The Dobrusin Law Firm - Intellectual Property

Strategic Intellectual Property Law

Category: Legal Updates

Recent Criminal Case Involving the Theft of Coca-Cola Trade Secrets Is a Cautionary Tale for Current or Departing Employees

Anyone who has ever left a job knows those final days involve tying up loose ends, saying goodbyes, and packing up. Walking out the door one last time with a box full of desk photos, coffee mugs, and other personal belongings is a career rite of passage. That box might even include some pens, Post-It notes, or paperclips that the employer probably won’t miss that much. But if you leave with some of your company’s trade secrets or proprietary information or disclose that information to others while still employed, you can be assured your employer – and perhaps federal or state prosecutors – won’t brush it off so easily. In fact, the consequences of sharing or absconding with trade secrets can be catastrophic for departing employees.

This was a lesson a Coca-Cola chemical engineer recently learned the hard way.

On May 9, 2022, a federal judge in Tennessee sentenced Xiaorong “Shannon” You to 14 years in prison after being convicted on charges of conspiracy to commit trade secret theft, economic espionage, conspiracy to commit economic espionage, possession of stolen trade secrets, and wire fraud. The charges arose from her theft of Coca-Cola’s trade secrets involving bisphenol-A-free (BPA-free) coatings found inside beverage cans. She had intended to start a BPA-free coating company in China with a corporate partner backed by the Chinese government.

The criminal charges You faced were because her theft involved passing on stolen information for the benefit of a foreign government in violation of federal law. Trade secret theft is also a state-level crime in most jurisdictions, meaning the penalties can be severe upon conviction, as You now knows. But even if the disclosure or misappropriation of trade secrets doesn’t result in criminal prosecution, employees who engage in such conduct can face significant and career-destroying consequences. It is important to understand what trade secrets are and how not to wind up on the receiving end of costly and disruptive litigation and, yes, potential criminal charges.

What Are Trade Secrets?

A slightly different kind of intellectual property, trade secrets are any type of confidential or proprietary information that gives a business an advantage over its competition. This can include customer information and lists or special formulas or business processes unavailable to others.

A more detailed and expansive definition is included in the federal Defend Trade Secrets Act of 2016, which describes “trade secrets” as:

  • all forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs, or codes, whether tangible or intangible, and whether or how stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing if—
  • the owner thereof has taken reasonable measures to keep such information secret; and
  • the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, another person who can obtain economic value from the disclosure or use of the information.

Even if the Employee Created the Trade Secret, It Likely Still Belongs to the Company

Trade secrets can be some of a company’s most valuable assets, so most prudent businesses make significant efforts to ensure they remain secret. This often includes non-disclosure and confidentiality provisions in employment or severance agreements. Violating these agreements by disclosing confidential company information can lead to significant damages and the clawback of any pay or benefits included in a severance package.

Making matters even worse, an employee who provides their old employer’s trade secrets to their new employer can embroil their new company in litigation, tarnishing or threatening their job before it even begins.

Unless they have nefarious motives, most departing employees will not abscond with what they believe to be company trade secrets. They will hand over hard drives, laptops, files, etc., as requested by their employer without incident. The challenge arises when the employee believes the information they take belongs to them. What if the employee created or contributed to creating the trade secret? Doesn’t that make it the employee’s property?

The answer to those questions is that it doesn’t usually matter if the employee played a role in developing the proprietary information – it is likely still the employer’s property. Many employment agreements specifically provide that any creative works produced by an employee while with the company are “works for hire” or that the employee assigns all rights in their work to the employer. Even without such an agreement, the employer will still probably assert its ownership of the information and seek relief from a court to recover it or stop the employee from further use.

If you are preparing to leave your current position and have questions or concerns about trade secrets and what you can and cannot take with you to greener pastures, please contact one of the intellectual property attorneys at The Dobrusin Law Firm.

Using a Photo on Your Website Without Permission? Picture Yourself Being Sued for Copyright Infringement.

Every business with a website –99 percent of businesses – wants their site to attract eyeballs and, ultimately, customers. They want their social media posts to pop. Photos and images are an essential part of website and social media engagement. The internet is full of millions of photos a company can easily download and upload to its website or include with its social media posts. But someone took those pictures and owns the rights to them. And if your business uses someone else’s photos without their permission, you expose yourself to a costly and disruptive copyright infringement claim.

Online Photos and Copyright Law

The photos you took of your family vacation, your dog, or one of your products – you own the copyright to all of them. This is the case even if you haven’t registered your copyright with the United States Copyright Office or used a © symbol or phrase such as “copyright-protected material” in connection with the photo.

The author or creator of a creative work – such as a book or article, movie, music, painting, or photograph – automatically and instantly obtains a copyright to that work upon its creation. Unless the photographer has assigned their rights to someone else, the photographer holds a copyright to the photo they took. While registering a copyright provides its owner with additional protections and rights under the law, a copyright owner has the right to control how their work is used and who uses it without affirmatively doing anything.

This includes the right to exclude others from reproducing or distributing the work or creating a “derivative work,” such as altering an existing copyrighted image with Photoshop or similar software. So, if a photographer stumbled upon one of their photos on your business’s website or in a post, they would have a valid claim for copyright infringement. Importantly, your state of mind when you uploaded the photo is irrelevant. Claiming you didn’t know you were infringing on someone’s rights is not a valid defense.

Things become even more treacherous if the image’s owner registered their photo or image with the Copyright Office. While the copyright owner can seek to recover any actual damages or losses they incurred because of the infringement, they can also obtain an award of damages from an infringer without showing they suffered any harm at all. They can seek to recover “statutory damages” from $750 to $30,000 per violation, along with their attorneys’ fees. Statutory damages for willful infringement can reach as much as $150,000 per act of infringement.

How to Avoid Copyright Infringement for Website Photos

Many claims of infringement for the unauthorized use of a copyrighted image on a commercial website are resolved without costly litigation by the user simply taking down the picture in response to a cease-and-desist letter. But there is no guarantee that the copyright owner won’t pursue the matter or demand a settlement payment to waive any infringement claims.

To avoid such problems, keep in mind these tips before uploading an image that you or your company did not create to your site:

  • Always presume a digital image or photo you find on the internet is copyrighted.
  • If you find a photo or image on the internet that you would like to use on your website, check to see if there is information about licensing or using the image on the site where you found it. If not, try to identify the copyright owner and ask them for a license.
  • If you do obtain a license, pay attention to the fine print; be sure you are allowed to use it for your intended purpose. Some licenses only allow very limited use, and some specifically exclude commercial use i.e., on your business website.
  • If you do not obtain a license or express permission to use an online image, do not use it. Train your staff and marketing department about these risks.
  • If you work with a web developer or marketing company that posts content on your site or elsewhere, make sure you have an agreement in which they agree to indemnify you for any damages based on copyright infringement.

If you have questions about using photos, images, or art on your commercial website, please contact one of the copyright attorneys at The Dobrusin Law Firm.

Understanding Specimens: A Bad Example of a Good Trademark Can Delay or Doom Your Application

The U.S. Patent and Trademark Office (USPTO) won’t issue a trademark registration for a mark that isn’t currently “used in commerce,” and it will cancel an existing mark if the owner does not show they are actively using their mark. But the USPTO won’t just take an applicant’s word that they are using their mark in commerce. The USPTO requires proof; they need a real-life example of how the trademark is used with the goods or services in the application or registration maintenance filing. They want to see what consumers see, meaning the applicant must submit a “specimen” demonstrating their use of the mark before it will issue or renew a registration.

However, not every specimen submitted makes the cut. The USPTO has very specific requirements for specimens, and if you want to avoid delays or the denial of your trademark application, you need to ensure yours is acceptable.

Goods v. Services

Because of the inherent differences between goods and services, the way marks are used with each differs. For example, you can put a label on a bottle of soda, but you can’t necessarily put one on an accountant.

Accordingly, what constitutes an acceptable specimen depends on whether it is associated with a good or service. For both goods and services, the specimen must show the trademark as actually used in commerce, so it directly associates the trademark with the goods or services. Trademark use is very specific, you can’t just use a mark in any manner and consider it “using your trademark.”

For goods, an acceptable specimen could be:

  • A tag or label containing the mark attached to the product.
  • Product packaging or a container showing the trademark on the packaging.
  • Sales displays at a location where the goods are available for purchase.
  • A website displaying the mark where the goods can be purchased or ordered.

For services, an acceptable specimen could:

  • Show the mark used for the services on an advertisement, brochure, website printout, or other material.
  • Include the mark on a television or radio ad.
  • Show the mark on business signs where the services are provided.
  • Show the mark on business cards or letterhead.
  • Show the trademark on a service vehicle.

Specimen Requirements

The USPTO will likely reject a specimen and thus reject your application or registration maintenance filing unless it meets these requirements:

  • It must be a real example of how you use your trademark in commerce in providing your goods or services. Mockups, proofs, and renderings of intended packaging won’t cut it.
  • It must show your trademark used with the goods or services listed in the application. A label displaying the mark won’t be accepted unless the label is shown on or attached to an actual product in the specimen, for example.
  • It must depict the same trademark as shown on the drawing submitted with the initial application.
  • There must be a specimen for each class of goods or services in your application or registration maintenance filing.
  • It must show your use of your trademark as opposed to use by someone else.
  • It must show the trademark used in a way that directly associates the mark with the goods or services.
  • It must show the trademark used in a way that consumers would see it as a source indicator for the goods or services in the application.
  • If the specimen is a webpage, it must include the URL and date you accessed or printed the webpage.

How and When to Submit Specimens

The USPTO won’t accept physical specimens, so don’t try shipping your product or business card to Washington. The specimen must be submitted electronically through the TEAS system.

If you are already using your mark in commerce, you should submit your specimen with your application. If you are filing an “intent-to-use” trademark application, you can either submit your specimen before the USPTO approves your application for publication by filing an Amendment of Allege Use (AAU) or after it issues a Notice of Allowance (NOA) by filing a Statement of Use (SOU). You also need to submit a specimen of the mark as currently being used in commerce with your affidavit or statement of use that must be filed between the fifth and sixth year after registration and then every ten years after that.

If you have questions about acceptable trademark specimens or need assistance with your trademark application, please contact the attorneys at The Dobrusin Law Firm.

EU’s Unitary Patent System Due to Finally Arrive Later This Year. Here’s What You Need to Know.

After a decade of efforts, the age of the Unitary Patent in the European Union (EU) appears to be imminent. It is expected that in the second half of 2022, inventors will be able to obtain patent protection in all participating EU states by filing a single application with the European Patent Office (EPO), thereby building on European patents granted by the EPO under the European Patent Convention (EPC) rules. This change in the European patent system means obtaining patents on the continent will soon become much simpler and much cheaper.

Background of the Unitary Patent

In December 2012, European countries and the European Parliament agreed to lay the groundwork for creating a Unitary Patent protection system throughout all EU member states. The two EU regulations establishing the Unitary Patent system went into force on January 20, 2013. In February 2013, all EU member states except Poland, Spain, and Croatia signed an intergovernmental treaty to establish a Unified Patent Court (UPC) to govern and administer the new system.

However, the UPC Agreement, a cornerstone of the Unified Patent framework, has yet to come into force because the three EU countries with the most European patents in effect in 2012 needed to ratify the agreement. One of those countries – Germany – has yet to do so. As such, the UPC is in a preparatory phase initiated on January 19, 2022, that should last eight to ten months. During this time, it is expected that Germany will deposit its instrument of ratification of the UPC Agreement, which will then trigger a preliminary period of three to four months before the UPC Agreement comes into force.

The Unitary Patent Framework

A European patent granted by the EPO on or after the date the UPC Agreement enters into force will form the basis of a Unitary Patent. Therefore, an applicant must first obtain a European patent before the EPO registers a Unitary Patent.

To be eligible for a Unitary Patent, the European patent must have been granted with the same set of claims, and the applicant must file the request no later than one month after the publication of the grant in the European Patent Bulletin. If a patent owner does not request the unitary effect, the patent will remain a “classic” European patent.

After the UPC Agreement enters into force, the Unitary Patents will only cover the EU member states that have already ratified the agreement. Currently, the following 17 member states will participate in the Unitary Patent when it starts: Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, and Sweden.

Although they are members of the EU, Spain and Poland have announced that they will not be parties to the UPC Agreement.  Additionally, as a result of Brexit, the UK is also no longer a party to the UPC Agreement. Outstanding ratifications will likely occur successively for Cyprus, Czech Republic, Greece, Hungary, Ireland, Poland, Romania, and Slovakia.

Key Features of the Unitary Patent System

Here are some key features to expect as the Unitary Patent system kicks into gear over the coming year:

  • Single annual fee. Owners will be able to maintain a Unitary Patent by paying a single annual fee to the EPO.
  • Translations ultimately not required. For a transitional period of at least six years, the application for unitary effect must be accompanied by an English translation of the description of the European patent if the patent is in French or German. If the patent is in English, it must include a translation of the description into any one of the languages of the EU. A translation will no longer be required at the end of this transitional period.
  • Harmonized patent law throughout all participating countries. Unitary Patents will confer uniform protection since the substantive patent law in infringement cases has been harmonized in the Agreement on a Unified Patent Court.
  • UPC to have exclusive jurisdiction but opt-out available during transition. The UPC will have exclusive jurisdiction over infringement claims and invalidity litigation concerning Unitary Patents, and any UPC decision will be controlling in all countries covered by the Unitary Patent. However, for a transitional period of at least seven years, litigation involving ‘classic’ European patents may be brought either before national courts or the UPC, at the claimant’s option. During this transitional period, “classic” European patent holders may exempt their patent from the UPC’s jurisdiction. This opt-out will no longer be allowed after the end of the transitional period.

If you have concerns about how these developments and upcoming changes will affect your European patent portfolio or plans on the continent, please contact the attorneys at The Dobrusin Law Firm.

Too Close for Comfort: Understanding “Likelihood of Confusion” and Trademark Registration Refusals

Trademarks such as brand and product names, slogans, logos, and taglines are designed to identify and distinguish businesses, goods, and services from others in the marketplace; they act as a source identifier, or they should. Every company wants its brand to stand out from competitors, and no company wants a competitor to build a brand that looks or sounds like its own. That is why registering a trademark with the United States Patent and Trademark Office (USPTO) is so important. It’s also why the USPTO will deny any application for a mark that creates a “likelihood of confusion” with an existing registered mark.

Finding that a “likelihood of confusion” exists between an applied-for mark and a registered mark or a pending application with an earlier filing date is one of the most common reasons the USPTO refuses trademark applications. Accordingly, anyone considering applying for a new mark should conduct a thorough trademark search to look for similar marks before investing the time and effort on a trademark likely to hit the likelihood of confusion wall. Applicants should also understand what likelihood of confusion means and how the USPTO evaluates proposed marks for these issues.

What Does “Likelihood of Confusion” Mean?

When the USPTO receives a new trademark application, an examining attorney will evaluate the proposed mark by, among other things, searching USPTO records to determine whether there is a conflict between the proposed mark and a mark that is either registered or pending in the USPTO.

Section 2(d) of the Lanham Act provides that an examining attorney may refuse to register a mark “which so resembles a mark” registered or pending with the USPTO “as to be likely, when used on or in connection with the goods of the applicant, to cause confusion, or to cause mistake, or to deceive…”

Likelihood of confusion exists between trademarks when they are so similar and the goods or services they are used with are so related that consumers would mistakenly believe they come from the same source. Marks need not be identical to create a likelihood of confusion; similarity in appearance, sound, or meaning can be and often will support a denial under Section 2(d).

Factors Considered When Determining Likelihood of Confusion

When evaluating whether there is a likelihood of confusion between a proposed and existing mark, an examining attorney considers several factors set forth in the seminal case of In re E.I. du Pont de Nemours & Co. As Section 1207.01 the Trademark Manual of Examining Procedure (TMEP) notes, not all du Pont factors are relevant in every analysis, and the significance of or weight given to a particular factor may differ from case to case.

The TMEP further states that “although the weight given to the relevant du Pont factors may vary, the following two factors are key considerations in any likelihood of confusion determination”:

  • The similarity or dissimilarity of the marks in their entireties as to appearance, sound, connotation, and commercial impression.
  • The relatedness of the goods or services as described in the application and registration(s).

The 13 du Pont factors used by the USPTO when evaluating likelihood of confusion are:

  1. The similarity or dissimilarity of the marks in their entireties as to appearance, sound, connotation, and commercial impression.
  2. The similarity or dissimilarity and nature of the goods described in an application or registration or in connection with which a prior mark is in use.
  3. The similarity or dissimilarity of established, likely-to-continue trade channels.
  4. The conditions under which and buyers to whom sales are made, i.e., “impulse” vs. careful, sophisticated purchasing.
  5. The fame of the prior mark.
  6. The number and nature of similar marks in use on similar goods.
  7. The nature and extent of any actual confusion.
  8. The length of time during and the conditions under which there has been concurrent use without evidence of actual confusion.
  9. The variety of goods on which a mark is or is not used.
  10. The market interface between the applicant and the owner of a prior mark.
  11. The extent to which the applicant has a right to exclude others from using its mark on its goods.
  12. The extent of potential confusion.
  13. Any other established fact probative of the effect of use.

An Inexact Science

As a quick glance at the 36 pages of TMEP Section 1207.01 makes clear, each of the du Pont factors involves complex issues and analyses of their own. And given that likelihood of confusion is a case-by-case evaluation, trademark applicants who are aware of similar registered marks are inherently rolling the dice when they proceed with their applications. Making matters even more uncertain, each of the 13 federal courts of appeal uses its own tests for evaluating whether a likelihood of confusion exists.

A USPTO examining attorney’s determination that there is a likelihood of confusion such that they will refuse registration is not necessarily the end of the road for an applicant, as they can appeal that decision to the Trademark Trial and Appeal Board.

Given how critical branding is to any business and the significant investment involved in developing and registering a trademark, consulting with experienced trademark counsel before proceeding with such efforts is of the utmost importance.

If you have questions about likelihood of confusion or need assistance registering your trademark, please contact the trademark attorneys at The Dobrusin Law Firm.

Show Your Work: What Is “Patent Marking” and Why Is It Important?

You put a lot of time, money, and effort into obtaining a patent and all the valuable rights and protections that come with registration. Those rights include the potential recovery of substantial damages from others who infringe on your patent. But if you fail to let the world know about your hard work by not properly marking your product or invention with the details of your patent registration, you could lose out on thousands or millions of dollars in compensation that would otherwise be available.

What Is Patent Marking?

Just as the registered trademark symbol ® and the copyright symbol © provide notice that the mark or creative work is protected under federal law, patents have their own marking rules. In its simplest sense, patent marking means displaying the patent number – or a URL for a website that contains the same information – on a patented product.

Why Is Patent Marking Important?

Proper patent marking serves as legal notice to potential infringers that a valid patent protects the product. If marking was proper, an infringer would have known or should have known about the existence of the patent as displayed on the product, and they could be held liable for damages that extend much farther back in time than they would without proper marking. In the absence of compliant patent marking, the clock would start ticking on damages only from the date the patent holder provides actual notice of infringement to the alleged infringer. Proper patent marking instead starts the period for which a patent holder can recover damages without actual notice of infringement. This could amount to as many as six years of damages.

Patent marking is not required under the law. But to avail yourself of the potential damages that arise from patent marking, it is essential that the marking complies with the requirements of Section 287(a) of the Patent Act. Improper patent marking will deprive you of recoverable damages, but it can also leave you exposed to liability for false marking if there is deceptive intent.

Marking Requirements Under The Patent Act

As provided in Section 287(a) of the Patent Act, anyone who makes, offers for sale, sells, or imports into the United States a patented product may give the public notice of the patent by marking it in one of three ways:

  • Affixing the word “patent” or the abbreviation “pat.” on the item, together with the patent number.
  • Affixing the word “patent” or the abbreviation “pat.” on the item together with the URL of a website accessible to the public free of charge that associates the patented article with the number of the patent (this is often referred to as “virtual marking”).
  • In cases where affixing such information cannot be done due to the character of the article (such as its size or materials), affixing a label containing that information to the item’s packaging. Marking in this manner is not proper if done for mere convenience or aesthetic reasons.

In the case of virtual marking, the listed website can’t just list a company’s patents or make associating a specific patent with a specific product a research project for visitors. The website must clearly correlate each product covered by at least one claim of a patent to that particular patent or patents.

What About “Patent Pending” Marking?

Plenty of patent applicants mark their good with “Patent Pending.” There is no requirement, detriment, or advantage to doing so. Unlike marking for issued patents, marking an item “Patent Pending” does not offer any additional protections or increase recoverable damages. But applicants should update their marking per the requirements set forth above once the patent issues.

Potential Liability For “False Marking”

Section 292 of the Patent Act allows the United States and anyone who has suffered a “competitive injury” to bring a claim against a patent holder for false marking. A claimant must show the patent does not cover the marked article and the patent owner marked the article with the intent to counterfeit or deceive the public.

There are many nuances to patent marking, and failing to “substantially comply” with the Patent Law’s requirements can make the marking worthless. If you have questions about or need assistance with patent marking, please contact the attorneys at The Dobrusin Law Firm.

Federal v. State Trademark Registration: What’s the Difference and Which One Is Right for Your Brand?

A trademark – whether a name, logo, packaging design, tagline, or slogan – is at the center of any company’s branding efforts and can be one of its most valuable assets. Like any important asset, a trademark warrants protection to preserve its value and keep others from diminishing or exploiting it for their own purposes. That is why trademark registration is essential for any business trying to establish itself and its brand.

But there is more than one way to register a trademark. While most people are familiar with federal trademark registration through the U.S. Patent and Trademark Office (USPTO), that is not the only game in town. You can also register your trademark with the state where your company is located and using the mark. For example, businesses that use their mark in commerce in Michigan can obtain a state registration from the Corporations Division of the state’s Department of Licensing and Regulatory Affairs.

Federal trademark registration and state registration are not mutually exclusive, though obtaining a federal registration usually deletes the need for a state one. But federal registration and state-level registration are not created equal. There are significant differences in the protections afforded by each type of registration and the complexity and costs involved in applying for registration.

So, what are the differences between federal and state trademark registration, and which one is right for your business and mark?

Advantages of Federal Trademark Registration

If you want the strongest, broadest protection for your mark and may use it outside your immediate geographic area, there is no substitute for registering your trademark with the USPTO.

There are several advantages to federal registration that a state registration cannot provide. Perhaps the most fundamental distinction between the two is that a federal registration protects your rights and your trademark throughout the entire United States (including its territories and possessions), while a state registration provides no protection beyond its borders.

Additional benefits of federal trademark registration include:

  • Deterrence of infringement. A federally-registered trademark is listed in the USPTO’s database of registered and pending trademarks. It provides the public, including people or companies looking to use or register a similar mark, notice of the mark’s registration, the goods and services with which it is used, and the dates the owner applied for and received trademark registration. Seeing a registered mark can deter other parties from using a confusingly similar mark that may lead to an infringement claim.
  • Presumption of ownership. Federal registration creates a legal presumption of ownership of the mark and the right to use it. If those rights become an issue in litigation, the registration certificate proves ownership without needing to present other evidence to support the claim.
  • Filing before actual use of the mark. A federal trademark application can be filed even before the mark is used in commerce. Filing on an “intent to use” basis allows an owner to get the ball rolling on registering their mark and securing an earlier filing date.
  • Foreign registration. While a federal registration is no guarantee of registration in another country, it can be the basis of seeking such protection.
  • Access to federal court. Federal registration allows an owner to pursue infringement and other claims in federal court.
  • Use of federal trademark symbol. The owner of a federally registered mark can use the federal trademark registration symbol, ®, with the mark, which may deter others from using the trademark or one too similar to it.

 State Trademark Registration

Registering a trademark with a state creates rights and protections in that state only. The mark will not be protected if the owner uses it in other states where it isn’t registered. Like most states and unlike the USPTO, Michigan requires an applicant to demonstrate actual use in commerce when applying, and a state registration does not confer the right to use the ® symbol. It cannot form the basis of a foreign registration, and it does not secure access to federal court.

Why Apply for a State Trademark Registration?

 For companies that do not currently or have no intention of using their mark outside their immediate area, federal registration may not be necessary or available. The requirements for federal registration and its application process are much more complex and stringent than for state registration. This includes demonstrating the mark’s current or future “use in commerce,” which means, among other things, using the mark across state lines. Additionally, the fees for applying for federal registration are significantly higher than for state registration. Federal registration fees (not including any attorney’s fees incurred preparing and prosecuting the application) run between $250-$750, while applying for a mark in Michigan costs $50.

The best way to determine which trademark registration path is best for your business is to meet with an experienced trademark attorney. If you have questions about how and where to register your mark, please contact the trademark attorneys at The Dobrusin Law Firm for assistance.

“Use In Commerce”: What It Means and What Applicants Need to Show to Obtain a Trademark Registration

The Lanham Act, which governs trademarks, may put things more artfully, but “use it or lose it” is a fundamental aspect of trademark law, as is “use it or never get it in the first place.” That is because the U.S. Patent and Trademark Office (USPTO) won’t issue a trademark registration for a mark that isn’t being “used in commerce,” and it will cancel an existing mark if the owner does not show they actively use their mark.

Trademarks such as brand and product names, logos, slogans, and taglines are designed to identify and distinguish companies, goods, and services from others in the marketplace. If a mark is not in the marketplace, it serves no purpose other than to clutter the federal trademark register. While you can start the trademark application process based on an intent to use the mark in commerce, you still need to prove actual use before the USPTO will issue a registration.

But not every use of a trademark constitutes a “use in commerce” sufficient to support registration. If you are applying for a trademark or want to ensure the USPTO does not cancel your currently registered mark, here is what you need to prove about your use of the trademark in commerce.

“Bona Fide” Use in Commerce Required; Token Sales Won’t Cut It

Section 45 of the Lanham Act defines the term “use in commerce” as “the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark.” The language regarding “bona fide use” was added to the law in 1998 to eliminate the practice of “token use,” or use made solely to reserve rights in a trademark. So, slapping a label containing your mark on a product and selling it to your Aunt Marie out of state for five dollars won’t cut it with the USPTO.

Goods v. Services

What constitutes bona fide use of a mark depends on whether it is being used in connection with goods or services.

  • A mark is deemed to be used in commerce on goods when:
  • It is placed in any manner on the goods or their containers or the displays associated with the goods or on the tags or labels affixed to them, or if the nature of the goods makes such placement impracticable, then on documents associated with the goods or their sale.
  • The goods are sold or transported in commerce.
  • When used with services, a mark will be considered used in commerce when it is used or displayed in the sale or advertising of services and the services are rendered in commerce or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services.

How Much and What Kind of Use Is Sufficient for “Bona Fide” Use?

Aside from the preceding statutory definitions of “use in commerce,” the Lanham Act does not define what constitutes “bona fide use of a mark in the ordinary course of trade” because, as the USPTO notes in Section 901.02 of the Trademark Manual of Examining Procedure (TMEP), “use in the ordinary course of trade will vary from industry to industry.” The TMEP also cites the Senate committee that drafted the statutory intended “that the revised definition of ‘use in commerce’ be interpreted flexibly so as to encompass various genuine, but less traditional, trademark uses, such as those made in test markets, infrequent sales of large or expensive items, or ongoing shipments of a new drug to clinical investigators by a company awaiting FDA approval….”

Given the everchanging landscape of commerce, the USPTO identified factors it will consider when determining compliance with the statutory requirement for a “bona fide use of a mark in the ordinary course of trade,” including:

  • The amount of use.
  • The nature or quality of the transaction.
  • Typical use within a particular industry.

Demonstrating use in commerce to support a trademark application requires submitting specific information and specimens to the USPTO. Given the importance of satisfying the “use in commerce” requirement, it is advisable to consult with an experienced trademark attorney to ensure your mark has the best possible chance of obtaining registration.

If you have questions about “use in commerce” or need assistance registering your trademark, please contact the trademark attorneys at The Dobrusin Law Firm.

Patent Mistakes Happen. A Patent Reissue Application Can Fix Them.

Nobody’s perfect, and neither are many issued patents. Often, errors and defects in a patent may threaten its validity and make it wholly or partly inoperative. In such cases, a reissue application is a valuable tool for correcting defects and ensuring the ongoing protection of a patent.

What Is a Patent Reissue Application?

As described in the U.S. Patent and Trademark Office’s (USPTO) Manual of Patent Examining Procedure (MPEP), a patent holder can file a reissue application “to correct an error in the patent, where, as a result of the error, the patent is deemed wholly or partly inoperative or invalid. An error in the patent arises out of an error in conduct which was made in the preparation and/or prosecution of the application which became the patent.”

What Types of Errors Can Be the Basis for a Patent Reissue?

As explained in the MPEP, an error that sufficiently supports a reissue must cause the patent to be “deemed wholly or partly inoperative or invalid, by reason of a defective specification or drawing, or by reason of the patentee claiming more or less than he had a right to claim in the patent.” Therefore, only substantive errors can justify a reissue. Patent corrections related to spelling, grammatical, typographical, editorial, or clerical errors are not sufficient unless such an error renders the patent wholly or partly inoperative or invalid.

According to the USPTO, the most common reasons for filing a reissue application are:

  • The claims are too narrow or broad.
  • The disclosure contains inaccuracies.
  • The applicant failed to or incorrectly claimed foreign priority.
  • The applicant failed to refer to or incorrectly referred to prior co-pending applications.

What Are the Requirements for Submitting a Patent Reissue Application?

The following elements are all required to obtain a reissue patent:

  • The patent’s specification, claims, or drawings must be wholly or partly inoperative or invalid.
  • The error was made without deceptive intent (this requirement was removed for patent reissue applications filed under the AIA).
  • The patent owner must surrender the original patent.
  • The patent owner must pay the appropriate fee.
  • The application for reissue cannot contain any new matter.
  • If the reissue application enlarges the scope of the claims in the original patent, it must be filed within two years from the grant of the original patent.

A patent holder must include each of the following items in their reissue application:

  • The specification, drawings, and claims as amended, including the entire original patent.
  • Where applicable, a “chain of title” signed by an assignee and written consent by the assignee.
  • An offer to surrender the original patent.
  • A reissue declaration stating that the applicant believes the original patent to be “wholly or partly inoperative or invalid” because of a defective specification or drawing or because of claiming more or less than the owner had a right to claim.
  • A claim for the benefit of foreign priority, if appropriate.

Reissue Risks

Filing a reissue application is not without some risk. Since the Examiner will review the application as it would an original patent application, it reopens the patent prosecution of the claims, allowing the Examiner to raise objections or questions regarding validity or allowance.

The reissue declaration that the patent holder must submit with their application also poses some potential dangers that require consideration before seeking a patent reissue. Most patent owners seek reissue due to litigation and want to amend the claims to specifically cover the alleged infringing product. In such circumstances, the declaration, made under oath, is an admission by the patent owner that they have claimed less than they are entitled to. However, at that point they may have a valid claim that seems to read on the alleged infringing product and may lose it all during the re-examination process Additionally, the claims may be narrower, and the oath is an admission in court that the patent is invalid.

Accordingly, patent owners must tread carefully when seeking reissue related to litigation as the inventor’s oath or declaration for a reissue application must also state that the applicant believes the original patent to be wholly or partly inoperative or invalid by reason of a defective specification or drawing, or by reason of the patentee claiming more or less than the patentee had a right to claim in the patent.

If you have questions about patent reissue applications or concerns that an existing patent may contain errors needing correction, please contact the attorneys at The Dobrusin Law Firm.

Use It (Soon) or Lose It: Understanding “Intent-to-Use” Trademark Applications

Effective branding is a critical component of any successful, consumer-facing business. But the process of developing and trademarking a name, design, logo, or tagline for your company can and usually should be a careful and deliberate one. No business wants to invest time, money, and effort to put their brand in the marketplace, only to subject it to infringement claims or other challenges. At the same time, you may have a brilliant trademark you want to protect ASAP, even if you’re not ready to use it. Filing an “intent-to-use” (ITU) trademark application with the U.S. Patent and Trademark Office (USPTO) could be the way to do it.

Trademark Registration Is Only for Marks That Are – Or Soon Will Be – Used in Commerce

Trademarks are designed to identify and distinguish companies, goods, and services from others in the marketplace. That is why the U.S. Patent and Trademark Office (USPTO) won’t issue a trademark registration for a mark that isn’t being “used”. Trademark registration is only available for marks that are “used in commerce,” and an applicant must demonstrate actual use before obtaining a registration. Most business owners believe that you must be currently using your mark to even apply for registration. In reality, waiting to file for your mark can actually cost you valuable time and allow someone to “get ahead of you’ in line.

For purposes of trademark registration, “use” or “use in commerce” means:

  • For goods, the applicant has placed the mark on the goods, packaging for the goods, or point-of-sale displays associated with the goods (including webpage displays), and the goods are actually being sold or transported in commerce. This is not an all-inclusive list and there are many exceptions, caveats, and rules relating to use on goods.
  • For services, the applicant uses the mark in the sale, advertising, or rendering of the services, and the services are actually being rendered in commerce.

Use in commerce cannot be token use just to reserve rights in a mark, but use must be in the “ordinary course of trade.” In other words, you can’t ship one product to your Aunt Diane in Ohio and claim use in commerce.

Many companies submit their applications after they’ve already satisfied the use in commerce requirement. However, if you have not used your mark in commerce yet but intend to do so in the not-too-distant future, you can start the process of protecting your mark by filing an application to register your mark on an intent-to-use (sometimes called a Section 1(b)) filing basis.

Getting a trademark application on file when a mark is ready, even if it’s not ready for use in commerce, is important in terms of the protections afforded by federal trademark registration. That is because when a dispute or challenge arises between two applicants or trademark holders whose marks are similar or conflict with each other, the party whose application has the earlier filing date will usually have an advantage both at the USPTO and in any infringement litigation.

Proving Use in Commerce After the Filing of an ITU Trademark Application

While the USPTO allows you to start the registration process before you use your mark in commerce, they will not wait forever for you to do so. In fact, there are strict filing deadlines for submitting proof that the mark is being used in commerce in connection with the goods or services identified in the application.

When the USPTO has allowed your mark to proceed to registration, i.e. finished their examination, they will issue a Notice of Allowance. The applicant then has six months from the date the USPTO issues a Notice of Allowance to file a Statement of Use (SOU) along with evidence of trademark usage (specimens of use), a signed declaration from the applicant confirming that use, and a filing fee. Alternatively, an applicant can pay a fee and file a request for a six-month extension for filing an SOU within that same deadline. These extensions can be requested every six months, with a fee, up to three years.  Once you have reached the extension limit, and you have not filed your NOA, the application will be deemed abandoned, having never obtained registration status.

Filing an intent-to-use trademark application can be a great way to get the ball rolling on your pursuit of federal trademark registration and all the benefits and protections registration provides. If you have questions about intent-to-use applications or need assistance registering your mark, please contact the patent attorneys at The Dobrusin Law Firm.

The Trademark Modernization Act and the USPTO’s New Final Rule: What Trademark Applicants and Owners Need to Know for 2022

In December 2020, the Trademark Modernization Act (TMA) was signed into law. The TMA made several changes to the Lanham Act, the federal law that governs trademark registration in the United States. The amendments focused on three primary objectives:

  • Clarifying the evidentiary burden a plaintiff needs to meet to obtain injunctive relief in trademark infringement lawsuits.
  • Addressing the problem of fraudulent trademark registrations – including marks that are not actually being used in commerce – by providing new procedures for canceling such registrations.
  • Streamlining and accelerating the trademark prosecution process before the U.S. Patent and Trademark Office (USPTO).

The USPTO recently published its final rule implementing the amendments contained in the TMA. Most changes became effective December 18, 2021, though certain changes won’t go into effect until December 1, 2022.

Here is what trademark applicants, trademark holders, and those claiming infringement of their marks need to know about the changes contained in the TMA and the USPTO’s final rule.

Rebuttable Presumption of Irreparable Harm in Trademark Infringement Actions

 Plaintiffs in trademark infringement lawsuits often ask the court to issue a preliminary injunction requiring the alleged infringer to cease their use of the mark or provide similar relief. To obtain such injunctive relief, a plaintiff must demonstrate that the defendant’s actions are causing them “irreparable harm.”

The TMA resolved a split between federal appellate courts about evaluating claims of “irreparable harm” by amending the Lanham Act to establish a rebuttable presumption of irreparable harm upon a finding of infringement or of likely success on the merits when seeking a preliminary injunction.

Challenging Fraudulent Marks or Those Not Being Used in Commerce

To receive a trademark registration and for a mark to remain valid going forward, the applicant/holder must demonstrate that the mark is being “used in commerce.” However, the trademark register is cluttered with marks whose owners’ claims of actual use are dubious at best, and fraudulent at worst. Often, these registered but unused marks stand in the way of applications for new marks that may be too similar in the USPTO’s view to allow for registration,

The TMA and the final rule attempt to address this issue by creating new ways for third parties (including the USPTO) to challenge and seek the cancellation of registrations based on nonuse.

Reexamination

Within the first five years of a mark’s registration, any party (or the USPTO director) can file a reexamination action seeking to cancel some or all of the goods or services contained in a use-based registration if the trademark was not in use in commerce in connection with those goods or services before either:

  • The application filing date if the application was based on Section 1(a) (Use in Commerce), or
  • The date the amendment to allege use was filed, if the application was filed based on Section 1(b) (Intent to Use), or the date the applicant needed to file a statement of use, whichever is later.

Expungement

Similarly, between the third and 10th year of a mark’s registration, any party can bring an expungement action before the USPTO seeking to cancel some or all of the goods or services covered by a registration based on the registrant never having actually used the mark in commerce in connection with the claimed goods or services. However, until December 27, 2023, a party can request an expungement action for any registered mark that is at least three years old, regardless of how long the mark has been registered.

A party seeking cancellation either through a reexamination or an expungement proceeding must pay a fee and submit a petition that contains, among other things, a verified statement of the facts, including details of the petitioner’s reasonable investigation of nonuse and a “concise, factual statement of the relevant basis for the petition.”

The USPTO director will review the petition, the submitted evidence, and the registration’s electronic record to determine whether to institute a reexamination or expungement proceeding. The director’s decisions are final and non-reviewable. If the director institutes a proceeding, the USPTO will issue an office action requiring the registrant to submit evidence rebutting the prima facie case of nonuse. If the registrant fails to establish use in commerce, the USPTO will issue a final action canceling the mark, and the registrant will have three months to file a request for reconsideration or an appeal to the Board

Shorter Three-Month Response Period for Office Actions

Starting December 1, 2022, trademark applicants (excluding Madrid Section 66(a) applicants) must respond within three months to office actions issued during examination of an application. For a $125 fee, applicants can request a single three-month extension of time to respond.

If you have questions about how the Trademark Modernization Act and the USPTO’s final rule impact your existing trademarks or pending applications, please contact the trademark attorneys at The Dobrusin Law Firm.

In a Significant Change, Federal Circuit Narrows Scope of Prior Art That Could Stand in the Way of a Design Patent Application

Many patentable items will not only do something; but will look like something. A utility patent may in part protect what an “article of manufacture” does, while a design patent protects what an article of manufacture looks like (i.e., its unique exterior appearance, such as its shape, configuration, or surface ornamentation). But what happens when an applicant seeks a design patent similar to a prior design for a completely different type of “article of manufacture”? A recent decision by the U.S. Court of Appeals for the Federal Circuit addressed that issue, and the opinion has significant implications for those seeking protection for the appearance of their goods.

Lip Implant v. Art Tool

In re: SurgiSil, L.L.P., et al. involved a design patent application for “an ornamental design for a lip implant as shown and described.” The art submitted by SurgiSil for its lip implant showed the design as follows:

The Patent Examiner at the U.S. Patent and Trademark Office (USPTO) rejected SurgiSil’s design patent claim as being “anticipated” by a patented design for an art tool sold by art material supply company Dick Blick:

A design patent is only issued if the design is considered “novel.” A design will not be considered novel if it is “anticipated” by prior art; that is, if a single prior art reference in a previously granted patent shows a substantially similar design, the design will not be novel.

The Patent Trial and Appeal Board (PTAB) affirmed the Examiner’s rejection of SurgiSil’s application, finding that the differences in shape between SurgiSil’s claimed design and Blick’s art tool were minor and explaining that to determine anticipation, “it is appropriate to ignore the identification of the article of manufacture in the claim language.” 

Anticipation Not Found in Similar Designs for Different “Articles of Manufacture”

On October 4, 2021, the Federal Circuit reversed PTAB’s decision to reject SurgiSil’s application. The Court found that SurgiSil’s claimed lip implant was not anticipated by Blick’s art tool, holding that “[a] design claim is limited to the article of manufacture identified in the claim; [and] it does not broadly cover a design in the abstract.” Since SurgiSil’s claim language limited its invention to a design for “lip implants, Blick’s prior art directed to an artist’s tool did not anticipate a claim to a lip implant.”

The Federal Circuit’s decision means that to anticipate a design patent claim appropriately, the prior art needs to come from an analogous art field. This is a dramatic shift from previous practice in which Examiners could rely on art from any field to find anticipation. Since the scope of prior art that could impede a design patent application is now significantly narrower, applicants may find a more favorable outcome in obtaining design patents going forward.

If you would like more information about the In re SurgiSil decision or design patent applications generally, please contact the attorneys at The Dobrusin Law Firm.

The What, Why, and How of Continuation Patent Applications

The patent application and examination process is not static. After an inventor files a non-provisional patent application, there may be opportunities to modify or expand claims made in the original “parent” application or even add new claims related to the same invention before the parent issues. Continuation-type patent applications are vehicles through which inventors can strengthen the protections afforded to their innovations and respond to changes in technology, the marketplace, or the invention itself.

What Is a Continuation Patent Application?

A continuation patent application allows a patent applicant to pursue patent claims based on the same specification and drawings as previously filed in the pending “parent” application. It is a new application with new claims and associated fees but must contain the same patent illustrations and written description as the parent application. It will also share the same priority date as the parent application.

While a continuation involves the same underlying invention described in the parent application, it includes different claims that may be broader, narrower, or related to another aspect of the invention than the inventor claimed in their original application. The scope of a continuation application’s claims cannot be identical to those in the parent application.

Instead, claims in a continuation application can be canceled claims from the parent application. Claims in a continuation application can also be strategically drafted to cover a competitor’s product or service (if adequately described but not claimed in the parent application) that came to market after the parent patent application’s priority date.

Divisional Applications and Continuation-In-Part Applications

Closely related to continuation patent applications, and offering similar benefits, are divisional applications and continuation-in-part applications.

Like a continuation application, a divisional patent application uses the same specification and patent illustrations as the parent application and shares the same priority date. Unlike a continuation application, which contains new or different claims, a divisional patent application presents patent claims that the applicant already filed with the parent application. These existing claims might have been voluntarily withdrawn or canceled, or the U.S. Patent and Trademark Office (USPTO) may have required the applicant to withdraw or cancel them.

A continuation-in-part (CIP) application, which repeats a substantial portion to all of the parent’s specification, can also be filed during the lifetime of the parent application. The key feature of a CIP is that it allows the inventor to add new material to the specification and patent illustrations not previously disclosed in the parent application. This is a great route for inventors who have refined their invention and want to add or remove elements or include new improvements developed after the parent patent application was filed.

Claims in the CIP application based solely on the parent application’s disclosure will receive the parent application’s priority date. Any claims based on the new disclosure or a combination of the old and new disclosures will only be entitled to the CIP application’s filing date.

Why Consider a Continuation Patent Application?

There are several reasons an inventor may consider a continuation patent application as part of their overall patent prosecution strategy:

  • Claiming Multiple Inventions. A patent can only claim one invention. However, many patent applications are drafted or determined by the USPTO to cover multiple inventions. For such applications, the USPTO may issue a “restriction requirement” that divides up the inventions and asks the applicant to select one for examination. The applicant can then pursue other non-elected inventions in a divisional patent application.
  • Broadening Claims. Patent applications are sometimes allowed with claims providing only “narrow” coverage. For example, an applicant may establish an immediate defense by expediting claims to a specific embodiment of an invention or by accepting an Examiner’s offer to allow a subset of the pending claims. In such circumstances, an applicant can use a continuation application to pursue “broader” protection. They may also file a continuation to cover alternative embodiments of the invention or block design-arounds.
  • Evolving Technology. Technology is constantly changing. A pending continuation application can be a way to draft claims covering future advances, so long as they are supported in the original parent patent application.
  • Deferring Costs and Decisions. Sometimes, an inventor needs to defer a decision or costs related to their invention. An applicant can use a continuation application to delay prosecution by “restarting” the examination timeline by abandoning the parent patent application for a continuation application with the same or similar claims.

Filing a continuation, a divisional, or a CIP application is a strategic decision that can significantly impact the strength and scope of protections your invention will receive. To learn more about continuation applications, when to file, and discuss which type is appropriate for your new invention, please contact the attorneys at The Dobrusin Law Firm.

Recently Introduced Bill Seeks to Reform PTAB and the Inter Partes Review Process to “What Congress Intended”

As the America Invents Act (AIA) marks its 10th anniversary, one of its authors has introduced new legislation to change how the AIA-created Patent Trial and Appeal Board (PTAB) conducts its business.

Sen. Patrick Leahy, along with Sen. John Cronyn, announced their “Restoring the America Invents Act” bill at the end of September to address “problems for small businesses and ordinary Americans caused by poor-quality patents.” Specifically, the bill focuses on PTAB’s inter partes review (IPR) process, which Leahy asserts lacks transparency and is too often tainted by “politicized meddling.”

The PTAB and the IPR Process

The PTAB is a tribunal within the U.S. Patent and Trademark Office with authority to review and decide the validity of patents post-grant. The IPR process, which the PTAB oversees, was designed to provide a faster and less expensive way for companies often targeted by patent infringement suits to try to invalidate patents. The system has been particularly useful in managing lawsuits filed by “non-practicing entities” (NPEs). Sometimes referred to as “patent trolls,” NPEs do not make or sell products or services that embody patents they hold.

Over the past several years, criticism of the PTAB and the IPR process has grown relating to how the PTAB exercises its discretion when making rulings, the lack of review of its decisions, and the underlying constitutional legitimacy of the Board and IPRs generally.

Proposed Reforms in the Restoring American Invents Act

If the Restoring America Invents Act becomes law in its current form, several significant changes will come to the PTAB and IPR proceedings. Perhaps the most impactful would be the limits placed on the PTAB’s ability to deny the institution of IPR proceedings, providing that “a petition that meets the requirements of this chapter shall be instituted ….” The Director would maintain limited discretion to deny or alter institution based upon multiple proceedings involving the same patent or member of the same patent family pending before the Office.

The bill would also allow the USPTO Director to review PTAB trial decisions, permit the government to challenge patents before the Board, and expand the scope of IPRs and the PTAB’s jurisdiction. The bill also encourages stays of district court proceedings involving the same patents pending PTAB review and allows for immediate interlocutory appeals of decisions denying a request for a stay. Additionally, the bill puts the burden on patent owners to prove the patentability of any amended claims and makes several changes regarding estoppel of parties and claims.

The prospects of the proposed legislation are unclear, which can be said about most bills introduced in this deeply polarized Congress. While big tech companies will lobby for the bill, it will likely be opposed by those who believe those companies already have too much power and influence over the patent landscape.

If you have questions about the Restoring America Invents Act or PTAB and inter partes review generally, please contact the patent attorneys at The Dobrusin Law Firm.

Provisional v. Non-Provisional Patent Applications: What’s the Difference?

A journey of 1,000 miles begins with the first step. So, too, does the journey of a game-changing invention. That first step is the brilliant idea, the light-bulb moment. The 1,000 miles is the long road from concept to prototype to patent. It can take a lot of time and trial and error before an inventor perfects their idea into a workable, functional product. During this time, however, the inventor can take responsible steps to protect their idea while working out their product’s kinks by filing a provisional patent application.

Buying Time, Saving Costs, and “Patent Pending”

Many inventors file a provisional application as a first step in securing patent rights because it is quicker, less expensive than filing a non-provisional application. Also, it can be submitted with basic information and images alone, as a specific format is not required.

One key benefit of a provisional patent application is that it acts as a placeholder temporarily holding an earlier filing date, up to one year, until the inventor is ready to file a non-provisional patent application. This earlier filing date can establish the non-provisional patent application’s priority date – the date used by the United States Patent and Trademark Office (USPTO) to determine if other similar written publications or filings can be considered prior art to be used against the inventor. Thus, the importance of filing quickly to secure the earliest possible priority date can be quite beneficial to beat competitors and secure rights in growing markets. The corresponding non-provisional application the inventor ultimately files will benefit from the provisional application filing date for patent protection.

Unlike a non-provisional patent application – which is the only application that can lead to issuing a patent – a provisional patent application will not be examined by the United States Patent and Trademark Office (USPTO). Instead, the provisional application gives the inventor up to 12-months to file a corresponding non-provisional application, during which time they can designate their invention as “patent pending.” The inventor can utilize this time to assess the market to determine if there is justification to move forward, continue to research, develop and refine their invention, and attempt to market and seek investors for their invention. At any time during this 12-month window, the inventor may proceed with filing the non-provisional application,

Reasons to Consider Filing a Provisional Patent Application

As noted, the requirements for filing a provisional application are much simpler and require less time and money. This is because the filing fee to be paid to the USPTO is less compared to the filing fee of a non-provisional patent application (discounted rates are available for qualifying applicants). Further, attorney fees are generally less expensive with provisional applications; because the USPTO does not examine provisional applications, they do not require extensive claims or submission in a specific format, allowing the attorney to focus their attention on disclosing the invention in as much detail as possible.

Other reasons you might file a provisional patent application include:

  • A non-provisional patent application requires an information disclosure statement, declaration, and patent claims, while a provisional application does not.
  • The USPTO never publishes provisional patent applications. After the 12-month period lapses, the provisional patent application automatically expires.
  • New matter cannot be added to a provisional application once filed. However, multiple provisional applications can be filed for the same invention to include new ideas and improvements. Thus, depending on your stage of product development, it may be wise to file a second or third provisional application to cover new subject matter not disclosed in previous applications. This allows you to benefit from the earliest possible priority date for each design and improvement when your invention isn’t ready for the full-blown non-provisional patent application. (The new subject matter will receive the priority date of the provisional application it was first described in. It is important to note that a non-provisional application is filed within 12 months of the first filed provisional application to claim priority back to each of the provisional applications).
  • An inventor could submit a provisional application on their own (but should not necessarily do so without a lawyer). A lawyer will ultimately be needed for a non-provisional application as the complexity and detail required can cause costly mistakes and delays if submitted without experienced patent counsel.

Reasons Not To File a Provisional Patent Application

While a provisional application may start the clock ticking on an invention’s patent protection, it will not get the ball rolling on the actual issuance of a patent for that invention. That is, a provisional application won’t move the patent examination and issuance process forward or get you in line for examination. If you believe that your invention is almost ready for prime time, you may want to proceed directly to filing a non-provisional application.

But if you are in the very early stages of development, it may be necessary to hold off on filing a provisional application until your invention is concrete enough to describe with adequate detail. As the USPTO recommends, the disclosure of the invention in the provisional patent application should be as complete as possible. And to receive the benefit of the filing date of a provisional application, the claimed subject matter must have support in the provisional application. Thus, a poorly drafted provisional application with little detail can be rendered useless.

These are just some issues and considerations involved in choosing between the provisional and non-provisional paths for your invention’s journey. The best way to determine how best to proceed is by consulting an experienced patent attorney. If you would like to discuss applying for a patent for your new invention, please contact the attorneys at The Dobrusin Law Firm.

The USPTO’s Track One Program Offers Many Inventors a Quicker Path to Obtaining a Patent

Inspiration for a novel invention may happen in a flash, but the process for patenting that invention certainly doesn’t. In many, if not most cases, it can take two to three years or more for the United States Patent and Trademark Office (USPTO) to complete their examination of a patent application and either grant or deny the patent. For patent applicants in a hurry, the USPTO has established an expedited process known as Track One Prioritized Examination.

Established under the America Invents Act, Track One typically allows patent applicants to obtain a final disposition on their application within about 12 months. This process is not available for all types of patent applications, and the USPTO only accepts a limited number of Track One requests each fiscal year (Oct. 1 – Sept. 30). However, because Track One has been such a popular and successful avenue for processing patent applications, the USPTO recently announced that starting with the 2021 fiscal year, it will increase the limit on Track One requests from 12,000 to 15,000.

This means that more inventors will have the opportunity to take advantage of this expedited patent application program. Here is what you need to know about Track One and whether it may be right for your patent plans.

What Patents Are Eligible for Track One Examination?

As noted, Track One allows applicants to receive a final disposition on their patent applications within approximately 12 months and grants applications special status with fewer requirements and without having to perform a pre-examination search. This is a significantly shorter time frame than the normal patent examination process.

Only utility patent applications and plant patent applications are eligible for Track One; design applications are not. A utility patent protects the functional elements of an article; that is, what it does and how it works. Plant patents are granted to inventors who invent or discover and asexually reproduce “a distinct and new variety of plant, other than a tuber propagated plant or a plant found in an uncultivated state.” A design patent protects what an article looks like, i.e., its unique appearance, such as its shape, configuration, or ornamentation.

What Is Required for a Track One Application?

To apply for a patent through the Track One Prioritized Examination Program, the petition must include:

  • A specification including claims but no multiple-dependent claims, no more than four independent claims, and no more than 30 total claims.
  • Any required drawings.
  • An executed inventor’s oath for each inventor or a signed application data sheet with the name and address for each inventor.
  • Filing, search, and examination fees.
  • A prioritized examination fee.
  • A processing fee.

You must submit all of these required items on the same day, or the USPTO will dismiss the request.

Track One applications not only take less time for the USPTO to process, but they also have higher allowance rates than regular patent applications. The USPTO has an average allowance rate of 76 percent, but 87 percent of approved Track One applications receive a notice of allowance that a patent will be granted. While these are certainly attractive aspects of Track One, they come with a higher price since the required fees are substantially greater than for an application that is not prioritized.

To learn more about the Track One program and explore whether it is right for your invention, please contact the attorneys at The Dobrusin Law Firm.

Client Alert: Scammers Targeting IP Owners With Fake Fee Notices

It seems that around every corner lately, a scam awaits.  Well, the same can be said as it relates to the patent and trademark world. Patent and trademark owners don’t want to inadvertently lose their valuable intellectual property rights because they failed to pay required maintenance fees or file necessary paperwork with the U.S. Patent and Trademark Office (USPTO) or the World Intellectual Property Organization (WIPO). However, scammers frequently prey on IP owners’ fears by sending them fake notices and “invoices” and fleecing them for unnecessary and fraudulent payments. Some of these documents even have CANCELLATION in bold letters across the top; of course, you’re going to pay attention, right?

Both the USPTO and WIPO recently issued alerts warning patent and trademark owners of these scams. As the USPTO advises, these notices come from private companies unaffiliated with the agency. They attempt to look official “because they contain information taken from public records available on the USPTO’s databases,” incorporate cautionary language such as “patent cancellation notice” or “important notification regarding your federal trademark,” or include “U.S.” or “United States” in the company name and letterhead.

Similarly, WIPO recently published a warning that “PCT applicants and agents are receiving invitations to pay fees that do not come from the International Bureau of WIPO and are unrelated to the processing of international applications under the PCT.” As with the USPTO fee scams, the fake WIPO notices mimic official-looking ones by containing detailed information about a PCT application such as its international publication number, publication date, title of the invention, international application number, priority information, and IPC symbols.

If you hold a U.S. patent or trademark, you can avoid these scams and help stop them by being alert to the following advice.

  • All official correspondence about your U.S. patent or trademark will come from the “United States Patent and Trademark Office” in Alexandria, Virginia, with zip code 22313 or your attorney of record
  • Official emails from the USPTO will be from the domain “@uspto.gov.”
  • If you receive any notices concerning your U.S. patent or trademark that do not come from the USPTO’s address and ask you to remit payment to an address that is not the USPTO’s, you are dealing with a private company.
  • You can verify maintenance requirements for your patent or trademark registration and check if fees are due on the USPTO’s website. The site includes a portal where patent owners can find due dates for maintenance fees.
  • You can make required fee payments directly to the USPTO yourself or with assistance from your lawyer or registered patent practitioner.
  • If you receive a solicitation about your patent or trademark you believe is deceptive, you may file an online consumer complaint with the Federal Trade Commission (FTC) or by contacting independentinventor@uspto.gov.
  • If you are unsure contact the USPTO directly or check in with your attorney.

If you are an American PCT applicant and believe you have received a fraudulent fee notice, WIPO also recommends that you report it to the FTC. Applicants from other member countries should report their complaints to their own country’s consumer protection agency.

If you have questions about patent or trademark maintenance fees or have concerns about a recent notice, please contact the attorneys at The Dobrusin Law Firm.

“Inside Out” Copyright Infringement Lawsuit Should Animate All Creators to Obtain Copyright Registration for Their Works

Joy, Sadness, Anger, Fear, and Disgust were the five personified emotions felt by a young girl named Riley in the animated 2015 Disney/Pixar blockbuster “Inside Out.” A Canadian filmmaker who is likely filled with anger and disgust at the makers of the movie may feel a bit of joy now that a Canadian court has allowed his copyright infringement lawsuit to proceed in part.

It turns out that 20 years ago, well before the release of the hit movie, a then-film student in Ontario made a short film about a young boy named Lewis whose behavior was controlled by five personified organs – the Brain, Stomach, Colon, Bladder, and Heart. The film was called “Inside Out.”

There are striking similarities between the two movies, extending beyond its title, broad themes, and narrative concept to many other details shared by both films. Along with allegations that Disney/Pixar likely was aware of his 14-minute short film, these similarities led to the filmmaker’s lawsuit alleging that Disney/Pixar deliberately ripped off his movie without credit, compensation, or consent.

“It is clear that the Infringing Work (the Pixar movie) reproduces the inventive and central concept at the heart of the Original Works: the behavior and actions of the main “external” character, a school-age child, are controlled by five “internal” characters who work together and struggle against one another to help the external character navigate his or her daily life,” the plaintiff claims in his suit.

This dispute is hardly the first high-profile copyright infringement lawsuit involving allegations that a famous movie, song, or other creative work was wrongfully appropriated from a previous work. A few years ago, for example, a court ordered Robin Thicke and Pharrell Williams to pay over $5 million to the family of Marvin Gaye after finding that their 2013 hit “Blurred Lines” was taken directly from Gaye’s 1977 song “Got to Give It Up.”

Copyright Registration Is the Key to Recovering Damages for Infringement

These cases, along with countless others that don’t make headlines, illustrate the consequences of copyright infringement for authors of creative works and those who seek to capitalize on their ideas unlawfully. They also serve as a reminder of how important it is for creatives to obtain federal copyright registrations for their original ideas as soon as possible, whether in writing, on the screen, on canvas, in recordings, or pieces of software.

Even though qualifying works are copyrighted the moment they are created and fixed in a tangible form, registration in the Copyright Office provides rights and remedies to stop the infringement and recover substantial damages. According to the Copyright Act of 1976, 17 U.S.C. § 411, a copyright owner cannot bring a lawsuit for infringement until “registration of the copyright claim has been made in accordance with” the Act.

Other Benefits of Copyright Registration

In addition to being a prerequisite for recovering infringement damages, copyright registration offers several critical benefits, including:

  • Acting as a public record of the creator’s copyright claim, thus countering any defense that the infringement was innocent.
  • Serving as prima facie evidence of the copyright’s validity if registered within five years of publication or being fixed in a tangible form.
  • Recovering statutory damages and attorney’s fees if the creator obtains a registration within three months of publication or prior to an infringement of their work. Otherwise, only an award of actual damages and the defendant’s profits are available as compensation.
  • Allowing U.S. Customs and Border Protection, upon receipt of a copyright registration certificate, to bar the importation into the U.S. of pirated or counterfeit works.

At The Dobrusin Law Firm, we help creators of all types protect their works and maximize the value and benefits of sharing their ideas with the world. If you have questions or need assistance with copyright registration, please contact us day to arrange a consultation.

IPR Decisions Now Reviewable by Director of Patent Office After Supreme Court Fixes Constitutional Defect With PTAB Judges

In a much-anticipated decision involving the constitutionality of the Patent Trial and Appeal Board (PTAB), the Supreme Court ruled in U.S. v. Arthrex that the appointment of PTAB administrative patent judges (APJs) by the secretary of commerce violated the Constitution’s Appointments Clause. But rather than throw the entire inter partes review process and all other matters handled by PTAB into disarray, the Court also fixed the constitutional defect in the same ruling.

“Unreviewable Authority”

In Arthrex, the court addressed the issue of whether PTAB judges are “Officers of the United States” under the Appointments Clause, and if so, whether they are “inferior” officers who do not require a presidential appointment or “principal” officers who do. Noting that neither the secretary of commerce nor the director of the U.S. Patent and Trademark Office (USPTO) had the power to review decisions by APJs, the Court held that “the unreviewable authority wielded by APJs during inter partes review is incompatible with their appointment by the Secretary of Commerce to an inferior office.”

The Federal Circuit had previously reached a similar conclusion, holding that PTAB judges were “principal” officers because of their lack of supervision by any presidentially appointed officials and statutory provisions that limited those officials’ power to review PTAB judges’ final decisions as well as their ability to remove judges without cause.  The court then immediately converted PTAB judges into constitutionally acceptable “inferior” officers by severing a portion of the Patent Act relating to removal protections, thus allowing PTAB judges to be removed without cause.

This result satisfied none of the parties involved, all of whom sought, and did not receive, a rehearing en banc by the full Federal Circuit before each filing a petition for certiorari.

IPR Rulings Now Reviewable By The Director of the Patent Office

While the Supreme Court in Arthrex agreed with the Federal Circuit that APJ’s were constitutionally deficient, they chose a different approach to remedying the issue. Joined by Justices Alito, Kavanaugh, Breyer, Barrett, Kagan, and Sotomayor, Chief Justice Roberts concluded that the only appropriate solution was to make PTAB decisions reviewable by the Director of the Patent Office, thus making APJs subject to a superior officer on the issue of patentability.

Notably, the Court’s opinion only addressed inter partes review proceedings and not reviews of patent examinations.

USPTO Issues Interim Guidance In Response to Arthrex

In response to the Arthrex decision, the USPTO implemented an interim procedure for Director review of PTAB decisions. Specifically, a review may be initiated sua sponte by the Director or requested by a party to a PTAB proceeding. Parties may request that the Director review a final written decision in an inter partes review or a post-grant review by concurrently:

  • Entering a Request for Rehearing by the Director into PTAB E2E; and
  • Submitting a notification of the Request for Rehearing by the Director to the Office by email to Director_PTABDecision_Review@uspto.gov, copying counsel for all parties by email.

If you have questions about the Arthrex decision or about inter partes review generally, please contact the patent attorneys at The Dobrusin Law Firm.

What President Biden’s Recent Executive Order on Promoting Competition Means for IP

On July 9, 2021, President Joe Biden issued a sweeping executive order authorizing and facilitating a “whole of government approach” designed to promote competition and innovation, reduce marketplace consolidation, and protect the interests of workers, farmers, consumers, and small business owners.

The “Executive Order on Promoting Competition in the American Economy” touches upon almost every aspect and sector of the economy, including intellectual property development, ownership, and rights. Here is what IP owners should know about President Biden’s order and its potential implications for their inventions, intellectual property portfolios, and businesses.

Intersection of IP and Antitrust Laws

As one would expect in an order “promoting competition,” there is a significant focus on antitrust and anti-monopoly laws and policies. In the intellectual property context, the order emphasizes steps to “avoid the potential for anticompetitive extension of market power beyond the scope of granted patents, and to protect standard-setting processes from abuse.”

The order goes on to state that, “the Attorney General and the Secretary of Commerce are encouraged to consider whether to revise their position on the intersection of the intellectual property and antitrust laws, including by considering whether to revise the Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitmentsissued jointly by the Department of Justice, the United States Patent and Trademark Office, and the National Institute of Standards and Technology on December 19, 2019.”

Generics and Biosimilars

The order sets forth the administration’s goal of reducing prescription drug prices and its perspective that “too often, patent and other laws have been misused to inhibit or delay — for years and even decades — competition from generic drugs and biosimilars, denying Americans access to lower-cost drugs.”

In addition to supporting “aggressive legislative reforms that would lower prescription drug prices,” the order directs the Federal Trade Commission Chair to consider adopting rules to address “unfair anticompetitive conduct or agreements in the prescription drug industries, such as agreements to delay the market entry of generic drugs or biosimilars.”

Agricultural Patents

“To help ensure that the intellectual property system, while incentivizing innovation, does not also unnecessarily reduce competition in seed and other input markets beyond that reasonably contemplated by the Patent Act,” the order directs the Secretary of Agriculture to submit a report “enumerating and describing any relevant concerns of the Department of Agriculture and strategies for addressing those concerns across intellectual property, antitrust, and other relevant laws.”

There are many other matters addressed in the order that do not involve intellectual property per se but could impact intellectual property-focused businesses and industries. This includes, for example, encouraging the FTC Chair to consider rules that would “curtail the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit worker mobility.”

To learn more about the provisions of President Biden’s Executive Order or ask questions about how it may implicate your intellectual property interests, please contact the attorneys at The Dobrusin Law Firm.

Utility Patents v. Design Patents: What’s the Difference, and Which One Is Right for You?

“Form follows function” is a famous axiom in the world of architecture. In the world of patents, form and function are the defining characteristics that separate two distinct types of patents: utility patents and design patents.

Both utility and design patents provide valuable protections for patent owners, but there are significant distinctions between them. Determining which is best suited for your invention will affect what your patent protects, how much the application process will cost, and when and whether the U.S. Patent and Trademark Office (USPTO) will issue your patent.

If you are an inventor or entrepreneur seeking the rights and protections a patent provides, here is what you need to know about utility and design patents.

Utility Patents

A utility patent protects the functional elements of an article; that is, how it is used and works. To obtain a utility patent, the invention must be “novel, non-obvious and useful.”

Those three terms have very specific meanings in patent law, and if your invention does not hit all those marks, the USPTO may deny your application for a utility patent.

  • Novel: You cannot patent an invention that already exists. An article must not have been known or used by others before the inventor created it. However, improvements to an existing invention may be patentable.
  • Non-Obvious: Even if an invention differs from an existing invention so that it is “novel,” a patent will not be issued if that difference is obvious “to a person having ordinary skill in the art to which the claimed invention pertains.” Determining whether an invention is obvious involves several complex factors and can be a very involved aspect of the patent prosecution process.
  • Useful: You cannot obtain a patent for an item that doesn’t actually do anything. A claimed invention must have a “specific and substantial utility.”

Design Patents

Many patentable items will not only do something; but will look like something. A design patent protects what an article looks like, i.e., its unique exterior appearance, such as its shape, configuration, or surface ornamentation. For example, you could obtain a design patent for a new shoe tread, car design, or beverage container shape. The key for a design patent is that it relates to a visible, exterior aspect of the invention.

Other Key Differences Between Utility and Design Patents

Utility and design patents not only cover different aspects of an article, but the application process and protection each type of patent provides are distinct.

Typically, utility patents are much more difficult to obtain, and the USPTO’s review process of a utility application can take much longer than for a design application. The analysis involved in determining whether the functional aspects of an article satisfy all of the elements required for a utility patent includes a great deal of detailed, scientific, and technical analysis compared to reviewing an item’s ornamental appearance for a design patent.

That is why the typical pendency of a utility application is about two to three years, while the pendency of a design patent application is about one to two years.

Utility patents are valid for generally 20 years from the application filing date, while design patents are valid for generally 15 years from the date of patent issuance. And while a utility patent owner must pay periodic maintenance fees to prevent patent expiration, no additional maintenance fees are required to maintain a design patent.

Which Type of Patent Is Right for Your Invention?

You can apply for both a design and utility patent for an article if the invention’s novelty resides both in its utility and its ornamental appearance. Given the lengthier and costlier application process for utility patents, many inventors move forward with only a design patent application. The best way to determine your patent prosecution strategy is to meet with an experienced patent attorney.

If you would like more information about utility and design patents or would like to discuss applying for a patent for your new invention, please contact the attorneys at The Dobrusin Law Firm.

The Decision to Deny Institution of IPR Is Non-Appealable Except in Extraordinary Circumstances, Federal Circuit Rules

The Federal Circuit recently ruled it has no jurisdiction to review decisions of the Patent Trial and Appeal Board (PTAB) denying institution of inter partes review (IPR) proceedings, except in the extraordinary circumstance where a writ of mandamus is justified. The decision in Mylan Laboratories Ltd. v. Janssen Pharmaceutica, N.V., effectively means that, in most cases, PTAB’s denial of an IPR petition is the end of the road for patent challengers who want to pursue that potential remedy.

Procedural Background

In 2019, Janssen sued Mylan in district court for infringement of a schizophrenia drug patent. While that case was pending, Mylan filed a petition with PTAB for institution of IPR of the biomedical technology patent at issue. The Board denied Mylan’s petition, basing its decision on its six-factor standard for evaluating whether to deny institution given earlier trial dates in co-pending district court proceedings regarding the same drug patent. Trial dates were rapidly approaching in co-pending litigation, which substantially overlapped with the issues raised in the IPR petition, including the second suit in which Mylan was not a party.

Mylan appealed the Board’s decision, asserting that the denial of institution based on the timing of a separate district court litigation to which Mylan was not a party violated Mylan’s constitutional and due-process rights. It also claimed that “the Board’s continued adoption and application of non-statutory institution standards through ad hoc proceedings lie in contrast to congressional intent.” On the same grounds, Mylan also requested mandamus relief.

The Federal Circuit granted Janssen’s motion to dismiss the appeal for lack of jurisdiction. The court based its decision by squaring the language in its general grant of jurisdiction under federal statute.

IPR Decisions: Appealable. Decisions Denying Institution of IPR: Non-Appealable.

28 U.S.C. § 1295(a)(4) provides that the court “shall have exclusive jurisdiction . . . of an appeal from a decision of [the Board] with respect to . . . inter partes review . . .“ However, 35 U.S.C. 314(d) states that “the determination by the Director whether to institute an inter partes review under this section shall be final and non-appealable.”

Based on the statutory construction rule that a more specific provision prevails over a broader one, the court concluded that, taken together, “those statutes preclude direct appeal from a decision denying institution.”

“At a first glance, the ‘appeal from a decision’ language in § 1295(a)(4) seems broad, perhaps broad enough to reach an appeal from a decision denying institution,” the court wrote. “But § 314(d), the more specific statute, dispels any such notion… Section 314(d) prevents ‘appeal’ from a decision denying institution. Without the ability to ‘appeal,’ parties cannot make use of § 1295(a)(4)’s jurisdictional grant.”

However, the Federal Circuit found it did have jurisdiction to review IPR denial decisions under a petition for mandamus under extraordinary circumstances. After considering Mylan’s mandamus petition on the merits, the court concluded that it had not met the extremely high bar required for mandamus relief.

If you have questions about the Mylan decision or about inter partes review generally, please contact the patent attorneys at The Dobrusin Law Firm.

Misconception of Artificial Intelligence

As artificial intelligence has evolved, a number of questions related to intellectual property have been pondered relative to the creation of intellectual property by an AI system and the resulting property ownership, if any. Such questions have been asked for a few decades. However, until recently they have mostly been hypothetical questions.

When a work of art is created by an individual, intellectual property rights may be obtained via copyright protection. Copyright protection is available for a broad range of creative endeavors including publications, paintings, photographs, musical scores and recordings, video recordings, theatrical productions, and software code. Similarly, when individuals invent or discover something new and useful, intellectual property rights may be obtained via a patent.

When filing a patent application in the US, it is necessary to indicate the inventorship of the patent. This requirement flows from 35 U.S.C. § 101, which states:

35 U.S.C. § 101 INVENTIONS PATENTABLE.
Whoever 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 therefor, subject to the conditions and requirements of this title.

What happens when the AI system invents or discovers something new and useful?

The U.S. Patent and Trademark Office has weighed in on this question, after a patent application (US 16/524,350) was filed on July 29, 2019 listing the following sole inventor:

Given Name: DABUS
Family Name: Invention generated by artificial intelligence

On April 22, 2020, the USPTO issued a final decision ruling that the term “Whoever” in 35 U.S.C. § 101 refers to a “natural persons”. As DABUS is not a natural person, it cannot be listed as an inventor.

This interpretation is consistent with other sections of patent law, including 35 U.S.C. § 115 which requires the inventor to file an oath or declaration:

35 USC § 115 INVENTOR’S OATH OR DECLARATION
(a) NAMING THE INVENTOR; INVENTOR’S OATH OR DECLARATION.—An application for patent that is filed … shall include, or be amended to include, the name of the inventor for any invention claimed in the application. … each individual who is the inventor or a joint inventor … shall execute an oath or declaration in connection with the application.
(b) REQUIRED STATEMENTS.—An oath or declaration under subsection (a) shall contain statements that—
(1) the application was made or was authorized to be made by the affiant or declarant; and
(2) such individual believes himself or herself to be the original inventor or an original joint inventor of a claimed invention in the application ….

From 35 U.S.C. § 115, it is clear that an inventor cannot be an AI system or other machine. An AI system is not an “individual”. An AI system cannot execute an oath or declaration. An AI system cannot make a patent application or authorize one to be made. An AI system cannot believe that it is an inventor.

The USPTO also considered case law which identifies that inventors are the individuals that conceive of the invention.

“Conception is the touchstone of inventorship, the completion of the mental part of invention.” Burroughs Wellcome Co. v. Barr Labs., Inc., 40 F.3d 1223 (Fed. Cir. 1994).

Because of the mental act of conception, it follows that only individuals can be inventors.

The Applicant also painted himself into a corner, by stating that DABUS is the true inventor and then arguing that “the referenced statutes are intended to compel an applicant to name a natural person even where the person does not meet the inventorship criteria.” The USPTO responded by clearly stating that “the petition decision … does not suggest that an applicant is compelled to list a natural person who does not meet the inventorship criteria.”

This is a clear indication that the USPTO will not grant a patent when the true inventor is an AI system or other machine. Applicant cannot now list an individual as the inventor because it has admitted that the true inventor is DABUS. If the Applicant wants to prosecute this patent application, it may consider amending the claims so that an individual can truthfully submit the necessary inventor’s oath or declaration attesting to inventorship, as required by 35 U.S.C. § 115.

The “DABUS” patent application was also filed with the European Patent Office (EP3563896) and with the United Kingdom Patent Office. These patent offices are also taking the position that an inventor for purposes of obtaining patent protection must be an individual.

Although DABUS may be the true inventor, at least three patent offices have indicated that patent rights will not be granted unless the inventor is an individual.

In copyright law, protection similarly requires that the rights be granted only to individuals for their creative work.

An interesting example is the project, “The Next Rembrandt”, where an AI system was used to analyze about 300 works by Rembrandt and then create a new portrait. The AI system created a portrait that most art experts agree could pass as a Rembrandt work. The general consensus is that although such a work of art may be generated or produced by an AI system, the AI system is only building on the creativity of others. The Next Rembrandt may be considered as a derivative work based only from Rembrandt, and such derivative works are generally not allowed the benefits of intellectual property protection.

For example, in the UK, the Copyright, Design, Patent Act of 1988 defines: “Computer-generated”, in relation to a work, means that the work is generated by computer in circumstances such that there is no human authorship of the work. The act also requires that for protection, the authorship must be an individual.

When copyright protection was offered for photographs, it was determined that such protection is appropriate due to the free and creative choices made by the photographer. The photographer determines the frame (boundaries) of the photograph, the elements being captured and excluded, and making other choices. If a monkey cannot own a copyright for a selfie that it took, then how could a machine be granted copyright protection? Maybe this will be revisited when an AI system is developed that has free and creative choices.

– By Terry Finerman

Photo Credit: nextrembrandt.com

Can Patent Trolls Impact COVID-19 Testing and Treatment?

Even though patent protection has evolved over the years, 35 U.S.C. § 261 has always dictated that “patents shall have the attributes of personal property.” As a result, patents can be traded, licensed, purchased, sold, and transferred just like any other piece of property. However, due to patents being considered property – albeit intangible intellectual property – they can be treated like a commodity. The effect is a substantial dichotomy between two fundamental groups of patent owners: practicing entities, such as manufacturing companies; and non-practicing entities.

Non-practicing entities, more commonly known as patent trolls, are an individual or a firm that purchases a portfolio of patents and asserts the rights of those patents without ever creating or manufacturing a product using the patented technology. The exploitation of patents by patent trolls is a frequent point of contention. Scholars and practitioners alike argue that the use of patents by those not actually creating or manufacturing a product based on their patents goes against the very fabric of patent law. Additionally, these patent trolls have the potential to significantly burden development by other companies with threats of litigation and exorbitant licensing fees. But surely these patent trolls would not act in arguably bad faith in a true time of need, would they?

Here we are in 2020 fighting a pandemic. Pharma companies worldwide are furiously working to find a cure or treatment for COVID-19. Companies have already begun offering their technology for public use, including the likes of AbbVie, which announced it would not enforce its patent rights on the HIV drug Kaletra, and Gilead that sought to rescind its seven-year orphan drug exclusivity period for remdesivir. Yet even with such urgency to battle COVID-19, some patent trolls are still seeking to exploit the situation.

Labrador Diagnostics LLC, a subsidiary of the fund manager Fortress Investment Group LLC, filed a lawsuit on March 9 against BioFire Diagnostics, LLC, a company deeply involved in developing coronavirus tests. To add insult to injury, the patents Labrador sought to enforce were originally issued to the company Theranos, a company that shut down in 2018 in the midst of many claiming Theranos was conducting fraudulent blood testing. While Fortress recently announced that Labrador will grant royalty-free licenses for COVID-19 testing, the decision came only after extensive backlash and awful publicity forced its hand.

So what is stopping other patent trolls from asserting patent rights against companies currently developing and testing products to combat COVID-19? The short answer is nothing. But that does not necessarily mean these trolls can get away with their exploitations in a time of undeniable need.

The U.S. government may still hold the trump card over companies like Labrador. 28 U.S.C. § 1498 states that when any invention covered by a U.S. patent “is used or manufactured by or for the United States without license of the owner thereof… the owner’s remedy shall be by action against the United States… for recovery of his reasonable and entire compensation for such use and manufacture.” In other words, a patent owner, such as a patent troll, may only be able to sue for reasonable compensation and not seek injunctions against private entities working for the United States government.

While actions were not taken against Labrador based on 28 U.S.C. § 1498, it may stand to reason that the U.S. government could have invoked its power and shielded BioFire from injunction. The U.S. government could authorize BioFire to act on its behalf to develop much-needed COVID-19 tests. As a result, any forthcoming patent infringement suits would need to make the U.S. government the defendant.

Yes, pharmaceutical affordability and accessibility based upon patent rights are still significant hurdles to overcome when addressing COVID-19 cures and treatments, but as may be gleaned from the actions of Labrador, potential patent hurdles may extend well beyond just affordability and accessibility of drugs.

It is unlikely that disputes will stop between patent trolls and companies battling COVID-19. Yet there may be a way to ensure those disputes do not dictate the actions of these companies. But, at least for now, we are left to guess whether the U.S. government will interject themselves and assert authority that has rarely been used thus far.

– By Bryan Lemanski

Pharma Intellectual Property and COVID-19

Opinions abound regarding pharmaceutical patents, with some arguing that patent protection is needed to encourage innovation and allow for recouping of development costs, and others arguing that patents lead to skyrocketing prices and unaffordable health care. Regardless of viewpoint, there is no question patents are valuable to the pharmaceutical companies that own them. It is estimated that patents contribute to roughly 80% of the overall revenue of drug companies.

Currently, scientists, researchers, and drug manufacturers are racing to find a cure or a treatment for COVID-19, including turning to existing medicines used to treat other viruses. Drug manufacturers, while offering potential COVID-19 therapies, are taking vastly different approaches with respect to their intellectual property portfolios.

AbbVie announced last month that it was supporting the experimental use of its HIV medicine Kaletra (also sold as Aluvia in some markets) to address the COVID-19 public health crisis. Collaborating with the FDA, CDC, and NIH and European health authorities, among others, AbbVie is supporting clinical studies and basic research with lopinavir/ritonavir (Kaletra/Aluvia) to determine its efficacy in treating COVID-19.

In addition, the drug company announced that it would not enforce patent rights to Kaletra. This decision would allow generic drug producers to increase production to make the medication more readily available, should the drug be found effective.

While a study published in The New England Journal of Medicine found that “no benefit was observed with lopinavir–ritonavir treatment beyond standard care,” it is still worth noting that AbbVie is the first pharmaceutical company to take such a bold stance in choosing not to enforce its patent rights on all formulations of the HIV medication while it is being evaluated.

Several clinical studies are also underway to evaluate the safety and efficacy of remdesivir, an experimental drug from Gilead Sciences, in adults diagnosed with COVID-19. This comes after the FDA accepted Gilead’s investigational new drug (IND) filing. However, due to “overwhelming demand,” the company temporarily stopped granting patients access to remdesivir.

Remdesivir was granted “orphan drug status” by the FDA in February 2020. Under the 1983 Orphan Drug Act, pharmaceutical companies are given a seven-year market exclusivity period for developing treatments for “rare disease.” Through this orphan drug status, Gilead can, therefore, block generic drug manufacturers from supplying the drug.

While potential benefits and risks of treatment with remdesivir for COVID-19 are not yet known, it stands to reason that if remdesivir is found to be effective, a patent “may prove to be a blockbuster hit for its patent owner,” leading someto wonder whether it is not only the overwhelming demand keeping Gilead from allowing its experimental drug to be made widely available.

Public backlash has also perhaps made some entities change their minds about pursuing patent infringement suits at this time.

Labrador Diagnostics LLC, owning patents from the now-defunct health technology company Theranos, sued BioFire, a company making COVID-19 tests, for patent infringement. Shortly after reports surfaced of the lawsuit—described as “the most tone-deaf IP suit in history” by Mark Lemley, director of the Stanford Law School Program in Law, Science and Technology—Labrador announced that it would grant royalty-free licenses for COVID-19 testing, asserting that “the lawsuit was not directed to testing for COVID-19.”

– by Katherine Pacynski

Intellectual Property Updates From the United States, Europe, China, and Canada

As we continue to be affected by the COVID-19 outbreak, Intellectual Property Offices around the world are extending deadlines or making other exceptions to accommodate the challenges inventors and business owners are currently facing. If you have upcoming deadlines and are concerned about being able to meet them due to refocusing or shifting priorities, we highly recommend speaking with your attorney to see if a deadline extension may be applicable.

While subject to change, here’s what some of the Offices are saying:

United States Patent and Trademark Office

March 31, 2020 – “The United States Patent and Trademark Office (USPTO) today announced extensions to the time allowed to file certain patent and trademark-related documents and to pay certain required fees. These actions are an exercise of temporary authority provided to the USPTO by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) signed by President Trump on March 27.”

In addition to the relief provided under the CARES Act for certain due dates between, and inclusive of, both March 27, 2020 and April 30, 2020, the USPTO has previously waived the fee under 37 C.F.R. §1.17(m) for petitions to revive applications, when applicants were unable to timely reply to an office communication due to the COVID-19 outbreak, as described in the Office’s March 16, 2020 notice.

March 16, 2020 – “The United States Patent and Trademark Office (USPTO) considers the effects of coronavirus to be an “extraordinary situation” within the meaning of 37 CFR 1.183 and 37 CFR 2.146 for affected patent and trademark applicants, patentees, reexamination parties, and trademark owners. Therefore, the USPTO is waiving petition fees in certain situations for customers impacted by the coronavirus. This notice does not grant waivers or extensions of dates or requirements set by statute.”

European Patent Office

March 15, 2020 – “In view of the disruptions to public life caused by the COVID-19 outbreak, the EPO has taken measures to safeguard users’ rights. All time limits expiring on or after 15 March 2020 are thus extended until 17 April 2020. As regards time limits expiring before 15 March 2020, the EPO has facilitated the use of legal remedies for users located in areas directly affected by disruptions due to the COVID-19 outbreak. The extensions and remedies apply to parties and representatives in proceedings under the EPC and the PCT. The following notice provides all relevant information and will be published in the EPO’s March Official Journal. If the disruption should continue after 17 April 2020, the EPO may publish another notice informing users about further extensions and remedies in respect of time limits.”

March 30, 2020 – “The extension of time limits also applies to periods for paying fees, including renewal fees. The following notice contains information about the amounts due following the general fee increase on 1 April 2020. This notice will be published in the April edition of the EPO’s Official Journal.”

China National Intellectual Property Association

January 28, 2020 – CNIPA announced that patentees and applicants can restore their patent rights without payment of a restoration right request fee if lost rights were due to the coronavirus. Applicants and patentees need to submit a request for the restoration of the right, explain the reason, attach the corresponding certification materials, and go through the corresponding formalities before the loss of rights.

March 4, 2020 – CNIPA will waive late fees for missed patent annuity payments if the reason can be traced back to the COVID-19 epidemic.

March 27, 2020 – CNIPA confirms missed deadline policies apply to non-Chinese applicants

Canadian Intellectual Property Office

March 27, 2020 – The CIPO announced that all deadlines on IP matters that fall before 30 April 2020 are now extended until 1 May 2020. A further extension could occur depending on circumstances, the registry added.

Supreme Court Decision Raises Questions About the Authority of USPTO Administrative Judges

Recently, the U.S. Supreme Court addressed the authority of illegally appointed administrative judges, and though the decision did not speak to questionable appointments at the U.S. Patent & Trademark Office (USPTO), there may be implications for individuals and organizations holding, prosecuting, and protecting patents.

Lucia and the Appointments Clause

In Lucia v. Securities Exchange Commission, Raymond Lucia with charged with violating particular securities laws. Cameron Elliot, an administrative law judge (ALJ) with the SEC, was assigned to adjudicate the case and later imposed sanctions against Lucia. Lucia appealed the decision, claiming that the administrative proceeding was invalid because Elliot had not been “constitutionally appointed” pursuant to the Appointments Clause in Article II of the U.S. Constitution:

“[The President] shall nominate, and by and with the advice and consent of the Senate, shall appoint… judges of the Supreme Court, and all other officers of the United States, whose appointments are not herein otherwise provided for….”

Lucia argued that SEC ALJs are “Officers of the United States” and only the President, “Courts of Law,” or “Heads of Departments” can appoint such them – none of whom appointed Elliot. The case made its way to the U.S. Supreme Court, where seven of the nine justices agreed, finding that, although SEC ALJs are “Officers of the United States,” Elliot lacked authority and overturning the sanctions against Lucia.

The Appointments Clause and the USPTO

Why does the Lucia decision pose any threat to the authority of administrative law judges at the USPTO? Consider the impact if Lucia applies equally to the USPTO, the SEC, and other federal agencies.

When the result of a patent examination is unfavorable to the Applicant, the Applicant may appeal the Examiner’s decision to the Patent Trial & Appeals Board (PTAB), which then reviews the case and issues a binding decision. Within the PTAB’s branched hierarchal structure, the first tier includes a Chief Administrative Patent Judge (Chief Judge) and Deputy Chief Judge who decide petitions or may delegate authority to decide petitions. The second tier has two divisions of judges and attorneys led by a Vice Chief Judge, and under them are a variety of judges in different “sections.” each focusing on certain technical disciplines.

It is well established that the Director of the USPTO is an officer appointed by the President, consistent with the edicts of the Appointment Clause, and the U.S. Patent Act mandates states that “administrative patent judges shall be persons of competent legal knowledge and scientific ability who are appointed by the Secretary [of Commerce], in consultation with the Director.”

In Lucia, the Supreme Court found that SEC administrative judges are officers (rather than employees) and thus subject to the Appointments Clause. The Court identified that to qualify as an officer, an individual must (1) occupy a “continuing position established by law”; and (2) exercise “significant authority” pursuant to the laws of the U.S., according to the case law precedents.

It would seem that PTAB judges qualify as officers since they both occupy a continuing position, the position is established by law, and the judges have significant authority in the ability to make final rulings on the intellectual property rights of U.S. citizens. Furthermore, the function of PTAB judges substantially mirrors the qualities of SEC administrative judges as described in Lucia.

Are PTAB Administrative Judges “Inferior” or “Principal” Officers?

A subsequent provision in the Appointments Clause specifically references “inferior” officers, and gives Congress the legal authority, by statute, to delegate the power to appoint only inferior Officers to heads of departments (i.e., the Secretary of Commerce):

“Congress may by law vest the appointment of such inferior officers, as they think proper, in the President alone, in the courts of law, or in the heads of departments.”

While there has been generally sparse instruction on how to draw the distinction, Intercollegiate Broadcasting v. CRB, a Federal Circuit case, summarized three factors relevant to the inferior versus principal inquiry:

(1) the degree of supervision over the officer in question by a principal officer or those in the principal officer’s supervisory line; (2) whether the officer in question is removable without cause; and (3) whether the decisions rendered by the officer in question are reversible.

An example of how these criteria are considered can be found in Estes v. U.S. Dept. of the Treasury, which ruled that the three factors are not weighted independently and equally – strength in one can offset weakness in another. For instance “the power to remove officers… is a powerful tool for control” (indicating an inferior officer) and overpowers other factors such as an officer who maintains a high degree of autonomy (evidence tending to suggest a principal officer).

Degree of Supervision: It is unclear how the Secretary of Commerce supervises or directs the decisions of the Chief Judge, if at all. It is also unclear to what extent decision making is delegated. Considering the volume of cases, the degree of technical skill required of a judge, the number of judges and attorneys, and the level of hierarchical fractioning, it would seem nearly impossible for the Secretary of Commerce to exert any substantive control over the operation of the PTAB. Thus, it is probably safe to say that PTAB judges lean strongly toward the side of principal officers as they exercise a high level of independence.

Removable Without Cause: Although USPTO employment policies regarding PTAB judges are not helpful, it is safe to assume that the judges, who are chosen internally from Examiners or from extensively experienced legal patent professionals, would not be treated as expendable employees or dismissible without cause. The requisite skill required of these judges suggests that the USPTO does not have an appreciably large pool of applicants to draw from – hinting at an organizational aversion to turnover.

In Question or Reversible Decisions: Decisions regarding petitions are final within the USPTO. Applicants may seek post-decision relief in an appeal to the Federal Circuit. While technically, PTAB judge decisions are “reversible” on appeal, even federal district and circuit court judges’ decisions are appealable to a higher authority (both types of judges are appointed by the President). Thus, the fact that a PTAB judge’s decision can be appealed to a federal district court does not seem like a disqualifying characteristic for being considered a principal officer. “In question or reversible” likely refers to whether the bona fide principal officer (the Director or the Secretary of Commerce) can alter the decision of a PTAB judge. As it stands at the USPTO, the Director nor the Secretary of Commerce has any such power.

The Big Picture

As clarified by Lucia, PTAB judges are likely officers, and under the Intercollegiate framework, they are likely principal officers. Thus, there is a very strong argument that the Patent Act illegally confers the appointment of administrative patent judges to the Secretary of Commerce where their appointments should only flow from the President.

Lucia made waves in the arena of administrative law and those waves may splash over into the hallways of the USPTO. A Supreme Court ruling like Lucia will surely embolden those eagerly waiting for the opportune time to bring suit. What chaos might follow such a paradigm shift? The Court in Lucia overturned the decision of the SEC administrative judge so the likely result of a constitutional challenge of the Patent Act would be a whole host of invalidated decisions and retrials by properly appointed PTAB judges.

– by Eric Hydorn

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