What Are the Most Important IP Protections for U.S. Businesses?

A recent study reveals that most U.S. businesses view trademarks and trade secrets as the most important forms of intellectual property (IP) protection. The study was conducted by the National Science Foundation (NSF) and the U.S. Census Bureau as part of their Business R&D and Innovation Survey (BRDIS).

According to a NSF press statement, the survey polled a nationally representative sample of about 40,000 companies, including companies in both manufacturing and non-manufacturing industries. Here’s what else they had to say:

Fifteen percent of all businesses reported trademarks as either very important or somewhat important to their business (6 percent said trademarks were very important, while 9 percent said they were somewhat important).
Fourteen percent of surveyed businesses reported trade secrets as very important or somewhat important (6 percent and 8 percent respectively).
Twelve percent of those surveyed identified copyrights as important.
Five percent of respondents indicated that design patents are important, while four percent viewed utility patents as an important form of IP protection.
“Much of today’s business derives its competitive advantage from the ability to protect and exploit exclusive rights over investments in intellectual property,” said John Jankowski, lead author of the report in NSF’s National Center for Science and Engineering Statistics. “Hence, IP protection is a persistent and recurrent concern of businesses.”

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Supreme Court Will Review Attorneys’ Fees Award

The U.S. Supreme Court granted certiorari in John Wiley & Sons Inc. v. Kirtsaeng, No. 15-375 (cert. granted January 15, 2016). The issue in this case is the appropriate standard in awarding attorneys’ fees to a prevailing party under Section 505 of the Copyright Act.

There are currently four different standards used by district courts for awarding attorneys’ fees: (1) whether the prevailing party’s successful claim or defense advanced the purposes of the Copyright Act (9th and 11th Circuits); (2) a presumption in favor of attorneys’ fees for a prevailing party (5th and 7th Circuits); (3) the four “non-exclusive factors” listed in Fogerty v. Fantasy, Inc., 510 U.S. 517, 534 n.19 (1994) (3rd, 4th, and 6th Circuits); and (4) the 2nd Circuit’s placement of “substantial weight” on the objective reasonableness of the losing party’s claim.

In this case, a college student sought to win attorneys’ fees after defeating claims he imported and illegally sold foreign edition textbooks on eBay.  The case first reached the Supreme Court in 2013 where it was held that the Copyright Act’s first-sale doctrine applies to goods made anywhere.

As a result of the ruling, Kirtsaeng did not have to pay $600,000 in damages to Wiley for willfully infringing the company’s copyrights. However, Kirtsaeng lost his bid to obtain attorneys’ fees from Wiley, which lead to the present case.

Stay tuned for more information as the case develops.

Copyright FAQ: Who Has the Rights to a Collective Work?

Special copyright rules apply to collective works under the Copyright Act.  A collective work is defined as a work “in which a number of contributions, constituting separate and independent works in themselves, are assembled into a collective whole.” Common examples include magazines, academic journals, anthologies, and encyclopedias.  The articles, columns, or short stories that make up the collective work are referred to as “contributions to a collective work.”

The copyright in a collective work covers only the collective work as a whole (i.e., the order and organization of the entire magazine or encyclopedia). Thus, the copyright in each individual contribution is distinct from the larger work.

In the absence of an express transfer from the author of the individual article, the copyright owner in the collective work is presumed to have acquired only the right to use the contribution in the collective work and in subsequent revisions and later editions of the collective work. However, in many cases, authors submitting articles to magazines and journals must agree that they will not retain a copyright to the work once it is published as part of a collective work.

For individual advice on the copyrights to a contribution to a collective work, please contact me.

Supreme Court Will Review Claim Construction Standard

The U.S. Supreme Court granted certiorari in Cuozzo Speed Technologies, LLC v. Lee, U.S. No. 15-446 (cert. granted January 15, 2016).  There are two issues in this case.

The first issue is in regards to the claim construction standard used during Inter Partes Review (IPR) proceedings before the Patent Trial and Appeal Board (PTAB).  Currently, the PTAB construes the claims of an issued patent in an IPR proceeding according to their broadest reasonable interpretation.  This standard is different than the “plain and ordinary meaning” standard used in federal district court. The question is whether or not the PTAB is using the correct claim construction standard, or if it the claims should be interpreted according to their plain and ordinary meaning.

The second issue is whether or not the PTAB’s decision to institute an IPR proceeding is judicially unreviewable. In Cuozzo, the Federal Circuit held that 35 U.S.C. 314(d) bars it from reviewing a PTAB decision to institute an IPR, even if the issue is raised in an appeal of a PTAB final decision.

Stay tuned for more information as the case develops.

What Are the Most Important IP Protections for U.S. Businesses?

A recent survey reveals that most U.S. businesses view trademarks and trade secrets as the most important forms of intellectual property (IP) protection. The study was conducted by the National Science Foundation (NSF) and the U.S. Census Bureau as part of their Business R&D and Innovation Survey (BRDIS).

According to a NSF press statement, the survey polled a nationally representative sample of about 40,000 companies, including companies in both manufacturing and non-manufacturing industries. Here’s what else they had to say:

  • Fifteen percent of all businesses reported trademarks as either very important or somewhat important to their business (6 percent said trademarks were very important, while 9 percent said they were somewhat important).
  • Fourteen percent of surveyed businesses reported trade secrets as very important or somewhat important (6 percent and 8 percent respectively).
  • Twelve percent of those surveyed identified copyrights as important.
  • Five percent of respondents indicated that design patents are important, while four percent viewed utility patents as an important form of IP protection.

“Much of today’s business derives its competitive advantage from the ability to protect and exploit exclusive rights over investments in intellectual property,” said John Jankowski, lead author of the report in NSF’s National Center for Science and Engineering Statistics. “Hence, IP protection is a persistent and recurrent concern of businesses.”

Can Interviews Improve Patent Quality?

During patent prosecution, a patent applicant can request an interview with the examiner to discuss the pending application. The USPTO thinks that these interviews may improve the quality of patents.  The USPTO has always believed that well-documented interviews can help foster high quality patents by enhancing understanding and issue-resolution. However, it now has the data to support these claims.

The USPTO recently analyzed data on patent quality in applications where interviews were held as well as where interviews were not held. The study included data from over 22,000 applications from the past five years.

The findings revealed that interviews conducted prior to final disposition (allowance or final rejection) of the application increase the probability that the subsequent action will be in full compliance with all applicable quality standards. In addition, the data showed that interviews help decrease both improper allowances and improper rejections by approximately 40 percent compared to applications without interviews prior to the final disposition.

As a representative of the USPTO states, “The correlation is not surprising, but its degree certainly is impressive. A 40 percent improvement is almost always worth investing in. And while other factors may contribute to the correlation, it is substantial in any event.” Based on the findings, the USPTO encourages both examiners and applicants to consider the use of interviews.

Supreme Court Overturns Federal Circuit on Vague Patents

In a major patent law decisions released in 2014, the US Supreme court overturned a Federal Circuit standard for determining when a patent is invalid as indefinite. The case involved a dispute between Nautilus and Biosig over a patent for a heart-rate monitor mounted on exercise equipment.
When Biosig sued Nautilus for patent infringement, Nautilus brought a motion for summary judgment on the grounds that the term “spaced relationship” as used in the patent was indefinite.
The Federal Circuit found that the term was sufficiently definite and that a person “skilled in the art” would know what it meant.
The Federal Circuit had long applied a standard that patents could only be found invalid as indefinite if they were “insolubly ambiguous.” The Supreme Court found that this standard was too indulgent to patent owners.
According to the Supreme Court,
A patent is invalid for indefiniteness if its claims, read in light of the patent’s specification and prosecution history, fail to inform, with reasonable certainty, those skilled in the art about the scope of the invention… The Federal Circuit’s standard, which tolerates some ambiguous claims but not others, does not satisfy the statute’s definiteness requirement…. To tolerate imprecision just short of that rendering a claim “insolubly ambiguous” would diminish the definiteness requirement’s public-notice function and foster the innovation-discouraging “zone of uncertainty.”
The Court ordered the Federal Circuit to reconsider its decision that Biosig’s patent claim was not indefinite.
Nautilus was supported in its appeal by Amazon, Google, and other companies that complained they were often sued by non-practicing entities (sometimes called “patent trolls”) for alleged infringement of software patents with ambiguous claims.
The federal government supported the position of Biosig and asked the court to hold that a patent should not be found indefinite if the claim would be “reasonably clear” to a person skilled in the art.