JOHN W. SCHLICHER

PATENTS, PATENT LITIGATION, PATENT DISPUTE RESOLUTION AND

SETTLEMENT, LICENSING, ANTITRUST, LAW AND ECONOMICS

 

 

 

John W. Schlicher, Patent Law: Legal and Economic Principles, Thomson West (1992, Second Edition 2003)

 

Doctrine of Equivalents, Nonobviousness, Section 102(b), Market Power

 

Federal Circuit Rejects Function-Way-Result as the Sole Test of the Doctrine of Equivalents - Hilton Davis 

 

In 1992, Schlicher pointed out that Graver v. Linde did not make consideration of function-way-result the sole test for applying the doctrine of equivalents.  He said that applying a function-way-result test defeated the boundary function of claims, and eliminated the role of claims to provide inexpensive and relatively certain information about the boundaries of the rights. In Hilton Davis, the Court of Appeals agreed.  Hilton Davis Chemical Co. v. Warner-Jenkinson Co., 62 F.3d 1152 (Fed. Cir. 1997).  Judge Nies’ opinion tracked almost precisely his analysis of the development of the doctrine in the Supreme Court.  That analysis proved influential in the Supreme Court’s decision in that case.  Judge Newman referred to Patent Law: Legal and Economic Principles (1992) in her opinion.   

 

Supreme Court Overrules the Court of Appeal’s Nonobviousness Standard - KSR Intern. Co. v. Teleflex 

 

In 1992, Schlicher explained the ways in which the law of nonobviousness developed by the Court of Appeals for the Federal Circuit was inconsistent with the approach of the United States Supreme Court.  He described how the Court of Appeals’ suggestion - motivation test meant that “[i]f almost any independent thinking was required to derive the invention from the prior art, the invention was not obvious.”  He said that “[t]he absence of suggestions or motivation in the written prior art hardly seems a compelling standard for obviousness.”  He also described how the Court of Appeals’ test was inconsistent with the Supreme Court’s approach to inventions that were combinations of old parts.  (“By that rule [the suggestion-motivation test], the Court of Appeals also demolishes the Supreme Court’s special rule for combinations of old parts that asks if the old parts do something different in combination than they would do separately.”).  In 2007, the Supreme Court decided KSR Intern. Co. v. Teleflex. The Court overruled the Court of Appeals’ suggestion or motivation test, said that an invention may  be obvious even thought a person of ordinary skill would be required to exercise creativity to make it, and insisted that the Court of Appeals follow the Supreme Court’s approach to inventions made by combining old parts and components.

 

Federal Circuit Modifies the Standards for Applying Section 102(b) – Weatherchem, Mahurkar, Ferag.

 

In 1992, Schlicher noted that Court of Appeals’ use of four policies to guide application of the on sale bar omitted the main goal of the patent system and this omission led the courts apply the on sale bar to invalidate patents in situations where there the reduction in incentives to invent was unjustified.  In 1995, Judge Frank Easterbrook (sitting by designation in a district court) noted this omission and found that it lead to the startling result that not all nonexperimental sales were section 102(b) events.  The Federal Circuit affirmed.  Matter of Mahurkar Double Lumen Litigation, 831 F.Supp. 1354 (N.D.Ill. 1993), aff’d 71 F.3d 1573 (Fed. Cir. 1995).  Schlicher also said that, of the four policies then employed, the policy against an inventor’s commercial exploitation of the invention for significantly longer than the term of one patent was and should be the most important policy.  In Ferag AG. Quipp Inc., 45 F.3d 1562, 1565, 33 USPQ2d 1512, 1515 (Fed. Cir. 1995), the Court of Appeals agreed and said this was the main policy of section 102(b).  In 1992, Schlicher also said wrote that the Court of Appeals’ use of four policies to guide application of the on sale bar did not translate into a clear or necessarily sensible guide for deciding that issue.  In 1998, the Court of Appeals ceased using this four policy test as unnecessarily vague.  Weatherchem. Corp. v. J.L. Clark, Inc., 163 F.3d 1326, 1333 (Fed. Cir. 1998). 

 

Supreme Court Eliminates the Presumption of Market Power - Illinois Tool Works 

 

In 1992, Schlicher explained why the law was wrong when it presumed that the seller of a patented product possessed market power for purposes of certain antirust claims.  (“The seller of one hundred percent of the products covered by a patent may not possess market power if there are sellers of noninfringing substitute products that limit its ability to limit market output, and raise price.”)  In 2006, the Supreme Court eliminated this presumption.  Illinois Tool Works Inc v. Independent Ink, Inc., 126 S.Ct. 1281 (2006).