Defensive Publication Solution

Transcription

1 Defensive Publication Solution IP.com s Defensive Publication Solution: Post- Alice vs. CLS Relief By Mark O Donnell, Vice President Client Solutions Defensive Publishing Page i A White Paper by IP.com February 2015

2 Table of Contents Uncertainty & Risk for Software Companies... 1 Why You Should Be Concerned... 1 Defensive Publishing: Mending the Fabric... 4 IP.com: The Top Performer in Defensive Publishing... 6 Patent Application Rejections Based on IP.com Defensive Publications (samples)... 7 Search Statistics: Searches Targeted at the IP.com Defensive Publication Database... 9 Implementing A Defensive Publishing Program Deciding to Defensively Publish When to Keep an Invention a Trade Secret When to File a Patent Application About the Author Defensive Publishing Page ii

3 Uncertainty & Risk for Software Companies In the wake of the June, 2014 decision in the Alice Corporation v. CLS Bank International 1 case (Alice), the priority of making defensive publishing a key component of your overall IP strategy has never been more essential. The entire framework of software and business methods patents has been tattered. The uncertainty of how this framework will be mended is high. IP.com offers a highly cost effective solution to mitigate your IP risks through its Defensive Publishing Service, a solution that has been validated for the past 15 years by the top patent and trademark offices around the world and over 250 public corporations. IP.com s Defensive Publication Database is the largest, fastest growing, and most cited by Patent Examiners. Why You Should Be Concerned In an October 2014 article, Alice decision a big reason for sharp fall in US patent litigation, Richard Lloyd states: We ve seen in the wake of Alice 15 decisions in the federal courts involving software or business method patents 13 of those have struck the patents down. The other two have said this is a motion to dismiss, come back on summary judgment. So I don t think that no software patents will survive but I do think that a wide swathe of patents that were written in a period when we didn t pay any attention to patentable subject matter are vulnerable. And if you combine that with a couple of other factors, like the increased willingness of courts to grant attorney s fees against plaintiffs if their cases are weak and the fact that it s now a lot cheaper to go to the patent office and get IPR or covered business method review, I think a lot of the business model that was driving the growth in litigation which involved suing everybody in the industry with this very broad, general patent is just less attractive than it used to be. 2 Data released by Lex Machina showed that there had been a 40% fall in patent suits in September 2014 as compared to the same month in the previous year. Commenting to IAM on the reasons for the decline, Professor Mark Lemley, founder of Lex Machina, claimed that much of it could be attributed to the Supreme Court s Alice v. CLS decision. The Alice judgment was handed down toward the end of June. 3 While confirming the decline first detected by Lex Machina, the Unified Patent research further analyzes where it has occurred. The data shows that it can be almost completely explained by a drop-off in non-practicing entity (NPE) suits in the high-tech sector. 1 Supreme Court of the United States. Syllabus. ALICE CORPORATION PTY. LTD. v. CLS BANK INTERNATIONAL ET AL. No , 19 June Web. 2 Lloyd, Richard. Alice decision a big reason for sharp fall in US patent litigation, says Mark Lemley. Iammagazine.com/blog. 9 Oct Web. 3 Wild, Joff. NPE suits down a massive 35% in the third quarter of the year as Alice and the AIA take their toll. Iam-magazine.com/blog. 28 Oct Web. Defensive Publishing Page 1

4 Litigation initiated by operating companies fell by just 19 quarter-on-quarter, but actions launched by NPEs dropped by 301, from 885 in Q2 to a fall of Software and financial organizations filing new patent applications, or those that filed pre-alice and are currently in prosecution, can expect a pull back and period of evaluation to assess the nature of the inventive steps and claims as they relate patentability and enforceability. Meanwhile, while the IP professionals are writing the final chapter on the future of software and business methods patents, products and processes continue to go to market. The logical strategy is to ensure freedom to practice in lieu of the exclusionary rights provided by a patent. The Alice decision serendipitously came at a time when legislation to thwart NPE practices was at a premiere in political circles. NPEs are finding themselves at crossroads as a large number of cases are being withdrawn or asserted patents invalidated. One reason for this is that software and business methods patents make up large portions of most NPEs portfolios. Perhaps this is due to the murkiness of the claims in many of these patents and the ability to flex the interpretation as needed. Six months since its issuance, the Alice decision has been applied by the courts, PTAB, and PTO alike to invalidate or reject software-based patent claims. With few decisions upholding patent-eligibility, the post-alice trend has been overwhelmingly against software-based patent claims. On the other hand, the DDR Holdings opinion and the small number of other patentee-favorable decisions, as well as the most recent PTO examination guidelines, offer a glimpse of hope for those interested in defending software claims against 101 attacks. 5 Many patents merely provide exclusive rights only to incremental improvements, with questionable commercial value to the enterprise to which they are assigned. The question of the ultimate importance of obtaining a patent on a particular innovation lies with the individuals and corporations making prosecution decisions on these innovations, assessing their ultimate strategic value. What is well known in the IP industry, but not so well known by C-level executives of corporations, is that many unnecessary patents exist in their portfolios patents that represent a large capital investment with little or no associated return on investment (ROI) or strategic value. 4 Wild, Joff. NPE suits down a massive 35% in the third quarter of the year as Alice and the AIA take their toll. Iam-magazine.com/blog. 28 Oct Web. 5 Albert, Jennifer A, Schreiner, Stephen T, and Li, Ce. Impact of the Alice V. CLS Bank Decision A Year- End Review. 19 Dec Defensive Publishing Page 2

5 Consider the approximate cost of filing and maintaining a patent worldwide, shown in the table below. Event Costs (approximation in U.S. dollars) Filing & Translations 30,000 Examination & Grant 11,000 Annuities 112,000 TOTAL $153,000 Table: Patent Costs 6 At approximately $153,000 to prosecute and maintain a worldwide patent over its lifetime, obtaining exclusionary rights on a technology that has questionable value to the business is an expensive endeavor. Pharmaceutical patent prosecution costs are far north of these figures. 6 Calculated from data obtained from: Brown & Michaels PC. Brown & Michaels Budget Estimator for Patents Web Defensive Publishing Page 3

6 Defensive Publishing: Mending the Fabric A clear path for software companies, technology companies with software components, and banks has been created to secure their freedom to practice for a much lower capital investment than obtaining patents demands. In addition, obtaining a valid defensive publication is a certainty; obtaining a patent is not, especially if the subject matter is software or business methods related. That path forward is adopting a Defensive Publishing program as part of the overall IP strategy of your corporation. Much to their credit and insightfulness, IBM long ago adopted this practice, which has paid off generously: their patent licensing revenues exceed $1 billion. 7 Defensive publishing is an intellectual property strategy used to prevent another party from obtaining a patent. The strategy consists of disclosing an enabling description of the invention to force it into the public domain so it becomes prior art. A defensive publication may serve to defeat the novelty of a subsequent patent application. Defensive publications provide a corporation with the means to secure freedom to operate, while sacrificing exclusionary rights to practice the invention. For a few hundred dollars, a company can effectively secure freedom to operate, block a competitor s patents from issuing, reduce unnecessary prosecution and filing expenses, and mitigate the risk of eroding the value of their foundational patents by circumventing their competitor s ability to picket fence them with patents. Most importantly, the defensive publishing of invention disclosures, back files, product manuals, and the abandonment of provisional applications provides patent examiners with the ammunition required to combat questionable patent applications from issuing as patents. In addition, Defensive Publishing increases the overall quality of patents issuing and decreases the leverage that NPEs have on various segments of industry. A solid defensive publication strategy is not only easy to implement, but also extremely cost effective. The practice of prosecuting your core differentiating technologies as patents, while disclosing your non-core, non-commercial, and operational innovations as prior art provides the following benefits: Frees you to practice technology enablement(s) Reduces your overall infringement risk profile Defends against assertion of overly broad patents Strengthens your foundational patents in the portfolio (i.e. prevents competitors from employing picket fencing strategies that ultimately erode the licensing potential of those foundational patents) Builds a repository of prior art that ultimately serves as a shield to NPE assertions 7 Quinn, Gene. IBM s Formula for Success: Patents, Patents and more Patents. IP Watchdog. 11 Jan Web Defensive Publishing Page 4

7 An aggressive and well-planned defensive publishing strategy increases the agility of the software industry with respect to taking products and services to market more rapidly, and relieves the enormous backlog at the United States Patent and Trademark Office (USPTO), allowing the more clearly patentable subject matter efficient movement through the system. An article by the SAS Institute, SAS Supports White House Efforts to Curtail Patent Trolls 8, illustrates the value of using defensive publishing as a weapon against patent trolls. Tim Wilson states that SAS will be publishing 40 years of their technical documentation to IP.com s Prior Art Database, in order to make the documents available to the USPTO. 8 SAS supports White House efforts to curtail patent trolls. SAS.com. 20 Feb Web. Defensive Publishing Page 5

8 IP.com: The Top Performer in Defensive Publishing IP.com s Prior Art Database has been in existence since the company was founded in It is the world s first and largest online prior art disclosure service. It is an essential source of non-patent literature for IP professionals, attorneys, corporate researchers and development staff, libraries, and universities. To attest to its value, the Prior Art Database is a required reference for patent examiners, as described in Rule 34 of the 11th Session of International Authorities under the Patent Cooperation Treaty (PCT). Leading technology companies use defensive publication to strengthen their core patents and reduce freedom to operate risk. With content exclusive to IP.com, the Prior Art Database is dedicated to providing the world with access to prior art technical-disclosure documents. Its sole purpose is to enable the creation of, and access to, prior art documents. The Prior Art Database is home to a wide array of technical disclosures including many from Fortune 10 companies. In addition to anonymous publications from many prominent companies, the database houses disclosures published with full authorship information from innovative companies such as IBM, Motorola, Siemens, and many more. The Prior Art Database is the exclusive location for IBM Technical Disclosure Bulletin (TDB) documents on the web. Source: InnovationQ Defensive Publishing Page 6

9 Patent Application Rejections Based on IP.com Defensive Publications (samples) Source: Patent River 35 U.S.C. 103 Rejection: Fails non-obviousness test U.S. Patent Application, Serial Number 12/199,370 citing IPCOM on 27 OCT 2011 Amendments to the Claims Applicants have amended claims 1, 9, 16, 23-24, and 27, and have cancelled claims 25-26, in this application. Applicants are not conceding in this application that those claims are not patentable over the art cited by the Examiner, as the present claim amendments and cancellations are only for facilitating expeditious prosecution of allowable subject matter. Applicants respectfully reserve the right to pursue the original claims and other claims in one or more continuations and/or divisional patent applications. 35 U.S.C. 103 Rejections Claims 1-5, 8-11, 14, 16-18, and are rejected under 35 U.S.C. 102(b) as allegedly being unpatentable over U.S. Pat. No. 7,676,280 issued to Bash, et al ("Bash") in view of "Dynamic Thermal Mapping And Trend Analysis As A Control Mechanism For HVAC Systems In Data Centers", IP.com, IPCOM D, 03/27/2006 of IBM ("IBM"). Claims 6-7, 12-13, and are rejected under 35 U.S.C. 103(a) as allegedly being unpatentable over Bash in view of IBM, and further in view of U.S. Pat. No. 6,747,872 issued to Patel, et al ("Patel"). Claim 15 is rejected under 35 U.S.C. 103(a) as allegedly being unpatentable over Bash in view of U.S. Pub. No. 2006/ to Wilson, Jr., et al ("Wilson"). Claim 25 is rejected under 35 U.S.C. 103(a) as allegedly being unpatentable over Bash in view of IBM, and further in view of 35 U.S.C. 103 Rejection: Fails non-obviousness test U.S. Patent Application, Serial Number 10/279,951 citing IPCOM on 27 JUN 2006 Claims 3, 4, 6, 7, 15-17, 10,11,13,14, and are rejected under 35 U.S.C. 103(a) as being unpatentable over Nusbaum, et al., "WebSphere Application Servers: Standard and Advanced Editions," IBM Corporation, IBM Redbooks, First Edition, July 1999, [hereinafter "WebSphere"], in view of IBM TDB, "Optimizing and Minimizing Portlet Round Trips to a Portal Server," IBM Technical disclosure, downloaded from IP.com, IP.com number: IPCOM D, original publication date: September 1, 2001, [hereinafter "IBMTDB"]. Summary of Examiner's Rejections: Prior to the Office Action mailed June 27, 2006, Claims 1-20 were pending in the Application. Defensive Publishing Page 7

10 In the Office Action, the Drawings were objected to as containing text that was illegible. The Specification was objected to for missing status information of copending applications. Claims 3, 7, and were rejected under 35 U.S.C. 112, second paragraph. Claims 1, 2, 5, 8, 9 and 12 were rejected under 35 U.S.C. 102(b) as being anticipated by Nusbaum et al. ("WebSphere Application Servers: Standard and Advanced Editions", IBM Corporation, IBM Redbooks, First Edition, July 1999, hereinafter "WebSphere"). Claims 3, 4, 6, 7,10,11 and were rejected under 35 U.S.C. 103(a) as being unpatentable over WebSphere in view of IBM TDB, "Optimizing and Minimizing Portlet Round Trips to a Portal Server" (IBM Technical Disclosure, downloaded from IP.com, IP.com number: IPCOM D, original publication date: September 1, 2001, hereinafter "IBMTDB"). 35 U.S.C. 103 Rejection: Fails non-obviousness test U.S. Patent Application, Serial Number 10/806,871 citing IPCOM on 19 SEP 2006 (not stated in the rejection by-number; found in the Form 892) Claims 1-2, 5, 7-12, and 24 The Examiner has rejected claims 1-2, 5, 7-12, 15, 17-19, 22, and 24 under 35 U.S.C. 103(a) as being unpatentable over Matsubara et al., U.S. Patent No. 6,381,679 Bl (hereinafter "Matsubara") in view of Anonymously Disclosed, Method for the Dynamic Prediction of Nonsequential Memory Accesses, September 25, 2002 (hereinafter "Anon"). This rejection is respectfully traversed. In rejecting the claims, the Examiner states: As per claims 1 and 18, Matsubara discloses a method in a data processing system for providing hardware assistance to prefetch data during execution of code by a processor in the data processing system, the method comprising: responsive to loading an instruction in the code into a cache, determining, by a processor unit, whether a prefetch indicator is associated with the instruction (col. 5, lines 1-10; col. 6, lines 35-42; col. 7, lines 10-20; Fig. 1; Fig. 2, elements 21 and 22). It should be noted that computer program product in claims executes the exact same functions as the methods in claims 1-7. Therefore, any references that teach claims 1-7 also teach the corresponding claims It should also be noted that the "indication bits (i.e. PF bits)" are analogous to the "prefetch indicator" and the "CPU 21" is analogous to the "processing unit" and responsive to the prefetch indicator being associated with the instruction, selectively prefetching data into the cache in the processor (col. 6, lines 53-55; Fig. 2, elements 21 and 22). Matsubara does not expressly disclose a pointer to a data structure identified by the prefetch indicator. Anon discloses a pointer to a data structure identified by the prefetch indicator. (General Description, 1st paragraph and 4th paragraph; Detailed Description, 1 st paragraph). It Defensive Publishing Page 8

11 should be noted that the "dynamic prefetch pointer" is analogous to the "pointer to a data structure." Matsubara and Anon are analogous art because they are from the same field of endeavor, that being prefetching memory systems. Search Statistics: Searches Targeted at the IP.com Defensive Publication Database Source: InnovationQ Defensive Publishing Page 9

12 Implementing A Defensive Publishing Program A well-balanced IP management strategy both serves the strategic interests of your company and promotes patent quality. Such a strategy must consist of three primary decision paths that ask the following questions. Do we Defensively publish an enablement of the invention? Keep the invention a trade secret? File a patent application? Deciding to Defensively Publish Two main factors influence the decision to implement a defensive publication tactic. You should defensively publish when you: 1. Acknowledge that the cost of patenting outweighs the benefit of the monopoly afforded by the exclusive rights provided by a patent 2. Determine that the invention cannot be protected in a manner that is sufficiently secure to support trade-secret protection Inventions on your Patent Committee s decision block are not the only documents that must be considered. Documents such as user manuals, marketing collateral, maintenance manuals, drawings, and archived back files of almost any kind can serve as valuable references to the examiner when establishing the current body of prior art during patent prosecution. These documents can all serve as content for a defensive publication. These documents are important to you and to the industry as a whole because the body of prior art that exists at the time you file a patent application on an important innovation directly benefits from that prior art. When your patent attorney drafts the claims for your patent applications, you want your claims to be unique over the prior art. The more accessible the prior art is to the agents and examiners, the stronger your claims will be. When considering defensive publishing, keep in mind that under the America Invents Act (AIA), the author/inventor has a one-year grace period from the date of publication on an invention, ensuring the inventor s rights to file a patent on the subject are preserved up to that date. Therefore, even if you decide to defensively publish, there are provisions in the law that allow you to proceed with a patent application at a future date. A defensive publication, with the exception of a one-year grace period in the U.S. for the inventor, immediately extinguishes patent rights, and after one year (in the U.S.), even those of the inventor. A decision to publish is a decision to permanently surrender potential patent rights. These decisions should be made in the context of a comprehensive IP strategy. Defensive Publishing Page 10

13 When to Keep an Invention a Trade Secret An invention is a good candidate for trade-secret protection when: 1. The invention is complex and so unique to the industry that it is unlikely that a competitor can independently arrive at a similar solution 2. The novel portions of the innovation are difficult for a competitor to reverse engineer 3. The level of protection on the secret is tight enough to make it impossible for a single person to walk away from the innovation (e.g., soft drink flavoring compositions, fragrance formulations, etc.) When to File a Patent Application IP strategies and the motivations behind them vary widely from one corporation to the next. IP strategies largely depend on the competitive landscape in which a company exists, as well as the maturity of the industry and the related technologies. The most obvious purpose for pursuing a patent is to gain exclusive rights to a key technology for commercial exploitation. Other IP strategies consist of blocking, defense, licensing, cross licensing, picket fence prevention, corporate reputation, posterity, and portfolio size. A more cost effective and immediate means of realizing many of these strategies is through an aggressive defensive publication strategy. With an extremely uncertain future for the validity of software and business methods patents, it makes sense to take alternative measures to mitigate your infringement risk and protect your freedom to operate. This can be done at a fraction of the cost, time, and resource commitment required to prosecute patents. Defensive Publishing will buy you some peace of mind until we better understand where the post-alice v. CLS chips fall. Defensive Publishing Page 11

14 About the Author Mark O Donnell is Vice President of Client Solutions for IP.com, LLC. He has 23 years of experience in engineering, intellectual property research, and business management. Prior to his roles at IP.com, Mark owned and operated a defense contracting business reporting to DHS. He also served as Imaging Scientist and Optical Engineer at the Xerox Corporation and Eastman Kodak Company. Mark founded IP.com s Patent Research Services in He now serves IP.com as an IP subject matter expert, assisting with product development and sales of its flagship product, InnovationQ. Defensive Publishing Page 12