Patent Law Practice Center

ITC institutes investigation against Hisense

The U.S. International Trade Commission (ITC) announced that it has decided to institute a patent infringement investigation against Chinese electronics manufacturer Hisense. The investigation, which follows from a Section 337 complaint filed by Japanese electronics firm Sharp, will seek to determine whether certain Wi-Fi enabled devices and their components, specifically televisions which are capable of wireless Internet connectivity imported into the U.S. by Hisense, infringe upon two patents covering similar technologies held by Sharp.

The ITC’s decision to institute the Section 337 investigation comes after the agency announced on August 30th that it had received the patent infringement complaint from Sharp. In Sharp’s Section 337 complaint, two patents held by Sharp are identified as being infringed by Hisense’s television products:

• U.S. Patent No. 8325838, titled Communication Method and Radio Transmitter. Issued in December 2012, it claims a receiving apparatus operable in a wireless communication system which increases the efficiency of frequency utilization and seamlessly provide services to private isolated cells within a wireless local area network (LAN).
• U.S. Patent No. 8279809, titled Transmission Power Control for Orthogonal Frequency Division Multiplexing (OFDM) Signals, issued in October 2012, covers an apparatus configured for transmitting orthogonal frequency division multiplexing (OFDM) signals for communication in a wireless system in a way that delivers rich content services via OFDM wireless schemes while achieving the use of OFDM recievers in low-cost and smaller terminals.

Sharp’s Section 337 infringement complaint seeks a permanent limited injunction order against Hisense’s Wi-Fi-enabled television sets as well as a permanent cease and desist order prohibiting Hisense from importing and selling the patent infringing products. Sharp argued to the ITC that there are no public welfare concerns and that articles like the infringing Hisense products are available to the public in sufficient capacity to meet demand. Although Sharp notes that the asserted patents cover aspects of wireless communication which are in part described in the IEEE 802.11n wireless standard, they are not subject to fair, reasonable and non-discriminatory (FRAND) licensing obligations as they are not standard essential patents (SEPs). Although Hisense has entered into a trademark licensing agreement with Sharp to sell TVs branded under the Sharp name in the U.S., it does not have a license to either the ‘809 or ‘838 patents.

As Sharp explains in its complaint, the technology covered by the ‘809 patents resolves an issue regarding terminals with different capabilities which coexist in a system. The IEEE 802.11n standard introduced a new high-throughput access point and non-access point stations capable of receiving or transmitting by a broader part of a 20 megahertz (MHz) frequency band than legacy technologies. The technology allows the new high-throughput access points to communicate with legacy stations while also communicating with new high-throughput devices to achieve better performance in signal transmission.

Sharp’s complaint also notes that the technology covered by the ‘838 patent solves a similar issue created by the IEEE 802.11n amended standard so that legacy stations and new stations can coexist, reducing the cost of replacing devices for the new standard. This technology allows some new high-throughput stations to use multiple frequency channels for maximum throughput while allowing other new stations to use fewer subcarriers, minimizing energy use.

Sharp contends that Hisense, or others on the behalf of Hisense, manufacture infringing television products in Mexico, China or other countries outside of the U.S., and import them for sale in this country. For example, four infringing Hisense products were purchased this June through Walmart.com or at a Best Buy in Union City, CA. These products include three 50-inch TVs and one 43-inch TV with markings indicating that they were made in either Mexico or China.

CAFC reverses on erroneous application of BRI

The United States Court of Appeals for the Federal Circuit recently issued a decision in In re Smith International, Inc. As described by Judge Alan Lourie, writing for the unanimous panel (consisting of Judges Reyna and Hughes), “[t]his case primarily concerns what the word ‘body’ means in the context of the ‘817 patent.” More specifically, however, the legal point at issue making this case a precedential decision was how far the Patent Office may go when applying the “broadest reasonable interpretation” (“BRI”). The Federal Circuit decided that in applying the broadest reasonable interpretation, the examiner and Patent Trial and Appeal Board (PTAB) arrived at an unreasonable interpretation not supported by the specification.

The examiner interpreted the critical term “body” as being very broad and possible of encompassing other components such as a “mandrel” and a “cam sleeve,” which were taught by the Eddison reference. The Board affirmed this interpretation by the examiner because the specification did not prohibit the examiner’s broad reading of the term “body.”

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CAFC strikes down EDTX venue test

The United States Court of Appeals for the Federal Circuit has struck down a much-criticized venue test created by Judge Rodney Gilstrap of the United States Federal District Court for the Eastern District of Texas. See In re: Cray Inc.

In a unanimous panel decision authored by Judge Alan Lourie (joined by Judges Reyna and Stoll), the Federal Circuit found that Judge Gilstrap misinterpreted the scope and effect of Federal Circuit precedent in determining that Cray maintained “a regular and established place of business” in the Eastern District of Texas within the meaning of 28 U.S.C. § 1400(b). Accordingly, Judge Gilstrap’s denial of Cray’s transfer motion was an abuse of discretion. The Federal Circuit panel ordered the case transferred, but did not decide to which court the case should be transferred. While Cray would prefer transfer to the Western District of Wisconsin, Raytheon would prefer transfer to the Western District of Texas. The Federal Circuit left the decision of which district to transfer the case to for remand.

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Burden of persuasion on Petitioner for IPR amendments

On October 4, 2017, the United States Court of Appeals for the Federal Circuit issued its much-anticipated decision in Aqua Products, Inc. v. Matal, addressing en banc whether the patent owner has the burden of proving patentability with respect to submitted amended claims during an inter partes review (IPR) proceeding. Previous panels of the Federal Circuit had ruled that the burden of persuasion to demonstrate patentability was with the patent owner, not with the challenger. Sitting en banc, the Federal Circuit issued a narrow ruling saying that the burden of persuasion must remain at all times on the petitioner, including with respect to demonstration of unpatentability of amended claims.

The ruling of the court was described to be “narrow” by Judge O’Malley, who wrote for the majority in announcing the limited decision. There was no consensus among the Judges with respect to the judgment that should be reached and the rationale that should be employed, which meant very little of what was actually written in the five opinions and some 135 pages was actually precedential. This lack of consensus would explain why it took the Federal Circuit ten months after the oral arguments in this case to issue a decision.

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PTO Update from John Cabeca, Silicon Valley Director

Last week John Cabeca (left), Director of the Silicon Valley branch of the United States Patent and Trademark Office, delivered the Keynote Speech at the 2017 Annual Meeting of the Association of Intellectual Property Firms (AIPF) in San Francisco, California. What follows are several of the more interesting points Cabeca make during his 30-minute presentation.

“Typically it takes three months plus or minus a month, depending upon what Congress has on their schedule, but we look forward to having Mr. Iancu on board,” said Cabeca, when addressing the most common question he gets of late – when can we expect the new Director to be confirmed and in place.

Cabeca’s assessment on the Iancu timeframe is in keeping with everything I’ve been hearing. President Trump nominated Andrei Iancu to be the next Director of the USPTO on August 25, 2017. Perhaps Iancu will manage to find himself a part of some late-year nominee deal in the Senate, perhaps he will be held over for confirmation until early 2018. Read the rest of this entry »