Storer v. Clark

This patent interference contest involves methods of treating hepatitis C by administering compounds having a specific chemical and stereochemical structure, based on the following foundation formula of a five-membered ring having the fluorine substituent in the 2´(down) position:

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Storer Br. at 8. The priority decision was based on enablement of this product. The interference was declared between an issued patent (Storer et al.) and a pending application (Clark), both of which were filed before the effective date of the America Invents Act, the statute that abolished the first-to-invent interference rule in favor of a first-to-file rule. By the terms of the Act, § 3(n)(2), the prior, first-to-invent, law applies to this interference.

To establish priority, Storer relied on the disclosure in the provisional specification from which priority was claimed for conception and constructive reduction to practice. In its joint decision on Clark’s motion to deny Storer the benefit of the provisional application and on Clark’s motion to invalidate Storer’s claims on the grounds of lack of enablement and written description,1 the Patent Trial and Appeal Board (PTAB or “Board”) held that Storer’s provisional application was not enabling for the count of the interference, and on that ground the PTAB entered judgment granting priority to Clark.2 Storer appeals that judgment and the underlying decision on Clark’s motions.

We take note that Storer initially filed in the District of Delaware, seeking review of the Board’s decision under 35 U.S.C. § 146. The district court dismissed the case, Idenix Pharmaceuticals. LLC v. Gilead Pharmasset LLC, 2016 WL 6804915, at *1 (D. Del. Nov. 16, 2016), based on this court’s ruling in Biogen MA, Inc. v. Japanese Foundation for Cancer Research, 785 F.3d 648 (Fed. Cir. 2015), that the America Invents Act eliminated the option of district court review under Section 146 for interferences declared after September 15, 2012. Although Storer says that Biogen was incorrectly decided, that decision is binding on this panel. Storer’s appeal of the district court’s dismissal has been stayed pending the outcome of this appeal. Order, Idenix Pharm. LLC v. Gilead Pharmasset LLC, No. 17-1369 (Fed. Cir. Feb. 16, 2017).

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Jordan-Benel v. Universal City Studios, Inc.

The panel affirmed the district court’s order denying defendants’ anti-SLAPP motion to strike a state law claim for breach of implied-in-fact contract in a copyright case.

The plaintiff alleged that the defendants infringed his copyright in a screenplay and used his screenplay idea to create films without providing him compensation as a writer. The panel held that the breach of contract claim did not arise from an act in furtherance of the right of free speech because the claim was based on defendants’ failure to pay for the use of plaintiff’s idea, not the creation, production, distribution, or content of the films. Accordingly, the district court did not err in denying defendants’ motion to strike the state law claim under California’s anti-SLAPP statute.

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Matal v. Tam

Simon Tam, lead singer of the rock group “The Slants,” chose this moniker in order to “reclaim” the term and drain its denigrating force as a derogatory term for Asian persons. Tam sought federal registration of the mark “THE SLANTS.” The Patent and Trademark Office (PTO) denied the application under a Lanham Act provision prohibiting the registration of trademarks that may “disparage . . . or bring . . . into contemp[t] or disrepute” any “persons, living or dead.” 15 U. S. C. §1052(a). Tam contested the denial of registration through the administrative appeals process, to no avail. He then took the case to federal court, where the en banc Federal Circuit ultimately found the disparagement clause facially unconstitutional under the First Amendment’s Free Speech Clause.

Held: The judgment is affirmed. 808 F. 3d 1321, affirmed.

JUSTICE ALITO delivered the opinion of the Court with respect to Parts I, II, and III–A, concluding:

1. The disparagement clause applies to marks that disparage the members of a racial or ethnic group. Tam’s view, that the clause applies only to natural or juristic persons, is refuted by the plain terms of the clause, which uses the word “persons.” A mark that disparages a “substantial” percentage of the members of a racial or ethnic group necessarily disparages many “persons,” namely, members of that group. Tam’s narrow reading also clashes with the breadth of the disparagement clause, which by its terms applies not just to “persons,” but also to “institutions” and “beliefs.” §1052(a). Had Congress wanted to confine the reach of the clause, it could have used the phrase “particular living individual,” which it used in neighboring §1052(c). Tam contends that his interpretation is supported by legislative history and by the PTO’s practice for many years of registering marks that plainly denigrated certain groups. But an inquiry into the meaning of the statute’s text ceases when, as here, “the statutory language is unambiguous and the statutory scheme is coherent and consistent.” Barnhart v. Sigmon Coal Co., 534 U. S. 438, 450 (internal quotation marks omitted). Even if resort to legislative history and early enforcement practice were appropriate, Tam has presented nothing showing a congressional intent to adopt his interpretation, and the PTO’s practice in the years following the disparagement clause’s enactment is unenlightening. Pp. 8–12.

2. The disparagement clause violates the First Amendment’s Free Speech Clause. Contrary to the Government’s contention, trademarks are private, not government speech. Because the “Free Speech Clause . . . does not regulate government speech,” Pleasant Grove City v. Summum, 555 U. S. 460, 467, the government is not required to maintain viewpoint neutrality on its own speech. This Court exercises great caution in extending its government-speech precedents, for if private speech could be passed off as government speech by simply affixing a government seal of approval, government could silence or muffle the expression of disfavored viewpoints.The Federal Government does not dream up the trademarks registered by the PTO. Except as required by §1052(a), an examiner may not reject a mark based on the viewpoint that it appears to express. If the mark meets the Lanham Act’s viewpoint-neutral requirements, registration is mandatory. And once a mark is registered, the PTO is not authorized to remove it from the register unless a party moves for cancellation, the registration expires, or the Federal Trade Commission initiates proceedings based on certain grounds. It is thus far fetched to suggest that the content of a registered mark is government speech, especially given the fact that if trademarks become government speech when they are registered, the Federal Government is babbling prodigiously and incoherently. And none of this Court’s government-speech cases supports the idea that registered trademarks are government speech. Johanns v. Livestock Marketing Assn., 544 U. S. 550; Pleasant Grove City v. Summum, 555 U. S. 460; and Walker v. Texas Div., Sons of Confederate Veterans, Inc., 576 U. S. ___, distinguished. Holding that the registration of a trademark converts the mark into government speech would constitute a huge and dangerous extension of the government-speech doctrine, for other systems of government registration (such as copyright) could easily be characterized in the same way. Pp. 12–18.

JUSTICE ALITO, joined by THE CHIEF JUSTICE, JUSTICE THOMAS, and JUSTICE BREYER, concluded in Parts III–B, III–C, and IV:

(a) The Government’s argument that this case is governed by the Court’s subsidized-speech cases is unpersuasive. Those cases all involved cash subsidies or their equivalent, e.g., funds to private parties for family planning services in Rust v. Sullivan, 500 U. S. 173, and cash grants to artists in National Endowment for Arts v. Finley, 524 U. S. 569. The federal registration of a trademark is nothing like these programs. The PTO does not pay money to parties seeking registration of a mark; it requires the payment of fees to file an application and to maintain the registration once it is granted. The Government responds that registration provides valuable non-monetary benefits traceable to the Government’s resources devoted to registering the marks, but nearly every government service requires the expenditure of government funds. This is true of services that benefit everyone, like police and fire protection, as well as services that are utilized by only some, e.g., the adjudication of private lawsuits and the use of public parks and highways. Pp. 18–20.

(b) Also unpersuasive is the Government’s claim that the disparagement clause is constitutional under a “government-program” doctrine, an argument which is based on a merger of this Court’s government-speech cases and subsidy cases. It points to two cases involving a public employer’s collection of union dues from its employees, Davenport v. Washington Ed. Assn., 551 U. S. 177, and Ysursa v. Pocatello Ed. Assn., 555 U. S. 353, but these cases occupy a special area of First Amendment case law that is far removed from the registration of trademarks. Cases in which government creates a limited public forum for private speech, thus allowing for some content- and speaker-based restrictions, see, e.g., Good News Club v. Milford Central School, 533 U. S. 98, 106–107; Rosenberger v. Rector and Visitors of Univ. of Va., 515 U. S. 819, 831, are potentially more analogous. But even in those cases, viewpoint discrimination is forbidden. The disparagement clause denies registration to any mark that is offensive to a substantial percentage of the members of any group. That is viewpoint discrimination in the sense relevant here: Giving offense is a viewpoint. The “public expression of ideas may not be prohibited merely because the ideas are themselves offensive to some of their hearers.” Street v. New York, 394 U. S. 576, 592. Pp. 20–23.

(c) The dispute between the parties over whether trademarks are commercial speech subject to the relaxed scrutiny outlined in Central Hudson Gas & Elect. v. Public Serv. Comm’n of N. Y., 447 U. S. 557, need not be resolved here because the disparagement clause cannot withstand even Central Hudson review. Under Central Hudson, a restriction of speech must serve “a substantial interest” and be “narrowly drawn.” Id., at 564–565 (internal quotation marks omitted). One purported interest is in preventing speech expressing ideas that offend, but that idea strikes at the heart of the First Amendment. The second interest asserted is protecting the orderly flow of commerce from disruption caused by trademarks that support invidious discrimination; but the clause, which reaches any trademark that disparages any person, group, or institution, is not narrowly drawn. Pp. 23–26.

JUSTICE KENNEDY, joined by JUSTICE GINSBURG, JUSTICE SOTOMAYOR, and JUSTICE KAGAN, agreed that 15 U. S. C. §1052(a) constitutes viewpoint discrimination, concluding:

(a) With few narrow exceptions, a fundamental principle of the First Amendment is that the government may not punish or suppress speech based on disapproval of the ideas or perspectives the speech conveys. See Rosenberger v. Rector and Visitors of Univ. of Va., 515 U. S. 819, 828–829. The test for viewpoint discrimination is whether—within the relevant subject category—the government has singled out a subset of messages for disfavor based on the views expressed. Here, the disparagement clause identifies the relevant subject as “persons, living or dead, institutions, beliefs, or national symbols,” §1052(a); and within that category, an applicant may register a positive or benign mark but not a derogatory one. The law thus reflects the Government’s disapproval of a subset of messages it finds offensive, the essence of viewpoint discrimination. The Government’s arguments in defense of the statute are unpersuasive. Pp. 2–5.

(b) Regardless of whether trademarks are commercial speech, the viewpoint based discrimination here necessarily invokes heightened scrutiny. See Sorrell v. IMS Health Inc., 564 U. S. 552, 566. To the extent trademarks qualify as commercial speech, they are an example of why that category does not serve as a blanket exemption from the First Amendment’s requirement of viewpoint neutrality. In the realm of trademarks, the metaphorical marketplace of ideas becomes a tangible, powerful reality. To permit viewpoint discrimination in this context is to permit Government censorship. Pp. 5–7.

ALITO, J., announced the judgment of the Court and delivered the opinion of the Court with respect to Parts I, II, and III–A, in which ROBERTS, C. J., and KENNEDY, GINSBURG, BREYER, SOTOMAYOR, and KAGAN, JJ., joined, and in which THOMAS, J., joined except for Part II, and an opinion with respect to Parts III–B, III–C, and IV, in which ROBERTS, C. J., and THOMAS and BREYER, JJ., joined. KENNEDY, J., filed an opinion concurring in part and concurring in the judgment, in which GINSBURG, SOTOMAYOR, and KAGAN, JJ., joined. THOMAS, J., filed an opinion concurring in part and concurring in the judgment. GORSUCH, J., took no part in the consideration or decision of the case.

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Outdry Technologies Corp. v. Geox S.P.A.

Outdry Technologies Corp. (“Outdry”) appeals from the Patent Trial and Appeal Board’s (“Board”) inter partes review decision holding that claims 1–15 of U.S. Patent No. 6,855,171 (“the ’171 patent”) would have been obvious over a combination of prior art. For the reasons discussed below, we affirm.

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Cleveland Clinic Foundation v. True Health Diagnostics. LLC

The Cleveland Clinic Foundation and Cleveland Heartlab, Inc. accused True Health Diagnostics LLC of infringement of three patents that claim methods for testing for myeloperoxidase in a bodily sample and a fourth patent that claims a method for treating a patient that has cardiovascular disease. The United States District Court for the Northern District of Ohio found that the asserted claims of the three testing patents are not directed to patent-eligible subject matter and that Cleveland Clinic failed to state a claim of contributory or induced infringement of the fourth patent. For the reasons explained below, we affirm.

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