Intellectual Property Bulletin
March 11, 2009
In this issue:
What a Croc! Courts Adopt a More Holistic Approach in Anticipation Analysis
The U.S. District Court for the Southern District of Florida found that anticipation of an existing design patent application invalidated a later design patent of the shoe style popularized by Crocs, Inc. In International Seaway Trading Corp. v. Walgreens Corp., S.D. Fla., No. 08-cv-80163-KLR (S.D. Fla. Jan. 22, 2009), the court granted defendant Walgreens' motion for summary judgment and invalided a design patent held by International Seaway. In doing so, the court applied the precedent from the recently decided Egyptian Goddess v. Swisa, 543 F.3d 665 (Fed. Cir. 2008) (en banc), which guards against the risks of comparing verbal descriptions of similar designs in an anticipation analysis. The court reviewed the shoe designs as a whole, and as they would be viewed by the public, finding that the later patent was essentially a "knock-off" of Crocs' trendy foam shoe. The recent holding in Egyptian Goddess should be considered a warning to trial courts against placing too much emphasis on certain features when comparing verbal descriptions of a design and failing to consider the overall impression of the design. If courts continue to follow this lead, future patent petitioners can expect a holistic approach to anticipation analysis.
No Method to the Madness
In January 2009, the United States Supreme Court was asked to review In re Bilski, a case which shook up the IP world last October when the court adopted a "machine-or-transformation" test as the "definitive test" for process patents. In Bilski, the Federal Circuit rejected the patent application for a process of hedging against changes in energy costs, holding, in essence, that abstract processes (or "methods") are not patentable. The court held that the only patentable processes were those linked to machines, or that transformed an article "into a different state or thing." Although the Bilski decision involved a business method claim, its application could affect all method claims, including those in the computer science or biotech industries. The petitioners in Bilski claimed that if the Supreme Court does not overturn the case, it could discourage investment in both industries and create roadblocks to research and development. If four justices vote to grant the petition for certiorari, the Supreme Court will consider Bilski on its merits.
How Safe is the DMCA's "Safe Harbor"?
In a copyright infringement case, a California court extended the scope of protection under the Digital Millennium Copyright Act's ("DMCA") "safe harbor" provision for service providers. Universal Music Group ("UMG") sued Veoh, an operator of a videosharing Web site whose online content featured songs that were copyrighted by UMG. In UMG Recordings Inc. v. Veoh Networks Inc., No. CV 07-5744 AHM (AJWx) (C.D. Cal. 2008), the court held that despite the infringing content displayed on its Web site, Veoh was immune from liability under the "safe harbor" provision of the DMCA, which shields online service providers from liability for infringement that occurs "by reason of the storage at the direction of a user" on the server's network. UMG argued that some functions on Veoh's network, including providing users access to streaming video, went beyond "storage" as defined in the DMCA. However, the court interpreted the statute broadly, and held that automated functions related to user access of user data received "safe harbor" protection. This holding extends "safe harbor" protection to the following features on video sharing sites: (1) automatically creating copies of uploaded video files that are composed of smaller "chunks" of the original file; (2) allowing users to access uploaded videos via "streaming" technology; and (3) allowing users to access uploaded videos by downloading whole video files. The court also reaffirmed the decision that "safe harbor" protection extended to online sites that automatically create "flash-formatted" copies of video files uploaded by users. The DMCA's "safe harbor" provision extends protection to automated functions related to users’ access to user data on video-sharing Web sites.
For further information, please contact Marc S. Friedman (mfriedman@sonnenschein.com or 212-768-6767), other lawyers in our Intellectual Property & Technology Group, or your regular Sonnenschein contact.
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