Monthly Archives: November 2013

Using Copyrighted Articles in Patent Prosecution Deemed Fair Use

In a battle of intellectual property lawyers, U.S. Magistrate Judge Jeffrey Keyes recently sided with the patent attorneys. He ruled that a law firm’s use of copyrighted scientific journal articles in prosecuting patent applications constituted fair use.

The Facts of the Case

American Institute of Physics v. Schwegman Lundberg & Woessnerinvolved science and technology articles published by Plaintiffs American Institute of Physics and John Wiley & Sons, Inc. The law firm of Schwegman Lundberg & Woessner (Schwegman) obtained and later copied eighteen of the Plaintiffs’ copyrighted journal articles for use in its patent prosecution practice. The Plaintiffs allege that by obtaining the copies without paying for a license, and by making internal copies within the law office, Schwegman committed copyright infringement. The Plaintiff agreed submitting copies to the Patent Office was permissible. Both Schwegman and the USPTO maintain that Schwegman’s copying of the articles for their files and review constitutes a non-infringing “fair use.”  The publishers disagreed.

The Court’s Decision

In holding that fair use applied, the court applied the fair use provisions of the copyright statute which requires the courts to consider the following factors in deciding this issue:

  • The purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
  • The nature of the copyrighted work;
  • The amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
  • The effect of the use upon the potential market for or value of the copyrighted work.

In this case, the court determined that all four fair use factors weighed in favor of finding that Schwegman’s use is fair as a matter of law. As explained by Magistrate Keyes:

The record demonstrates no genuine dispute that Schwegman’s use of the Articles was new and different and did not merely supersede the original purpose of the Articles. Also, the undisputed facts demonstrate that the nature of the Articles is predominantly informational. Further, although Schwegman did make complete copies of the Articles in its patent prosecution practice, the only reasonable inference to draw from the record is that Schwegman’s copying of the Articles was consistent with the new and different purpose and character of Schwegman’s use. And there is no evidence to suggest that Schwegman’s copying impacted a traditional, reasonable, or likely to be developed market for the Articles.

The decision is good news for fair use advocates and patent lawyers, but it must still be affirmed by the district court.

At Sheldon Mak & Anderson, we recognize that innovation is your competitive edge – and it needs protection. Recognized as one of the country’s “Best Law Firms” by U.S. News and Best Lawyers, our attorneys possess more than two decades of experience. Our full-service IP firm provides local, regional, national, and international legal services in the following areas: patents, trademarks, copyrights, trade secrets, IP litigation, international patent and trademark prosecution, licensing, alternative dispute resolution, and green technology.

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Department of Commerce Issues Report on Copyright Policy in the Digital Age

As Congress continues to hear testimony regarding potential changes to the U.S. copyright system, the Department of Commerce recently issued a green paper on Copyright Policy, Creativity, and Innovation in the Digital Economy. It addresses striking the proper balance between the rights of copyright holders and the innovative power of the Internet and the free flow of information.

“Ensuring that our copyright policy provides incentives for creativity while promoting innovation on the Internet is a critical and challenging task. The Green Paper released today is an important step toward ensuring that the United States’ creative industries continue to have a substantial impact on strengthening our nation’s economy,” said U.S. Secretary of Commerce Penny Pritzker.

The green paper was prepared by the Department of Commerce’s Internet Policy Task Force (IPTF) with input from the U.S. Patent and Trademark Office (USPTO) and the National Telecommunications and Information Administration (NTIA). According to the USPTO, it is the most thorough and comprehensive analysis of digital copyright policy issued by any administration since 1995.

The report includes recommendations to establish a stakeholder dialogue on improving the operation of the notice and takedown system under the Digital Millennium Copyright Act (DMCA) as well as proposals to solicit public comments and convene roundtables on:

  • The legal framework for the creation of remixes;
  • The relevance and scope of the first sale doctrine in the digital environment;
  • The application of statutory damages in the context of individual file-sharers and secondary liability for large-scale online infringement;
  • The appropriate role for the government, if any, to help improve the online licensing environment, including access to comprehensive public and private databases of rights information.

If you need any help with Intellectual Property issues, from filing a patent, trademark or copyright, or just need advice regarding how best to protect your inventions, ideas or your brand, please contact me at 1-855-UR IDEAS (1-855-874-3327). Stay up-to-date on the latest Intellectual Property Law news from Sheldon Mak & Anderson.

Success Under the AIA’s “First to File” System Requires Strategy Shift

Navigating the numerous changes under the America Invents Act (AIA) can be challenging. One of the most significant changes — the adoption to a first to file system — requires inventors to more carefully consider the timing of patent applications.

To take full advantage of the new regime, companies should be prepared to file “early and often.”

Under the AIA, a patent application will be denied based on prior art if “the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.” The provision expands the activities and publications that are considered to be “prior art” to patent applications.

Nonetheless, there are several key exceptions. For instance, if the inventor or another who obtained the subject matter from the inventor makes the disclosure, it is not considered prior art. In addition, disclosures made by a third party for subject matter that had been previously publicly disclosed by the inventor also fall under the exception. To qualify under the one-year grace period, these disclosures must be made within one year prior to filing a patent application.  The scope of these exceptions remains to be determined.  What if the invention was on sale privately but not “available to the public?”  Does that start the one year clock?

In light of the changes, it is advantageous to file a provisional patent application as soon as practically possible. These patent applications are relatively low cost and require far less documentation that a standard, non-provisional patent application.

After the initial filing, inventors should file additional provisional patent applications that reflect improvements to the invention in the form of additional patentable subject matter. So long as a non-provisional patent application is filed within one year, the disclosures can be combined into a single filing.

In summary, filing early and often is the best way to prevent headaches down the road, including subsequent and intervening disclosures.

If you need any help with Intellectual Property issues, from filing a patent, trademark or copyright, or just need advice regarding how best to protect your inventions, ideas or your brand, please contact me at 1-855-UR IDEAS (1-855-874-3327). Stay up-to-date on the latest Intellectual Property Law news from Sheldon Mak & Anderson.

Copyright Holders Call on Congress for Stronger Protection

In the first of several hearings regarding the future of the U.S. copyright system, content creators argued for stronger protections before the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet. The hearing featured testimony from representatives of the Copyright Alliance, Getty Images Inc., the American Society of Media Photographers, Yep Roc Records and Redeye Distribution Inc., and 3-D moviemaker Stereo D LLC

As we have previously discussed on this IP Law Blog, Congress recently embarked on a broad review of U.S. copyright laws with the goal of updating the country’s copyright protection scheme. With the exception of the Digital Millennium Copyright Act, most other portions of the Copyright Act date back to 1976.

In their testimony before the committee, copyright holders argued that strong protection is needed to combat infringement in the digital age, particularly online piracy.

“Our goal in reviewing licensure laws should be to protect creativity and still allow for an active and intelligent marketplace for searching and licensing creative works,” John Lapham, senior vice president and general counsel of Getty Images, testified. “When we do so we can all benefit from content that moves, inspires, provokes, educates, and encourages.”

Representatives from the music and film industries expressed concerns about file sharing and other forms of piracy. “If an environment exists that does not provide adequate copyright protection and blockbuster films become unaffordable and unprofitable due to the threat of piracy, this new and thriving 3-D industry will be significantly hampered and severely impacted,” said William Sherak, Stereo D’s president. “The reason being that 3-D conversions are normally undertaken on major blockbuster films—the very films that are often the greatest targets of piracy.”

At Sheldon Mak & Anderson, we recognize that innovation is your competitive edge – and it needs protection. Recognized as one of the country’s “Best Law Firms” by U.S. News and Best Lawyers, our attorneys possess more than two decades of experience. Our full-service IP firm provides local, regional, national, and international legal services in the following areas: patents, trademarks, copyrights, trade secrets, IP litigation, international patent and trademark prosecution, licensing, alternative dispute resolution, and green technology.

Federal Circuit Patent Decision Highlights Inventors Must Be Mindful of On-Sale Bar

Companies must contend with a number of deadlines when seeking patent protection. Under the law prior to the America Invents Act, an inventor had to file a patent application within one year of publicly disclosing or selling the invention. The rule is commonly referred to as the “patent on-sale bar.”

In a recent case before the U.S. Court of Appeals for the Federal Circuit, the court shed light on the applicability of the on-sale bar. In a split decision, the panel invalidated Hamilton Beach Brands Inc.’s slow cooker patent because its foreign supplier offered to manufacture the product more than a year before the patent application was filed.

The Facts of the Case

 In Hamilton Beach Brands, Inc. v. Sunbeam Products, Inc., Sunbeam Products, Inc. defended a patent infringement action by Hamilton Beach Brands, Inc. by asserting that Hamilton Beach offered for sale and publicly used the Stay or Go® slow cooker, the commercial embodiment of the patent at issue, more than one year prior to the earliest possible filing date.

The on-sale bar applies when two conditions are satisfied before the critical date: (1) the claimed invention must be the subject of a commercial offer for sale; and (2) the invention must be ready for patenting. This case focused on the first requirement.

Hamilton Beach issued a purchase order to its supplier for manufacture of 2,000 units of its Stay or Go® slow cookers. Hamilton Beach listed on the purchase order its facility in Tennessee as the shipping address and its office in Virginia as the billing address. Shortly thereafter, the supplier, via email, confirmed that it had received the purchase order and noted that it would begin production of the slow cookers as soon as it received Hamilton Beach’s release.

The Court’s Decision

The Federal Circuit ultimately concluded that Hamilton Beach’s purchase order with the foreign supplier amounted to an invalidating commercial offer for sale under the on-sale bar. As explained by the court:

 Hamilton Beach’s supplier responded prior to the critical date that it was ready to fulfill the order. In other words, the supplier made an offer to sell the slow cookers to Hamilton Beach. At that point, the commercial offer for sale was made and, under the governing corporate purchase agreement, Hamilton Beach could accept the offer when it so pleased. And, Hamilton Beach concedes, as it must, that, had it provided a “release” any time after it received that email, a binding contract would have been formed.

 As further highlighted by the court, it did not matter that the offer was made by Hamilton Beach’s own supplier and was made to Hamilton Beach itself. In addition, the court noted that a commercial offer for sale made by a foreign entity that is directed to a United States customer at its place of business in the United States is sufficient to serve as an invaliding activity.

As this decision makes clear, the on-sale bar can be fatal to an otherwise valid patent. To avoid running afoul of the statute, inventors should consult with an experienced patent attorney who can carefully evaluate what types of activities may trigger the start of the one-year deadline.  Under the current law, it is advisable to file a patent application as soon as possible.

If you need any help with Intellectual Property issues, from filing a patent, trademark or copyright, or just need advice regarding how best to protect your inventions, ideas or your brand, please contact me at 1-855-UR IDEAS (1-855-874-3327). Stay up-to-date on the latest Intellectual Property Law news from Sheldon Mak & Anderson.

New York Times Wins Patent Lawsuit Over Double Dipping

The New York Times recently won a significant patent victory in a case involving those text messages you receive on your cell phone with product updates and breaking news. A federal district judge in Chicago found that Helferich Patent Licensing LLC (HPL), the company that holds the patent for the technology, could not extract royalties from both cell phone makers and content providers.

The Facts of the Case

HPL holds a portfolio of patents that includes the methods and systems that send and receive hyperlinks to websites to a cellular phone. The user can then click on the link to view the full content on the sender’s website. HPL licenses the technology to cell phone manufacturers and content providers.

HPL filed a patent infringement lawsuit against defendants New York Times, CBS, G4 Media LLC, NBC’s Bravo Media LLC unit and JC Penny after the companies refused to enter licensing agreements. In their defense, the companies argue that the patents at issue are exhausted based on the existing agreements with cell phone manufacturers.

The Court’s Decision

U.S. District Judge John Darrah agreed, dismissing the case on summary judgment. He rejected HPL’s argument that the doctrine of patent exhaustion was inapplicable because the inventions include distinct “handset” and “content” claims.

“The doctrine of patent exhaustion is designed to avoid double recovery by a patentee, promote the orderly administration of patent rights, provide an efficient method for determining the termination of a patent monopoly, and promote fair competition,” Darrah explained. “To permit Helferich to recover multiple times on the same patent by selling licenses to the patents piece by piece (or claim by claim) is contradictory to these policies.”

At Sheldon Mak & Anderson, we recognize that innovation is your competitive edge – and it needs protection. Recognized as one of the country’s “Best Law Firms” by U.S. News and Best Lawyers, our attorneys possess more than two decades of experience. Our full-service IP firm provides local, regional, national, and international legal services in the following areas: patents, trademarks, copyrights, trade secrets, IP litigation, international patent and trademark prosecution, licensing, alternative dispute resolution, and green technology.

Copyright Lawsuit Targets YouTube Cover Songs

Videos of virtual unknowns belting out Top-40 hits are some of the most popular content on YouTube. However, a recent copyright suitcalls into question their legality.

The National Music Publishers’ Association (NMPA) alleges that Fullscreen, Inc., a multi-channel network (MCN) that produces some of YouTube’s most popular channels, has failed to obtain the proper licenses for music and lyrics featured in its YouTube content. According to the NMPA, “Fullscreen directly profits from advertising revenue generated by unlicensed music videos on their channels but does not compensate songwriters or music publishers.”

Attempts to hold Google liable for infringing content on YouTube have been largely unsuccessful, given the “safe harbor” provisions of the Digital Millennium Copyright Act. Therefore, music publishers may now be focusing their efforts on content producers. Fullscreen alone has 15,000 YouTube channels with more than 200 million subscribers and averages 36 million viewers responsible for 284 million video views per month in the United States.

The copyright suit also appears to be the result of failed negotiations between the two sides to reach a licensing agreement. In a statement announcing the lawsuit, the NMPA references an agreement with a competing MCN, Maker Studios. The settlement will reportedly “enable music publishers and their songwriting partners to be compensated for past infringement and license Maker going forward.”

If you need any help with Intellectual Property issues, from filing a patent, trademark or copyright, or just need advice regarding how best to protect your inventions, ideas or your brand, please contact me at 1-855-UR IDEAS (1-855-874-3327). Stay up-to-date on the latest Intellectual Property Law news from Sheldon Mak & Anderson.