- CAFC Upholds District Court Finding for Netflix Invalidating Adaptive Patent Under 101 – The Federal Circuit affirmed a district court’s finding that Adaptive Streaming Inc.’s patent claims were directed at an abstract idea and thus were invalid under 35 U.S.C. § 101.
- 3 Key Questions As Cleveland MLB Team Mulls New Name – On Monday, Major League Baseball team the Cleveland Indians announced that it is starting the process to change its name as teams continue to face pressure to drop their “disparaging monikers.”
- Employment Law and Patent Law Collide: Federal Circuit Rules that California’s Non-Compete Restrictions Also Limit the Scope of Patent and Invention Assignment Clauses – The Federal Circuit ruled that certain employment agreement provisions requiring former employees to assign their inventions to their employer after such employment ends are not permitted in California.
Here’s the latest.
CAFC Upholds District Court Finding for Netflix Invalidating Adaptive Patent Under 101
Last year, Adaptive Streaming Inc. (Adaptive) sued Netflix for infringement of its patent which “provides a technique including a system for capturing audio and video information from a first source and displaying such video and audio information at a second source, where the format of the first source and the format of the second source are different from each other.” The district court agreed with Netflix in concluding that Adaptive’s patent concerned ineligible subject matter under Section 101. The Court of Appeals for the Federal Circuit (CAFC) affirmed. The CAFC analyzed the claims using the Alice framework. With respect to step one, the CAFC affirmed the district court’s finding that the claims were directed to an abstract idea of collecting and transcoding information into multiple formats. Rebecca Tapscott illustrates the court’s conclusion.
The CAFC explained that the claims and written description of the ‘305 patent make clear that the “claimed advance is the abstract idea of format conversion, from an incoming signal’s format to a variety of formats suited to different destination devices.” The court added that the “focus is not any specific advance in coding or other techniques for implementing that idea; [thus,] no such specific technique is required.”
Additionally, the CAFC found that under step two of the Alice framework, the claims failed to incorporate anything more that would transform the concept into patent-eligible subject matter.
The CAFC noted that the claims recited only generic computer hardware, such as a “processor” and a “broadcasting server” with an “image retrieval portion,” “a data structure,” and a “transcoding module,” which were described in the specification as conventional. According to the CAFC, there was “no identification in the claims or written description of specific, unconventional encoding, decoding, compression, or broadcasting techniques.”
3 Key Questions As Cleveland MLB Team Mulls New Name
Earlier this year, the Washington, D.C. NFL team dropped its team name as the “Washington Redskins” and became the Washington Football Team. Three years ago, the Cleveland Indians stopped using its “Chief Wahoo” logo and this week, the Cleveland Indians announced that it has plans to begin the name-change process. Zachary Zagger addresses the intellectual property concerns as teams continue to reassess their logos and names. Filing a trademark application with the U.S. Patent and Trademark Office may be especially difficult for popular sports teams who likely have worldwide recognition. As Zagger expresses in the article, it is difficult to register marks in secret or through a shell company.
A team’s announcement that its name is changing can serve as an invitation to so-called trolls to file applications for potential names, foreclosing some options and mucking up the process.
For instance, even before the Washington Football Team announced its name change, several intent-to-use applications had been filed for names considered potential replacements as the team faced public pressure to make a move.
Zagger also illustrates the sort of irony in teams wanting to distance themselves from their old controversial marks, while also preventing other companies from using their old mark.
If there are competing products bearing the old name after it is abandoned, then a team may have some “residual” rights in the trademark and be able to argue that those products are falsely trying to associate with the team, Gentner said. Either way, while announcing the decision to stop using the name may be evidence the moniker was abandoned, the registration will not immediately expire.
The final question Zagger addresses is how this announcement may lead other teams and brands to follow suit and abandon their controversial marks. While the U.S. Supreme Court struck down the part of the Lanham Act that concerned disparaging marks in 2017’s Matal v. Tam (formerly Lee v. Tam) ruling on First Amendment grounds, public opinion and legal pressure may encourage sports teams and other companies to re-evaluate their brand identifiers.
Employment Law and Patent Law Collide: Federal Circuit Rules that California’s Non-Compete Restrictions Also Limit the Scope of Patent and Invention Assignment Clauses
In Whitewater West Industries v. Alleshouse, the Federal Circuit found that in California, certain provisions in employment provisions that require invention assignment are not permitted. In the case, Mr. Alleshouse conceived of inventions after he resigned from Wave Loch, Inc., Whitewater’s predecessor-in-interest. Mr. Alleshouse’s inventions were conceived after his employment had ended and Mr. Alleshouse did not use any confidential information or trade secrets of Wave Loch in creating and eventually patenting these inventions. However, Whitewater brought suit against Mr. Alleshouse in 2017 seeking to enforce the employment agreement that included an assignment of inventions provision. While the Southern District of California ruled in favor of Whitewater, the Federal Circuit reversed concluding that the assignment provision was invalid under California Business and Professions Code § 16600.
The Federal Circuit found that the assignment provision restrained Mr. Alleshouse’s future employment because it was unlimited in time and geography, and applied to any invention that was merely “suggested by” his work for Wave Loch or “in any way connected to any subject matter within the existing or contemplated business” of Wave Loch.
Paul T. Qualey and Christopher M. Pardo delineate three lessons for employers in California following this ruling.
First, California law allows for assignment provisions that apply to inventions conceived by current employees that relate to the employer’s business. . . . Second, while not expressly addressed in Whitewater given the facts of that case, assignment provisions directed to inventions developed or derived from an employer’s trade secret or proprietary information, even if conception is post-employment, still seem to be enforceable. . . . Third, and on a final note, Section 16600 generally cannot be avoided by including choice of law and venue provisions that specify another state in the employment agreement, as those provisions are generally not enforceable against employees located in California.