From the patenting-the-internet-is-not-a-good-idea department – Ultramercial decision goes back to the CAFC

by | May 1, 2013 | Advertising, Infotech, Intellectual Property, Litigation, Patents, Uncategorized

We have all seen them – the short clips of video advertising we must watch before we are granted access to some other video content.  A company known as Ultramercial claims that the “idea” of putting that short advertising clip in front of content was its novel, non obvious and hence patentable invention.   A lower court disagreed, and invalidated the patent on subject matter grounds.  Last September, however, in Ultramercial v Hulu, the Court of Appeals for the Federal Circuit reversed that decision and remanded the decision for further proceedings (the issue of whether the patent was even valid on novelty or non obvious grounds had not yet been decided).

On May 21, 2012 the Supreme Court of the United States granted certiorari and remanded the case back to the CAFC for further review in light of Mayo Collaborative Services v. Prometheus Laboratories, Inc., a decision in which the process and method of administering certain therapeutic drugs was held to be patent subject matter ineligible.

There has been a distinct level of Supreme Court review of patent cases recently, most of them restricting or limiting the validity and subject matter of patents.  This latest remand indicates that the Supreme Court is expecting the CAFC to use these decisions in the internet area as well, to begin at least reviewing, and most likely holding invalid, many business method type patents that do not meet patent eligible subject matter requirements.

There are thousands of issued patents that cover basic functioning of the internet system (or, at least the commercial part of it) – that will be called into question in light of these recent Supreme Court decisions.

For more information, contact Mike Oliver.

Verizon subscribers safe after patent close call, will cost them in the long run

by | May 1, 2013 | Case law, Intellectual Property, Litigation, Patents, Uncategorized

In ACTIVEVIDEO NETWORKS, INC. v. VERIZON COMMUNICATIONS, INC., case available here Verizon mostly lost its appeal after a jury awarded the plaintiff substantial damages related to infringement of patents plaintiff held on video on demand services. The trial court also had awarded a permanent injunction against Verizon, which had it been upheld, Verizon would have had to remove VOD services for its subscribers. However, the appeal court held that a permanent injunction was not justified, primarily because money damages would be sufficient (the plaintiff had previously negotiated with another provider and licensed its patents).

Even though the injunction was overturned, Verizon will end up paying a significant per subscriber amount for the license, on the order of 20 times the royalty rate negotiated with a prior licensee.

This case contains a very good analysis of many issues that are presented in patent trials ( which themselves are rare) including marking, hypothetical negotiation, and the requirements of expert testimony. Indeed, Verizon lost much of the case because most of its expert testimony was excluded because it was conclusory.

For more information, contact Mike Oliver.