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If the Supreme Court justices are looking for questions to ask during the Arthrex oral argument, here are some options:

1. The USPTO has new PTAB judges take a judicial oath.

The judicial oath is grounded in 28 U.S.C. §453:

§ 453.Oaths of justices and judges

Each justice or judge of the United States shall take the following oath or affirmation before performing the duties of his office: “I, ___ ___, do solemnly swear (or affirm) that I will administer justice without respect to persons, and do equal right to the poor and to the rich, and that I will faithfully and impartially discharge and perform all the duties incumbent upon me as ___ under the Constitution and laws of the United States. So help me God.”

28 U.S.C. §453.

The Federal Circuit has implied that the patent eligibility guidance of the USPTO (now required to be followed by PTAB judges) might sometimes contradict Federal Circuit case law. See, e.g., cxLOYALTY, INC. v. MARITZ HOLDINGS INC., No. 2020-1307 (Fed. Cir. Feb. 8, 2021) at footnote 1.

Is it the Government’s position that PTAB judges will violate their judicial oaths in order to follow PTO guidance of the Director, e.g., the patent eligibility guidance, rather than enforce the common law of the Federal Circuit out of fear of losing their judgeships? If the answer is “no”, is such guidance really a controlling factor on APJ behavior? If a Director’s guidance is merely parroting the law, how is that guidance considered controlling when a PTAB judge has taken an oath/affirmation to follow the law? If the PTO requires its judges, under oath, to faithfully and impartially discharge their duties under the Constitution and laws of the United States, how could it expect the judges to subordinate their own interpretation of the law to the viewpoint of the Director?

2. What should the Court make of footnote 6 in Brenner v. Manson? Footnote 6 of Brenner v. Manson makes a comment about whether the then-Commissioner of the USPTO was bound by determinations of the Board of Patent Appeals and Interferences.  The footnote reads:

[6] We find no warrant for this curious limitation either in the statutory language or in the legislative history of § 1256. Nor do we find persuasive the circumstance that the Commissioner may not appeal adverse decisions of the Board of Appeals. 35 U. S. C. §§ 141, 142, and 145 (1964 ed.). As a member of the Board and the official responsible for selecting the membership of its panels, 35 U. S. C. § 7 (1964 ed.), the Commissioner may be appropriately considered as bound by Board determinations. No such consideration operates to prevent his seeking review of adverse decisions rendered by the CCPA.

See this earlier post for more information from the oral argument of that case: [Link].

3.  In Knowles Electronics LLC v. Iancu, 886 F.3d 1369 (Fed. Cir. 2018)(then-captioned Knowles Electronics LLC v. Matal) — before the Arthrex issue had been tee’d up and in a brief that was disinterested in the Arthrex issue — the Government explained how the Director is the representative of the agency, i.e., the USPTO; but, the PTAB is the USPTO’s adjudicator. The Director can ask the PTAB to reconsider a decision. But, when the PTAB makes a decision, it is in reality an order of the agency itself. If the Director disagrees with a PTAB decision, he/she is free to challenge that decision at the Federal Circuit.

C. The USPTO’s statutory authority allows it to choose whether to intervene and, if so, what position to take

Because Article III of the Constitution “poses no bar” to the USPTO’s participation in an appeal from a USPTO decision, see Ingalls, 519 U.S. at 264, we next address the USPTO’s statutory authority to intervene and the extent of that authority. By statute, the Director of the USPTO has a right to intervene in every inter partes case arising from the USPTO. And the Director has statutory authority to take any position in those cases.

Before Congress passed the America Invents Act (AIA) in 2011, the Patent Act stated, “In an ex parte case or any reexamination case, the Director shall submit to the court in writing the grounds for the decision of the Patent and Trademark Office, addressing all the issues involved in the appeal.” 35 U.S.C. § 143 (2002) (emphasis added). Thus, before the AIA, the USPTO was, by statute, a party to every appeal from an inter partes reexamination. The AIA amended that sentence, removing “any reexamination case” from the category of appeals in which the agency was obligated to appear. 35 U.S.C. § 143 (2012).

Instead, Congress added a sentence addressing the agency’s authority to intervene, at its discretion, in appeals from inter partes cases, including inter partes reexaminations. The new sentence states, “The Director shall have the right to intervene in an appeal from a decision entered by the Patent Trial and Appeal Board . . . in an inter partes or post-grant review under chapter 31 or 32.” 35 U.S.C. § 143 (2012). Although that sentence does not specifically mention inter partes reexaminations, which were being phased out by the AIA, Congress explained elsewhere in the Act that “the Director’s right under the fourth sentence of section 143”—the sentence just quoted—“to intervene in an appeal from a decision entered by the Patent Trial and Appeal Board shall be deemed to extend to inter partes reexaminations.” AIA, Pub. L. No. 112-29 § 7(e)(4), 125 Stat. 284, 315 (2011); see also 157 Cong. Rec. S1377 (daily ed. Mar. 8, 2011) (statement of Sen. Kyl) (“In the effective-date provision at the end of section [7], various existing [appeal] authorities are extended so that they may continue to apply to inter partes reexaminations commenced under the old system.”); see also Joseph Matal, Legislative History of the America Invents Act: Part II of II, 21 FED. CIR. B.J. 539, 542 n.25 (2012).

Furthermore, the Director’s right to intervene in inter partes reexaminations extends to those reexaminations “that are requested . . . before the effective date” of the AIA. Pub. L. No. 112-29 § 7(e)(4), 125 Stat. 284, 315. In other words, the change in the law was made applicable to all inter partes reexaminations that were requested before the AIA came into effect. Thus, the USPTO’s participation in appeals from inter partes reexaminations went from an obligation to a right, even for inter partes reexaminations that were already pending.

The statute thus spells out the situations in which the Director has the right to intervene, which include inter partes reexaminations, inter partes reviews, and other inter partes cases in the USPTO. This Court therefore routinely asks the USPTO if it plans to intervene in inter partes cases, particularly in cases like this one where the Court would otherwise lose the benefit of the adversarial process. The statute also clearly specifies the cases in which the Director is automatically a party—ex parte cases. 35 U.S.C. § 143 (2012).

The statute does not discuss or limit the positions the Director may take in any type of case. In ex parte cases, the statute merely specifies that the Director must “address[ ] all of the issues raised in the appeal,” 35 U.S.C. § 143 (2012); in inter partes cases, even that requirement does not exist. Although the Director typically intervenes on the side of the appellee, even in that posture, the Director may take any substantive position he likes.2

Indeed, Ingalls directly addresses the Director’s position in these appeals, not as a representative of the Board but as a representative of the agency as a whole. When the Board—the USPTO’s adjudicator—makes a decision, the “order of the agency’s designated adjudicator is in reality an order of the agency itself.” 519 U.S. at 268. The agency “may then be free to designate its enforcer/litigator as its voice before the courts of appeals.” Id. The agency’s litigator—in this case the USPTO Solicitor—while appearing on the side of the appellee, “is free to argue on behalf of the petitioner and to challenge the decision of the Board.” Id. at 270. Thus, if the Director (or Solicitor) disagrees with the Board’s decision, he need not argue in support of affirmance.This prevents “a ‘lopsided’ scheme whereby the Director can appear only in defense of the [Board’s] decisions.” Id. (citations omitted).3

In practice, the USPTO Director typically intervenes in appeals from inter partes cases in only two particular types of situations. Recognizing that the two parties can adequately represent the adverse sides of the dispute if both are present but not when the appellee has dropped out of the case, the Director will often intervene when the appellee has dropped out to preserve the adversarial presentation of the issues and to support the agency’s decision. Other than that, the Director often intervenes when the dispute on appeal implicates broader USPTO or government interests. Those interests may involve the validity or interpretation of federal statutes, of the USPTO’s procedures, or of USPTO regulations. So, for example, if an appellant argues that a regulation that the Board followed is contrary to the Patent Act, the Director may intervene to support the regulation. Although the Director could choose to intervene, under the statute, in every inter partes case, he instead selects cases in which his participation would be most important to the agency and helpful to the Court.

The Director’s presence is not required, however, for the appeal to proceed. As discussed above, the appellant has a justiciable controversy because it stands to lose its patent. The lack of USPTO participation does not moot the appellant’s case any more than does the reexamination requester’s declining to participate, discussed above.

In the unlikely event that the government were to decline to defend the Board’s decision in a case in which no other party was defending it, the Court could simply decide to hear the patentee’s appeal without the benefit of an adverse party. Alternatively, the Court could appoint or invite an amicus to defend the Board’s decision. The Supreme Court, for example, often chooses that route when the government confesses error and declines to defend a favorable decision from a lower tribunal. See, e.g., Becker v. Montgomery, 532 U.S. 757, 762 n.1 (2001) (“Without any party to defend the Sixth Circuit’s position, we invited [attorney] Stewart A. Baker to brief and argue this case, as amicus curiae, in support of the judgment below. His able representation . . . permit[s] us to decide this case[,] satisfied that the relevant issues have been fully aired.” (citations omitted)). Or, if the government confesses error and the Court concludes that, in consequence, there is nothing substantial remaining to be decided, the Court may simply vacate and remand. See Lawrence on Behalf of Lawrence v. Chater, 516 U.S. 163, 169-73 (1996); Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744 (1985) (“If the record before the agency does not support the agency action, if the agency has not considered all relevant factors, or if the reviewing court simply cannot evaluate the challenged agency action on the basis of the record before it, the proper course, except in rare circumstances, is to remand to the agency for additional investigation or explanation.”).

Regardless, because the USPTO typically intervenes to defend the Board’s decision and tries to avoid situations in which a Board decision that it disagrees with is heard on appeal, the situation rarely arises. Far more common, and preferable, is a situation like this, in which the USPTO Director chooses to intervene to support the Board’s decision.

Footnotes:

2 Because the USPTO does not have independent litigating authority, the Director seeks and obtains authorization from the Solicitor General before intervening in this Court. See generally 28 U.S.C. § 516; 28 C.F.R. § 0.20(c)

3 Practically speaking, the Solicitor would not often argue in support of reversal of a Board decision because the agency would likely handle those cases administratively. For example, the Director can ask the Board to reconsider a decision. If the decision has already been appealed and the Director then determines that it is somehow defective, the Solicitor can seek a remand for the Board to reconsider. See, e.g., In re Bursey, No. 2016-2675 (Fed. Cir. Apr. 28, 2017) (nonprecedential) (remanding appeal upon Solicitor’s request to allow Board to reconsider); In re DiStefano, 562 Fed. App’x 984 (Fed. Cir. June 4, 2014); In re Shield, No. 2013-1562 (Fed. Cir. Apr. 16, 2014); In re Motorola Mobility LLC, No. 2012-1470 (Fed. Cir. Mar. 5, 2013).

DOJ/USPTO’s Supplemental Brief filed July 31, 2017 in Knowles Electronics LLC v. Iancu, 886 F.3d 1369 (Fed. Cir. 2018)(then-captioned Knowles Electronics LLC v. Matal).

The entire brief is available here: [Link].

4. Back in 1992, 75% of the judges on the Board of Patent Appeals and Interferences sent a memo to the Commissioner of Patents and Trademarks.  The memo objected to instances in which the composition of panels of the Board had been manipulated or re-constituted.

We wish to express our concern regarding matters that carry disturbing implications of which you may not be aware.  There are an increasing number of instances in which the composition of panels of the Board of Patent Appeals and Interferences (BPAI) has been manipulated in a manner which interferes with the decisional independence of the Board and gives the appearance that a predetermined or predecided outcome has been reached in cases appealed under 35 USC §134.

Recently, for example, a randomly selected three member panel, acting pursuant to its statutory authority, reached and signed a decision, favorable to the appellant in Application Serial No. ***.  The issues in this application involved matters requiring special knowledge of *** technology and case law. The three member panel assigned to decide the appeal was constituted of individuals having this special knowledge.

For reasons unknown to us, the Chairman of the BPAI prevented the mailing of that decision.  He subsequently convened a special panel formed only of management officials, namely the Commissioner, the Deputy Commissioner, the Assistant Commissioner for Trademarks, the Chairman and the Vice-Chairman of the BPAI.  All of the original panel members were replaced.  To our knowledge, none of the new panel members has any special expertise or knowledge in *** technology or case law.  The management panel rendered a decision opposite in result to that reached by the legally constituted original panel, making no mention of the earlier decision.  These circumstances reflected an appearance of impropriety, e.g., an appellant being denied procedural due process within the U.S. Patent and Trademark Office.

It is the function of the BPAI to interpret case law of reviewing courts of the United States Patent and Trademark Office and apply this case law in reaching decisions on appeals.  It is the function of either the Court of Appeals for the Federal Circuit or the District Court of the District of Columbia to review the decisions of the BPAI.  There is no statutory authorization for any individual or individuals other than the above-noted Courts for reviewing decisions of the BPAI.

Interference with the decision making process of any agency’s authorized appellate board of review has at least the appearance of being improper.  Compare 5 USC §554.

While we have referenced only a single appeal in which we believe impropriety may have occurred, there is a disturbing pattern of interference with the normal course of deciding appeals by this BPAI, either by special selection of panels or by oral threats to panel members that they will be removed from a panel if they decide “the wrong way.”

The Commissioner is authorized under 35 USC §7 to “designate” the members of a panel.  There is no apparent authority, statutory or otherwise, to un-designate a duly formed panel and to redesignate a completely new panel for any purpose, let alone the purpose of reaching a conclusion opposite to that of the original panel, after the original panel not only reached a decision, but signed that decision.

These matters raise questions of a very serious nature including ultra vires agency action, interference with the judicial independence of the BPAI and denial of an appellant’s right to procedural due process.

We respectfully submit this memorandum to apprise you of these matters and to formally disavow even the appearance that we condone them.

If the proposed revision to the statute is adopted by the Court in Arthrex to make Administrative Patent Judges at-will employees, does the Government believe that it will be able to recruit high quality candidates to the role of Administrative Patent Judge when it is clear that judicial independence is important to most administrative judges?

5. How is the threat of losing one’s job an ability to control the outcome of a case already decided by a PTAB panel?

6. During the oral argument of Oil States, the Government led the Court to believe that panel stacking at the USPTO during IPR’s had taken place on only three occasions. Does the Government wish to update that statement?

 In the oral argument of Nidec v. Zhongshan, the then-Solicitor for the USPTO, who once served as the acting Chief Judge of the PTAB, commented that over the years panels of the Board have been expanded “many, many times.”

You can listen to the sound bite from Nidec here: [Listen].  Or, you can find it at the 25 min 40 second mark of the oral argument in Nidec Motor Corp. v. ZHONGSHAN BROAD OCEAN MOTOR, 868 F.3d 1013 (Fed. Cir. 2017), available at: [Link].   Or, you can review the exchange from Nidec below:

Judge Reyna: What kind of uniformity or certainty do we have in that where the PTAB can look at a prior decision and say well we don’t like that, let’s jump back in there and change that?

PTO: Well, ….

Judge Wallach: How does the Director choose which judge to assign to expand the panel?

PTO: Uh, that’s provided, your Honor, by our standard operating procedure. And, the Chief Judge actually makes that decision.And, the judges are selected based on their technical and legal competency. And, over the years, many many panels at the Board have been expanded. In fact if you looked at the thirty . . . .

Judge Reyna: Are they selected on whether they’re going to rule in a certain way?

PTO: Uh, well, people can be placed on the panel . . . for example, the Director can place him or herself on the panel, and certainly the Director knows how they’re going to rule. Nidec has not said and they say at their blue brief at page 43 that they don’t challenge the independence of these judges on this panel. Um, these judges were not selected and told to make a particular decision. If judges could be told to make a particular decision, there would be no need to expand a panel in the first place.

See this previous post indicating that expanded panels were used on at least five occasions in 2017 alone: [Link].

7. If PTAB judges are required to meet certain legal and technical qualifications in order to qualify as APJ’s, are similar qualifications required of the representatives of the USPTO’s Solicitor’s Office? If the Solicitor’s Office/Director is entitled to pick and choose which parts of a PTAB decision it wants to defend on appeal to the Federal Circuit, shouldn’t the members of the Solicitor’s Office at least meet the same qualifications required of PTAB judges? Is Congress’ intent of using highly qualified APJ’s to adjudicate IPR’s being carried out if people not meeting those same qualifications are entitled to pick and choose which parts of a PTAB decision to defend on appeal?

If PTAB judges are required to submit financial data to ensure impartiality, does the same requirement apply to other members of the Office who are free to take a position opposite to the PTAB’s position on appeal?

8. If the USPTO Solicitor’s Office were ever to refuse to defend a PTAB decision, could the PTAB represent itself?  See Justice Scalia’s dissenting opinion in Ingalls at 273 (“The second argument offered in support of the view that the Director is a proper respondent when review is sought of an order of the Board is that (1) Rule 15(a) requires the naming of someone representing the agency, and (2) the Director is certainly a more sensible candidate than the Board. Ante, at 267, 268. The second part of this analysis, the faute de mieux point, is questionable: The Board could readily develop a staff to defend its judgments, and it is hard to imagine a worse defender than an entity that is free to disagree (and often does disagree) with the order under review.”).

9. If APJ’s are determined to be improperly appointed principal officers and there is no cure to the statute, must the previous actions of the PTAB with respect to IPR’s be rendered arbitrary and capricious as not issued in accordance with the law in view of 5 U.S.C. § 706(2)(A)?

10. If APJ’s are determined to be improperly appointed principal officers and there is no cure to the statute, are previous invalidations of patents in IPR’s administrative takings?

11. If it is determined that PTAB judges are not principal officers and they are not currently being overseen by a principal officer — because Director Iancu has resigned his post — should forthcoming PTAB decisions be considered valid, until a new Director/principal officer is confirmed by the Senate? After all, some argue that PTAB judges are inferior officers because a Director purportedly supervises them and a Director is a principal officer. What about when there is no Director/principal officer to supervise the PTAB judges? Does the Vacancies Act provide a cure? If so, how does the Vacancies Act — merely a statutory measure — suspend a constitutional requirement that a principal officer be appointed with the advice and consent of the Senate?

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Update 3/10/21:

12. How will a recusal by the Director affect an IPR? Is the action taken by the USPTO in the IPR valid if there is no principal officer supervising the IPR due to the recusal by the Director?

Duke University recently held a conference on the US v. Arthrex appeal to the Supreme Court. I missed the live conference; but, they were nice enough to put it up on YouTube. You can view the YouTube video below:

From my preliminary viewing of the video, it appears that Professor Duffy has the most persuasive position on the first panel. But, watch it and judge for yourself.

In the second panel, Professor Walker at 1:27:04 seems to have his fingers on the pulse of patent owners.

This might be an appropriate time for the constituents of Texas’s US Senators and House members to point out to those elected officials that the Federal Circuit found this patent claim patent ineligible:

12. A method of detecting events on an interconnected electric power grid in real time over a wide area and automatically analyzing the events on the interconnected electric power grid, the method comprising:

receiving a plurality of data streams, each of the data streams comprising sub-second, time stamped synchronized phasor measurements wherein the measurements in each stream are collected in real time at geographically distinct points over the wide area of the interconnected electric power grid, the wide area comprising at least two elements from among control areas, transmission companies, utilities, regional reliability coordinators, and reliability jurisdictions;

receiving data from other power system data sources, the other power system data sources comprising at least one of transmission maps, power plant locations, EMS/SCADA systems;

receiving data from a plurality of non-grid data sources;

1352*1352 detecting and analyzing events in realtime from the plurality of data streams from the wide area based on at least one of limits, sensitivities and rates of change for one or more measurements from the data streams and dynamic stability metrics derived from analysis of the measurements from the data streams including at least one of frequency instability, voltages, power flows, phase angles, damping, and oscillation modes, derived from the phasor measurements and the other power system data sources in which the metrics are indicative of events, grid stress, and/or grid instability, over the wide area;

displaying the event analysis results and diagnoses of events and associated ones of the metrics from different categories of data and the derived metrics in visuals, tables, charts, or combinations thereof, the data comprising at least one of monitoring data, tracking data, historical data, prediction data, and summary data;

displaying concurrent visualization of measurements from the data streams and the dynamic stability metrics directed to the wide area of the interconnected electric power grid;

accumulating and updating the measurements from the data streams and the dynamic stability metrics, grid data, and non-grid data in real time as to wide area and local area portions of the interconnected electric power grid; and

deriving a composite indicator of reliability that is an indicator of power grid vulnerability and is derived from a combination of one or more real time measurements or computations of measurements from the data streams and the dynamic stability metrics covering the wide area as well as non-power grid data received from the non-grid data source.

Electric Power Group, LLC v. ALSTOM SA, 830 F.3d 1350 (Fed. Cir. 2016).

Strikes me that one might want to incentivize the development of these types of claims/systems via the patent system.

The Federal Circuit sat en banc last Thursday in Arellano v. Tran, an appeal from the US Court of Appeals for Veterans Claims (an Article I court).

The Federal Circuit took this appeal en banc sua sponte (not as my autocorrect would like to spell it: “sea sponge“)

The questions presented are:

A. Does the rebuttable presumption of the availability of equitable tolling articulated in Irwin v. Department of Veterans Affairs, 498 U.S. 89, 111 S.Ct. 453, 112 L.Ed.2d 435 (1990), apply to 38 U.S.C. § 5110(b)(1), and if so, is it necessary for the court to overrule Andrews v. Principi, 351 F.3d 1134 (Fed. Cir. 2003)?

B. Assuming Irwin‘s rebuttable presumption applies to § 5110(b)(1), has that presumption been rebutted?

C. Assuming this court holds that Irwin‘s rebuttable presumption applies to § 5110(b)(1), would such a holding extend to any additional provisions of § 5110, including but not limited to § 5110(a)(1)?

D. To what extent have courts ruled on the availability of equitable tolling under statutes in other benefits programs that include timing provisions similar to § 5110?

You can listen to the en banc oral argument here:

[Link].

There’s an interesting line in today’s opinion in Keynetik v. Samsung.

The word “set” can mean “[a]n assemblage of distinct entities, either individually specified or which satisfy certain specified conditions.” Set, Oxford English Dictionary, https://www.oed.com/view/Entry/176794 (last visited Jan. 26, 2021). A “set” need not consist of multiple things and may consist of nothing, i.e., an “empty set.” Id.3

Keynetik, Inc. v. Samsung Electronics Co., Ltd., 2020-1271, (Fed. Cir. Jan. 27, 2021) (slip. op. at pages 8-9.

Think of the implications of the word “set” including the “empty set” for purposes of claim construction in patent law. How many issued claims does that line of thinking broaden by reducing claim elements within those issued claims to include a nullity? How many claims does it invalidate for 112 or 102/103 purposes? I fear Judge Dyk has relapsed to a Texas Digital perspective on this one and is relying too heavily on dictionary definitions, again.

The DOJ as well as Smith and Nephew have filed their reply briefs at the Supreme Court in the pending Supreme Court appeal of United States v. Arthrex. Oral argument is scheduled for March 1, 2021.

You can review the reply briefs here:

DOJ Reply Brief: [Link].

Smith and Nephew Reply Brief: [Link].

Name the state that permits administrative law judges to conduct marriage ceremonies.

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Assuming the hypothetical situation that PTAB judges are not principal officers and they are not currently being overseen by a principal officer — because Director Iancu has resigned his post — should forthcoming PTAB decisions be considered valid, until a new Director/principal officer is confirmed by the Senate? After all, some argue that PTAB judges are inferior officers because a Director purportedly supervises them and a Director is a principal officer. What about when there is no Director/principal officer to supervise the PTAB judges? You might recall that there was an extended vacancy in the USPTO Director position between the terms of David Kappos and Michele Lee.

The oral argument of the day comes from the recent appeal to the Federal Circuit in In re Sorensen. This was an appeal of a §101 rejection in ex parte prosecution.

The claim at issue is pretty long. Claim 1 recites:

1.  A system for analyzing shopper behavior within a store, the system comprising:

a sensor system configured to:

            for each of a plurality of a first group of shopper trips in the store,

                        detect a wireless signal for a shopper proxy device adjacent an entrance to the store;

                        detect a wireless signal for the shopper proxy device adjacent an exit of the store;

a data analyzer computing device configured to:

            determine a trip length for each shopper based on a time between the detected presence of the detected wireless signal at the entrance and the detected presence of the detected wireless signal at the exit of the store;

            determine a total number of shopper trips by multiplying a number of the detected wireless signals by a calibration factor, the calibration factor determined based on image data of the entrance and exit captured by one or more cameras, and the calibration factor relating a number of actual shoppers observed in the image data during a calibration period;

            calculate a first relationship that is a distribution of the determined trip lengths over the number of shopper trips and trip length; 

            determine an average trip length based on the distribution of the first relationship;

            for each of a plurality of a second group of shopper trips in the store,

                        receive transaction data for a plurality of purchase transactions at the store, and transaction data for a plurality of items, the transaction data for the plurality of purchase transactions including a number of items purchased for each purchase transaction;

                        calculate a second relationship that is a distribution of items purchased in the purchase transactions over the shopper trips;

                        determine an average number of items purchased based on the distribution of the second relationship;

wherein the sensor system is further configured to:

            detect current wireless signals in the store; and

wherein the data analyzer computing device is further configured to:

            determine a current total number of shoppers in the store by multiplying the detected current wireless signals by the calibration factor;

            determine a number of items to be purchased by the current number of shoppers by multiplying the average number of items purchased by the current total number of shoppers;

wherein the system further comprises an alert device to signal for deploying an in-store service, the alert device being configured to signal that the in-store service be deployed in response to one or both of:

            the data analyzer computing device determining that the total number of shoppers exceeds a first predetermined threshold, in which case the alert device is configured to signal for deploying the in-store service after a predetermined period of time following detection that the current number of shoppers exceeds the first predetermined threshold, the predetermined period of time being equal in duration to the average trip length, and

            the data analyzer computing device estimating that the number of items to be purchased by the current total number of shoppers exceeds a second predetermined threshold, in which case the alert device is configured to signal for deploying the in-store service after the predetermined period of time following detection that the number of items to be purchased by the current total number of shoppers exceeds the second predetermined threshold.

The claim is also reproduced in the opinion by the PTAB here:

If you were curious how this claim compares to the claim in Electric Power Group, the claim in Electric Power Group had 395 words while the claim above has 535 words.

As you’ll see from the PTAB decision, the only issue on appeal was 35 U.S.C. §101. Apparently, a §103 rejection had been made during prosecution and was later withdrawn by the examiner.

The Federal Circuit panel was comprised of Judges Newman, O’Malley, and Taranto.

Judge O’Malley first asked if the Office’s position was that any application directed to organizing human activity would be unpatentable:

Judge Newman had a couple of interesting sound bites during the oral argument. My sense from her comments is that she would like to see the Office provide more citations of references when making §101 rejections.

You can listen to the entire oral argument here:

In today’s opinion in Mortgage Application Technologies, LLC v. MeridianLink, Inc., the Federal Circuit used the word “forwent” in the opinion.

Query: How many times has the word “forwent” been used in prior Federal Circuit or CCPA opinions? Answer below the break.

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On Friday, the Supreme Court granted a petition for certiorari in Minerva Surgical, Inc. v. Hologic, Inc. The case concerns assignor estoppel.

You can listen to the oral argument from the Federal Circuit case here:

You can read the Federal Circuit opinion here: [Link].

You can read the briefs to the Supreme Court here: [Link].

Mark your calendars. The Supreme Court has set the oral argument in United States v. Arthrex, Inc. for March 1, 2021.

If anyone is looking for an article to write, I think a very good topic would be a survey of the psychological research (psychology research??) on hindsight bias. Moreover, a discussion of how the psychological research on hindsight has been applied in other legal settings would be useful. I suspect the bulk of the research focuses on how witnesses to accidents remember or misremember the details of an accident. But, it would still be interesting to see what that research teaches us. Hindsight is bandied about quite often when arguing about obviousness; but, isn’t it time to update our understanding of the principles of hindsight so that we can try to eliminate hindsight bias in the minds of those examining applications . . . as well as those adjudicating patents? I don’t ever remember reading a Federal Circuit or CCPA decision that cites a scientific journal on the factors that identify or suggest a hindsight bias.

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Update 1/9/21:

Many thanks to Professor Karshtedt of GW Law for pointing me in the direction of some great resources on this topic. First, in In re Cyclobenzaprine Hydrochloride, 676 F.3d 1063 (Fed. Cir. 2012), the Federal Circuit points to some journal articles on hindsight bias, including a recent law review article by Professor Gregory Mandel [Link]:

Finally, not only is Stratoflex the law, it is sound in requiring that a fact finder consider the objective evidence before reaching an obviousness determination. The objective considerations, when considered with the balance of the obviousness evidence in the record, guard as a check against hindsight bias. Graham, 383 U.S. at 36, 86 S.Ct. 684 (quoting Monroe Auto Equip. Co. v. Heckethorn Mfg. & Supply Co., 332 F.2d 406, 412 (6th Cir.1964)). In Graham, the Court recognized the danger of hindsight bias and the ameliorative effect that the objective considerations might offer. In discussing the utility of the objective considerations, the Court cited a law review note published after the nonobviousness requirement was enacted in the 1952 Patent Act. Id. at 18, 86 S.Ct. 684 (citing Richard L. Robbins, Subtests of “Nonobviousness”: A Nontechnical Approach to Patent Validity, 112 U. Pa. L.Rev. 1169 (1964) (“Robbins”)). In that note, the author argued that the instruments of decision-making applied in patent cases at the time were inadequate and allowed judges to rely on “judicial hunches,” thereby deciding cases on extralegal grounds. Robbins, 112 U. Pa. L.Rev. at 1170 & n.11 (citing Joseph C. Hutcheson, Jr., The Judgment Intuitive: The Function of the “Hunch” in Judicial Decisions, 14 Cornell L.Q. 274, 278 (1929)). Such “judicial hunches” are encouraged by hindsight bias. As one commentator recently observed, “decision-makers unconsciously let knowledge of the invention bias their conclusion concerning whether the invention was obvious in the first instance.” Gregory N. Mandel, Patently Non-Obvious: Empirical Demonstration that the Hindsight Bias Renders Patent Decisions Irrational, 67 Ohio St. L.J. 1391, 1393 (2006). In other words, knowing that the inventor succeeded in making the patented invention, a fact finder might develop a hunch that the claimed invention was obvious, and then construct a selective version of the facts that confirms that hunch. This is precisely why the Supreme Court explained that objective considerations might prevent a fact finder from falling into such a trap, observing that objective considerations might serve to “resist the temptation to read into the prior art the teachings of the invention in issue.” 383 U.S. at 36, 86 S.Ct. 684.^[6] And, it is precisely why fact finders must withhold judgment on an obviousness challenge until it considers all relevant evidence, including that relating to the objective considerations.

In re Cyclobenzaprine Hydrochloride, 676 F.3d 1063, 1079 (Fed. Cir. 2012)

Second, the Fifth Circuit even more recently noted some research in regard to hindsight in the case of Lisa M. v. LEANDER INDEPENDENT SCHOOL DIST., 924 F.3d 205 (5th Cir. 2019):

While judicial review unavoidably looks backward, our task is to assess eligibility with the information available to the ARD committee at the time of its decision. An erroneous conclusion that a student is ineligible for special education does not somehow become acceptable because a student subsequently succeeds. Nor does a proper finding that a student is ineligible become erroneous because the student later struggles. Subsequent events do not determine ex ante reasonableness in the eligibility context.

We are not alone in this approach. The Ninth Circuit has held that review of a school district’s eligibility determination should be assessed “at the time of the child’s evaluation and not from the perspective of a later time with the benefit of hindsight.” L.J. by & through Hudson v. Pittsburg Unified Sch. Dist., 850 F.3d 996, 1004 (9th Cir. 2017). As L.J. put it, “We judge the eligibility decision on the basis of whether it took the relevant information into account, not on whether or not it worked.” Id.

Our sister circuits are split on whether courts can consider hindsight evidence in a different context—when assessing the appropriateness of an IEP. Compare R.E. v. New York City Dep’t of Educ., 694 F.3d 167, 187 (2d Cir. 2012) (disallowing use of “evidence that [a] child did not make progress under the IEP in order to show that [the IEP] was deficient from the outset”); with M.S. ex rel. Simchick v. Fairfax County Sch. Board, 553 F.3d 315, 327 (4th Cir. 2009) (“[W]e have concluded that, in some situations, evidence of actual progress may be relevant to a determination of whether a challenged IEP was reasonably calculated to confer some educational benefit.”); see also Dennis Fan, No IDEA What the Future Holds: The Retrospective Evidence Dilemma, 114 Colum. L. Rev. 1503 (2014) (describing various circuit positions); Maggie Wittlin, Hindsight Evidence, 116 Colum. L. Rev. 1323, 1386-88 (2016) (same).

Lisa M. v. LEANDER INDEPENDENT SCHOOL DIST., 924 F.3d 205, 214 (5th Cir. 2019).

The link to the article by Professor Maggie Wittlin, including a discussion of debiasing, is available [here].

The amicus briefs in support of Arthrex were filed recently. You can review them here:

	Amicus brief of Pacific Legal Foundation submitted.
	Amicus brief of 39 AGGRIEVED INVENTORS submitted.
	Amicus brief of B.E. Technology, LLC submitted.
	Amicus brief of Joshua J. Malone submitted.
	Amicus brief of U.S. Lumber Coalition submitted.
	Amicus brief of Americans for Prosperity Foundation and TechFreedom submitted.
	Amicus brief of TiVo Corporation submitted.
	Amicus brief of US Inventor, Inc. submitted.
	Amicus brief of Jeremy C. Doerre submitted.
	Amicus brief of Cato Institute submitted.
	Amicus brief of New Civil Liberties Alliance submitted.
	Amicus brief of Fair Inventing Fund submitted.

I thought these statistics from TiVo’s brief were interesting:

1. TiVo’s experience presents a particularly striking example of the abusive purposes for which the inter partes review regime can be employed. TiVo’s (and its subsidiaries’) patents have been the subject of well over one hundred inter partes review petitions since November 2016. Thirty-seven patents have been challenged—an average of 3.35 petitions per patent. In total, only about 5% of the challenged claims have survived. Many of these claims had been previously upheld against validity challenges by the International Trade Commission—a body made up of properly appointed principal officers. 

In effect, inter partes reviews have allowed TiVo’s competitors to violate its patent rights and then, after having been adjudged guilty of that conduct in one adjudicatory forum (for example, the ITC), obtain a second bite at the apple via one or more inter partes review petitions. Even worse, after the first proceeding has exposed flaws in the infringer’s invalidity arguments, the infringer can use those proceedings as a roadmap to attempt to fix those flaws in the subsequent inter partes review. In effect, the first proceeding functions as a practice run for the infringer to test out its invalidity case and assess the weaknesses in it so it may avoid those weaknesses when it challenges the patent before the Board. 

To take one illustrative example, Rovi, a TiVo subsidiary, asserted U.S. Patent Nos. 9,369,741 and 7,779,011 (among other patents) against Comcast Cable Communications in Certain Digital Video Receivers and Related Hardware and Software Components, Inv. No. 337-TA-1103 (U.S.I.T.C.). In the course of that proceeding, Comcast tried and failed to show that the claims of the ’741 patent were invalid in light of a prior-art reference called Sie. See Initial Determination on Violation of Section 337 and Recommended Determination on Remedy and Bond (Public) at 257–60 (June 27, 2019). Comcast also tried and failed to show that the claims of the ’011 patent were invalid as obvious over two prior-art references called Gross and Smith. See id. at 101–13. While the ITC investigation was ongoing, Comcast filed multiple inter partes reviews against the ’741 and ’011 patents. Using the Commission proceedings as a roadmap, Comcast ultimately succeeded in convincing the Board to invalidate those two patents based on the very same prior art that the ITC had already considered. Specifically, the PTAB concluded that the ’741 patent was obvious over Sie, see Comcast Cable Commc’ns, LLC v. Rovi Guides, Inc., No. IPR2019-00231, Paper 44 (P.T.A.B. May 8, 2020), and that the ’011 patent was obvious over Gross and Smith, see Comcast Cable Commc’ns, LLC v. Rovi Guides, Inc., No. IPR2019-00239, Paper 50 (P.T.A.B. June 30, 2020).3   

This is not how the system is supposed to work. Patent owners should be entitled to some measure of repose. They should not be subjected to repeated attacks on the validity of their patents throughout their twenty-year term. The perpetual cloud of uncertainty that results from this system undermines the presumption of validity and harms incentives to innovate. It also flatly contradicts the original intent of the drafters of the AIA, who made clear that the new post-grant proceedings established by that statute were “not to be used as tools for harassment or a means to prevent market entry through repeated litigation and administrative attacks on the validity of a patent.” H.R. Rep. No. 112-98, pt. 1, at 48 (2011). 

2. TiVo, unfortunately, is not an outlier with regard to its experience with the inter partes review system. According to TiVo’s research, for patents that have survived a validity challenge in district court or the ITC and are also challenged before the Board, the Board institutes inter partes review at a rate of 58% and cancels claims upon which review was instituted at a rate of 63%. These numbers are only marginally lower than the corresponding rates for all challenged patents, which are 66% and 75%, respectively. In other words, patents that have survived an expensive validity challenge in district court or the ITC are almost as likely to be reviewed—and ultimately invalidated—by the Board as a patent that was never the subject of litigation. It is little wonder that accused infringers use inter partes reviews to gain a second bite at the invalidity apple. 

Amicus brief of TiVo Corporation at pages 6-9, footnotes omitted.

If anyone is looking for a short article topic, they might want to look at Judge Taranto’s recent opinion for the Federal Circuit in ADAPTIVE STREAMING INC. v. NETFLIX, INC., No. 2020-1310 (Fed. Cir. Dec. 14, 2020) and compare it to Judge Lourie’s opinion for the Federal Circuit in Atmel Corp. v. Information Storage Devices, Inc., 198 F.3d 1374 (Fed. Cir. 1999).

In Adaptive Streaming, the Federal Circuit takes into account material incorporated by reference in a patent specification to assess patent eligibility:

The written description, through material incorporated by reference, itself explains the familiarity of translation of content—from a format (including a language) of a sender to one suited to a recipient—as a fundamental communication practice in both the electronic and pre-electronic worlds. J.A. 337-38. We have held that the ideas of encoding and decoding image data and of converting formats, including when data is received from one medium and sent along through another, are by themselves abstract ideas, and accordingly concluded that claims focused on those general ideas governing basic communication practices, not on any more specific purported advance in implementation, were directed to abstract ideas.

ADAPTIVE STREAMING INC. v. NETFLIX, INC., No. 2020-1310 (Fed. Cir. Dec. 14, 2020)(slip. opinion at page 6).

In Atmel, however, the Federal Circuit noted that material incorporated by reference (from a non-patent document), could not be relied upon for §112,¶6 purposes:

Section 112, ¶ 6, however, does not have the expansive purpose of ¶ 1. It sets forth a simple requirement, a quid pro quo, in order to utilize a generic means expression. All one needs to do in order to obtain the benefit of that claiming device is to recite some structure corresponding to the means in the specification, as the statute states, so that one can readily ascertain what the claim means and comply with the particularity requirement of ¶ 2. The requirement of specific structure in § 112, ¶ 6 thus does not raise the specter of an unending disclosure of what everyone in the field knows that such a requirement in § 112, ¶ 1 would entail. If our interpretation of the statute results in a slight amount of additional written description appearing in patent specifications compared with total omission of structure, that is the trade-off necessitated by an applicant’s use of the statute’s permissive generic means term.

Atmel argues that even though the text of the Dickson article is not in the specification, sufficient structure is nevertheless disclosed in the specification, and that the district court erred in limiting possible structures corresponding to the high-voltage generating means to those structures included in the Dickson article. While we do agree with ISD that the district court properly held that the Dickson article may not take the place of structure that does not appear in the specification, the specification plainly states that “[k]nown Circuit techniques are used to implement high-voltage circuit 34. See On-Chip High Voltage Generation in NMOS Integrated Circuits Using an Improved Voltage Multiplier Technique, IEEE Journal of Solid State Circuits . . . .” ‘811 patent, col. 4, ll. 58-62. Atmel’s expert, Callahan, testified that this title alone was sufficient to indicate to one skilled in the art the precise structure of the means recited in the specification. The record indicates that that testimony was essentially unrebutted. That being the case, we conclude that summary judgment was improperly granted invalidating the ‘811 patent for indefiniteness under § 112, ¶ 2. We therefore reverse the grant of summary judgment of invalidity and remand for further consideration of other issues consistent with this opinion.

Atmel Corp. v. Information Storage Devices, Inc., 198 F.3d 1374, 1382 (Fed. Cir. 1999)

Query: In what other cases has the Federal Circuit looked to material incorporated by reference when making §101 determinations?