Protecting Patent Clients in Alice's Wonderland

The U.S. Supreme Court ruled in Alice Corp. v. CLS Bank that laws of nature, natural phenomena and abstract ideas are not patentable. Using Alice, Holland & Knight's Intellectual Property Group has won several patent-infringement cases for clients. The attorneys challenged the patents at the outset, saving clients from costly discovery and prolonged litigation.
Protecting Patent Clients in Alice's Wonderland

The U.S. Supreme Court's June 2014 decision in Alice Corp. v. CLS Bank triggered a sea change in patent protections and opened the floodgates for challenges under Section 101 of the Patent Act. This paved the way for a new era in patent infringement defense, with hundreds of patents being declared invalid.

Using Alice, Holland & Knight's Intellectual Property Group achieved several notable patent victories for clients. As defendants, the attorneys challenged the patents as abstract ideas at the outset of the cases, saving clients from costly discovery and prolonged litigation.

Section 101 defines patent-eligible subject matter as "any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof." In Alice, however, the justices ruled that laws of nature, natural phenomena or abstract ideas cannot be patented.

The Alice court affirmed the general framework for determining what constitutes an unpatentable abstract idea, but left the task of hammering out the specifics to the lower courts. As such, the Alice ruling has resulted in a flurry of court opinions that attempt to define the precise boundaries of patentable subject matter.

In developing their motions, Holland & Knight's teams provided step-by-step analyses of why the purported inventions are patent-ineligible, refuting any possible arguments and allowing the courts to make quick and efficient decisions. They applied the two-part test, which was established in Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1293 (2012) and further enhanced by Alice.

First, a court must determine if a relevant claim falls under "one of those patent-ineligible concepts," such as a law of nature, natural phenomenon or an abstract idea. If so, then the court moves on to the second part. For this, the court must decide whether an "inventive concept" exists. Under Alice, the Supreme Court established that this must include more than the well-understood, routine, conventional activity previously engaged in by researchers.

Pharmaceutical Patents: Actavis Inc.

When Actavis Inc. found itself the defendant in a patent infringement case over an analgesic, it called on Holland & Knight to defend it.

Our intellectual property attorneys developed a breakdown of why the claimed method of treatment, which included lowering the dosage for patients with impaired kidney function, was unpatentable in presenting their motion to dismiss. The rival drug maker conceded from the onset the first part of the test, but contended that its invention was "a novel and useful application of that discovery." However, our experienced litigators successfully argued that the claimed method was nothing more than the known use of an old drug that is "widely used" for relief of pain. Chief Magistrate Judge Mary Pat Thynge agreed, and recommended granting our motion to dismiss for lack of patentable subject matter. District Judge Richard G. Andrews adopted Her Honor's recommendation and granted the motion.

Technology Patents: Polar Electro Oy

Holland & Knight led the charge for client Polar Electro Oy in its victory against an exercise equipment maker. The manufacturer alleged that certain Polar heart rate products infringed its asserted patent by receiving information about a person's heart rate, evaluating the heart rate and providing feedback to the person based upon the evaluation.

On behalf of Polar, the attorneys filed a motion for judgment on the pleadings, arguing that the asserted patent was invalid for claiming only abstract ideas. The federal court granted the motion and concluded that the asserted patent was invalid and claimed nothing more than the idea of receiving feedback based on data from a subject. Invalidating the patent at the early pleadings stage saved Polar from protracted and expensive litigation.

The manufacturer appealed the district court's decision, but the Holland & Knight team convinced the Court of Appeals for the Federal Circuit that the district court got the decision correct. The appellate court summarily affirmed Polar's win only a day after the court heard argument.

Product Patents: Hasbro Inc. and Arachnid 360 LLC

The Intellectual Property Group won a motion to dismiss on behalf of client Hasbro Inc. The lawsuit alleged that Hasbro's fuzzy, animatronic Furby dolls infringed five patents.

The attorneys argued that the claims were unpatentable under Alice because they were directed to "the abstract idea of devices or toys that communicate by and respond to signals sent over the air." The court agreed, characterizing the claims as directed toward "toys that communicate or interact amongst one another, with humans, or with computers" and "the abstract process of communication itself." As a result, the court invalidated all five of the patents and granted Hasbro's motion to dismiss, which the Court of Appeals for the Federal Circuit summarily affirmed. The decision is likely to serve as a touchstone for future interpretations of the Alice opinion.

Holland & Knight also won a motion to dismiss on behalf of Arachnid 360 against its competitor Gaelco. Gaelco alleged that Arachnid's Galaxy dart machines infringed its U.S. patent, which covers a system that allows a referee to review video from a darts match to determine whether a player has violated a rule. However, Mr. Anthony Fuga argued before both the N.D. Illinois and the U.S. Court of Appeals for the Federal Circuit that the Gaelco patent-at-issue was directed to the abstract idea of refereeing and, furthermore, Gaelco acknowledged there is no new technology involved in its patent. Both the district court and the Federal Circuit agreed, and invalidated Gaelco's patent.

Shipping Software Patents: Maher Terminals LLC

Relying upon Section 101, our patent litigation attorneys were able to sink a lawsuit at the motion to dismiss stage. The plaintiff alleged Maher Terminals LLC was infringing multiple shipping software patents through its terminal operating systems, which monitor the locations and load statuses of shipping containers.

The plaintiff argued that those systems read on its patented technology to track containers based on movements, location, and load status in a shipyard. Our attorneys, however, convinced both the district court and the Federal Circuit that the technology was unpatentable because it claimed the abstract idea of monitoring the location and load status of containers in a yard. The district court granted the motion to dismiss and the Federal Circuit affirmed the dismissal.

Holland & Knight's Intellectual Property Group

Holland & Knight's representation in Section 101 disputes demonstrates the strength of its intellectual property lawyers. The team is highly experienced in avoiding costly litigation by quickly winning motions to dismiss, saving clients time and money as well as keeping their products in the online marketplace and on store shelves.

Our global network of attorneys offers a broad array of legal services to safeguard assets, including patent litigation; patent, trademark, copyright and trade secret protection; as well as licensing agreements. The Intellectual Property Group has extensive experience protecting client interests before the United States Patent and Trademark Office (USPTO) and in the various courts and tribunals throughout the world. The team of technically savvy attorneys includes trial lawyers who understand that each case presents its own business dynamics and client objectives.

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