Federal Judiciary

"Intellectual Property and Patent Litigation Update" - SBOT Litigation Update seminar

By Michael C. Smith

I presented this morning at the State Bar's annual Litigation Update seminar in San Antonio on "Intellectual Property and Patent Litigation Update".  As my laptop ate my slide show, I just went through the paper I sent in last month, with one big addition being In re TS Tech. 
But there were a couple of useful additions based on my morning scan of the patent law blogs.  Patently-O had a timely post on the BPAI's decision in Ex parte Cornea-Hasegan (BPAI 2009)(non-precedential) in which it held that "a processor" is not a "particular" machine for purposes of meeting the patentability test of In re Bilksi.  It's always fun to tell a room full of non-patent lawyers trying to follow patent cases that a general purpose computer is not a machine.  I followed up with how "only if" is too complicated for jurors to understand without help.  That's always good for a (somewhat nervous) laugh from a lay attorney audience.  
Another useful tidbit for the presentation was Peter Zura's post on his 271 blog regarding yesterday's release by a group of U.S. manufacturers of research entitled ?The Likely Adverse Effects of an Apportionment-Centric System of Patent Damages.?  That survey, by Case Western economist Scott Shane gave some numbers on the effect that damages apportionment provisions in patent legislation would have.  I am not vouching for or against the study, but it's useful when discussing these provisions to be able to provide some metrics.  Previously, for example, in trying to quantify the effect of various caselaw and proposed statutory changes I've referenced a general railbird opinion that KSR may have invalidated as much as 60% of existing patents.  Given that I can't even remember who told me that, much less how reliable an estimate it is, it is useful to be able to say that there's research indicating that a damages apportionment provision would result in:

1. Reduction in overall U.S. patent value of between $34.4 billion and $85.3 billion.

2. Reduction in value of U.S. public companies of between $38.4 billion and $225.4 billion.

3. Reduction in R&D of between $33.9 billion and $66 billion per year.

4. Between 51,000 and 298,000 U.S. manufacturing jobs put at risk.

Again, I'm not endorsing or disagreeing with this report - just saying that it's a useful addition to the debate on the advisability of apportionment of damages provisions beyond what juries are currently instructed.

Full post as published by Eastern District of Texas Federal Court Practice on January 16, 2009 (boomark / email).