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Tropic Ocean Airways: Don’t Draft your Complaint on the Beach

When a lawsuit is filed, a plaintiff must provide the factual and legal basis for the claims to avoid the case being dismissed.  How much detail must be provided was arguably changed significantly by a pair of U.S. Supreme court decisions, Twombly and Iqbal, decided in 2007 and 2009, respectively.  Before these two cases, the courts often repeated the rule that “a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.”  In Twombly, the Supreme Court retired this rule.  The Court reiterated the requirement of Rule 8, which requires only a “short and plain statement of the claim showing the pleader is entitled to relief.”  However, the Court went on to explain that while the complaint need not recite detailed factual allegations, the…

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The Movement Toward a Federal Trade Secret Protection Law

With the recent attention by the U.S. Congress and the U.S. Supreme Court to patent issues, the value of the IP protected as a trade secret may not be receiving the attention it deserves.  Various studies have suggested that the value of IP protected as a “trade secret” (such as the recipe for Coke) greatly exceeds the value of IP protected by patents.  Importantly, the protection afforded a trade secret lasts forever (or at least as long as the trade secret remains confidential); whereas the length of protection for a utility patent is generally 20 years from the earliest effective filing date for patent applications filed on or after June 8, 1995. While patents are governed by a single federal statutory framework at 35 U.S.C. § 101, et seq., including exclusive jurisdiction in the federal district courts for infringement disputes and most other matters related to patents, with all appeals…

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You’ve Worked Hard to Develop Your Brand, But Is Your Investment Protected?

Don’t let someone else steal your brand.  Imagine this: you’ve worked hard for about 10 years to develop your brand and name recognition.  After years putting in sweat equity, your business is finally starting to take off.  It might even be time to expand to a neighboring state.  There’s only one problem.  A couple from a neighboring state started up a similar business with a similar name about three years ago. Neither you nor the other couple were aware of each other.  Now that you’re ready to expand, you decide you should get a federal trademark registration for your business.  You’ve heard that the federal registration can give you nationwide protection for your mark.  In other words, you can get protection not just for your state, but for the entire United States.  Unfortunately, there are some exceptions, for example, if a competitor uses the mark in good faith in a…

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Alice Corp. and an “Abstract Idea”

In the recent Alice Corp. v. CLS opinion, the Supreme Court described a two-part “framework,” for making such a distinction between patents that claim the building blocks of human ingenuity and those that integrate the blocks into something more: Determine whether the claim(s) at issue are directed to a patent-ineligible concept, (is it an abstract idea?) and if so Examine the elements of the claim(s) at issue, individually and as an ordered combination, to determine whether the claim contains additional features or an inventive concept sufficient to transform the nature of the claim into a patent-eligible application. The problem with respect to prong no. 1 of the framework is the opinion does not define the “abstract idea” element.  The only guidance provided in the opinion is that where a patent claim is deemed to cover a long prevalent, fundamental economic practice it is considered as being directed to an abstract idea.  How one should determine…

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IP Trends We’ll Be Following in the Coming Year

As we transition in to a new year, we re-focus our efforts in certain trends in the area of intellectual property law.  Four trends are briefly discussed below. Data Privacy and Protection Big Data Growth and Use Post-Grant Patent Review via IPR Patent Subject Matter Eligibility after Alice Corp. v. CLS Bank  Data Privacy and Protection Recent thefts of celebrity images (including nude images) bring to the forefront of national attention the issue of data privacy and protection.   Since many of the images appeared to have been taken using mobile devices and stored in cloud-based databases, the reliability of security in these environments has been brought into question.  Other recent thefts have involved credit card data from major banks (Citibank, JP Morgan), major retailers (Target, Home Depot, Neiman Marcus), and credit card processors (Global Payments, Heartland Payment Systems).  These data breaches involved millions of credit and debit card accounts.  However,…

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Patent Eligibility after Alice v. CLS Bank

The U.S. Supreme Court recently issued its decision in Alice v. CLS Bank regarding the patentability of computer-implemented financial and other business methods.  The Court held that patents that attempt to claim simply an “abstract idea” implemented on a general purpose computer are not valid.  Although this is not actually a change in the law, it is a clarification of this evolving area of patent law.  And based on the sudden harsh treatment of computer-implemented method patent claims by both the Patent Office and the courts, combined with the current lack of guidance given to patent examiners for examining such claims, patent owners should not only address the claims of their currently pending applications, but they should also strongly consider revisiting their granted patents in this area for possibly reissuing those patents with revised claims in order to preempt potential challenges to their patents under the Alice decision.

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Should We be Watching for the New “Trade Dress” in the Fall Fashion Shows?

Not really.  Trademark law encompasses the subpart known as “trade dress.” When an average consumer can identify the source of a good or service by its look and feel, then this may be its trade dress.  The design or configuration of a product, the labeling and packaging of goods, and the décor or environment where services are provided can all be protected as trade dress.  Trade dress features must be distinctive and not functional. Examples include the shape of a Coca-Cola bottle, the red color on the sole of a Christian Louboutin pump, or the image of a horse-mounted polo player on a bottle of cologne, duffle bag, or shirt from Ralph Lauren.  Each of these examples are not functional to the item, but are distinctive in how they identify the source of the goods. When a company’s trade dress has achieved distinctiveness and is nonfunctional, it should be protected…

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Abstract Ideas – Are they Patentable?

Recently, the USPTO issued a memorandum to its Examiner Corps, entitled “Preliminary Examination Instructions in view of the Supreme Court Decision in Alice Corporation Pty. Ltd. v. CLS Bank International, et al.” At its core, the memo addressed subject matter eligibility of claims involving abstract ideas, particularly computer-implemented abstract ideas. Comments were submitted by AIPLA and IPO (two leading IP bar associations). The memo and the comments recognized the Alice decision did change substantive patent eligibility law or fundamental examination guidance.  However, the comments emphasized that Alice did not create a per se excluded category of business methods or software, or impose any special requirements for eligibility of business methods or software. The premise of the guidance is that abstract ideas are fundamental building blocks of human ingenuity and are not patentable—inventors must use those building blocks to construct their innovations. Examiners are tasked with evaluating whether (1) the claim is “directed to” an abstract…

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Copyright Law

The Transmit Clause gives copyright holders the exclusive right to transmit or otherwise perform a copyrighted work to the public by means of a device or process.

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Alice Decision

The Supreme Court affirmed the Federal Circuit’s decision in Alice Corporation v. CLS Bank holding that patents directed to schemes or methods of mitigating settlement risks in the exchange of financial obligations between two parties claimed unpatentable subject matter.  Although the patents recited system claims implementing the method on a computer system, the Supreme Court held that merely reciting a generic computer in the claims does not make an otherwise abstract idea patent eligible.  The decision re-affirms long-standing Supreme Court precedent with respect to the un-patentability of abstract ideas and reiterates the importance of drafting the patent application on such methods in a way that takes the claimed subject matter out of the abstract idea category and puts it into the implementation category.  Without an adequate disclosure of a specialized implementation, the patent application may be rejected by the patent office and, even if the application is granted, any patent obtained…

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An “Exceptional Case” Need Not Be so Very Exceptional Anymore

In a patent suit involving a patent covering an elliptical trainer exercise machine, the US Supreme Court significantly changed a long-established standard for awarding attorney fees to the prevailing party.  Under the old standard, the trial court had the discretion to order the losing party to pay the prevailing party’s attorney fees if it found that the case was “exceptional.”  A case was regarded as “exceptional” if it was “objectively baseless and brought in subjective bad faith.”  This is a tough standard to meet.  The Supreme Court has now lowered the bar so that an “exceptional case” is one that either “stands out from others” with regard to the party’s litigation position (considering the law and the facts of the case), or is litigated in an unreasonable manner.  The Supreme Court instructed that the trial court should look at the totality of the circumstances, and that there were no fixed…

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Limelight: 9-0 Supreme Court Reversal

There was a brief glimmer of hope for those patents with claims covering steps performed by more than one entity. But once again the Supreme Court has chastised the Federal Circuit for not following its prior precedent.  Specifically, there can be no active inducement of infringement unless there is first direct infringement, and direct infringement does not exist if more than one entity is performing the steps. This case illustrates the importance of drafting claims that are directed to single actor and thinking about how infringers might try to design around the claims by having a third party perform one or more of the claimed steps. Review LimelightYellowCopy for the Supreme Court’s opinion.      

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Cybersquatting and Trademark Complaints Must Provide Factual Support under Iqbal/Twombly

The Southern District of Florida recently dismissed a cybersquatting case we had on behalf of one of our clients. The judge agreed with our argument that the mark was merely descriptive and that no facts were alleged to support secondary meaning in the one year period between plaintiff’s first use of the mark and our client’s registration of the domain name. So while dismissals at the pleading stage are rare, it is important to consider in all cases whether a motion to dismiss is appropriate, especially after the U.S. Supreme Court’s decisions in Iqbal and Twombly requiring that plaintiffs provide factual support rather than just mere conclusory statements. Click here for a link to the Court’s order of dismissal.

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There You Go Again – Infringing my Patent!

Have you ever taken someone to court, based on ongoing offending activities of that person, won the case, and then found he/she was once again engaging in “the same” offensive activity?  If so, you are probably aware that a Court Order is enforceable through a “Contempt Action” to prevent the person from engaging in the activity.  Well, assume you own a patent, and a competitor infringes that patent – an ongoing tortious activity.  Assume further that you sue the competitor in Federal District Court for patent infringement.  And, during litigation, the competitor concedes the product it makes and markets infringes (some of) the patent claims.  The district court issues an Order with an injunction enjoining the competitor from engaging in any further infringing activity, such as marketing or making the infringing product. Later, to your surprised chagrin, the competitor starts selling a “slightly altered” version of the product!  What to…

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Practical Intellectual Property Practices for Corporate Clients

Imagine the embarrassment of having an email discovered during litigation where one of your employees exclaims that your new product probably infringes a competitor’s patent he has only just perused. Of course, it is sound business practice for companies to routinely review their competitors’ published patent applications and issued patents.    Armed with this information, your company can make strategic business decisions.  However, your company should take steps to avoid creating potentially harmful documents, emails and other correspondence that could be used against it in litigation. If your company has personnel involved in (a) reviewing the competitors’ published patent applications and issued patents and/or (b) monitoring the prosecution of a competitor’s patent application, then be sure to implement some simple policies on how to document and report the findings and concerns. Those policies should also address which individuals are to receive such reports and communications.  Finally, the policy should sensitize the…

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Is Your Invention Really New? Summarizing Novelty under the New U.S. Patent Law

In a race, it goes without saying that the first person to pass the finish line wins.  But, what would happen if the location of the finish line were suddenly moved back?  To a certain extent, that is exactly what has happened to U.S. patent applicants.  On March 16, 2013, the U.S. transitioned from a first-to-invent patent system to a first-to-file patent system. Now imagine that in addition to the finish line being moved back, runners are told that the rules of the race have changed.  In particular, the bases for disqualification, say, false starts and inappropriate contact, have been modified.  In light of the new definition of “novelty” under U.S. patent law, it is as though both the location of the finish line has moved and the rules for running the race have been modified. If innovators wish to remain competitive in the race to obtain patents, it is…

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The Highway Goes Global

Followers of our newsletter are familiar with the evolution of the Patent Prosecution Highway (“PPH”), from bilateral agreements providing for the acceleration of a patent examination in the office of second filing after the office of first filing finds allowable subject matter, to PCT PPH which allows the same acceleration based on a favorable examination in the international stage.  Now, the PPH evolution continues with the new Global Patent Prosecution Highway (“GPPH”), providing applicants with another cost and time saving tool for the management of global patent prosecution. As previously reported, the PPH program was developed to promote fast-track patent examination procedures and allow patent offices from around the world to take advantage of work already done by other offices.  The PPH was one of the initiatives undertaken by the USPTO to help with the always-increasing load of patent examinations. The PPH program as initially constructed involves bilateral agreements between…

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The Neglected Design Patent?

When people talk about patents, they generally mean a “utility patent.”  To date, over 8 million utility patents have issued in the United States.  In contrast, only about 680,000 design patents have ever issued.  Why that discrepancy?  It’s hard to fathom, especially after Apple Corp. recently won a $1.05 billion jury verdict for design patent infringement against Samsung Electronics in the ongoing battle for cell-phone supremacy.[1]  So, the oft-neglected and overlooked design patent is clearly “no lightweight” in high-stakes patent litigation between heavyweights.  Nonetheless, the utility patent has almost entirely subsumed the entire concept of “a patent” in the public mind. While a utility patent provides exclusive rights in useful technology, its neglected design patent cousin provides exclusive rights in “ornamental designs.”  As marketing executives know, the ornamental design of a product is often as significant, or even more compelling, as the useful features of the product, especially in the…

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Texas Fashionably Late to the Uniform Trade Secrets Act Party

Significant changes in the law in Texas with respect to trade secrets went into effect September 1, 2013, with Texas becoming the 48th state to adopt the Uniform Trade Secrets Act.  Previously, there was no central repository for Texas trade secret law, as it was a combination of the common law, restatements, and the Texas Theft Liability Act. The Act changes Texas trade secret law in a number of material respects and applies to any alleged misappropriation occurring on or after the effective date.  The extent of the changes will be determined by the courts as they interpret the Act but the Act is believed by many to eliminate a number of ambiguities that existed in the prior trade secret laws of Texas.  The changes will make trade secret protection broader in some circumstances and narrower in others, but will likely give more clarity to what is and is not…

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CLS Bank Patent Analysis and Claims Salvaging

The courts have been particularly active recently with respect to the question of what is patentable subject matter.  Despite this activity, there has been no real guidance provided by the courts to practitioners. In CLS Bank v. Alice Corp., the Federal Circuit found the claimed computer-related subject matter not patentable.  Unfortunately, there were seven different opinions in the case containing at least three different approaches to determining whether particular subject matter is patentable. While the Federal Circuit and commentators have concentrated on the claims formation and issues regarding §101 patentable subject matter, the real issue not addressed by either party are the deficiencies in the SPECIFICATION and DRAWINGS.  Without a properly written specification with supporting drawings that define the invention, there is no hope of generating supporting claims that meet the court’s requirements for §101 patentable subject matter.  Thus, when properly analyzed, the issue in the CLS case is one…

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