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Patent
Wayne State University Law School
White, Katherine E.

Class Notes – Patent Law Fall 2007

Week 1: (August 27-August 31) Introduction to Patent Law, Patent Eligibility, Biotechnology

1 – 26

Patent law is one area of law that requires case law to interpret the statues (35 U.S.C.)

England – patent law springs from laws of monopoly.

US – Constitution Article I, sec. 8, cl. 8: Congress has the power, “to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to there respective works.”

Patent term – used to be 17 years from date of issue, now it is 20 years from date of filing.

Trademark – no term limit, more of a consumer protection mechanism. Can loose a trademark if it becomes generic (i.e. aspirin)

Copyright – creative work, low threshold of originality, life of the author + 70 years, works for hire – 125 years.

Trade Secret – secret used by a company to manufacture / make there product. If it gets out, it is no longer a secret (only protection is that others do not know it).

Bonito Boats, Inc. v. Thunder Craft Boats Inc.
489 U.S. 141
U.S. Supreme Court, 1989

Nature: Appeal from judgment striking down a statute prohibiting “direct molding process” in reproducing unpatented designs.

Facts: Bonito Boats, Inc. (P) fiberglass recreational hull was molded and reproduced by Thnder Craft (D), whereupon Bonito (P) sued in state court under a Florida statute prohibiting direct molding of unpatented designs.

Issue: May states offer patent-like protections to intellectual creations that would otherwise remain unprotected as a matter of federal law?

Holding: No. Article 1 § 8 cl. § 8 of the Constitution (The Patent and Copyright Clause) reflects a balance between the need to encourage innovation and the avoidance of monopolies that stifle competition. Imitation and refinement through imitation lead to innovation, yet there must be an incentive to disclose the innovation to the public, hence the grant of a time-constrained monopoly. The inventor could keep his invention a secret and reap its fruits indefinitely, but federal law rewards its disclosure and the benefit to the community this way. The attractiveness of the bargain depends on a backdrop of free competition in unpatented designs and innovations. These are fostered by the non-obvious and novelty requirements of patent registry. But where state laws grant protections for designs and technologies, this balance is upset, and disclosure and reward are reprioritized. The federal decision to forgo regulation of unpatentable designs is a determination that some ideas are protected while others should be free use, not that the unpatentable should be protected by the states. The 1964 decisions – Sears, Roebuck, and Co. v. Stiffel and Compco Corp. v. Day-Brite Lighting, Inc. – addressed federal preemption of the patent and copyright fields, yet these cases still foster debate. Both the Sears and Compco descisions represent the belief that for federal regulation to work, there must be substantially free trade in publicly known, unpatented design and utilitarian concepts. State laws that interfere in this free trade by the creation of patent-like rights upset the goal of public disclosure and redirect inventive efforts away from 200 years of patentability criteria set out by Congress. The Florida statute violates the teachings of Sears and Compco. With notable exceptions, the common law tort of unfair competition has been limited to protection against copying of non-functional aspects of consumer products which have acquired secondary meaning such that they operate as a designation of source. Consumer confusion as to source is the concern, not the functional design “ideas.” In contrast, the Florida statute prohibits free access to the public domain of ideas, hindering refinement and innovation. With the competitive reality of reverse-engineering (as the molding process is) the inventor is spurred to develop designs that are worthy of patent requirements. Florida’s patent-like protections compete with federal standards and create administrative conflicts. National uniformity must be preserved, and Congress must determine what those standards are to be. Affirmed.

States may not offer patent-like protections to intellectual creations that would otherwise remain unprotected as a matter of federal law.

In Re Bergy
596 F.2d 952

Claims of an application serial No. 260,563 entitled “Microorganism Having Multiple, Compatible, Degradative Energy-Generating Plasmid and Preparation Thereof” and claims made in separate action of application serial No. 477,766, relating to biologically pure culture of microorganisms Streptomyces vellosus were rejected by the examiner. The Court of Customs and Patent Appeals, Rich, J., 563 F.2d 1031 reversed the United States Patent and Trademark Office Board of Appeals which had affirmed findings of examiner, and certiorari was sought. The United States Supreme Court, 438 U.S. 902, 98 S.Ct. 3119, 57 L.Ed.2d 1145, granted certiorari and vacated and remanded. On remand, the Court of Customs and Patent Appeals, Rich, J., held that: (1) claims were within statutory subject matter and should not have been rejected on sole ground that claim was for “living organism”, and (2) decision was not an extension of Patent Act.
Board reversed.

40-47

57-100

Patentability means that an invention both falls within a subject matter category eligible for an exclusive right and satisfies the statutory requisites of novelty, nonobviousness, utilty, and adequate disclosure.

An invention qualifies for patent protection only if it achieves a tangible, practical advance in the useful arts.

Traditionally, discoveries in three areas do not qualify – natural laws, phenomena of nature, abstract principals.

Utility patent – processes, machines, manufactures, and composition of matter

Gottschalk v. Benson
409 U.S. 63 (1972)
U.S. Supreme Court

Proceeding on application for patent on method for converting binary-coded-decimal numerals into pure binary numerals for use with general purpose digital computer of any type. The Board of Appeals of the United States Patent Office, serial No. 315,050, affirmed rejection of claims and applicant appealed. The United States Court of Customs and Patent Appeals, 441 F.2d 682, reversed and Acting Commissioner of Patents obtained certiorari. The Supreme Court, Mr. Justice Douglas, held that computer program, a mathematical formula without substantial practical application except in connection with digital computer, was not a patentable process.
Reversed.

A mathematical formula, having no substantial practical application except in connection with a digital computer, cannot be patented.

Diamon v. Diehr
450 U.S. 175 (1981)
US Supreme Court

Respondents filed a patent application claiming invention for a process for molding raw, uncured synthetic rubber into cured precision products. While it was possible, by using well-known time, temperature and cure relationships, to calculate by means of an established mathematical equation when to open the molding press and

ring opinion states – bar should be low for determining whether to patent. Need to focus on whether it is new or non-obvious.

Freeman-Walter-Abele test for statutory subject matter (FWA test – Pg. 81) – First, determine whether the algorithm is recited in the claim directly or indirectly. If it is recited directly, the next question is whether the claim is no more than the algorithm itself. If it is, it it unpatentable. However, if the algorithm is applied in a manner to the physical elements of a process or the steps in a process, the claim is patentable. (rejected in State Street Bank)

State Street Bank & Trust Cp. V. Signature Financial Group, Inc.
U.S. Court of Appeals, Federal Circuit, 1998. 149 F.3d. 1368

Bank brought action against assignee of patent for computerized accounting system used to manage mutual fund investment structure, seeking declaratory judgment that patent was invalid and unenforceable. The United States District Court for the District of Massachusetts, Patti B. Saris, J., 927 F.Supp. 502, granted summary judgment for bank, and assignee appealed. The Court of Appeals, Rich, Circuit Judge, held that: (1) patent was directed to machine, not process; (2) invention was not unpatentable under mathematical algorithm exception to patentability; and (3) there is no “business method” exception to patentability.
Reversed and remanded.

Judge Rich was one of the original drafters of the 1952 Patent Act (this is the last case he wrote).

In order for an algorithm to be patentable, it must be applied in a useful way.

35 U.S.C. §101 Inventions patentable

Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title.

35 U.S.C. §102 Conditions for patentability; novelty and loss of right to patent

A person shall be entitled to a patent unless–

(a) the invention was known or used by others in this country, or patented or described in a printed publication in this or a foreign country, before the invention thereof by the applicant for patent, or

(b) the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States, or

(c) he has abandoned the invention, or

(d) the invention was first patented or caused to be patented, or was the subject of an inventor’s certificate, by the applicant or his legal representatives or assigns in a foreign country prior to the date of the application for patent in this country on an application for patent or inventor’s certificate filed more than twelve months before the filing of the application in the United States, or