Thursday, September 20, 2012

American Innovation: Baby Bottom Art, Snake Walkers and Rounded Edges on iPhones

Pinch & zoom, bounceback, and the cool rectangular case with rounded edges of your iPhone were some of the innovations considered by the jury when they recently awarded $1.05 Billion to Apple in its patent infringement litigation against Samsung (see this prior entreVIEW post on the topic by Lori Wiese-Parks).

This well publicized case brought back memories of my front row seat on the hard benches of a federal courtroom in Richmond Virginia in 2010 as Judge Payne and a jury decided the fate of Lawson Software, where I served as in house legal counsel. In that case, the plaintiff alleged the infringement by Lawson of patent claims that covered basic supply chain management software—the ordering of supplies through the internet. What made the case even more interesting was that the patents at issue were in reexamination by the United States Patent Office (USPTO), a process specifically established to allow the USPTO another opportunity to reconsider the validity of certain patents and if necessary to correct its mistakes.
Early results of the reexamination indicated that the patents and relevant claims at issue were likely to be invalidated. However, Judge Payne denied a motion to stay (postpone) the litigation pending the outcome of the reexamination. He also prohibited the jury from even being informed of the USPTO reexamination. The jurors deliberated without knowing that the patents at issue were under further review and that some of the key claims had already been deemed invalid by the USPTO. Plaintiff’s lawyers were still able to wave in front of the jury the blue ribbon certificates of the patents previously issued by the USPTO.

No damages were awarded. The judge denied the plaintiff any damages (over $20 million was sought) because their expert witness had handpicked from earlier settlement agreements ignoring those with lower amounts.  

However, the jury found infringement and Lawson was enjoined from selling and servicing certain software products. The litigation cost Lawson large legal fees, resulted in enormous business disruption, including time and expense of key personnel involved as witnesses, in depositions, development of non-infringing alternatives, and extensive customer services including training and education related to the litigation.

I will let others debate the merits of the Apple patents and whether or not that jury verdict was a correct one. These cases do however make you wonder whether (i) judges and juries are appropriate for resolving these types of patent disputes and (ii) the patent system as it currently exists is effective at rewarding intellectual achievement and enhancing innovation.

Patents can be extremely valuable for large corporations and entrepreneurs. They can serve as an incentive to invest in innovation and result in breakthrough ideas. If, however, a mistake is made in the issuance of a patent (even the USPTO will admit to mistakes) the reexamination process should be expedited and utilized as necessary to mitigate and avoid litigation.

Now for some fun.

Can you pick the one patent below that was issued and later invalidated through a reexamination by the USPTO ? 

1.  Motorized Ice Cream Cone (#5,971,829).  A novelty amusement eating receptacle for supporting, rotating and sculpting a portion of ice cream or similarly malleable food while it is being consumed comprising: a hand-held housing, a cup rotatably supported by the hand-held housing and adapted to receive and contain a portion of ice cream or food product of similar consistency, and a drive mechanism in the hand-held housing for imparting rotation upon the cup and rotationally feeding its contents against a person's outstretched tongue.

2.  Pet Display Clothing (#5,901,666).  A vest or belt is integrally formed with tubular, pet receiving passageways which extend around the wearer's body and terminate in pocket-like chambers for feeding and retrieval. Outer wall portions of the passageways are transparent so that a pet moving along the passageways can be seen by a spectator. Graphics or indicia depicting the pet's habitat or a pet story are marked on the vest and extend across portions of the passageways masking delineations or depicting the passageways as burrows.
3.  Sealed Crustless Sandwich (#6,004,596).  A sealed crustless sandwich for providing a convenient sandwich without an outer crust which can be stored for long periods of time without a central filling from leaking outwardly. The sandwich includes a lower bread portion, an upper bread portion, an upper filling and a lower filling between the lower and upper bread portions, a center filling sealed between the upper and lower fillings, and a crimped edge along an outer perimeter of the bread portions for sealing the fillings therebetween. The upper and lower fillings are preferably comprised of peanut butter and the center filling is comprised of at least jelly. The center filling is prevented from radiating outwardly into and through the bread portions from the surrounding peanut butter.

4.  Snake Walker (#6,490,999).  Collar apparatus enabling secure handling of a snake by tether [see drawing above].

5.  Painting Kit and Related Method (#6,213,778).  A unique painting process and an associated kit including the materials required for practicing the method. The method includes the acts of providing a background media providing a paint source, dipping the posterior of the infant in the paint, and stamping the posterior on the background media to create stamping prints. The kit of the present invention includes a flat, flexible backing piece, at least one paint bottle attached to the backing piece, at least one reservoir attached to the backing piece, at least one painting tool attached to the backing piece, and a plastic cover having a periphery, the plastic cover positioned over the protective cover, plurality of paint bottles, plurality of reservoirs, and plurality of paint brushes, and attached around its peripheral edge to the backing piece.

If you selected the Sealed Crustless Sandwich you are correct. The USPTO issued a reexamination certificate for this patent and cancelled all claims. Smuckers built a large manufacturing plant (prior to the invalidation of the patent) and continues to produce the unpatented sandwiches under the brand “Uncrustables®”.

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