Jeremy J. Gustrowsky

USPTO Gives New Guidance on Software Inventions

January 25, 2019

Earlier this month, the United State Patent and Trademark Office released new guidance for its Examiners to help them better determine when an invention is too abstract to be patentable. This latest effort by the Patent Office brings more clarity and predictability to the examination process for inventors seeking patent protection for software and business methods.

To be patentable, an invention must be new, useful, and unobvious. The courts have also recognized that abstract ideas and laws of nature are also not eligible for patent protection. Predicting which inventions are too abstract for patent protection has been a challenge in the past, and has become more difficult since the Supreme Court’s ruling in Alice Corp. v. CLS Bank (March, 2014). The Court of Appeals for the Federal Circuit has so far attempted to follow the Supreme Court’s guidelines on a case by case basis giving us clues as to the kinds of inventions that are too abstract to be patented. This effort has created some clarity in specific cases, but it has also created additional confusion where the Federal Circuit has given differing opinions for similar inventions. This raises the possibility that different Examiners in the same technology area may pick and choose how to handle similar inventions thus arriving at different conclusions for similar subject matter.

The Patent Office has responded with this latest guidance for the Examiner corps that attempts to synthesize the case law into a more practical legal framework that may be applied in a more predictable manner. Although they do not have the force of law, the guidelines offer valuable insights into how Examiners will determine whether the subject matter in a given application is unpatentably abstract.

Looking briefly at the substance of the latest guidance, the USPTO is revising its examination procedure by: (1) Providing groupings of subject matter that it considers to be an abstract idea; and (2) clarifying that a claim is not ‘‘directed to’’ a judicial exception if the judicial exception is integrated into a practical application of that exception.

On the first point, the Patent Office sees three separate categories of material that are unpatentably abstract:

  1. Mathematical Concepts: Mathematical relationships, mathematical formulas or equations, mathematical calculations
  2. Methods of Organizing Human Activity: Fundamental economic principles or practices (including hedging, insurance, mitigating risk); commercial or legal interactions (including agreements in the form of contracts; legal obligations; advertising, marketing or sales activities or behaviors; business relations); managing personal behavior or relationships or interactions between people (including social activities, teaching, and following rules or instructions)
  3. Mental Processes: Mental processes—concepts performed in the human mind (including an observation, evaluation, judgment, opinion).

According to the guidelines, concepts that do not fit one of these categories are probably not abstract ideas. The Patent Office does leave open the possibility that exceptional cases could arise where the concept is too abstract to be patented, but also does not fit into one of these categories.

On the second point, the Patent Office explains that even if the claims do fall within one of the three groupings above, they may still be eligible for patent protection if the abstract concept is integrated into a practical application of that concept. A “practical application” is one that applies, relies on, or uses the concept “in a manner that imposes a meaningful limit on the abstract concept.”

The new guidance represents a noteworthy change in the way applications will be handled by Examiners, and it marks the latest attempt by the Patent Office to bring clarity and predictability to the process. It is also important to note that this is not a change in the statute approved by Congress, nor is it a change to the legal framework that has been endorsed by the Federal Circuit or the Supreme Court. It remains to be seen then, what the long-term effect of this change will be on applications currently under examination, and what affect, if any, it will have on patent litigation going forward.

Woodard, Emhardt, Moriarty, McNett & Henry LLP Promotes Two to Partnership

January 3, 2018

Woodard, Emhardt, Moriarty, McNett & Henry LLP is proud to announce that Jeremy Gustrowsky and Michael Morris have been named to the firm’s partnership, which was effective January 1, 2018.

Jeremy Gustrowsky focuses on all areas of intellectual property. He assists clients with a wide variety of needs to plan and execute strategies for protecting their ideas and branding their products and services. He has significant experience in preparing and prosecuting patent applications in the U.S. and abroad for a broad range of products. He also assists in litigation and dispute resolution matters.
He is a graduate of Indiana University Robert H. McKinney School of Law (J.D., 2010) and University of North Carolina at Asheville (B.S., 1999)

Michael Morris practices in all areas of intellectual property, including providing services for identifying, procuring, and enforcing intellectual property rights. In particular, he has significant experience in preparing and prosecuting medical device and mechanical patent applications in the U.S. and abroad; providing freedom-to-operate, infringement/non-infringement, invalidity/validity opinions and monitoring competitor IP.
He is a graduate of Indiana University Maurer School of Law (J.D., 2011) and Rose-Hulman Institute of Technology (B.S., 2008)

Software Patentability v. A Review of 2016 Federal Circuit Opinions

January 19, 2017

The January patent prosecution practice luncheon included a discussion of highlights from 2016 Federal Circuit opinions that addressed the patentability of software inventions. Although the Federal Circuit continued its trend of invalidating most of the software patents it reviewed, several cases offered software patent holders new cause for optimism. To view the presentation, visit:   Alice Corp Update 2016 Cases from Woodard, Emhardt, Moriarty, McNett and Henry LLP

House Passes Federal Trade Secret Bill

April 28, 2016

The House on Wednesday passed the Defend Trade Secrets Act of 2016 which would allow individuals and companies to fight trade-secret theft in federal court. The Senate already voted to approve the bill earlier this month, and President Obama is expected to sign it into law.

Trade secrets include customer lists, recipes, procedures, blueprints, and other accumulated proprietary knowledge that provides businesses with a competitive advantage in the marketplace. Such proprietary information provides hundreds of billions of dollars in annual revenue and millions of jobs.

Currently, federal trade secret protection is only available by requesting the Justice Department to intervene. Companies or individuals cannot file a federal lawsuit and must therefore address the issue in state courts. This can mean added complexity and expense when dealing with various state courts with differing laws, particularly when a trade secret case involves multiple states.

The Defend Trade Secrets Act would authorize individuals and companies to file a civil lawsuit in federal court for the misappropriation of a trade secret that is related to products or services involved in interstate or foreign commerce. Besides the potential for reduced cost and complexity, the law provides options for enforcement that are beyond what state courts are typically willing to do. For example, a seizure provision allows a company to ask for the government to seize its trade secrets prior to giving any notice of the lawsuit to a potential defendant.

The Obama Administration has thus far supported the Defense of Trade Secrets Act. In a statement released earlier this month, the President said he “strongly supports” the legislation and its effort to make trade secret protection “more uniform, reliable, and predictable.”

Contact us if you have any questions on this or any other aspect of intellectual property protection.

Federal Circuit Finds the Disparagement Provision of the Lanham Act Unconstitutional

February 29, 2016

This presentation provides information concerning the recent In re Tam case in which the Federal Circuit held that the disparagement provision of §2(a) of the Lanham Act is unconstitutional because it violates the First Amendment right of free speech. It also discusses the impact of this holding on the currently pending Redskins case. To view the presentation, visit:  In re tam presentation from Woodard, Emhardt, Moriarty, McNett and Henry LLP

Domain Disputes and a Review of the Uniform Domain-Name Resolution Policy (UDRP)

June 9, 2015

The presentation below provides information concerning the Uniform Domain-Name Resolution Policy (UDRP) as well as the recent Uniform Rapid Suspension (URS) procedures. This presentation discusses the nuts and bolts of filing complaints as well as the elements required to file a UDRP action. In addition, the presentation provides an overview of the UDRP process and practical tips on how to handle the UDRP and URS processes. To view the presentation, visit: Domain Disputes from Woodard, Emhardt, Henry, Reeves & Wagner, LLP

Patent Examination Guidelines in View of the Alice Decision Presentation

August 22, 2014

The following presentation discusses the recent patent examination guidelines for patentable subject matter issued by the USPTO concerning the recent Alice decision. To view the presentation, visit: Examiner Guidelines from Woodard, Emhardt, Henry, Reeves & Wagner, LLP

Supreme Court Confirms that First Sale Doctrine Applies to Lawful Foreign Sales

March 21, 2013

Is a person who lawfully obtains a book from overseas allowed to redistribute the book in the United States without paying royalties to the original copyright owner?

That is the question the Supreme Court addressed in its ruling in Kirtsaeng v. John Wiley & Sons, Inc., which issued on March 19, 2013. The Supreme Court held that a purchaser is protected under the “first sale” doctrine of copyright law when reselling a copyrighted work in the United States provided it was lawfully manufactured and purchased abroad.

Kirtsaeng, a foreign student studying in the United States as a graduate student, had his friends and family in Thailand buy copies of English language textbooks produced for sale outside the United States from Thai book stores, where prices were low compared to U. S. book stores. He would then have the books mailed to him in the United States where he would resell them, reimburse his family and friends, and keep a profit.

John Wiley & Sons, publishers of some of the books Kirtsaeng resold, sued him for the unauthorized distribution of copyrighted works. Kirtsaeng argued Wiley’s distribution rights had been “exhausted” in the first sale which occurred overseas where the books were printed by one of Wiley’s subsidiaries. The “first sale” doctrine in U. S. copyright law provides that once a copyright holder sells a copyrighted work, subsequent owners may sell or otherwise transfer that copy of the work as they wish. The original distribution rights in that copy have been “exhausted.” Wiley countered that the first sale doctrine did not apply to copies of works made outside the United States.

Kirtsaeng lost in the lower courts, but in a 6-3 decision authored by Justice Breyer, the Supreme Court reversed stating that the “first sale” doctrine applies to copies of copyrighted works lawfully made abroad. In the Court’s view, the Copyright Act, “its context, and the common-law history of the “first sale” doctrine, taken together, favor a non-geographical interpretation” which meant a “first sale” abroad exhausted distribution rights in the work in the United States as well. The Court said reading a geographical restriction into the statute created “linguistic difficulties” creating more confusion than it solved. The court also stated it was doubtful “Congress would have intended to create the practical copyright-related harms with which a geographical interpretation would threaten ordinary scholarly, artistic, commercial, and consumer activities.” Among these harms, the Court examined a number of what it believed would be excessive restraints on free commerce likely to result from libraries, bookstores, tourists, and others having to obtain permission to later resell a book printed and obtained lawfully overseas.

If you have any questions regarding this case or any other copyright related matters, please contact us here at Woodard, Emhardt, Moriarty, McNett & Henry LLP.

Saving High-tech Innovators from Egregious Legal Disputes, or SHIELD Act

March 18, 2013

Representatives Peter DeFazio (D-Ore.) and Jason Chaffetz (R-Utah) recently reintroduced H.R. 845, the Saving High-tech Innovators from Egregious Legal Disputes, or SHIELD Act. The bill seeks to “protect American tech companies from frivolous patent lawsuits that cost jobs and resources” by implementing a “loser pays” system for patent infringement cases brought by some types of non-practicing entities (sometimes referred to as “patent trolls). The SHIELD Act would not apply to plaintiffs in lawsuits where the plaintiff invented the patent or produced evidence of having made a substantial investment in bringing the patent to market.

Both members of Congress first submitted the bill last August, but it failed to get enough support to pass. This time around, the co-sponsors believe its chances of passing are much better. It now covers all industries, not just the high tech industries covered in the previous bill. Support for the new bill has come from groups like the Consumer Electronics Association, the Electronic Frontier Foundation, Engine Advocacy, the National Retail Federation, the Coalition for Patent Fairness, and the Consumer and Communications Industry Association.

Also, President Obama has made recent statements suggesting he is in favor of making further changes to the patent system in this area as well. During a recent Google Hangout appearance online, President Obama specifically mentioned the problem patent trolls present to businesses, old and new. He stated that the America Invents Act passed last year and fully in effect this month “hasn’t captured all the problems.” He addressed the issue of non-practicing entities that “don’t actually produce anything themselves” but that are “just trying to essentially leverage and hijack somebody else’s idea” to “see if they can extort some money out of them.” President Obama mentioned that “our efforts at patent reform only went about halfway to where we need to go” and an additional consensus needed to be reached on “smarter patent laws.”

As H.R. 845 has resurfaced in a new form, new questions regarding its final wording, the scope of its coverage, and its effectiveness in dealing with patent trolls have reappeared as well. We will continue to provide you with updates regarding this important legislation as it proceeds through Congress.

Jeremy Gustrowsky Presents on Copyright Issues Related to Software and Websites

January 28, 2013

Jeremy Gustrowsky has prepared a presentation regarding copyright issues related to software and websites. The presentation includes a discussion on what is protectable and how protection is best attained. To view the presentation, visit: Copyright Issues Related to Software and Websites from Woodard, Emhardt, Henry, Reeves & Wagner, LLP

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