoos’ ever-increasing popularity, more and more people have inked their skin with tattoos. The increase in tattoos has not just occurred among the average population. From famous athletes and musical artists to movie stars and models, many celebrities and prominent figures have tattoos that have become synonymous with their image and brand. The increased prevalence of tattoos has led to the legal debate surrounding the extent of the copyright interests of tattoos. This legal debate has only been expedited by the high visibility of some well-known tattooed individuals. Although some legal questions have had clear answers, like a tattooed individual’s ability to publicly display their tattooed skin publicly, other legal issues have not been fully settled by the courts.
Issue 2 – Spring 2021
Strategic Behavior in Standards Development Organizations in Times of Crisis
Citation: 29 Tex. Intell. Prop. L.J. 127 (2021)
Author: Panagiotis Delimatsis, Olia Kanevskaia, and Zuno Verghese
About: Professor of Law, Tilburg Law and Economics Center (TILEC), Tilburg Law School, the Netherlands.
Recent cases such as Continental v. Avanci and FTC v. Qualcomm drew attention to the limits of protecting intellectual property rights (IPR) in the standardization ecosystem. While conflicting interests in standard setting abound, considerations regarding the inclusion and subsequent treatment of proprietary elements in a technical standard hold the lion’s share of concerns that Standards Development Organizations (SDOs) have to deal with. To balance the interests at stake, SDOs adopt patent policies that members must observe in order to participate in SDOs’ activities. Like other rules governing the work of SDOs, patent policies may be modified following the prescribed procedures. However, any subsequent changes to an organization’s operational framework, including its intellectual property (IP) rules, may distort prior expectations and “lock in” members to rules that they never intended to abide by. Against this backdrop, this Article seeks to explore how SDO members respond to IP-rule amendments by offering a taxonomy of strategies that are adopted by members opposing modifications. Drawing upon the example of the Institute of Electrical and Electronics Engineers (IEEE) revised Patent Policy of 2015, this Article studies how IEEE members responded to instances of organizational distress such as an update of IP policies within an SDO, by using stakeholders’ willingness to commit to the new licensing rules and previous examples of strategies in other SDOs when misunderstandings around IP arose as proxies. At a normative level, this Article further discusses the effect that such changes may have on the nature and structure of a given industry and offers a novel classification of reactions to tipping points in the standards development realm. In doing so, this Article contributes to the currently underdeveloped body of research on strategic behavior, institutional dynamics, and crisis management in technological standardization.
Inclusive Patents for Open Innovation
Citation: 29 Tex. Intell. Prop. L.J. 187 (2021)
Author: Toshiko Takenaka
About: Washington Research Foundation Professor of Technology Law, University of Washington School of Law; Professor, Keio University Law School.
The post-internet era has greatly affected commercial firms’ innovation processes. The complexity and cumulative nature of emerging technologies under the post-internet era has made commercial firms reevaluate their innovation processes and has increased the role of individual innovators. Firms dealing with emerging technologies cannot make products without infringing on patents held by others, as their products are covered by numerous overlapping patents. Many of these firms work with individual innovators and embrace the open-source philosophy that ensures open access to technologies. These firms can no longer use patents for excluding others without risking infringement counterclaims, leading to the development of new uses of patents: defensive use to avoid litigation and proactive use to promote open innovation. The current U.S. patent has become increasingly outdated for failing to take into account these new uses of patents. Although firms have implemented self-help arrangements by retooling patents with licenses and private-ordering mechanisms, the arrangements still fall short as they result in: (1) no defensive function against patent assertion entities (PAEs) and (2) insufficient proactive use if innovators fail to disclose their invention through USPTO, due to expensive patent costs. Patent reform is necessary to overcome such shortcomings. In light of recent changes, this article proposes issuing inclusive patents as an alternative option to current exclusive patents. The proposed inclusive patents allow anyone who licenses their patented inventions to practice the protected invention, and are only enforced defensively when the owners are charged with infringement. The inclusive patents enable owners to request a preliminary procedure to grant a compulsory license in light of the eBay factors when they are charged with infringement of blocking patents. The compulsory license enhances the defensive use of inclusive patents to avoid litigation with PAEs, and guarantees owners the freedom to operate and innovate on their inventions. Because of the limited exclusivity, the USPTO should allow simplified patent applications and issue inclusive patents without examination. With low patent costs, all types of innovators can take advantage of the proactive use of inclusive patents through USPTO disclosures.
The Semantics of Authorial Originality: Four Pillars
Citation: 29 Tex. Intell. Prop. L.J. 235 (2021)
Author: Molly Torsen Stech
About: Ms. Stech is a New York attorney working on international copyright policy issues.
In March 2017, the U.S. Supreme Court published its opinion in Star Athletica, LLC v. Varsity Brands, Inc.; in September of 2019, the Court of Justice of the European Union published its opinions in Cofemel v. G-Star Raw CV; and in June 2020, its opinion in Brompton Bicycle Ltd v. Chedech. The American case treats the copyrightability of a design on cheerleading uniforms, and the European cases treat the copyrightability of the design of denim jeans and the design of a folding bicycle, respectively. Copyright protection for articles of clothing and designs differs markedly between the United States and Europe, but this particular trio of high court cases construes something more fundamental while parsing the contours of useful articles under their respective laws: they draw attention to the existing legal landscapes for determining originality. If originality is the sina qua non of copyright law, per 1991’s U.S. Supreme Court opinion in Feist Publ’ns v. Rural Tel. Serv. Co., then these cases, and the laws and cases they rely on, present some new—and some old—guidance and lingering questions regarding the very underpinning of copyrightability.
This paper explores and compares American and European law, underscores similarities between them and inconsistencies within them, and concludes that originality remains an essentially intimate, human faculty, and one that escapes legal definition across creative media. That said, aspects of copyright law save it from itself, for example by conferring stronger protection on works that demonstrate a higher saturation of creativity. As the digital economy grows and shines a light on the distinctions between individual jurisdictions’ copyright laws, the modest—but steadfast—hurdle to copyrightability remains indicia of ideation, imagination, and individuality. This is especially important right now as countries consider whether artificial intelligence is or should be eligible to claim authorship in the works they produce. While “author’s own intellectual creation” is European verbiage describing the floor for authorial originality for the Member States of the European Union, it is equally serviceable in the United States and elsewhere. Because the types of works considered copyrightable are potentially expanding on both sides of the Atlantic based on the Court decisions listed above, it is important to demonstrate, firstly, that originality in a work is not a foregone conclusion and, secondly, that many jurisdictions share an approach, if not a specific test or definition, for finding originality.
Express Yourself: A Personal Use Privilege for the Subjects of Copyrighted Works
Citation: 29 Tex. Intell. Prop. L.J. 273 (2021)
Author: Jaden Warren
About: J.D. Candidate, University of Texas School of Law, expected graduation Spring 2021.
In the past couple years, there has been a bevy of copyright lawsuits filed due to photographs posted on social media without the photographer’s consent. More generally, this conflict exists in any situation in which a copyrighted work represents the individual and the copyright owner withholds consent for the represented individual to post the work online. This Note poses and evaluates the following dilemma: do individuals have a right to use media in which they are represented? Additionally, if such a right exists, to what extent does it exist? This Note argues that the subject of a copyrighted work has an urgent personal interest in the use of such work, justifying a privilege to use the work that outweighs the author’s copyright. Part I of this Note evaluates the normative foundation of copyright for the author of a work. Part II of this Note assesses potential theoretical bases for an individual usage right of copyrighted works in which the individual is represented. Part III of this Note considers the limitations and implications of such a usage right. Part IV details the existing legal framework surrounding this issue and proposes a legislative reform to create a personal use privilege for the subjects of copyrighted works. Part V concludes.
Issue 3 – Summer 2021
Franchising Lessons in the Age of Incivility: Operations Manuals and Trade Secrets
Citation: 29 Tex. Intell. Prop. L.J. 305 (2021)
Author: Robert W. Emerson
About: Huber Hurst Professor of Business Law at the University of Florida.
The framework for a successful franchise relationship governs procedures, performance, and standards. The franchisor agrees to lend, in effect, its intellectual property and guidance, among other things, in exchange for the franchisee’s royalties and other payments. Before entering into an agreement, franchisors disclose a large bundle of information to the prospective franchisee. The data may include operational insights necessary for a franchise’s success. In practice, though, franchise operations manuals only become available to franchisees once they pay for and are bound to the franchise system. This timing, and the centrality of the manual, is the key to many franchise disputes. For example, franchisees may allege they were harmed by vague, precontractual representations about the contents of operations manuals, and in turn franchisors would justify the terminology they use as a way to provide the required disclosures while protecting trade secrets.
When operations manuals are leaked—whether negligently, maliciously, or recklessly—or when the franchisee (or ex-franchisee) uses the manual’s processes and information without permission, then trade secret or antitrust law may impute liability. In Civility Experts Worldwide v. Molly Manners, LLC, a franchisor claimed its franchisee infringed the franchisor’s copyright by promoting a service that competed against the franchise network; while the franchisee allegedly used the franchisor’s trade secrets in spite of the two parties’ preexisting relationship barring such conduct, Molly Manners illustrates how the franchisor could have proactively amended the franchise agreement to delineate franchisee duties and prohibitions. A franchisor could file claims against its franchisee under the law of trademarks, trade secrets (e.g., the Uniform Trade Secrets Act or the Defend Trade Secrets Act), and antitrust. Lessons that emerge from this Article’s survey of franchise law and practice can serve as guiding principles for franchisors and franchisees alike.
Strategy and Abuse in Massive Patent Assertions at the Extremes of Patent Litigation
Citation: 29 Tex. Intell. Prop. L.J. 363 (2021)
Author: Richard Gruner
About: Former Director of the Center for Intellectual Property at the John Marshall Law School in Chicago.
Given the significant increase in the number of artificial intelligence (AI)-related publications and patents, this article examines the required standard of disclosure concerning AI inventions. Machine learning algorithms are used as a test
This article examines high-volume patent litigation by patent owners asserting a few patents in extremely large numbers of cases. Using data on millions of patents and related patent litigation, the study evaluates two types of distinctive high-volume litigation behaviors. The first involves large-scale litigation of patents that are specially crafted in extended patent application proceedings. These extended proceedings allow patent applicants to learn about infringing actions of potential litigation targets and to match patent terms to those infringing activities. Large-scale patent litigation based on patents crafted in this way constitutes the end game in liability maximizing processes stretching back to earlier points when patents were tailored to be effective in litigation. The litigants involved are highly specialized and sophisticated not only in how they conduct patent litigation but also in the preliminaries of patent tailoring that set up favorable patent litigation opportunities. These aggressive patent litigators utilize opportunities within the patent system twice over—once in seeking patent contents that are particularly favorable in litigation and again in pressing many cases in parallel based on the well-crafted patents they obtain.
A second group of patent owners initiating high-volume patent litigation appear to pursue more abusive patent cases. Significant numbers of patents asserted by these owners in large numbers of cases—sometimes in hundreds of cases per patent—are later abandoned as worthless (because the owners refuse to pay modest maintenance fees needed to keep the patents in force for their full potential terms). Thousands of patent cases have been based on ultimately abandoned patents.
The present study evaluates 2,805,982 United States utility patents issued between 1985 and 2007 and related litigation. This research is made possible by a recently compiled database describing over 55,000 patent cases filed from 2003 to 2016. Data on the patents asserted in these cases was matched with further data on patent maintenance fee payments revealing patent owners’ assessments of patent value. Patent maintenance fees needed to keep patents in force are modest in comparison with the potential value of the patents affected if successfully asserted in litigation or otherwise utilized (through licensing or sales of patented products) to produce patent-enhanced profits. Patent owners’ refusal to pay maintenance fees—and the consequent early lapsing of patent rights—is a signal that the owners felt their lapsed patents were essentially worthless in litigation and commercial contexts.
Large-scale litigation based on ultimately abandoned patents is the exception, not the rule. Most litigated patents are valued by their owners (as evidenced by full payment of related maintenance fees). Approximately 80 percent of the litigated patents evaluated in this study (corresponding to approximately 78 percent of patent assertions in federal cases) were extended to their full terms via payment of all required maintenance fees. Most patents deemed worthless and cast aside through non-payment of maintenance fees are also excluded from litigation. The patent maintenance fee system imposed in the United States in 1981 prompts useful valuation assessments that filter out many worthless patents from patent enforcement generally and patent litigation in particular.
However, a few extensively litigated but ultimately abandoned patents—including many patents in the top one percent most litigated patents, each asserted in 26 cases or more—account for enormous numbers of patent cases. Of the 295 patents in this top one percent (asserted in a total of 15,872 patent cases), 28 patents (or about 10 percent) were allowed to expire before the end of their full terms due to non-payment of maintenance fees. These abandoned patents—apparently accepted as worthless by their owners—were nonetheless asserted in 2,098 patent cases. The most frequently litigated among the abandoned patents was pressed in 470 cases. This type of high-volume litigation based on patents of dubious value (suspect even in the eyes of the patents’ owners) deserves careful reassessment and reform to prevent further unwarranted commercial intimidation and wasted judicial resources in suits asserting worthless patents.
The “Agencies” of Copyright Law: Constitutional and Administrative Law on the CASE Act of 2020
Citation: 29 Tex. Intell. Prop. L.J. 415 (2021)
Author: Carissa Wilson
About: Graduate of the University of Chicago Law School and an associate in the Intellectual Property Group at Crowell & Moring LLP in Washington, DC.
Amid a multitude of recommended copyright reforms, one major issue recently addressed by Congress is the problem of copyright small claims non-adjudication. Litigating a copyright case through appeal costs an average of roughly $350,000, is often time-consuming, and may be complicated by the difficulty of finding an attorney willing to litigate small claims cases. In contrast, a typical copyright infringement claim may often be valued at less than $3,000. In cases where damages awards are likely to be small, many copyright owners have no incentive to sue infringers, even for clearly meritorious claims. Where copyright owners have no incentive to sue to enforce their rights, users may be more likely to infringe. Rampant infringement disincentivizes creation. Copyright law, a regime based on Article I, section 8, clause 8 of the U.S. Constitution, aims to increase incentives to create. Thus, routine, cost-based non-adjudication of small claims undermines the very purpose of copyright law.
Congress’s chosen solution to the small claims non-adjudication problem is the Copyright Alternative in Small-Claims Enforcement (CASE) Act of 2020. The CASE Act creates a “Copyright Claims Board,” a seemingly quasi-judicial body, within the U.S. Copyright Office. The CASE Board is expected to operate as, effectively, a small claims court within the Office, providing a streamlined, reduced cost, and purportedly voluntary resolution procedure for copyright claims, subject to an award cap of $30,000 per proceeding. Under the CASE Act, eligible copyright claimants may initiate CASE proceedings against alleged infringers who, in turn, may opt out of the process. If the defendant opts out, the plaintiff may bring the infringement suit in federal court, in which case both parties almost assuredly incur significant additional expense. If the defendant does not opt out, the Board will evaluate the claim on the basis of written submissions, calls, and other remote communication, often without the need for appearances or even an attorney. Decisions of the Board are final and can be appealed only on limited grounds. If a defendant fails to respond, the opt-out nature of the CASE system permits a default judgment to be entered.
Although this latest iteration of the CASE Act has achieved the coveted status of law, the Act itself is not without controversy. Specifically, questions have been raised about the permissibility of Board resolution of infringement claims, a seemingly judicial function that might violate important legal precepts like separation of powers and prohibitions against branch aggrandizement/diminution. Although executive agencies are sometimes permitted to carry out quasi-judicial functions under constitutional and administrative law, that capacity is limited. Furthermore, the Board created by the CASE Act is not part of any obviously executive body. As proposed by the CASE Act, the Board would sit within the U.S. Copyright Office. The Copyright Office is a service unit of the Library of Congress, and the Library is generally thought to be part of the legislative branch. A seemingly open question exists as to whether legislative agencies, too, can perform limited quasi-judicial functions.
This paper evaluates whether the copyright small claims board created by the CASE Act violates constitutional and/or administrative law. It does not consider all possible legal arguments against the CASE Act, but instead focuses on organizational considerations implicating the separation of powers and closely related concerns. Section II examines the uncertainty surrounding the administrative identities of the Library of Congress, the Copyright Office, and the CASE Board as either legislative or executive bodies. Section III describes constitutional and administrative law-based concerns attributable to the CASE Board’s possible administrative identities. Finally, Section IV assesses whether any permissible construction of the CASE Board exists or could be achieved through plausible amendments to the Act. This paper concludes that the best resolution of CASE Act separation of powers concerns, and best safeguard against constitutional or administrative law challenge, would be to position the desired small claims board within an executive branch agency. Ultimately, this resolution would require greater reorganization of copyright administrative law than mere revision of the CASE Act itself would likely permit.