Federal
Circuit Affirms Summary Judgment of Invalidity
In Accenture Global
Services, GmBH v. Guidewire Software, Inc., (Appeal No. 11-1486), the
Federal Circuit affirmed the district court’s grant of summary judgment of
invalidity under 35 U.S.C. § 101.
The
Defendant moved for summary judgment, asserting that the patent-in-suit was
invalid because the claims were “drawn to abstract ideas that fail the
machine-or-transformation test.” Relying
on the Supreme Court opinion in Bilski, the district court held the patent to be invalid under 35 U.S.C. § 101,
stating that it was “directed to concepts for organizing data rather than to
specific devices or systems, and limiting the claims to the insurance
industry does not specify the claims sufficiently to allow for their
survival.” Accenture appealed the invalidity
finding as to the system claims, but not the method claims.
The
Federal Circuit reasoned that because the patent’s method claims have been
found to be patent ineligible, the first step was to compare the substantive
limitations of the method claim and the system claim to see if the system
claim offers a “meaningful limitation” to the abstract method claim, which was
adjudicated to be patent-ineligible. Under this analysis, the Federal Circuit
compares the two claims to determine what limitations overlap, then identify
the system claim’s additional limitations. In other words, the Federal Circuit must determine whether the system
claim offers meaningful limitations “beyond generally linking ‘the use of the
[method] to a particular technological environment.’” Id. (quoting Bilski,
130 S. Ct. at 3230).
The
Federal Circuit held that because, under the above two-part test, “the system
claim does not, on its own, provide substantial limitations to the claim’s
patent ineligible abstract idea,” and because appellant could not provide
substantial limitations to separate the appealed system claims from the ineligible
method claims, the system claims are ineligible. The Court, therefor, Affirmed the summary
judgment of invalidity under § 101.
Chief
Judge Rader dissented stating that “Appellant’s failure to appeal the
invalidation of the method claims estops it from arguing that the elements
contained therein (and shared by the systems claims) are directed to
patent-eligible subject matter.” He
stated that no precedent from the Federal Circuit or the Supreme Court
supports the idea, and that it creates “unsound policy.” “The court today sends a signal that
cautious litigants must appeal everything to avoid losing important claims.”
Federal
Circuit Transfers Appeal
In David Wawrzynski v. H.J. Heinz Company (Appeal
No. 2012-1624), the Federal Circuit concluded that it lacked jurisdiction
over the merits issues in the appeal.
Mr.
Wawrzynski allegedly designed a method for dipping and wiping a food article
in a specially configured condiment package. A user introduces a food article, such as a French fry, into the
container through the slit and dips it into the
condiment. As the food article exits the
container, the flexible cap wipes away excess condiment from the food article,
reducing the likelihood of a drip or spill. He was awarded U.S. Patent No.
5,676,990 (the ’990 patent) covering this method.
Mr.
Wawrzynski subsequently presented his condiment packaging idea to Heinz. After a meeting between Mr. Wawrzynski and
Heinz, Heinz informed Mr. Wawrzynski that the company was not interested in
the product ideas and did not
wish to receive additional information
from him. Months later, Heinz released its new “Dip & Squeeze®” packet.
On
October 5, 2010, Mr. Wawrzynski filed a lawsuit against the Heinz in state
court asserting claims relating to the Dip & Squeeze®. Heinz had the action removed to Federal
District Court on the basis of diversity jurisdiction. Mr. Wawrzynski filed
an amended complaint, including allegations of breach of an
implied contract and unjust enrichment, and
in its general allegations referenced the ’990 patent. Heinz filed an answer which alleged, inter alia, that Heinz did not
infringe the ‘990 patent and that the patent was invalid.
Mr.
Wawrzynski filed a motion to dismiss Heinz’s counterclaim on the grounds that
the counterclaim did not present a case or controversy under federal law
since Mr. Wawrzynski’s complaint was asserting state law claims, not patent infringement. He later covenanted not to sue Heinz on the
’990 patent. Heinz moved for summary
judgment of non-infringement, and the district court granted
Heinz’s
motion.
On
appeal, Mr. Wawrzynski argued that the district court’s ruling that his state
law claims are preempted by federal patent law were separate and distinct
from his patent. Mr. Wawrzynski also appealed the district court’s ruling
that it had subject matter jurisdiction over Heinz’s counterclaim.
The
Federal Circuit ruled that the complaint contained only claims to breach of
implied contract and unjust enrichment, and did not contain typical patent infringement
allegations. The Federal Circuit ruled
further that Mr. Wawrzynski’s sparse background discussion of his patent did
not make a well-pleaded
complaint for patent infringement, and
therefore the Court lacked subject matter jurisdiction over the appeal. In the interests of justice, rather
than dismiss the appeal, the Federal Circuit ordered a transfer of the appeal
to the United States Court of Appeals for the Third Circuit.
Federal
Circuit Reverses Grant Of Summary Judgment Of Inequitable Conduct
In Network Signatures, Inc. v. State Farm
Mutual Auto (Appeal No. 2012-1492), the Federal Circuit reversed and
remanded the district court’s grant of summary judgment of inequitable
conduct.
The
U.S. owned U.S. Patent No. 5,511,122 (the ’122 patent) relating
to internet security which was developed by a scientist at the
Naval Research Laboratory (NRL). The NRL permitted the patent to lapse
for nonpayment of the 7.5-year maintenance fee. Two weeks after the lapse
became effective, the NRL received an inquiry from
the predecessor to Network Signatures, Inc. about licensing the patent. The
NRL then petitioned the Patent and Trademark Office (PTO) to accept delayed
payment of the fee. The PTO granted
the petition and the patent was licensed.
Network
Signatures then sued State Farm for infringement of the ’122 patent. State Farm asserted that the patent was
permanently unenforceable on the ground that the NRL patent attorney had
engaged in inequitable conduct by “falsely representing” to the PTO that the
NRL’s non-payment of the maintenance fee was
“unintentional.” The district court granted summary judgment
of inequitable conduct, and held the patent unenforceable.
The
Federal Circuit held that failing to provide the reason for delay did not
establish inequitable conduct. The Federal
Circuit held further that the attorney complied with the USPTO’s standard
procedures using its standard form, which included a preprinted statement
that the delay was unintentional and required no further details about the
reasons.
Accordingly, the judgment was reversed and the case was remanded for
proceedings on the merits of the complaint.
Federal Circuit Reverses Grant Of Summary Judgment Of Invalidity
In High Point Design LLC v. Buyer's Direct,
Inc. (Appeal No. 2012-1455), the Federal
Circuit reversed the grant of summary judgment of invalidity.
BDI
is the owner of U.S. Design Patent No. D598,183 (the
‘183 patent) and the manufacturer of slippers known as SNOOZIES®. The district court granted a motion for
summary judgment on the grounds that the ‘183 patent was invalid on because
the claimed design was both (1) obvious in light of the prior art and (2) primarily
functional rather than primarily ornamental.
On
appeal, the Federal Circuit reversed the grant of summary judgment of
obviousness, holding the district court erred in applying the ordinary
observer standard to assess the obviousness of the design patent at issue;
erred by categorically disregarding an expert declaration; erred by not
providing sufficient detail to its verbal description of the claimed design
to evoke a visual image consonant with that design; improperly resolved
genuine issues of material fact; and failed to properly consider the secondary
considerations of nonobviousness. |
