Who Cares About Health Care Reform? Patent Reform is Back!

EE Times reports:

Senate committee has struck a rough compromise on a controversial patent reform bill that has been stalled for several months while Congress has debated health care. A Senator leading the charge for reform suggested the compromise keeps the draft bill alive by balancing calls for lowering damages in patent infringement suits with calls for improving the quality of patents.

"Today we can report that we have reached a tentative agreement in principle that preserves the core of the compromise struck in committee last year," said Senator Patrick Leahy (D-Vt.), chairman of the Senate Judiciary Committee, speaking at an executive business meeting.

Apparently, the bill is a tweaking of the March 2009 copromise over damage apportionment.  According to Leahy, "I expect that we will be able to release details as they are finalized in the coming days, after consultation with the House."  Apparently, Director Kappos was involved in reaching the present agreement.  It's still not clear when the draft patent reform bill will come to the Senate floor for debate or, if passed, how the bill would be reconciled with one in an earlier stage in the House.

Read EE TImes, "Senator: Committee struck deal on patent reform" (link)

See transcript of statements made today by Sen Leahy at an Executive Business meeting on patent reform(link)

Reuters: "Tentative US patent reform pact reached" (link)

Tech Sector Holds Breath as IV Unloads More Patents

Today's Wall Street Journal reports:

Intellectual Ventures LLC continues to sell some of its vast patent holdings, recently selling patents to two companies that incorporated in Marshall, Texas, a favored venue for litigious patent-holding companies known as patent trolls.

WebVention LLC acquired five patents in November from Ferrara Ethereal LLC, an IV shell company. Headquartered in Marshall, WebVention is licensing one of the patents, which covers "structures and methods for organizing, presenting, and accessing information.

InMotion Imagery Technologies LLC, also of Marshall, acquired three patents that cover picture-based video-indexing technology from a different IV shell in November. 

While neither company has filed suit (yet), many people get nervous when IV sells patents, as this strategy is part and parcel of the notorious "catch and release" tactic used by patent aggregators, where patents are obtained and shopped around for a limited period of time.  After the time passes, the patents are then shopped to more aggressive holding companies for enforcement, while IV holds on to a "back-end" interest in the licensing revenue.

This appears to be part of a recent effort by IV to sell of patents for the purposes of licensing /enforcement - Webvention and other IV shell companies were covered last December by the Recorder ("What's Cooking at Intellectual Ventures?")

While InMotion does not have a website, WebVention does, and it can be viewed here (link).

See also earlier coverage of IV at the Prior Art Blog, including "Is Intellectual Ventures revving up its lawsuit machine? Will we know when it does?"

Disclosure Cut-and-Pasted From Another Patent Leads to Malpractice Claim

Cold Spring Harbor Lab v. R&G, Case No. 2:10-cv-00661(E.D.N.Y.)

This case involved the prosecution of a series of patent applications on behalf of CSHL directed to RNAi technology developed by a Dr. Hannon.  According to the plaintiff,

[R]ather than providing an original, complete description of Dr. Hannon's work, [the prosecuting attorney] instead relied upon copying extensive portions of text -- essentially verbatim -- from a prior patent application (WOI99132619) published by a team led by another researcher in the RNAi field, Dr. Andrew Fire (collectively, "Fire"), to at least, in part, describe Dr. Hannon's inventions. About one half of the "Detailed Description of Certain Preferred Embodiments" found in the three earliest filed Hannon Applications consists of text copied from the Fire application. As described below, [the prosecuting attorney] continued to rely upon this text to describe Dr. Hannon's inventions, and in particular, the shRNA technology that is the subject of the pending Hannon Applications.  By relying extensively on the copied text, [the prosecuting attorney] failed to fully describe and distinguish Dr. Hannon's inventions from the different technology invented by Fire.

During the course of prosecution, [prosecuting attorney] filed numerous follow-up continuation and continuation-in-part ("CIP") applications, allowing several opportunities to properly re-draft the Hannon Applications in such a way that relied on an original description of Dr. Hannon's own work to accurately describe the shRNA technology that Dr. Hannon invented. Instead, [prosecuting attorney] continued to rely upon the text copied from the Fire application, which falsely implied that Dr. Hannon's shRNA technology was either something that Fire invented or was suggested by the Fire application.

[Prosecuting attorney's] failure to provide an adequate description of Dr. Hannon's technology in these applications seriously compromised the ability of these applications, in particular the '557 application, to serve as priority support for Dr. Hannon's patent claims. This fact has deprived CSHL of the opportunity to obtain allowance of claims covering Dr. Hannon's inventions entitled to the respective filing dates of these applications, based on the support from these applications.

 Accordingly, the plaintiff is seeking "lost licensing opportunities for the Hannon technology, which is estimated to be worth no less than $36,500,000 to $81,500,000; and [] disgorgement of all attorneys' fees paid by CSHL to R&G since 2001, which is estimated to be no less than $1,400,000."

Read/download the complaint here (link)

Intellectual Ventures: White Hat or Black Hat?

“I guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've said"

   -- Alan Greenspan

The New York Times published the latest installment of feature pieces on Intellectual Ventures and the aspirations of Nathan Myhrvold.  While the article does not contain anything new about IV, it does bring us up-to-date on the company's recent activities and performance:

- founded in 2000, began operating in 2003;

- currently has 650 employees, estimated total value of IV = $5 billion;

- patent portfolio now over 30,000 patents;

- returned $1 billion to investors and collected more than $1 billion in license fees to date; most of the revenue has apparently come from 16 so-called strategic investors — big companies that pay to license patent rights and get a stake in an Intellectual Ventures fund;

- more than 100 deals have been done with Fortune 500 companies and their international equivalents;

- IV is allegedly linked to approximately 1,110 shell companies and affiliated entities;

- IV paid $315 million to individual inventors to date for their inventions;

- spent $1 million lobbying Congress in 2009 on patent reform; and

- in the 3 most recent election cycles, IV contributed more than $1 million to Democratic and Republican candidates and committees.

You can read the NYT article in its entirety here ("Turning Patents Into ‘Invention Capital’")(link)

What is more interesting is that the NYT article comes hot on the heels of an article that Myhrvold recently published in the Harvard Business Review, titled "The Big Idea: Funding Eureka!".  In the article, Myhrvold defends his business by arguing that the inventive process is a deeply misunderstood concept that is being (mostly) mismanaged by technology companies:

Outside the pharmaceutical and biotech industries, few companies consider inventing, or producing patented intellectual property, to be their primary mission. Corporate R&D has become mostly “D”: the development of products. Hardly any large corporations have “inventing” as a job category—even though it requires a different mind-set, has different goals, and must be managed differently than research and development positions.


[I]nvention’s stepchild status is reflected in the way it’s typically funded, which I call the charity model. The entities that provide the vast majority of research funding to U.S. universities—mostly government agencies like the National Science Foundation, the National Institutes of Health, and the Department of Defense, along with private donors—do so without any expectation of a financial return. In other words, research grants are gifts, not investments.

The shrinking handful of corporations that still fund long-range research have the same mind-set. Their leaders rarely run research as a business in its own right; instead, they fund it as an act of faith that the ideas produced will somehow create value as they percolate through the product organization.


The result of the charity mind-set is a dearth of private sector investment and an overdependence on government funding. This is undesirable on many levels. It allows federal priorities, rather than the potential market for new inventions, to determine how much funding particular areas receive. For example, the share of federal funding devoted to basic health and bioscience has steadily grown since the 1950s to about half of the total, whereas the share allocated to areas that produce a greater proportion of fruitful inventions—such as the physical and information sciences—has shrunk.

Myhrvold goes on to argue that the only way to fix this mentality is to make applied research a profitable activity that attracts vastly more private investment than it does today so that the number of inventions generated soars.  In other words, create a capital market for inventions akin to the venture capital market that supports start-ups and the private equity market that revitalizes inefficient companies:

There are always organizations and people who feel threatened by change and loudly oppose it with fearmongering and false predictions of doom. We’ve seen it before. Once upon a time, venture capitalists were called “vulture capitalists” for taking companies away from founding entrepreneurs. Early private equity firms were tarred as “barbarians” and “predators” for threatening the cozy world of inefficient corporate management. Over time both groups came to be seen as positive forces in the economy—and so will invention capitalists.
 

* * *

 
Invention is too important to leave it to charity, and I don’t see why we have to. Kleiner Perkins, Benchmark, Sequoia, and the other top venture capital firms don’t have to go to Congress and beg for a little bit more money for the small company sector. Research in areas like astronomy and fundamental physics that is very long range and has diffuse benefits for society should be funded by the government. But funding the invention of useful technology that can make money in a relatively short period of time—say, 10 years—shouldn’t be the government’s job. It’s the private sector’s job. And the U.S., with its combination of research talent, openness to financial innovation, and a culture of inventiveness, is perfectly positioned to be the nexus of this new industry.
 
What will it take for the invention capital market to come into its own? A group of companies—not just Intellectual Ventures—has to prove the concept. We have to get more people to accept our inventions. We have to vastly expand the number of companies that license our patents. And two or three invention funds need to produce great returns.
 
A functioning invention capital market and industry can enable inventors around the globe to create hundreds of thousands more inventions each year than are being made today. Sure, some of those inventions will be silly or useless. But what matters is the top 1% that will make our lives vastly richer and better. Create an invention capital market, nurture an invention capital industry, and the resulting virtuous cycle will surely transform the world.

To read the article in its entirety, click here (link)

Federal Circuit to Look at Admissibility of New Evidence for BPAI Appeals

Hyatt v. Kappos, __Fed.App.__ (Fed. Cir. 2010)(en banc)(order)

Hyatt filed for an application in the USPTO that was rejected for lack of adequate written description and lack of enablement, among other reasons. The BPAI upheld the rejections.

Hyatt appealed the rejection by filing a district court action under 35 U.S.C. § 145 against the Director.  During the district court proceedings, Hyatt tried to introduce a declaration with new descriptions to support his filed claims, but the district court denied the submission, stating that Hyatt had an “affirmative duty” or “obligation” to disclose this evidence to the PTO earlier in the process.  On appeal, the Federal Circuit upheld the district court, finding that Hyatt "could have" submitted the evidence earlier, but didn't.  As a result, the declaration was properly excluded.

In the Federal Circuit opinion, Judge Moore issued a sharp dissent on the majority opinion:

In this case, the majority blurs the line between an appeal pursuant to § 141 and the civil action of § 145. The admissibility of new evidence is exactly what distinguishes § 145 from § 141. “We must be vigilant to preserve to patent applicants the alternative procedures that the law provides, and to preserve the historical distinction between them.” Fregeau, 776 F.2d at 1041 (Newman, J., concurring-in-part). The legislative history and Supreme Court precedent make clear that the hallmark distinction is the admissibility of “all competent evidence,” “to build up a new record,” “to start de novo in court,” “and file testimony bringing in evidence that they could have brought in before [the PTO] but did not bring in before.” This evidence, admissible in this civil action, should be governed as the Supreme Court indicated by “equity practice and procedure,” i.e., the Federal Rules of Evidence and Civil Procedure.

Since only the presence of new evidence invokes the de novo standard of review (otherwise the district court will give the Board fact findings substantial evidence deference, see Fregeau, 776 F.2d at 1038), the majority’s decision in this case makes the § 145 action virtually indistinguishable from an appeal under § 141. This version of a “civil action” under § 145 is contrary to Congressional intent and to the Supreme Court’s rulings. While it is sound policy to encourage full disclosure to administrative tribunals such as the PTO, we are not the body that makes the decision of how best to do this. Congress held numerous hearings over this legislation, considered the concerns over permitting a civil action, and decided to enact the legislation despite these concerns.

A request for rehearing en banc was filed, and was granted yesterday by Federal Circuit (link).  The requested the parties to file new briefs addressing at least the following issues:

The parties are requested to file new briefs addressing at least the following issues:

(a) Are there any limitations on the admissibility of evidence in section 145 proceedings? In particular -
     (i) Does the Administrative Procedure Act require review on the agency record in proceedings pursuant to section 145?

     (ii) Does section 145 provide for a de novo proceeding in the district court?

     (iii) If section 145 does not provide for a de novo proceeding in the district court, what limitations exist on the presentation of new evidence before the district court?

(b) Did the district court properly exclude the Hyatt declaration?

The Federal Circuit also indicated that  "Briefs of amici curiae will be entertained, and any such amicus briefs may be filed without leave of court but otherwise must comply with Federal Rule of Appellate Procedure 29 and Federal Circuit Rule 29."

The Companies Most Pursued by NPEs

PatentFreedom has identified and profiled over 315 distinct NPEs and claims that, since 1985, these NPEs have been involved in litigation with nearly 4,500 different operating companies in over 3,100 distinct actions. Furthermore, nearly 75% of the suits between these NPEs and operating companies were filed since 2003.

PatentFreedom has tabulated the lawsuits between 2004-09 to determine the "most pursued" companies by NPEs:

(1)  Apple - 56 NPE Lawsuits
(2)  Sony - 55 NPE Lawsuits
(3)  Dell - 50 NPE Lawsuits
(4)  Microsoft - 49 NPE Lawsuits
(5)  HP - 48 NPE Lawsuits
(6)  Samsung - 48 NPE Lawsuits
(7)  Motorola - 46 NPE Lawsuits
(8)  AT&T - 44 NPE Lawsuits
(9)  Nokia - 42 NPE Lawsuits
(10)  Panasonic - 40 NPE Lawsuits
(11)  LG - 39 NPE Lawsuits
(12)  Verizon - 37 NPE Lawsuits
(13)  Toshiba - 36 NPE Lawsuits
(14)  Sprint Nextel - 34 NPE Lawsuits
(15)  Google - 33 NPE Lawsuits
(16)  Acer - 31 NPE Lawsuits
(17)  Time Warner - 31 NPE Lawsuits
(18)  Deutsche Telekom - 29 NPE Lawsuits
(19)  Kyocera - 28 NPE Lawsuits
(20)  Palm - 28 NPE Lawsuits
(21)  Cisco - 27 NPE Lawsuits
(22)  Fujitsu - 25 NPE Lawsuits
(23)  IBM - 25 NPE Lawsuits
(24)  Intel - 24 NPE Lawsuits
(25)  RIM - 24 NPE Lawsuits
(26)  HTC - 24 NPE Lawsuits

Interestingly, a number of these companies actually experied a decline in lawsuits compared to 2008:

Microsoft - 23% decline (10 cases in 2009, vs. 13 cases in 2008)
Samsung - 45% decline (6 cases in 2009, vs. 11 cases in 2008)
Motorola - 64% decline (9 cases in 2009, vs. 14 cases in 2008)
AT&T - 30% decline (7 cases in 2009, vs. 10 cases in 2008)
Palm - 40% decline (6 cases in 2009, vs. 10 cases in 2008)
RIM - 55% decline (5 cases in 2009, vs. 11 cases in 2008)
HTC -  40% decline (6 cases in 2009, vs. 10 cases in 2008)

According to PatentFreedom, NPE lawsuits dropped from 500 cases, to just over 450 cases in the last year.
 
Nevertheless, others companies experienced a significant increase in lawsuits over the previous year:

Apple - 62% increase (21 cases in 2009, vs. 13 cases in 2008)
Sony - 42% increase (17 cases in 2009, vs. 12 cases in 2008)
Dell - 113% increase (17 cases in 2009, vs. 8 cases in 2008)
Panasonic - 120% increase (11 cases in 2009, vs. 5 cases in 2008)
Toshiba - 60% increase (8 cases in 2009, vs. 5 cases in 2008)
IBM - 350% increase (9 cases in 2009, vs. 2 cases in 2008)

Regarding the most litigious NPE's (since 2003), Patent Freedom ranks them this way:

Acacia Technologies - 337 cases
Rates Technology Inc - 139 cases
Ronald A Katz Technology Licensing - 129 cases
Millennium LP - 110 cases
Plutus IP - 77 cases
Sorensen Research and Development Trust - 73 cases
General Patent Corp International - 72 cases
Cygnus Telecommunications Technology LLC - 69 cases
Papst Licensing GmbH - 62 cases
F&G Research Inc - 56 cases

To read more information on this topic, see PatentFreedom:'s website:

"Most Pursued Companies" (link)
"Litigations Over Time" (link)
"Most Litigious" NPE's (link)
"Largest Patent Holdings" (NPE) (link)
"Product Categorization" (link)

See also Joff Wild's take at the IAM blog: "Apple is the number one target for NPEs in the US" (link)

Patentee's Failure to Cite Prior Art Leads to Inequitable Conduct on Summary Judgment

Sabasta v. Buckaroos, Inc., No. 4:06-cv-180 (S.D. Iowa, February 3, 2010)

Sabasta sued Buckaroos on a patent relating to roll-bending dies used to make saddles for pipe insulation.   Just prior to filing the patent, Sabasta discovered that specially-fabricated dies used in conjunction with a "two roll-bending machine" could efficiently produce pipe saddles of interest.  Based on this discovery, Sabasta purchased an "Acrotech Model 1618" and worked with Acrotech to fabricate specially designed dies.  These dies were ultimately the subject of Sabasta's patent.

During prosecution of the patent application, the original claims were rejected based on other prior art, but the Examiner indicated that certain dependent claims "would be allowable if rewritten in independent form."  These dependent claims recited features related to the Acrotech machine.  Neither the Acrotech machine, nor the related manuals, were cited to the USPTO.  Sabasta incorporated these features in a subsequent amendment, which ultimately led to the allowance of the application.  When the amendments were made, the applicant remarked:

Examiner has indicated in [] the Office Action that the prior art of record fails to teach or adequately suggest the claimed features of claim 6 together with the base claim and any intervening claims. Therefore, claim 1, by virtue of its incorporation of the limitations of claim 6 and any intervening claims, is believed to be allowable.

Defendant argued that the “Acrotech machine and manual are directly inconsistent with and refute the position taken by Sabasta in overcoming the Examiner’s prior art rejections. . . . Sabasta explicitly amended his pending claims to add the limitation which required that cam followers engage the die [and] relied on this as the critical distinction to overcome prior art rejections.”

The district court agreed with Buckaroos:

[T]he Plaintiff relied on the mounting portion/cam roller limitation to overcome the Patent Examiner’s rejection of the as-submitted claims. To overcome the Patent Examiner’s rejections, Plaintiff explicitly stated that it believed the independent claims to be allowable based on the incorporation of the formerly dependent claim limitation providing that the die comprise “a pair of mounting portions” that extend from the opposite ends of the die and that are designed to engage cam rollers on a roll-bending machine for purposes of maintaining the die’s alignment. . . . After receiving this amendment, the Patent Examiner subsequently approved Plaintiff’s patent application. Given these facts, the Court has no doubt that prior art teaching a die that comprises mounting portions to engage preexisting cam rollers on a two-rollbending machine would be considered by a reasonable patent examiner to be important in a determination of whether to allow an application to issue as a patent.

On the issue of intent, the court added:

[I]n the present case, an inference of intent is supported not simply by the lack of a credible good faith explanation for the nondisclosure, but also by independent evidence of a far more substantial factual basis, namely that Plaintiff actually made an argument in favor of patentability that contained, as the primary distinguishing element, a feature that was not disclosed in any of the prior art before the examiner and that was readily apparent in the undisclosed Acrotech machine and manual. As Defendant correctly emphasizes, Plaintiff  “went beyond merely silently failing to disclose the Acrotech machine and manual as a general reference”; rather, he “affirmatively made misrepresentations by failing to disclose the closest, highly material reference which went to the critical point of patentability [i.e., the mounting portion/cam roller limitation] which Sabasta relied upon to obtain the ‘995 Patent.”

The Federal Circuit has squarely held that “a trial court may infer deceptive intent based on a showing that a patentee withheld references with which it was intimately familiar and which were inconsistent with its own patentability arguments to the PTO.” Agfa Corp., 451 F.3d at 1378. That is precisely the case in the present matter. It is undisputed on the record that Plaintiff was fully aware of the Acrotech machine and manual, and that Plaintiff was well acquainted with the features of the Acrotech machine, including those of the Standard OD Attachment. . . .

[T]he record likewise demonstrates that Plaintiff relied specifically on the addition of the mounting portion/cam roller recitation to overcome the Patent Examiner’s rejection of Independent Claims 1 and 15 . . . Coupled with the fact that Plaintiff designed the die of the ‘995 Patent to be used, specifically, in conjunction with the Acrotech 1618 Machine, these factors provide strong support for a conclusion that Plaintiff knew or should have known that the Acrotech machine and manual were material not only to his assertion that the mounting portion/cam roller limitation would make patentability “allowable,” but also to the general prosecution of his patent application. Finally, it is apparent on the record that Plaintiff did not disclose the Acrotech machine or manual to the USPTO, despite knowledge of both the prior art and its materiality.

Read/download a copy of the opinion here (link)

Source: DocketNavigator

Lucent v. Gateway Dooms Another Damages Award at the CAFC

ResQNet.com, Inc. v. Lansa, Inc., No. 08-1365 (Fed. Cir., February 5, 2010)

Lansa appealed an award of damages for patent infringement from the Southern District of New York, arguing that the evidence and expert testimony relating to damages was erroneous, leading to an inflated 12.5% royalty rate on patents relating to screen recognition and terminal emulation technologies.

The first Georgia-Pacific factor requires considering past and present royalties received by the patentee “for the licensing of the patent in suit, proving or tending to prove an established royalty.”  In this case, ResQNet's expert (Dr. David) based his damages on seven ResQNet licenses, two of which were based on litigation , and five of which were “re-bundling licenses” that furnished finished software products and source code, as well as services such as training, maintenance, marketing, and upgrades, to other software companies in exchange for ongoing revenue-based royalties.  These companies obtained the right to re-brand ResQNet’s products before resale or bundle these products into broader software suites.

The Federal Circuit stated

[N]one of [the re-bundling] licenses even mentioned the patents in suit or showed any other discernible link to the claimed technology. Dr. David tabulated an average of the royalty ranges specified in these agreements, a number substantially higher than 12.5%.

The rates in the re-bundling licenses are not consistent at all with the other two licenses in the record. Those two “straight” licenses arose out of litigation over the patents in suit. One of them was a lump-sum payment of stock which Dr. David was unable to analogize to a running royalty rate. The other was an ongoing rate averaging substantially less than 12.5% of revenues . . . The inescapable conclusion is that Dr. David used unrelated licenses on marketing and other services—licenses that had a rate nearly eight times greater than the straight license on the claimed technology in some cases—to push the royalty up into double figures.

This court finds two parts of this analysis particularly troubling: first, the extremely high rates in the re-bundling licenses compared with the license on the claimed technology, and second, the unconvincing reasons that Dr. David gave for considering these re-bundling licenses at all. On this second point, the trial transcript indicates several instances where Dr. David misunderstood (or worse, misrepresented) the re-bundling licenses as somehow amounting to “patent plus software” licenses when, in fact, the record shows no use in these licenses of ResQNet’s claimed invention.

[T]hus, the district court in this case made the same legal error that this court corrected in Lucent. This trial court, like the one in Lucent, made no effort to link certain licenses to the infringed patent. For his part, Dr. David did not provide any link between the re-bundling licenses and the first factor of the Georgia-Pacific analysis. Without that link, as this court explained in Lucent: “We . . . cannot understand how the [fact finder] could have adequately evaluated the probative value of [the] agreements.” 580 F.3d at 1328.

The Federal Circuit also added:

The district court seems to have been heavily influenced by Lansa’s decision to offer no expert testimony to counter Dr. David’s opinion. But it was ResQNet’s burden, not Lansa’s, to persuade the court with legally sufficient evidence regarding an appropriate reasonable royalty. See Lucent, 580 F.3d at 1329 (“Lucent had the burden to prove that the licenses were sufficiently comparable to support the lump-sum damages award.”). As a matter of simple procedure, Lansa had no obligation to rebut until ResQNet met its burden with reliable and sufficient evidence. This court should not sustain a royalty award based on inapposite licenses simply because Lansa did not proffer an expert to rebut Dr. David.

Judge Newman, Dissenting-In-Part:

My colleagues, in setting strict barriers as to what evidence can be considered, leave the damages analysis without access to relevant information. However, it is not necessary that the identical situation existed in past transactions, for the trier of fact to determine the value of the injury . . . Lansa presented no testimony and proffered no evidence. Although Lansa waived the position on which my colleagues rely, this court fills the gap. For example, my colleagues do not discuss the district court’s reasoning, but state that they find “particularly troubling” that some of the licenses in evidence had “extremely high rates [when] compared with the [litigation-induced] license on the claimed technology.” The district court fully considered this aspect, and factored it into a competent overall analysis in which no flaw has been shown. The court’s conclusion warrants affirmance.

 Read/download the opinion here (link)

WIPO Reports 4.5% Drop in PCT Filings For 2009

WIPO reported today that, despite the economic turmoil in 2009, PCT applications experienced a mere 4.5% drop for the year - provisional data indicates that 155,900 applications were filed in 2009 as compared to the nearly 164,000 applications filed in 2008.

The U.S. continues to be a top user of PCT applications, filing just under a third of all international applications in 2009.  The top 10 filers include:

(1)  United States -- 45,790 applications
(2)  Japan -- 29,827 applications
(3)  Germany -- 16,736 applications
(4)  Republic of Korea -- 8,066 applications
(5)  China -- 7,946 applications
(6)  France -- 7,166 applications
(7)  United Kingdom -- 5,320 applications
(8)  The Netherlands -- 4,471 applications
(9)  Switzerland -- 3,688 applications
(10)  Sweden -- 3,667 applications

While these rankings have remained somewhat consistent over the years, the recent economic turmoil appears to have hit different countries in different ways.  Specifically, filings from Western industrialized countries experienced significant drops:

Israel: -17.2%
Canada: -11.7%
U.S.A.: -11.4%
Sweden: -11.3%
Australia: -7.5%
Italy: -5.8%
United Kingdom: -3.5%
Finland: -2.2%

In contrast, international patent filings in a number of East Asian countries continued to enjoy positive growth:

China: +29.7%
Japan: +3.6%
Republic of Korea: +2.1%

Declines and advances in PCT filings also varied by technology area. The greatest declines related to computer technology (12,560 applications, down 10.6% on 2008); pharmaceuticals (12,200 applications, down 8.0% on 2008) and medical technology (12,091 applications, down 5.9% on 2008). The largest growth rates were experienced in micro-structural and nano-technology (+10.2%), semiconductors (+10%) and thermal processes and apparatus (+ 7.2%).


-- Read WIPO's press release and report, "International Patent Filings Dip in 2009 amid Global Economic Downturn" (link)

D. Del: Only Pre-Litigation Conduct Admitted for Willfulness, Despite Prliminary Injunction and CAFC Affirmance

Cordis Corporation v. Boston Scientific, et al., 1-03-cv-00027 (DED January 28, 2010, Memorandum Order)

In the litigation, the court made a preliminary finding of infringement against defendants, which was affirmed on appeal. The accused devices were not taken off the market, however, and the case proceeded to trial based on the court's finding, upon a more developed record, that genuine issues of material fact precluded entry of a summary judgment as to infringement. A jury ultimately determined that certain Boston Scientific products infringed Cordis' patents.

Cordis moved for willful infringement, and requested that the earlier court findings be enteresd as evidence of willfulness.  The court denied the motion:

It cannot be emphasized enough that the litigation process is a complicated one, comprising multiple steps and moved forward by multiple decisions, ranging from resolving a discovery dispute to a case-dispositive motion. Consequently, I am very uncomfortable with characterizing administrative and court decisions as "objective evidence" for presentation to a jury. As recognized by counsel, a jury is going to give such evidence great weight, even when the procedural and substantive bases for most such decisions will not be apparent to the jury. This strikes me either as the kind of evidence better suited for review by a court or as eliciting the kind of hindsight review that is so strenuously discouraged in other aspects of patent law. See KSR Intern. Co. v. Teleflex Inc., 550 U.S. 398,421 (2007). Therefore, consistent with the reasoning of the Seagate decision as a whole (and its emphasis on prelitigation conduct), generally only evidence regarding the prelitigation landscape of the dispute will be admitted.

Download a copy of the opinion here (link)

Source: Docket Navigator

Here Comes the Hike: 15% Increase in Fees Proposed by USPTO

From the Wall Street Jornal:

Inventors and companies would face a new 15% surcharge on patent fees under the Obama administration's proposed budget, with the funds going to help the U.S. Patent and Trademark Office to "improve the speed and quality of patent examinations."


The head of the patent office floated the surcharge proposal late last year. The proposal would require congressional approval.

The funds would allow the administration to hire more examiners and upgrade technology under the Patent and Trademark Office's proposed $2.3 billion budget for fiscal year 2011.

[O]verall, the Commerce Department's proposed $8.9 billion budget would represent a 36% decrease from fiscal year 2010. Last year's budget was higher than usual because of billions of dollars set aside to hold the 2010 Census.

Nice.

Read: "Surcharge Seen on Patent Fees " (link)

See also, Reuters, "U.S. patent office gets boost in Obama budget" (link)