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Tag: Intellectual Property Strategy

Lynn’s Picks: Foresight’s Patent of the Week – US Patent Application 17/852,089: Spare Wheel Containers for a Vehicle (Rivian Automotive)

Posted on Modified on by Lynn Dudinsky

Disclaimer: This blog was created for informational purposes only and does not represent Foresight’s or the author’s opinion regarding the validity, quality or enforceability of any particular patent covered in this blog.  Foresight is not a law firm and no portion of the information contained in this blog was intended to serve as legal opinion.

In this week’s blog, we are kicking off the Lynn’s Picks blog series by highlighting a recent filing by Rivian Automotive carrying the US patent application number 17/852,089 titled: “Spare Wheel Containers for a Vehicle”. Rivian Automotive, Inc. designs, develops, manufactures, and sells electric vehicles and accessories. The company offers several models of electric pickup trucks and sports utility vehicles. It provides Rivian Commercial Vehicle platform for Electric Delivery Van with collaboration with Amazon.com, Inc. The company sells its products directly to customers in the consumer and commercial markets. Rivian Automotive, Inc. was founded in 2009 and is based in Irvine, California.  In fiscal Year 2023, Rivian reported $3.8 billion in revenues, based on the company’s most recent annual report.

As seen in the images below, the patent application, which was filed in June of 2022, relates to a container built into a spare tire holder that would enable the user to utilize the space inside the tire that is typically used exclusively to simply hold the spare tire. In the system seeking patent protection, this traditionally unused space would now provide storage through a “plurality of containers each comprising a respective container type” and electrical components that would allow the vehicle to identify the container type. The patent specification includes a variety of different applications for these containers including, but not limited to: fluid container configured to transfer water, coolant, lubricant or other fluids between the vehicle and the container; a storage container that could hold a first aid kit or toolbox; an identifier tag such as RFID as well as an auxiliary battery coupled to the vehicle’s electrical system. As you review the specification of the patent, you will see a number of potential applications to this technology and probably can come up with a few that you would like to see in your vehicle.

It is important to note that this is a pending patent application that has no guarantee of issuance and even if a patent is issued, the final claim language may look very different from the proposed claim language due to the existence of prior art that may require modifications to the proposed claim language.  That being said, we selected this application for the first of this series because it highlights the relative simplicity that often is tied to innovation. In this case, an engineer likely saw an open space that is rarely used for anything other than to cover the spare tire (for example, any Jeep Wrangler you see on the road is either displaying the tire or the tire cover with either JEEP or some personal message being displayed) and sought out to create a use for that empty space. The fundamental concept here is to make use of available space, a concept we all can relate to. It is a great example of finding way to improve things you interact with every day and finding ways to protect those improvements.

Have you come across any interesting patents you would like us to feature in future blogs? Please send us an email at media@foresightvaluation.com or call our office at (650) 561-3374.

Masimo vs. Apple: The Role of the ITC in Patent Disputes

Posted on Modified on by Lynn Dudinsky

As referenced in our previous blog, Demystifying the International Trade Commission (ITC), Apple made headlines in December 2023 for halting the sale of its latest Apple Watch Series 9 and Ultra 2 models in the US on December 21st. The reason behind this was a patent dispute between Apple and Masimo Corp. related to a blood oxygen sensor in which the ITC ruled Apple violated Masimo’s patents. While this came to media attention in late 2023, this case had been working its way through the court system for years, starting when Masimo won a patent infringement case against True Wearable in 2022. True Wearables’ founder and CEO Marcelo Lamego worked at both Masimo and Apple where he developed similar technologies before founding True Wearables. True Wearables’ founder first worked at Masimo and then contacted Apple CEO Tim Cook in 2013, offering to help with the Apple Watch. He subsequently joined Apple in 2014. At Apple Mr. Lamego was a named inventor on several health-related Apple patents before leaving to start True Wearables in 2014, after only a few months at Apple.  So Masimo found itself in a situation where both companies, True Wearables and Apple, were allegedly infringing its patents, which led to it taking legal action against both companies

In conjunction with the patent dispute against True Wearables which resulted in a permanent injunction against the sale of True Wearables infringing devices, Masimo also filed a Section 337 action at the ITC against Apple alleging that the company was importing into the US devices that infringed multiple patents held by Masimo. In Section 337 actions, the complainant must establish that a domestic industry for articles protected by the asserted patent(s) exists or is in the process of being established.  There are two requirements that must be met in regards to the ITC domestic industry analysis: an economic element and a technical element. The complainant  (Masimo) must show that one of the economic activities identified in 19 U.S.C § 1337(a)(3) has occurred to fulfill the economic requirement. These activities include: significant investment in plant and equipment, significant employment of labor or capital, or substantial investment in exploitation, including engineering, R&D or licensing. In regards to the technical element, the complainant must establish that it practices at least one claim in each asserted patent. One of the main arguments made by Apple was whether Masimo’s W1 smartwatch, or any product by Masimo, was actually released prior to the complaint being filed by Masimo. This is an area of active development and will likely feature prominently in the appeal by Apple which was filed on December 23, 2023.

In January of 2023, the ITC issued their Final Initial Determination that Apple was infringing on Masimo’s patents. The ITC then issued a limited exclusion order and cease and desist order against Apple in late October of 2023. Once this decision was made, the next step was a 60-day presidential review period where Apple hoped that President Biden would veto the ban as President Obama had done for Apple in 2013 in regards to the iPhone and iPad. However, as the 60-day review period approached its conclusion and there was no indication that President Biden would issue such a veto, Apple pulled the Watch Series 9 and Watch Ultra 2 from its stores and President Biden eventually declined to veto the ruling of the FTC. As a last resort, Apple filed an appeal with the United States Court of Appeals for the Federal Circuit (CAFC) and secured a temporary stay of the ITC’s importation and sales ban. On December 27, the Federal Circuit granted Apple’s request for an emergency stay.  This temporary could be extended through the conclusion of the ITC appeal which could take about 18 months.

The outcome of this appeal and any further actions are important to Apple as affected watch models have been some of its best sellers, accounting for a substantial portion of the company’s overall watch sales. Although Apple hasn’t publicly disclosed revenue figures, analysts estimate that the Apple Watch alone generated approximately $17 billion in sales in fiscal 2023. Moreover, the removal of the affected watches from Apple’s online store and physical retail locations only adds another layer of complexity to the situation, as the watches will still be available through third-party retailers. Apple is working across multiple venues to overcome the decision by the ITC. As referenced above, Apple filed the appeal and won a temporary stay and will push the CAFC to find in its favor and reverse the decision of the ITC. At the same time, Apple has submitted plans to the US Customs and Border Protection for a software solution. One other possibility in this complex dispute is for Apple to pay Masimo to end the dispute and put an end to the business disruption caused by this ongoing patent dispute.

The key takeaway from the events surrounding the Masimo patents is that the ITC is an important venue for patent enforcement in the U.S., where the range of remedies may actually include a physical importation and sales ban, particularly when it comes to products where the supply chain dictates importation of products manufactured overseas.  Stay tuned for more updates on this blog as the CAFC and ITC appeal proceedings continue in 2024.

Demystifying the ITC: A Guide on the Role of the ITC in Patent Disputes

Posted on Modified on by Lynn Dudinsky

The International Trade Commission (ITC) received a lot of media attention in December of 2023 due to the patent dispute between Apple and Masimo resulting in a temporary ban on the importation and sale of certain models of the Apple Watch. While many people are familiar with State and Federal courts, most people are not familiar with ITC so Foresight created this primer to better understand the role of the ITC in patent disputes.

The ITC stands as a critical resource for patent holders, offering a unique avenue to counter patent infringements by preventing the importation of infringing products at U.S. ports of entry. However, the ITC’s procedures are distinct from those of Federal courts where patent disputes are normally litigated, demanding a nuanced understanding, especially for startups.

Filing a Complaint and Building Your Case

Initiating an ITC investigation is akin to commencing a lawsuit in Federal court. A formal complaint, known as a Section 337 action, is submitted, alleging that products arriving in the U.S. violate a valid patent. Simultaneously, the complaint must demonstrate the presence of a “domestic industry” linked to the allegedly infringed patented products.

Proving a “domestic industry” involves showcasing substantial investments in areas like labor, facilities, or research and development that support both the infringing products and the complainant’s own products. Following the complaint, the ITC evaluates whether to commence an investigation, typically within 30 days. Once initiated, the investigation becomes official and is documented in the Federal Register. Concurrently, any ongoing court cases dealing with the same issues and involving the same parties are temporarily paused during the ITC’s investigation.

The Role of the Judge and Special Staff

Throughout the investigation, an Administrative Law Judge (ALJ) assumes a central role as the fact-finder. The ALJ presides over hearings, issues decisions on motions, and substantially influences the investigation’s course. Adding to the complexity is the “Staff,” an attorney appointed from the Office of Unfair Import Investigations (OUII), who maintains an independent role during the investigation.

Timetables and Procedural Rules

The ITC strives for expedited investigations, determining an ultimate “target date” for the final decision, usually within 16 months of commencement. The ALJ establishes a procedural schedule encompassing deadlines for various aspects such as discovery, claim interpretation, motions, and hearings.

Collecting Evidence and Safeguarding Sensitive Information

After the investigation begins, both parties embark on evidence gathering, adhering to the established schedule. They employ tools like questions, document requests, and interviews. It is worth noting that in the ITC, responses to discovery requests must be provided within a shorter timeframe, just 10 days, in contrast to the more extended periods typically allowed in standard court proceedings. Renowned for its efficiency, an ITC investigation often concludes in months rather than the year or more typical in district court cases.

To safeguard sensitive information revealed during discovery, protective orders are issued, requiring attorneys to adhere to specific guidelines. Confidential business information (CBI) remains accessible only to specific individuals, including outside lawyers, experts, the Staff, ALJ, and the Commission.

Hearings and Witness Testimonies

ITC hearings depart significantly from traditional court trials. A jury is absent, and the ALJ serves as the fact-finder. Additionally, many ALJs opt for written witness statements instead of live testimony, with cross-examinations conducted during the hearing.

Initial and Final Decisions and Post-Investigation Remedies

Following the hearing and post-hearing arguments, the ALJ delivers an initial determination (ID). This document determines whether a violation of Section 337 occurred, based on evidence and the presence of a domestic industry. It also scrutinizes patent claims individually. Once the ITC’s determination has been finalized, and if a violation is established, remedies specified in the final determination (FD) become accessible.

Typically, the ITC offers exclusion orders or cease and desist orders. Exclusion orders direct U.S. Customs and Border Protection to block infringing products at ports of entry, with two types available – general (applicable to all infringing products) and limited (specific to identified manufacturers or importers). Cease and desist orders prohibit respondents from selling infringing products already within the U.S.

Presidential Review and Appellate Processes

Given that the ITC is a government agency, the President reviews exclusion orders within 60 days of the FD’s issuance. If no action is taken during this period, the ITC’s decision becomes final. Subsequently, either party can launch an appeal to the United States Court of Appeals for the Federal Circuit.

Conclusion

The ITC is an important forum for startups to become familiar with due to the impact of an exclusion order. Patent infringement is a common issue that startups are dealing with, the ITC is an important venue to addressing infringement involving products imported into the U.S. For a recent example of the role of the ITC in patent disputes and the impact of an exclusion order, please see our next blog focused on the ITC dispute between Apple and Masimo.

The Supreme Court’s Decision in Warhol v. Goldsmith: Interpreting Copyright Fair Use

Posted on Modified on by Lynn Dudinsky

There have been many conflicting opinions regarding the impact of the Supreme Court’s decision in Andy Warhol Foundation for the Visual Arts v. Goldsmith, with some circles claiming that the decision “Changed the Future of Art” and others applauding the Court for providing clarity on fair use in copyright. Given the varied opinions on the outcome, the purpose of this article is to highlight the changes and the potential impact of the decision. In order to do that, it is important to first explain the fair use framework before diving into the details of the Court’s decision.

Fair use in copyrights enables someone other than the copyright owner to copy, perform, transmit, distribute copies, or display a copyrighted work under certain circumstances without it being considered infringement. The concept of fair use as a limitation on the exclusive rights of a copyright holders is codified in the Copyright Act, 17 U.S. Code Section 107, which describes fair use for purposes such as criticism, comment, news reporting, teaching, scholarship or research is not infringement and lays out a four factor test to assist in the determination of whether a use is protected as fair use. That four factor test includes the following factors to be considered:

  1. The purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educations purposes;
  2. The nature of the copyright work,
  3. The amount and substantiality of the portion used in relation to the copyrighted work as a whole, and
  4. The effect of the use upon the potential market for or value of the copyrighted work.

The first factor has traditionally been the primary focus of the fair use analysis and is commonly referred to as the transformative use test. This test was first established in a case between the rap group, 2 Live Crew, which used portions of the song “Oh, Pretty Woman” in the opening of one of their songs. The Court in that decision ruled that 2 Live Crew’s use of the portion of “Oh, Pretty Woman” was transformative because it was a parody of the original. Similar examples of transformative use of copyrighted materials typically involve use of copyrighted material for educational or commentary purposes but also extends to libraries making digital copies of books for the purpose of 1) preservation, 2) full-text search and 3) electronic access for disabled patrons who cannot read print versions which the court determined was transformative use.

Stepping back to the Supreme Court’s Warhol decision while keeping the transformative use in mind, we can go into the relevant details of the Warhol case. The case involved two artists, Andy Warhol and Lynn Goldsmith. Lynn Goldsmith specialized in rock-and-roll photography and had her work published in magazines including Life, Time, Rolling Stone and People. Andy Warhol was a visual/pop artist with works appearing in museums around the world. In 1984, Lynn Goldsmith licensed one of her photographs of the artist Prince to Vanity Fair for use as an artist’s reference. This reference photograph was then used by Andy Warhol to make a silkscreen which was featured in Vanity Fair. Lynn Goldsmith was credited as the owner of the source photograph and was paid $400. The license between Lynn Goldsmith and Vanity Fair in 1984 under the condition that the photo be used for one time only.

Unbeknownst to Lynn Goldsmith, Andy Warhol not only created the one silkscreen for Vanity Fair, he also derived 15 additional works of Prince using the reference photo. One of those additional works was later licensed by the Andy Warhol Foundation for the Visual Arts to Conde Nast for $10,000. Importantly, the purpose of this license to Conde Nast was to publish an article on the artist Prince, the same purpose as the original license with Vanity Fair. When Lynn Goldsmith approached the Andy Warhol Foundation expressing her belief that their use of her photograph and the resulting work that was licensed to Conde Nast infringed her copyright, the Andy Warhol Foundation sued Lynn Goldsmith for declaratory judgement that the works were non-infringing or, in the alternative, that they made fair use of Lynn Goldsmith’s photograph.

The District Court granted summary judgement for the Andy Warhol Foundation, focusing on the first factor and determining that the use was transformative because looking at the works of Andy Warhol and the reference photograph side-by-side, the court opined that they have difference character and give a new expression to Lynn Goldsmith’s photograph. It is important to see the side-by-side, which is copied below, because speaking as someone who is not artistic it is easy to argue that adding what appears to mostly be an orange background does not transform the photo from a picture of Prince to something more, but that is the difficulty with a test that can oftentimes hinge on subjective interpretation of artistic expression that is not typically in the wheelhouse of the average attorney or judge. The District Court believed the Warhol silkscreen on the right transformed the Prince depicted on the left from a vulnerable, uncomfortable person to an iconic, larger-than-life figure and that the picture on the right is immediately recognizable as a Warhol rather than a photograph of Prince.

The Court of Appeals, perhaps being less knowledgeable about artist expression or perhaps viewing the works from a more objective perspective that both images are clearly Prince, reversed and remanded after holding that all four fair use factors favored Lynn Goldsmith. Focusing on the first factor, the Court of Appeals rejected the lower court’s argument that transformative is met when any new aesthetic or new expression is added to source material. The Court of Appeals focused on whether the work’s (orange Warhol on the right above) use of its source material (Lynn Goldsmith photo on left) is in service of a fundamentally different and new artistic purpose and character, adding that the transformative purpose must be something more than the imposition of another artist’s style on the primary work. The opinion also made clear that the lower court’s belief that the work was transformative because it is immediately recognizable as a Warhol was wrong and would only create a celebrity-plagiarist privilege.

The Supreme Court granted certiorari and summarized the issue fairly succinctly by describing the first factor purpose test for fair use in this case as portraits of Prince used to depict Prince in magazine stories about Prince, the original photograph and the Andy Warhol Foundation’s copying use of it share substantially the same purpose and that purpose was commercial in nature. The last part of that summary by the Court is important because the preamble to the fair use defense to copyright infringement lays out a number of examples that reflect the sorts of copying that courts and Congress have found to be fair use such as criticism, comment, news report, teaching, scholarship or research. Each of these uses serve “a manifestly different purpose from the work itself.” When viewed together, the commercial use of a portrait of Prince to depict Prince in articles about Prince, based off of a reference photo that has been licensed for commercial use on its own to depict Prince in magazine stories about Prince, is not transformative use simply because it was created by Andy Warhol.

The Court rightly refocused the test, in this specific instance, away from the subjective review of the level of transformation by one artist of another artist’s work and directly to the purpose of the use in determining whether fair use is a viable defense to copyright infringement. The 2 Live Crew example described above was not a case where 2 Live Crew used the full lyrics and simply sang it differently to make it recognizable as 2 Live Crew, instead, it was a parody that used an immaterial amount of the source material to mimic the original. The Court provides an additional and pointed example referencing Andy Warhol’s use of the Campbell’s Soup can and logo to create his Soup Can series. Andy Warhol’s Soup Can series depicts Campbell’s copyrighted logo that it uses for advertising purposes; however, Andy Warhol’s purpose in creating the Soup Can series was not to advertise and increase sales on behalf of Campbell’s but was for the purpose of artistic commentary on consumerism. The fact that Campbell’s benefitted from the purpose behind Andy Warhol’s series and sold more soup cans had no bearing on the purpose being commentary which is directly implicated in the preamble to the fair use exemption.

Dissenting opinions by the Court and substantial commentary by artists and others who have relied on fair use paint a picture that would have one believe that the fair use exemption has been forever changed and that under this new approach, no amount of artistic creativity will provide a fair use defense for commercial works. In my opinion, those concerns are overblown due to Supreme Court’s narrow ruling in this cases that benefited from a very specific set of facts which the Court highlighted when describing the purpose of the allegedly infringing use of portraits of Prince used to depict Prince in magazine stories about Prince. This is further narrowed by the original license that restricted the use of the source photograph to one time use by Vanity Fair. With those limitations in mind, the narrow ruling by the Supreme Court aligns with the purpose of the original copyright act and the balance that must be met between creative freedom and protecting original works of authorship.

 

 

 

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