Federal Circuit

Federal Circuit - The FindLaw Federal Circuit Court of Appeals Opinion Summaries Blog


This circuit. This glorious Federal Circuit, with its unique, specialized jurisdiction over a few niche areas of law. Typically, this circuit's run-of-the-mill patent decisions are a bit dry.

But 2014 was different. This past year brought a whole lot of Supreme Court intervention, a scandal that led to a resignation and reprimand, and a new chief judge. In other words: juicy blog material.

Here's what you found most interesting, judging by traffic numbers:

Over here at FindLaw's Federal Circuit blog, we're no fans of business method patents. Every chance we get, we write about, and celebrate, another Federal Circuit opinion using Alice v. CLS Bank to invalidate phony baloney "on a computer" method patents.

After a string of Alice success stories, in which the Federal Circuit struck patents for regular old, ordinary, analog things done on a computer, the court has upheld a business method patent because the problem the patent sought to solve actually was something unique to the Internet.

The "entire market value rule" (EMVR) is a way of limiting damages on patent infringement. It requires the prevailing party in a patent infringement case to base its damages only on the value of the infringing component in a device, not the value of the entire device itself.

Ericsson sued big-name makers of network technology like D-Link and Netgear, and computer manufacturers like Toshiba and Dell, claiming they made devices with 802.11n-compliant wireless chips and therefore needed a license.

Ericsson won at trial, but the real question on appeal is whether its damage award broke the EMVR.

Following Alice v. CLS Bank last term, all those "on a computer" business method patents were seriously called into question. We've seen new lawsuits spring up over invalidating old patents, and Alice get invoked in current litigation over "on a computer" patents.

One of the highest-profile cases was Ultramercial v. Hulu, also known as the WildTangent case for one of its other defendants. The short, short version is that Ultramercial owns a patent that purports to cover viewing free streaming videos online in exchange for watching a little advertising throughout -- basically, exactly what Hulu and YouTube do.

Last week, an en banc panel of the Federal Circuit bench-slapped the other party in the e-mail scandal that led to Chief Judge Randall Rader's retirement. This week, the same court is preparing for a possible new colleague, as there is a nominee to fill Rader's now-vacant seat.

Enter Kara Farnandez Stoll, a partner in the largest firm that practices intellectual property exclusively: Finnegan, Henderson, Farabow, Garrett & Dunner LLP (or Finnegan for short). President Barack Obama announced Stoll's nomination Wednesday, and she'll face a post-midterm Republican-controlled Senate during her confirmation process now that the elections are over.

Everyone remembers the scandal that led to Chief Judge Randall R. Rader's resignation earlier this year, right? The Chief sent an email to his buddy, Edward Reines, a patent attorney at Weil Gotshal's Silicon Valley office. The email related a third-party judge's comments that Reines was "IMPRESSIVE in every way," and Rader added: "I was really proud to be your friend," before encouraging Reines to let others see the message.

Chief Rader stepped aside, but the scandal apparently wasn't over. On Wednesday, the Federal Circuit issued a rare en banc bench-slapping of Reines over his use of the laudatory email -- and forwarded a second friendly gesture between the two pals to the California State Bar for further proceedings.

Did Reines cross the line by taking Rader up on his suggestion to share the email? Or is this much ado about two buddies sharing compliments and concert tickets?

Halo Electronics makes electronic packages for use on printed circuit boards. It has three patents on this technology, filed in 1995. Pulse Electronics also makes electronic packages for use on printed circuit boards. Uh oh. Thankfully, though, Pulse only sells its products in Asia.

Or does it? After Pulse incorporated some of its electronics into equipment sold by Cisco in the United States, Halo sent Pulse a polite letter asking if Pulse would like to enter into a license agreement. A Pulse engineer determined that Halo's patents were not invalid. Pulse never consulted a lawyer and kept selling its products anyway.

Patents are supposed to be issued for new and novel things, not things that anybody could have come up with. A patent can be invalidated for "obviousness" if the thing that is to be patented is based on prior art and that thing would have been obvious to a person of ordinary skill in that field.

In the field of pharmaceuticals, a drug can be considered obvious if it's the made by adding something to an extant chemical -- something that anyone could have done and the result of which anyone would have expected. But what about after it's patented? That doesn't work, affirmed the Federal Circuit, in a divided opinion over a rehearing en banc in Bristol-Myers Squibb v. Teva Pharmaceuticals.

The Harmonized Tariff Schedule of the United States is a 3,000-page book that classifies every single thing that enters the country, all for the purpose of determining how to tax it when it gets here. For example, black tea is free, but flavored green tea will cost the importer 6.4 percent. A T-shirt made of man-made fibers has a whopping 32 percent tariff, but if it's cotton, then it's only 16.5 percent.

The point is that how you classify something makes a big difference when it comes to paying taxes. Victoria's Secret, like most clothing companies, manufactures clothes overseas and then imports them. They make something called a Bra Top and another thing called a Bodyshaper. The Court of International Trade said these were "other garments, knitted or crocheted," which requires a 10.8 percent tariff. Victoria's Secret, on the other hand, says they should be considered "brassieres, girdles, corsets [...] and other similar articles and parts thereof." That's only 6.6 percent.

Ah, the Federal Circuit. It's like the spooky basement of the federal judiciary, that place where even seasoned appellate attorneys are afraid to go. "There might be ... patent litigation down there!" they exclaim.

And, in truth, since the last time we covered the Federal Circuit, there has been a bit of patent litigation. So here's a roundup of what's been going on in the Spooky Basement Circuit Court of Appeals.