7122084695_11f7a0566e_zKimble v. Marvel Enterprises involved a device that allowed its user to shoot “webs” a la Spider-Man. Kimble invented and obtained a patent for this web-shooting device and tried to sell or license that patent to Marvel Entertainment, the creator/owner of Spider-Man. Marvel declined, but ultimately came to market with its own “Web Blaster,” which similarly allowed its user to shoot webs a la Spider-Man. Kimble brought an action for patent infringement which was settled by Marvel purchasing Kimble’s patent for a lump sum plus a royalty on future sales of the “Web Blaster.” The agreement was open ended as there was no termination to the royalty payment.

Are Royalties Due After Patent Expires?

Kimble’s patent expired in 2010. Thereafter, Marvel brought a declaratory judgment action seeking a determination that it was no longer required to pay royalties on an expired patent. Marvel’s position was based on Brulotte v. Thys Co., 379 U.S. 29 (1964), where the Supreme Court held that a licensor is not entitled to patent royalties from a licensee after expiration of the licensed patent. The district court agreed with Marvel, finding no distinction between the fact that Brulotte involved a patent license agreement where the party receiving royalties retained ownership of the patent at issue and the Kimble/Marvel relationship where the party receiving royalties no longer owned the patent at issue. Thus, Brulotte controlled and no further royalties were required after expiration of the Kimble patent. The Ninth Circuit Court of Appeals affirmed reluctantly, agreeing that Brulotte was controlling precedent but felt that the decision was “counterintuitive.”

Decision

Continue Reading Judicial Update: Supreme Court Rules on Spider-Man Web Blaster Patent Royalties

Gavel iconContinuing with our series reporting on the recent U.S. Supreme Court decisions, today we will decipher the impact of the second patent case, Commil v. Cisco, and the claim of “induced infringement.”

Belief in Patent Invalidity is not a Defense

The Commil v. Cisco decision involved the issue of what knowledge is required by a defendant in a claim of induced patent infringement. Briefly, a party can be liable for directly infringing the patent of another, where it utilizes patented matter of another without authorization, or by inducing a third party to infringe a patent of another. Induced infringement often involves situations where a party may simply provide the means to third-parties and their use of those means result in infringement of a patent.

Facts of the Case

Continue Reading Judicial Update: Commil v. Cisco

FlickrLess than five years after passing the America Invents Act (“AIA”), both the House and Senate have introduced bills to further reform the Patent Act, specifically in response to addressing the issue of abusive litigation by “patent trolls.” In the House, “The Innovation Act,” H.R. 9, was introduced in February, 2015. This bipartisan bill largely parallels legislation the House passed during the last Congress that ultimately died in the Senate. The House will likely pass this bill in the very near future, sending it again to the Senate. In the Senate, in May, 2015, the “Protecting American Talent and Entrepreneurship Act,” or PATENT Act, S. 1137, was introduced. This bill also has bipartisan support and was recently approved by the Senate Judiciary Committee.

Overall, both bills are quite similar as they both have the same general intent: to limit baseless, abusive litigation by trolls. However, there are some significant substantive differences between the bills in how this goal is reached. These differences focus primarily on the areas of fee shifting and recovery; pre-litigation demand letters by patent owners; claim construction during AIA review proceedings; and venue.

Loser Pays

Continue Reading More Patent Reform on the Horizon in Washington

Patent managementUsually, the first thing an alleged patent infringer will receive is some kind of demand or cease and desist letter from a third-party ostensibly describing that party’s claims. The practical reality is that most patent infringement demand letters, especially by those considered “trolls,” are often vague, misleading and incomplete. While short on substance and detailed allegations of infringement, many of these letters will, however, contain claims for lump-sum payments or warn a party can avoid litigation by entering a license agreement. On July 1, 2015, the Patent Troll Prevention Act, F.S. 501.991, went into effect. The law is intended to address patent infringement demand letters and bad-faith patent litigation.

Demand Letters

Continue Reading Florida Legislature Goes After Patent Trolls

Teva_logoWhile the 2014-2015 U.S. Supreme Court term might be most remembered for the groundbreaking Obergefell v. Hodges decision, it can also be remembered for taking on six intellectual property cases, including two trademark cases. While the Court’s IP docket has grown in recent years, decisions touching on the subject are still fairly rare. Thus, when the Court takes an IP case, it is usually one that will carry significant impact. We will offer a brief summary of all the Court’s IP decisions, beginning with one of the patent cases, Teva Pharmaceuticals v. Sandoz.

New Standard of Review in Claim Construction

Teva Pharmaceuticals v. Sandoz involved a suit over alleged infringement of a patent relating to the manufacture of a multiple sclerosis drug and, in particular, the definition of the term “molecular weight” as it appeared in the patent claims. The language used in patent claims dictate the baseline scope of the patent holder’s rights and therefore a defendant’s putative infringement. Per the Supreme Court’s Markman v. Westview Instruments decision, patent claim construction is a legal issue to be determined by the Judge. As a legal issue, therefore, all district court determinations regarding claim construction were subject to de novo review in the Appellate Court – until Teva.
Continue Reading Judicial Update: Intellectual Property Decisions from the Supreme Court’s 2014-2015 Term