IP Update, Vol. 16, No. 8, August 2013

Edited by Paul Devinsky and Rita Weeks

IN THIS ISSUE

Patents

President Disapproves ITC Exclusion Order

Patent Claims Are Indefinite Where Claimed "Molecular Weight" Subject to Different Calculations

A Generic Disclosure Does Not Support Claims to Individual Species

A Negative Claim Limitation Must Be Supported by the Specification

Objective Indicia of Non-Obviousness Must Be Considered Before Concluding Patent Claims Are Obvious

Has the Doctrine of Claim Vitiation Itself Been Vitiated?

Detailed Explanation Not the Same as a New Ground for Rejection

Royalty Payments for Hybrid Agreements Covering Inseparable Patent and Non-Patent Rights End When the Patent Expires

Contract Has Latent Ambiguity if Objective Evidence Supporting Reasonable Alternative Meaning Exists

Trademarks

Use of Athlete's Likeness in Video Game Not Protected by First Amendment

Touchdown for Video Game Producer Over Football Players False Endorsement Claim

No Initial-Interest Confusion, No Lanham Act Violation

Default Judgment Affirmed Against Imposter

Who Arbitrates Arbitrability?

Copyrights

It's the Words, Not the Ideas, that Are Copyrightable

Owner of Compilation Need Not List Individual Authors to Register Copyright

No Preliminary Injunction Over Commercial Hopping

Patents / ITC

President Disapproves ITC Exclusion Order

by Christopher G. Paulraj

For the first time since the administration of President Ronald Reagan, an exclusion order issued by the U.S. International Trade Commission (ITC) has been disapproved by the president on policy grounds. On August 3, 2013, U.S. Trade Representative (USTR) Michael Froman, acting under the authority of President Obama, sent a letter to the ITC noting his disapproval of the ITC's determination to issue an exclusion order in "Certain Electronic Devices, Including Wireless Communication Devices, Portable Music and Data Processing Devices, and Table Computers, Investigation No. 337-TA-794." The letter explained that the USTR's disapproval was based on various policy considerations and particularly emphasized the harms associated with "patent hold-up" that are caused when exclusionary relief is sought for standards essential patents (SEPs) that are subject to voluntary commitments to be licensed on fair, reasonable and non-discriminatory (FRAND) terms.

In the 794 investigation, the complainant, Samsung Electronics, asserted two patents previously declared to be "standards essential" to the Universal Mobile Telecommunications System promulgated by the European Telecommunications Standards Institute (ETSI) and therefore subject to FRAND licensing commitment. After licensing negotiations between Samsung and the respondent, Apple, broke down, Samsung filed a complaint at the ITC requesting a limited exclusion order against certain of Apple's mobile communication products. In its final determination, the ITC found one of the two patents asserted by Samsung to be both valid and infringed, ruling that the proper relief was a limited exclusion and cease-and-desist order.

On review of the ID by the full ITC, the ITC rejected Apple's theory that the ITC "cannot address infringement of standard-essential patents other than in the exceptional scenarios such as where a potential licensee has refused to pay a royalty after a U.S. court has determined that royalty to be FRAND, or where no U.S. court has jurisdiction over the potential licensee in order to set a FRAND rate," ruling that the remedies provided under §337 could be imposed in addition to any damages or injunctions available from a district court. The ITC also rejected Apple's position that the fact that a patent has been declared standard-essential should be considered as part of the public interest analysis.

In accordance with 19 U.S.C. §1337(j), the president has the authority to disapprove "for policy reasons" any ITC determination finding a violation of Section 337. The president may disapprove an ITC order on policy grounds, approve an order, or take no action and allow the order to come into force upon the expiration of a 60-day review period following the issuance of the order by the ITC. Through an executive order in 2005, President Bush delegated this authority to the USTR.

In his August 3 letter, the USTR took into account the following considerations as being relevant to the policy review of the impact of the ITC's determination to issue an exclusion order: public health and welfare; competitive conditions in the U.S. economy; production of competitive articles in the United States; U.S. consumers; and U.S. foreign relations, economic and political. In analyzing these considerations, the USTR relied heavily upon the "Policy Statement on Remedies for Standard-Essential Patents Subject to Voluntary RAND Commitments" issued jointly by the U.S. Department of Justice (DOJ) and the U.S. Patent and Trademark Office (PTO) on January 8, 2013. As noted in the DOJ/PTO Policy Statement, the Obama administration expressed "substantial concerns" about the undue leverage that results when the holder of an SEP seeks to exclude an implementer of a technology standard from a market in order to leverage a higher price for use of the patent than would have been possible before the standard was set, i.e., when alternative technologies could have been chosen.

The USTR further noted that "exclusionary relief from the Commission based on FRAND-encumbered SEPs should be available based only on the relevant factors described in the Policy Statement." As explained by the USTR, "an exclusion order may still be an appropriate remedy in some circumstances, such as where the putative licensee is unable or refuses to take a FRAND license and is acting outside the scope of the patent holder's commitment to license on FRAND terms." The Policy Statement noted, as examples, the situation where "a putative licensee refuses to pay what has been determined to be a FRAND royalty, or refuses to engage in a negotiation to determine F/RAND terms," which may also include a "constructive refusal to negotiate, such as by insisting on terms clearly outside the bounds of what could reasonably be considered to be F/RAND terms in an attempt to evade the putative licensee's obligation to fairly compensate the patent holder." Additionally, the Policy Statement noted that "[a]n exclusion order also could be appropriate if a putative licensee is not subject to the jurisdiction of a court that could award damages."

Patents / Indefiniteness

Patent Claims Are Indefinite Where Claimed "Molecular Weight" Subject to Different Calculations

Teva Pharmaceuticals USA v. Sandoz Inc. by Kristin Connarn

Addressing the issues of indefiniteness and enablement of pharmaceutical products, the U.S. Court of Appeals for the Federal Circuit upheld judgments of infringement and no validity with respect to one group of claims and reversed judgment of no invalidity with respect to another group of claims. Teva Pharmaceuticals USA v. Sandoz Inc., Case Nos. 12-1567, -1568, -1569, -1570 (Fed. Cir., July 26, 2013) (Moore, J.).

Teva sued several companies for patent infringement after they submitted Abbreviated New Drug Applications (ANDAs) to market generic versions of Copaxone®. At least seven of the eight Orange Book listed patents were asserted.

The active ingredient is copolymer-1, or glatiramer acetate, which is a polypeptide product that consists of four different amino acids (alanine, glutamic acid, lysine, and tyrosine). Copolymer-1, however, is a mixture of individual polymer molecules with different constituent ratios and different molecular weights (often expressed as "average molecular weight").

The Federal Circuit reaffirmed a principle of patent law by holding that because the claim term "molecular weight" can be calculated at least three different ways—peak average molecular weight (Mp), number average molecular weight (Mn), and weight average molecular weight (Mw)—resulting in three different values, the asserted claims were invalid for indefiniteness. This is because it is not possible to determine whether potential infringing activity will fall within the scope of the claims.

However, the Court also held that at least some of the claims that included this term, but which described in the claim how to calculate "molecular weight," were not indefinite (the Group II claims). In this case, the molecular weight was not expressed as a statistical measure, but rather the percentage of copolymer-1 molecules that fall within a defined range. As a result, the measurement was not dependent on the type of calculation performed because it required a determination of the actual values.

In addition, the Court determined that there was insufficient evidence to overturn the lower court's determinations that the asserted claims were enabled, not obvious, and infringed. Thus Teva's injunction of the various ANDA filers was maintained. However, because one of the seven patents expires after all of the others (in 2015, instead of 2014), the Federal Circuit remanded the case to the lower court to determine the impact on the length of the injunction.

Patents / Written Description

A Generic Disclosure Does Not Support Claims to Individual Species

Novozymes A/S v. DuPont Nutrition Biosciences APS

by K. Nicole Clouse, Ph.D.

Addressing the issue of written description as it relates to a genus and related species, the U.S. Court of Appeals for the Federal Circuit upheld a district court's post-trial grant of a motion for judgment as a matter of law that claims were invalid for lack of written description, finding that a description of a genus does not provide sufficient written description of claims to particular undisclosed species. Novozymes A/S v. DuPont Nutrition Biosciences APS, Case No. 12-1433 (Fed. Cir., July 22, 2013) (Schall, J.) (Rader, J., dissenting).

Plaintiff Novozymes filed a patent application in 2000 describing improved variants of alpha-amylase proteins used in commercial-scale ethanol...