In patent case, court broadens protection for new ideas

Decision ends inventors' uncertainty over legality of copies that aren't exact duplicates of the original. Case stems from appeal by a robotics innovator.

The US Supreme Court has just made it significantly easier for inventors to protect their new ideas from people seeking to cash in on a similar product or service.

In a case with major implications for the vibrancy of American innovation, the justices yesterday unanimously overturned a federal appeals court decision that had made it difficult for patent holders to win patent-infringement cases involving anything but an exact duplicate of a protected design or process.

The decision involves an area of US law that is almost as complex as some of the inventions it seeks to protect. The basic premise of patent law is that new ideas have economic value and that the law can protect this value in a way that helps foster even more innovation and original thinking.

But patent law is designed not just to protect patent holders. It is also aimed at helping other inventors, innovators, and original thinkers to know with a degree of certainty which ideas are off limits under patent protection and which are available for use in the public domain.

Restoring flexibility to patent law

In essence, the court's decision is an attempt to strike a fair balance between these two competing interests.

It is a balance the appeals court had failed to preserve in its November 2000 ruling, according to the justices.

"The Court of Appeals for the Federal Circuit held that by narrowing a claim to obtain a patent, the patentee surrenders [the ability to later challenge a similar product]," writes Justice Anthony Kennedy for the court. "The Court of Appeals acknowledged that this holding departed from its own cases, which applied a flexible bar when considering what claims of equivalence were [halted]."

The court reestablished this flexible bar, mandating that judges must weigh competing factors rather than following bright-line rules that may not get to the essence of a patent dispute.

The decision stems from a patent-infringement suit filed in 1988 by a New York-based industrial equipment manufacturer, Festo Corp., against a Japanese company, Shoketsu Kinzoku Kogyo Kabuishiki, also known as SMC.

Festo developed and patented a device that helps to move items down an assembly line. In the suit, Festo charged that SMC had copied key parts of its design and engineering to produce and sell a device that was substantially equivalent to Festo's patented device.

Under the so-called doctrine of equivalents, patent holders are protected even when a suspected copied product or service may not be an exact duplicate of the invention but is nonetheless substantially equivalent to it.

Amending design as patent application pends

SMC countered that because Festo made certain changes during its patent application process, those changes could not be used by Festo to support its case against SMC.

A federal judge and a three-judge appeals court panel ruled against SMC. But the full US Court of Appeals for the Federal Circuit in Washington, D.C., reversed the decision, ruling in SMC's favor that any time an amendment narrowing a patent application is made, the doctrine of equivalents may not be invoked.

This was good news for certain members of the innovation community seeking clear guidance on how to navigate the tricky shoals of prior inventions and patent-infringement liability.

On the other side, it was bad news for some 1.2 million inventors holding patents, most of which had been amended as a routine part of the patent application process.

Critics of the appeals court ruling said it would establish a blueprint for risk-free patent theft. Would-be copyists might focus on key elements of a design that are amended in the application process. If they altered that element slightly, the patent holder would have been without legal recourse under the appeals court ruling.

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