FTC Stops Deceptive Patent Demand Letters

In a move reminiscent of the action taken earlier this year by NY Attorney General Eric T. Schneiderman, the Federal Trade Commission last week  announced that MPHJ Technology Investments, LLC, agreed to settle Federal Trade Commission charges that they used deceptive sales claims and phony legal threats in letters that accused thousands of small businesses around the United States of patent infringement. As is typical for FTC settlements, the proposed consent order was published in the Federal Register and public comments have been solicited. The proposed consent order will be subject to public comment for 30 days, continuing through December 8, 2014, after which the Commission will decide whether to make the proposed consent order final. Interested parties can submit written comments electronically or in paper form. Although the FTC will accept these comments, in my experience, when an enforcement settlement has gotten to this stage, we can expect the proposed settlement to become final.

The settlement with MPHJ is the first time the FTC has taken action using its consumer protection authority against a patent assertion entity (PAE). Perhaps most significantly, in the announcement of the settlement, the FTC acknowledged that patents promote innovation, which is a simple enough truth. Still given recent FTC inquiry into the industry, this statement from the Obama Administration could signal that the FTC will take actions only against outliers and not the bulk of the industry, which operates legitimately to enforce valid patents.

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Standard Essential 4G/LTE Portfolio Up for Sale

A 4G/LTE patent portfolio, which includes patents having priority filing dates all the way back to April 2001, is currently for sale through ICAP Patent Brokerage. This news is of particular interest because it is not every day that you see standard essential patents hit the market, and in this case the patents cover a variety of carrier grade wireless technologies that are widely used within the industry.

The patent portfolio belongs to Raze Technologies, a research and development company founded in late 1999 with the purpose of developing a last mile access system that would allow service providers to offer both broadband data and high-quality, fully featured voice services to residential and small business customers. In August 2002, Raze suspended its development operations and focused its remaining resources on the prosecution of its patent portfolio. Over time, as most if not all of the other innovative start-ups in the space have gone the way of the dinosaur, Raze has managed to accumulate a foundationally important patent portfolio relating to standard-related innovations surrounding mobile network infrastructure technologies that relate to 4G/LTE, which is the next generation wireless standard.

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11.11.14 | posts | Gene Quinn

Willful Infringement Center Stage at Federal Circuit

The United States Court of Appeals for the Federal Circuit recently issued a unanimous panel decision in Halo Electronics, Inc. v. Pulse Electronics, Inc. This decision may have more far-reaching implications for patent reform than any other decision reached by any court in recent memory. The issue of particular interest in this case was willful infringement, and in a concurring opinion, Judges O’Malley and Hughes wrote that the majority was constrained by the Federal Circuit’s precedent in In re Seagate and Bard Peripheral Vascular v. W.L. Gore, but that recent Supreme Court decisions call into question the continued viability of that precedent. As such, Judges O’Malley and Hughes urged the Federal Circuit to reconsider en banc the standard for awarding enhanced damages under 35 U.S.C. 284.

The case came to the Federal Circuit on an appeal by Halo Electronics, Inc. (“Halo”), who appealed from multiple decisions of the United States District Court for the District of Nevada. First, Halo appealed the granting of summary judgment that Pulse Electronics, Inc. and Pulse Electronics Corp. (collectively “Pulse”) did not sell or offer to sell within the United States the accused products they manufactured for delivery to buyers outside the United States. Second, Halo also appealed the granting of summary judgment that Pulse did not directly infringe Halo’s U.S. Patents 5,656,985 (the “’985 patent”), 6,297,720(the “’720 patent”), and 6,344,785 (the “’785 patent”) (collectively “the Halo patents”). Finally, Halo appealed the holding that Pulse’s infringement of the Halo patents with respect to certain accused products that Pulse sold and delivered in the United States was not willful.

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11.10.14 | CAFC, Patent Damages, Patent Issues | Gene Quinn

Failure to Argue Waives Infringement on Proper Claim Construction

Recently, the Federal Circuit issued a decision in CardSoft v. Verifone, in which the Court overturned the district court’s claim construction. Overturning a district court’s claim construction is hardly unusual, and perhaps more typical than it really should be. What was unique about this particular case was that the Federal Circuit also went on to rule that CardSoft had waived any argument that the defendants had infringed under the correct claim construction, as a matter of law.

CardSoft filed this patent infringement suit in March 2008 against VeriFone, Inc., VeriFone Systems Inc., and Hypercom Corp. (collectively, “Defendants”), asserting infringement of U.S. Patent Nos. 6,934,945 (“the ’945 patent”) and 7,302,683 (“the ’683 patent”). The district court held a Markman hearing in July 2011 and conducted a jury trial in June 2012. The jury determined that certain of the Defendants’ devices infringed claim 11 of the ’945 patent and claim 1 of the ’683 patent and that these claims were not invalid. The Defendants moved for a new trial and for judgment as a matter of law, but the district court denied both motions.

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Big Tech Turns to Biometric Innovation

Over on IPWatchdog.com, I publish what we call Companies that We Follow. The goal is to look for interesting new technologies by exploring what some of the most innovative companies in the world are working on. After a while, you see a lot of different technologies and sometimes you start to notice patterns. Analysis of biometric data has been a major area of new research among electronics manufacturers in recent years, and over the last several months we have seen quite a few biometric innovations from a variety of very large tech corporations.

One recent innovation that we saw came from Microsoft, and it related to something that you might not ordinarily associate with the giant from Redmond, Washington…namely, a mood detection device. Stress is something that everyone experiences throughout their daily life, and biometric systems for determining mood and stress levels are not new. However, reducing stress and the associated negative impacts, like chronic health conditions and poor work performance, is an important goal that could easily result in a meaningful increase in productivity in the workplace. To tackle this problem, Microsoft came up with a device that uses a microcontroller capable of processing biometric data about a person’s stress levels. The patent application filed, U.S. Patent Application No. 20140085181claims priority to a provisional patent application filed in September 2012, which is incorporated by reference. The device described in this patent application includes a flexible material that morphs its shape to create a representation of the received biometric information. Stress information can also be output to a display that lets a person view stress and mood information and add their own personal input. This system could receive biometric data signals indicative of mood from a variety of sources, including a heart rate monitor, galvanic skin monitor, camera or microphone. For instance, a camera and image processing system could determine a change in mood based on an eyebrow shift or another facial expression. Along with changing shapes, the device can indicate a person’s mood through sounds or light display.

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10.27.14 | Biotech, Patent Issues | Gene Quinn

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