Tuesday, April 2, 2013

Patent office confirms three claims of Apple's rubber-banding patent -- but not the key one

Samsung just filed a notice with Judge Koh's court (Northern District of California) regarding the status of the ongoing reexamination of Apple's famous rubber-banding (or "overscroll bounce") patent, U.S. Patent No. 7,469,381, against which an anonymous party requested an ex parte reexamination. In October 2012 the United States Patent and Trademark Office issued a first Office action tentatively rejecting all claims of the '381 patent -- less than two months after a federal jury deemed the patent valid as well as infringed by Samsung. The latest decision, which according to Samsung was published by the patent office "on or after March 29", is a final Office action -- which gives it more weight than the first one, but "final" isn't really final in this process as I'll discuss further below.

While Apple has made some progress since the first Office action and the USPTO's Central Reexamination Unit has now confirmed claims 14, 17 and 18, the other 17 claims of this patent (1-13, 15, 16, 19, 20) have been rejected once again. The "final" rejection also relates to the claim-in-suit in the ongoing Apple v. Samsung litigation, claim 19.

Apple now has two months (which can be extended) to respond. Again, the word "final" sounds more definitive than this really is. Sometimes the Central Reexamination Unit reconsiders such "final" decisions. Even if it doesn't, this "final" rejection can and certainly will be appealed to the Patent Trial and Appeal Board (PTAB), sort of an appellate division within the USPTO. The PTAB can make a final decision as far as the USPTO is concerned, but frequently remands a matter to the Central Reexamination Unit. And a final-final USPTO decision can then be appealed to the United States Court of Appeals for the Federal Circuit. It will take years before a truly final decision on the validity of this patent issues.

Judge Koh did not consider the first Office action to be relevant when she ruled on Samsung's motion for judgment as a matter of law. This "final" Office action is going to bear some more weight, but the judge won't revisit the JMOL ruling. What Samsung presumably hopes is that this will have some persuasive impact as Judge Koh is weighing the parties' proposals for how to proceed, with Apple favoring a prompt new trial to determine damages for 14 of the 28 accused products and Samsung requesting a partial final judgment from the district court, which it will immediately appeal to the Federal Circuit (and it wants the district court to stay its proceedings pending that appeal). Should the Federal Circuit ultimately hold claim 19 of the rubber-banding patent invalid during this appeal, there would have to be a new trial (at least a new damages trial) with respect to all products at issue in the litigation because the first jury's damages awards were product-specific, not patent-specific, so there's no way of knowing how much the jury would have awarded without this patent. The overall damages award in this case is baed on design patents to a far greater extent than the three multitouch software patents-in-suit, but again, the problem is that the jury didn't disaggregate its awards in the form of a patent-product matrix (which is what Samsung wanted, but Apple successfully opposed it because it wanted to keep things simple for the jury).

It's important to consider that the legal standards differ between the two parallel proceedings. In USPTO reexamination proceedings the standard is "preponderance of the evidence", which is a lower standard than the "clear and convincing evidence" standard that applies to the Apple v. Samsung litigation. The fact that the USPTO just changed mind with respect to three of the 20 claims indicates that the relevant patentability questions are threshold questions, making it quite possible that the very same court (for example, the Federal Circuit) might deem claim 19 invalid at a later stage (when the reexamination matter finally arrives at the Federal Circuit) under the lower standard but refuse to invalidate it under the higher standard.

The worst news for claim 19 is that it was deemed anticipated (i.e., non-novel), not just obvious (i.e., somewhat new, but not inventive), and that there are separate findings of anticipation over the following two prior art references:

  • "Lira":

    PCT Publication No. WO 03/081458 on "controlling content display", by AOL/Luigi Lira, published on October 2, 2003

  • "Ording":

    U.S. Patent No. 7,786,975 on a "continuous scrolling list with acceleration"; this is an Apple patent that I've never seen asserted in litigation; the named inventors are Bas Ording, Scott Forstall, Greg Christie, Stephen O. Lemay and Imran Chaudhri

In order to salvage claim 19, Apple will have to prove that it's not only different from what those prior art references disclose, but that there was also an inventive step involved between the prior art and this claim -- and Apple needs to surmount these hurdles with respect to either prior art reference.

This is the notice Samsung filed, which includes the 112-page decision by the USPTO as Exhibit A:

13-04-01 Samsung Statement Re '381 (Rubber-banding) Final Office Action

Last year the USPTO also issued a first Office action tentatively rejecting the "Steve Jobs patent", which Apple is asserting against Samsung at the ITC. The next decision relating to that one will probably also come down in the foreseeable future.

Apple's multitouch patents are under invalidation pressure in other jurisdictions as well. There's an ongoing opposition proceeding before the European Patent Office (EPO) concerning the European rubber-banding patent. Samsung and Google's Motorola Mobility are opposing the relatively recent grant of this patent. A week ago Apple filed its reply to the notices of opposition. On February 8, 2013 the Mannheim Regional Court stayed a German Apple v. Samsung lawsuit pending the opposition proceeding (I didn't report on the order to stay because I wasn't in Mannheim when it was announced, but I found out later). On Thursday (April 4, 2013) the Munich-based Bundespatentgericht (Federal Patent Court) will hold a hearing on Samsung and Motorola Mobility's nullity actions against the German part of Apple's European slide-to-unlock patent.

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