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Intellectual Property

Is There a "Death Squad" at the U.S. Patent Office?: Examining the Patent Trial and Appeal Board

Free Lunch Podcast featuring Josh Malone, Kristen Osenga, and Brian O’Shaughnessy
Josh Malone, Kristen Osenga, Brian O’Shaughnessy, Devon Westhill August 21, 2017

In 2011, Congress created a new administrative tribunal in the U.S. Patent Office with the power to cancel previously granted patents, called the Patent Trial and Appeal Board (PTAB).  The PTAB was created to provide an efficient and inexpensive administrative process for eliminating low-quality patents – what are called “bad patents.” Despite its laudable purpose, the PTAB has earned a reputation among some as a prime example of regulatory overreach.  The PTAB’s critics cite a wide range of concerns including inadequate due process protections and bias against patents.  A former federal appellate chief judge even referred to PTAB administrative judges as “patent death squads.”  So, is the PTAB indeed harming the property rights that have helped to drive the U.S. innovation economy for over 200 years or, is it functioning as intended?  What are the concerns of its detractors?  If these concerns are valid, does the PTAB need simple reform or more?

This teleforum is held in conjunction with the Monday, August 14 release of a paper authored by members of the Regulatory Transparency Project’s Intellectual Property Working Group.  The paper is called “Crippling the Innovation Economy: Regulatory Overreach at the Patent Office.”  This paper, which discusses this new administrative tribunal at the Patent Office, is available for viewing and download at RegProject.org.

 

Featuring: 

  • Josh Malone, Inventor, Bunch O Balloons 

  • Kristen Osenga, Professor, University of Richmond School of Law 

  • Brian O’Shaughnessy, Partner, Dinsmore & Shohl LLP 

  • Devon Westhill, Director, Regulatory Transparency Project (Moderator) 

Patents and Antitrust, Worldwide - Podcast

Intellectual Property Law Practice Group Podcast
Maureen K. Ohlhausen, Alexander Okuliar August 17, 2017

The smartphone patent wars have caused a great deal of litigation and consternation. As global patent litigation has accelerated, an international arms race characterized by competing alliances and massive portfolio acquisitions ensued. One recurring claim was "hold-up": certain patent owners, having given assurances that they would license their essential technologies on reasonable and nondiscriminatory (RAND) terms, sought to enjoin smartphone makers from practicing industry standards. Charged with protecting consumers, antitrust enforcers experienced pressure to do something.

The FTC and other competition agencies responded aggressively, clamping down on perceived efforts by owners of RAND-encumbered SEPs to hold-up standard implementers. They happened upon the rule that such patentees violate antitrust law if they try to enjoin a “willing licensee”—essentially a “no-injunction rule.” While that approach has intuitive appeal, is it consistent with core antitrust principles? Does the no-injunction properly consider whether the relevant conduct harms competition?  Have the U.S. Federal Trade Commission's actions emboldened foreign competition agencies to act aggressively?  These and other questions were addressed.

Featuring:

  • Hon. Maureen K. Ohlhausen, Acting Chairman, Federal Trade Commission
  • Mr. Alex Okuliar, Partner, Orrick, Herrington & Sutcliffe LLP

TC Heartland LLC v. Kraft Foods Group Brands LLC - Post-Decision SCOTUScast

SCOTUScast 8-11-17 featuring J. Devlin Hartline
J. Devlin Hartline August 11, 2017

On May 22, 2017, the Supreme Court decided TC Heartland LLC v. Kraft Foods Group Brands LLC,  a dispute over the proper venue for a patent infringement suit.  Section 1400(b) of the patent venue statute states in relevant part that a civil action for patent infringement may be brought in the judicial district “where the defendant resides.”  In the 1957 case Fourco Glass Co. v. Transmirra Prods. Corp, the Supreme Court held that for purposes of section 1400(b) a domestic corporation “resides” only in its State of incorporation--a narrower understanding of corporate “residence” than that applicable under section 1391 of the general venue statute.  Under section 1391, a corporate defendant is typically deemed to reside in any judicial district where it is subject to the court’s “personal jurisdiction” with respect to the civil action in question.

TC Heartland LLC (Heartland) is organized under Indiana law and headquartered there. Kraft Food Brands LLC (Kraft) sued Heartland in federal district court in Delaware (where Kraft is organized), alleging that products Heartland shipped to Delaware infringed on Kraft’s patents for similar products. Heartland moved to dismiss the claim or transfer venue to Indiana, arguing that it did not reside in Delaware for purposes of section 1400(b).  The district court rejected these arguments and the U.S. Court of Appeals for the Federal Circuit denied mandamus relief, because its circuit precedent had concluded that more recent statutory amendments to section 1391 had effectively superseded the Fourco interpretation of “reside” in section 1400(b) and thus the broader understanding expressed in section 1391 now applied to section 1400(b) too.

By a vote of 8-0, the Supreme Court reversed the judgment of the Federal Circuit and remanded the case. In an opinion by Justice Thomas, the Court held that the amendments to section 1391 did not modify the meaning of section 1400(b) as interpreted in Fourco; as applied to domestic corporations, “residence” for purposes of section 1400(b) still refers only to the state of incorporation.  All other members of the Court joined in Justice Thomas’ opinion except Justice Gorsuch, who took no part in the consideration or decision of this case.

And now, to discuss the case, we have J. Devlin Hartline, who is Director, Center for the Protection of Intellectual Property (CPIP) and Adjunct Professor, Antonin Scalia Law School, George Mason University.

Sandoz, Inc. v. Amgen, Inc. Post-Decision SCOTUScast

SCOTUScast 8-11-17 featuring Erika Lietzan
Erika Lietzan August 11, 2017

On June 12, 2017, the Supreme Court decided Sandoz, Inc. v. Amgen, Inc. consolidated with Amgen Inc. v. Sandoz Inc. 

The Biologics Price Competition and Innovation Act of 2009 (BPCIA) provides an abbreviated pathway for obtaining Food and Drug Administration (FDA) approval of a drug that is biosimilar to an already licensed biological product.  Among other things, BPCIA provisions require applicants for approval of a new biosimilar to provide the manufacturer of the already licensed product with a notice of commercial marketing and certain information about the biosimilar.  Failure to comply permits the manufacturer to pursue infringement litigation against the applicant on an accelerated basis.

Amgen claims to hold patents on methods of manufacturing and using filgrastim--a biologic used to stimulate the production of white blood cells--and markets one such product, Neupogen. Sandoz sought FDA approval to market a biosimilar called Zarxio.  When the FDA accepted Sandoz’s application for review, Sandoz notified Amgen that Sandoz intended to market Zarxio upon receipt of FDA approval.  Sandoz also indicated that it would not share with Amgen the relevant application and manufacturing information as required by the BPCIA and invited Amgen immediately to sue for infringement.  Amgen did so, and further asserted claims for “unlawful” conduct in violation of California’s unfair competition law.  The basis for the latter claims was Sandoz’s alleged failure to comply with the BPCIA requirements that Sandoz (a) share the application and manufacturing information pertaining to Zarxio, and (b) provide a notice of commercial marketing prior to obtaining FDA licensure.  Amgen sought injunctive relief in federal district court to enforce both requirements against Sandoz, which counterclaimed for declaratory judgments that Amgen’s patent was invalid and not infringed, and that Sandoz had not violated the BPCIA.

While the litigation was pending, the FDA licensed Zarxio, and Sandoz provided Amgen with further notice of commercial marketing.  The district court thereafter granted partial judgment in favor of Sandoz on its BPCIA counterclaims and dismissed Amgen’s unfair competition claims with prejudice.  A divided U.S. Court of Appeals for the Federal Circuit affirmed in part, vacated  in part, and remanded the case.  The Federal Circuit held that Sandoz had not violated the BPCIA disclosure requirements and that Amgen could not pursue state law remedies to enforce the BPCIA.  The court also held that an applicant may provide effective notice of commercial market only after FDA licensure and therefore enjoined Sandoz from marketing Zarxio until 180 days passed after Sandoz’s second notice.

By a vote of 9-0, the Supreme Court unanimously vacated in part and reversed in part the judgment of the Federal Circuit and remanded the case. In an opinion by Justice Thomas, the Court held that the BPCIA’s requirement on sharing application and marketing information is not enforceable by an injunction under federal law, but that the Federal Circuit should determine on remand whether a state-law injunction is available.  The Supreme Court further held that an applicant may provide the requisite notice of commercial marketing before obtaining FDA licensure; therefore Sandoz fully complied with this requirement through its initial notice, the Federal Circuit erred in enjoining Sandoz from marketing Zarxio on this basis, and Amgen’s state law unfair competition claim predicated on the view that the BPCIA forbids pre-licensure notice must fail.  Justice Breyer issued a concurring opinion.

And now, to discuss the case, we have Erika Lietzan, who is Associate Professor of Law at the University of Missouri School of Law.

Reauthorization of Section 702 - Podcast

International & National Security Law Practice Group Podcast
Adam T. Klein, Kate Martin, Karen J. Lugo July 19, 2017

Section 702 of the Foreign Intelligence Surveillance Act (FISA) is up for reauthorization in 2017. An earlier version of the program was instituted after 9/11 by President George W. Bush. In 2007, Congress adopted the Protect America Act and one year later passed the FISA Amendments Act, which included Section 702. Section 702 allows the government to target for surveillance non-U.S. citizens “reasonably believed to be located outside the United States to acquire foreign intelligence information.” The authorization does not extend to non-citizens outside the country to gain information on citizens or permanent residents believed to be residing in the United States.

While proponents of the law argue it is necessary for national security, critics claim that U.S. citizens are too often incidentally swept into surveillance due to the nature of the “targeting procedures” employed by intelligence agencies, and therefore reforms are needed to protect their privacy. Our experts discussed reauthorization, what it would mean if Congress chose not to act, and what kinds of reforms are under consideration.

.Featuring: 

  • Adam Klein, Senior Fellow, Center for a New American Security
  • Kate Martin, Senior Fellow, Center for American Progress 
  • Moderator: Karen Lugo, Founder, Libertas-West Project