LETTER FROM MICHAEL K. KIRK, EXECUTIVE DIRECTOR, AMERICAN INTELLECTUAL PROPERTY LAW ASSOCIATION (AIPLA), IN RESPONSE TO QUESTIONS TO GARY GRISWOLD, PRESIDENT AND CHIEF INTELLECTUAL PROPERTY COUNSEL, 3M INNOVATIVE PROPERTIES COMPANY, SUBMITTED BY THE HONORABLE ZOE LOFGREN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA Dear Representative Lofgren: I am writing to you on behalf of the American Intellectual Property Law Association (AIPLA) to communicate our answers to the questions presented in your letter of June 8, 2005 to Gary Griswold in connection with the June 9 hearing on H.R. 2795, the "Patent Act of 2005." We appreciate the opportunity to offer our answers. Question 1 Non-Obviousness Standard - These proposals seek to improve the quality of patents by 1). Eliminate the "suggestion to combine" test by tying it to the new filing date "Subject matter shall be found obvious even though the prior art does not contain Response: " This proposal would eliminate the requirement for any explicit or implicit suggestion or motivation to combine references to find an invention obvious. The requirement that a motivation or suggestion to combine non-anticipatory pieces of prior art before rejecting a patent application as obvious was imposed by the Court of Appeals for the Federal Circuit to avoid the use of hindsight in determining the obviousness of an invention. Hindsight is an insidious process that tends to make everything appear obvious once it has been disclosed and fully taught by the inventor. Denying patents to genuine inventors based on looking backwards at what they invented is the antithesis of the patent process and the constitutional requirement that we secure to inventors the exclusive right to their discoveries. The requirement for a suggestion to combine was an effort by the CAFC to make the question of what is obvious to a person of ordinary skill in the art answerable in a fairly objective and repeatedly consistent manner. Prior to the imposition of the suggestion to combine requirement, obviousness rejections and corresponding questions of validity during litigation were plagued by the application of hindsight. Indeed, many clever inventions seem to be obvious once revealed by their inventor. We have all thought from time-to-time that "I could have done that" upon learning of some clever new idea or product that seems blindingly obvious once presented to us. A simple analogy can be made to the challenge of assembling a 1,000-piece jigsaw puzzle, which is much easier to do with the picture of the assembled puzzle on the box than without. Assembly of the puzzle with the picture is completing the work with the benefit of hindsight. It is only natural to filter inventive subject matter through our own base of experience and knowledge after being triggered by the patentee's revelation and, wrongly, color it obvious-hence the Federal Circuit's application of the suggestion to combine test to help interpret the language of the patent statute. Determining what would have been obvious to a person having ordinary skill in the art requires subjective analyses that, in the past, led to inconsistent conclusions. The text proposed to be added to section 103 would increase rather than reduce the subjective elements that we now find at play in the patent system. It is contrary to one of the specific goals of The Patent Reform Act of 2005 to reduce, where possible, the subjective elements of patent practice and the concomitant costs and inefficiencies that attach to such subjective elements. The proposed standard would permit examiners to combine even disparate prior art references that not only lack any implicit suggestion to combine, but in fact may be quite distant and unrelated. It could result in a significant and unwarranted reduction in what could be patented. While many might agree that the current application of the suggestion to combine test is imperfect and might cause some examiners to be overly cautious in rejecting patents as obvious, the specific proposal is unhelpfully circular. It would state, in essence, that “in determining whether the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious to a person of ordinary skill in the art, the subject matter shall be found obvious if a person of ordinary skill in the art would have found the subject matter to be obvious." Finally, we can not understand the purpose of changing the last sentence to state that patentability shall not be negatived by the manner in which the invention was "subsequently used or commercialized” rather than “made." We are aware of no problem that such a formulation will correct. 2). Redefine the section 103 test from "non-obvious” to “inventive step. "35 U.S.C. (a) A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102 of this title unless an inventive step was required to achieve the difference between the subject matter sought to be patented and the prior art. An inventive step shall be defined as an advance that could not have been accomplished by a person of ordinary skill in the art without the undertaking of significant efforts. The burden of showing such efforts shall be on the person or entity seeking the patent.” Response: The second proposal is to redefine the section 103 test to focus on "inventive step" rather than on a determination of what is "non-obvious". The first sentence of this proposal adds nothing and would likely lead to confusion. "Inventive step" is the European equivalent of non-obviousness. Article 56 of the European Patent Convention defines "inventive step" in terms of obviousness: An invention shall be considered as involving an inventive step if, having regard to the state of the art, it is not obvious to a person skilled in the art... Thus, this change would, as would the first proposal, result in circular reasoning: we will no longer speak of non-obviousness; we will speak of inventive step which is defined as something that is not obvious to a person skilled in the art. However, the remainder of the proposal is more troublesome because it would stand U.S. patent law on its head and have far reaching consequences, many of which are presumably unintended by the proponents of the new language. Currently, an inventor is entitled to receive a patent unless the invention either lacks novelty or is found to be obvious in view of the prior art. The proposal would remove the burden from the PTO examiner of demonstrating prima facie obviousness, and instead require that the patentee somehow demonstrate that his invention "could not be accomplished by a person of ordinary skill in the art without the undertaking of significant efforts." In other words, the proposal would shift the focus from a determination of what is obvious to a "sweat of the brow" standard by requiring that "significant efforts" to make the invention be demonstrated by the applicant. We note that such a standard was struck down by the U.S. Supreme Court in the copyright context (as not satisfying the much less rigorous originality standard) in Feist Publications v Rural Telephone Service Co., 499 U. S. 340 (1991). discovered or recognized. It would change a determination of what is obvious to a person of ordinary skill in the art to a question of how hard a person of ordinary skill had to work to make the invention. Contrary to the last sentence of existing section 103 ("Patentability shall not be negatived by the manner in which the invention was made."), this approach would penalize an inventor who invented something with a 'flash of genius.' The individual who suddenly conceived a brilliant, radical solution to a long standing problem as he drove to work would find his invention to be unpatentable, while another individual who reached the same solution after ten years in the laboratory could obtain a patent. This would be an absurd result. Question 2 Standard Setting Organizations - These proposals are aimed at protecting companies that participate in standard setting organizations from patentees who fail to disclose their patents during the standard setting process. Response: AIPLA is aware of allegations that participants in standard setting organizations have abused the process by failing to disclose relevant patents or patent applications. Although the harmful effect of such conduct is clear, we believe that the way to curb this kind of abuse is not to weaken patent protection, but to address the anti-competitive behavior directly. The appropriate vehicle for corrective action is state and federal laws on anti-competition and state law on contracts. A standard-setting body can, and typically does, condition participation in the standard-setting process on disclosure of relevant patents. Thus, the standards contract or the rules of the standards-setting body can be written to provide protection from any undisclosed patents. See Rambus Inc. v. Infineon Technologies AG, 318 F.3d 1081 (Fed. Cir. 2003) for a discussion of the possible effects of the rules of a standards-setting body on the enforcement of undisclosed patents. 1). Introduce a "safe harbor" exception that protects the interoperability of standards-based products. The safe harbor could state that any act necessary to achieve interoperability between two independent products cannot trigger liability for willful infringement. This would help bring patent law in line with some of the protections afforded interoperability in the copyright and DMCA contexts. Response: This proposal has virtually nothing to do with the stated purpose of protecting the participants of a standard setting organization from fraudulent behavior by other participants. Instead this proposal would preclude a finding of willful patent infringement of patented technology when used to allow interoperability of standardsbased products, irrespective of whether the patented technology was owned by a participant in the standards-setting process. The analogy to copyright and the DMCA is inapt. The copyright fair use doctrine is applied in a fact intensive way to guard against erosion of the proprietary right. The interoperability defense of the DMCA at Section 1201(f) of Title 17 is a narrowly crafted affirmative defense to spell out limited circumstances in which technological access control measures may be circumvented. The statute is for owners of a lawful copy of a computer program who need access to software "for the sole purpose of identifying and analyzing" the program for interoperability, i.e., for engaging in reverse engineering. It has a narrow purpose that bears no relation to the liability risks created by those who abuse their participation in standard setting organizations. Other DMCA "safe harbor" provisions are similarly narrowly tailored and seck to limit Internet Service Provider's (ISP's) vicarious copyright infringement liability where they are performing the basic functions related to Internet activities, such as transmission, routing and caching. They do not permit an individual to use the technology of another without authorization. The proposed exemption would cover "any act necessary to achieve interoperability between two products," an incredibly broad and ill-defined standard. 2). Prohibit treble damages unless notice of potential infringement has been received before a standard has been officially adopted. Response: This notice proposal would bar treble damages for even deliberate and willful infringement unless the patent owner had the clairvoyance to know what technology will be adopted by a standard setting organization and what parties will practice that technology and require a notice of infringement. This proposal again has nothing to do with protecting the participants in a standard setting process. It is not limited to only those participating in such a proceeding. It would have the effect of lessening the potential damages available to the owner of a patent the use of which was mandated by a standard setting organization. 3). Define a reasonable royalty in standards-related lawsuits as the ex ante royalty price. Response: Initially, it must be noted that the phrase "standards-related lawsuits" is fatally vague. Many definitions of this term would in no way support the stated purpose of protecting the participants in a standard setting organization. Further, defining an ex ante royalty would appear to force a one-size-fits-all royalty determination that could never take into account the value of the different patents that might be subject to such a rule. |