CAFC Rules in Egyptian Goddess: Point of Novelty Test Gone (sort of)

The Federal Circuit issued its en banc decision today in Egyptian Goddess, Inc. v. Swisa, Inc. (2006-1562). In a decision authored by Judge Bryson, the Court thoughtfully and carefully reviewed the history of the "point of novelty test," concluding that the test in its current incarnation "is of quite recent vintage" and holding that it "should no longer be used in the analysis of a claim of design patent infringement."


While the case holding is quite clear in ridding design patent law of the point of novelty test, the opinion does not say one may ignore the prior art during an analysis of design patent infringement. On the contrary, "when the claimed and accused designs are not plainly dissimilar, resolution of the question whether the the ordinary observer would consider the two designs to be substantially similar will benefit from comparison of the claimed and accused designs with the prior art." Eliminated from the plaintiff's burden of proof in a design patent case, the point of novelty test therefore survives as a defensive doctrine, where the burden of producing prior art rests on the accused infringer. Under this new legal framework, one accused of design patent infringement is free to argue that any similarity between its device and the patented design results from prior art features or combinations and that the hypothetical ordinary observer would therefore not find the two designs "substantially the same."



What this means to a litigator like me is that a lot more design patent cases will go to the jury under the new test. Whether similarity in any given case is due to copying the prior art or due to actionable copying of the patented design is something the jury will now be asked to sort out on a more frequent basis. Score one point for trial lawyers and another for design patent holders in general.



In addition to eliminating the point of novelty test as a part of the Plaintiff's burden of proof for infringement, the opinion says that a detailed claims construction is not required, and that "the preferable course ordinarily will be for a district court not to attempt to 'construe' a design patent claim by providing a detailed verbal description of the claimed design." A district court may (in its discretion) reduce the design patent claim to a verbal or written pronouncement of scope, and the opinion gives several examples where a court might choose to do so; like where features appear in broken lines or where features have a purely utilitarian (as opposed to ornamental) purpose. The court has only one proviso "as a general matter, those courts should not treat the process of claim construction as requiring a detailed verbal description of the claimed design, as would typically be true in the case of utility patents."


So there you have it. Life just got a little easier for those owning design patents.

Business Method Patents To Be Reviewed En Banc

The Federal Circuit decided to review the patentability of business methods en banc in the case In re Bilski. The en banc order presents the following 5 questions:

1. Whether claim 1 of the 08/833,892 patent application claims patent-eligible subject matter under 35 U.S.C. § 101?

2. What standard should govern in determining whether a process is patent-eligible subject matter under section 101?

3. Whether the claimed subject matter is not patent-eligible because it constitutes an abstract idea or mental process; when does a claim that contains both mental and physical steps create patent-eligible subject matter?

4. Whether a method or process must result in a physical transformation of an article or be tied to a machine to be patent-eligible subject matter under section 101?

5. Whether it is appropriate to reconsider State Street Bank & Trust Co. v. Signature Financial Group, Inc., 149 F.3d 1368 (Fed. Cir. 1998), and AT&T Corp. v. Excel Communications, Inc., 172 F.3d 1352 (Fed. Cir. 1999), in this case and, if so, whether those cases should be overruled in any respect?

For more coverage of this developing story, see Dennis Crouch's Patently-O post here, and Peter Zura's 271 blog post here.

I've also posted on the topic of patentable subject matter here, and was counsel of record for the Federal Circuit Bar Association in that group's amicus brief to the U.S. Supreme Court in Labcorp v. Metabolite Labs. We argued for the petition for certiorari to be dismissed as improvidently granted, and that is what eventually happened in that case. (See this link for some good coverage of the Labcorp case from UW Law School's CASRIP ("Center for Advanced Study and Research on Intellectual Property") Newletter.)

I think this decision by the Federal Circuit, i.e. to take up the issue of patentable subject matter en banc, could potentially eliminate (or delay), any grant of certiorari by the Supreme Court on this topic. Some speculate that the Supreme Court will grant certiorari in In re Nuijten, another section 101 case where the CAFC--over the dissents of Judges Linn, Newman, and Rader--declined to consider patentable subject matter en banc. The CAFC's timing here may fortuitously avoid the Supreme Court stepping in to re-write the law of patentable subject matter in connection with In re Nuijten. Based on the comments of Justices Breyer and Stevens at the February 2007 oral argument in the ATT v. Microsoft case, at least these Justices seem ready and willing to take a hard new look at the scope of patentable subject matter under section 101. The questions raised by the CAFC's order in In re Bilski could have easily come from Justices Stevens or Breyer, so it will be interesting to see how this issue develops and whether the CAFC can assuage concerns voiced by Justices Breyer and Stevens.