No Special Sovereign Immunity on Section 101

There isn't going to be a Get-Out-of-Section-101-Free card for state universities and other sovereign entities. At least, not judging by the Federal Circuit arguments Monday in The University of Florida Research Foundation v. General Electric Co.

Shore Chan DePumpo partner Michael Shore was trying to salvage a university patent on managing medical data from multiple bedside devices. A Florida federal judge had shot it down as an ineligible abstract idea.

Normally, when a patent owner sues for infringement, it waives its sovereign immunity in that court proceeding. But Shore argued that only applies to affirmative defenses like invalidity and indefiniteness. Patent eligibility is “not a pure affirmative defense. It is not simply saying 'I'm not liable,'” he told the court.

The argument didn't seem to get much traction. “Isn't it saying, 'I'm not liable because your patent's invalid?'” Judge Evan Wallach asked.

“No,” Shore replied, “it's 'I'm not liable because your patent should have never issued because it was always ineligible for patentability.'” Affirming would be “brand new. You'd be the first court to ever do it.”

Judge Kimberly Moore sounded dubious. She quoted directly from 2012's Dealertrack v. Huber: “The 'defenses provided in the statute, Section 282, include not only the 'conditions of patentability' in Sections 102 and 103, but also those in Section 101.” So how could Shore say this would be unprecedented?

“Maybe it was loose language,” Shore said. “It's a bit of a misnomer to call Section 101 an affirmative defense like 102, 103, 112. It's not the same.”

“I assure you, I know the judge who wrote it,” Moore replied. “It is not loose language.”

(Judge Richard Linn was the author of Dealertrack, in case you're wondering.)

Reed Smith partner Jim Martin argued for GE that under Federal Circuit precedent, it's the filing of the patent infringement suit that constitutes the waiver. “Then we're allowed to defend it any way we want to without implicating sovereign immunity,” he said.

He didn't get much pushback. Wallach suggested that if Shore were right, GE might even have a takings claim.

So why all the haggling over sovereign immunity? Why not just argue Section 101 on the merits, especially when you're before Judge Moore, one of the court's most dovish members on Section 101?

Shore tried. As his time wound down he argued that people had died because doctors and nurses couldn't put together in real time the heart rate, blood pressure, glucose levels and other measurements from separate devices. With the patent, “now you know what the other machines are doing, you can make combination alarms, you can save people's lives,” he said. “This was an entirely, newly, functional system.”

Moore told Martin that she found Shore's argument “confusing,” because the patent itself describes people performing the same functions on paper. “So it's not the case that no one ever before the patent had this concept,” she said. “So isn't this quintessentially the use-a-computer case?”

Martin hit it right out of the park. “Yes,” he said.

PUBG: Clip Art Claim Is 'Baseless'

Battlegrounds video game maker PUBG has fired back at competitor NetEase's claim that the company is trying to assert copyright based in part on widely available clip art in its game. “Defendants continue to assert and pursue baseless sanctions claims, as they have throughout this litigation,” Sidley Austin partner Steven Baik wrote to U.S. District Judge Jeffrey White in a Nov. 5 filing.

NetEase, maker of the competing Rules of Survival and Knives Out, asked White last week to delay ruling on its motion to dismiss PUBG's copyright complaint. The company's Quinn Emanuel Urquhart & Sullivan attorneys said they'd discovered that visual elements described as original and creative in PUBG's complaint are actually publicly available on sites such as Unreal Engine Marketplace.

Baik noted that PUBG's 157-page complaint describes a wide range of copying, from panoramic features such as parachuting onto an island down to minute details like the grenades and first aid kits that NetEase had seized on. But the complaint doesn't allege infringement based on individual graphic depictions that might have been obtained from a third party, Baik wrote. Rather, the claims are based on “the broader work of authorship reflected in the selection and combination of items, functions, and attributes, and not any particular image standing alone.”

In an Oct. 23 letter to his opponent, Quinn Emanuel partner Claude Stern, Baik wrote that “to the extent that there is any misunderstanding, PUBG confirms that it is not asserting and will not seek to assert any claim of copyright infringement based upon an element purchased from a third party.”

If NetEase still insists that PUBG amend its complaint, it will do so, Baik wrote. But the amended complaint will include an email PUBG received in April from a former NetEase employee that Baik says shows NetEase intentionally copied Battlegrounds.

PUBG told White that NetEase has so far refused to accept PUBG's proposals.

A10's Laura Peter Named PTO Deputy Director

It's been a big week for hiring at the PTO and in PTO-related practice. First, Commerce Secretary Wilbur Ross announced the appointment of Laura Peter as PTO deputy director.

Peter has served as deputy general counsel at A10 Networks for the last few years, and during the early 2000s was in-house at Foundry Networks and Immersion Corp. In between she ran Global General Counsel, a firm that provided GC services to small and mid-sized companies, and did similar work as an attorney at FLEX by Fenwick.

“Laura Peter brings a breadth of experience and a deep understanding of intellectual property issues to her new role as deputy director of the USPTO,” Ross said in a written statement. “She will be an asset to our administration as we look to increase reliability and balance in the intellectual property system.”

“Her thoughtfulness, business sense, and keen understanding of the important role intellectual property plays in today's economy will be extremely valuable to the USPTO and the IP community,” PTO Director Andrei Iancu added.

In addition to her legal experience, Peter is a former member of San Francisco's Republican Party Central Committee, and ran for California State Assembly in 2010 “on a pro-business platform to bring our economy back to health,” according to her LinkedIn bio. She lost to incumbent Tom Ammiano.

“I am honored to be chosen as USPTO deputy director at a time when intellectual property matters are at the forefront of national and international affairs,” Peter said in a written statement. “I look forward to working with Director Iancu and the nearly 13,000 employees of the USPTO to protect and improve our IP system, which is a crown jewel in the American economy.”

Knobbe's PTAB Chief Joins Womble Bond

Here is a true man-bites-dog story: A longtime Knobbe Martens partner is leaving the firm to join a competitor. Brent Babcock, the head of Knobbe's PTAB practice, has taken a similar position at Womble Bond Dickinson. My ALM colleague Xiumei Dong had the news Monday.

Knobbe is famous for hanging onto its homegrown talent. Indeed, Babcock had practiced at the firm for 26 years. He told me Tuesday he wanted the opportunity build a PTAB practice from scratch at a full-service firm. “I like to build stuff,” he said.

Babcock has represented clients in more than 130 PTAB proceedings. A sizable chunk was for Intellectual Ventures, though he said he won't be bringing that work with him to Womble. He'll be based out of Womble's Orange County office, and expects to handle roughly a 50-50 mix of petitioner and patent owner work.

Babcock said big general practice firms have been busy adding PTAB capability, especially since the Supreme Court rejected the Oil Statesconstitutional challenge to the America Invents Act last April.

“As we pitch cases, more and more of the time, the big general practice firms now have teams of IPR specialists,” he said.

Womble has made intellectual property a point of emphasis. About 20 percent of its 1,000 lawyers practice IP, and the firm recently acquired California IP boutique Blakely Sokoloff Taylor & Zafman. Unlike some big firms, Womble maintains a patent prosecution practice, an important consideration for Babcock. “You need that full bench strength to bring the technical expertise” that's needed in a PTAB proceeding, he said.

Knobbe's PTAB practice will remain in good hands, Babcock said. The firm recently appointed three practice co-chairs to oversee the hundreds of PTAB matters pending at the firm.

But, he said, “Womble is the right firm at the right time for me.”

Perkins Snags Ex-PTO Solicitor Nate Kelley

Perkins Coie has also made a big splash in the PTO practice space. Former PTO Solicitor Nate Kelley joined the firm this week. He brings experience running the PTO's litigation team, serving temporarily as chief judge of the PTAB, and previously working at the Federal Circuit as a staff attorney and law clerk.

“Nate is one of the foremost intellectual property lawyers in the country, and he is widely respected for his litigation experience and ability,” Shannon Bloodworth, co-chairwoman of Perkins Coie's IP practice, told my ALM colleague Scott Flaherty. “His deep knowledge of the USPTO and Federal Circuit will broaden and strengthen our nationally ranked team of IP litigators.”

Kelley oversaw the defense of hundreds of PTAB and Trademark Trial and Appeal Board rulings that wound up at the Federal Circuit on appeal. He also had a hand in guiding the PTO regulations, and counseled the office on implementation of the AIA. He stepped down from the PTO last summer.

Scout on Scout IP Crime

It's come to this: the Girl Scouts of the United States of America is suingthe Boy Scouts of America for trademark infringement and unfair competition. The two congressionally chartered organizations have been on a collision course since the Boy Scouts started using the name “the Scouts” and enrolling children of both genders.

According to the Girl Scouts' complaint, that move will “marginalize the Girl Scouts Movement by causing the public to believe that [the Girl Scouts'] extraordinarily successful services are not true or official 'Scouting' programs, but niche services with limited utility and appeal.”

My ALM colleague Colby Hamilton has details here. A Dorsey & Whitney and team headed by partner Bruce Ewing is representing the Girl Scouts.

That's all from Skilled in the Art today. I'll see you all again on Friday.