Ninth Circuit Says Discovery Rule Survived Petrella, CJEU

Bite (noun): more meaty news to sink your teeth into.

Bark (noun): peripheral noise worth your attention. week in Other Barks & Bites: the Ninth Circuit holds that public policy arguments cannot overturn claims to monetary damages stemming from a French copyright proceeding; the Ninth Circuit also affirmed that the discovery rule still applies to copyright claims despite the application of laches to the Copyright Act’s statute of limitations in Petrella v. Metro-Goldwyn-Mayer; Judge Newman dissents from the Federal Circuit’s ruling that an error in asserted prior art is merely typographical and would have been overlooked by a person of ordinary skill in the art; WIPO Director Tam calls on attendees of the WIPO Assemblies to use IP as a “powerful catalyst for jobs”; TSMC posts record quarterly net income as the company provides optimistic guidance on supply chain issues in the chip market; and the CJEU rules that “Feta”-branded cheese sold by Danish cheese makers violates EU law on protected designations of origin even when that cheese is sold outside of the EU.


Ninth Circuit Affirms That Discovery Rule is “Alive and Well” Post-Petrella – On Thursday, July 14, the U.S. Court of Appeals for the Ninth Circuit issued a decision in Starz Entertainment, LLC v. MGM Domestic Television Distribution, LLC in which the appellate court affirmed a district court’s denial of a motion to dismiss many of Starz’s 340 counts of copyright infringement for MGM’s improper licensing of films to Amazon during Starz’s period of exclusivity. The Ninth Circuit agreed with the district court that the U.S. Supreme Court’s 2014 decision in Petrella v. Metro-Goldwyn-Mayer, which applied the doctrine of laches to the Copyright Act’s three-year statute of limitations, did not eliminate the discovery rule under which a claim for copyright infringement accrues when the copyright owner discovers or reasonably should have discovered the infringement.

Sixth Circuit Reverses Enhanced Damages Award in Gym Equipment Trademark Case – On Thursday, July 14, the U.S. Court of Appeals for the Sixth Circuit issued a decision in Max Rack, Inc. v. Core Health & Fitness, LLC in which the appellate court affirmed most of a district court’s post-verdict ruling overturning a $1 million damages award to gym equipment developer Max Rack. Although the Sixth Circuit affirmed a $250,000 award to Max Rack for lost profits, the appellate court reversed both the district court’s enhancement of the lost profits award for improperly shifting the burden of discovery onto Core Health, as well as attorney’s fees after finding that Core Health did not litigate in an unreasonable manner. Circuit Judge R. Guy Cole Jr. dissented in part, arguing that the panel majority should have left the enhanced profits and attorney’s fees award intact. 

CJEU Says Exports of Denmark “Feta” Cheese Outside EU Still Violates PDO Law – On Thursday, July 14, the Court of Justice for the European Union (CJEU) issued a ruling affirming the European Commission’s earlier determination that sales of cheese produced in Denmark and labeled as “Feta,” a name that was earlier registered as a protected designation of origin (PDO) by Greece and Cyprus, violates the EU’s PDO regulations despite the fact that the “Feta”-branded cheese was only sold to customers in countries outside of the EU. The CJEU also ruled that, despite the violation, Denmark has not violated its obligation of sincere cooperation under EU law as Denmark hasn’t taken any actions that would weaken the EU’s position in international negotiations.

CAFC Affirms Denial of Preliminary Injunction Against Philips’ USITC Exclusion Order – On Wednesday, July 13, the U.S. Court of Appeals for the Federal Circuit issued a precedential decision in Koninklijke Philips N.V. v. Thales DIS AIS USA LLC in which the appellate court affirmed the District of Delaware’s denial of Thales motion for a preliminary injunction to prevent Philips from seeking an exclusion order at the U.S. International Trade Commission (USITC). The Federal Circuit ruled that evidence of speculative harms, including Thales’ potential inability to deliver products to customers if the exclusion order is entered, is insufficient to show a likelihood of irreparable harm.

Ninth Circuit Says Public Policy Cannot Defeat Money Claims for French Copyright Ruling – On Wednesday, July 13, the Ninth Circuit issued a decision in De Fontbrune v. Wofsy in which the appellate court reversed a ruling by the Northern District of California granting summary judgment to American art editor Alan Wofsy after finding that an astriente, a proceeding under French law awarding money damages for continued copyright infringement, was repugnant to U.S. law. The Ninth Circuit held that summary judgment was inappropriate for resolving claims that alleged copyright owner Yves Sicre de Fontbrune fraudulently misrepresented an ownership interest during the French proceedings in the Pablo Picasso works at issue in the action.

Fifth Circuit Reverses Dismissal of Beatriz Ball’s Copyright, Trade Dress Claims – On Tuesday, July 12, the U.S. Court of Appeals for the Fifth Circuit issued a decision in Beatriz Ball, L.L.C. v. Barbagallo Co., L.L.C. in which the appellate court reversed the Eastern District of Louisiana’s dismissal of copyright and trade dress claims filed by Beatriz Ball, finding that the district court erred in finding that Beatriz Ball had no standing to pursue its copyright claims or any protectable trade dress under the Lanham Act for the company’s silver alloy home metalware products. Circuit Judge Gregg Costa wrote an opinion specially concurring in the judgment to discuss the lower amount of deference paid by an appellate court to judge rulings after bench trials than the appellate court pays to jury verdicts.

Petitioner Briefs at SCOTUS Distance Section 101 Issues from American Axle Cert Denial – On Monday, July 11, patent owner Interactive Wearables filed a reply brief with the U.S. Supreme Court highlighting issues with the Federal Circuit’s treatment of patent eligibility under 35 U.S.C. § 101 and how that court’s Section 101 analysis is wading into 35 U.S.C. § 112 enablement issues. About a week earlier, inventor David Tropp filed a petition for writ of certiorari with the Supreme Court in which Tropp argued that his case provides a better vehicle than American Axle for the U.S. Supreme Court to address Section 101 eligibility issues. Both filings come after the Supreme Court denied cert in American Axle & Manufacturing v. Neapco Holdings, a case which has created a controversial expansion to judicial exceptions to Section 101 patent eligibility.

CAFC Says Error in Prior Art Is Merely Typographical Over Judge Newman Dissent – On Monday, July 11, the Federal Circuit issued a precedential decision in LG Electronics Inc. v. ImmerVision, Inc. in which the appellate court affirmed a pair of rulings by the Patent Trial and Appeal Board (PTAB) finding that LG Electronics did not prove that challenged patent claims owned by ImmerVision were obvious, in part because the asserted prior art reference included a typographical error in a table of aspheric coefficients that would have been dismissed by a person of ordinary skill in the art. Circuit Judge Pauline Newman dissented in part, arguing that the error was not merely typographical because it required an expert witness to conduct 12 hours of experimentation to discover the error, thus the error wasn’t readily apparent on its face.


Director Tam Urges Transformational Use of IP as Jobs Catalyst at WIPO Assemblies – On Thursday, July 14, the World Intellectual Property Organization (WIPO) opened its sixty-third meeting of the assemblies of WIPO member states with keynote remarks by WIPO Director Daren Tang, who called upon members of the IP community in attendance to “continue being fully committed to transforming IP from a technical vertical of interest only to specialists, into a powerful catalyst for jobs, investments and development that supports innovators and creators everywhere.” 

EPO Announces New Patent Administrator Certification for Patent Management – On Thursday, July 14, the European Patent Office (EPO) announced that the agency will be creating a European patent administration certification (EPAC) to certify professionals for managing filing, prosecution, grant and maintenance processes for European and international patent applications before the EPO. The EPAC program will begin enrollment on December 12 of this year.

Judge Albright Denies Stay, Says Meta Patent Trial Will Conclude Before Reexamination – On Tuesday, July 12, U.S. District Judge Alan D. Albright of the Western District of Texas issued an order denying Meta Platforms motion to stay a patent infringement case filed by VideoShare in large part because the district court trial between those parties is currently scheduled for next January, well ahead of the expected resolution of ex parte reexamination proceedings instituted by the USPTO on patent claims asserted by VideoShare in the lawsuit.

USPTO Requires Use of Office Form for PTA Information Disclosure Statements – On Tuesday, July 12, the U.S. Patent and Trademark Office issued a notice of proposed rulemaking (NPRM) in the Federal Register which will require patent applicants filing information disclosure statements regarding information material to patentability to use the agency’s Form PTO/SB/133, which is expected to streamline communications between the agency and patent applicants, in order to qualify for safe harbor provisions regarding patent term adjustments (PTAs) administered to patentees for USPTO patent prosecution and issuance delays.

ACUS Extends Public Comment Period on Small Claims Patent Court Study – On Tuesday, July 12, the Administrative Conference of the United States (ACUS) issued a notice in the Federal Register extending the public comment period for the agency’s study on the feasibility of a small claims court for patent infringement claims. Comments on the small claims patent court and any potential design suggestions are now being accepted until August 26 of this year.

USITC Requests Public Interest Submissions on LEO Against Apple Wearable Devices – On Monday, July 11, the U.S. International Trade Commission (USITC) issued a notice of request for submissions on the public interest on the relief recommended following the agency’s finding of a Section 337 violation by Apple, including a potential limited exclusion order (LEO) preventing the consumer tech giant from importing certain wearable devices with electrocardiogram (ECG) functionality into the U.S. for sale to consumers.

FCBA Names Knobbe Martens Partner Joseph Reisman as President – On Monday, July 11, intellectual property law firm Knobbe Martens announced that Joseph M. Reisman, Ph.D, has been selected to serve a one-year term as President of the Federal Circuit Bar Association (FCBA) after serving as an officer for the FCBA’s Board of Directors since 2019.

USPTO Announces Mandatory ID Verification for Electronic Trademark Filings – On Monday, July 11, the U.S. Patent and Trademark Office issued a notice in the Federal Register announcing that, as of August 6 of this year, the agency will begin requiring customers using a account for filing electronic trademark forms to verify their identity with the agency in an attempt to prevent fraudulent trademark filings.

This Week on Wall Street

Increased Demand from Tesla Spurs Panasonic’s $4B EV Battery Factory Plans – On Thursday, July 14, Japanese media outlet Nikkei Asia reported that representatives from Panasonic Energy confirmed Panasonic’s plans to invest $4 billion into the construction of an electric vehicle (EV) battery plant in Kansas to meet increased demand for batteries from EV developer Tesla.

TSMC Weathers Inflation, Chip Market Concerns With Record Quarterly Income – On Thursday, July 14, Taiwan Semiconductor Manufacturing Co., the world’s largest producer of semiconductors and computer chips, issued its earnings report for the second quarter of 2022’s fiscal year showing that the company took in net income of 237.03 billion Taiwanese dollars (about $7.9 billion USD), a record quarterly net income for TSMC despite supply chain issues for semiconductors and inflation spikes in economies across the world.

Quarterly Earnings – The following firms identified among the IPO’s Top 300 Patent Recipients for 2021 are announcing quarterly earnings next week (2020 rank in parentheses):

  • Monday: Bank of America Corp. (86th)
  • Tuesday: Halliburton Co. (47th); Johnson & Johnson (22nd); Lockheed Martin Corp. (t-289th); Texas Instruments Inc. (42nd); Volvo AB (196th)
  • Wednesday: Abbott Laboratories (121st); ASML Holding N.V. (157th); Baker Hughes Co. (112th); Hyundai Motor Co. (24th); Nidec Corp. (138th)
  • Thursday: ABB Ltd. (132nd); AT&T Inc. (36th); Capital One Financial Corp. (63rd); Disco Corp. (t-265th); Nokia Corp. (64th); SAP SE (69th); Seagate Technology plc (185th)
  • Friday: Schlumberger Ltd. (100th); Verizon Communications Inc. (60th)

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