This Q&A is one in a series featuring MBHB partners discussing 2014 developments in intellectual property law and the 2015 outlook.
Bradley J. Hulbert is a partner with McDonnell Boehnen Hulbert & Berghoff LLP. Mr. Hulbert, a founding partner in MBHB, has diverse experience in obtaining, evaluating, and enforcing intellectual property. As a counselor to both Fortune 500 and start-up, venture capital companies, he has a special interest in developing creative, cost-effective strategies to address specific business objectives. Mr. Hulbert’s litigation experience relates to patents, copyrights, trade secrets, trademarks, and unfair competition and alternative dispute resolution. He has served as lead trial and appellate counsel in a wide range of successful intellectual property litigation, often involving complex electrical and software technologies. firstname.lastname@example.org
Marcus J. Thymian is the current managing partner of McDonnell Boehnen Hulbert & Berghoff LLP. Mr. Thymian helps clients obtain, enforce, and defend against patents involving primarily electrical, mechanical, and software technologies. His past work has spanned many technologies, including medical devices, semiconductors, electronic trading software, cellular communications, cables and connectors, and unmanned aerial vehicles, among others. His clients range from small start-ups to Fortune 100 multinational corporations. In addition to formulating patent portfolio strategies to protect companies’ most valuable products, Mr. Thymian oversees the preparation and prosecution of patent applications composing patent portfolios. He enjoys working closely with in-house counsel to ensure that his client is positioned to meet all business goals and objectives, whether they relate to competitive strategy, international markets, or financial outcome. email@example.com
What were the top three IP issues or cases in 2014?
BH: In the high tech sector, the top decisions in 2014 were:
MT: In addition to the cases that Brad mentioned, the continued “pro-patent vs. anti-patent” dispute was also an important IP issue this year.
Are there any influential decisions or issues that will remain at the forefront next year?
BH: Yes. In Teva Pharmaceuticals USA, Inc. v. Sandoz, Inc., the Supreme Court granted Teva’s petition for writ of certiorari. The Court will decide whether a district court decision on claim construction should be given de novo review. A decision changing the rule of de novo review of claim construction has the potential to dramatically affect the nature of patent litigation. If claim construction becomes a fact-based determination, the length, complexity and cost of determining claim scope could increase dramatically.
MT: The Alice and Nautilus law will be developed by lower courts over the next year. Lots of uncertainty exists now, and it will take several years to gain an understanding of where the law is going in these areas.
BH: On that front, many in the software industry would argue that by decreasing the availability of patents, or at least decreasing the predictability with which one may obtain an enforceable software patent, the less likely people will be to invest in software. As such, the Alice decision could conceivably contribute to the U.S. losing its global lead in developing the best technologies.
Are there any budding trends you’ve seen in the news recently that you think may become more prominent issues in the next year? What implications do they have for the legal industry and for the technology industry in particular?
BH: Yes. There seems to be increasing awareness of Non-Creative Entities (NCEs) and their practices. Recent changes in case law and in Federal Rules of Civil Procedure have made it more difficult for NCEs to practice their trade (e.g., obtaining patents inexpensively, asserting them and then licensing the patents for less than the cost of litigation). I suspect this trend will continue.
Most significant though is the increasing awareness that patent litigation should not be considered a lottery (i.e., entities assert patents against large, profitable businesses, argue that the patent claims “enabling technology” and then “swing for the fences” in an effort to score nine-digit damages). I suspect that in coming years, U.S. courts will (in a stroke against NCEs, if nothing else) more seriously consider the profit contribution made by a patented technology and limit damages awards accordingly.
MT: Additionally, the Internet of Things will continue to grow, spurring new challenges and thus new inventions and patents related to security (authenticating devices and users), reliability and interoperability of devices.
What do you anticipate will be the most influential topics or cases in the technology industry in 2015, and why?
BH: The Alice decision is the “800-pound gorilla” in the room. The more that software is viewed as ineligible for patent protection, the less likely the industry will be to invest in patents and in turn reducing the incentive for investing in software. Ultimately, the CAFC is expected to eventually publish a set of rules that will allow many software inventors to seek and enforce patents on their inventions.
MT: As several medical devices utilize software, I think it will be difficult for many of those inventions in particular to maintain their patent eligibility under the Alice ruling.
BH: Yes. One example could be that the Court will require a significant, physically observable feature for these devices in order to remain protected, e.g., not just an output generated by a general purpose computer, but an “improved display” that is demonstrably easier for a human to read, and/or provides a more reliable indicator of diabetes, etc. may remain eligible.
MT: Additionally, patenting and enforcement issues in the 3D printing space will likely borrow from trademark and copyright law next year. I expect we’ll likely see new patent filings targeting improvements in the 3D printing process and related materials, and 3D-printed articles with unexpected benefits derived from where or when they can be printed. Furthermore, a widespread adoption of 3D printing by large manufacturing companies could accelerate legislation related to these tricky patent issues.