Federal Circuit Update Archives

This edition of Gibson Dunn’s Federal Circuit Update discusses recent Federal Circuit decisions concerning pleading requirements, obviousness, and more Western District of Texas venue issues. Also this month, the U.S. Senate voted to confirm Tiffany P. Cunningham to be United States Circuit Judge for the Federal Circuit and Federal Circuit Judge Kathleen O’Malley announced her retirement.

Federal Circuit News

Supreme Court:

The Court did not add any new cases originating at the Federal Circuit.

The following petitions are still pending:

Biogen MA Inc. v. EMD Serono, Inc. (U.S. No. 20-1604) concerning anticipation of method-of-treatment patent claims. Gibson Dunn partner Mark A. Perry is counsel for the respondent.
American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20‑891) concerning patent eligibility under 35 U.S.C. § 101, in which the Court has invited the Solicitor General to file a brief expressing the views of the United States.
PersonalWeb Technologies, LLC v. Patreon, Inc. (U.S. No. 20-1394) concerning the Kessler

Other Federal Circuit News:

On July 19, 2021, the U.S. Senate voted to confirm Tiffany P. Cunningham as United States Circuit Judge for the Federal Circuit by a vote of 63-33. Judge Cunningham was a partner at Perkins Coie LLP and was previously a partner at Kirkland & Ellis LLP. Ms. Cunningham is a graduate of Harvard Law School and she earned a Bachelor of Science in chemical engineering from the Massachusetts Institute of Technology. Ms. Cunningham clerked for Judge Dyk of the Federal Circuit.

Federal Circuit Judge Kathleen O’Malley announced her plans to retire from the bench on March 11, 2022. Judge O’Malley was appointed to the Federal Circuit by President Obama in 2010. Prior to her elevation to the Federal Circuit, Judge O’Malley was appointed to the U.S. District Court for the Northern District of Ohio by President Clinton in 1994.

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit is available on the court’s website.

Live streaming audio is available on the Federal Circuit’s new YouTube channel. Connection information is posted on the court’s website.

The court will resume in-person arguments starting with the September 2021 court sitting.

Key Case Summaries (July 2021)

Bot M8 LLC v. Sony Corporation of America (Fed. Cir. No. 20-2218): Bot M8 LLC (“Bot M8”) sued Sony Corporation of America (“Sony”) for infringement of various patents. The district court sua sponte directed Bot M8 to file an amended complaint requiring Bot M8 to specify how every element of every claim is infringed and to reverse engineer the PS4 (the accused product) if it was able to. Bot M8 agreed to do so. After Bot M8 filed its First Amended Complaint (“FAC”), Sony filed a motion to dismiss, which the court granted. In a discovery hearing two days later, Bot M8 raised for the first time that in order to reverse engineer the PS4 and view the underlying code, it would have to “jailbreak” the system, which is a violation of the Digital Millennium Copyright Act (“DMCA”) and other anti-hacking statutes. In response, Sony gave Bot M8 permission to jailbreak the system. Bot M8 then sought leave of the court to file its Second Amended Complaint (“SAC”). The court denied Bot M8’s request citing lack of diligence. Bot M8 appealed the district court’s dismissal.

The panel (O’Malley, J., joined by Linn and Dyk, J.J.) affirmed-in-part, reversed-in-part, and remanded, holding that the district court was correct in dismissing two of the patents, but that it required “too much” with respect to the other two patents. The panel reaffirmed that “[a] plaintiff is not required to plead infringement on an element-by-element basis.”

For the first two patents, the panel affirmed the district court finding it did not err in dismissing the claims for insufficiently pleading a plausible claim because (1) the factual allegations were inconsistent and contradicted infringement, and (2) the allegations were conclusory. With respect to the second two patents, the panel reversed the district court determining that Bot M8 had supported its “assertions with specific factual allegations” and that the district court “demand[ed] too much” by dismissing these claims. The panel also affirmed the district court’s decision to deny Bot M8’s motion for leave to amend for lack of diligence. The panel noted that although it may have granted Bot M8’s motion if deciding it in the first instance, it found no abuse of discretion. While the district court should not have required reverse engineering of Sony’s products, Bot M8 waived its objections by telling the court it was happy to undertake the exercise. Moreover, Bot M8 failed to raise any concerns regarding its ability to reverse engineer the PS4 under the DMCA until after the court had issued its decision on Sony’s motion to dismiss.

Chemours Company v. Daikin Industries (Fed. Cir. No. 20-1289): The case involved two IPR final written decisions of the PTAB, which determined that claims directed to a polymer with a high melt flow rate are obvious. The Board relied on a prior art patent (“Kaulbach”) that disclosed a lower melt flow rate and a “very narrow molecular weight distribution.” The Board concluded that a POSA would be motivated to increase Kaulbach’s melt flow rate to the claimed range, even though doing so would broaden molecular weight distribution.

A majority of the panel (Reyna, J., joined by Newman, J.) reversed, holding that Kaulbach taught away from broadening molecular weight distribution and that, therefore, the Board’s proposed modification would necessarily alter Kaulbach’s inventive concept. Judge Dyk dissented in part on this issue, arguing that Kaulbach did not teach away from broadening molecular weight distribution, but only offered better alternatives. According to Judge Dyk, the Court’s precedent makes clear that an inferior combination may still be used for obviousness purposes. Judge Dyk also noted that increasing Kaulbach’s melt flow rate to the claimed range would not have necessarily broadened the molecular weight distribution beyond levels Kaulbach taught were acceptable.

In the unanimous part of the opinion, the panel also rejected the Board’s commercial success analysis, holding that the Board made three errors. First, the panel held that the Board erred by concluding that there could be no nexus between the claimed invention and the alleged commercial success because all elements of the challenged claims were present in Kaulbach or other prior art. The Court explained that where an invention is a unique combination of known elements, “separate disclosure of individual limitations . . . does not negate a nexus.” Next, the Court disagreed with the Board’s decision to require market share data, holding that sales data alone may be sufficient to show commercial success. Lastly, the Court rejected the Board’s finding that the proffered commercial success evidence was weak because the patents at issue were “blocking patents.” The Court held that “the challenged patent, which covers the claimed invention at issue, cannot act as a blocking patent.”

In re: Uber Technologies, Inc. (Fed Cir. No. 21-150) (nonprecedential): Uber sought a writ of mandamus ordering the United States District Court for the Western District of Texas to transfer the underlying actions to the United States District Court for the Northern District of California. The panel (Dyk, J., joined by Lourie and Reyna, J.J.) granted the petition. Gibson Dunn is counsel for Uber.

The panel explained that it had recently granted mandamus to direct the district court to transfer in two other actions filed by the plaintiffs asserting infringement of two of the same patents against different defendants, in In re Samsung Electronics Co., Nos. 2021-139, -140 (see our June 2021 update). In that case, the Federal Circuit rejected the district court’s determination that the plaintiffs’ actions could not have been brought in the transferee venue because the presence of the Texas plaintiff “is plainly recent, ephemeral, and artificial—just the sort of maneuver in anticipation of litigation that has been routinely rejected.” Noting that the district court itself recognized that the issues presented here are identical to those in plaintiffs’ other cases, the panel held that, as in Samsung, the district court erred in concluding that Uber had failed to satisfy the threshold question for venue.

With respect to the district court’s analysis of the traditional public and private factors, the court explained that this case involved very similar facts to those in Samsung, where the Court found that the district court erred by 1) “giving little weight to the presence of identified party witnesses in the Northern District of California despite no witness being identified in or near the Western District of Texas”; 2) “simply presuming that few, if any, party and non-party identified witnesses will likely testify at trial despite the defendants’ submitting evidence and argument to the contrary”; and 3) finding that “there was a strong public interest in retaining the case in the district based on Ikorongo’s other pending infringement action against Bumble Trading, LLC.” The court concluded that there was no basis for a disposition different from the one reached in Samsung. It noted that the reasons for not finding that judicial economy to override the clear convenience of the transferee venue apply with even more force here, given that the court had already directed the Samsung and LG actions to be transferred to Northern California in In re Samsung. The panel also found that the district court clearly erred in negating the transferee venue’s strong local interest by relying merely on the fact that the plaintiffs alleged infringement in the Western District of Texas.

In re: TCO AS (Fed. Cir. No. 21-158) (nonprecedential): NCS Multistage, Inc., a Canadian corporation, and NCS Multistage LLC, its Houston, Texas based subsidiary, sued TCO AS, a Norwegian company, for patent infringement in the Western District of Texas. TCO moved to transfer the case to the Southern District of Texas pursuant to 28 U.S.C. § 1404(a). The district court denied the motion, finding that TCO had failed to show the transferee venue was clearly more convenient.

TCO petitioned for a writ of mandamus, which the Federal Circuit (Taranto, Hughes, Stoll, JJ.) denied. Stressing the “highly deferential standard” for resolving a mandamus petition, the Federal Circuit could not “say that TCO has a clear and indisputable right to relief, particularly in light of the fact that several potential witnesses are located out-side of the proposed transferee venue, including some in the Western District of Texas, and the fact that the only party headquartered in the proposed transferee venue elected to litigate this case in the Western District of Texas.”

Gibson Dunn’s lawyers are available to assist in addressing any questions you may have regarding developments at the Federal Circuit. Please contact the Gibson Dunn lawyer with whom you usually work or the authors of this alert:

Blaine H. Evanson – Orange County (+1 949-451-3805, bevanson@gibsondunn.com)
Jessica A. Hudak – Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group:
Allyson N. Ho – Dallas (+1 214-698-3233, aho@gibsondunn.com)
Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Intellectual Property Group:
Kate Dominguez – New York (+1 212-351-2338, kdominguez@gibsondunn.com)
Y. Ernest Hsin – San Francisco (+1 415-393-8224, ehsin@gibsondunn.com)
Josh Krevitt – New York (+1 212-351-4000, jkrevitt@gibsondunn.com)
Jane M. Love, Ph.D. – New York (+1 212-351-3922, jlove@gibsondunn.com)

Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

This edition of Gibson Dunn’s Federal Circuit Update summarizes the Supreme Court’s decisions in Arthrex and Minerva Surgical. It also discusses recent Federal Circuit decisions concerning patent eligibility, subject matter jurisdiction, prosecution laches, and more Western District of Texas venue issues. The Federal Circuit announced that it will resume in-person arguments in September.

Federal Circuit News

Supreme Court:

United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458): As we summarized in our June 21, 2021 client alert, the Supreme Court held 5-4 that the Appointments Clause does not permit administrative patent judges (APJs) to exercise executive power unreviewed by any Executive Branch official. The Director therefore has the authority to unilaterally review any Patent Trial and Appeal Board (PTAB) decision. The Court held 7-2 that 35 U.S.C. § 6(c) is unenforceable as applied to the Director and that the appropriate remedy is a limited remand to the Acting Director to decide whether to rehear the inter partes review petition, rather than a hearing before a new panel of APJs. Gibson Dunn partner Mark A. Perry is co-counsel for Smith & Nephew, and argued the case before the Supreme Court.

In response to the Court’s decision, the Federal Circuit issued an order requiring supplemental briefing in Arthrex-related cases. In addition, the PTAB implemented an interim Director review process. Review may now be initiated sua sponte by the Director or may be requested by a party to a PTAB proceeding. The PTAB published “Arthrex Q&As,” which provides more details on the interim Director review process.

Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440): As we summarized in our June 30, 2021 client alert, the Supreme Court upheld the doctrine of assignor estoppel in patent infringement actions, concluding in a 5-4 decision that a patent assignor cannot, with certain exceptions, subsequently challenge the patent’s validity. The Court indicated that the doctrine may have been applied too broadly in the past and provided three examples of when an assignor has an invalidity defense: (1) when an employee assigns to her employer patent rights to future inventions before she can possibly make a warranty of validity as to specific patent claims, (2) when a later legal development renders irrelevant the assignor’s warranty of validity at the time of assignment, and (3) when the patent claims change after assignment and render irrelevant the assignor’s validity warranty.

The Court did not add any new cases originating at the Federal Circuit.

The Court denied the petition in Warsaw Orthopedic v. Sasso (U.S. No. 20-1284) concerning state versus federal court jurisdiction.

The following petitions are still pending:

Biogen MA Inc. v. EMD Serono, Inc. (U.S. No. 20-1604) concerning anticipation of method-of-treatment patent claims. Gibson Dunn partner Mark A. Perry is counsel for the respondent.
American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20‑891) concerning patent eligibility under 35 U.S.C. § 101, in which the Court has invited the Solicitor General to file a brief expressing the views of the United States.
PersonalWeb Technologies, LLC v. Patreon, Inc. (U.S. No. 20-1394) concerning the Kessler

Other Federal Circuit News:

The Federal Circuit announced that, starting with the September 2021 court sitting, the court will resume in-person arguments. The court has issued Protocols for In-Person Argument, as well as a new administrative order implementing these changes, which are available on the court’s website.

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit is available on the court’s website.

Live streaming audio is available on the Federal Circuit’s new YouTube channel. Connection information is posted on the court’s website.

Key Case Summaries (June 2021)

Yu v. Samsung Electronics Co. (Fed. Cir. No. 20-1760): Yu appealed a district court’s order finding that the asserted claims of Yu’s patent (titled “Digital Cameras Using Multiple Sensors with Multiple Lenses”) were ineligible under 35 U.S.C. § 101.

The district court granted the defendants’ motion to dismiss under § 101 on the basis that the asserted claims were directed to “the abstract idea of taking two pictures and using those pictures to enhance each other in some way.”

The Federal Circuit (Prost, J., joined by Taranto, J.) affirmed. At Step 1 of the Alice analysis, the majority “agree[d] with the district court that claim 1 is directed to the abstract idea of taking two pictures (which may be at different exposures) and using one picture to enhance the other in some way,” noting that “the idea and practice of using multiple pictures to enhance each other has been known by photographers for over a century.” At Step 2, the majority “conclude[d] that claim 1 does not include an inventive concept sufficient to transform the claimed abstract idea into a patent-eligible invention” because “claim 1 is recited at a high level of generality and merely invokes well-understood, routine, conventional components to apply the abstract idea.” In so concluding, the majority stated that the recitation of “novel subject matter . . . is insufficient by itself to confer eligibility.”

Judge Newman dissented, writing that the camera at issue “is a mechanical and electronic device of defined structure and mechanism; it is not an ‘abstract idea.’”

Chandler v. Phoenix Services (Fed. Cir. No. 20-1848): The panel (Hughes, J., joined by Chen and Wallach, J.J.) held that because Chandler’s cause of action arises under the Sherman Act, rather than patent law, and because the claims do not depend on a resolution of a substantial question of patent law, the Court lacked subject matter jurisdiction. The Court discussed a recent decision, Xitronix I, in which the Court found it lacked jurisdiction. There, the Court held that a Walker Process claim does not inherently present a substantial issue of patent law. Further, in this case, there was a prior decision that found the ’993 patent unenforceable. Thus, the transferee appellate court would have little need to discuss patent law issues. This case would not alter the validity of the ’993 patent and any discussion of the patent would be “merely hypothetical.” Thus, the Court stated this was an antitrust case and there was not proper jurisdiction simply because a now unenforceable patent was once involved in the dispute.

Hyatt v. Hirshfeld (Fed. Cir. No. 18-2390): Hyatt, the patent applicant, filed a 35 U.S.C. § 145 action against the Patent Office with respect to four patent applications. The Patent Office appealed the District Court of the District of Columbia’s judgment that the Patent Office failed to carry its burden of proving prosecution laches.

The panel (Reyna, J., joined by Wallach and Hughes, J.J.) held that the Patent Office can assert a prosecution laches defense in an action brought by the patentee under 35 U.S.C. § 145, reasoning that the language of § 282 demonstrates Congress’s desire to make affirmative defenses, including prosecution laches, broadly available. Further, the Court stated the Patent Office can assert the prosecution laches defense in a § 145 action even if it did not previously issue rejections based on, or warnings regarding, prosecution laches during the prosecution of the application. Still, the PTO’s failure to previously warn an applicant or reject claims based on prosecution laches may be part of the totality of the circumstances analysis in determining prosecution laches.

The Court found that the Patent Office’s prosecution laches evidence and arguments presented at trial shifted the burden to Hyatt to show by a preponderance of evidence he had a legitimate, affirmative reason for his delay, and the Court remanded the case to afford Hyatt an opportunity to present such evidence.

Amgen Inc. v. Sanofi (Fed. Cir. No. 20-1074): On June 21, 2021, the court denied Amgen’s petition for panel rehearing and rehearing en banc. The panel wrote separately to explain that it had not created a new test for enablement.

As we summarized in our February alert, the panel had held that the claims at issue were not enabled because undue experimentation would be required to practice the full scope of the claims. The panel had explained that there are “high hurdles in fulfilling the enablement requirement for claims with broad functional language.”

In re: Samsung Electronics Co., Ltd. (Fed Cir. No. 21-139): Samsung and LG sought writs of mandamus ordering the United States District Court for the Western District of Texas to transfer the underlying actions to the United States District Court for the Northern District of California. The panel (Dyk, J., joined by Lourie and Reyna, J.J.) granted the petition.

The panel first held that plaintiffs’ venue manipulation tactics must be disregarded and so venue in the Northern District of California would have been proper under § 1400(b). The panel explained that the presence of the Texas plaintiff “is plainly recent, ephemeral, and artificial—just the sort of maneuver in anticipation of litigation that has been routinely rejected.”

With respect to the merits of the transfer motion, the panel explained that the district court (1) “clearly assigned too little weight to the relative convenience of the Northern District of California,” (2) “provided no sound basis to diminish the[] conveniences” of willing witnesses in the Northern District of California, and (3) “overstated the concern about waste of judicial resources and risk of inconsistent results in light of plaintiffs’ separate infringement suit … in the Western District of Texas.” With respect to local interest, the panel rejected the district court’s position that “‘it is generally a fiction that patent cases give rise to local controversy or interest.’” It also explained that “[t]he fact that infringement is alleged in the Western District of Texas gives that venue no more of a local interest than the Northern District of California or any other venue.” Finally, with respect to court congestion, the panel stated that “even if the court’s speculation is accurate that it could more quickly resolve these cases based on the transferee venue’s more congested docket, … rapid disposition of the case [was not] important enough to be assigned significant weight in the transfer analysis here.”

In re: Freelancer Ltd. (Fed. Cir. No. 21-151) (nonprecedential): Freelancer Limited petitioned for a writ of mandamus instructing Judge Albright in the Western District of Texas to stay proceedings until Freelancer’s motion to dismiss is resolved. Freelancer’s motion was fully briefed as of March 4, 2021. Freelancer subsequently filed a motion to stay proceedings pending resolution of the motion to dismiss, and the stay motion was fully briefed as of April 21, 2021. A scheduling order has been entered in the case, and the plaintiff’s opening claim construction brief was filed on May 27, 2021. Freelancer then filed its mandamus petition. Neither of Freelancer’s motions has been resolved.

The Federal Circuit (Taranto, J., Hughes, J., and Stoll, J.) denied the petition. The court stated that “Freelancer has identified no authority establishing a clear legal right to a stay of all proceedings premised solely on the filing of a motion to dismiss the complaint.” The court further stated that “any delay in failing to resolve either of Freelancer’s pending motions to dismiss and stay proceedings is [not] so unreasonable or egregious as to warrant mandamus relief.” The court noted, however, that any “significant additional delay may alter [its] assessment of the mandamus factors in the future,” made clear that it “expect[ed] . . . that the district court w[ould] soon address the pending motion to dismiss or alternatively grant a stay.”

In re: Volkswagen Group of America, Inc. (Fed. Cir. No. 21-149) (nonprecedential): Volkswagen petitioned for a writ of mandamus directing the United States District Court for the Western District of Texas to dismiss or to transfer to the United States District Court for the Eastern District of Michigan. Alternatively, Volkswagen sought to stay all deadlines unrelated to venue until the district court rules on the pending motion to dismiss or transfer.

The Federal Circuit (Taranto, J., Hughes, J., and Stoll, J.) denied the petition. Because the district court had indicated that it will resolve that motion before it conducts a Markman hearing in this case, Volkswagen was unable to show that it is unable to obtain a ruling on its venue motion in a timely fashion without mandamus. The Court noted, however, that the district court’s failure to issue a ruling on Volkswagen’s venue motion before a Markman hearing may alter our assessment of the mandamus factors.

Blaine H. Evanson – Orange County (+1 949-451-3805, bevanson@gibsondunn.com)
Jessica A. Hudak – Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group:
Allyson N. Ho – Dallas (+1 214-698-3233, aho@gibsondunn.com)
Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

This edition of Gibson Dunn’s Federal Circuit Update summarizes a new petition for certiorari in a case originating in the Federal Circuit concerning anticipation of method-of-treatment claims. It also discusses recent Federal Circuit decisions concerning assignment agreements, personal jurisdiction, and more Western District of Texas venue issues.

Federal Circuit News

Supreme Court:

This month, the Supreme Court did not add any new cases originating at the Federal Circuit. United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458) and Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440) are still pending. Decisions in both cases are expected this month.

Noteworthy Petitions for a Writ of Certiorari:

A newly filed certiorari petition challenges the Federal Circuit’s longstanding approach to anticipation in the context of recombinant biological products (see Amgen Inc. v. Hoffman-La Roche Ltd., 580 F.3d 1340 (Fed. Cir. 2009)):

Biogen MA Inc. v. EMD Serono, Inc. (U.S. No. 20-1604): “Whether courts may disregard the express claim term ‘recombinant’ so as to render a method-of-treatment patent anticipated—and thus invalid—in light of prior-art treatments that used the naturally occurring human protein, where it is undisputed that the recombinant protein was not used in the prior art?” Gibson Dunn partners Mark A. Perry, Wayne M. Barsky, and Timothy P. Best represented Serono in the Federal Circuit.

Other updates include:

On May 3, in American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20‑891), concerning patent eligibility under 35 U.S.C. § 101, the Court invited the Acting Solicitor General to file a brief expressing the views of the United States.

On May 25, the Court requested a response in PersonalWeb Technologies, LLC v. Patreon, Inc. (U.S. No. 20-1394), which concerns the Kessler doctrine.

The petition in Warsaw Orthopedic v. Sasso (U.S. No. 20-1284) concerning state versus federal court jurisdiction is still pending. The petition in Sandoz v. Immunex (U.S. No. 20-1110), which concerns obviousness-type double patenting, was denied. The petition in Ariosa Diagnostics, Inc. v. Illumina, Inc. (U.S. No. 20-892), concerning patent eligibility under 35 U.S.C. § 101, was dismissed by the parties.

Other Federal Circuit News:

On May 22, 2021, the Honorable Kimberly A. Moore assumed the duties of Chief Circuit Judge of the Federal Circuit.

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit is available on the court’s website.

Live streaming audio is available on the Federal Circuit’s new YouTube channel. Connection information is posted on the court’s website.

Key Case Summaries (May 2021)

Trimble Inc. v. PerDiemCo LLC (Fed. Cir. No. 19-2164): Trimble appealed a district court’s order finding that it lacked personal jurisdiction over PerDiemCo in Trimble’s declaratory judgment noninfringement action. Over the course of several months, PerDiemCo (a Texas company whose only employee worked in Washington, D.C.) communicated with Trimble (a Delaware company headquartered in California) twenty-two times about Trimble’s alleged infringement of PerDiemCo’s assigned patents. Trimble then filed a declaratory judgment action in the Northern District of California seeking a declaration of noninfringement. The district court dismissed the case for lack of jurisdiction under Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355, 1361 (Fed. Cir. 1998), which stated that “[a] patentee should not subject itself to personal jurisdiction in a forum solely by informing a party who happens to be located there of suspected infringement” because “[g]rounding personal jurisdiction on such contacts alone would not comport with principles of fairness.”

The Federal Circuit (Dyk, J., joined by Newman, J. and Hughes, J.) reversed and remanded. The court found that “[t]hree subsequent developments have clarified the scope of Red Wing”: (1) “the Supreme Court cases following Red Wing have made clear that the analysis of personal jurisdiction cannot rest on special patent policies”; (2) “the Supreme Court has held that communications sent into a state may create specific personal jurisdiction, depending on the nature and scope of such communications”; and (3) “the Supreme Court’s recent decision in [Ford Mo-tor Co. v. Mont. Eighth Jud. Dist. Ct., 141 S. Ct. 1017, 1024 (2021)] has established that a broad set of a defendant’s contacts with a forum [is] relevant to the minimum contacts analysis.” The court concluded that, under these three principles, Red Wing remains correctly decided on its facts due to the limited number of communications in that case. But the court held that exercising personal jurisdiction over PerDiemCo here would comport with due process because PerDiemCo’s communications with Trimble were “far more extensive than those in Red Wing” and went beyond solely informing Trimble of suspected infringement. As such, the five-factor balancing test from Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985), and World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980), was satisfied.

Bio-Rad Laboratories, Inc. v. ITC (Fed. Cir. No. 20-1785): Bio-Rad appealed a final determination of the International Trade Commissions finding that Bio-Rad was not a co-owner of three patents directed to methods for tagging small DNA segments in microfluidics using droplets asserted against it in a complaint by 10X Genomics Inc. Two of the inventors of the asserted patents previously worked for Bio-Rad before leaving and starting 10X. Although the applications that led to the asserted patents were filed after those inventors departed Bio-Rad, Bio-Rad asserted that those inventors developed “ideas” that contributed to the inventions described in the asserted patents while still employed by Bio-Rad. Because the inventors were contractually obligated to assign their ideas to it, Bio-Rad argued that it could not be liable for infringement because it co-owned the asserted patents. The ALJ rejected that argument, and found that Bio-Rad infringed all three of the asserted patents. The Commission agreed and Bio-Rad appealed.

The Federal Circuit (Taranto, J., joined by Chen, J. and Stoll, J.) affirmed. The court held that substantial evidence supported the Commission’s finding that Bio-Rad infringed all three of the asserted patents, rejecting each of Bio-Rad’s arguments challenging that finding. The court also rejected Bio-Rad’s indefiniteness and lack of domestic industry arguments. Lastly, the court held that the Commission correctly determined that Bio-Rad did not have any ownership interest in the asserted patents. The court held that substantial evidence supported the Commission’s finding that the co-inventors’ work while employed at Bio-Rad amounted to no more than general ideas and concepts known in the art. The court explained that work that “might one day turn out to contribute significantly to a later patentable invention” is not itself intellectual property, which “does not exist until at least conception of” a patentable invention. Accordingly, the court rejected Bio-Rad’s co-ownership argument, explaining that Bio-Rad’s assignment agreement was limited to “intellectual property” that was invented during an employee’s employment period with Bio-Rad, and no such invention occurred with respect to the asserted patents until after the co-inventors left Bio-Rad’s employ.

In Re Bose Corp. (Fed. Cir. No. 21-145) (nonprecedential): Bose Corporation petitioned for a writ of mandamus directing the United States District Court for the Western District of Texas to stay all non-venue-related proceedings until the district court resolves Bose’s pending motion to dismiss or transfer.

The panel (Dyk, J., joined by Lourie, J. and Reyna, J.) denied the petition, explaining that, under the district court’s March 23, 2021 standing order, the district court would not conduct a Markman hearing until after resolution of Bose’s pending motion to dismiss or transfer the case. The Court expected the district court to “promptly” decide Bose’s motion.

In Re Western Digital Technologies, Inc. (Fed. Cir. No. 21-137) (nonprecedential): Western Digital (“WDT”) petitioned for a writ of mandamus instructing Judge Albright in the Western District of Texas to transfer the patent infringement case to the Northern District of California. The district court had found the Western District of Texas more convenient because it could compel the testimony of non-party witnesses, the Western District had a local interest, and that the Northern District had a more congested docket.

The panel (Prost, C.J., joined by O’Malley, J. and Wallach, J.) denied the petition and determined that WDT had not met the demanding standard for mandamus relief. The panel noted that the district court incorrectly overstated the burden on WDT to show transfer is more convenient as “heavy” and “significant,” and that they “may have evaluated some of the factors differently.” The panel did not find that the district court’s ultimate conclusion amounted to a clear abuse of discretion.

Blaine H. Evanson – Orange County (+1 949-451-3805, bevanson@gibsondunn.com)
Jessica A. Hudak – Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group:
Allyson N. Ho – Dallas (+1 214-698-3233, aho@gibsondunn.com)
Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

This edition of Gibson Dunn’s Federal Circuit Update summarizes a new petition for certiorari in a case originating in the Federal Circuit concerning the Kessler preclusion doctrine, it addresses the Federal Circuit’s announcement that Judge Moore will become Chief Judge on May 22, 2021, and it discusses recent Federal Circuit decisions concerning self-enabling references, Article III standing, patent eligibility, and more Western District of Texas venue issues.

Federal Circuit News

Supreme Court:

This month, the Supreme Court did not add any new cases originating at the Federal Circuit. As we summarized in our January and February updates, the Court has two such cases pending: United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458) and Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440).

The Court heard argument on the doctrine of assignor estoppel on Wednesday, April 21, 2021, in Minerva v. Hologic.

Noteworthy Petitions for a Writ of Certiorari:

There is one new potentially impactful certiorari petition that is currently before the Supreme Court:

PersonalWeb Technologies, LLC v. Patreon, Inc. (U.S. No. 20-1394): 1. Whether the Federal Circuit correctly interpreted Kessler v. Eldred, 206 U.S. 285 (1907), to create a freestanding preclusion doctrine that may apply even when claim and issue preclusion do not. 2. Whether the Federal Circuit properly extended its Kessler doctrine to cases where the prior judgment was a voluntary dismissal.

Other updates include:

On April 1, the Court requested a response in Warsaw Orthopedic v. Sasso (U.S. No. 20-1284) concerning state versus federal court jurisdiction.

As of April 26, the cert-stage briefing is complete in Sandoz v. Immunex (U.S. No. 20-1110), which concerns obviousness-type double patenting. Association for Accessible Medicines has filed an amicus brief in support of Sandoz and the Court has distributed this case for its May 13 conference.

On April 19, Illumina filed its brief in opposition in Ariosa Diagnostics, Inc. v. Illumina, Inc. (U.S. No. 20-892) concerning patent eligibility under 35 U.S.C. § 101.

American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20-891), also concerning patent eligibility under 35 U.S.C. § 101, is scheduled for the Court’s April 30 conference.

Other Federal Circuit News:

The Federal Circuit announced that, on May 22, 2021, the Honorable Kimberly A. Moore will become Chief Judge. She will succeed the Honorable Sharon Prost who has served as Chief Judge since May 31, 2014, and has served as Circuit Judge since September 24, 2001. Judge Moore has served as Circuit Judge on the Federal Circuit since September 8, 2006.

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit are available on the court’s website.

Live streaming audio is available on the Federal Circuit’s new YouTube channel. Connection information is posted on the court’s website.

Key Case Summaries (April 2021)

Raytheon Technologies Corp. v. General Electric Co. (Fed. Cir. No. 20-1755): Raytheon appealed a final inter partes review decision from the PTAB determining that certain claims of the asserted patent unpatentable as obvious. Raytheon argued before the Board that the prior art reference, Knip, failed to enable a skilled artisan to make the claimed invention because Knip relied on “revolutionary” materials unavailable as of the priority date of the asserted patent. The Board found that Knip was “enabling,” because it provided enough information to allow a skilled artisan to calculate the power density of Knip’s advanced engine, which fell within the claimed density range. The Board thus concluded that Knip rendered the challenged claims obvious.

The Federal Circuit (Chen, J., joined by Lourie, J. and Hughes, J.) reversed. The court agreed with Raytheon that the Board legally erred it in its prior art enablement analysis. To render a claim obvious, the prior art must enable a skilled artisan to make and use the claimed invention. The Board, rather than determining whether Knip enabled a skilled artisan to make and use the claimed invention, focused only on whether a skilled artisan was provided with sufficient parameters in Knip to determine the claimed power density without undue experimentation. The Board defended its position by noting that the claims did not require the advanced materials disclosed in Knip. However, Raytheon had presented unrebutted testimony that Knip fails to enable a skilled artisan to physically make Knip’s engine given the unavailability of the revolutionary composite material contemplated by Knip. The court thus concluded that the Board’s finding that Knip is “enabling” was legal error, because without a physical working engine, a skilled artisan could not achieve the claimed power density.

Apple Inc. v. Qualcomm Inc. (Fed. Cir. No. 20-1561): Apple appealed two PTAB inter partes review final written decisions holding that Apple did not prove several claims of two patents were obvious. These two patents were also asserted against Apple in district court. However, before Apple filed its appeal to the Federal Circuit, Apple and Qualcomm settled all litigation between the companies. Based on that settlement, the district court action was dismissed with prejudiced at the parties’ request.

The Federal Circuit (Moore, J., joined by Reyna, J. and Hughes, J.) dismissed Apple’s appeal for lack of standing. As a preliminary matter, the court stated that Apple should have addressed arguments and evidence establishing its standing in its opening brief. The court declined to apply waiver, however, and addressed the merits of the standing issue. The court rejected Apple’s argument that its ongoing payment obligations provides standing because Apple did not provide evidence that the validity of any single patent, including the two patents at issue, would impact its ongoing payment obligations. The court also found Apple’s argument that Qualcomm could later sue for infringement after the settlement agreement expires was too speculative to confer standing. Finally, the court explained that any injury based on the inter partes review estoppel’s provision was also too speculative to provide standing, especially where Apple did not show that it will likely be practicing the patent claims.

In Re: Board of Trustees of the Leland Stanford Junior University (Fed. Cir. No. 20-1288): The PTAB affirmed an examiner’s final rejection of claims directed to “computerized statistical methods for determining haplotype phase,” on the basis that the claims were not patent-eligible under 35 U.S.C. § 101. Haplotype phasing “is a process for determining the parent from whom alleles—i.e., versions of a gene—are inherited.” The PTAB held that the claims were directed to two abstract mental processes: (1) “the step of ‘imputing an initial haplotype phase for each individual in the plurality of individuals based on a statistical model’”; and (2) “the step of automatically replacing an imputed haplotype phase with a randomly modified haplotype phase when the latter is more likely correct than the former.” The PTAB also held that the claims lacked an inventive concept, as they “recited generic steps of receiving and storing genotype data in a computer memory, extracting the predicted haplotype phase from the data structure, and storing it in a computer memory.”

The Federal Circuit (Reyna, J., joined by Prost, C.J. and Lourie, J.) affirmed. At step one, the court held that the claims were directed to the abstract idea of “the use of mathematical calculations and statistical modeling.” The court rejected the applicant’s argument that the claims provided a technological improvement by allowing for “more accurate haplotype predictions.” The court explained that “[t]he different use of a mathematical calculation, even one that yields different or better results, does not render patent eligible subject matter.” At step two, the court held that the claims lacked an inventive concept because the “the recited steps of receiving, extracting, and storing data amount to well-known, routine, and conventional steps taken when executing a mathematical algorithm on a regular computer.”

In Re TracFone Wireless (Fed. Cir. No. 21-136) (nonprecedential): As discussed in our March update, the Federal Circuit granted TracFone’s first mandamus petition, ordering Judge Albright to “issue [his] ruling on the motion to transfer within 30 days from the issuance of this order, and to provide a reasoned basis for its ruling that is capable of meaningful appellate review.” On April 20, the court granted mandamus for a second time, holding that Judge Albright “clearly abused” his discretion in denying transfer under § 1404(a) by relying on a “rigid and formulaic” application of the Fifth Circuit’s 100-mile rule.

Blaine H. Evanson – Orange County (+1 949-451-3805, bevanson@gibsondunn.com)
Jessica A. Hudak – Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group:
Allyson N. Ho – Dallas (+1 214-698-3233, aho@gibsondunn.com)
Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Intellectual Property Group:
Wayne Barsky – Los Angeles (+1 310-552-8500, wbarsky@gibsondunn.com)
Josh Krevitt – New York (+1 212-351-4000, jkrevitt@gibsondunn.com)
Mark Reiter – Dallas (+1 214-698-3100, mreiter@gibsondunn.com)

Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

This edition of Gibson Dunn’s Federal Circuit Update summarizes key petitions for certiorari in cases originating in the Federal Circuit, addresses the Federal Circuit’s announcement that Judge Wallach will be taking senior status and the court’s updated Rules of Practice, and discusses recent Federal Circuit decisions concerning issue preclusion, Section 101, appellate procedure for PTAB appeals, and the latest mandamus petitions on motions to transfer from the Western District of Texas.

Federal Circuit News

Supreme Court:

Today, the Court decided Google LLC v. Oracle America, Inc. (U.S. No. 18-956). In a 6-2 decision, the Court held that because Google “reimplemented” a user interface, “taking only what was needed to allow users to put their accrued talents to work in a new and transformative program,” Google’s copying of the Java API was a fair use of that material as a matter of law. The Court did not decide the question whether the Copyright Act protects software interfaces. “Given the rapidly changing technological, economic, and business-related circumstances,” the Court explained, “[the Court] should not answer more than is necessary to resolve the parties’ dispute.” The Court therefore assumed, “purely for argument’s sake,” that the Java interface is protected by copyright.

This month, the Supreme Court did not add any new cases originating at the Federal Circuit. As we summarized in our January and February updates, the Court has two such cases pending: United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458); and Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440).

The Court will hear argument on the doctrine of assignor estoppel on Wednesday, April 21, 2021, in Minerva v. Hologic.

Noteworthy Petitions for a Writ of Certiorari:

There are three new potentially impactful certiorari petitions that are currently before the Supreme Court:

Ono Pharmaceutical v. Dana-Farber Cancer Institute (U.S. No. 20-1258): “Whether the Federal Circuit erred in adopting a bright-line rule that the novelty and non-obviousness of an invention over alleged contributions that were already in the prior art are ‘not probative’ of whether those alleged contributions were significant to conception.”

Warsaw Orthopedic v. Sasso (U.S. No. 20-1284): “Whether a federal court with exclusive jurisdiction over a claim may abstain in favor of a state court with no jurisdiction over that claim.”

Sandoz v. Immunex (U.S. No. 20-1110): “May the patent owner avoid the rule against double patenting by buying all of the substantial rights to a second, later-expiring patent for essentially the same invention, so long as the seller retains nominal ownership and a theoretical secondary right to sue for infringement?”

The petitions in American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20-891) and Ariosa Diagnostics, Inc. v. Illumina, Inc. (U.S. No. 20-892) are still pending.

After requesting a response, the Court denied Argentum’s petition in Argentum Pharmaceuticals LLC v. Novartis Pharmaceuticals Corporation (U.S. No. 20-779). Gibson Dunn partners Mark Perry and Jane Love were counsel for Novartis.

Other Federal Circuit News:

Judge Wallach to Retire. On March 16, 2021, the Federal Circuit announced that Judge Evan J. Wallach will retire from active service and assume senior status, effective May 31, 2021. Judge Wallach served on the Federal Circuit for nearly 10 years and, prior to that, served on the U.S. Court of International Trade for 16 years. Judge Wallach’s full biography is available on the court’s website. On March 30, President Biden announced his intent to nominate Tiffany Cunningham for the empty seat. Ms. Cunningham has been a partner in the Patent Litigation practice of Perkins Coie LLP since 2014, and serves on the 17-member Executive Committee of the firm. She began her legal career as a law clerk to Judge Dyk.

Federal Circuit Practice Update

Updated Federal Circuit Rules. Pursuant to the court’s December 9, 2020 public notice, the court has published an updated edition of the Federal Circuit Rules. This edition incorporates the emergency amendment to Federal Circuit Rule 15(f) brought about by the court’s en banc decision in NOVA v. Secretary of Veterans Affairs (Fed. Cir. No. 20‑1321).

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit are available on the court’s website.

Live streaming audio is available on the Federal Circuit’s new YouTube channel. Connection information is posted on the court’s website.

Case of Interest:

New Vision Gaming & Development, Inc. v. SG Gaming, Inc. (Fed. Cir. No. 20‑1399): This case concerns “[w]hether the unusual structure for instituting and funding AIA post-grant reviews violates the Due Process Clause in view of Tumey v. Ohio, 273 U.S. 510 (1927), and its progeny, which establish ‘structural bias’ as a violation of due process.” It attracted an amicus brief from US Inventor in support of appellant, which argues that the administrative patent judges’ compensation and performance rating system affects their decision making. Panel M will hear argument in New Vision Gaming on April 9, 2021, at 10:00 AM Eastern.

Key Case Summaries (March 2021)

SynQor, Inc. v. Vicor Corp. (Fed. Cir. No. 19-1704): In an inter partes reexamination (“IPR”), the Patent Trial and Appeal Board (“PTAB”) found several claims of SynQor’s patent unpatentable over the prior art. SynQor appealed, arguing that common law preclusion arising from a prior reexamination involving two related patents collaterally estopped the Board from finding a motivation to combine.

The Federal Circuit panel majority (Hughes, J., joined by Clevenger, J.) vacated and remanded, holding that common law issue preclusion can apply to IPRs. Analyzing the statutory scheme, the majority determined that Congress did not intend to prevent application of common law estoppel. Instead, the estoppel provisions of 35 U.S.C. §§ 315(c), 317(b) were more robust than common law collateral estoppel and fully consistent with allowing common law estoppel. The majority also determined that IPRs satisfied the traditional elements of issue preclusion. The majority explained that unlike an ex parte reexamination, Congress provided the third-party reexamination requestor the opportunity to fully participate in inter partes proceedings. The majority also determined that inter partes reexaminations contained sufficient procedural elements necessary to invoke issue preclusion. In an IPR, a party has the opportunity to respond to the other party’s evidence, challenge an expert’s credibility and submit its own expert opinions. Thus, the majority found that the lack of cross-examination did not prevent common law issue preclusion from applying to IPRs.

Judge Dyk dissented, arguing that common law issue preclusion should not apply to inter partes reexaminations because of the lack of compulsory process and cross-examination.

In Re: Board of Trustees of the Leland Stanford Junior University (Fed. Cir. No. 20-1012): The PTAB affirmed the examiner’s final rejection of Stanford’s claims directed to determining haplotype phase, on the basis that the claims were ineligible. The process of haplotype phasing involves determining from which parent an allele was inherited. The PTAB held that the claims were directed to “receiving and analyzing information,” which are “mental processes within the abstract idea category,” and that the claims lacked an inventive concept.

The Federal Circuit (Reyna, J., joined by Prost, C.J. and Lourie, J.) affirmed. At step one, the court held that the claims were directed to the abstract idea of “mathematically calculating alleles’ haplotype phase.” At step two, it held that the claims lacked an inventive concept, noting that the claims recited no steps that “practically apply the claimed mathematical algorithm.” The court held that, instead, the claims merely stored the haplotype phase information, which could not transform the abstract idea into patent-eligible subject matter. It further held that the dependent claims recited limitations amounting to no more than an instruction to apply that abstract idea.

Mylan Laboratories v. Janssen Pharmaceutica (Fed. Cir. No. 20-1071): Mylan petitioned for IPR of Janssen’s patent. Janssen opposed institution on the grounds that instituting the IPR would be an inefficient use of the PTAB’s resources because of two co-pending district court actions: one against Mylan and a second against Teva Pharmaceuticals that was set to go to trial soon after the institution decision. The Board applied its six-factor standard articulated in Fintiv and denied institution. Mylan appealed and requested mandamus relief; arguing that denying IPR based on litigation with a third party undermined Mylan’s constitutional and other due process rights, and that application of the six-factor standard violated congressional intent.

The Federal Circuit (Moore, J., joined by Newman, J. and Stoll, J.) granted Janssen’s motion to dismiss the appeal and denied Mylan’s petition for a writ of mandamus. The court dismissed Mylan’s direct appeal and reiterated that the court lacks jurisdiction over appeals from decisions denying institution because Section 314(d) specifically makes institution decisions “nonappealable.” The court noted that “judicial review [of institution decisions] is available in extraordinary circumstances by petition for mandamus,” even though “the mandamus standard will be especially difficult to satisfy” when challenging a decision denying institution of an IPR. Indeed, the court noted that “it is difficult to imagine a mandamus petition that challenges a denial of institution and identifies a clear and indisputable right to relief.” Considering the merits of Mylan’s petition, the court explained that “there is no reviewability of the Director’s exercise of his discretion to deny institution except for colorable constitutional claims,” which Mylan had failed to present.

Uniloc 2017 v. Facebook (Fed. Cir. No. 19-1688): Uniloc appealed from a PTAB ruling that the petitioners were not estopped from challenging the claims and that the patents at issue were invalid as obvious. Facebook filed two IPR petitions and then joined an IPR petition that had been previously filed by Apple, which challenged only a subset of the claims in the Facebook petitions. LG then joined Facebook’s two petitions, but not Apple’s. After instituting trial on Facebook’s two IPR petitions, the PTAB issued it final written decision in the Apple IPR, upholding the validity of Apple’s claims. The PTAB determined that, as of the final written decision on the Apple IPR, Facebook was estopped from challenging the overlapping claims in its own IPR petitions under § 315 (e)(1). LG, however, was not estopped from challenging the overlapping claims.

The Federal Circuit (Chen, J., joined by Lourie, J. and Wallach, J.) affirmed. The panel first determined that it had jurisdiction to review the challenge because the final written decision in the Apple IPR did not issue until after the institution of trial on the Facebook petitions. Next, the panel held that LG was not a real-party-at-interest or privy of Facebook because there was no evidence of any sort of preexisting, established relationship that indicates coordination related to the Apple IPR. According to the panel, moreover, Facebook was not estopped from addressing the non-overlapping claims (even the claim that depended from an overlapping claim) because § 315 (e)(1) specifically applies to claims in a patent. The panel then addressed the PTAB’s obviousness determination regarding the challenged claims and affirmed the Board’s obviousness findings as supported by substantial evidence.

In Re TracFone Wireless (Fed. Cir. No. 21-118): Precis Group sued TracFone in the Western District of Texas, alleging that venue was proper because TracFone has a store in San Antonio. TracFone moved to transfer on the grounds that venue was inconvenient, as well as improper because it no longer has a branded store in the district. For several months, the district court (Judge Albright) did not decide the motion, and instead kept the case moving towards trial. After eight months, TracFone petitioned the Federal Circuit for a writ of mandamus.

In its decision granting mandamus, the Federal Circuit (Reyna, J., joined by Chen, J. and Hughes, J.) ordered Judge Albright to “issue its ruling on the motion to transfer within 30 days from the issuance of this order, and to provide a reasoned basis for its ruling that is capable of meaningful appellate review.” It also ordered that all proceedings in the case be stayed until further notice. Notably, the court explained “that any familiarity that [the district court] has gained with the underlying litigation due to the progress of the case since the filing of the complaint is irrelevant when considering the transfer motion and should not color its decision.” Judge Albright denied the motion to transfer the day after the mandamus decision issued.

The Federal Circuit has recently denied two other petitions for mandamus involving cases before Judge Albright. In In re Adtran, Inc. (Fed. Cir. No. 21-115), the court denied a petition for mandamus directing Judge Albright to stay all deadlines unrelated to venue pending a decision on transfer. In In re True Chemical Solutions (Fed. Cir. No. 21-131), the court denied a petition for mandamus reversing Judge Albright’s grant of a motion for intra-division transfer. Notably, Judge Albright now oversees 20% of new US patent cases (link).

Blaine H. Evanson – Orange County (+1 949-451-3805, bevanson@gibsondunn.com)
Jessica A. Hudak – Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group:
Allyson N. Ho – Dallas (+1 214-698-3233, aho@gibsondunn.com)
Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

This edition of Gibson Dunn’s Federal Circuit Update summarizes the three pending Supreme Court cases originating in the Federal Circuit and key filings for certiorari review. We address the Federal Circuit’s announcement that it will now offer a live audio streaming program for oral argument. And we discuss other recent Federal Circuit decisions concerning induced infringement via “skinny labels,” patent term adjustment, motions to transfer from the Western District of Texas, and whether anticipation is inherent in an obviousness theory.

Federal Circuit News

Supreme Court:

In February, the Supreme Court did not add any new cases originating in the Federal Circuit. It has three such cases pending.

United States v. Arthrex, Inc. (U.S. Nos. 19-1434, 19-1452, 19-1458): On Monday, March 1, the Court heard argument on the question of whether PTAB administrative patent judges are principal Officers and therefore unconstitutionally appointed in violation the Appointments Clause. Gibson Dunn partner Mark Perry argued for Smith & Nephew.

Minerva Surgical Inc. v. Hologic Inc. (U.S. No. 20-440): As we summarized in our January 2021 update, the Supreme Court granted certiorari to determine the viability of the assignor estoppel doctrine, which bars assignors from challenging the patent’s validity in district court. Minerva Surgical filed its opening brief on the merits asking the Court to eliminate assignor estoppel. Engine Advocacy filed a brief in support. Hologic’s brief is due at the end of March.

Google LLC v. Oracle America, Inc. (U.S. No. 18-956): As we summarized in our January 2021 update, the Court is considering whether copyright protection extends to a software interface and, if so, whether Google’s use constitutes fair use. The Court heard argument on October 7, 2020.

Noteworthy Petitions for a Writ of Certiorari:

There are three potentially impactful petitions currently before the Supreme Court.

As we summarized in our January 2021 update, petitioners in American Axle & Manufacturing, Inc. v. Neapco Holdings LLC (U.S. No. 20-891) and Ariosa Diagnostics, Inc. v. Illumina, Inc. (U.S. No. 20-892) both raise questions related to patent eligibility under 35 U.S.C. § 101. The Court has requested responses to both petitions, which are due March 21, 2021, and April 19, 2021, respectively.

The Court also requested a response in Argentum Pharmaceuticals LLC v. Novartis Pharmaceuticals Corporation (U.S. No. 20-779), which Novartis filed on February 16, 2021. The question presented is whether the Federal Circuit correctly found that Argentum’s evidence of alleged injury was insufficient to establish Article III standing. Gibson Dunn partners Mark Perry and Jane Love are counsel for Novartis.

Other Federal Circuit News:

In GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc. (Fed. Cir. No. 18-1976), on February 9, 2021, the panel granted panel rehearing, vacated the judgment, withdrew its October opinion, and ordered a second oral argument, which it held on February 23, 2021. On October 2, 2020, a panel (Newman, J., joined by Moore, J.) vacated the district court’s grant of JMOL and reinstated the jury verdicts of infringement and damages. Over Chief Judge Prost’s dissent, the panel majority held that Teva induced infringement of GSK’s patent by marketing its generic carvedilol, even though the “skinny label” carved out the infringing method. Teva petitioned for rehearing on the question of whether a generic manufacturer can “be held liable for induced infringement based on evidence that would be available in every carve-out case.” Three amicus briefs were filed before the panel’s initial decision, and eight amicus briefs were filed in support of rehearing.

Federal Circuit Practice Update

Live streaming audio of oral argument. Beginning this week, as part of the Federal Circuit’s ongoing response to the COVID-19 pandemic, the court will offer a new live audio streaming program for oral argument panels. For the March 2021 session, Panels B, E, H, K, and N will have daily live streaming audio on the Federal Circuit’s new YouTube channel. Connection information is posted on the court’s website on the first day of the month’s session. The court anticipates that, by the April session, all oral arguments will be live audio streamed online while the courthouse remains closed to the public.

Upcoming Oral Argument Calendar

The list of upcoming arguments at the Federal Circuit are available on the court’s website.

Key Case Summaries (February 2021)

Amgen, Inc. v. Sanofi (Fed. Cir. No. 20-1074): Amgen appealed from the district court’s grant of JMOL of lack of enablement of its claims to antibodies that bind to a protein and block it from binding to low-density lipoprotein (“LDL”) receptors (elevated LDL cholesterol is linked to heart disease). The claimed antibodies are defined by their function: binding to a combination of sites on the protein and blocking the protein/LDL receptor interaction. The district court concluded, based on the Wands factors, that the claims are not enabled because they require undue experimentation.

The panel (Lourie, J., joined by Prost, C.J., and Hughes, J.) affirmed. The panel explained that, under the court’s precedents, “the enablement inquiry for claims that include functional requirements can be particularly focused on the breadth of those requirements, especially where predictability and guidance fall short.” It further explained that “[w]hile functional claim limitations are not necessarily precluded in claims that meet the enablement requirement, such limitations pose high hurdles in fulfilling the enablement requirement for claims with broad functional language.” The panel held that the claims were not enabled because undue experimentation would be required to practice the full scope of these claims.

In re: SK hynix Inc. (Fed. Cir. No. 21-113): SK hynix petitioned for a writ of mandamus directing the district court (Judge Albright in the Western District of Texas) to transfer the underlying case to the Central District of California. On May 4, 2020, SK hynix moved to transfer the case and, although briefing was complete by May 26, 2020, the court had yet to rule. Meanwhile, Judge Albright ordered the parties to engage in extensive discovery and scheduled a Markman hearing for March 19, 2021. After SK Hynix petitioned the Federal Circuit, on January 28, 2021, the district court issued an order setting a hearing on the transfer motion for the morning of February 2, 2021.

The panel (Moore, J., joined by Newman and Stoll, JJ.) granted the petition to the extent that the district court must stay all proceedings concerning the substantive issues of the case and all discovery until such time that it has issued a ruling on the transfer motion. The panel agreed with SK hynix that the district court’s handling of the transfer motion “amounted to [an] egregious delay and blatant disregard for precedent,” and that disposing of transfer motions should “unquestionably take top priority.”

In re: SK hynix Inc. (Fed. Cir. No. 21-114): The day after the court granted SK hynix’s petition, the district court denied its transfer motion and issued an opinion with its reasoning. SK hynix petitioned for mandamus again. The panel (Taranto, J., joined by Dyk and Bryson, JJ.) denied the petition, concluding that SK hynix had not shown that the district court clearly abused its discretion.

M & K Holdings, Inc. v. Samsung Electronics Co. (Fed. Cir. No. 20-1160): M & K Holdings appealed from a Board decision in an IPR proceeding that all claims are unpatentable. M&K argued that the Board erred by finding one claim anticipated when the petition for IPR asserted only obviousness as to that claim. Although the Board stated it was holding that claim to be invalid as obvious, the Board’s analysis of the patentability of the claim was based on anticipation, not obviousness.

The panel (Bryson, J., joined by Moore and Chen, JJ.) vacated the Board’s holding that the claim is unpatentable, reasoning that the Board’s reliance on anticipation deprived M&K of the notice it was due. The panel explained that the Board’s anticipation finding was “not inherent” in Samsung’s obviousness theory. And, in fact, Samsung’s position before the Board contradicted such a conclusion. M&K was not put on notice that the Board might find that the reference disclosed all of the claim limitations and might invalidate the claim based on anticipation. That amounted to a “marked deviation” from the invalidity theory set forth in Samsung’s petition.

Chudik v. Hirshfeld (Fed. Cir. No. 20-1833): Dr. Chudik’s patent issued eleven and a half years after the application was filed. The PTO ultimately awarded Dr. Chudik a patent term adjustment of 2,066 days under 35 U.S.C. § 154(b), but it rejected Dr. Chudik’s argument that he was entitled to an additional 655 days, under 35 U.S.C. § 154(b)(1)(C)(iii) (C-delay), for the time his four notices of appeal were pending in the PTO. The PTO concluded that the provision does not apply here because the examiner reopened prosecution during each of his four appeals so the Board never had jurisdiction. The district court affirmed the PTO’s decision (35 U.S.C. § 154(b)(4)(A)).

The panel (Taranto, J., joined by Bryson and Hughes, JJ.) also affirmed. The panel held that, under any framework (Chevron or not) and even without Skidmore deference, the best interpretation of the statutory language is the one the PTO adopted.

Blaine H. Evanson – Orange County (+1 949-451-3805, bevanson@gibsondunn.com)
Jessica A. Hudak – Orange County (+1 949-451-3837, jhudak@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group:
Allyson N. Ho – Dallas (+1 214-698-3233, aho@gibsondunn.com)
Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

We are pleased to present Gibson Dunn’s eighth “Federal Circuit Year In Review,” providing a statistical overview and substantive summaries of the 130 precedential patent opinions issued by the Federal Circuit between August 1, 2019 and July 31, 2020. This term was marked by significant panel decisions with regard to the constitutionality of the PTAB and its jurisdiction and procedures (Arthrex, Inc. v. Smith & Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019), Samsung Electronics America, Inc. v. Prisua Engineering Corp., 948 F.3d 1342 (Fed. Cir. 2020), and Nike, Inc. v. Adidas AG, 955 F.3d 45 (Fed. Cir. 2020)), subject matter eligibility (American Axle & Manufacturing, Inc. v. Neapco Holdings LLC, 967 F.3d 1285 (Fed. Cir. 2020) and Illumina, Inc. v. Ariosa Diagnostics, Inc.,952 F.3d 1367 (Fed. Cir. 2020)), and venue (In re Google LLC). The issues most frequently addressed in precedential decisions by the Court were: obviousness (43 opinions); infringement (24 opinions); claim construction (22 opinions); PTO procedures (21 opinions); and Jurisdiction, Venue, and Standing (19 opinions).

Use the Federal Circuit Year In Review to find out:

The easy-to-use Table of Contents is organized by substantive issue, so that the reader can easily identify all of the relevant cases bearing on the issue of choice.
Which issues may have a better chance (or risk) on appeal based on the Federal Circuit’s history of affirming or reversing on those issues in the past.
The average length of time from issuance of a final decision in the district court and docketing at the Federal Circuit to issuance of a Federal Circuit opinion on appeal.
What the success rate has been at the Federal Circuit if you are a patentee or the opponent based on the issue being appealed.
The Federal Circuit’s history of affirming or reversing cases from a specific district court.
How likely a particular panel may be to render a unanimous opinion or a fractured decision with a majority, concurrence, or dissent.
The Federal Circuit’s affirmance/reversal rate in cases from the district court, ITC, and the PTO.

The Year In Review provides statistical analyses of how the Federal Circuit has been deciding precedential patent cases, such as affirmance and reversal rates (overall, by issue, and by District Court), average time from lower tribunal decision to key milestones (oral argument, decision), win rate for patentee versus opponent (overall, by issue, and by District Court), decision rate by Judge (number of unanimous, majority, plurality, concurring, or dissenting opinions), and other helpful metrics. The Year In Review is an ideal resource for participants in intellectual property litigation seeking an objective report on the Court’s decisions.

Gibson Dunn is nationally recognized for its premier practices in both Intellectual Property and Appellate litigation. Our lawyers work seamlessly together on all aspects of patent litigation, including appeals to the Federal Circuit from both district courts and the agencies.

Please click here to view the FEDERAL CIRCUIT YEAR IN REVIEW

Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)
Omar F. Amin – Washington, D.C. (+1 202-887-3710, oamin@gibsondunn.com)
Nathan R. Curtis – Dallas (+1 214-698-3423, ncurtis@gibsondunn.com)

Please also feel free to contact any of the following practice group co-chairs or any member of the firm’s Appellate and Constitutional Law or Intellectual Property practice groups:

Appellate and Constitutional Law Group:
Allyson N. Ho – Dallas (+1 214-698-3233, aho@gibsondunn.com)
Mark A. Perry – Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com)

Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.