course materials - penn law materials part 1 [this page ... with patent law. [fed cir digest, ......

University of Pennsylvania Law School

Intellectual Property:Patent Law

Law 677 | Spring 2001Professor Wagner

CCOOUURRSSEEMMAATTEERRIIAALLSS

Part 1

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Patents

A Historical Perspective

Frank P. Porcelli

Fish & Richardson P.C.Boston, Massachusetts

John A. Dragseth

Fish & Richardson P.C., P.A.

Minneapolis, Minnesota

Ver. 0.4a

Copyright 1999,, 2000, 2001 by John A. Dragseth and Frank P. Porcelli

Modifications by R. Polk Wagner, 2001.

University of Pennsylvania Law School 2001

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AcknowledgementsThe authors would like to acknowledge the assistance they have received from the casebook,Cases and Materials on Information Property: Unfair Competition, Copyright, and Patent,originally developed in the late-1960s at Harvard Law School by William W. Rymer and DavidWestfall.

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Table of Contents

I

Introduction

Chapter 1: Introduction to Patents ................................................................1

Chapter 2: The Edges of Patent Law .........................................................19

II

Requirements for Patentability

Chapter 3 Novelty & Statutory Bars............................................................47

Chapter 4: Nonobviousness......................................................................133

Chapter 5: Statutory Subject Matter & Practical Utility.............................195

Chapter 6: The Patent Document .............................................................247

III

Patent Scope and Enforcement

Chapter 7: Claim Construction...................................................................tbd

Chapter 8: Doctrine of Equivalents Infringement ......................................tbd

Chapter 9: Dimensions of Patent Coverage..............................................tbd

Chapter 10: Defenses and Counterclaims ................................................tbd

Chapter 11: Remedies ...............................................................................tbd

IV

Other Issues

Chapter 12: Post-Issuance Activities.........................................................tbd

Chapter 13: Design Patents.......................................................................tbd

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BibliographyAn expansion in research and reference materials has accompanied the increased attention onpatent law in the past two decades. Some of the most important materials are:

Treatises

Donald S. Chisum, Chisum on Patents. This is the premiere modern treatise on patent law.Consuming __ volumes, the treatise provides thorough historical review of most issues dealingwith patent law. [fed cir digest, both hard and soft]

Dellers Walker on Patents:

Robinson

Texts

Chisum et al.

Adelman et al.

Merges

Books

Robert Harmon, Patents and the Federal Circuit.

_____, Biotechnology and the Federal Circuit

Periodicals

Harvard Journal of Law and Technology (JOLT):

IDEA: ____:

Journal of the Patent & Trademark Office Society (JPTOS):

Berkleys Journal:______

Franklin Pierce: ______

John Marshall in Chicago: _____

Section I

Int roduction

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Chapter 1 Introduction to Patents 1

Chapter 1

Introduction to PatentsWhat is a patent?

U.S. patents are creatures of federal statute. The federal patent laws are located in Title 35 of theUnited States Code. Congress enacted the patent laws under the Intellectual Property Clause, Art. I, 8, clause 8, of the Constitution, granting Congress the power:

To promote the progress of science and useful arts, by securing for limited times to authors andinventors the exclusive right to their respective writings and discoveries

Under the current law, a patent is a grant from the federal government that permits the patent owner (orpatentee) to exclude others from making, using, offering to sell, or selling in the United States (orimporting into the United States) anything covered by the claims of the patent, during the patents term.

Each part of this definition is important:

Grant from the federal government: There is no common law patent right. Rather, the right iscreated by federal statute, authorized by the Constitution. The federal patent statute preempts stateattempts to provide patent-like protection.

Permits the patent owner: The inventor is the original owner of her invention, and a patent must beapplied for in her name. However, the inventor can transfer her ownership in a patent application or ina patent by assigning her rights. Inventors commonly have contractual obligations to assign their rights


in their inventions to their employers. A patent is a piece of property, and may be transferred, sold,assigned, or licensed, to a new owner.

To exclude others: A United States patent does not give its owner the right to make, use, or sell thepatented article. Rather, the patent right is exclusionary, i.e., it gives its owner only the right to excludeothers. Although this distinction may seem very fine and has been overlooked even in books by judgesand seasoned practitioners, it is, nevertheless, an important distinction.

As an example, assume that Jack holds a patent on a certain asthma drug, and Jill later receives apatent on an improvement for administering the drug. Jack can prevent Jill from practicing herinvention until his patent expires (because her patent only gives her the right to exclude) and Jill canprevent Jack from using the improved administration method, but cannot prevent him from using othermethods. Until Jacks patent expires, he is in the better position because he can at least sell the drug.However, once Jacks patent expires, anyone (including Jill) can sell the drug, and Jill can do so moreeffectively than anyone else (including Jack) by asserting her patent. Thus, during the window of timebetween the expiration of Jacks patent and the expiration of Jills patent, Jill could wipe Jack out. Whathappens in this situation in the real world? Jack recognizes early that he needs Jill, and Jill recognizesthat her patent is slowly expiring with no commercial benefit until Jacks patent expires. Therefore, Jackand Jill will often enter into a cross-license, by which each promises not to sue the other for patentinfringement. Jack and Jill will live happily ever after as the sole suppliers of the drug using theimproved method, assuming their cross-license doesnt run afoul of the antitrust laws.

From making, using, selling, or offering to sell in the U.S. (or importing into the U.S.): The lastpart of this phrase (in the U.S.) is the simplest; the United States patent laws may not reach outsidethe United States*, but they may block infringing goods at the border. The rest of the phrase alsoseems pretty straightforward, but it has some tricky wrinkles. Making/using/selling/offering seems tocover about anything you could do with an infringing product or process. However, problems can arisewhen a party possesses a product but does not make, use, or sell it. In addition, where a patent coversa process, one party may make a product for performing the process and sell the product to anotherparty that uses the process (for example, computer software). If the seller sells the product (a CD-ROM) but does not make, use, or sell the process, it is not liable for direct infringement. It could,however, be liable for two forms of indirect infringement: active inducement and contributoryinfringement. We will discuss later how these two forms of infringement can be much harder to provethan direct infringement.

Anything covered by the claims of the patent: You will see a patent later. What is important now isthat you understand that the claims, which are the numbered sentences at the very back of the patent,are what define the property right (i.e., the right to exclude). All of the pictures and the other text in apatent are simply there to help the reader understand the invention and to help the reader (includingcourts, attorneys, and competitors of the patentee) understand the words in the claims. For example, asimple claim for a toy could read:

I claim an improved childrens toy, comprising a coil spring, whereby the toy slinks down multiple non-coplanar surfaces of varying height when a horizontal motive force is applied to said spring.

Assume that the patents written description (the main text of a patent) shows and describes a Slinkytoy, and assume an accused infringer makes a pogo stick. The question of infringement focuses onthe claim and whether the stick is covered by the claim. The stick probably comprises a spring(among other things), and thus meets that limitation of the claim, even though the spring in the sticklooks very different than the Slinky toy spring shown in the patent. However, the stick probably doesnot slink down stairs (either alone or in pairs). The coined word slink appears in a dictionary, but notwith the specific definition intended here, so the reader must go to the written description to find a

* There is even an exception to this rule, in that export of components to be assembled into an infringing product abroad isconsidered U.S. patent infringement under the current system.


special definition of that term. Presumably, the definition would require some sort of end-over-endmotion. The pogo stick would not meet the slink limitation in the claim. Therefore, you can see thatsome parts of an accused product may meet the claim limitations even if they do not match theembodiment of the invention shown in the written description. On the other hand, the writtendescription can give meaning to the words in the claim that may not be apparent from the four cornersof the claim. You will see more about this later, but if you enjoyed the old contract interpretation disputeover parol evidence and the four corners of the document, youll be ecstatic when we get to claimconstruction.

During the patents term: A patent is a temporal right; the Constitution speaks of securing rights forlimited times. For patents filed today, the patent term generally runs from the day the patent issuesuntil 20 years after the patent application was filed. Older patents (i.e., those filed before 1995) haveterms that run 17 years from issue. The change in the law was made in part to harmonize U.S. patentlaw with the rest of the world, and, because most patents take 2 or 3 years to issue, the change isgenerally a wash. However, by starting the term at filing, the new law discourages patent applicantsfrom using Patent & Trademark Office procedures to delay the issuance of a patent in hopes thatpotential infringers will expand their infringing activities and thus provide greater gains for the patenteewhen the patent ultimately issues (so-called submarine patents). Under the old law, some patentsoriginally filed in the 1950s and 1960s finally issued in the 1980s and 1990s, directed to such mature(and large) industries as bar-code scanners and lasers.

A Brief History

The roots of patent law reach back at least as far as Aristotle, who mentioned, in Politics, a lawproposed by Hippodamus of Miletus, to the effect that all who made discoveries advantageous to theircountry should receive honours. Aristotle recognized that Hippodamuss idea sounded appealing, buthe nevertheless condemned it as inviting harassments, presumably from assertion of rights over newideas in the political and social arenas, rather than in technology. In this conflict, we can begin to seethe tension between reward to an individual and the good of society. Although both Hippodamus andAristotle certainly have the good of society in mind, they approach the subject from different directions.Hippodamus sees the good that innovators may bring to society, while Aristotle sees the damage thatinnovators (or charlatans presented as innovators) can do to society. The idea of a patent systemnever really caught on with the ancient Greeks and Romans. Furthermore, the Middle Ages aregenerally viewed as a period in which there was little interest in innovation, and technology did notadvance a great deal.

Although patents were granted sporadically in the fourteenth century, a genuine system to grantrewards for innovation was not developed until late in the fifteenth century, in Venice. The new thinkingbrought on by the Renaissance eventually resulted in an Act of 1747 by the Venetian Senate:

We have among us men of great genius, apt to invent and discover ingenious devices; and in view ofthe grandeur and virtue of our city, more such men come to us every day from diverse parts. Now, ifprovision were made for the works and devices discovered by such persons, so that others who maysee them could not build them and take the inventors honour away, more men would then apply theirgenius, would discover, and would build devices of great utility and benefit to our commonwealth.Therefore:

Be it enacted that, by the authority of this Council, every person who shall build any new and ingeniousdevice in this city, not previously made in our Commonwealth, shall give notice of it to the office of ourGeneral Welfare Board when it has been reduced to the perfection so that it can be used and operated.It being forbidden to every other person in any of our territories and towns to make any further deviceconforming with and similar to said one, without the consent and license of the author, for the term of 10years. And if anybody builds it in violation hereof, the aforesaid author and inventor shall be entitled to


have him summoned before any magistrate of this City, by which magistrate the said infringer shall beconstrained to pay him hundred ducats; and the device shall be destroyed at once. It being, however,within the power and discretion of the Government, in its activities, to take and use any such device andinstrument, with this condition however that no one but the author shall operate it.

What is amazing about this law is its great similarity to most modern patent laws. The law includesrequirements that the invention be a new (35 U.S.C. 102) and ingenious (see 103) device (see 101), and that the inventor give notice of the invention so that it can be used and operated (see 112).The law provides for registration with an administrative agency and for bringing an infringement suit (271), with the ability to recover damages ( 284) and to receive an injunction, i.e., destruction ( 283).The single important difference with current U.S. patent law is that the Venetian act is inclusionaryrather than exclusionary, i.e., the inventor may practice his invention and exclude others from practicingit. The most important point to note about the Venetian act is its provision of a quid pro quo: theinventor receives his rights in exchange for disclosing the invention to the public so that it may be freelyused and operated after a limited period (here, 10 years). The Act recognizes the benefit to societyfrom this exchange, i.e., it will result in even more and greater inventions that will benefit society.

With the opening of trade in Europe, Venices idea spread as Venetian craftsmen traveled about, doingtheir work. Soon, patent systems had sprung up in Germany, France, and England. Patent grantsbegan in England as grants of importation franchises and monopolistic privileges. The system wasmeant largely to encourage skilled artisans to introduce technologies from the mainland onto theislands. However, the Crown (Elizabeth I) abused the practice of granting patents by giving privilegesto its favorites (whether or not they had developed anything new), and the Queens Bench ultimatelydeclared that monopolies violated the common law.

After further abuses by James I, Parliament enacted the Statute of Monopolies of 1623, which declaredall exclusive grants of privileges void and contrary to law, with an important exception, Section VI:

[B]e it declared and enacted, that any declaration before mentioned shall not extend to any LettersPatents and grants of privilege for the term of 14 years or under hereafter to be made of the soleworking or making of any manner of new manufacture within this Realm to the true and first inventorand inventors of such manufactures which others at the time of making such letters Patents and Grantsshall not use so as also they be not contrary to law nor mischievous to the State, by raising prices ofcommodities at home, or hurt of trade, or generally inconvenient.

Although the Statute of Monopolies is greatly revered, one can see that it took 150 years just to getback to a system that differs more from modern patent laws than did the Venetian system. Even withthis statute, the English patent system did not see much growth in patent development until theIndustrial Revolution. The key contribution made by England to general patent law was therequirement that a patent applicant describe his or her invention clearly and completely. In 1778, LordMansfield held, in Liardet v. Johnson, that the written patent specification, rather than the introduction ofa new industry into the country, was the consideration that the inventor gave in return for the patentgrant.

The English experience hopped the pond to the developing American colonies. Most of the thirteencolonies granted state patents, led by Massachusetts in 1641. Ultimately, interstate conflicts resulted inthe need for a uniform system of patents and copyrights. The provision now found at Article I, Section8, Clause 8, of the Constitution was proposed on September 5, 1787, near the close of theConstitutional Convention, and passed unanimously without debate.

The first Patent Act was passed soon thereafter in May 1790, the early days of the first Congress. Thefirst Act established a board, rather than a full patent office, to examine patent applications. The boardwas made up of the Secretary of State (Thomas Jefferson), the Attorney General (Edmund Randolph),and the Secretary of War (Henry Knox). The first patent was granted under this Act to SamuelHopkins, for an improved method of making potash.


A new Patent Act was passed in 1793 to relieve the board of its growing examination duties. Under the1793 Act, the board was replaced with a clerical registration system. Although the registration systemwas open to abuse because the government did not scrutinize applications before granting patents, thesystem lasted until 1836. In that year, Congress enacted new provisions that required that applicationsbe examined to determine whether they met novelty and utility requirements (i.e., the invention had tobe new and useful). In 1850, the Supreme Court added, in Hotchkiss v. Greenwood, a requirementthat an invention be nonobvious in light of inventions that had come before. The utility, novelty, andnonbviousness requirements are now located in sections 101, 102, and 103, respectively of Title 35,although the current nonobviousness requirement is more elaborate than the one announced inHotchkiss.

Major changes were also made to the patent statute in 1870 and 1952. The 1870 Act changed littlefrom earlier laws, but it did place a greater emphasis on the patent claims and added a requirementthat a patentee distinctly define the invention.

The 1952 Act is the most recent overhaul of the patent laws, and it survives today with fewmodifications. The 1952 Act came amid a passion for patent-bashing on the Supreme Court, led byJustices Douglas and Black. The Supreme Courts negative attitude grew out of a more generalsuspicion at the time of big business and trusts. During the early part of the century, the Court hadlimited the manner in which claims could be drafted and had also raised the bar for patentability byinserting a flash of genius requirement for invention. The drafters of the 1952 Act, among them GilesSutherland Rich** and P.J. Federico, took advantage of changing attitudes after World War II, andcrafted a piece of legislation that was much more friendly to patentees. As one of their most importantand enduring contributions, they established the objective standard of nonobviousness in section 103as the key hurdle for patentability (superseding the flash of genius test).

Even after the 1952 Act, patent law still had its problems. Large differences existed among the regionalcircuit courts of appeals with regard to important issues of patent law. It is said that the Eighth Circuitdid not uphold a single patent for three decades leading into the 1980s, while other circuits were muchmore pro-patent. This lack of uniformity resulted in extreme forum shopping, as parties raced for acourthouse in a favorable circuit. As a result, industry generally did not take patents seriously and didnot count on patents as an important piece of business strategy.

However, in the 1970s, people began debating the need for a single appellate court to handle all patentappeals. In 1982, Congress passed the Federal Courts Improvement Act, forming the Court ofAppeals for the Federal Circuit (CAFC or Federal Circuit) as the nations thirteenth circuit. The court,located near the White House in Washington, D.C., has a diverse docket that includes internationaltrade and government contracts appeals, employment issues, takings cases, and all patent appeals,including those from district courts and those from the U.S. Patent & Trademark Office. See 28 U.S.C. 1295 (the Federal Circuit has exclusive jurisdiction over cases arising under any Act of Congressrelating to patents.). Because the Federal Circuit is the exclusive, nationwide patent appellate court,you will not see any post-1982 cases from any other circuit. In addition, although the Federal Circuitadopted as binding the precedent of its predecessor courts (the Court of Customs and Patent Appealsand the old Claims Court), it generally has ignored patent decisions by the other circuit courts ofappeals.

The Federal Circuit was ostensibly formed to bring uniformity to patent law, but it has also strengthenedthe patent law in other ways. The court has effectively expanded the use of juries in patent trials, andpractitioners have increasingly asked for juries after seeing jury awards of hundreds of millions of

** Remember this name. You will read many opinions by this man, who was appointed by Eisenhower, elevated to theCourt of Appeals for the Federal Circuit at its creation in 1982, and passed away in 1999 at 95 years of age, the oldestactive member of the federal judiciary. Until his death, Judge Rich worked full-time as an active (and outspoken) judge onthe court. He has had more influence on patent law in the 20th century than any other person.


dollars in other cases. Along with the increased protection of intellectual property rights given by theFederal Circuit, the economy has developed in ways that increasingly depend on protection of suchrights. For example, increased foreign trade has sometimes required enforcement of intellectualproperty rights to protect innovators, and new high-technology developments require greater up-frontresearch and development costs, but may be copied more easily than old brick-and-mortar products.There is an open and raging debate over whether the connection between the Federal Circuit and high-technology economic development is one of causation or simply of correlation. However, there is nodoubt that over the past two decades, patents have become increasingly important to both innovatorsand the people who provide funding to them.

Perhaps the good arguments in favor of the Federal Circuit can be tempered somewhat by thefollowing excerpt from an article by Judge Simon Rifkind, published in the American Bar AssociationJournal in 1951:

Periodically one hears the suggestion that patent cases should be tried before patent judges. Theproposals take a variety of forms but they all revolve about the proposition that the judicial product ofpatent litigation would be improved if the trials were conducted by judges specializing in patent cases.

I deny this pivotal proposition; consequently I am opposed to patent courts for patent judges.

The highly industrialized society in which we live has a great appetite for "know-how." Such a societyelevates and aggrandizes the position of the expert. His is the voice with the ready answer. Hisopinions become the facts upon which lesser mortals -- laymen -- risk life and fortune.

Against the citadel of the expert I tilt no quixotic lance. My contention is that the judicial process requiresa different kind of expertise -- the unique capacity to see things in their context. Great judges embracewithin their vision a remarkably ample context. But even lesser men, presiding in courts of widejurisdiction, are constantly exposed to pressures that tend to expand the ambit of their ken.

The patent law does not live in the seclusion and silence of a Trappist monastery. It is part and parcel ofthe whole body of our law. It ministers to a system of monopolies within a large competitive system.

This monopoly system is separated from the rest of the law not by a steel barrier but by a permeablemembrane constantly bathed in the general substantive and procedural law. Patent lawyers tend toforget that license agreements are essentially contracts subject to the law of contracts; thatinfringements are essentially trespasses subject to the law of torts; that patent rights are a species ofproperty rights; and that proof in patent litigation is subject to the laws of evidence. Changes in all thesebranches of the law today have an effect on the patent law as well. As long as judges exercising a widejurisdiction also try patent cases, so long do the winds of doctrine, the impulses towards slow changeand accommodation, affect the patent law to the same degree as they affect the general body of thelaw.

Judge Rifkind went on to argue that a specialized judiciary would lead to decadence in the law bygranting ownership of the patent law to a seclusive group of patent lawyers. In addition, he opined thatthere was little to be gained from a patent court because even specialized judges could have scientificknowledge in only a single narrow field and because consideration of an entire patent dispute oftenrequires familiarity with many other areas of law.

As you read decisions by the Federal Circuit in this book, ask yourself whether, or to what extent,Judge Rifkinds concerns have resulted. In fairness, it should be remembered that the Federal Circuitdoes hear many appeals in areas other than patent law, thereby answering one of Judge Rifkindsconcerns. In addition, relatively few of the judges on the Federal Circuit are patent attorneys. Also,patent trials in the district courts are still conducted by non-specialized federal district judges.Nevertheless, the issue of judicial specialization remains a discussion point, and some recentcommentaries have made criticisms that echo some of Judge Rifkinds concerns.


A Brief Explanation of Patent Practice

Since 1790, Congress has provided a system for inventors to apply for and receive U.S. patents.Although the system has evolved and become much more complicated over the last 200 years, manykey aspects have remained the same.

The process for obtaining patents has, for most of the past two centuries, been an examination processin which patent applicants mail in their "patent applications" with a fee, and in which governmentofficials (now called patent examiners) examine the "patent applications" to see if they meet therequirements of the patent statute. Patent applications generally follow a common form. First, anapplication has a title and an abstract that quickly describes the invention. It also contains a generaldescription of the technological area of the invention and a summary of the invention. The applicationthen describes the invention in detail. The application may be accompanied by drawings, if they arehelpful or necessary to an understanding of the invention; the drawings are generally labeled withnumbers that are referenced in the written description. The written portion of the patent, along with thedrawings, is referred to as the written description. The application ends with the claims. By rule, eachclaim must be a single sentence, so claims can often seem unwieldly. The claims are the focus of apatent because they define the scope of the invention; the written description is merely used for help indefining the claims. Together, the written description and the claims make up the specification.***

The inventor or inventors must apply for the patent, but they often assign their rights to their employer.They are also usually represented by a patent attorney (or patent agent) who is either employed by theassigned company or retained by it. The process of obtaining a patent is known as patentprosecution. A patent attorney is an attorney who has passed the Patent Bar exam, while a patentagent is a non-attorney with a technical background who has passed the Patent Bar exam. Only pro seapplicants and people who have passed the Patent Bar exam may prosecute patents.

The examination is conducted at the United States Patent & Trademark Office ("PTO"), currentlylocated in Arlington, Virginia. Specialized patent examiners assigned to specific technologies called"art groups" review incoming patent applications in their respective fields to determine whether theapplications meet the statutory requirements for patentability. They perform "prior art searches" bylooking for prior patents and publications (types of "prior art") that are related to the subject of theapplication to determine whether the claims of the application are "new" and "nonobvious" over thisprior art. They review the adequacy of the description in the patent application to see if it wouldenable a persons of ordinary skill in the relevant field to make and use the claimed invention. Theyalso review the claim language to make sure it is clear and definite. Each examiner then issues apreliminary decision on all of these matters (a "first office action"). The examiner may reject all of theclaims, allow all of the claims, allow some and reject others, or object to problems of form in thewritten description. It is also possible for the examiner, before making these substantive rulings, todetermine that separate inventions are contained in the patent application which should be divided intoadditional patent applications (so-called "restriction"), which results in additional application fees for thePTO and more examinations. The examiner generally communicates his actions by mail.

The applicant or attorney then has an opportunity to respond to the first office action, usually withinthree months. Before responding, the attorney may have an interview in person or by telephone withthe examiner to discuss the office action and present arguments why any rejection or objection should

*** As you read the materials in this book, you might notice that judges and others often incorrectly refer to the writtendescription as the specification. This is generally a harmless oversight. However, in some situations, it can createproblems. For example, a patent applicant cannot add new matter to a patent specification and still claim priority back tothe date the patent application was originally filed. However, because the claims are part of the specification, a patentapplicant might be able to point to an existing claim that contains the added matter, so that the applicant can argue that nonew matter was added to the specification, even though new matter was added to the written description.


be withdrawn. The attorney then files a written "response" to the office action. In addition toarguments, this response may contain proposed changes to the claims ("amendments") in an attemptto convince the examiner to withdraw the rejection. The response may also include sworn testimony inthe form of affidavits or declarations, for example, of experts to provide evidence to rebut the rejection.The ball is again in the examiner's court, who may withdraw the rejections and objections, repeat them,or even make the rejections "final." If the rejection is final, the applicant is not entitled to a furtherresponse as of right and must either file an appeal to the Board of Patent Appeals and Interferences(the "Board") which is made up of special examiners, or pay a fee and "refile" the patent application asa continuation or continuation-in-part application. However, the applicant may submit after-finalpapers or obtain an interview with the examiner to clear up any problems, but the examiner is notrequired to grant such requests.

If the applicant appeals to the Board and is successful, the examiner is directed to allow the claims, anda patent issues. If the appeal to the Board is unsuccessful, the applicant can appeal further or can"refile" the application. Further appeal can be to two different courts: appeal to the U.S. Court ofAppeals for the Federal Circuit ("Federal Circuit") in Washington or civil action filed in the U.S. DistrictCourt for the District of Columbia, whose judgment is then appealable to the Federal Circuit.

If the claims are finally allowed, whether directly by the examiner or after appeal, the PTO issues aformal document entitled "Notice of Allowance and Payment of Base Issue Fee," which requires that anissue fee be paid within a few months. If that is done, the PTO prints the patent, including the allowedclaims numbered sequentially and bearing the official seal. The PTO issues patents each Tuesday, innumerical sequence. The PTO has already issued over 5.8 million patents since 1790.

Once issued, patents are presumed valid, but must be enforced in federal court if there is aninfringement dispute. Jurisdiction over patent disputes is exclusive to the federal courts. Infringementdisputes between civil litigants must be brought in the appropriate federal district court in which venuelies and personal jurisdiction can be found over the defendant. Private parties may only bringinfringement suits against the government in the U.S. Court of Federal Claims (formerly the Court ofFederal Claims, and before that, the Claims Court) in Washington. Appeals from both types of actionsgo exclusively to the Federal Circuit, the sole appellate tribunal for patent actions.

Of course, all the above appeals were and are reviewable on certiorari to the Supreme Court. Beforethere were circuit courts of appeals and before the discretionary appeal by certiorari, the SupremeCourt heard many more patent appeals than it has in the last 50 years. Hence, there is a large body ofSupreme Court patent case law in the 19th century and early 20th century. Supreme Court patentdecisions were rare from 1950-1982, and also from 1982-1995, probably in part because the FederalCircuit exhibited a particular expertise in handling these complicated cases. However, it appears thatwith the decisions by the Court in Markman (1996), Warner-Jenkinson (1997), Pfaff (1998), Zurko(1999), and College Savings (____), the Court has taken a renewed interest in patents. The increasingimportance of intellectual property in the modern U.S. economy is no doubt one reason for this, butwhether the Court will continue to take patent cases at a high frequency remains to be seen.

There are actually several kinds of U.S. patents. The most important type and the one that has beendiscussed above and will be the focus of this book is the basic patent, called the "utility patent." Utilitypatents cover new and useful processes, machines, manufactures, or compositions of matter. Thisbook will also cover design patents, which consist essentially of a mechanical drawing, and are issuedfor ornamental designs, such as jewelry designs, automotive body parts, and tire treads. Other kinds ofpatents are plant patents (for asexually reproducing plants, such as potatoes) and plant varietyprotection certificates (for sexually reproducing plants).


Patent Policy

In general, patent law attempts to foster technological innovation and its dissemination to the public.Almost all policy debates regarding intellectual property, including patent law, revolve around anunderlying tension: the public must (it is assumed) give some sort of reward to innovators toencourage them to innovate, but the public must receive something in return for giving the reward. Inpatent law, the public gives to a person who has an idea that can clear certain hurdles a right to keepother people from practicing the invention covered by the patent for almost two decades. This right notonly is designed to spur innovation, but, more importantly, is designed to encourage others to invest inthe production and dissemination of innovative products and processes. In return, the inventor isrequired to give the public a technical document (the patent) that teaches the public how to practice thepatented invention. In this manner, the patent when issued becomes part of the technical literature sothat the public can make improvements on the invention and can even design around the patent (toavoid infringement). Upon expiration of the patent, the public is no longer excluded by the patent fromdoing what its claims cover, so that the invention is available for all to use, subject, however, to theclaims of other unexpired patents that may still prevent unfettered use of a particular product ormethod.

We are no better at arguing policy than are you, so we give you this statement from The PatentSystem and the Modern Economy:

Penicillin is a classic example of what may happen to an important scientific breakthrough in theabsence of sufficient incentives for its exploitation. Dr. Alexander Fleming of St. Mary's Hospital at theUniversity of London had discovered penicillin, ascertained its general properties, and published hisresults by 1928. He tried to interest others in pursuing the matter without success. For a decade thediscovery lay dormant. Fortunately for humanity Dr. Fleming continued to cultivate the mold during thisperiod so that it was available when the necessities of war stimulated research on its use and thedevelopment of effective production techniques that ultimately led to the commercially useful drug.

The experience of Fleming should be contrasted with that of a contemporary, Dr. Wallace Carothers.Carothers had, by 1927, developed a theory that certain polymers would -- after initial mechanicalstretching -- become tough elastic materials. DuPont employed Carothers to pursue this matter in 1927.In 1930, Dr. Julian Hill -- working at DuPont with Carothers -- experimentally demonstrated theCarothers' theory. From these theoretical beginnings the work continued to the production of $45 millionin nylon research and $196,800,000 in plants and facilities for nylon production (U.S. v. ImperialChemical Industries, 105 F. Supp. 215, 222 (S.D.N.Y. 1952)). And see Heckert, Synthetic Fibers, 30 J.Chem. Education 166 (1953).

Query: To what extent does the experience of Fleming, as distinguished from that of Carothers, reflectthe fact that until 1949 the British patent law did not provide for the patentability of chemical substances,such as penicillin?

Study of the Subcommittee on Patents, Trademarks, and Copyrights of the Committee on theJudiciary, United States Senate, Study No. 2 (84th Cong., 2d Sess.).

Inscribed over the entrance of the Department of Commerce building in Washington are the followingwords of a former president who also happened to be an inventor:

The patent system added the fuel of interest to the fire of genius.

--A. Lincoln

In Marconi Wireless Co. v. United States, 320 U.S. 1 (1943), Justice Frankfurter said, in a partialdissent:

For all I know, the basic assumption of our patent law may be false, and inventors and their financialbackers do not need the incentive of a limited monopoly to stimulate invention.


Has either Lincoln or Frankfurter been vindicated? Interestingly, Judge Jerome Frank, in a thought-provoking concurrence in Picard v. United Aircraft Corp., 128 F.2d 632 (2d Cir. 1942), suggested that itmight be better to grant patents tailored to encourage investment rather than invention: But if we neverneeded, or do not now need, patents as bait for inventors, we may still need them, in some instances,as a lure to investors. What is it that society and government should be encouraging, and how canthey do it most efficiently and fairly?

About This Book

This book is organized around the historical development of United States patent law. Its focus is moreon the rationales behind the core rules of patent law, rather than on the technical details of patent law.Most chapters contain Supreme Court opinions covering broad areas of patent law, followed by notesthat fill in the gaps with modern developments in the law. The book also contains many opinions by theHonorable Learned Hand. He authored dozens of patent opinions during his time as a district andappeals court judge, including many timeless works. Not only are the opinions in this book some of thebest written opinions, but they also avoid overwhelming the reader with technological complexity, aproblem with many modern opinions. Notes and discussions scattered throughout the book fill in themodern detail left open by the excerpted cases, so that the reader can learn how best to analyze patentlaw issues and also learn the details of patent law.

The book is organized into five parts. Chapters 1 and 2 provide an introduction to patents and indicatehow patent law interacts with other laws. Chapters 3-6 deal with the requirements for receiving apatent on an invention. In particular, the invention must be new, or novel (Chapter 3); it must havebeen nonobvious when it was invented, when measured against previous inventions (Chapter 4); itmust be a kind of invention that Congress has deemed patentable (Chapter 5); and it must be set out ina patent application that describes the invention well enough that others can practice it (Chapter 6).Later chapters cover patent claim interpretation (Chapter 7), infringement (Chapters 8 and 9), remediesavailable to a patentee (Chapter 10), and defenses and counterclaims available to an accused infringer(Chapter 11). The last three chapters cover more detailed and remote areas of patent law: reissueand reexamination of patents in the PTO, design and plant patents, and various procedural issue thatarise in patent litigation.

One Final Comment

No textbook would be complete without an explanation, in Chapter 1, of why the topic covered by thebook is critical to the future of humankind. We try not to disappoint. Patent law is a core component ofour modern economy. When properly implemented, patent laws encourage people to invest in newtechnology, with time or money, because they can expect that their innovations will be protected by thecourts from second-comers. Modern technologies, such as pharmaceuticals, medical devices, andcomputer software, require enormous up-front costs for research and development. At the same time,they can be duplicated easily. Thus, without some sort of protection, it is unlikely anyone would takethe risk of developing breakthrough ideas. Well-balanced patent laws also protect developers fromoverly broad allegations of patent infringement so that the inventive landscape is left open for fullinnovation in the future. Although one can debate whether the current law overprotects orunderprotects particular classes of inventions, it is generally accepted that some sort of protection isnecessary.

Patent law is also increasingly important to the attorney in general practice because of two convergingtrends. First, our economy is increasingly moving to high-technology areas, and legal work follows theeconomy. Patents traditionally have been linked to high-technology, so general practitioners


increasingly run into patent issues. At the same time, patent law has been moving toward thetraditional economy. In a series of recent decisions, the courts have expanded the scope of the kindsof inventions that may be patented beyond the tradtional class of machines and chemicals. At theleading edge of this expansion, the courts determined that man-made living organisms and computer-implemented processes (i.e., software) are patentable. While both of these categories fall within thetraditional high-technology category, the courts have also recently wiped out old prohibitions onpatenting business methods. As a result, financial services companies can receive patents onmethods of managing portfolios and other financial products and services. In addition, it appears that inlight of recent rulings, patents conceivably might be obtained on legal processes, for example, methodsof structuring a corporation or processes for handling finances to avoid tax liabilities. Thus, patents inthe fields of business and marketing (especially on the Internet) have begun to proliferate as patent lawmoves toward even the Ludditic attorney.

Addendum: U.S. Patent No. 6,139,035

We conclude this chapter by offering an example of what an issued United States Patent looks like.The patent in question is No. 6,139,035, entitled Brake Device for a Skate Cart, and was issued onOctober 31, 2000. (See patent document on following pages.) Review the patent document carefully,to get a feel for the content and structure of the document. Each section has specific purposes consider what those might be as you review the document. What parts do you think are the mostimportant? As the book progresses, well be discussing in detail the content and purpose of many ofthese sections of the patent document.


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Chapter 2 The Edges of Patent Law 19

Chapter 2

The Edges of Patent LawIntroduction

The patent law, of course, does not exist in a vacuum. Rather, it is surrounded by other pieces offederal and state legislation, and centuries of common law. Most important to the operation of thepatent laws are other laws and policies dealing with other areas of kindred intellectual property. Thismay (or may not) explain why a patent book leads off with a copyright case.

Mazer v. Stein347 U.S. 201, 100 USPQ 325 (1954)

MR. JUSTICE REED delivered the opinion of the Court.

This case involves the validity of copyrights obtained by respondents for statuettes of male andfemale dancing figures made of semivitreous china. The controversy centers around the fact thatalthough copyrighted as "works of art," the statuettes were intended for use and used as basesfor table lamps, with electric wiring, sockets and lamp shades attached.

Respondents are partners in the manufacture and sale of electric lamps. One of the respondentscreated original works of sculpture in the form of human figures by traditional clay-modeltechnique. From this model, a production mold for casting copies was made. The resultingstatuettes, without any lamp components added, were submitted by the respondents to theCopyright Office for registration as "works of art" or reproductions thereof under 5 (g) or (h) ofthe copyright law, and certificates of registration issued. . . . Thereafter, the statuettes were sold


in quantity throughout the country both as lamp bases and as statuettes. The sales in lamp formaccounted for all but an insignificant portion of respondents' sales.

* * * *

Petitioners, charged by the present complaint with infringement of respondents' copyrights ofreproductions of their works of art, seek here a reversal of the Court of Appeals decree upholdingthe copyrights. Petitioners in their petition for certiorari present a single question:

"Can statuettes be protected in the United States by copyright when the copyright applicantintended primarily to use the statuettes in the form of lamp bases to be made and sold in quantityand carried the intentions into effect?

"Stripped down to its essentials, the question presented is: Can a lamp manufacturer copyrighthis lamp bases?"

The first paragraph accurately summarizes the issue. The last gives it a quirk that unjustifiably,we think, broadens the controversy. The case requires an answer, not as to a manufacturer'sright to register a lamp base but as to an artist's right to copyright a work of art intended to bereproduced for lamp bases. . . .

[The Court first noted that, since 1870, the Copyright Act has explicitly provided protection forthree-dimensional works of art such as statues. It then summarized the Copyright Officespractice, since 1870, of permitting registration of works of art possessing utilitarian aspects.]

The successive acts, the legislative history of the 1909 Act and the practice of the CopyrightOffice unite to show that "works of art' and "reproductions of works of art" are terms that wereintended by Congress to include the authority to copyright these statuettes. Individual perceptionof the beautiful is too varied a power to permit a narrow or rigid concept of art. As a standard wecan hardly do better than the words of the present Regulation, 202.8, supra, naming the thingsthat appertain to the arts. They must be original, that is, the author's tangible expression of hisideas. Compare Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53, 59-60. Such expression,whether meticulously delineating the model or mental image or conveying the meaning bymodernistic form or color, is copyrightable. What cases there are confirm this coverage of thestatute.

The conclusion that the statues here in issue may be copyrighted goes far to solve the questionwhether their intended reproduction as lamp stands bars or invalidates their registration. Thisdepends solely on statutory interpretation. Congress may after publication protect by copyrightany writing of an author. Its statute creates the copyright. It did not exist at common law eventhough he had a property right in his unpublished work.

But petitioners assert that congressional enactment of the design patent laws should beinterpreted as denying protection to artistic articles embodied or reproduced in manufacturedarticles.

They say:

"Fundamentally and historically, the Copyright Office is the repository of what each claimantconsiders to be a cultural treasure, whereas the Patent Office is the repository of what eachapplicant considers to be evidence of the advance in industrial and technological fields."

Their argument is that design patents require the critical examination given patents to protect thepublic against monopoly. Attention is called to Gorham Co. v. White, 14 Wall. 511, interpretingthe design patent law of 1842, 5 Stat. 544, granting a patent to anyone who by "their ownindustry, genius, efforts, and expense, may have invented or produced any new and originaldesign for a manufacture . . . ." A pattern for flat silver was there upheld. The intermediate andpresent law differs little. "Whoever invents any new, original and ornamental design for an articleof manufacture may obtain a patent therefor, . . . " subject generally to the provisions concerningpatents for invention. 171, 66 Stat. 805. As petitioner sees the effect of the design patent law:


"If an industrial designer can not satisfy the novelty requirements of the design patent laws, thenhis design as used on articles of manufacture can be copied by anyone."

Petitioner has furnished the Court a booklet of numerous design patents for statuettes, bases fortable lamps and similar articles for manufacture, quite indistinguishable in type from thecopyrighted statuettes here in issue. Petitioner urges that overlapping of patent and copyrightlegislation so as to give an author or inventor a choice between patents and copyrights should notbe permitted. We assume petitioner takes the position that protection for a statuette for industrialuse can only be obtained by patent, if any protection can be given.

As we have held the statuettes here involved copyrightable, we need not decide the question oftheir patentability. Though other courts have passed upon the issue as to whether allowance bythe election of the author or patentee of one bars a grant of the other, we do not. We do hold thatthe patentability of the statuettes, fitted as lamps or unfitted, does not bar copyright as works ofart. Neither the Copyright Statute nor any other says that because a thing is patentable it maynot be copyrighted. We should not so hold.

Unlike a patent, a copyright gives no exclusive right to the art disclosed; protection is given onlyto the expression of the ideanot the idea itself. Thus, in Baker v. Seldon, 101 U.S. 99, theCourt held that a copyrighted book on a peculiar system of bookkeeping was not infringed by asimilar book using a similar plan which achieved similar results where the alleged infringer madea different arrangement of the columns and used different headings. The distinction is illustratedin Fred Fisher, Inc. v. Dillingham, 298 F. 145, 151, when the court speaks of two men, each aperfectionist, independently making maps of the same territory. Though the maps are identical,each may obtain the exclusive right to make copies of his own particular map, and yet neither willinfringe the other's copyright. Likewise a copyrighted directory is not infringed by a similardirectory which is the product of independent work. The copyright protects originality rather thannovelty or inventionconferring only "the sole right of multiplying copies." Absent copying therecan be no infringement of copyright. Thus, respondents may not exclude others from usingstatuettes of human figures in table lamps; they may only prevent use of copies of their statuettesas such or as incorporated in some other article. Regulation 202.8, supra, makes clear thatartistic articles are protected in "form but not their mechanical or utilitarian aspects." See Stein v.Rosenthal, 103 F. Supp. 227, 231. The dichotomy of protection for the aesthetic is not beautyand utility but art for the copyright and the invention of original and ornamental design for designpatents. We find nothing in the copyright statute to support the argument that the intended use oruse in industry of an article eligible for copyright bars or invalidates its registration. We do notread such a limitation into the copyright law.

Nor do we think the subsequent registration of a work of art published as an element in amanufactured article, is a misuse of the copyright. This is not different from the registration of astatuette and its later embodiment in an industrial article.

"The copyright law, like the patent statutes, makes reward to the owner a secondaryconsideration." United States v. Paramount Pictures, 334 U.S. 131, 158. However, it is "intendeddefinitely to grant valuable, enforceable rights to authors, publishers, etc., without burden-somerequirements; `to afford greater encouragement to the production of literary [or artistic] works oflasting benefit to the world.'" Washingtonian Co. v. Pearson, 306 U.S. 30, 36.

The economic philosophy behind the clause empowering Congress to grant patents andcopyrights is the conviction that encouragement of individual effort by personal gain is the bestway to advance public welfare through the talents of authors and inventors in "Science andUseful Arts." Sacrificial days devoted to such creative activities deserve rewards commensuratewith the services rendered.

Affirmed.

Opinion of MR. JUSTICE DOUGLAS, in which MR. JUSTICE BLACK concurs.

* * * *


Questions, Comments, Problems1. The question left open by the Court in Mazer was answered in 1974 by the U.S. Court of Customs andPatent Appeals (CCPA), a predecessor court to the Federal Circuit, which heard appeals from the Patent Office(since renamed the Patent & Trademark Office). In In re Yardley, 493 F.2d 1389, 181 USPQ 331 (CCPA 1974),the CCPA had to decide whether an applicant could obtain a design patent on the ornamental appearance of aSpiro Agnew watch if he had already copyrighted the watch face (a caricature of former Vice-President Agnew).The CCPA held that the applicant was not barred from obtaining this second form of federal protection. The courtaddressed the constitutional and legislative issue as follows:

We agree with the [patent] boards view that the framers of the Constitution recognized a distinctionbetween authors and inventors and writings and discoveries. But, we do not think that theconstitutional provision requires an election. . . . Congress has not required an author-inventor to electbetween the two modes which it has provided for securing exclusive rights on the type of subject matterhere involved. If anything, the concurrent availability of both modes of securing exclusive rights aids inachieving the stated purpose of the constitutional provision.

Copyrights last far longer than design patents. At the time of this decision, copyrights lasted twenty-eight yearsfrom first publication, once renewable for a term of the same length, while design patents had, and still have, amaximum term of 14 years (35 U.S.C. 173). So, what rights does the public actually receive when the SpiroWatchs design patent expires if it is still protected by copyright? Does the public interest compel an election ofrights here, or do you agree with the conclusion in Yardley? For another important analysis of the significance ofpatent expiration, read the following story of a battle over a famous cereal.

Kellogg Co. v. National Biscuit Co.305 U.S. 111 (1938)

Mr. Justice BRANDEIS delivered the opinion of the Court.

This suit was brought in the federal court for Delaware by National Biscuit Company against KelloggCompany to enjoin alleged unfair competition by the manufacture and sale of the breakfast foodcommonly known as shredded wheat. The competition was alleged to be unfair mainly becauseKellogg Company uses, like the plaintiff, the name shredded wheat and, like the plaintiff, produces itsbiscuit in pillow-shaped form.

Shredded wheat is a product composed of whole wheat which has been boiled, partially dried, thendrawn or pressed out into thin shreds and baked. The shredded wheat biscuit generally known ispillow-shaped in form. It was introduced in 1893 by Henry D. Perky, of Colorado; and he wasconnected until his death in 1908 with companies formed to make and market the article. Commercialsuccess was not attained until the Natural Food Company built, in 1901, a large factory at NiagaraFalls, New York. In 1908, its corporate name was changed to 'The Shredded Wheat Company'; and in1930 its business and goodwill were acquired by National Biscuit Company.

Kellogg Company has been in the business of manufacturing breakfast food cereals since itsorganization in 1905. For a period commencing in 1912 and ending in 1919 it made a product whoseform was somewhat like the product in question, but whose manufacture was different, the wheat beingreduced to a dough before being pressed into shreds. For a short period in 1922 it manufactured thearticle in question. In 1927, it resumed manufacturing the product. In 1928, the plaintiff sued foralleged unfair competition two dealers in Kellogg shredded wheat biscuits. That suit was discontinuedby stipulation in 1930. On June 11, 1932, the present suit was brought. Much evidence wasintroduced; but the determinative facts are relatively few; and as to most of these there is no conflict.

In 1935, the District Court dismissed the bill. It found that the name 'Shredded Wheat' is a termdescribing alike the product of the plaintiff and of the defendant; and that no passing off or deceptionhad been shown. It held that upon the expiration of the Perky patent No. 548,086 issued October 15,1895, the name of the patented article passed into the public domain. In 1936, the Circuit Court of


Appeals affirmed that decree. Upon rehearing, it vacated, in 1937, its own decree and reversed that ofthe District Court, with direction 'to enter a decree enjoining the defendant from the use of the name'Shredded Wheat' as its trade-name and from advertising or offering for sale its product in the form andshape of plaintiff's biscuit in violation of its trade-mark; and with further directions to order an accountingfor damages and profits.' In its opinion the court described the trade-mark as 'consisting of a dish,containing two biscuits submerged in milk'. 3 Cir., 91 F.2d 150, 152, 155. We denied KelloggCompany's petition for a writ of certiorari, 302 U.S. 733, and denied rehearing 302 U.S. 777.

On January 5, 1938, the District Court entered its mandate in the exact language of the order of theCircuit Court of Appeals, and issued a permanent injunction. Shortly thereafter National BiscuitCompany petitioned the Circuit Court of Appeals to recall its mandate 'for purposes of clarification.' Italleged that Kellogg Company was insisting, contrary to the court's intention, that the effect of themandate and writ of injunction was to forbid it from selling its product only when the trade name'Shredded Wheat' is applied to a biscuit in the form and shape of the plaintiff's biscuit and isaccompanied by a representation of a dish with biscuits in in; and that it was not enjoined from makingits biscuit in the form and shape of the plaintiff's biscuit, nor from calling it 'Shredded Wheat,' unless atthe same time it uses upon its cartons plaintiff's trade-mark consisting of a dish with two biscuits in it.On May 5, 1938, the Circuit Court of Appeals granted the petition for clarification and directed theDistrict Court to enter a decree enjoining Kellogg Company (3d Cir., 96 F.2d 873):

'(1) from the use of the name 'SHREDDED WHEAT' as its trade name, (2) from advertising or offeringfor sale its product in the form and shape of plaintiff's biscuit, and (3) from doing either.'

Kellogg Company then filed a petition for a writ of certiorari to review the decree as so clarified, andalso sought reconsideration of our denial of its petition for certiorari to review the decree as entered inits original form. In support of these petitions it called to our attention the decision of the British PrivyCouncil in Canadian Shredded Wheat Co. v. Kellogg Company of Canada, 55 R.P.C. 125, renderedafter our denial of the petition for certiorari earlier in the term. We granted both petitions for certiorari.304 U.S. 586.

The plaintiff concedes that it does not possess the exclusive right to make shredded wheat. But itclaims the exclusive right to the trade name 'Shredded Wheat' and the exclusive right to makeshredded wheat biscuits pillow-shaped. It charges that the defendant, by using the name and shape,and otherwise, is passing off, or enabling others to pass off, Kellogg goods for those of the plaintiff.Kellogg Company denies that the plaintiff is entitled to the exclusive use of the name or of the pillow-shape; denies any passing off; asserts that it has used every reasonable effort to distinguish its productfrom that of the plaintiff; and contends that in honestly competing for a part of the market for shreddedwheat it is exercising the common right freely to manufacturer and sell an article of commerceunprotected by patent.

First. The plaintiff has no exclusive right to the use of the term 'Shredded Wheat' as a trade name. Forthat is the generic term of the article, which describes it with a fair degree of accuracy; and is the termby which the biscuit in pillow-shaped form is generally known by the public. Since the term is generic,the original maker of the product acquired no exclusive right to use it. As Kellogg Company had theright to make the article, it had, also, the right to use the term by which the public knows it. CompareSaxlehner v. Wagner, 216 U.S. 375; Holzapfel's Compositions Co. v. Rahtjen's American CompositionCo., 183 U.S. 1. . . .

Moreover, the name 'Shredded Wheat', as well as the product, the process and the machineryemployed in making it, has been dedicated to the public. The basic patent for the product and for theprocess of making it, and many other patents for special machinery to be used in making the article,issued to Perky. In those patents the term 'shredded' is repeatedly used as descriptive of the product.The basic patent expired October 15, 1912; the others soon after. Since during the life of the patents'Shredded Wheat' was the general designation of the patented product, there passed to the public uponthe expiration of the patent, not only the right to make the article as it was made during the patent


period, but also the right to apply thereto the name by which it had become known. As was said inSinger Mfg. Co. v. June Mfg. Co., 163 U.S. 169, 185:

'It equally follows from the cessation of the monopoly and the falling of the patented device into thedomain of things public that along with the public ownership of the device there must also necessarilypass to the public the generic designation of the thing which has arisen during the monopoly. . . .' Tosay otherwise would be to hold that, although the public had acquired the device covered by the patent,yet the owner of the patent or the manufacturer of the patented thing had retained the designated namewhich was essentially necessary to vest the public with the full enjoyment of that which had becometheirs by the disappearance of the monopoly.'

It is contended that the plaintiff has the exclusive right to the name 'Shredded Wheat', because thosewords acquired the 'secondary meaning' of shredded wheat made at Niagara Falls by the plaintiff'spredecessor. There is no basis here for applying the doctrine of secondary meaning. The evidenceshows only that due to the long period in which the plaintiff or its predecessor was the onlymanufacturer of the product, many people have come to associate the product, and as a consequencethe name by which the product is generally known, with the plaintiff's factory at Niagara Falls. But toestablish a trade name in the term 'shredded wheat' the plaintiff must show more than a subordinatemeaning which applies to it. It must show that the primary significance of the term in the minds of theconsuming public is not the product but the producer. This it has not done. The showing which it hasmade does not entitle it to the exclusive use of the term shredded wheat but merely entitles it to requirethat the defendant use reasonable care to inform the public of the source of its product.

* * * *

Second. The plaintiff has not the exclusive right to sell shredded wheat in the form of a pillow-shapedbiscuitthe form in which the article became known to the public. That is the form in which shreddedwheat was made under the basic patent. The patented machines used were designed to produce onlythe pillow-shaped biscuits. And a design patent was taken out to cover the pillow-shaped form. Hence,upon expiration of the patents the form, as well as the name, was dedicated to the public. As was saidin Singer Mfg. Co. v. June Mfg. Co., supra, page 185:

'It is self-evident that on the expiration of a patent the monopoly granted by it ceasesto exist, and the right to make the thing formerly covered by the patent becomespublic property. It is upon this condition that the patent is granted. It follows, as amatter of course, that on the termination of the patent there passes to the public theright to make the machine in the form in which it was constructed during the patent.We may therefore dismiss without further comment the complaint, as to the form inwhich the defendant made his machines.'

Where an article may be manufactured by all, a particular manufacturer can no more assert exclusiverights in a form in which the public has become accustomed to see the article and which, in the mindsof the public, is primarily associated with the article rather than a particular producer, than it can in thecase of a name with similar connections in the public mind. Kellogg Company was free to use thepillow-shaped form, subject only to the obligation to identify its product lest it be mistaken for that of theplaintiff.

* * * *

It is urged that all possibility of deception or confusion would be removed if Kellogg Company shouldrefrain from using the name 'Shredded Wheat' and adopt some form other than the pillow-shape. Butthe name and form are integral parts of the goodwill of the article. To share fully in the goodwill, it mustuse the name and the pillow-shape. And in the goodwill Kellogg Company is as free to share as theplaintiff. Compare William R. Warner & Co. v. Eli Lilly & Co., 265 U.S. 526, 528, 530. Moreover, thepillow-shape must be used for another reason. The evidence is persuasive that this form isfunctionalthat the cost of the biscuit would be increased and its high quality lessened if some otherform were substituted for the pillow-shape.


Kellogg Company is undoubtedly sharing in the goodwill of the article known as 'Shredded Wheat'; andthus is sharing in a market which was created by the skill and judgment of plaintiff's predecessor andhas been widely extended by vast expenditures in advertising persistently made. But that is not unfair.Sharing in the goodwill of an article unprotected by patent or trade-mark is the exercise of a rightpossessed by all-and in the free exercise of which the consuming public is deeply interested. There isno evidence of passing off or deception on the part of the Kellogg Company; and it has taken everyreasonable precaution to prevent confusion or the practice of deception in the sale of its product.

* * * *

Mr. Justice McREYNOLDS and Mr. Justice BUTLER are of opinion that the decree of the Circuit Courtof Appeals is correct and should be affirmed. To them it seems sufficiently clear that the KelloggCompany is fraudulently seeking to appropriate to itself the benefits of a goodwill built up at great costby the respondent and its predecessors.

Questions, Problems, Comments1. Consider the following passage from The Trade-Mark Cases, which held that Congress could not providefor federal trademark protection under the Intellectual Property clause:

The ordinary trade-mark has no necessary relation to invention or discovery. The trade-markrecognized by the common law is generally the growth of a considerable period of use, rather than asudden invention. It is often the result of accident rather than design, and when under the act ofCongress it is sought to establish it by registration, neither originality, invention, discovery, science, norart is in any way essential to the right conferred by that act. If we should endeavor to classify it underthe head of writings and authors, the objections are equally strong. . . . The writings which are to beprotected are the fruits of intellectual labor, embodied in the form of books, prints, engravings and thelike. The trade-mark may be, and generally is, the adoption of something already in existence as thedistinctive symbol of the party using it.

100 U.S. 82, 94 (1879). What does this passage tell us about the patent laws and the intent of the Constitutionregarding intellectual property rights? Should inventors who come across a discovery by accident rather thandesign be accorded almost 20 years of exclusivity?

2. The Kellogg court mentioned, but found unproven, the secondary meaning of the term shredded wheat.What about the biscuit shape? Could Nabisco have proven secondary meaning and thereby attained trademarkprotection on the shape of the biscuit? What proof would it have needed? Would trademark protection conflict withthe expiration of patent protection? The answer may depend on whether the trademark protection is under statelaw or federal law. Compare Compco Corp. v. Day-Brite Lighting, Inc., 376 U.S. 234, 140 USPQ 528 (1964)(holding that federal patent law preempts state unfair competition law when applied to protect an industrial designthat acquired secondary meaning when the design is in an expired design patent), with In re Mogen David WineCorp., 372 F.2d 539, 152 USPQ 593 (CCPA 1967) (concurring opinion by Judge Lane states, in dictum, thatCompco does not preclude obtaining federal trademark protection for a design (there, a wine decanter) that wasprotected by an expired design patent). This leads nicely to our next subjectpreemption of state laws by thefederal patent laws.

PREEMPTION OF STATE LAWS

Bonito Boats, Inc. v. Thunder Craft Boats, Inc.489 U.S. 141, 9 USPQ2d 1847 (1989)

JUSTICE O'CONNOR delivered the opinion of the Court.

We must decide today what limits the operation of the federal patent system places on the States'ability to offer substantial protection to utilitarian and design ideas which the patent laws leaveotherwise unprotected. In Interpart Corp. v. Italia, 777 F.2d 678 (1985), the Court of Appeals forthe Federal Circuit concluded that a California law prohibiting the use of the "direct molding


process" to duplicate unpatented articles posed no threat to the policies behind the federal patentlaws. In this case, the Florida Supreme Court came to a contrary conclusion. It struck down aFlorida statute which prohibits the use of the direct molding process to duplicate unpatented boathulls, finding that the protection offered by the Florida law conflicted with the balance struck byCongress in the federal patent statute between the encouragement of invention and freecompetition in unpatented ideas. See 515 So.2d 220 (1987). We granted certiorari to resolve theconflict, 486 U.S. 1004 (1988), and we now affirm the judgment of the Florida Supreme Court.

I

In September 1976, Petitioner Bonito Boats, Inc. (Bonito), a Florida corporation, developed a hulldesign for a fiberglass recreational boat which it marketed under the trade name Bonito BoatModel 5VBR. App. 5. Designing the boat hull required substantial effort on the part of Bonito. Aset of engineering drawings was prepared, from which a hardwood model was created. Thehardwood model was then sprayed with fiberglass to create a mold, which then served to producethe finished fiberglass boats for sale. The 5VBR was placed on the market sometime inSeptember 1976. There is no indication in the record that a patent application was ever filed forprotection of the utilitarian or design aspects of the hull, or for the process by which the hull wasmanufactured. The 5VBR was favorably received by the boating public, and "a broad interstatemarket" developed for its sale. Ibid.

In May 1983, after the Bonito 5VBR had been available to the public for over six years, theFlorida Legislature enacted Fla. Stat. 559.94 (1987). The statute makes "[i]t . . . unlawful forany person to use the direct molding process to duplicate for the purpose of sale anymanufactured vessel hull or component part of a vessel made by another without the writtenpermission of that other person." 559.94(2). The statute also makes it unlawful for a person to"knowingly sell a vessel hull or component part of a vessel duplicated in violation of subsection(2)." 559.94(3). Damages, injunctive relief, and attorney's fees are made available to "[a]nyperson who suffers injury or damage as the result of a violation" of the statute. 559.94(4). Thestatute was made applicable to vessel hulls or component parts duplicated through the use ofdirect molding after July 1, 1983. 559.94(5).

On December 21, 1984, Bonito filed this action in the Circuit Court of Orange County, Florida.The complaint alleged that respondent here, Thunder Craft Boats, Inc. (Thunder Craft), aTennessee corporation, had violated the Florida statute by using the direct molding process toduplicate the Bonito 5VBR fiberglass hull, and had knowingly sold such duplicates in violation ofthe Florida statute. Bonito sought "a temporary and permanent injunction prohibiting [ThunderCraft] from continuing to unlawfully duplicate and sell Bonito Boat hulls or components," as wellas an accounting of profits, treble damages, punitive damages, and attorney's fees. App. 6, 7.Respondent filed a motion to dismiss the complaint, arguing that under this Court's decisions inSears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225 (1964), and Compco Corp. v. Day-BriteLighting, Inc., 376 U.S. 234 (1964), the Florida statute conflicted with federal patent law and wastherefore invalid under the Supremacy Clause of the Federal Constitution. App. 8-9. The trialcourt granted respondent's motion, id., at 10-11, and a divided Court of Appeals affirmed thedismissal of petitioner's complaint. 487 So.2d 395 (1986).

On discretionary review, a sharply divided Florida Supreme Court agreed with the lower courts'conclusion that the Florida law impermissibly interfered with the scheme established by thefederal patent laws. See 515 So.2d 220 (1987). The majority read our decisions in Sears andCompco for the proposition that "when an article is introduced into the public domain, only apatent can eliminate the inherent risk of competition and then but for a limited time." 515 So.2d,at 222. Relying on the Federal Circuit's decision in the Interpart case, the three dissenting judgesargued that the Florida antidirect molding provision "does not prohibit the copying of anunpatented item. It prohibits one method of copying; the item remains in the public domain." 515So.2d, at 223 (Shaw, J., dissenting).

II


Article I, 8, cl. 8, of the Constitution gives Congress the power "[t]o promote the Progress ofScience and the useful Arts, by securing for limited Times to Authors and Inventors the exclusiveRight to their respective Writings and Discoveries." The Patent Clause itself reflects a balancebetween the need to encourage innovation and the avoidance of monopolies which stiflecompetition without any concomitant advance in the "Progress of Science and the useful Arts."As we have noted in the past, the Clause contains both a grant of power and certain limitationsupon the exercise of that power. Congress may not create patent monopolies of unlimitedduration, nor may it "authorize the issuance of patents whose effects are to remove existentknowledge from the public domain, or to restrict free access to materials already available."Graham v. John Deere Co. of Kansas City, 383 U.S. 1, 6 (1966).

From their inception, the federal patent laws have embodied a careful balance between the needto promote innovation and the recognition that imitation and refinement through imitation are bothnecessary to invention itself and the very lifeblood of a competitive economy. Soon after theadoption of the Constitution, the First Congress enacted the Patent Act of 1790, which allowedthe grant of a limited monopoly of 14 years to any applicant that "hath . . . invented or discoveredany useful art, manufacture, . . . or device, or any improvement therein not before known orused." 1 Stat. 109, 110. In addition to novelty, the 1790 Act required that the invention be"sufficiently useful and important" to merit the 14-year right of exclusion. Ibid. Section 2 of theAct required that the patentee deposit with the Secretary of State, a specification and if possible amodel of the new invention, "which specification shall be so particular, and said models so exact,as not only to distinguish the invention or discovery from other things before known and used, butalso to enable a workman or other person skilled in the art or manufacture . . . to make, construct,or use the same, to the end that the public may have the full benefit thereof, after the expiration ofthe patent term." Ibid.

The first Patent Act established an agency known by self-designation as the "Commissioners forthe promotion of Useful Arts," composed of the Secretary of State, the Secretary of theDepartment of War, and the Attorney General, any two of whom could grant a patent. ThomasJefferson was the first Secretary of State, and the driving force behind early federal patent policy.For Jefferson, a central tenet of the patent system in a free market economy was that "a machineof which we were possessed, might be applied by every man to any use of which it issusceptible." 13 Writings of Thomas Jefferson 335 (Memorial ed. 1904). He viewed a grant ofpatent rights in an idea already disclosed to the public as akin to an ex post facto law,"obstruct[ing] others in the use of what they possessed before." Id., at 326-327. Jefferson alsoplayed a large role in the drafting of our Nation's second Patent Act, which became law in 1793.The Patent Act of 1793 carried over the requirement that the subject of a patent application be"not known or used before the application." Ch. 11, 1 Stat. 318, 319. A defense to aninfringement action was created where "the thing, thus secured by patent, was not originallydiscovered by the patentee, but had been in use, or had been described in some public workanterior to the supposed discovery of the patentee." Id., at 322. Thus, from the outset, federalpatent law has been about the difficult business "of drawing a line between the things which areworth to the public the embarrassment of an exclusive patent, and those which are not." 13Writings of Thomas Jefferson, supra, at 335.

Today's patent statute is remarkably similar to the law as known to Jefferson in 1793. Protectionis offered to "[w]hoever invents or discovers any new and useful process, machine, manufacture,or composition of matter, or any new and useful improvement thereof." 35 U.S.C. 101. Since1842, Congress has also made protection available for "any new, original and ornamental designfor an article of manufacture." 35 U.S.C. 171. To qualify for protection, a design must presentan aesthetically pleasing appearance that is not dictated by function alone, and must satisfy theother criteria of patentability. The novelty requirement of patentability is presently expressed in35 U.S.C. 102(a) and (b), which provide:

"A person shall be entitled to a patent unless -


"(a) the invention was known or used by others in this country, or patented or described in aprinted publication in this or a foreign country, before the invention thereof by the application forpatent, or

"(b) the invention was patented or described in a printed publication in this or a foreign country orin public use or on sale in this country more than one year prior to the date of application forpatent in the United States . . . ."

Sections 102(a) and (b) operate in tandem to exclude from consideration for patent protectionknowledge which is already available to the public. They express a congressional determinationthat the creation of a monopoly in such information would not only serve no socially usefulpurpose, but would in fact injure the public by removing existing knowledge from public use.From the Patent Act of 1790 to the present day, the public sale of an unpatented article has actedas a complete bar to federal protection of the idea embodied in the article thus placed in publiccommerce.

In the case of Pennock v. Dialogue, 2 Pet. 1 (1829), Justice Story applied these principles underthe patent law of 1800. The patentee had developed a new technique for the manufacture ofrubber hose for the conveyance of air and fluids. The invention was reduced to practice in 1811,but letters patent were not sought and granted until 1818. In the interval, the patentee hadlicensed a third party to market the hose, and over 13,000 feet of the new product had been soldin the city of Philadelphia alone. The Court concluded that the patent was invalid due to the priorpublic sale, indicating that, "if [an inventor] suffers the thing he invented to go into public use, orto be publicly sold for use" "[h]is voluntary act or acquiescence in the public sale and use is anabandonment of his right." Id., at 23-24. The Court noted that under the common law ofEngland, letters patent were unavailable for the protection of articles in public commerce at thetime of the application, id., at 20, and that this same doctrine was immediately embodied in thefirst patent laws passed in this country. Id., at 21-22.

As the holding of Pennock makes clear, the federal patent scheme creates a limited opportunityto obtain a property right in an idea. Once an inventor has decided to lift the veil of secrecy fromhis work, he must choose between the protection of a federal patent, or the dedication of his ideato the public at large. As Judge Learned Hand once put it: "[I]t is a condition upon the inventor'sright to a patent that he shall not exploit his discovery competitively after it is ready for patenting;he must content himself with either secrecy or legal monopoly." Metallizing Engineering Co. v.Kenyon Bearing & Auto Parts Co., 153 F.2d 516, 520 (CA2), cert. denied, 328 U.S. 881 (1946).

In addition to the requirements of novelty and utility, the federal patent law has long required thatan innovation not be anticipated by the prior art in the field. Even if a particular combination ofelements is "novel" in the literal sense of the term, it will not qualify for federal patent protection ifits contours are so traced by the existing technology in the field that the "improvement is the workof the skillful mechanic, not that of the inventor." Hotchkiss v. Greenwood, 11 How. 248, 267(1851). In 1952, Congress codified this judicially developed requirement in 35 U.S.C. 103,which refuses protection to new developments where "the differences between the subject mattersought to be patented and the prior art are such that the subject matter as a whole would havebeen obvious at the time the invention was made to a person of ordinary skill in the art to whichsaid subject matter pertains." The nonobviousness requirement extends the field of unpatentablematerial beyond that which is known to the public under 102, to include that which could readilybe deduced from publicly available material by a person of ordinary skill in the pertinent field ofendeavor. See Graham, 383 U.S. at 15. Taken together, the novelty and nonobviousnessrequirements express a congressional determination that the purposes behind the Patent Clauseare best served by free competition and exploitation of that which is either already available to thepublic, or that which may be readily discerned from publicly available material. See Aronson v.Quick Point Pencil Co., 440 U.S. 257, 262 (1979) ("[T]he stringent requirements for patentprotection seek to ensure that ideas in the public domain remain there for the use of the public").


The applicant whose invention satisfies the requirements of novelty, nonobviousness, and utility,and who is willing to reveal to the public the substance of his discovery and "the best mode . . . ofcarrying out his invention," 35 U.S.C. 112, is granted "the right to exclude others from making,using, or selling the invention throughout the United States," for a period of 17 years. 35 U.S.C. 154. The federal patent system thus embodies a carefully crafted bargain for encouraging thecreation and disclosure of new, useful, and nonobvious advances in technology and design inreturn for the exclusive right to practice the invention for a period of years. "[The inventor] maykeep his invention secret and reap its fruits indefinitely. In consideration of its disclosure and theconsequent benefit to the community, the patent i

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