Issue 4 June 2001
This is the fourth issue of Directions, a newsletter from TechRoadmap Inc. discussing intellectual property issues and ideas. We hope to stimulate you to examine and improve your own IP practices. In this month's issue we return to a painful situation - losing your patent rights because you file for your patent more than a year after first offering the invention for sale. Such a loss is triply painful; first there is the direct loss of your rights, second, the loss comes after you have gone through the cost of prosecuting the patent, and third, the loss is easily avoided by reasonable diligence and by bringing in resources like TechRoadmap early on in the product development cycle. Feel free to share this newsletter (see copyright notice below) and to provide feedback by e-mail to: bruceahz@techroadmap.com Mass High Tech (click picture, article will open in new browser window):
Come on folks, how many times do we have to warn you! A few months ago (TechRoadmap Directions, Issue 1) we discussed a patent case in which the patent holder had to defend itself against the claim that it had failed to file for its patent within the 1 year on-sale statutory bar. In that case it seemed as if the patent holder was going to prevail with his argument that the delivered system was being tested and evaluated under the real-world usage that only the customer could supply, thus skirting the 1 year bar. Although this patent holder will probably hold on to his patent rights, he has had to pay extra to defend them. In this month's case we examine some real pain - a case in which the patent holder loses his rights and the costs of filing and defending the patent, all because he did not file in timely manner. The case involves a method for inspecting leads on integrated circuits. Robotic Vision Systems developed the method in the early 90's and filed a for a patent on June 24, 1992. Once granted the patent, Robotic immediately sued View Engineering and General Scanning for infringement. View defended itself by filing a motion for a summary judgment that the patent was invalid because Robotic's system had been on-sale starting in March of 1991 (that is, for more than a year before Robotic's filing date). The case is particularly interesting because it raises the question of what might happen if you sell vaporware (or at least not-yet-completed products). Although Robotic conceded that it had sold the invention to Intel in March of 1991 (i.e., 3 months prior to the critical date of June 24, 1991), it tried to appeal the finding of invalidity on at least two grounds. First, one of the inventors, it claimed, was skeptical "as to whether the invention would work for its intended purpose" on that date, so the invention was not ready for filing. Second, Robotic claimed, the invention was not ready for filing in March because the software that embodied the invention had not been written yet. The court reject both these appeals; to the first, it found that "It will be a rare case indeed in which an inventor has no uncertainty concerning the workability of his invention before he has reduced it to practice". More interestingly, in addressing the second point the court found that the inventor's internal disclosure (in March or April of 91) to a co-worker who was going to write the software was a disclosure "that was sufficiently specific to enable [a person skilled in the art] to practice the invention" and thus demonstrated that the invention was indeed ready for filing. Robotic's hesitancy about filing its patent until the invention had been reduced to practice, while at the same time trying to meet their customers' needs as early as possible, left them without the protection on which they had planned. Robotic's quandary is understandable, particularly when we learn that the rules of the game were changed retroactively. Nobody wants to put in the effort to create a patent application that ends up being abandoned or totally re-written. But the patent laws and the courts have spoken; you can only have a one year free ride. Without a the on-sale bar, a company could retroactively trap competitors who copied what seemed to be a public domain concept. While there would be no penalty for these competitors, they would have to abandon their investments in the suddenly-protected products or processes. So how do you avoid this pain?
Nothing in the preceding article should be construed as legal advice. TechRoadmap Inc serves as an interface between companies and their legal counsel. Interesting
Patent Case Robotic Vision Systems, Inc. appealed the decision of the United States District Court for the Central District of California holding claim 1 of United States Patent 5,463,227 invalid under the on-sale provision. Because the district court did not err in holding the claim invalid on the ground of the on-sale bar, the Appeals Court affirmed. BACKGROUND Robotic is the assignee of the ’227 patent, which discloses a method of scanning the leads on integrated circuit devices that are arranged in rows and columns on a multi-pocketed tray. Unlike prior art systems, which scanned all four sides of one device before moving on to the next device, the claimed method involves scanning across the entire tray, over the corresponding sides of the devices, either by row or by column. According to the specification, this “full-tray scanning” or “column and row” method reduces the overall scanning time by minimizing the number of direction and speed changes that are required. The application for the ’227 patent was filed on June 24, 1992, thus establishing a critical date of June 24, 1991 for the purposes of the on-sale provision. On October 31, 1995, the date the patent issued, Robotic filed suit against View, alleging that some of View’s three-dimensional scanning machines infringed the patent. View filed, and the district court granted, a motion for summary judgment of invalidity, concluding that the claimed invention was on sale prior to the critical date. On appeal, the Appeals Court remanded the case for further fact-finding on the sole issue whether the requisite software for Robotic’s full-tray scanning method was completed before the critical date. The Appeals Court explained that, because such software was necessary to carry out the claimed method, there was a genuine issue of material fact as to whether the claimed method was “substantially complete” before the critical date. However, while this case was on remand, the Supreme Court held (“Pfaff”) that the on-sale bar applies when the patented invention is both the subject of a commercial offer for sale and “ready for patenting” prior to the critical date (supplanting the “substantially complete” standard applied by the Appeals Court). The district court found that Robotic’s patented method was the subject of a commercial offer for sale prior to the critical date. Accordingly, the district court proceeded to determine whether Robotic’s column and row software was “ready for patenting” prior to June 24, 1991. Following a bench trial, the district court concluded that the required software was ready for patenting: (a) Prior to February 8, 1991, when Robotic personnel described the full-tray scanning method and presented explanatory drawings or “sketches” to Daryl Lafferty, a representative of Intel Corporation, the purchaser of Robotic’s patented technology. Alternatively (b) Sometime between March and April of 1991, when William Yonescu, a co-inventor, explained the invention to Daniel Briceno, a Robotic employee, in a manner sufficiently specific to enable a person skilled in the art to understand, and write the software code for, the full-tray scanning method. Applying the Pfaff test, the court rejected Robotic’s argument that the claimed method could not be ready for patenting because one of the inventors expressed skepticism as to whether the invention would work for its intended purpose. Finally, (c) the court determined that the invention was reduced to practice by May 22, 1991, at which time Robotic’s software contained sufficient code to enable its machines to perform the claimed “column and row” method. Robotic appealed to the Appeals Court. DISCUSSION Robotic argued that claim 1 is not invalid under the on-sale bar because the software needed to implement the claimed method, which involves the collection of three-dimensional data, was not ready for patenting prior to the critical date of June 24, 1991. Robotic contended that there was no enabling disclosure of the claimed invention prior to the critical date. Robotic also contended that the invention was not reduced to practice before the critical date. The Appeals Court agreed with View that claim 1 is invalid for violation of the on-sale bar. Under the two-part test set forth by the Supreme Court, the on-sale bar applies when an invention is: (1) the subject of a commercial offer for sale before the critical date; and (2) ready for patenting before the critical date. An invention may be shown to be ready for patenting in at least two ways: “by proof of reduction to practice before the critical date; or by proof that prior to the critical date the inventor had prepared drawings or other descriptions of the invention that were sufficiently specific to enable a person skilled in the art to practice the invention.” The district court determined that Robotic had sold its patented full-tray scanning technology to Intel Corporation in March 1991, more than one year prior to the filing date of the ’227 patent. Accordingly, the sole issue in this appeal is whether the district court’s finding that the claimed invention was ready for patenting prior to the critical date was clearly erroneous. The Appeals Court agreed with View that the claimed invention, including the necessary software for implementing the full-tray scanning method, was ready for patenting prior to the critical date. Sometime between March and April of 1991, William Yonescu, a co-inventor of the full-tray scanning method, explained the invention to Daniel Briceno of Robotic and asked him to write the software for full-tray scanning. This explanation was sufficiently specific for Briceno to understand the invention and to write the software needed to implement the method. Regardless whether or not the software was reduced to practice prior to the critical date, it is undisputed that Briceno ultimately completed the software program pursuant to Yonescu’s description of the invention. In Pfaff, the Supreme Court, based on the facts of that case, referred to “drawings or other descriptions” as proof that an invention is complete, and hence ready for patenting. In this case, the proof was disclosure to Briceno. Accordingly, because Yonescu’s disclosure was sufficiently specific to enable Briceno, a person skilled in the art, to practice the invention, the district court did not err in concluding that the invention was ready for patenting before the critical date. Robotic argued that its invention was not ready for patenting before the critical date because “…software to implement the claimed method did not exist.” That argument was not persuasive. As explained above, whether or not the software needed to implement the claimed method existed at the time of the disclosure is irrelevant, provided that the disclosure of the invention was made prior to the critical date and was sufficiently specific to enable a person skilled in the art to practice the invention. Robotic contended that Yonescu’s disclosure to Briceno was not a disclosure of the claimed invention, as it demonstrated that more work was needed to determine whether the invention would work for its intended purpose. The Appeals Court disagreed. Prior to Pfaff, the Appeals Court explained that: “[A] sale or a definite offer to sell a substantially completed invention, with reason to expect that it would work for its intended purpose upon completion, suffices to generate a statutory bar.” However, in Pfaff, the Supreme Court supplanted the “substantially completed” standard applied by that court. The rules have thus changed [Appeals Courts words]. The Supreme Court interpreted the term “invention” as requiring a complete conception. Notably absent from this test is a requirement that an inventor have complete confidence that his invention work will work for its intended purpose. Such confidence often must await a reduction to practice, which is a separate basis on which an invention may be shown to be ready for patenting. IP
Links |
|
|
| Copyright © 2001 TechRoadmap Inc. All rights reserved. This newsletter, or portions thereof, may be copied and distributed, so long as this is not done for profit, proper acknowledgement of the source is made, and this copyright notice is included. If you wish to be removed from this mailing list, please simply reply to this message with the word REMOVE in the subject line. | ||
