Prepared by Cislo & Thomas LLP Attorney Mark D. Nielsen, Ph.D.
1. In what may be an effort to slow the filing of Section 101/Alice motions to dismiss in district courts around the country, and thus, slow the flow of the appeal of such motions to the Federal Circuit Court of Appeals, the Federal Circuit issued its opinion in MyMail, Ltd. v. ooVoo, LLC. The opinion, which for patent litigators is something of an “O2 Micro for 101 Motions,” indicates that where there are legitimate disputes about the construction of a claim term that could impact a decision on a Section 101/Alice motion to dismiss, the claim construction dispute needs to be resolved before the court can rule on the Section 101 eligibility issue. The temptation for patent owners may be to “manufacture” a claim construction dispute to stave off, or delay, the 101 challenge. That approach, however, may be problematic as the patent owner may be stuck with a construction that helps with 101, but hurts with respect to infringement or other grounds for invalidity. Lastly, this could be another “shot across the bow” of Congress by the Federal Circuit via which the Federal Circuit is saying, “we are getting tired of reviewing decisions on 101 motions with no further guidance on actual eligibility standards, so we are going to try to slow the spigot of 101 motions in district courts and thus, appeals of decisions on 101 motions to this Court.” Nonetheless, this creates a potential tool for patent owners trying to slow the invalidation of their patents on Section 101 grounds, but not without potential pitfalls.
2. In a recent trademark case out of the Second Circuit Court of Appeals, the Second Circuit held that a plaintiff may not have to show actual confusion in order to be entitled to recover a defendant’s profits in a trademark infringement case. The opinion is here. The district court awarded the plaintiff the defendant’s profits as a measure of damages, and then trebled them based on a finding of willfulness. The Second Circuit affirmed the award of damages based on defendant’s profits, but vacated and remanded the case on the issue of whether or not the case was “exceptional” in light of the Octane Fitness case. Basically, the Second Circuit, in what seemed to amount to something of an adverse inference, stated that a finding of willfulness could be sustained where a party did not put on a significant defense on the issue. The Second Circuit also noted that there are several rationales for issuing an award of defendant’s profits as a measure of damages, and at least one of them was met in this case. Overall, this is a very helpful case to trademark plaintiffs seeking to recover defendant’s profits as a measure of damages. It is also a cautionary tale about allowing a case with a weak willfulness defense to go to trial.
3. In a recent copyright case out of the Third Circuit Court of Appeals, the Third Circuit upheld the validity of a copyright registration for a costume shaped like a banana. The opinion is here. The Court, following the Supreme Court’s recent opinion in the Star Athletica case, found that a useful article, such as a costume, shaped like something commonly encountered, can contain separable subject matter protectable by copyright when the elements of the design are viewed in combination, not isolation. The defendant in the case admitted similarity for purposes of appeal. One interesting group of arguments by the defendant were based on the doctrines of merger and scenes a faire, wherein the combination of design elements for which copyright is sought were asserted to be necessary to depict any banana costume (merger) or so commonplace (scenes a faire) such that allowing them to be protected would allow for a monopoly on such a combination of design elements. The Third Circuit rejected these arguments and upheld the validity of the copyright. This argument may support a broader scope of copyright protection than may often be obtained through the Copyright Office’s examination guidelines.
