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SEPs, FRAND and Antitrust

Courts, patent owners, attorneys and policy makers are currently working through challenges associated with the large numbers of patents, especially in the cellular phone space and other related wireless communication, that read on portions of the industry standards necessary to implement the technology to function with products from multiple competing vendors.   Such patents are termed “standard essential” and patent owners that are members of  industry standards setting organizations are often under an obligation to license such “standard essential patents” or “SEPs” to the industry on terms that are “fair, reasonable and non-discriminatory” (“FRAND”).   Numerous issues have developed as to when a patent is properly considered an SEP, when a FRAND obligation arise, what is the appropriate FRAND royalty, and whether pooling SEPs among a group to wall off others from implementing the standard raises antitrust issues. Judge Gilstrap in the Eastern District of Texas recently considered several SEP issues in…

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Mayo v. Prometheus: 7 Years Later – Re-Establishing a Workable Solution for Patent-Eligible Subject Matter

The year was 2013.  You may remember it for the roll-out of the Affordable Care Act (a.k.a. Obama-Care) or perhaps the Boston Marathon Bombings.  For me, the latter event hit especially close to home.  I was attending law school in Boston, and earlier in the day I rode my bike to watch the Boston Marathon.  Little did I know that home-made bombs would soon shatter the lives of runners and spectators alike.  Later, I remember sitting on the couch in my apartment and hearing the omnipresent whine of sirens – the sound seemed to be coming from everywhere at once, and for good reason.  One of the perpetrators lived a few blocks from my apartment in Cambridge, Massachusetts. Being a patent attorney, I also remember 2013 for other events, although most people probably didn’t notice.  In particular, I remember 2013 for the immediate aftermath of the Supreme Court’s decision in…

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Recapping 2018—The year of Data Privacy

Last year, General Data Protection Regulation (GDPR) went into effect in the European Union (EU) regulating and protecting data from individuals within the EU.  Large US companies operating abroad were forced to update their privacy policies and procedures and have opted to broaden the changes to individuals even outside the EU.  Although GDPR has already affected companies operating in the US, there is no equivalent US federal law in place to regulate individual data. Instead, the privacy laws are enforced on a state level. California recently announced its own new privacy law, the California Consumer Privacy Act of 2018 (CCPA), that will go into effect in 2020.  Because many large companies operate in California as well as the EU, many of the practices in these regions will also extend to the remaining states.  However, the concern over data misuse on a national level continues to heighten as CEOs like Mark…

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Principal vs Supplemental Register

If you are researching potential trademarks for your business or your products, you may have come across terms such as principal register and supplemental register. To the uninitiated, these terms can be a little confusing and opaque. So, what is the difference between the two and do you have a choice when you request registration of your trademark? To begin, yes, you do have a choice; Ideally, however, you want your mark on the principal register. Generally, when discussing trademark protection, one is referring to the principal register. Marks that distinctly identify the source that the goods or services come from are placed on the principal register. Once there, these marks are given the full range of protection afforded by federal registration. The supplemental register, in contrast, is for marks that are determined to be merely descriptive and not unique. A mark that is placed on the supplemental register does…

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How Much Do You Care About Your Right-to-Repair?

The two decade old Digital Millennium Copyright Act (“DMCA”) was intended to prevent circumvention of protective measures placed on copyrighted material such as movies and music.  In the absence, or perhaps scant presence, of legislative updates, the same laws used to govern movies and music have been extended to new technologies brought by the internet age.  To keep pace with emerging technology, section 1201 of the DMCA calls for triennial proceedings to determine the types of activity that are temporarily exempt from anti-circumvention laws. The proceedings are meant, in part, to prevent overreach of the DMCA into activities that should remain fair use. At the same time, software is quickly becoming ubiquitous and more vulnerable to reverse engineering, necessitating intellectual property protection outside of trade secrecy.  The issues of increasing importance is determining what types of protection will continue to be available to copyrighted software and how “impermissible circumvention” could…

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Everyone Copied My Code!!!

Over 75% of Americans use a smartphone today according to the Pew Research Center.[1] As a result of the large number of people utilizing smartphones, smartphone operating systems and applications are being developed at an ever-increasing pace.[2] For software developers, one question that is not often considered until it is too late, is what can I do to protect my developments? One way software can be protected is through copyright. Even the largest of companies, Google Inc., could not avoid a copyright infringement suit by Oracle. While the case is ongoing, it has the potential to change the direction of copyright caselaw for software related cases. Oracle America, Inc. (“Oracle”) is the copyright owner of the JAVA operating system and development platform. Oracle sued Google, LLC, after Google copied portions of the JAVA application programming interface (“JAVA API”). More specifically, the lawsuit has resulted in a long and drawn out…

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Monkey Can Selfie But Can He Copyright?

What do whales, dolphins and porpoises have in common with a monkey of the Celebes crested macaques-type from Northern Sulawesi (Indonesia)? And how does that in turn connect with the concept of “next friend” in the context of “standing”? In fact, what is “standing”? All of these are brought together in a tale that starts in Sulawesi with a monkey named Naruto and a photographer named David John Slater, who contrived to leave his photographic equipment unattended in the hope monkeys would activate it. Seeing his opportunity, Naruto approached and took several selfies. Slater and Wildlife Personalities Ltd. (Wildlife”) published the selfies, and the rest is, as they say, history. The selfies went viral on the Internet. Slater and Wildlife claimed ownership of copyrights in the selfies. Naruto brought suit claiming copyrights as the author of the selfies. After all, it was undeniable, and Slater admitted, that Naruto pushed the…

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Disgorgement of Defendant’s Profits as Damages for Trade Secret Misappropriation, and Reduction of Damages for Accessibility by Proper Means

Analyzing the monetary harm to a business through misappropriation of one or more trade secrets is fraught with difficulty.   How much does each specific trade secret contribute to the trade secret owner’s profit on each product? How important was each trade secret to the defendant’s accused product? What was the development timeline and did the trade secret provide an “early mover” development head-start. What are the relevant market shares?   Are there commercial substitutes? Do consumers have a preference?   Is that preference a basis of demand for the product? Did the defendant sell at a higher margin than the trade secret owner and make more profit per sale that the owner of the trade secret makes?   A relatively rare remedy that addresses some of these concerns is known as “disgorgement” where a judge (not a jury) may award the trade secret owner up to the total profit earned on sales of…

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Pre-Litigation Patent Correction Procedures

So, to give your business an “edge,” you invested in a team of innovative professional engineers and scientists.  It paid off: you developed and perfected advanced technologies, as compared to your competitors. But, now they seem to have adopted your technologies to compete with you.  However, you took the precaution to obtain patent rights.  Now might be the time to exercise those rights and protect the return on your R&D investments. Before proceeding, there are a host of factors to consider, including broader business and market strategies, in addition to the “purely legal issues” posed by filing a patent lawsuit.  As to the legal issues, at the outset one is plainly “due diligence.”  This includes simply taking those steps that a reasonable, prudent businessman would take.  One of these steps is to have a person skilled at reading patent claims, a patent lawyer, take a look at the issued patents,…

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C&C Diversity News

Carstens & Cahoon continues to lead the Texas IP pack in the promotion of diversity and diversity initiatives.  Earlier this year, Carstens & Cahoon was recognized by PepsiCo Inc. as a part of PepsiCo’s outside counsel diversity initiatives for the firm’s demonstrated commitment to increasing diversity and inclusion in the legal profession at PepsiCo’s annual diversity recognition day. Law firms recognized on this day participated in PepsiCo’s diversity survey adapted from the ABA Model Diversity Survey. The survey collects diversity metrics from U.S. law firms that billed PepsiCo in the prior calendar year. PepsiCo used a weighted formula to generate a diversity index score and examined the firms’ initiatives related to diversifying the legal profession. PepsiCo recognized law firms that earned diversity index scores above the median in comparison to their peers and demonstrated an exceptional commitment to diversity and inclusion through qualitative efforts. The firm’s PepsiCo Relationship Partner, Colin…

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WHERE DID WE GO WRONG? THE IMPORTANCE OF CONDUCTING PRIOR ART SEARCHES ON A REGULAR BASIS.

Imagine your company has developed a great new product, and you have gone through the steps to protect your intellectual property in the product.  Now, a year down the road you are facing an accusation of infringement of a patent that you were not made aware of during the development of your product, but you would have found through even a short and straightforward prior art search performed by your patent attorney.                   In the fast-paced development found in industry today, it is not uncommon for products to move from development to production in a matter of days or weeks, and not the months or years of previous generations.  However, this does create some issues in the realm of intellectual property, as many of these products never have even a short and straightforward prior art search conducted to find if there are any…

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Cease and Desist Letters After TC Heartland—Best Practices

The Supreme Court recently reversed over 20 years of Federal Circuit precedent that allowed patent infringement suits to be filed anywhere that the court could exercise personal jurisdiction over the defendant.  So long as, for example, the infringing product was sold in the district, venue was proper there.  As a result of the liberal interpretation of the venue rules, the Eastern District of Texas became a popular forum for patent infringement cases, with more cases being filed there than any other district in the country. Subsequently, new decisions regarding the inconvenience of a forum required the trial court to transfer the case if it was found to be clearly more convenient for the parties for the case to be heard elsewhere.  But now, after the Supreme Court’s TC Heartland decision, a patent infringement suit can only be filed against a corporate defendant either 1) where the defendant is incorporated or…

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Clarifying the Distinction Between the “Inventive Concept” and “Patentability” Requirements When Determining Patent-Eligible Subject Matter

In the continuing wake of the U.S. Supreme Court’s attempt in Alice v. CLS Bank to define what is eligible to be the subject matter of a patent, two recent decisions have been issued by the Federal Circuit that provide an important piece of the puzzle the Supreme Court left us with more than two years ago. In the Alice decision, which held that abstract ideas merely implemented using a computer are not eligible for patent protection, the Supreme Court created an “inventive concept” requirement in its two-part test, which requires the finding that a claim either is not directed to an abstract idea, or that if it is so directed, the claims recite “something more” than what has been done conventionally. Although Congress had seemingly removed any “inventiveness” requirement from patent law decades ago, its resurrection in Alice has caused confusion as to what exactly is needed to meet…

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Who Carries the Burden in IPR—And, Does it Matter?

The Inter Partes Review (“IPR”) proceeding, part of the America Invents Act, sets up a streamlined procedure for any party (“petitioner”) to challenge the validity of the claims of an issued patent, not in a court, but in the US Patent Office, generally at a much lower cost when compared to federal court. An IPR is based on prior art patents and publications that the petitioner argues show that the claimed invention is not novel or is obvious. At the outset, in order for an IPR to be instituted, the petitioner must show a “reasonable likelihood” that it would prevail on a challenge to the validity of at least one claim of the patent. Once the petitioner meets this initial burden of proof, the inter partes “trial” of the patent claims can proceed before the Board. During the trial phase, both petitioner and patent owner can take limited depositions and…

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Interview with Hope Shimabuku of Dallas Regional Office of USPTO

Less than a year ago, the US Patent and Trademark Office (USPTO) officially opened the doors to its new Texas Regional Office in Dallas. This regional office provides outreach services for inventors and entrepreneurs in the state of Texas, as well as Alabama, Arkansas, Louisiana, Mississippi, New Mexico, Oklahoma and Tennessee. David Carstens (DC) recently had the opportunity to interview the Director of the Texas Regional USPTO, Ms. Hope Shimabuku (HS), to discuss the benefits of having a regional office so close to home. DC: Will the Texas Regional Office be hosting any open house events for patent or trademark applicants to come see where the office is located and learn more about it? HS: One of the missions of the Texas Regional Office is to provide outreach and to bring events and services to our local stakeholders. We hold workshops, trainings, conferences, roundtables, and events on a regular basis…

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Don’t Go to the Trouble of Creating a Website and then Ignoring the Trademark Infringement Lawsuit – Neutron Depot LLC v. Bankrate, Inc.

If you’ve taken the time and effort to create a website in a competitive industry and your trademark is arguably close to an industry competitor, don’t make the mistake of ignoring a subsequent trademark infringement lawsuit.  In a recent case set in the federal court for the Southern District of Texas, Insurance Depot Marking Corporation did not file an answer to Neutron Depot’s lawsuit that alleged: Trademark infringement Unfair competition Dilution Cybersquatting Neutron Depot owned the mark INSURANCE DEPOT.  Defendant Insurance Depot Marketing used the mark on its website.  Plaintiff asked for statutory damages under the Lanham Act and the Anti-Cybersquatting Consumer Protection Act based on Defendant’s use of INSURANCE DEPOT on its website that offered competing insurance services and use of the mark in website advertisements and links. Plaintiff also asked for an injunction against Defendant’s further use of the mark, an order of forfeiture or cancellation of the…

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What do you mean by “Around?” And Why the PTAB and the Courts May Disagree

While non-patent lawyers might wonder why there is such a fuss about the word “around,” the meaning of what appears to be a common term is a “big deal” in determining the scope of patent claims, and whether a patent that was subjected to the dreaded Inter Partes Review proceeding has valid claims. By way of introduction, under the America Invents Act (the “AIA”) new proceedings were instituted to test the validity of already issued patents in the Patent Office.  One of these is the Inter Partes Review (“IPR”) proceeding in which any party can challenge the validity of an issued patent by presenting prior publications (“prior art”) to show that the patent claims were invalid because they did not meet the statutory requirements of novelty, or non-obviousness. In general, the more broadly a patent claim is construed, the higher the likelihood that it will encompass prior art and be…

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How to Fight the Jabberwock Known as Alice

“Beware the Jabberwock, my son!” from Through the Looking Glass, and What Alice Found There (1871) by Lewis Carroll. Since Alice v. CLS Bank[1], companies have found that obtaining software patents is more difficult, especially as many software patent applications going through the examination process at the USPTO were drafted before the Alice decision.  Although almost anything under the sun made by man is patentable, abstract ideas are not.  Alice was the Supreme Court’s way of reinforcing that principle. Alice enforces a two-step framework first articulated in Mayo Collaborative Servs. v. Prometheus Labs., Inc.[2]: Determine whether the claim is directed to an abstract idea, natural law, or natural phenomena Examine the elements of the claim both individually and in combination to determine whether additional elements of the claim involves an “inventive concept” that “transform[s] the nature of the claim” into a patent eligible application. Under this two-step analysis, the Patent…

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Copyright: Still Relevant after 500 Years

Copyright is used to protect original works of authorship that are fixed in a tangible medium of expression.  It is a useful tool to prevent the copying of books, software, and other valuable creative and useful works.  It was developed almost 500 years ago largely in response to the invention of the printing press in 1440 by German Johannes Gutenberg.  Gutenberg was a goldsmith by profession and developed a complete printing system which allowed the precise and rapid creation of metal movable type in large quantities. The mechanization of bookmaking led to the first mass production of books in history in assembly line-style.  A single Renaissance printing press could produce 3,600 pages per workday.  Books of bestselling authors like Luther or Erasmus were sold by the hundreds of thousands in their lifetimes. The British Crown decided to censor the new industry. So in 1557 Queen Mary granted the exclusive right…

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Delay Might Put Patent Ongoing Royalties and Injunctive Relief at Increased Risk

Plaintiffs in patent cases are entitled to damages stretching back six years from the date of filing the suit for patent infringement under the Patent Statute, 35 USC § 286 — unless these were barred by laches.  This has been the law for over 20 years, since at least Aukerman,[1] which held that the defense of laches is applicable to bar past patent damages, even within the six-year statutory damages limitation period.  Laches arises when it is established that there was (1) an unreasonable delay in bringing the suit, and (2) the defendant suffered material prejudice attributable to the delay.  Aukerman did not allow a court to take into account laches when deciding prospective relief, such as an ongoing royalty or an injunction.  Now, the facts that support laches can be taken into account when a court weighs factors to decide on appropriate prospective relief. This change is premised in…

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