Anticipate This!™ | Patent and Trademark Law Blog

Patentable Tax Strategies?

Posted in General Commentary by Jake Ward on July 31, 2006

According to this article in Business Week, there are presently 41 business method patents related to tax strategies, and 61 applications pending. In particular, the article briefly describes that John Rowe, executive chairman at Aetna, was sued in U.S. District Court in New Haven for patent infringement by Wealth Transfer Group, a firm that obtained a patent on grantor retained annuity trusts (GRATs) as a means of achieving substantial gift-tax savings.  The article further recommends strategies, e.g. written assurance and indemnity agreements, for protecting oneself from liability over creative tax-saving methods.

Although the article does not provide any in-depth analysis, I believe it does well in highlighting the concerns of allowing patents on business methods . . . and was a thought-provoking light read.  I recommend taking a look if you have a few minutes to spare.

They Invented What? (No. 9)

Posted in They Invented What? by Jake Ward on July 19, 2006

U.S. Pat. No. 6,055,910:  Toy gas fired missile and launcher assembly.

toyrocket 

Background:

Flatulence is the accumulation of excessive gas in the stomach or intestine. Because flatulence may be socially embarrassing, it is one of the most common complaints encountered in medical practice. Although a number of factors have been implicated in its pathogenesis, sometimes no cause can be found and it may therefore prove refractory to treatment. Thus, serious discussions of flatulence have led to little more than home remedies, largely empirically derived. Only in the last three decades has there emerged a science of flatology  . . . .

A recreational activity practiced by some individuals is ignition of one’s own flatus. This is performed by using a lit match or candle, or a cigarette lighter. So widespread is this activity that there are web sites on the Internet devoted exclusively to explaining proper lighting techniques.

A major drawback of this popular practice is that it usually involves the hazardous coupling of fire, combustible gases and inebriated participants. Reports of serious burns to body parts are not uncommon, this being especially true when the participants remove their clothing . . . .

In view of the foregoing, the main object of this invention is to provide a safe toy which exploits the combustible properties of flatus to fire a toy missile into space.  

Claims: 

We claim:

1. A toy gas-fired missile and launcher assembly for use by a human operator comprising:

          A. a missile composed of a head and a piston extending axially from the head;

          B. a barrel for launching the missile whose piston is telescoped in the barrel, a negative pressure being produced when the piston is pulled out, said barrel having a closed end in which is mounted an electrically-activatable ignitor, a combustion chamber being defined between said closed end of the barrel and an end of the piston when it is fully inserted in the barrel;

          C. Means to feed a combustible gas mixture into said chamber, including an intake tube communicating with said chamber and having a normally-closed valve and an inlet to the tube, the inlet of the intake tube being placeable adjacent an anal region of the operator from which colonic gas is emitted whereby when the piston is pulled out the resultant negative pressure acts to inhale the colonic gas into said chamber to produce the combustible gas mixture; and

          D. means to apply an activating voltage to said ignitor to explode said mixture, thereby launching the missile.

2. An assembly as set forth in claim 1, in which the piston is cylindrical and is received in the barrel which is cylindrical.

3. An assembly as set forth in claim 1, in which said head is formed by a ball of flexible open-cell foam plastic material.

4. An assembly as set forth in claim 2, in which the foam plastic is urethane.

5. An assembly as set forth in claim 1, in which said ignitor is a glowplug.

6. An assembly as set forth in claim 5, in which said means to apply said voltage includes a casing mounted behind the end wall of the barrel and containing batteries and a switch mounted on the casing which when closed connects the batteries to the ignitor.

7. An assembly as set forth in claim 1, in which the intake tube is joined to the barrel and extends laterally therefrom.

8. An assembly as set forth in claim 7, in which the intake tube is hinged to the barrel and when not in use lies against the barrel.

9. An assembly as set forth in claim 1, in which intake tube is surrounded by a handle.

KSR International Co. v. Teleflex, Inc., et al. – The Petition for Certiorari

Posted in Opinion Commentary by Jake Ward on July 16, 2006

The full petition may be viewed here: KSR – Petition for Certiorari

The reasons stated by KSR as to why the Supreme Court should grant certiorari for this case are summarized as follows:

1.  The Federal Circuit has Departed from the Supreme Court’s Precedents Construing Section 103.

          KSR asserted that in the six cases in which the Supreme Court has applied 103, in none of the cases did the court hold that a “teaching, suggestion, or motivation” to combine or modify references was necessary.  KSR proceeded to cite these cases, including Graham v. John Deere, pointing out that the Supreme Court never required any “specific factual findings” of a teaching, suggestion, or motivation to combine.  In fact, as recited in Anderson’s-Black Rock, Inc. and Sakraida, the court stated that “where a patent merely covers a combination of old elements, the patent will not be valid unless the combination produces “a new or different function” or demonstrates a “synergistic result” or “a result greater than the sum of the several effects taken separately.”

          KSR also noted that prior to the creation of the Federal Circuit, at least seven regional Courts of Appeals followed Sakraida and Anderson’s-Black Rock, et seq.  Further, this precedent was rejected by the Federal Circuit in Stratoflex, Inc. v. Aeroquip Corp., which provided that there was no legal basis for the judicial classification of “combination patents”, and subsequently fashioned the present “teaching, suggestion, motivation” test.

          Numerous commentators and authors have since noted the divergence between the Federal Circuit’s precedents and prior Supreme Court decisions.  In particular, it has been noted that the patent in Graham v. John Deere, arguably the premier Supreme Court case relating to obviousness, was held invalid without the detailed evidentiary showing that the Federal Circuit currently requires before deeming subject matter unpatentable under 103.

2.  There is an Acknowledged Circuit Split in the Test for Determining Obviousness.

         KSR asserted that the Federal Circuit has already acknowledged that the “teaching, suggestion, motivation” test conflicts with at least one other circuit, the Fifth Circuit, which has required a “synergistic result” as drawn from Supreme Court precedent.  “Rather, the Federal Circuit makes patentabilty depend on the outcome of costly and unpredictable litigation over the existence or non-existence of some “teaching, suggestion, or motivation” to combine pre-existing elements, regardless of whether the combination yields any new or different function or effect.”  KSR is undoubtedly correct in asserting that “the issue here is relevant to all patents.”

3.  National Studies Have Identified the Federal Circuit’s Obviousness Precedents as needing Reform.

          The Federal Trade Commission (FTC) release in 2003 a comprehensive study of the patent system, entitled: To Promote Innovation:  The Proper Balance of Competetion and Patent Law and Policy. KSR asserted that the FTC recognized the Federal Circuit’s obviousness test as a core issue in assessing nonobviousness and a focal point of current patent debate. 

          Additionally, in 2004 the Nationa lReeseach Council of the Natioanl Academies of Science and Engineering release a report calling for various reforms of the current patent system.  See A Patent System for the 21st Century (2004).  KSR asserted that the second recommendation of this report was to “reinvigorate the non-obviousness standard.”  The report cited the work of a number of legal scholars whom consider the present state of the evolution of patent law as requiring a reduced hurdle for non-obviousness, particularly with respect to business method patents.

4.  KSR v. Teleflex is a Good Case for the Supreme Court to Review the Federal Circuit’s Obviousness Test.

          Why?  Well first, the Federal Circuit’s obviousness test is at least two decades old . . . and the issue is considered so settled that the Federal Circuit did not even publish the decision vacating judgment in this case.  Secondly, the challenge to the validity of the patent claim at issue is substantial.  Thirdly, the technology at issue is readily understood (gas pedals for automobiles).  Fourthly, the facts of the case well illustrate how the present test severely weakens 103 and ignores  the effect of exogenous changes, i.e. changes no attributable to the work of an inventor that can be commercially successful yet technologically trivial.  Finally, throughout the case KSR has relied upon Supreme Court precedent with regard to “combination patents” and the case therefore provides the court with a clear opportunity to address the issue.

They Invented What? (No. 8)

Posted in They Invented What? by Jake Ward on July 12, 2006

U.S. Pat. No. 6,982,161:  Process for the utilization of ruminant animal methane emissions.

gascollector 

I claim: 

1. A method for producing methane-utilizing microorganisms in a confined apparatus comprising using the methane exhaled through ruminant animal exhalation as a source of carbon and/or energy for the growth of said microorganisms, comprising:
    a. collecting methane gas that has been exhaled through ruminant animal exhalation,
    b. providing methane-utilizing microorganisms which can use said methane as a source of carbon and/or energy for growth,
    c. providing a growth-culture medium which promotes the growth of said microorganisms, including a nutrient substrate and/or a microorganism immobilization means,
    d. providing a means for the directed mutual-exposure of said methane, said microorganisms, and said growth-culture medium, including a means for the capture and conveyance of said methane and a means for confining said microorganisms, said growth-culture medium, and said methane to a specified apparatus existing outside of the digestive tract of a ruminant animal,
    e. mutually-exposing said methane, said microorganisms, and said growth-culture medium to cause said microorganisms to grow in said apparatus using said methane and said growth-culture medium,
whereby said methane contained within said ruminant animal exhalation is utilized for the sustained growth of said microorganisms in a specified apparatus,
whereby said methane, an environmentally-destructive material and previously unusable source of energy, is used to produce a useful end-product, and
whereby said microorganisms can be harvested and utilized following growth, adding economic incentive to a ruminant animal methane emissions reduction effort.

(more…)

Teleflex, Inc., et al. v. KSR International Co.

Posted in Opinion Commentary by Jake Ward on July 8, 2006

The District Court Misapplied the “Teaching-Suggestion-Motivation” Test for Obviousness.

(Fed. Cir. 2005, 04-1152), non-precedential

The CAFC vacated a summary judgment of invalidity by the district court (ED Mich.) in favor of Teleflex.  In particular, the court found that the district court applied an incomplete teaching-suggestion-motivation test in finding Teleflex’s U.S. Pat. No. 6,237,565 (the ‘565 patent) obvious. 

Teleflex originally sued KSR and alleged that KSR’s pedal assembly infringed the ‘565 patent.  KSR defended on the basis that Claim 4 of ‘565 was obvious and invalid. 

The technology recited by the Teleflex ‘565 patent involves an adjustable gas pedal assembly pivotally mounted on a support bracket, with an electronic throttle control (or electronic control) being attached to the support for signaling the relative position of the gas pedal.  The objective of the patent was “to design a smaller, less complex, and less expensive electronic pedal assembly.” 

The district court’s finding of obviousness was based on the combination of the Asano patent (pedal assembly without the electronic control) with either 1.) the Rixon patent (assembly with sensor located in the pedal housing,  and suffering from the problem addressed by the ‘565 patent); 2.) the Smith patent (electronic control on the support bracket of a pedal assembly, and directed to a different problem than that addressed by the ‘565 patent); or 3.) the Redding patent (assembly with a non-constant pedal pivot during adjustment, and cited by the Examiner in combination with the Smith patent during prosecution).

The CAFC held that the Asano patent does not address the same problem as the ‘565 patent, and therefore one of ordinary skill would not be led to combine Asano with the other patents in the particular manner claimed.  In addition, the Rixon patent suffers from the same problem addressed by the ‘565 patent, but suffering from the problem “fails to provide a sufficient motivation to combine.”  Further, the Smith patent is directed to the problem of wire chafing, a problem different from that of the ‘565 patent, and also is not related to an adjustable pedal assembly.  A person of ordinary skill is led to combine prior art teachings when the references address the precise problem that the patentee was trying to solve.  Finally, with respect to the Redding patent, the CAFC held that “the court’s task is not to speculate as to what an examiner might have done if confronted with a piece of prior art” but to “make an independent obviousness determination.”  Speculation as to what the Examiner would have done if confronted with a different reference is not relevant to the court’s determination of obviousness.

In sum, the district court misapplied the teaching-suggestion-motivation test and a general issue of material fact existed as to whether a person of ordinary skill in the art would have been motivated to attach an electronic control to the support structure of the Asano pedal assembly.

A Supreme Issue of Obviousness.

Posted in General Commentary by Jake Ward on July 8, 2006

With the recent granting of a petition for a writ of certiorari to the Supreme Court in KSR v. Teleflex, the issue of what constitutes obviousness under 35 U.S.C. § 103 is again, for better or worse, in the hands of our nation’s highest court.

Accordingly, I plan to dedicate the next few posts to the background surrounding KSR v. Teleflex and the question presented before the court, namely:

“Whether the Federal Circuit has erred in holding that a claimed invention cannot be held ‘obvious’ . . . in the absence of some proven ‘teaching, suggestion, or motivation’ that would have led a person of ordinary skill in the art to combine the relevant prior art teachings in the manner claimed?”

They Invented What? (No. 7)

Posted in They Invented What? by Jake Ward on July 5, 2006

U.S. Pat. No. 4,465,208:  Chewing Gum Dispenser.

  gum

Background:

“While difficulty in removing the gum from the sheath occurs initially, and while subsequentially having to deal with loosened sticks of gum may not be a pressing problem, it can, however, be a nuisance, and even dangerous. It can be dangerous, for example, if the habitual gum chewer attempts to provide himself with a stick of gum while driving an automobile. The need to use two hands to remove the initial sticks of gum from the sheath, or the need to look away from the road in an effort to locate a loosed stick, can have serious consequences.”

Claims: 

We claim:

1. A dispenser for dispensing sticks of chewing gum, which sticks have a given thickness, one at a time, comprising, in combination:

a container having a bottom wall, two side walls, two end walls, and a top wall, and having size to receive a plurality of sticks of chewing gum arranged contigiously in a stack such that the sticks lie substantially parallel to one another and to said top and bottom walls of said container;

a plate disposed within said container substantially parallel with said top and bottom walls;

means in the form of a resilient element for urging said plate and any stack of gum sticks disposed thereon toward the underside of said top wall;

the top wall being formed by a first portion and second portion; said second portion of said top wall being adjacent to one end wall and extending from one of said two side walls to the other; said first portion is retractable in the plane of said top wall in the direction away from said second portion;

said first portion of said top wall having an opening formed therethrough which opening is elongated along the centerline of said top wall in the direction of the ends of said containers;

said one end wall having an outlet opening formed therethrough which is rectangular in shape and extends in width from one side wall to the other side wall of said container, and extends in height from an upper edge which lies a distance less than the height of said outlet opening below the plane of the underside of said top wall to a lower edge which is greater than said thickness of a stick of chewing gum but less than twice said thickness.

Wishing You a Safe and Happy Fourth of July!

Posted in General Commentary by Jake Ward on July 4, 2006

U.S. Pat. No. D473503:  Transparent United States Flag License Plate Cover.

 starsandstripes

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