en banc : CAFC Alert

The Alice in Wonderland En Banc Decision by the Federal Circuit in CLS Bank v. Alice

John Kong | May 13, 2013

CLS Bank v. Alice Corporation (en banc)

May 10, 2013

After the Federal Circuit issued its en banc decision on May 10, 2013 in CLS Bank v. Alice Corp, the patent owner Alice Corp must be feeling like Alice in Alice in Wonderland, bewildered and frightened by the fantastical situation in which they find themselves:

(1) “bewildered” because an equally divided Federal Circuit affirmed the district court’s holding that Alice’s claimed system to tangible machine components including a first party device, a data storage unit, a second party device, a computer, and a communications controller, programmed with specialized functions consistent with detailed algorithms disclosed in the patent, constitutes a patent ineligible “abstract idea;”

(2) “frightened” because, as Judge Moore puts it, “this case is the death of hundreds of thousands of patents, including all business method, financial system, and software patents as well as many computer implemented and telecommunications patents” (Moore Op. at 2); and

(3) “fantastical” because, as Judge Newman puts it, the en banc court was tasked to provide objective standards for 35 USC §101 patent-eligibility, but instead has “propounded at least three incompatible standards, devoid of consensus, serving to add to the unreliability and cost of the [patent] system…[such that] the only assurance is that any successful innovation is likely to be challenged in opportunistic litigation, whose result will depend on the random selection of the panel” (Newman Op. at 1-2).


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Liability for Induced Infringement of a Method Claim No Longer Requires Proof of Direct Infringement

Cindy Chen | September 14, 2012

Akamai Technologies, Inc. and MIT v. Limelight Networks, Inc.

McKesson Technologies, Inc. v. Epic Systems Corp.

August 31, 2012

Panel: Rader, Newman, Lourie, Bryson, O’Malley, Linn, Dyk, Prost, Reyna and Wallach (en banc)

Per curiam opinion, joined by Rader, Lourie, Bryson, Moore, Reyna, and Wallach.  Dissent by Linn, joined by Dyk, Prost, and O’Malley.  Dissent by Newman.

Summary

In a 6-5 en banc decision, the Federal Circuit rejected precedents and relaxed the standard of proof for finding induced infringement under 37 USC §271(b).  Traditionally, induced infringement requires a two-pronged showing of (1) knowing inducement to infringe and (2) actual direct infringement of the patent.  In fact, direct infringement had long been held as the sine qua non of indirect infringement liability. The court’s new standard, however, eliminates the direct infringement requirement. Now, in cases involving method claims, inducement liability follows if the accused infringer (1) had knowledge of the patent, (2) induced others’ performance of the steps of the method claims, and (3) the steps were actually performed. Liability also follows if the accused infringer performed some of the steps of the claims and then knowingly induced another to perform the remaining steps.


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The threshold to acquiring intervening rights by reexamination requires new or amended claim language

Bernadette McGann | March 21, 2012

Marine Polymer Technologies, Inc. v Hemcon, Inc. (en banc)

March 15, 2012

Panel: Rader, Newman, Lourie, Bryson, Gajarsa, Linn, Dyk, Prost, Reyna and Wallach (en banc)

Opinion for the court by Lourie. Rader, Newman, Bryson and Prost join in full and Linn joins in part II (Intervening Rights)

Opinion for the dissent by Dyk. Gajarsa, Reyna, and Wallach join in full and Linn joins in parts I-II (Claim construction, dismissing HemCon motion for JMOL and/or new trial)

Summary:

Based on statutory interpretation of 35 U.S.C. §307(b), the Majority held that the threshold requirement for acquiring intervening rights is that there must be amended or new claims that did not exist in the original patent but have been found to be patentable during reexamination.  The CAFC held that amended means to make formal changes to the actual language of a claim.  A claim is not amended merely because the scope of the claim has been altered by arguments presented during reexamination.


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