The Patent Light

As many of you know, a few years ago Congress passed the America Invents Act (‘AIA’).  Much of this statute became effective on March 16, 2013.

Prior to the AIA, an inventor or an invention owner had a one-year “grace period” to file a patent application after commercially selling an invention or using the invention in public.  If the patent owner failed to file a patent application within the grace period after such activity, the patent owner was “barred” from pursuing patent rights.  The patent rights simply evaporated.  Such activities are known as “patent bars.”

Unfortunately, the AIA introduced ambiguity into the on-sale and public use patent bars.

The U.S. Patent and Trademark Office and a majority of patent attorneys believe that the AIA preserved the one year grace period.  We will call this interpretation “the majority reading.”  However, recent Federal Circuit cases have significantly eroded the validity of this interpretation.

To understand the issue, the relevant portions of the new AIA §102 patent statute are reproduced below:

(a) Novelty; Prior Art.—A person shall be entitled to a patent unless—

(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention;   .   .   .

(b) Exceptions.—

(1) Disclosures made 1 year or less before the effective filing date of the claimed invention.— A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention under subsection (a)(1) if—

(A) the disclosure was made by the inventor or joint inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or

(B) the subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor.

Under the majority reading of this provision, the one-year grace period is still in place because the AIA included a new phrase and patent bar: the “otherwise available to the public” patent bar. The majority argues that the phrase modifies the other patent bars preceding it.  In other words, all patent bars must be “available to the public” including the on-sale and public use bars. The majority argues that the AIA on-sale and public use bars now require public disclosure of the invention for the bar to apply, and the disclosure by the patent owner qualifies for the one-year grace period under other provisions of the AIA.

The majority reading is supported not only by a plain reading of the statute, but the legislative history, the USPTO interpretation, and the overall intent of the AIA.  For instance, one purpose of the AIA was to put U.S. patent law closer to that of the rest of the world.  The rest of the world essentially requires a public disclosure in order to bar an activity, such as placing the invention on sale or using the invention in public.  For example, in Europe or China, an invention can be used in public or put on sale without creating a patent bar if such use would not disclose the invention to a bystander or observer.

In contrast, the minority reading argues that there is no grace period under the AIA for any commercial sale or offer for sale or public use of an invention. Thus, any commercial sale or offer for sale or public use of the claimed invention instantly terminates all patent rights in the invention, unless a patent application has been filed as of the time of the commercial sale or offer for sale or public use.  In other words, the minority reading argues that pubic use and on sale activities are not “disclosures” under part (b) of the §102 statute.

One problem is that Congress did not define the term “disclosure” when it drafted the AIA.  If an “on-sale” bar is a disclosure, then the one year grace period still applies.  However, if an “on-sale” bar is not a disclosure, then the one year grace period does not apply.  The rationale is as follows: if the term “otherwise available to the public” does not apply to “on-sale” and public use, then these activities do not publicly “disclose.”  Consequently, they are not part of the exceptions of AIA §102(b) which only focuses on disclosures and not activities which do not “disclose.”  In other words, if on-sale and public use activities are not part of the exceptions, then the grace period of AIA §102(b)  does not apply.

The Federal Circuit Court of appeals rejected the majority’s rationale in Helsinn Healthcare v Teva on May 1, 2017. The Helsinn decision concludes that ‘available to the public’ is not a limitation on the on-sale and public use bars.  In other words, a sale or use does not have to “disclose” the invention to trigger the bars. Most patent attorneys believe the Federal Circuit panel of three judges were simply wrong.  Subsequently, Helsinn petitioned for en banc rehearing (a hearing of all Federal Circuit judges).  That petition was denied on January 16, 2018 and Judge O’Malley wrote a concurring opinion explaining the rationale and arguing that the “otherwise available to the public” phrase of the AIA §102(a) does not apply to the on sale and public use patent bars.

The Helsinn decisions do not directly determine the issue of whether the grace period still is in effect for sales or public use under the AIA – that issue was not raised or decided.  However, the Helsinn decisions knock the legal underpinnings from under the majority reading – leaving it in serious doubt.

Thus, for now, one should assume that the minority reading is correct.  In other words, there is no longer a one year grace period for public use or on-sale activities (which include offers for sale).

If you have any questions on this or any other IP topic on this blog, feel free to contact Bill Naifeh at www.naifehlaw.com.

In the last few posts, I discussed how to interpret “means plus function” clauses and used the U.S. 6,289,319 Patent issued to Lockwood as an example.  In this post, I will continue my analysis of certain claim elements of U.S. 6,289,319 Patent.

Recall from previous posts, the US 6,289,319 Patent contains a single independent claim which relates to an automatic data processing system including: (1) a central processor, (2) a terminal, and (3) a means for linking the terminal to the central processor.

In order to interpret the claims, I started with the central processor and looked at the first claim element of the central processor.  To continue the example, I will now analyze the second element, which is:

Means for retrievably storing said information

As previously explained, the first step in analyzing a means plus function claim is to determine the “function” of the claim element.  For simplicity and the sake of this series of posts, I will assume that the function of this means-plus-function clause is the actual wording of the claim, which is:

retrievably storing said information

Recall that “said information” refers to “means for receiving information” from the first claim element.  So, “said information” is information from the remote sites.  Thus, the function is:

retrievably storing information from remote sites

Once we determine the “function” of a means-plus-function clause, the next step is to determine what structure, if any, is disclosed in the specification that is linked or associated with the function.  The structure in the specification determines the meaning and scope of the claim element.  Obviously, from an infringement analysis perspective, it is important to determine the meaning and scope of the claim element.  (Of course, if no structure or a clear association to structure can be found in the specification, then the claim element is indefinite, and therefore, the claim is invalid.)

As with the previous post, I will first start with the drawings relating to the central processor (which conveniently is only Fig. 1). A portion of Fig. 1 is reproduced below:

In Fig. 1, the central processor is only represented as a box labeled with a reference numeral “4”.  The only structural candidate for the function of “retrievably storing information from remote sites” appears to be the memory which is labeled with a reference numeral “8.” The memory contains three files: a loan rate file 9, a quoted case file 10, and an active case file 11.  Because the files in the memory 8 seem to be linked (via the unidentified lines to the central processor 4, one can assume that memory 8 is some form of computer memory. Thus, from the drawings “MEMORY 8” appears to be the closest structural candidate for the function of “retrievably storing information from remote sites.”

Next, I will review the specification of the U.S. 6,289,319 Patent to specifically look for any wording which even remotely corresponds to the function of “retrievably storing information from remote sites” that can be associated with the central processor.  For convenience, I have numbered the provisions I found below:

(1)       The memory 8 of the central processor 4 holds some files 9 in which are stored information about the various loans available to customers from the institution. This information includes loan rates and repayment schedules. These loans include real estate loans, loans to finance the purchase of automobiles, boats and other vehicles, personal loans secured by certificates of deposit, stocks and other assets controlled by the financial institution 1 and unsecured personal loans.

(2)       Loan packages which have been quoted to customers are stored in a quoted case file 10 pending acceptance and execution by the applicant.

(3)       The central processor 4 of the financial institution 1 periodically sends to the terminals 5 at the various remote sites 2 loan rate information and other data pertinent to the loans available from that institution which are extracted from the loan rate file 9. That information is stored in the various terminals and can be reviewed by an applicant in need of a loan.

(4)       The terminal 5 is programmed to compute the credit worthiness of the applicant and to approve or disapprove the loan. Once the loan has been approved the applicant is requested to accept it or reject it. Accepted loan information is transmitted to the central processor of the financial institution and stored in the active case file 11.

(5)       Information about loans which have not been accepted on the spot, are also transmitted to the financial institution and stored for a period of time in the quoted case file 10.

(6)       The terminal then addresses the financial institution and requests 32 the prior loan quotation stored in the quoted case file 10 of the central processor 4. This is done by the data processor 13 of the terminal dialing the institution phone number through the modem 15 and sending a request message. The terminal goes into a standby mode with its DMA unit 16 waiting for a transfer of information from the line into the RAM memory 17.

(7)       Once a loan quotation has been presented to thus applicant he is asked whether or not he wants to apply for the loan 54. If his answer is negative, the fictitious loan officer expresses final greetings 55. The loan quotation, if not already in storage at the financial institution, is transmitted there for temporary storage in the quoted case file 10 of the central processor 4.

From the above passages, it seems clear that the “loan rate file 9” contains information that is sent to the remote sites.  However, only the quoted case file 10 and active case file 11 contain information received from the remote sites.

So, the “structure” corresponding to the function of “retrievably storing said information” most like refers to the quoted case file 10 or the active case file 11 of the memory 8.

However, in 1984-1986, computer processors had several types of memory, including disk storage, reel-to-reel tapes, cassettes and working storage memory.  The drawings seem to indicate that the memory was the type of memory that would hold files, which in 1984-1986 would have been most likely been reel-to-reel tapes, cassettes or disc memory on a peripheral.  Nothing in the drawings or specification indicate what type of memory would be used by the central processor.

Using the logic of  Ergo Licensing v. Carefusion 303, 673 F.3d 1361, 1365 (Fed. Cir. 2012), one could argue that because the exact nature of the memory was not specified, the recitation of “memory” provides no more structure than the function itself.  Thus, this claim element is also invalid.  However, it is likely that a judge would instead follow the logic of will follow of  In re Katz Interactive Call Processing Patent, 639 F. 3d 1303 (Fed. Circ. 2011) to hold that the function is generally well known and is of the type performed by a general purpose computer.  So, the structure in this situation is adequately disclosed because it is such a well known element.

Hence, because computer memory is so well known, the recitation of the memory of the central processor may be enough structure to satisfy the “public notice function” of 35 § 112 ¶ 2.  So, if a court takes this view, the court would hold that this claim element is definite, and therefore, the claim element would be considered valid.  Of course, this does not mean that the entire claim is valid.  If there is only one invalid claim element, then the entire claim is invalid.

In the last few posts, I discussed how to interpret “means plus function” clauses and have gone into great depth analyzing the U.S. 6,289,319 Patent issued to Lockwood as an example.  In this post, I will, at long last, finalize my analysis of the first “means-plus-function” claim element of U.S. 6,289,319 Patent.

Recall from previous posts, the US 6,289,319 Patent contains a single independent claim which relates to an automatic data processing system including: (1) a central processor, (2) a terminal, and (3) a means for linking the terminal to the central processor.  The central processor comprises several means-plus-function elements.  The first element is a “means for receiving information about said transactions from said remote sites.”

As explained previously, when construing the meaning or scope of a means-plus-function clause, one cannot rely on the wording of the claim element.  Instead, one must look to the specification to find a clear link between the function of the claim element and an associative structure in the specification.  I previously had to review the patent specification in painful detail in order to determine if there were any clear links or references to a structure or “means” which performs the function of “receiving information about said transactions from said remote sites.”  As explained in my last post, I could not find a clear link to a “structure” in the specification that performs this function.

So, under precedent established by the Federal Circuit, when there is no clear link to the structure or means in the specification, the claim element is indefinite and the claim is invalid. However, there appears to be an exception to this rule – which I will call the “Katz exception” because it comes from the Federal Circuit’s opinion in In re Katz Interactive Call Processing Patent, 639 F. 3d 1303 (Fed. Circ. 2011).

In Katz, the district court invalidated numerous claims own by a patent assertion company pursuant to the Federal Circuit’s analysis set forth in WMS Gaming, Inc. v. International Game Technology, 184 F.3d 1339 (Fed.Cir.1999), and Aristocrat Technologies Australia Pty Ltd. v. International Game Technology, 521 F.3d 1328 (Fed.Cir.2008), “because the specifications of each of the patents at issue disclosed only general purpose processors and did not disclose the algorithms that those processors used to perform the recited functions.”

The Federal Circuit agreed with the district court that some claims were invalid.  One claim element under scrutiny was:

processing means connected to the interface switching means for receiving customer number data entered by a caller and for storing the customer number data in a memory and based on a condition coupling an incoming call to the operator terminal, the processing means visually displaying the customer number data, the operator terminal providing other data entries to the memory to update data relating to the caller.

The Federal Circuit held that there was no algorithm disclosed which corresponded to the “based on a condition coupling an incoming call to the operator terminal” function.  Therefore, the above claim element was indefinite and the claim invalid.

However, the Federal Circuit went on to explain that the district court went too far with some of the other claim elements:

By contrast, in the seven claims identified above, Katz has not claimed a specific function performed by a special purpose computer, but has simply recited the claimed functions of “processing,” “receiving,” and “storing.” Absent a possible narrower construction of the terms “processing,” “receiving,” and “storing,” discussed below, those functions can be achieved by any general purpose computer without special programming. As such, it was not necessary to disclose more structure than the general purpose processor that performs those functions. Those seven claims do not run afoul of the rule against purely functional claiming, because the functions of “processing,” “receiving,” and “storing” are coextensive with the structure disclosed, i.e., a general purpose processor.

In other words, if the function is something that requires special programming, the patent specification must disclose the structure in the form of an algorithm.  However, if the function is generally well known and is the type of function usually performed by a general purpose processor, then a general purpose processor can supply the structure for the claimed function.

Additionally, recall the Federal Circuit’s opinion S3 Inc. v. NVIDIA Corp., 259 F.3d 1364, 1370 (Fed. Cir. 2001) discussed in a previous post. In S3, the claims recited a “means. . . for selectively receiving.” Id. The specification disclosed a “selector” as the corresponding structure without providing any information about the selector’s circuitry or operation. Id. The patentee, however, “presented evidence that a selector is a standard electronic component whose structure is well known in this art, and that such standard components are usually represented in the manner shown.” Id. Accordingly, the Federal Circuit found that the selector provided adequate structure for the “means for selectively receiving.” Id. at 1371.

Turning back to the US 6,289,319 Patent, a central processor is disclosed which presumably does “processing”, “receiving,” and “storing.”  Recall, however, that the function of the claim element in the ‘319 Patent is “receiving information about said transactions from said remote sites.”  So, the question is whether this function is something that can routinely be performed by a general purpose processor, a standard component, or does this function require special programming or special hardware?

Remember that the IBM personal computer was introduced in 1981 and its adoption in businesses took a number of years.  In the 1980’s (the time of this patent), most businesses used mainframe computers or what were called mini-computers, such as the IBM System 36, and System 38 or the DEC VAX-11.  The computer systems comprised a central processor physically connected to a number of “dumb” terminals via RS-232 cables.  The central processor used a system bus or I/O bus interface (for instance, DEC computers used an Omnibus) for the control and management of external signals (i.e. requests) to and from the terminals.

So, if the function we are considering was “receiving information about said transactions from terminals at the financial institution” this function might fall under “a Katz like” exception because one skilled in the art would understand that there is some common and well known software structure capable of performing this function.  However, the function of the US 6,289, 319 Patent is “receiving information about said transactions from said remote sites.”  Although this function is common today, in 1984-1986, receiving information from said remote sites may have required specialized hardware and some form of special interface with the central processor – especially considering how the ‘319 Patent was written.

For instance, the ‘319 Patent discloses that the central processor communicates with the terminals via telephone lines.  On the terminal side, the ‘319 Patent also discloses modems to convert digital signals to analog signals and vice versa so that the signals can be transmitted or received via the phone lines.  On the central processing side of the phone line, there must be some hardware that converts the received analog signals coming through the phone lines to digital signals for use by the central processor.  Thus part, if not all, of the means for receiving would necessarily include hardware for converting from analog signals to digital signals.  However, no such hardware structure is mentioned on the central processor side of the telephone lines.

As discussed in previous posts, the US 6,289,319 Patent discusses a communications interface, a communication control unit 6, and terminal monitor and update unit 7.  Except for naming these units in functional terms, there is no detail provided about the structure of these units or about how these work together to receive an analog signal or how they how they convert analog signals of the phone lines into digital signals, etc.  Furthermore, it appears that not all of these functional units were well-known.  The reader of the ‘319 Patent is left to wonder which, if any, of these units perform the analog to digital conversion, exactly what these units are, and how these units work together.  Therefore, our function probably does not fall under a Katz like exception.

Consequently, for this claim element, the public must guess as to the definition and scope of “the means for receiving information about said transactions from said remote sites.”  According to the Federal Circuit, when this happens such a claim element fails to fulfill the “public notice function” of 35 § 112 ¶ 2 by “particularly pointing out and distinctly claiming” the invention. See Praxair, Inc. v. ATMI, Inc., 543 F.3d 1306, 1319 (Fed. Cir.2008). By claiming a processor programmed to perform a specialized function (communicating with terminals over phone lines) without disclosing the internal structure of that processor in the form of an algorithm or special equipment, the claim element is likely to exhibit the “over-breadth inherent in open-ended functional claims,” in violation of the limits Congress placed on means-plus-function claims.  Hence, a court is very likely to hold that claim 1 is invalid because the claim element of “a means for receiving information about said transactions from remote sites” is indefinite.

Obviously, this is a very complex legal subject.  If you have any questions, feel free to contact Bill Naifeh at www.naifehlaw.com.

Note: This description of the process for analyzing the US 6,289,319 patent represents the author’s personal opinion and is for illustration purposes only.  This posting is not meant to convey legal advice and no one should rely on this post in any manner whatsoever.  If you have actual questions about the validity or scope of the US 6,289,319 patent, please consult with your own patent attorney.

In the last few posts, I discussed how to interpret “means plus function” clauses and used the U.S. 6,289,319 Patent as an example.  In this post, I will continue my analysis of certain claim elements of the U.S. 6,289,319 Patent. I apologize in advance for the length of this post.

Recall from previous posts, the US 6,289,319 Patent contains a single independent claim which relates to an automatic data processing system including: (1) a central processor, (2) a terminal, and (3) a means for linking the terminal to the central processor.

In order to interpret the claims, I started with the central processor and looked at the first element of the central processor element which is:

Means for receiving information about said transactions from said remote sites

For the sake of this series of posts, I assumed the function of this means-plus-function clause is the wording of the claim, which is:

receiving information about said transactions from said remote sites;

As explained in previous posts, once we determine the “claimed function” of a means-plus-function clause, the next step is to determine what structure, if any, is disclosed in the specification that is linked or associated with the function.  This structure in the specification determines the scope of the claim element.  So, from an infringement analysis perspective, it is important to determine the scope of the claim element.  (Of course, if no structure or a clear association to structure can be found in the specification, then the claim element is indefinite, and therefore, the claim is invalid.)

In the last post, I looked for the corresponding structure in the drawings and could find none.  So, in this post, I will review the specification and specifically look for any wording that even remotely corresponds to the claimed function of “receiving information about said transactions from remote sites” that is included in the central processor.

The specification of the US 6,289,319 Patent discusses communications between the central processor and the terminals in several places.  Because these provisions can be related to the function of “receiving information about said transactions from said remote sites,” I will have to go through the painful process of analyzing each provision. For convenience of discussion, I have numbered each of these provisions and have listed them below:

(1)       The system links a financial institution 1, a plurality of self-service terminals at various remote sites 2 and a credit rating service 3 by telephone lines or other means of telecommunication.

(2)       The central processor 4 has a communication interface which allows it to access the various terminals 5 at the remote sites and be accessed by them at any time of the day.

(3)       A communication control unit 6 associated with the central processor 4 assures an orderly sending and receiving of information between the terminals and the central processor. The communication control unit 6 provides for a quick transfer of batches of information to and from the terminals 5 under direct access memory mode. Direct access memory modes are achieved by means of high speed data exchange units such as those manufactured by Metacomp, Inc. of San Diego, Calif. and sold under the mark METAPAKS.

(4)       The central processor 4 is also provided with a terminal monitor and update unit 7 which is programmed for periodically polling the various terminals 5 in order to verify their status and proper operation and to update the data stored in those terminals as may be required.

(5)       The central processor 4 of the financial institution 1 periodically sends to the terminals 5 at the various remote sites 2 loan rate information and other data pertinent to the loans available from that institution which are extracted from the loan rate file 9. That information is stored in the various terminals and can be reviewed by an applicant in need of a loan.

(6)       The terminal 5 is programmed to compute the credit worthiness of the applicant and to approve or disapprove the loan. Once the loan has been approved the applicant is requested to accept it or reject it. Accepted loan information is transmitted to the central processor of the financial institution and stored in the active case file 11.

(7)       Information about loans which have not been accepted on the spot, are also transmitted to the financial institution and stored for a period of time in the quoted case file 10.

(8)       The terminal then addresses the financial institution and requests 32 the prior loan quotation stored in the quoted case file 10 of the central processor 4. This is done by the data processor 13 of the terminal dialing the institution phone number through the modem 15 and sending a request message. The terminal goes into a standby mode with its DMA unit 16 waiting for a transfer of information from the line into the RAM memory 17.

(9)       The loan quotation, if not already in storage at the financial institution, is transmitted there for temporary storage.

(10)     The institution is also notified 65, and the loan is processed through the active case file 11 by the central processor 4.

The analysis:

First, I will analyze the easy provisions.  For instance, provision (6) states:

(6)       The terminal 5 is programmed to compute the credit worthiness of the applicant and to approve or disapprove the loan. Once the loan has been approved the applicant is requested to accept it or reject it. Accepted loan information is transmitted to the central processor of the financial institution and stored in the active case file 11.

The phrase “Accepted loan information is transmitted to the central processor” is related to the claim function, but it is on the “sending” side of a transmission, not the “receiving” side.  Furthermore, this description is simply functional language.  In other words it is a description of what it does, but not the “how.” There is nothing in this provision that describes how or by what structure or “means” the information is transmitted, much less how it is received by the central processor.  Hence I can eliminate provision (6) from further inquiry because there is simply no indication of structure in this provision.

Similarly, I can eliminate provisions (5), (7), (9), and (10) from further inquiry because these provisions just describe the function or operation and without any indication of the structure necessary to perform the claimed function.

Turning now to provision (1), which states:

(1)       The system links a financial institution 1, a plurality of self-service terminals at various remote sites 2 and a credit rating service 3 by telephone lines or other means of telecommunication.

Provision (1) tells us that the financial institution is linked to the terminals by telephone lines or other means of telecommunications.  It should be noted that provision (1) does not say that the central computer is linked to the terminals, only the financial institution is linked.

However, assuming arguendo, that the provision is describing the unnamed “blue” lines of Fig. 1 described in the previous post, the structure candidates mentioned is: (1) telephone lines, and (2) other means of communication.  Arguably, telephone lines may be sufficient structure, but “other means of communication” cannot be adequate structure. The phrase “other means of telecommunication” is just a functional term.  So, this phrase cannot be considered a structure.  Thus, our focus will turn to what is left in the provision i.e., “telephone lines.” While telephone lines might be a structure for another function of another claim element, “telephone lines” are not part of the central processor.  So, from the language or organization of the claim, we know that we cannot use “telephone lines” as a structure for our function because the function must be also be part of the central processor.  We can, therefore, eliminate provision (1) from further consideration.

Going down the list, we now turn to provision (2), which states:

(2)       The central processor 4 has a communication interface which allows it to access the various terminals 5 at the remote sites and be accessed by them at any time of the day.

At first blush, the “communication interface” seems like it may be a structure because it appears to be a physical thing.  A Google patent search for pre-1986 patents reveals that several “communication interfaces” were known in network technology before the priority date of this patent. So, one skilled in the art of 1986 could apparently have used several communication interfaces as part of a central processor.  Provision (2) fails to specify which communication interface the inventor had in mind.

This situation is very similar to a case discussed in a previous post.  Recall from previous posts that in Ergo Licensing v. Carefusion 303, 673 F.3d 1361, 1365 (Fed. Cir. 2012), the patent claimed a “programmable control means having data fields describing metering properties of individual fluid flows.” Id. at 1363. The patent disclosed a “control device” as the corresponding structure, without any additional details about its design or circuitry. Id. Importantly, the control device in Ergo Licensing could have been one of “at least three different types of control devices commonly available and used at the time to control adjusting means.” Id. at 1364.  In Ergo Licensing, the Federal Circuit held that “[t]he recitation of `control device’ provides no more structure than the term `control means’ itself, rather it merely replaces the word `means’ with the generic term `device.’” Id. at 1363-64.  Thus, reciting a generic term for an electronic component is insufficient if an ordinary artisan would not associate the claimed component with a specific, well-known structure.

For purposes of this post, one can assume that the “communication interface” of provision (2) is a generic term and not a specific well known structure.  In fact, the word “interface” is really a nonce term and can be substitute for means.   So, the term communication interface is really equivalent to a “communication means” or “means for communicating” – which by definition is functional – not structural.  Thus, we can eliminate provision (2) from further consideration because provision (2) also does not contain any specific structure.  Provision (2) only contains a functional nonce term.

Going further down the list, we now turn to provision (3), which states:

(3)       A communication control unit 6 associated with the central processor 4 assures an orderly sending and receiving of information between the terminals and the central processor. The communication control unit 6 provides for a quick transfer of batches of information to and from the terminals 5 under direct access memory mode. Direct access memory modes are achieved by means of high speed data exchange units such as those manufactured by Metacomp, Inc. of San Diego, Calif. and sold under the mark METAPAKS.

Again, a Google patent search for pre-1986 patents reveals that “communication control units were common and that there were numerous “communication control units” known in network technology.  In fact provision (3) states that the function of the unit “assures orderly sending and receiving of information between the terminals and the central processor.” So, the unit could be some form of router, a network manager, or even just a system bus.  Under the logic presented in Ergo Licensing, the mere mention of a “communications control unit” does not provide sufficient structure for performing the function because the communication control unit could have been one of at least several different types of control units commonly available and used at the time to control communications.

Furthermore, the word “unit” is also a nonce term.  Consequently, “communication control unit” is equivalent to “communication control means” and hence, does not provide structure.

However, provision (3) goes on to explain:

The communication control unit 6 provides for a quick transfer of batches of information to and from the terminals 5 under direct access memory mode. Direct access memory modes are achieved by means of high speed data exchange units such as those manufactured by Metacomp, Inc. of San Diego, Calif. and sold under the mark METAPAKS.

The reference to this particular piece of hardware may provide sufficient structure for a function.  However, it appears that these high speed data exchange units were in the terminals – not the central processor. Note that “high speed data exchange units” is plural and so are terminals.  Furthermore, the provision states that “the terminals 5 under direct access memory mode.”  The provision goes on to explain that “Direct access memory modes are achieved by means of high speed data exchange units.” However, it appears that DMA mode only occur at the terminals – not at the central processor.  This interpretation is also consistent with Fig. 2 which shows a DMA unit as part of the terminal and has direct links to the memory of the terminal. A portion of the terminal of Fig. 2 is reproduced below:

As illustrated above, the DMA or Direct Memory Access Unit 16 communicates directly with the RAM memory 17, which in turn communicates with the data processor 13.  Contrast this arrangement to Fig. 1 of the Central Processor illustrated below:

As illustrated in Fig. 1, the communication control unit 6 does not seem to communicate directly with the memory 8 of the central processor.  Thus, it is unlikely that the communication control unit 6 somehow operates in a DMA mode.

However, assuming arguendo, that a Metacomp’s high speed data exchange unit was actually included in the communication control unit 6, there is still no clear link or association in the specification linking the Metacomp unit to the function of receiving information from the terminals.  Fig. 1 shows the communication links going directly into the central processor 4 – not the communication control unit 6 (see above).  Recall from previous posts that simply being able to identify structure in the specification is not enough for a means-plus-function clause.  The structure must be clearly linked or associated with the function of the clause.  Because there is no clear link at the central processor, we can eliminate provision (3) from further investigation.

Working our way further down the list, we now turn to provision (4), which states:

(4)       The central processor 4 is also provided with a terminal monitor and update unit 7 which is programmed for periodically polling the various terminals 5 in order to verify their status and proper operation and to update the data stored in those terminals as may be required.

Again the inquiry is to determine whether one skilled in the art in 1986 would recognize “a terminal monitor and update unit” as a specific piece of hardware or software (which could indicate structure) or whether this is just a generic or functional nonce term which is only indicative of the function of the unit.

A Google search does not indicate that one skilled in the art would associate a “terminal monitor and update unit” with a specific piece of hardware or software.  So, this particular phrase appears to be a term invented by the inventor or the inventor’s patent attorney.  In reality, however, the term “unit” is similar to the term “device” in that it is a nonce term which can be substituted for “means.” So, the terminal monitor and update unit is equivalent to a “terminal monitor and update means” or a “means for monitoring and updating the terminals.”  Thus, once again, there is no structure associated with the “terminal monitor and update unit.”

Furthermore, even if the phrase “terminal monitor and update unit” somehow could contain structure, there is no clear association or link of this unit to the function of “receiving information about said transactions from said remote sites” – especially because Fig. 1 shows that this unit is not even in the communication path and is bypassed altogether.  We can, therefore, eliminate provision (4) from further consideration.

As discussed above, provisions (5), (6), and (7) have already been eliminated.  Now turning to our last provision which could possibly relate to our function, we will investigate provision (8), which states:

(8)       The terminal then addresses the financial institution and requests 32 the prior loan quotation stored in the quoted case file 10 of the central processor 4. This is done by the data processor 13 of the terminal dialing the institution phone number through the modem 15 and sending a request message. The terminal goes into a standby mode with its DMA unit 16 waiting for a transfer of information from the line into the RAM memory 17.

Unfortunately, for Landmark Technologies (the exclusive licensee of the US 6,289,319 patent), provision (8) only appears to discuss what the terminal is doing.  The provision states “the terminal then addresses the financial institution” and this is done by “sending a request message.” But there is no mention of the structure involved with “receiving any request” on the side of the central processor.  The provision states that the terminal dials a phone number through a modem – which at least indicates some structural items, but there is simply no discussion of any structure on the side of the central processor.  We simply do not know how the central processor receives the request (i.e., by a modem, router, etc.).  But again, even if we can assume that there must be a corresponding modem at the central processor, this “assumed modem” is not clearly linked to the function.  So, once again provision (8) fails to provide the appropriate structure corresponding to the function of this means-plus-function element.

In summary, the specification does not appear to contain any disclosure of structure (or a clear linking a structure) within the central processor that could perform the function of “receiving information about said transactions from said remote sites.”  Without being able to clearly identify the structure, the public has no way of interpreting the scope of the claim.  When this occurs, courts hold that the claim element is indefinite and therefore, the claim would be invalid.

Today, the function of “receiving information about said transactions from said remote sites” is a pretty standard function – one of which can be performed by almost any computers.  Would a court really invalidate this entire claim if the patent attorney simply failed to put in a structure for this function?  Because this post is already horrifically long, I will answer that question in my next post.

For more information on this complex subject of means-plus-function claim interpretation, feel free to contact Bill Naifeh at www.naifeh.com.

In my last post, I discussed how courts construe “means plus function” clauses in a patent claim.  I also discussed the danger for patent owners when they rely upon means plus function clauses if there is no corresponding structure and/or no clear link to the structure in the patent specification.

Recall that “means-plus-function” clauses are governed by a patent statute which is now codified at 35 U.S.C. §112(f).  Although this provision has been in the statute since 1952, the way that courts have interpreted the provision has radically changed over the years.  In fact, twenty to thirty years ago, means-plus-function clauses were extremely popular and often used by patent lawyers.  However, as courts have imposed a greater number of restrictions in recent years on this type of claims (especially since the late 1990s), the popularity of the means-plus-function clause has substantially declined.  In 2013, Dennis Crouch, a famous and reputable law professor (among patent lawyers), charted the decline of the means plus function clauses for the years 2001 to 2013. His chart can be found here.

This and related posts will explore the process generally used by courts and patent attorneys to analyze means-plus-function clauses.  To illustrate the process, I have selected US Patent Number 6,289,319 issued to Lockwood because this particular patent contains several interesting and varied means-plus-function clauses.  (By way of background, the US 6,289,319 Patent is purportedly to be exclusively licensed to Landmark Technologies).

Note: This description of the process for analyzing the US 6,289,319 patent represents the author’s personal opinion.  This posting is not meant to convey legal advice and no one should rely on this post in any manner whatsoever.  If you have actual questions about the validity or scope of the US 6,289,319 patent, please consult with your own patent attorney.

The US 6,289,319 Patent contains a single independent claim.  The claim presumably covers an automatic data processing system which includes: (1) a central processor, (2) a terminal, and (3) a means for linking the terminal to the central processor. For simplicity, I will start analyzing the central processor.

The central processor of the US 6,289,319 Patent is exclusively defined by means-plus-function clauses.  The claim provisions relating to the central processor are reproduced below:

a central processor programmed and connected to process a variety of inquiries and orders transmitted from said remote sites; said central processor including:

means for receiving information about said transactions from said remote sites;

means for retrievably storing said information;

means responsive to data received from one of said terminals for immediately transmitting selected stored information to said terminal; and

means responsive to an order received from a terminal for updating data in said means for storing;

First I should point out that under a few relatively recent Federal Circuit cases, the “central processor” clause might be considered a means plus function clause.  But, that is a discussion for another post.  For this post, I will focus on the first of the four traditional means-plus-function clauses that are included in the claimed central processor.

Means for receiving information about said transactions from said remote sites

As discussed in my previous post, the first step is to determine the function of the means-plus-function clause to be analyzed.  The function of each clause is determined by a convention claim analysis discussed in a previous post.  (In other words, one first looks to the plain and ordinary meaning of the claims, then reviews the specification,  reviews the prosecution history, then if absolutely necessary, consults with extrinsic sources.)  For purposes of simplicity and this post, however, I will just use claim wording.  Thus, the function of the first means-plus-function clause appears to be:

receiving information about said transactions from said remote sites

As explained in previous posts, once I determine the function of the clause under review, the next step is to determine what structure, if any, is disclosed in the specification.  In other words, I now need to find some structure which is part of the Central Processor that can perform the function of “receiving information about said transactions from said remote sites.”

Although the specification must show a clear link or association between a structure in the specification and the function, the Federal Circuit has also held that one must not ignore the drawings because the drawings could also reveal a structure associated with the function.

So, I will first review the drawings relating to the central processor.  Fortunately, for this post, the only drawing that describes the central processor in the US 6,289,319 Patent is Fig. 1.  Fig. 1 is reproduced below.  For convenience and only for purposes of this post, I have highlighted several “lines” of Fig. 1 in various colors.  The lines are not labeled.  So, for purposes of this post, I will assume they must be some form of communication links.

In Fig. 1,  the central processor is only represented as a box labeled with a reference numeral “4”.  The blue lines appear to establish some form of communication between the Central Processor 4 and the Terminals 5.  If the blue lines are communication links, then they simply represent the function of a communication link.  Consequently, the blue lines cannot be considered a structure.  The red lines are apparently represent some form of communication between the Terminals 5 and the Data Processor 12 of the credit rating service.  The yellow lines appear to be some form of internal communication link or path.  However, again, these lines are not labeled nor discussed.

As illustrated in Fig. 1, there is a box labeled “Communic Control 6” and another box labeled “Terminal Monitor and Update 7.”  As discussed above, the blue lines from the Terminals 5 do directly to the Central Processor and appear to bypass both the Communication Control 6 and the Terminal Monitor and Update 7.  So, if the Communication Control 6 or the Terminal Monitor and Update 7 perform the function of “receiving information.  .  . from said remote sites,” it is not clear from the drawings how this how this function can be performed because there are no links from the Terminals 5 to either of these boxes.  In fact, it appears that Communication Control 6 and the Terminal Monitor and Update 7 only communicate with the Central Processor 4.

Furthermore, even if there was a communication link between the Terminals 5 and the Terminal Monitor & Update 7, there is no structure associated with the Terminal Monitor & Update 7 – except a box.  The Terminal Monitor & Update 7 is simply defined by the function it performs. Consequently, at least from the perspective of the drawings, the Terminal Monitor & Update 7 cannot provide structure for any function.  Although drawn as a box, it is actually described in functional terms.  The same holds true of the Communication Control 8.

In summary, there does not appear to be any identifiable structure in Fig. 1 that is included in the Central Processor 4 and is linked or associated with the function of “receiving information about said transactions from said remote sites.”

So, the next step is to search the specification.  Because this post is already lengthy, I will search the specification for the corresponding structure in my next post.  If you have any questions on this post, however, feel free to contact Bill Naifeh at www.naifeh.com.

In a previous post, I explained that when courts usually interpret or “construe” claim terms, they first look to the plain and ordinary meaning of the claims, then they look to the specification for unique definitions or use of the terms, they also look to the prosecution history, and finally they review extrinsic sources, such as technical dictionaries used in the field of the invention.

One exception to this procedure occurs when courts interpret what is called a “means plus function” claim or claim element.  This type of claim element is “statutory” meaning that it is governed by a provision in the patent statute.  It also called a “112, Paragraph 6” claim term under the older pre-AIA scheme.  After the AIA revisions to the Patent Act, the paragraphs in section 112 were numbered.  So, now patent attorneys refer to this paragraph as Section 112(f) or 35 U.S.C. 112(f).  Thus, when patent attorneys refer to “means plus function” claim, Section 112, Paragraph 6 claim, or Section 112(f) claim, they are referring to the same type of claim or claim element.

The current section 112(f) statute reads as follows:

(f) Element in Claim for a Combination.—

An element in a claim for a combination may be expressed as a means or step for performing a specified function without the recital of structure, material, or acts in support thereof, and such claim shall be construed to cover the corresponding structure, material, or acts described in the specification and equivalents thereof.

35 U.S.C. 112(f)

When courts construe “means plus function” clauses, they first identify the claimed function.  After identifying the claimed function, courts then determine what structure, if any, is disclosed in the specification that corresponds to the claimed function.

The very real danger when using this type of claim language is that if there is no corresponding structure in the specification, the claim element (and the entire claim) is deemed indefinite, and hence, invalid.

In order to qualify as “corresponding,” the structure disclosed in the specification must not only perform the claimed function, but the specification must clearly associate the structure with performance of the function.  This association must be clear to a “person of ordinary skill in the art” or what we call a “POSITA.”  In other words, would a POSITA be able to readily associate the structure in the specification to the claimed function?  If not, then the claim is invalid for failure to satisfy the definiteness requirement of another patent statute.

In some circumstances, the specification can provide adequate structure to support a means-plus-function limitation by calling out standard electronic components, even without detailing the component’s internal circuitry or operation. See, for instance, S3 Inc. v. NVIDIA Corp., 259 F.3d 1364, 1370 (Fed. Cir. 2001). In S3, the claims recited a “means. . . for selectively receiving.” Id. The specification disclosed a “selector” as the corresponding structure without providing any information about the selector’s circuitry or operation. Id. The patentee, however, “presented evidence that a selector is a standard electronic component whose structure is well known in this art, and that such standard components are usually represented in the manner shown.” Id. Accordingly, the Federal Circuit found that the selector provided adequate structure for the “means for selectively receiving.” Id. at 1371.

By contrast, reciting a generic term for an electronic component is insufficient if an ordinary artisan would not associate the claimed component with a specific, well-known structure. Ergo Licensing v. Carefusion 303, 673 F.3d 1361, 1365 (Fed. Cir. 2012).  In Ergo Licensing, the patent claimed a “programmable control means having data fields describing metering properties of individual fluid flows.” Id. at 1363. The patent disclosed a “control device” as the corresponding structure, without any additional details about its design or circuitry. Id. Importantly, the control device in Ergo Licensing could have been one of “at least three different types of control devices commonly available and used at the time to control adjusting means.” Id. at 1364.  In this instance, the Federal Circuit held that “[t]he recitation of `control device’ provides no more structure than the term `control means’ itself, rather it merely replaces the word `means’ with the generic term `device.'” Id. at 1363-64. Thus, an ordinary artisan would not associate the “control device” with a specific electronic component. Id.

Means-plus-function claiming involves a quid pro quo. When a patentee desires the convenience to express claims in terms of function, he or she then has a duty to clearly link or associate structure with the claimed function.  If the specification is not clear as to the structure that the patentee intends to correspond to the claimed function, then the patentee has not paid that price associated with the convenience of using a means plus function claim element.

Thus, a means-plus-function clause is indefinite if a POSITA would be unable to recognize the structure in the specification and associate it with the corresponding function in the claim.” All-Voice Computing PLC v. Nuance Commc’ns., Inc., 504 F.3d 1236, 1241 (Fed. Cir.2007) (citing Atmel Corp. v. Info. Storage Devices, Inc., 198 F.3d 1374, 1381-82 (Fed.Cir.1999)).

A patent is a bargain an inventor makes with the government.  The inventor increases public knowledge by disclosing the invention.  In return, if the U.S. Patent and Trademark Office (“USPTO”) believes that invention meets the statutory requirements, the inventor receives a monopoly as defined by the claims of the patent.  Thus, patents may be thought of as having two parts: (1) a specification (and drawings) which contain the patent holder’s discloser or contribution to the public knowledge, and (2) the claims which define the scope of the quasi-monopoly granted to the patent owner by the government.

Patent claims should be very precise so that the public has adequate notice of the exact scope of the monopoly. For this reason, claims are often written in an arcane legal language designed to specify the exact limits of the grant of monopoly – at least that is the theory.

In reality, patent claims are hard to read, harder to write and even harder to fully understand.  Unfortunately, it often takes years of legal training to fully understand the scope of patent claims because U.S. courts have held that claims do not always mean what they say.  In other words, to interpret the scope of the claims, one must often rely on more than just the “plain and ordinary meaning” of the claim language.

Courts have established legal doctrines which have both expanded claim breadth and have decreased claim breadth.  So, to interpret the proper claim scope for any given claim, several sources are usually analyzed and several legal doctrines are usually applied.

To determine the meaning of a claim, the “plain and ordinary meaning” of the claim terms are consulted first.  In fact, the preference is to use the plain and ordinary meaning of the claim terms when possible.  However, if the patentee used the claim terms in one way to obtain the patent, it would be fundamentally unfair for the patentee to be allowed to use the claim terms in a very different manner against potential infringers or competitors.

To check for consistency, the “plain and ordinary meaning” of the claim terms are compared to the usage of the claim terms in the patent specification.  Often, the claim terms will be defined in the specification or used in ways which will limit the scope or define the meaning of the terms in unique ways.

Next, the patent prosecution history will be consulted.  The patent prosecution history is the record of the back and forth negotiation with the USPTO to arrive at the issued claims.  In many situations during prosecution, the applicant will make statements or arguments which can be used later to define or limit the scope of the claims.  Again, the theory is that the patentee should be consistent in his/her usage of the claim terms.

Sometimes, other related patents or patent applications owned by the patent owner may also be consulted to see if similar terms were defined in these applications.  This is especially true when the patent in question is but one of a family of patent applications.

Finally, if the claim terms are not defined well in the patent specification and prosecution history, outside sources or extrinsic evidence such as industry dictionaries or reference materials (published around the time of the patent filing) may also be consulted in certain situations.

Furthermore, patent claims are presumed to be valid.  So, if a claim element can be interpreted in two different ways and one of those ways will invalidate the claim due to prior art, the claim element will be interpreted in such a manner as to uphold the validity of the patent.

On top of all this, certain judicial doctrines are often applied to the claim scope.  For instance, under the doctrine of equivalents, certain patent claim terms may be broadened to include their “equivalents.”  As an example, if the claim uses a nail, it is possible that a product that uses a screw might also infringe on the claim if the screw performs the same function as the nail, in the same way to achieve the same result.  In yet other situations, the claim scope may be narrowed.  For instance, if narrowing amendments to the claims were made during prosecution to overcome prior art references, the patent owner loses right to assert the doctrine of equivalents for the amended claims.  So, it is often necessary to review the history of claim amendments to determine which claim terms were amended during prosecution.

So, reading the patent claims is only the first step in determining claim meaning.  In fact, in patent litigation, a judge must construe the disputed claim terms before trial in what is called a “Markman Hearing” or “Claim Construction Hearing.”  During a Markman hearing the judge examines evidence from all parties on the appropriate meanings of relevant key words used in a patent claim, when patent infringement is alleged by a plaintiff.  Often, a Markman Order will determine the outcome of a case and force settlement if the judge interprets the claim terms in a narrowing manner so that no infringement is possible.

To sum, and at the risk of oversimplification, when interpreting patent claims, look to the plain and ordinary meaning of the claims first, then review the specification to see if the claim terms have been defined in the specification, then review the prosecution history of the patent (and any related patents).  Finally, you should apply the doctrine of equivalents to determine the exact scope of the claim breadth on any claim terms which were not amended during prosecution.

This is a confusing subject.  If you have questions, feel free to contact Bill Naifeh at www.naifehlaw.com.

Many companies or inventors unknowingly engage in activities which essentially forfeit their right to file for U.S. and international patents.  Patent attorneys call these activities “statutory patent bars” because the patent statute lists several activities which will “bar” an inventor or company from obtaining a patent.

The Good Old Days:

Before 2013, U.S. patent law was relatively friendly towards small inventors and smaller companies – who often take longer to develop inventions due to limited time and resources.  Under the previous regime of U.S. patent law, inventors could theoretically take years to invent and develop their product – and they would still have patent rights.  Additionally, once the invention was developed, inventors had a year to show the invention to different companies, investors, and manufacturers without losing their patent rights (as long as the inventors had good documentation of their inventive process and activities).  This “grace period” gave inventors time to explore the market and talk to investors before spending time and money investing in a patent application.

The rest of the world is not as friendly to small inventors and small companies.  The rest of the world has a first-to-file regime and strictly enforced secrecy requirements.  In other words, the first one to file a patent application takes priority over someone who invented first, but waited to file their patent application.  Furthermore, the rest of the world does not usually have a grace period.  In other words, any non-confidential or non-secret disclosure usually bars one from being able to obtain a patent in the future.

The American Invents Act or (“AIA”) became fully effective in 2013 and generally tried to harmonize U.S. law with the rest of the world.  However, as Congress tends to do, the AIA also tried to keep a few provisions from the previous regime – resulting in a confusing mess.  This post attempts to clarify some points of the more important “bars” of the AIA.

Best Practice:

The best practice is to assume that U.S. law is now harmonized with the rest of the world.  In other words:

(1)       You should file a provisional patent application as soon as practical – even if the product is not fully developed;

(2)       You should never disclose your idea or invention to anyone before you file for a patent application; and

(3)       You should file additional provisional applications as you develop or finalize the product or process.

U.S. law allows the filing of a provisional application.  So, even if your invention is not fully developed, you can supplement your initial provisional filing with additional detail as the invention develops – as long as you file the supplement provisional applications within a year of the first filing.  Again, it is important to file early and often.

Another best practice is to never disclose your invention until you file your provisional application, then only disclose the material that is in the provisional application (or applications).

Practical Realities:

Unfortunately, the best practices for disclosing an invention cannot be followed by all companies – especially small or start-up companies with limited funds.  Even provisional patent applications can be expensive, so often a small company must show or describe the invention to potential investors in order to have the money to properly obtain patent protection.

When a company cannot follow the best practices, companies should negotiate and obtain a confidentiality agreement or non-disclosure agreement (commonly known as a NDA agreement) with the recipient (or receiving party) of the disclosed invention (i.e., whomever the company is about to disclose the invention).

However, there are many potential problems with NDA agreements, some are:

Not all NDA agreements provide adequate protection – especially if the NDA agreement is provided by the receiving party.

Many investors (especially venture capitalists) will not sign NDA agreements.

(For more on NDA agreements see this ebook on NDAs from Amazon.)

As will be explained below, there is still a one year grace period under the AIA, but the new grace period is substantially weakened from the previous law.  Consequently, a company should never rely on the one year grace period and only use the grace period as a last resort to remedy inadvertent disclosures.

Current State of the Law:

The modern patent statute goes back to 1952.  Since 1952, every “barring activity” mentioned in this statute has been heavily litigated and courts have developed a fairly mature and well-defined body of case law interpreting the barring activities and exceptions to the barring activities.

When Congress passed the American Invents Act or the “AIA” which became effective in 2013, the statutory language changed.  Any lawyer will tell you that courts do not always interpret statutory language in a reasonable nor predictable manner.  Thus, we are now in an era where there is a great deal of uncertainty regarding the meaning of the new statute because courts have not yet had an opportunity to interpret the new language.

It is part of the United States Patent and Trademark Office (“USPTO”) job to interpret any new patent statute.  The rest of this memo attempts to explain and simplify the USPTO’s interpretation of the patent bars or patent barring activities of the new AIA statute.  However, the courts are not bound by the USPTO’s interpretation.  So, we do not know if a court will agree with the USPTO.

At the risk of oversimplification, the USPTO believes the AIA statutory bars are:

• The invention was patented previously anywhere in the world,
• The invention was previously described in a document available to the public anywhere in the world;
• The invention was previously in public use and the use was available to the public anywhere in the world;
• The invention was on sale or offered for sale to the general public anywhere in the world;
• The invention was otherwise available to the public anywhere in the world.

However, there are exceptions to the above “disclosures.” The exceptions are:

A disclosure does not bar patentability if made 1 year or less before the effective filing date of a claimed invention where:

(A)       the disclosure was made by: (1) the inventor, (2) a joint inventor or (3) by another who obtained the disclosure directly or indirectly from the inventor or a joint inventor; or

(B)       the subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor or a joint inventor or another who obtained the disclosure from the inventor or a joint inventor.

The “exceptions” are designed to give the patent owner the one year grace period for his/her own activities.  This is Congress’s attempt to carry over an old provision in U.S. law which allowed for a one year grace period.

So, if an inventor (or assignee): (1) publishes, (2) uses in a public way, (3) offers to sell or sell the invention to the public, or (4) makes the invention public more than one year before filing a patent, the inventor or assignee loses the ability to file for a patent.

Additionally, the inventor or assignee will be prevented from obtaining a patent if a third party (who has independently invented the invention or a similar invention) files for a patent before the inventor or assignee files for their patent.  In other words, the first person to file is entitled to receive the patent.  This is another major change of the AIA.  Previously, the first person to invent was entitled to receive the patent.

So, theoretically, if an inventor discloses an invention to a third party, the third party cannot file for a patent on the invention.  However, a fourth party, with no contact to the inventor or disclosure, can independently develop the invention and if the fourth party files a patent before the inventor, the fourth party filing will prevent the inventor from obtaining his/her patent.

But what if the third party told the fourth party about the invention?  Theoretically, the fourth party could not obtain patent rights.  However, it may be impossible to prove that the third party told the fourth party of the invention.  This is why one should never rely on the one year grace period.

Thus, one should still file provisional applications as early and often.  If you must disclose the invention before filing provisional application, then make sure you have a strong “disclosure friendly” NDA in place with the receiving party.

Bill Naifeh

www.naifeh.com

A key aspect of strategic patenting is U.S. continuation practice.  Continuation patents have several advantages and are widely used by small companies to build patent portfolios (especially companies who license their technology).  In fact, I almost always draft initial claims with the assumption that clients will file continuations at a later point in time.

A “continuation patent” is a new patent filed with different claims but with the same specification or technical description as a previous or “parent” application.  It is afforded the same priority date as the parent patent application.  U.S. continuation practice is somewhat unique in the world.  It allows an entire patent portfolio to be built around a few key patent applications.  In contrast to a divisional application discussed above, a continuation application is one where the applicant desires to obtain more than one patent from the same specification (and priority date).

One advantage of using continuations is that you can get more and better claim coverage.  Think of the process as the “Patent Two Step.” In the first step, you file your claims with the original application.  However, at that point, you do not know what prior art has been filed in the last 18 months.  In fact, unless you have an exceptionally good search report, you may not know of the relevant prior art.  Furthermore, you do not know which patent examiner will handle the case nor what prior art the Examiner feels is relevant.  In other words, when you file, you are going in blind.  So, at this point, as discussed in a previous “Narrow Claiming” post, it may be best just to first narrowly claim your invention and to get a patent issued as quickly as possible.

Once you have one notice of allowance, you implement the second step – you file a “continuation” patent application with new and broader claims. However, by this point, you know the prior art, the Examiner and you know what prior art he believes is important.  So, you are much more likely to draft better and broader claims.

A second advantage of using continuations is that you can claim various aspects or embodiments of the invention.  Often patent specifications describe several embodiments yet Examiners are pressured to only allow claims directed to one embodiment.  Continuation practice allows you to claim several inventions.

However, the most important advantage of using continuations is that the claim scope for the patent portfolio remains flexible. As long as there is some “live” continuation application, you can always change the claim scope of that continuation or you can file another continuation with new claims. This flexibility is extremely important to licensees, potential acquirers, and anyone who might be enforcing the patent portfolio.

There are important cost considerations too.  A small business can start with just a few applications, then patent other aspects contained in the applications at a later date – while claiming back to an original priority date.  The effective use of continuation practice allows a company to claim various aspects of inventions and systems at a later date when financial conditions are likely to be better.

In fact, the use of continuation patents is strongly encouraged and almost always recommended.  With the onslaught of recent challenges to patents, no one can guarantee that a patent will stand up if asserted in court or in a post grant challenge.  A continuation patent allows the patent owner to actually change claim scope in light of such challenges.

U.S. patent law specifies the general field of subject matter that can be patented and the requirements for a patent.  The purpose of these requirements is to make sure that the bargain between the government and the inventor or applicant is “equal” or balanced.  In other words, the law is designed to prevent the patent owner from receiving a larger monopoly than the patent owner deserves.  At least, that is the theory.  Whether the USPTO accomplishes this balance is hotly debated and the USPTO has been under extreme political pressure in the last few years to make sure that patent owners receive no more than they deserve (and often less than the patent owners deserve).

In the language of the statute, any person who “invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent,” subject to the conditions and requirements of the law.

The word “process” is defined by law as a process, act, or method, and primarily includes industrial or technical processes.  In addition to manufacturing processes, processes can theoretically include software, business methods, and websites.  The term “machine” used in the statute needs very little explanation.  The term “manufacture” refers to articles that are made, and includes all manufactured articles.  The term “composition of matter” relates to chemical compositions and may include mixtures of ingredients as well as new chemical compounds.  These classes of subject matter taken together include practically everything that is made by man and the processes for making the products.

Interpretations of the statute by the courts have limited the field of subject matter that can be patented.  For instance, courts have held that laws of nature, physical phenomena, and abstract ideas are not patentable subject matter.  Unfortunately, courts are not always consistent and often vary their interpretation over time and as a result of political pressure.  For instance, in 1998, the Federal Circuit (which is the appellate court for patent cases) held that business methods and websites were patentable.  In 2008, after a number of patent trolls began suing numerous websites and on-line businesses, the Federal Circuit essentially changed its mind and held that business methods are not patentable.

The 2008 case and other cases went up to the U.S. Supreme Court which confirmed the patentability of business methods and software, but only if they are NOT “abstract ideas.” Unfortunately, the Supreme Court did not provide meaningful guidance regarding the definition of abstract ideas.  Currently, most lower courts have held that business methods and software are not patentable subject matter because they are nothing more than abstract ideas.  So, today, many software patents (especially patents dealing with high or “application” level software) may not be valid under current case law.

Ideas are not patentable – only Inventions are patentable!

Contrary to popular belief, a patent cannot be obtained upon a mere idea or suggestion.  A patent is granted upon an invention (e.g., a new machine) and not upon the idea or features of the new machine.  Thus, a complete description of the actual machine or other subject matter for which a patent is sought is required to be submitted in the patent application.

The grant of a patent may be thought of as an exchange, bargain, or “quid quo pro” you make with the government.  In exchange for disclosing details about how to make and use your invention, you receive a 20 year “quasi-monopoly” for the invention described in your “claims” IF the patent office believes that your patent increases public knowledge in a meaningful way.  Ideas do not increase public knowledge because ideas alone are just science fiction.  Think about Star Trek’s transporter.  It is based on Einstein’s famous e=mc2 equation, but without more, the transporter is just an idea – not an invention.

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