TIPLJ: Volume 8
Issue 1 – Fall 1999
The Charade: Trying a Patent Case to All “Three” Juries
Citation: 8 Tex. Intell. Prop. L.J. 1 (1999)
Author: Ted D. Lee & Michelle Evans
About: The authors are attorneys at Gunn, Lee & Keeling, San Antonio, Texas. The authors wish to thank Hsin-Wei Luang and Steve Toland for their invaluable assistance in researching and proofing this Article.
Abstract: The en banc decisions by the Federal Circuit in recent years have been heated with strongly differing views. In Markman v. Westview Instruments, Inc., this friction is immediately apparent in the strongly worded concurring opinion of Judge Mayer and the dissenting opinion of Judge Newman. The Federal Circuit was even more divided—although the concurring and dissenting opinions were not as sharply worded—in Hilton Davis Chemical Co. v. Warner-Jenkinson Co., Inc. Even the decision of In re Lockwood contains a vigorously worded dissenting opinion.
Despite these strong divisions, the Federal Circuit has essentially become a court of last resort on substantive patent law issues. The Federal Circuit was created in 1982 and has exclusive jurisdiction over all appeals in patent cases from district courts. In its first decision, the Federal Circuit adopted as controlling authority decisions from the United States Supreme Court and the Federal Circuit’s predecessor courts—the Court of Customs and Patent Appeals and the Court of Claims. The Federal Circuit has chastised attorneys for citing authority on substantive patent law from circuits other than the Federal Circuit. It quickly became clear to those practicing before the Federal Circuit that this court was developing a uniform body of law for trying intellectual property cases.
To date, the Supreme Court has not overruled the Federal Circuit on a major substantive patent law issue. The Supreme Court had a prime opportunity to rule on the Federal Circuit’s determination of substantive patent law issues during the appeals of Markman and Hilton Davis. Instead, the Court rubber-stamped the opinion of the Federal Circuit in Markman. In Hilton Davis, the Court did not overturn the Federal Circuit’s finding that patent infringement under the doctrine of equivalence was a question of fact. Instead, the Supreme Court validated the doctrine of equivalents, but did take the opportunity to clarify that an “element-by-element” analysis should be used, which the Federal Circuit had failed to do. In addition, the Supreme Court declined to adopt a more rigid rule allowing prosecution history estoppel no matter the reason for the change, but did adopt a rebuttable presumption of estoppel for the patentee when it is not clear from the prosecution record why an amendment was made. When the Federal Circuit recently changed the substantive law by allowing patent protection for computerization of a business method, the Supreme Court denied certiorari, thereby making the Federal Circuit the final authority.
After Hilton Davis, the Supreme Court had an opportunity in Shoketsu Kinzoku Kogyo Kabushiki Co., Ltd. v. Festo Corp. to address two important patent law issues, the doctrine of equivalents and the limits of prosecution history estoppel. Instead, the Court sent the case back to the Federal Circuit. The Federal Circuit has granted a rehearing en banc to determine the limits of these two issues.
This Article is for the attorney who may try a patent case in front of a jury. In light of these recent rulings by the Federal Circuit as well as the Supreme Court’s deference to the Federal Circuit, the attorney representing the patent holder will essentially have to convince three juries of the merits of their case. These “juries” include (1) the traditional jury, (2) the Federal Circuit, and (3) the trial judge.
Understanding Willfulness in Patent Infringement: An Analysis of the “Advice of Counsel” Defense
Citation: 8 Tex. Intell. Prop. L.J. 39 (1999)
Author: Shashank Upadhye
About: J.D., LL.M. Mr. Upadhye is a Patent and Trademark Counsel for the Cook Group, Inc., Bloomington, IN.
Abstract: This Article examines the entire legal regime surrounding willful infringement and the “advice of counsel” defense. Part II. A discusses the statutory scheme and the background to finding willfulness for the purposes of treble damages. Part III discusses non-infringement opinions written by counsel and the attorney-client privilege shielding such opinions from discovery. Part IV generally examines the nature of the non-infringement opinions. In particular, it provides a detailed legal analysis of two overriding themes: (a) the competency of the opinion; and (b) the legal sufficiency of the opinion. Furthermore, Part IV examines the general infringement scheme and correlates each phase of infringement litigation with the sufficiency of the opinion. The sufficiency of an opinion with respect to claim construction, literal infringement, and equivalency infringement is examined. Part V of the Article discusses patent invalidity opinions and the various grounds on which a patent can be invalidated. The Article also examines case law discussing the sufficiency of opinions, and thus provides guidance to U.S. district court judges who adjudicate these issues, or to patent practitioners in drafting a judicially defensible opinion. It is crucial for the author who prepares a non-infringement or invalidity opinion to examine every way in which the opinion can be criticized. In the end, the opinion that addresses all of the considerations addressed herein, where appropriate, will likely survive attack and exorcise the specter of treble damages.
Recent Developments in Patent Law
Citation: 8 Tex. Intell. Prop. L.J. 71 (1999)
Author: Ronald A. Antush
About: Jones Day Reavis & Pogue, Dallas, Texas. The author would like to gratefully acknowledge the contribution made to this Article by Daniel T. Conrad, another associate at Jones Day, Dallas. The views expressed in this Article are those of the author, and are not to be attributed to Jones Day, any of its partners, associates or clients, past or present.
Abstract: When the preamble states more than just the invention’s field of intended use and gives meaning to ensuing claim language, a court should construe the preamble and the remaining claim language as an unified whole that is an internally consistent recitation of the claimed invention.
It is entirely appropriate for a court to consult extrinsic evidence in order to ensure that its claim construction is not inconsistent with clearly expressed, appropriate, and widely held understandings in the relevant technical field, especially when dealing with technical terms, as opposed to non-technical terms in general usage or terms of art in claim-drafting. A patent is both a technical and a legal document. While a court is equipped to interpret legal aspects of the document, the court must also interpret the technical aspects of the document from the vantagepoint of one skilled in the art.
Literal infringement of a means-plus function claim limitation requires: (1) functional identity and (2) either structural identity or equivalence between the relevant structure in the accused device and the corresponding structure in the patent specification.
First, district courts likely will follow the Pitney Bowes guidelines concerning the proper role of extrinsic evidence, particularly expert testimony, in the context of claim construction issues. Second, prosecution history estoppel issues will receive much more attention in many current lawsuits, as accused infringers seek to capitalize on the uncertainty in the law pending an en banc decision by the Federal Circuit in Festo. That decision, once rendered, undoubtedly will affect not only pending lawsuits and appeals, but also the manner in which applications are prosecuted before the PTO. Third, while the “rules” regarding the appropriate analysis under Section 112, paragraph 6 appear to be settled, application in particular situations remains a shadowy proposition. Fourth, although the on-sale bar may seem to be more “readily” available as a defense for accused infringers, establishing the necessary proofs by clear and convincing evidence together with necessary corroboration still presents a serious challenge. Finally, the “availability” of lost profits to patentees may be somewhat diminished.
Recent Developments in Trademark Law
Citation: 8 Tex. Intell. Prop. L.J. 101 (1999)
Author: Mark T. Garrett
About: Arnold, White & Durkee, Austin, Texas.
Abstract: In the last few months, the federal courts took on issues ranging from initial interest confusion to whether a song could serve as a trademark. Along the way, the Ninth Circuit analogized the use of a competitor’s trademark as a metatag to the placement of a misleading billboard, the Fourth and Second Circuits set up a split over whether actual harm is required to make out a claim for federal dilution, the Federal Circuit may have wiped out Sears/Compco preemption, and the Supreme Court rejected Congress’ attempt to abrogate the sovereign immunity of states from charges of false advertising under the Lanham Act. Additionally, the Trademark Trial & Appeal Board (“Board”) cancelled the “Redskins” registrations because they were, in part, disparaging to Native Americans, and it stifled the King’s attempt to lock up a registration on his every likeness. Also worth noting, registrations can now be opposed and cancelled on the ground of Section 43(c) dilution.
On August 5, 1999, the Trademark Amendments Act of 1999 (“the 1999 revision”) was signed into law. The 1999 revision amended the Lanham Act to provide for the opposition and cancellation of federal registrations on the ground of Section 43(c) dilution. It also amended Sections 35(a) and 36 to include willful dilution as a basis for monetary recovery and the destruction of infringing articles. Additionally, as a result of the 1999 revision, federal immunity from infringement and dilution lawsuits no longer exists. Finally, the Act was also amended to specify that, in an action for infringement of an unregistered trade dress, the person asserting trade dress protection has the burden of proving that the trade dress is not functional.
Most of the decisions summarized in the Article demonstrate that the federal courts are capable of engaging in thoughtful and thoroughly reasoned analyses of trademark and unfair competition principles. However, these analyses are not always firmly grounded in logic, such as the Ninth Circuit’s attempt to analogize the result of using a metatag to the result of using a misleading billboard. Although the analogy is appealing at first blush, the immediacy of navigation afforded users of the information superhighway does not exist on the interstate highway and so cuts against the Ninth Circuit’s argument. Additionally, the Southern District of New York is in fairly desperate need of guidance as to the distinction between fame and distinctiveness before it takes on another dilution case. Despite these analytical shortcomings, however, the new issues that were resolved will be a little less novel the next time they are addressed, and the decisions thereon will serve to guide us on how best to protect marks, trade dress, and commercial names.
Recent Developments in Copyright Law
Citation: 8 Tex. Intell. Prop. L.J. 131 (1999)
Author: Susan B. Bruning & Catherine Fancher
About: Susan Bruning is a private practitioner and adjunct lecturer at Southern Methodist University School of Law, Dallas, Texas. Catherine Fancer is an attorney at Strasburger & Price, L.L.P., Dallas, Texas.
Abstract: This Article summarizes selected copyright cases from Volumes 50 and 51 of the Bureau of National Affairs, United States Patents Quarterly Second Series.
Issue 2 – Winter 2000
The Economic Espionage Act: Bear Trap or Mousetrap?
Citation: 8 Tex. Intell. Prop. L.J. 159 (2000)
Author: Chris Carr, Jack Morton, & Jerry Furniss
About: Mr. Carr is Assistant Professor of Business Law and Public Policy, California Polytechnic State University—San Luis Obispo. Of Counsel, Jencks Law Group, Arroyo Grande, California. Mr. Morton and Furniss are Professors of Business Law, University of Montana.
Abstract: It is not often that law professors get to write about the world of spies, espionage and trade secret theft. Yet, the Economic Espionage Act of 1996 (EEA), signed into law by President Clinton on October 11, 1996, provides such an opportunity. The EEA appeared on the public policy agenda and was passed by Congress against the following backdrop:
In 1994, the New York Daily News reported that “American business executives were stunned in 1991 when the former chief of the French intelligence service revealed that his agency had routinely spied on U.S. executives travelling abroad [and] that his agency had regularly bugged first-class seats on Air France so as to pick up conversations by traveling execs, [and] then [entered] their hotel rooms to rummage through attaché cases.” A survey released by the American Society for Industrial Security (ASIS) noted a 323% increase in economic espionage between 1992 and 1996. Different sources estimated the monetary loss to U.S. industry resulting from economic espionage activities to be between $1.8 billion to $100 billion per year. The number of jobs lost as a result of such activities was estimated to be between one million to six million.
In summary, the problem of economic espionage and the theft of corporate trade secrets had become real and severe. In Part II of this Article, we begin by addressing the primary reasons behind this increase in economic espionage and trade secret theft. Part III discusses Congress’ solution to this problem—the passage of the EEA. Part IV analyzes the 18 criminal prosecutions brought by the government to date under the EEA. Part V highlights the lessons to be gleaned from these cases. Finally, Part VI provides important compliance recommendations that prudent businesses should adopt and implement in light of these recent case developments.
Government Funded Inventions: The Bayh-Dole Act and the Hopkins v. CellPro March-in Rights Controversy
Citation: 8 Tex. Intell. Prop. L.J. 211 (2000)
Author: Tamsen Valoir, Ph.D.
About: Dr. Tamsen Valoir is an associate with the law firm of Jenkens & Gilchrist, P.C., Houston, Texas.
Abstract: This Article explores policies and procedures of the Bayh-Dole University and Small Business Patent Procedures Act (“the Act” or “the Bayh-Dole Act”), which allows for private ownership of inventions funded by the taxpayer. Government funding, while an important source of funding for research, is not without certain strings. Among some of the restrictions of the Bayh-Dole Act are march-in rights, a type of compulsory licensing; a requirement for substantial manufacture in the United States; and certain restrictions on the use of royalties. The controversy in Hopkins v. CellPro provided the circumstances for the first attempt, and failure, to employ the compulsory license provisions of the Bayh-Dole Act.
In conclusion, it is unclear how much, if any, the Bayh-Dole Act has contributed to the successful commercialization of government funded inventions. While the number of patent applications has increased dramatically, as have licensing and royalties, this growth parallels that seen in other growth industries that are generally independent of government funding. Further, there is evidence that industry partnerships may bias research results and that researchers underreport these conflicts of interest. Nonetheless, in spite of all these caveats, industry, universities, and patent lawyers alike all seem to favor the increase in university-industry partnerships created by the Act. The new industry of technology transfer was created by the Bayh-Dole Act and has provided positions for about 180,000 tech-transfer personnel. In addition, the increase in the number of patent applications certainly benefits patent lawyers.
As for the general public, it is difficult to determine if the Bayh-Dole Act brings additional inventions to the market that would otherwise not have been commercialized. Even assuming that some inventions are commercialized that would not have been otherwise, the public pays the price for the short-term monopoly given to patentees. However, in the long run, it may be that the price is right.
An Overlooked Site of Trade Secret and Other Intellectual Property Leaks: Academia
Citation: 8 Tex. Intell. Prop. L.J. 241 (2000)
Author: Ann S. Jennings, Ph.D. & Suzanne E. Tomkies
About: Dr. Ann Jennings is an Assistant Professor in the Professional Writing Program at the University of Houston-Downtown. Ms. Suzanne Tomkies is an intellectual property law attorney with offices in Houston, Texas and Rome, Italy.
Abstract: Intellectual property is critical to corporations of all sizes and can be highly significant to universities, some of which derive substantial income and other benefits from faculty inventions and writings. Unfortunately, universities, while often assisting corporations in developing intellectual property rights, can also be sites of potential leaks of those same intellectual property rights, particularly rights relating to trade secrets. Corporate clients that are now becoming involved in research arrangements with universities or sending their employees to universities for additional education may be unaware of the potential risks to their intellectual property. Intellectual property leaks in academia may be quiet and the leaks may be slow. The leaks may be made by culprits who will never be identified or by culprits who should be obvious to an alert viewer, but who are ignored. This Article is designed to help attorneys advise their clients about these potential risks.
At the root of this situation is the unique dual position that universities occupy in the United States: as incubators for students who will become the leaders of society and as incubators for ideas and products of present value to business and the military. Innovative ideas are conceived and developed by faculty at universities with the aid of student research assistants and postdoctoral fellows. The return to school of currently employed adults adds another dimension to this situation, and the appointment of students to corporate internships adds a third dimension. Finally, the presence of numerous international students adds a fourth dimension.
This Article explores each of these dimensions and provides an overview of three topics that bear on proprietary information in the academic setting: university-industry research, certain ordinary classroom activities, and competitive intelligence. This Article concentrates on activities at Texas universities, and some of the anecdotes noted below are based on actual occurrences at these universities. Certain details have been changed or omitted to prevent identification of those involved. This Article also raises certain questions. Why are universities a potential source of intellectual property misappropriation? Who are the hidden and the obvious culprits? What can universities and corporations do to safeguard their intellectual property against potential leaks by these sources? What legal recourse is available when trade secrets are misappropriated in conjunction with university-based activities? The answers to these questions may provide legal practitioners with the basis for further investigation. The answers may also serve as a warning signal: pragmatic measures can and should be taken to help prevent clients from suffering the financial losses that often accompany the theft of all types of intellectual property, particularly the loss of trade secrets.
The New Federal Cybersquatting Laws
Citation: 8 Tex. Intell. Prop. L.J. 265 (2000)
Author: Steven R. Borgman
About: Vinson & Elkins, L.L.P., Houston, Texas.
Abstract: On November 29, 1999, President Clinton signed into law an appropriations bill that included the Intellectual Property and Communications Omnibus Reform Act of 1999 (“Act”). The Act includes numerous changes to the federal patent, trademark, and copyright statutes. This Article addresses only the provisions that pertain to “cybersquatting.” The Article begins with a general discussion of cybersquatting, followed by a discussion and summary of the provisions in the Act that create new federal causes of action for cybersquatting, and the remedies provided therein.
One might easily question whether the new Section 43(d) of the Lanham Act really changes much, since the Ninth Circuit and other courts have already departed from traditional trademark law in holding against cybersquatters. The new provisions on statutory damages and in rem jurisdiction, however, seem to address issues that were not resolved by the courts. Moreover, new Section 43(d)(1) seems to extend beyond the Toeppen-style of cybersquatting to include other activities, such as registering a competitor’s mark as a domain name to divert Internet traffic. It remains to be seen just how extensively the courts will apply Section 43(d).
While the protection of individuals’ names (without regard to distinctiveness or rights of publicity) is new, the specific intent requirement and the copyrightable work exception are likely to render Section 3002(b) toothless. Interestingly, Section 3002(b) applies only to living individuals; registration of a deceased’s name remains subject only to the Lanham Act and laws regarding privacy and publicity rights. Thus, Section 3002(b) appears to add only limited protections against cybersquatting.
Although the Act provides additional causes of action and remedies against cybersquatters, the best defense for trademark owners against cybersquatters remains an aggressive policy of registering their marks as both domain names and trademarks. The cost of applying for trademark and domain name registrations is far less than the cost of litigation.
Issue 3 – Spring 2000
Do We Really Need So Many Mental and Emotional States in United States Patent Law?
Citation: 8 Tex. Intell. Prop. L.J. 279 (2000)
Author: Paul M. Janicke
About: Associate Professor of Law, University of Houston Law Center
Abstract: There has been much debate in recent years about the differences between the United States patent system and the patent systems of other countries. The most highly publicized difference involves the United States’ first-to-invent priority rule for cases involving two otherwise qualified applicants making the same claim to an invention. However, other more subtle but perhaps more significant differences, based on national cultural norms, have also been noticed by observers. The purpose of this essay is to point out how two American cultural norms, one for assessing moral culpability in civil cases, and the other for rewarding popular work-ethic traits, heavily influence the U.S. patent law system. As a result, many positive and negative mental and emotional elements are written into the U.S. patent statute and case law. The most significant of these elements will be addressed here.
It is time to look anew at the U.S. patent law system in the context of twenty-first century commercial realities. The patent system must decide whether the mental states currently present in the patent laws are helpful for a system intended to foster today’s technology, or whether in truth these mental states just make patent litigation more complicated and expensive.
Inequitable Conduct, Fraud, and Your License to Practice Before the United States Patent and Trademark Office
Citation: 8 Tex. Intell. Prop. L.J. 299 (2000)
Author: Edwin S. Flores, Ph.D. & Sanford E. Warren, Jr.
About: Dr. Flores and Mr. Warren are, respectively, associate and partner with the law firm of Gardere & Wynne, L.L.P. in Dallas, Texas.
Abstract: A practitioner’s duties to the PTO are best described by the concurrent duties that a practitioner has before various organizations responsible for ensuring that the highest standards are maintained in the legal profession. Without embarking on an over-expansive review of the myriad of ethical duties a practitioner owes to family, firm, clients, etc., we focus on the duties and ethical obligations of a practitioner before the profession.
As a general matter, inequitable conduct is raised as a defense against a charge of infringement. To prove that inequitable conduct occurred during the prosecution of a patent application, the alleged infringer must present evidence that the applicant: (1) made affirmative misrepresentations of a material fact to the patent examiner (“Examiner”); (2) failed to disclose material information; or (3) submitted false material information to the PTO. In addition, the acts or omissions before the Examiner must have been coupled with an intent to deceive.
Molins serves as a reminder of the “continuing” duty of candor a practitioner has, and the consequences of failing to uphold the highest standards in the profession. It also highlights the lack of enforcement by the PTO against practitioners found to have engaged in inequitable conduct. The few reported cases that have found a patent practitioner responsible for the act or acts of inequitable conduct have not led to the immediate dismissal of the practitioner from the Patent Bar. Rather, it is likely that these practitioners will either withdraw voluntarily from the Bar or retire.
This Article has analyzed most of the reported cases involving disciplinary actions against practitioners. Three conclusions may be reached from this analysis: first, disciplinary actions by the OED are rare; second, most disciplinary actions do not result in a reported case unless the practitioner decides to appeal the Commissioner’s decision; and third, patent practitioners who draft and prosecute patents, as well as those who defend other patent practitioners before the PTO, are subject to disciplinary actions by the PTO.
The Risks and Responsibilities of Attorneys and Firms Prosecuting Patents for Different Clients in Related Technologies
Citation: 8 Tex. Intell. Prop. L.J. 331 (2000)
Author: David Hricik
About: Mr. Hricik is a partner with the law firm of Slusser & Frost, L.L.P., Houston, Texas, and an Adjunct Professor of Law at The University of Texas School of Law. The views expressed herein are the author’s personal opinions. Neither Slusser & Frost nor its clients has had any control over the content of this Article.
Abstract: This Article analyzes the ethical and liability issues that may arise when an attorney or law firm agrees to prosecute patents in the same area of technology for more than one client at the same time.
In addition to requiring the attorney to know the intricacies of patent law as well as the details of the engineering or science involved in the application, the attorney’s agreement to represent the client in prosecuting a patent application imposes a number of duties on the attorney. The duty that will be primarily examined here is that every person substantively involved in the prosecution of a patent application has a duty to disclose to the PTO information material to the patentability of the invention claimed in that application.
This Article analyzes: (1) Whether an attorney who is aware of one client’s pending application has a duty to disclose that application to the PTO when it is material to the patentability of a second client’s application; (2) Whether the knowledge of attorneys practicing in the same firm is imputed to all attorneys in the firm for the purpose of (a) determining the existence of conflicts of interest, or (b) fulfilling the duty of disclosure to the PTO; and (3) Whether the creation of a Chinese wall or ethical screen within a firm is an effective means to (a) prevent conflicts of interest among attorneys in the same firm, or (b) preclude the likelihood that attorneys in a firm prosecuting patents for different clients in related technologies must disclose all material and confidential information known to each attorney.
Behind Closed Doors: Closing the Courtroom in Trade Secrets Cases
Citation: 8 Tex. Intell. Prop. L.J. 355 (2000)
Author: Timothy S. Durst & Cheryl L. Mann
About: Mr. Durst and Ms. Mann are, respectively, partner and associate in the Trial Department of Baker Botts L.L.P., Dallas, Texas.
Abstract: A trade secrets case can present the trade secret’s owner with a daunting paradox. The objective of trade secrets litigation is to protect the owner’s trade secrets, but the litigation process itself can threaten the secrecy that is the essence of the property right at issue. In Texas, as well as other jurisdictions, there exists a strong presumption in favor of public access to judicial proceedings. Yet, unfettered public access in trade secrets cases may result in disclosure of the secrets and possible destruction of the very property rights the lawsuit was brought to protect. This inherent tension, together with the lack of reported precedent in Texas for excluding the public from at least parts of a civil trial to prevent the disclosure of trade secrets, presents a problem for the practitioner.
This Article will explore a litigant’s unique need to protect trade secrets from public disclosure at trial, and suggest an appropriate standard in Texas for closing the courtroom to the public. The first part of the Article will explain the necessity of preventing the disclosure of trade secrets during the course of litigation. Next, the Article will explain why often-used procedures, such as protective orders and sealing court records, may not fully protect trade secrets at trial. The Article will then explore federal precedent allowing restrictions on courtroom access to protect trade secrets. Finally, the Article will suggest a standard for closing the courtroom in Texas based on federal precedent and Texas Rule of Civil Procedure 76a, which governs the sealing of court records.
Trade secrets owners should be aware that a potential by-product of trade secrets litigation is the destruction of valuable, intangible property rights. While several other protections exist to protect these property rights, closing the courtroom may be necessary when traditional protective orders and Rule 76a sealing orders will not prevent the public disclosure of trade secrets in open court. Federal law clearly allows courts to close judicial proceedings in the interest of preserving trade secrets, and, despite the lack of reported precedent in the State, Texas courts are also well equipped to handle closure requests by reference to federal precedent, Texas Rule of Evidence 507, and Texas Rule of Civil Procedure 76a. Litigants should request that courtrooms be closed to the public when necessary to protect their trade secrets because Texas courts are ready to forge this new, but certainly not uncharted, legal ground.