Saturday, July 31, 2004

Criminal actions in patent litigation

from a press release of the Dept. of Justice, July 27, 2004:

The United States Attorney's Office for the Northern
District of California announced that a former
chairman and CEO of a high-tech company [Aptix] was indicted
today on charges of plotting the murder of a federal
judge in San Francisco and the intimidation of
witnesses connected to his case. In addition to the
23 counts facing the chairman and CEO, his brother was
also charged with conspiracy to obstruct justice and
perjury.

Amr Mohsen, 57 of Los Gatos, California and his
brother, Aly Mohsen, 51 of Springfield, Missouri, were
charged in a superseding indictment today by a federal
grand jury on 23 counts. Amr Moshen was charged with
soliciting to commit the murder of the federal judge
who was hearing his criminal case–the Hon. William H.
Alsup–in violation of Title 18 U.S.C. § 373 ,
solicitation of arson in violation of Title 18 U.S.C.
§ 373, and attempted witness tampering in violation of
Title 18 U.S.C. § 1512.

The federal case involving Mr. Mohsen began when he
was a witness in a civil patent matter, Aptix
Corporation et al. v. QuickTurn Design Systems, Inc.
Mr. Mohsen was the founder, chairman and CEO of Aptix,
the plaintiff. That case was being heard by Judge
Alsup in San Francisco. During the civil trial, Mr.
Mohsen testified about an Engineering Notebook that
would have given him exclusive rights to a patent
because he claimed to have invented the technology in
question involving "field programmable" circuit
boards. According to the indictment, Amr Mohsen, the
founder, chairman and chief executive officer of Aptix
Corporation, along with his brother Aly Mohsen, were
originally indicted for perjury and obstruction of
justice for testimony given in the civil trial. That
criminal case was also pending before Judge Alsup and
was about to go to trial when Amr Moshen was arrested
for contempt of court and violating the conditions of
his release.

On April 20, 2004, a superseding indictment was
returned which included an additional count against
Amr Mohsen for contempt of court in violation of Title
18 U.S.C. § 401(3). This count was filed after Amr
Mohsen was arrested three days before he was supposed
to go to trial. At the time of Amr Mohsen's arrest,
he was in possession of a newly issued Egyptian
passport in violation of his bail agreement and
$20,000 cash. Mr. Mohsen had been overheard making
flight reservations for the Cayman Islands.

After Amr Mohsen was arrested for contempt, he was
ordered detained and placed in custody in an Alameda
County detention facility (Santa Rita jail) pending
trial. According to a search warrant affidavit
unsealed today and the superseding indictment, Mr.
Mohsen solicited new criminal activity while housed in
the Santa Rita jail. Specifically, it is alleged that
Amr Mohsen solicited the murder of the federal judge,
Hon. William H. Alsup, who had been presiding over his
criminal case; that Mr. Mohsen sought to intimidate a
trial witness by commissioning the arson of that trial
witness' car; and that Mr. Mohsen attempted to
intimidate other trial witnesses with threatening
phone calls warning them not to show up for trial or
they will "come up missing."

According to the search warrant affidavit, Mr. Mohsen
contracted with an informant, who, with the FBI's
assistance, listened to conversations with Mr. Mohsen.
Mr. Mohsen solicited the informant's assistance in
committing a series of criminal acts while he was in
jail. According to the affidavit, Mr. Mohsen's
criminal activity from Santa Rita jail culminated with
Mr. Mohsen's solicitation of the murder of Judge Alsup
during the weekend of June 12-13, 2004. The affidavit
alleges that Mr. Mohsen approached an informant and
stated that he desired to make the Federal Judge in
his criminal case "disappear" so he will be "never
found." According to the affidavit, Mr. Mohsen
confirmed that he meant he wanted a "funeral" for the
judge. Mr. Mohsen allegedly told the informant that
once the Judge was gone, "everything will go my way."

The search warrant affidavit alleges that Mr. Mohsen
and the informant discussed the possible methods by
which the murder of Judge Alsup could be accomplished,
including a gas leak, to which Mohsen replied "which
is least traceable?" Mr. Mohsen negotiated with the
informant over the price for murdering Judge Alsup.
According to the affidavit, Mr. Mohsen was told that
the murder of a Federal Judge was a big deal and would
cost $25,000. After hearing that price, Mohsen
allegedly stated: "That's very high...I heard it's
more like ten [$10,000]."

In addition to soliciting the murder of the judge set
to hear his trial, Mr. Mohsen identified five trial
witnesses by name and gave their home phone numbers to
the informant. He asked the informant to burn down
the home of one witness and to stage a break-in to the
car of another while leaving a threatening note. Mr.
Mohsen later changed his mind about burning the
witness' home and instead commissioned the arson of
that witness' car in order to frighten the witness and
dissuade the witness from testifying at the trial.

The second defendant, Aly Mohsen, is a medical doctor
who owns shares of Aptix. He is charged with
obstruction of justice, conspiracy to obstruct justice
and perjury based on his participation in the creation
of the fabricated notebook and false statements that
he made about them as a witness in trial.

The maximum statutory penalty for each count in
violation of Title 18 U.S.C. § 373, one half of the
maximum penalty for the crime solicited and a fine of
$250,000. The maximum statutory penalty for a
violation of Title 18 U.S.C. § 1512 is ten years
imprisonment and a fine of $250,000. An indictment
simply contains allegations against an individual and,
as with all defendants, Amr and Aly Mohsen must be
presumed innocent unless and until convicted.

Amr and Aly Mohsen's next scheduled appearance is at
10:30 a.m. on August 4, 2004, before District Judge
Phyllis Hamilton, who was assigned this case following
Judge Alsup's recusal.

The prosecution is the result of a two year
investigation by agents of the FBI. Robin Harris is
the Assistant U.S. Attorney who is prosecuting the
case.

A copy of this press release may be found on the U.S.
Attorney's Office's website at www.usdoj.gov/usao/can.
Related court documents and information may be found
on the District Court website at www.cand.uscourts.gov
or on http://pacer.cand.uscourts/gov.

All press inquiries to the U.S. Attorney's Office
should be directed to Assistant U.S. Attorney Matthew
J. Jacobs at (415)436-7181 or Criminal Chief Ross
Nadel at (415)436-6778.

UPDATE. Oct. 10, 2004.

In a recycling of old news, we have from the American Lawyer:

Faked Evidence Turns Patent Case Ugly -- Really Ugly
The American Lawyer
10-11-2004

When Amr Mohsen's company brought a patent infringement suit six years ago, he was backed by an A-team of lawyers. The case progressed into a disturbing dispute with mysteriously disappearing documents, a dramatic last-minute withdrawal by counsel, and Mohsen allegedly soliciting the murder of federal Judge William Alsup in California. Within this bizarre case is also a tale of hard-nosed, combative advocacy blinding lawyers to the consequences of their client's actions.


Friday, July 30, 2004

Britain proposes fund for patentees to litigate

Under a new proposal, patent holders will be given help to fight rivals that infringe their patents under proposals for a government-backed insurance scheme to provide them with funds for litigation.


The UK Patent Office is concerned that the high costs of legal action often prevent smaller patent holders from defending their intellectual property against competitors that are better financed.

The idea, supported by Lord Sainsbury, science minister, arises at a time of mounting concern in the government over Britain's record on innovation and IP protection.

In a study released July 28, 2004 aimed at improving IP rights enforcement, the Patent Office called for the creation of a mutual insurance association to provide a fighting fund of £50,000, and possibly much more, for each member, to allow companies to take patent infringers to court.

The report acknowledged that the scheme, likely to be similar to the Medical Defence Union, would almost certainly need government funding until enough companies joined to make it self-sustaining.

Microsoft patent filings to increase by 50%

As noted in the New York Times [below], Microsoft announced on July 29 that its patent filings will increase by 50% in the next fiscal year. Note also, however, the allusion of Gates to patent impact statistics (as those of CHI research), which are generally statistically meaningless but good to throw out to analysts and shareholders when they look good.

As discussed in a previous post, some have taken this increased patent activity as part of a strategy to attack open source. While it may have an impact in the open source area, it may simply be that Microsoft needs some new products to sell, ones with better growth opportunities than the old ones.

from the New York Times:

Microsoft said on July 29, 2004 that it planned to increase its storehouse of intellectual property by filing 50 percent more patent applications over the next year than in the previous 12 months.

Microsoft, the world's largest software company, increasingly regards the legal protection of its programming ideas as essential to safeguarding its growth opportunities.


Speaking at the company's yearly meeting with financial analysts, Bill Gates, the company's chairman, called patents a "very important part" of what he termed the "cycle of innovation" that has been responsible for Microsoft's past prosperity and continued corporate health.

The planned surge in Microsoft patent activity would come at a time when it faces increasing competition from open source software like the Linux operating system, which is distributed free.

Open source software is a reaction against proprietary software. Advocates of open source computing regard the excessive use of software copyrights and patents by corporations like Microsoft as a restriction on the efficient exchange of ideas among programmers.

Microsoft's stepped-up patent program, analysts say, will be watched closely in the industry to see if the company uses it mainly as a defensive tactic or as an offensive weapon to try to slow the spread of open source products.

The company did not spell out its intentions. But Kevin R. Johnson, group vice president for worldwide sales, said that its software licenses indemnify customers against legal patent and copyright challenges to Microsoft products, whereas the legal protections offered by companies that support Linux are far less substantial. And he said that "intellectual property risk" is now one of the issues that corporate customers routinely raise when assessing software.

The software business, Mr. Gates said, runs on innovation instead of capital. He portrayed the announcement last week that the company would hand $32 billion to its shareholders in a special dividend this year as proof of the success of Microsoft's proprietary formula - instead of a sign that the company had matured and run out of growth opportunities, as some analysts suggested.

"We think there's more profit where that came from," Mr. Gates said. "That's why the investment level is up and that's why the focus on intellectual property is very strong."

Microsoft, Mr. Gates said, intends to file more than 3,000 patents in its 2005 fiscal year, which began this month, up from about 2,000 patent filings in fiscal 2004. It typically takes three years or more before a filed patent is approved. Today, Microsoft trails well behind I.B.M. and several other hardware makers in the size of its patent portfolio.

But patent counts alone, Mr. Gates noted, are an imperfect measure of a company's innovative activity. Equally important, he said, is the impact of the patents filed. Mr. Gates cited research showing Microsoft patents are cited as "prior art," or examples of existing knowledge, in other patent filings somewhat more often than the patents of other technology companies, including Oracle, Sun Microsystems, Apple and I.B.M.

The theme of the daylong conference was that Microsoft views a host of growth opportunities ahead, and that innovation will fuel that growth.

"People don't want to come here to work for some stodgy, old, middle-aged company," Microsoft's chief executive, Steven A. Ballmer, said.

The company is coming off a strong year, as its revenues rose 14 percent, to $36.8 billion, in the year that ended last month. Microsoft benefited more than others from the modest recovery in the technology sector and a rebound in personal computer sales, particularly as corporations finally replaced their aging machines.

Despite its long-term optimism, Microsoft expects the current year to be one of lower growth of 5 percent or so. The company traditionally makes conservative projections, then routinely surpasses those modest figures. Financial analysts expect that Microsoft's revenues may well grow by 10 percent.

The challenge for Microsoft is to find ways to stimulate growth before the arrival of an ambitious new generation of its Windows operating system, code-named Longhorn, which is not expected to ship before 2006.

Cisco settles with Huawei

Cisco Systems Inc. agreed July 29, 2004 to settle its patent lawsuit that charged Chinese rival Huawei Technologies copied Cisco code and documentation for its routers and switches without permission. The lawsuit, filed in January 2003 in U.S. District Court in Marshall, Texas, asserted Huawei and two U.S.-based subsidiaries not only copied protected parts of Cisco technology but also infringed on at least five patents.

Thursday, July 29, 2004

J&J loses Hatch-Waxman case to Eon on Sporanox

A district court ruled that a generic version of Johnson & Johnson nail fungus drug Sporanox proposed by Eon does not infringe a company patent, the Janssen Pharmaceutica unit of J&J reported on July 29, 2004.

The decision affects only US sales of the drug, which, in 2004Q2, comprised only $32 million of worldwide sales of $170 million.




Wednesday, July 28, 2004

Blogging of litigation, a page from Pravda?

Blogging allows rapid accessibility to information, but the accuracy still needs to be confirmed.

derived from The National Law Journal:

Running the Oracle trial Web log is Gary Reback of Palo Alto, Calif.'s Carr & Ferrell, who represents PeopleSoft Inc., the object of Oracle's hostile takeover that the Department of Justice (DOJ) is trying to block in the antitrust proceeding. At his client's request, Reback is "blogging" the proceeding, sitting in the trial all day, taking notes, and filing an account on PeopleSoft's corporate Web site.

"Perhaps I can give some balance to Oracle's artful spin," Reback writes at the start of the blog, titled "View from the Court."


The flip side is bias. "It's like getting your news from Pravda," Oracle lawyer Dan Wall said in a phone interview last week, after the bench trial ended. A decision from U.S. District Judge Vaughn Walker is expected in the next two months.

"One of the powerful things about Web logs and the quick and easy publishing they enable is the ability to write precisely what it is you think needs saying," said Reed Smith's Howell. "This is attractive to any litigant or lawyer who has lamented being misquoted, taken out of context, or cut by the mainstream media."

**

Although the information is available, the effectiveness of a blog depends on both the extent of dissemination and the amount of credibility. If the information circulates only to a small group of insiders, who cares? Even with greater circulation, if there is a perception of one-sidedness, the impact will be compromised. Nevertheless, as Leon Trotsky recognized in the History of the Russian Revolution, events sometimes can best be recounted by insiders to the action.

Liability for internet content providers for false statements?

A California appeals court ruled July 22, 2004 that EBay Inc.'s savvy user agreement relieved the company of liability for the defamatory postings one user of its auction site made against another. However, the court said that a provision of the California Decency Act of 1996, which provision is routinely invoked by content providers as a defense, does not immunize eBay against liability for disseminating information it knew, or had reason to believe, was false.

Tuesday, July 27, 2004

Bio-Rad sues law firm Townsend and Townsend

On Thursday, July 22, 2004, Bio-Rad of Hercules, Calif. filed a complaint in San Francisco Superior Court accusing Townsend and Townsend of legal malpractice, breach of fiduciary duty and breach of contract for services spanning one decade and two pieces of patent litigation. Bio-Rad wants about $35.5 million in damages, including $5.5 million for Townsend's attorney fees. In response, Guy Calladine, a defense attorney for the firm and its partners, stated the dispute is "ancient," and as much about attorney fees as anything else.

The suit illustrates the difficulties arising for an attorney who serve multiple roles for a client. Townsend and Townsend partner Albert Hillman (now retired) had distinct functions as to Bio-Rad Laboratories Inc.: working as one of its IP lawyers, sitting on its board of directors, and testifying in its patent litigation. Needless to say when patent litigation ensued, the opposing side was able to attack his credibility because of this. The opposing side won.

Now Bio-Rad is raising Hillman's three roles in a legal malpractice suit against Townsend and two of its partners, Roger Cook and Theodore Brown III.


In defense, Townsend argues that Bio-Rad knew of the arrangement. "Bio-Rad was fully informed as to everything," said Calladine, of Carlson, Calladine & Peterson, which defends Townsend. He also noted that although the dispute arose about nine years ago, Townsend "has continued to do substantial work for Bio-Rad."

The malpractice suit involves two patent litigations.

An issue in the first litigation is the credibility of the multi-function partner. Suing Pharmacia AB for infringement, Bio-Rad says they were "subject to significant impeachment due to Hillman's position on the Bio-Rad board of directors and the fact that Bio-Rad had paid and continued to pay Townsend significant sums for representation." Another issue is bad advice. Bio-Rad noted that Pharmacia tried to resolve the dispute, but Townsend discouraged settlement by "incorrectly" advising that Bio-Rad would prevail. The case went to trial in 1992, and Bio-Rad lost on both infringement and invalidity grounds.

Referencing California Rule of Professional Conduct 3-310, Bio-Rad now complains that Townsend had an interest in the suit and should have obtained informed written consent from its client but didn't. The firm was litigating the validity of a patent it had filed, the complaint says, and Townsend should have seen "the foreseeable consequences of Hillman testifying."


In the second case, Bio-Rad similarly alleges that the firm gave bad advice when Pharmacia sued it in federal court in New Jersey in 1991, alleging Bio-Rad had willfully infringed on a patent. After a jury found for Pharmacia, Bio-Rad resolved the case for $5.5 million before reaching the trial's damages phase, the complaint says.


[post based on story in The Recorder, July 27, 2004]

Thursday, July 22, 2004

AstraZeneca brings Hatch-Waxman action against Andrx over TOPROL

AstraZeneca Plc said on July 22, 2004 that it filed suit against generic drugmaker Andrx Corp. in a Hatch-Waxman dispute over metroprolol succinate (TOPROL-XL) in the U.S. District Court for the District of Delaware.

Wednesday, July 21, 2004

BTG goes against Microsoft, Apple for patent infringement in ND Ca

The British Technology Group [BTG], which was set up to commercialize inventions, yesterday sued computer giants Microsoft and Apple over six U.S. patents that the company says they have infringed.

The six patents in question are 5,694,546; 6,594,692; 6,125,388; 6,658,464; 6,611,862; and 6,557,054. US patents can be viewed at the US Patent and Trademark Office's Web site (www.uspto.gov).

BTG filed papers in federal court in northern California [ND Ca] on July 20, 2004, asserting, among other things, that both the companies have infringed a patent covering online software updates, owned by BTG subsidiary Teleshuttle.



Tuesday, July 20, 2004

Microsoft to launch patent war on open source?

From ZDNet on July 20, 2004:

Microsoft has been preparing for an all-out assault on open-source software via patent law, according to what is apparently an internal HP memo from 2002


What appears to be a leaked internal memo from HP shows that the company expected Microsoft to launch a full legal assault on free open-source software (FOSS) using patent law. The document, dated two years ago and revealed on the Newsforge FOSS news site yesterday, details concerns at the highest levels within HP that "basically Microsoft is going to use the legal system to shut down open-source software".


**
Microsoft has been filing numerous applications for a number of years, and thereby creating a large portfolio. They have hired IBMs IP guy and likely intend to follow the recent IBM model of licensing. Whether this is specifically directed to open source...

On July 20, 2004, CNET reported that HP was downplaying the significance of the two year old memo to the present time: The memo, first reported by open-source news site Newsforge, is authentic but "not relevant today" for both HP customers and open-source software users in general, said HP spokeswoman Elizabeth Phillips. "Since the memo is over two years old, we believe today's situation is different for the industry in general."
**
From Goodwins of ZDNet:
But this was two years ago, and the promised onslaught has yet to happen. Could this be just another bit of MS partner management, a bit of internal FUD designed to keep HP on the straight and narrow without the risks of having to actually do anything? Is Microsoft's patent arsenal there, as the company has said, purely for defensive purposes?

Let's look at what Microsoft has been doing in the intellectual property arena over the past couple of years. It has embarked on a record number of cross-licensing deals, including some with long-term combatants such as Sun, and started to open up its intellectual property portfolio to anyone who wants to sign up.

It has registered, bought or prepared thousands of patents. It has settled many long-running IP cases out of court, never to its advantage. It's said that academics can use its IP for free. Are these the signs of a company settling down to being a good corporate citizen and preparing to play by the rules, or a company preparing to use the court and patent system for a much bigger and more aggressive assault? If you don't habitually license your IP on fair terms, you have a hard time convincing the courts that you're suddenly in favor of the idea: ditto if you're in the habit of aggressively pushing claims of questionable merit.

Most significantly, though, Microsoft has hired Marshall Phelps.



Monday, July 19, 2004

Inverness Medical to obtain injunction against Acon Labs

 
In the following, note the text:
 
...higher than anticipated expenses for legal matters and research and development and shifts in revenue mix, it expects results for the quarter to fall short of previous expectations.
 
so even when one wins in a patent litigation, it is costly.
 
from Inverness:
 
WALTHAM, Mass., July 19 /PRNewswire-FirstCall/ -- Inverness Medical Innovations, Inc. (Amex: IMA - News), a leading manufacturer and marketer of rapid diagnostics products for the consumer and professional markets, announced today that the United States District Court for the District of Massachusetts has granted Inverness' motion for a preliminary injunction against Acon Laboratories, Inc. Acon sells various immunoassay products throughout the world, and is a supplier of private label consumer diagnostics products to major retailers and other distributors. The injunction, when it goes into effect, is expected to cover Acon's sandwich-type immunoassay tests, including strep, pregnancy and ovulation tests, in the United States. In a Memorandum and Order issued on July 16, 2004, the Court also granted Inverness' motion for summary judgment of infringement, finding that Acon has infringed Claims 7 and 19 of U.S. Patent No. 6,485,982 (the "'982 patent"). In addition, the Court denied Acon's motion for summary judgment of invalidity of Claims 7 and 19, and found that on the basis of the record before her, Inverness had shown that it was likely to succeed in its arguments against Acon's invalidity contentions. The two claims of the '982 patent at issue were also the subject of recent Markman hearings in the lawsuit between Inverness and Quidel Corporation, now pending in U.S. District Court in San Diego. Inverness asserts in that case that Quidel is also infringing the '982 patent.


The Court's order directs Inverness to file a proposed form of injunction order, and gives Acon ten business days to propose an amount of a bond for the injunction. The Court's order also notes that certain issues relating to Acon's challenge to the validity of the claims can be heard at trial. Under the scheduling order currently in place, a trial is scheduled for early November 2004.
In a related case also pending in the District of Massachusetts against Acon, Inverness has accused Acon of infringing certain other patents owned by an Inverness subsidiary, and has moved separately for summary judgment of infringement of one of those patents as well. The motion is pending. Inverness, in its claims in both cases, is seeking both damages and permanent injunctive relief against Acon.
The favorable court ruling is likely to have a positive effect on sales, as Inverness may be able to acquire new accounts for products that were previously supplied by Acon. However, Inverness also cautioned investors that, due to revenues of approximately $88 million in the second quarter of 2004, higher than anticipated expenses for legal matters and research and development and shifts in revenue mix, it expects results for the quarter to fall short of previous expectations. Inverness expects to further discuss the impact of the Court's ruling and provide revised guidance during its next earnings conference call scheduled for Wednesday, July 28, 2004.
Ron Zwanziger, CEO of Inverness Medical Innovations, stated, "We are extremely pleased with this decision, which confirms the strength of our patent position, and we believe that this development and other positive developments in the area of IP litigation will, despite the issues discussed above, contribute to continued positive momentum towards our long term goals in 2005 and thereafter."

Sign of the Times: baseball cap gas mask

On July 19, 2004, the New York Times highlighted U.S. Patent No. 6,752,146 to Boris Altshuler and James F. Reynolds, directed to a baseball cap/gas mask to protect the average American citizen against a biological or chemical attack.


The Altshuler-Reynolds mask is an embodiment of what is known as a "supplied-air respirator." The user breathes purified air that has been propelled by a small fan through a filter into the mask.
The air is to be purified by activated carbon, material which CR Clean Air typically uses on an industrial scale to scrub the air of coal-burning power stations.

The trick here is that activated carbon does not remain active indefinitely, and separately does not interact with all molecules.


The assignee, CR Clean Air Technologies of Westfield, New Jersey, is not planning to manufacture the mask, however, because it is not related to the company's core business of producing technology that reduces industrial air-pollution emissions.

Sunday, July 18, 2004

Story by AP on Acacia/EFF

from an AP article by May Wong, Civil liberties group fights to bust patents [published, for example, in the Houston Chronicle, July 17. The "civil liberties" group is EFF.]

-->

A challenger must find written evidence, called "prior art" in patent parlance, showing others developed the technology before the patent application was filed, a formidable task that consumes a cottage industry of patent researchers and lawyers. [For the PTO to initiate a re-examination, there must be written documents which raise a substantial new question of patentability. A prior art patent or publication meets this requirement; a prior use or sale does not.]

One-time startup Bounty-Quest set out in 2000 with such a mission. It wanted to debunk questionable patents by letting interested parties offer rewards of $10,000 or more for hard-to-find prior art. But there were few takers, and the business failed.

The Electronic Frontier Foundation is similarly relying on volunteers — but without offering rewards. That's a surefire recipe for limited success, said Bradley Wright, a patent lawyer with Banner & Witcoff Ltd. Even when prior art is presented, re-examinations are rare. The patent office held only 6,136 between the time the agency was authorized to do so in July 1981 and the end of March 2004, said Brigid Quinn, a patent office spokeswoman. [Re-examinations initiated by third parties cost the third party money, and offer less opportunity to invalidate a patent than does litigation. Until recently, once the third party presented its written documents, the third party's role in the re-examination was finished. The proceeding would devolve to an interaction between the PTO and the patent holder. Litigation allows the patent challenger to mount attacks based on prior use, prior sales, inequitable conduct, and testimony of witnesses, none of which are available in a re-examination. Thus, quoting statistics on re-examination overlooks the principal way in which patents are challenged. Further, in litigation, the court will construe claims in a Markman hearing. In the currently pending litigation involving the Acacia patents, a Markman hearing has been held.]

[It is also true that the Director of the PTO can order a re-examination. This happened with the so-called swing patent and with the Eolas patent.]

Saturday, July 17, 2004

Academic opinion on intellectual property

from an opinion piece by Ronald L. Phillips, Jim Chen, Ruth Okediji, and Dan Burk


in The Scientist, 18(14), July 19, 2004

What else can be done? Improved assessment of the impact of the expiration of key patents would help. A humanitarian use exemption for special situations would be useful, and public institutions should clarify their intellectual policy policies. A recently developed clause provides a model for public institutions to modify their intellectual property policy statements. Other possible measures include the raising of patentability standards, evaluating the apparent loss of universities' so-called research exemption from patent infringement liability [i.e., Madey v. Duke University], adapting licensing policies within the public sector, and revitalizing stewardship of intellectual property. In the long run, building scientific and institutional capacity in developing countries may be the most important means by which American universities can discharge their moral obligation to the world at large.

http://www.the-scientist.com/yr2004/jul/opinion_040719.html

Reference 2 is 2. R.N. Beachy, "IP policies and serving the public," Science, 299:473, 2003.



Friday, July 16, 2004

On the IBM/Clapp controversy

There was a furor last month when other contributors to a special November 2004 issue of Clinics in Occupational and Environmental Medicine withdrew their papers in protest over a refusal by Elsevier to publish therein a paper by Richard Clapp on occupational exposure of Silicon Valley semiconductor workers (of IBM) to various solvents.

In a recent issue of Science, IBM has presented its side of the story in the format of a "letter to the editor." In this letter, Scott R. Brooks responds to the Sciences's May 14, 2004 article about the topic, saying that Clapp's data are “incomplete and inadequate for reliable study,” and that Clinics is not a peer-reviewed journal. He adds that that Clinics' guest editor, Joe LaDou, of the University of California School of Medicine at San Francisco, was a plaintiffs' expert in litigation against IBM. The fact that Clapp's study was driven by litigation raises “serious questions about its objectivity,” he says.

The journal The Scientist talked to Joe LaDou. LaDou told The Scientist that he was asked to serve as a historical expert to present background information during the deposition for the California case because he was one of the few people in practice in Silicon Valley during the late 1960s, when many of the allegedly detrimental exposures occurred. However, he never testified in the actual trial.

“I have never been an expert witness in my entire career,” he said.

Further, the author of the May 14 article in Science, Dan Ferber, writes that he asked three epidemiologists with no relationship to the litigation to look at the study, and all said the results were preliminary but “scientifically valid and deserving of further study.”


See http://www.biomedcentral.com/news/20040716/05

Thursday, July 15, 2004

Dr. Reddy's challenges AstraZeneca's NEXIUM

AstraZeneca confirmed on July 15, 2004 that Indian drugmaker Dr. Reddy's Laboratories had made a Hatch-Waxman filing relating to NEXIUM in the United States (presumably the first step to manufacturing a generic challenger to the branded drug NEXIUM), but that it was confident of defending a patent challenge to its top-selling ulcer drug NEXIUM (esomeprazole) after the threat of a generic competitor knocked down the value of its shares.

The interrelationship of NEXIUM and PRILOSEC is one of enantiomer to racemate, so that this paragraph IV filing may be a challenge to patent validity, and, if so, may be quite significant to many pharmaceutical patents.

Wednesday, July 14, 2004

Philips sues Gillette over patents to electric toothbrushes

Royal Philips Electronics filed lawsuits in federal district court in Delaware and in the Landesgericht Dusseldorf in Germany against Gillette Co. for infringement of claims in patents directed to electric toothbrush technology.

Philips uses the technology in its Sonicare electric toothbrushes, which use microprocessors to direct bristle movement. The accused products of Gillette are electric toothbrushes sold under the Oral-B brand.

Philips received its patent for sonic technology in the United States in 1995 and another in Europe in 2000.

Tuesday, July 13, 2004

Is there a shortage of technical people in the U.S.?

Although some corporate executives, such as Craig Barrett, speak of a shortage of technical talent in the U.S., it is more likely that there is a surplus. From the Arizona Republic (July 11, 2004):

"Over the past 20 years, there's been no increase in purchasing power for technical jobs," said George McClure, a Florida engineer and past chairman of IEEE-USA's career and work force committee. "Productivity has reduced the number of jobs, and with the trend toward offshoring . . . it reduces the opportunities for newcomers."

Such fears are backed up by a RAND Corp. report last year. Analysts at the California-based think tank studied employment and salary figures since 1990 and found no evidence that a shortage of scientific and engineering workers is on the horizon. Boosting the supply, the authors warned, increases the risk that young people with years of training would enter a market where such workers are in surplus.

Federal Circuit addresses antitrust issues in Unitherm case

from Unitherm:

The district court construed the disputed claim terms in the ‘027 Patent correctly, and properly found the ‘027 Patent invalid and unenforceable for reasons of both prior use and prior sale under 35 U.S.C. § 102(b). The district court was also correct, under Oklahoma law, in allowing the jury to decide the issue of tortious interference and in accepting the jury’s findings on both liability and damages. The district court erred, however, in allowing the jury to decide Unitherm’s antitrust claims despite the total absence of economic evidence capable of sustaining those claims. We therefore affirm-in-part, vacate-in-part, and remand to the district court for further proceedings consistent with this opinion.

Friday, July 09, 2004

Settlement of infringement suit related to batteries in Toyota Prius

Energy Conversion Devices, Inc. (ECD) will share in a $30-million settlement of a patent infringement suit in federal district court in Michigan arising from assertions that the use of nickel metal hydride batteries in the Toyota Prius fell within the scope of claims of a patent of its subsidiary, Ovonic Battery Co.


Under the deal, ECD and Ovonic Battery Co. Inc., will receive a $10-million fee from Matsushita Electric Industrial Co., Panasonic EV Energy Co., (who make the battery for the Prius) and Toyota Motor Corp.


As part of the complicated arrangement, Cobasys LLC, a company co-owned by Energy Conversion and ChevronTexaco Technology Ventures LLC, will receive $20 million, according to documents filed Wednesday, July 7, 2004, with the U.S. Securities and Exchange Commission.


On receiving the $20 million, Cobasys, in turn, will pay Ovonic Battery $8 million and ChevronTexaco $8 million as partial reimbursement of legal expenses.


Cobasys and Panasonic will then cross-license patents. The companies will collaborate on the batteries that are used in electric-gasoline hybrid vehicles.



The initial suit was brought by Ovonic Battery in U.S. District Court in Detroit in March 2001, asserting that Matsushita's hybrid electric-vehicle batteries, battery components and battery systems fell within the scope of claims of patents Ovonic Battery held.

Thursday, July 08, 2004

Novartis loses in Novartis v. Abbott

Although not accepting the claim construction of the district court, the Federal Circuit, in a 2-1 vote, overturned a jury verdict and granted JMOL to Abbott. The court analyzed equivalents:

Here, the “lipophilic component” element requires at least a pharmaceutically acceptable non-surfactant lipophilic excipient capable of dissolving cyclosporin. Under Novartis’ theory of infringement by equivalence, Span 80, admittedly a surfactant according to the ’840 patent, see col. 9, ll. 47-50, col. 11, ll. 58-59, is an equivalent to the non-surfactant excipient required by the claimed “lipophilic component.” Including a chemical composition made entirely of surfactants within the scope of “lipophilic component” would be inconsistent with the claim construction of that term. We must reject Novartis’ theory of infringement by equivalence.

In an interesting "application" of SciMed to Graver Tank, the majority seemingly completely overlooked Festo (wherein one could have a nonmagnetizable sleeve (aluminum) as an equivalent to a claim element requiring a magnetizable sleeve). Pertinent text from Novartis:

See SciMed Life Sys., Inc. v. Advanced Cardiovascular, 242 F.3d 1337, 1347 (Fed. Cir. 2001) (“[I]f a patent states that the claimed device must be ‘non-metallic,’ the patentee cannot assert the patent against a metallic device on the ground that a metallic device is equivalent to a non-metallic device.”);

(...)
[In Graver Tank] The Court found that the difference between the metal silicates was insubstantial, and they therefore could be considered equivalents. Id. Notably, there was no dispute that the metal silicate element was present in the accused product. Rather, the dispute focused on a limitation of the metal silicate element.

(...)
In Graver Tank, for instance, although the accused product used manganese metal instead of an alkaline earth metal, that substitution did not transform the disputed element, i.e., metal silicate, into something that was not a metal silicate.

Overlooked in Novartis is the fact that certain metal silicates, including manganese silicate, had been claimed in claims that were invalid, and that manganese silicate was already known in the welding art (thus, "foreseeable" under Festo). The issue wasn't about "metal silicates" but rather whether manganese silicate was the equivalent of an alkaline earth silicate.

FTC case against Unocal revived

The U.S. Federal Trade Commission reversed an ALJ and thereby revived civil charges that Unocal Corp. tricked California state regulators into adopting a standard for clean-burning gasoline so it could enforce a patent against competitors.

The agency overturned an administrative law judge's November, 2003 dismissal of a complaint based on accusations by Exxon Mobil Corp. that Unocal deceived California regulators (by, among other things, neglecting to mention its patent interests) while the state was setting up clean-air standards. The El Segundo, Calif.-based company could collect as much as $150 million a year in royalties for use of its fuel-making methods.

The FTC complaint accuses Unocal of duping regulators into thinking that certain information about low-emission gasoline was in the public domain even as it pursued patents for the technology.

"The bottom line is there is no finding of fact by this commission," Unocal spokesman Barry Lane said.

"We have never been afraid of a trial in this matter, and ultimately we expect to prevail in this venue as we have in every other venue."

Sunday, July 04, 2004

TIME discusses fraudulent science publication by three Columbia University researchers

A Jaroff piece in the July 1, 2004 issue of Time highlights the 2001 publication of an apparently fraudulent study in the Journal of Reproductive Medicine (JRM) by three researchers at Columbia University. With its connection to the prestige of Columbia University and the JRM, the study was lauded in the press, printed in the New York Times, featured on ABC's Good Morning America and widely syndicated. In this, there is a similarity to the fraudulent work of Jan-Hendrik Schon, which was boosted by its connection to the prestige of Bell Labs and publication in the prestigious journals Science and Nature.

Dr. Bruce Flamm of the University of California/Irvine was skeptical. The principal author Daniel Wirth was not an M.D. (he has a law degree and a masters degree in parapsychology) had earlier published research articles claiming miraculous, supernatural healing. Flamm sent emails and critical letters to Dr. George Wied, the editor of the JRM, tried repeatedly to reach him by phone, and now, nearly three years later, had still not received a response.

Dr. Flamm also tried to contact the co-authors of the JRM article. He determined that one co-author, Dr. Kwang Cha, had left the university, and would not respond to inquiries about the publication. The other co-author, Dr. Rogerio Lobo, until recently chairman of obstetrics and gynecology at Columbia University, originally identified by the university as the teams leader, also refused calls for comment.

In the article in Time, Jaroff asks some pointed questions: How could Dr. Lobo, a respected scientist, have permitted the release of a flawed study co-authored by a medically-illiterate con man like Wirth? And why did the JRM's peer-review system fail, before publication, to detect the inconsistencies and unsound methodology in the in-vitro study? Who were the peers who vetted it? And why did both Dr. Lobo and Dr. George Wied consistently stonewall for nearly three years when challenged about the study?

There is a haunting feeling of deja vu to the earlier research frauds of Jan-Hendrik Schon of Bell Labs and Robert Slutsky of University of California of San Diego, wherein the prestige of famous institutions and high-profile journals improperly substituted for reasonable analysis of work that ultimately proved to be fabricated out of thin air. [For an earlier discussion of the Slutsky fraud, see William P. Whitely, Drummond Rennie, and Arthur P. Hafner, The Scientific Community's Response to Evidence of Fraudulent Publication, JAMA, 1994, 272, 170-173)]

Can it still happen? Sadly, yes. Additional issues are developed in Lawrence B. Ebert, "There you go again," Intellectual Property Today, pp. 34-36 (July 2004).






Saturday, July 03, 2004

Time Magazine Highlights False Scientific Publication

A Jaroff piece in the July 1, 2004 issue of Time highlights the 2001 publication of an apparently fraudulent study in the Journal of Reproductive Medicine (JRM) by three researchers at Columbia University. With its connection to the prestige of Columbia University and the JRM, the study was lauded in the press, printed in the New York Times, featured on ABC's Good Morning America and widely syndicated. In this, there is a similarity to the fraudulent work of Jan-Hendrik Schon, which was boosted by its connection to the prestige of Bell Labs and publication in the prestigious journals Science and Nature.

Dr. Bruce Flamm of the University of California/Irvine was skeptical. The principal author Daniel Wirth was not an M.D. (he has a law degree and a masters degree in parapsychology) had earlier published research articles claiming miraculous, supernatural healing. Flamm sent emails and critical letters to Dr. George Wied, the editor of the JRM, tried repeatedly to reach him by phone, and now, nearly three years later, has still not received a response.

Dr. Flamm also tried to contact the co-authors of the JRM article. He determined that one co-author, Dr. Kwang Cha, had left the university, and would not respond to inquiries about the publication. The other co-author, Dr. Rogerio Lobo, until recently chairman of obstetrics and gynecology at Columbia University, originally identified by the university as the teams leader, also refused calls for comment.

In the article in Time, Jaroff asks some pointed questions: How could Dr. Lobo, a respected scientist, have permitted the release of a flawed study co-authored by a medically-illiterate con man like Wirth? And why did the JRM's peer-review system fail, before publication, to detect the inconsistencies and unsound methodology in the in-vitro study? Who were the peers who vetted it? And why did both Dr. Lobo and Dr. George Wied consistently stonewall for nearly three years when challenged about the study?

There is a haunting feeling of deja vu to the earlier research frauds of Jan-Hendrik Schon of Bell Labs and Robert Slutsky of University of California of San Diego, wherein the prestige of famous institutions and high-profile journals improperly substituted for reasonable analysis of work that ultimately proved to be fabricated out of thin air.

Can it still happen? Sadly, yes. Additional issues are developed in Lawrence B. Ebert, "There you go again," Intellectual Property Today, pp. 34-36 (July 2004).


Friday, July 02, 2004

Duke University sues Elan over Zonegran as Weightloss Drug

In what promises to be an interesting case, Duke University, joined by Orexigen Therapeutics of Princeton, NJ, has filed sued against Elan concerning a patent application filed on May 2, 2003 by Julianne Jennings, an Elan product manager. Duke had filed a similar patent application.

The patent application of Jennings, 20040029941, was published Feb. 12, 2004. Some of the claims are as follows:

1. A method of reducing weight in an overweight subject, said method comprising: administering to an overweight subject a pharmaceutical composition comprising zonisamide, in an amount effective to reduce weight in said subject, wherein said weight loss is significant and sustained.

2. The method according to claim 1, wherein said effective amount of zonisamide is in the range of about 50 to about 1000 mg/day.

3. The method according to claim 2, wherein said effective amount of zonisamide is in the range of about 100 to about 600 mg/day.

4. The method according to claim 1, wherein said overweight subject is an obese subject

See http://msnbc.msn.com/id/5353413/.