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In a decisive reversal, the Federal Circuit handed Boston Scientific Corporation a complete victory in Board of Regents of the University of Texas System v. Boston Scientific Corp., vacating a jury verdict that had found Boston Scientific’s drug-eluting coronary stent infringed the University of Texas’s patent for drug-releasing biodegradable fiber implants. The Federal Circuit concluded that Boston Scientific was entitled to judgment as a matter of law (JMOL) on both anticipation and noninfringement — wiping out the almost $50 million damages award in favor of the University of Texas (UT) and ending the case.

Background

U.S. Patent No. 6,596,296 (the ʼ296 patent) generally relates to compositions containing at least one biodegradable polymer fiber in which a therapeutic agent is dispersed. The ʼ296 patent is directed to the controlled delivery of therapeutic agents — including anti-inflammatory compounds and long-term cardiovascular drugs — via biodegradable fibers that can be used in conjunction with commercially available stents. Claim 1, the representative independent claim, requires a composition with at least one biodegradable polymer fiber made up of two immiscible phases, i.e., the polymer portion of the fiber and the discrete drug-containing regions dispersed throughout the fiber:

A composition comprising at least one biodegradable polymer fiber wherein said fiber is composed of a first phase and a second phase, the first and second phases being immiscible, and wherein the second phase comprises one or more therapeutic agents.

UT sued Boston Scientific in 2017 in the Western District of Texas alleging that Boston Scientific’s drug-eluting coronary stent systems infringed the ʼ296 patent. Boston Scientific’s accused stent consists of a metal frame containing linked, serpentine (zigzag-shaped) rings coated with a liquid drug-containing biodegradable polymer coating that dries like paint and adheres to the outer surface of the metal frame. As the coating biodegrades, the drug of interest is released over time.

The case was ultimately transferred to the District of Delaware where, after a two-phase trial, the jury found that Boston Scientific infringed asserted claims 1, 11, 17, and 26 of the ʼ296 patent, that the claims were not invalid as anticipated by U.S. Patent No. 5,364,627 (Song), and that Boston Scientific’s infringement was willful. As a result, the jury awarded damages to UT in the amount of $42 million (plus ~$7.4 million in pre-judgment interest). The district court subsequently set aside the willfulness finding as legally unsupported but otherwise upheld the verdict.

Boston Scientific appealed and UT cross-appealed the rejection of the willfulness finding.

The Appeal

On appeal, a central question was whether Song — which Boston Scientific’s expert characterized as disclosing a fiber-based drug delivery system — anticipates the asserted claims of the ʼ296 patent. Song discloses a delivery system for the gradual release of an active agent (such as a drug or chewing-gum flavorant) from a fiber, with the agent dispersed throughout the fiber and released upon exposure to a solvent. Yet, the district court had credited UT’s expert testimony that Song is effectively a “chewing gum” patent with a manner of biodegradation relevantly different from the ʼ296 patent. The Federal Circuit rejected this characterization across all four asserted claims. More specifically, with respect to the biodegradable polymer fiber limitation of claim 1, the Federal Circuit found Song’s express disclosures compelling, e.g., Song teaches a “fiber having a support matrix” made of biodegradable polymers. Indeed, the appellate panel found no reasonable basis for restricting Song’s teachings in the way UT proposed, i.e., limited to chewing gum applications.

On the two-phases limitation, the Federal Circuit found that Song’s express disclosure that the active agent “does not necessarily have to be in a contiguous phase” directly teaches the claimed “discrete drug-containing regions.” And, despite UT’s expert’s attempts to distinguish Song’s mechanism of drug release from the asserted claims — arguing that Song releases drugs through channels exposed by chewing and deformation as opposed the ʼ296 patent’s radially release of drugs — the court found this argument unpersuasive and beside the point. In particular, the appellate panel explained that the district court’s claim construction of “second phase” does not require any particular mechanism of release, so evidence about how the drug releases does not address the actual claim requirement. On the immiscibility limitation, the appellate panel noted that Song itself expressly states that the active agent and the fibrous wall material “must be immiscible with each other,” and UT did not separately argue otherwise.

With respect to the “varying rates” limitation in claim 26, the uncontradicted testimony of Boston Scientific’s expert established that all drug delivery systems release agents at varying rates because it is “very, very difficult” to manufacture a system where the release rate does not change with time. In this aspect, UT presented no expert testimony to the contrary and offered no persuasive counterargument at oral argument. The panel found that UT’s own trial submissions further supported the conclusion. In fact, during closing argument, UT’s counsel described the chewing mechanism as producing varying deformations and varying openings where solvent contacts the active agent, which the panel read as implicitly acknowledging varying rates. The panel also noted that Song’s figures depicted openings of various sizes at the ends and sides of a fiber, which affirmatively corroborated Boston Scientific’s expert.

While its anticipation conclusion was sufficient to resolve the appeal, the Federal Circuit panel also addressed noninfringement. The district court had construed “fiber” to mean “a thread-like structure of any length or shape.” UT’s infringement theory did not rest on the stent as a whole but instead focused on the polymer coating stripped from the metal frame (more specifically, the portion of the coating covering one serpentine (zigzag) loop around the stent). The appellate panel found that no reasonable jury could characterize that artificially separated section of stent coating as “thread-like” and further noted that the coating in Boston Scientific’s stent is not a structure that ever had or would have independent existence. Rather, the coating is the result of adhering a liquid to the frame and letting it dry such that it is not meant to be stripped from its frame or to retain its form on its own. The resulting detached coating section is tubular in overall shape with zigzag walls, not essentially one-dimensional like a thread but visibly two-dimensional like a ribbon. The panel drew a pointed analogy to further explain its finding:

[O]ne cannot reasonably say that a uniform sheet of paper contains a narrow strip simply because one could cut such a strip from the paper.

Notably, UT’s expert admitted that he had not at any point in the case opined that the polymer coating on Boston Scientific’s stents is thread-like. On that record, the appellate panel found that Boston Scientific was also entitled to JMOL of noninfringement.

As a side note, a threshold issue on appeal was the standard of review. Anticipation is a question of fact, and noninfringement based on claim construction is reviewed for substantial evidence when a jury has made the underlying factual findings. Under that deferential standard, the Federal Circuit would uphold the jury’s verdict so long as it was supported by substantial evidence. Here, however, Boston Scientific did not directly challenge the jury’s factual findings. Instead, it appealed the district court’s denial of its renewed motion for JMOL. Because the Federal Circuit applies the procedural law of the regional circuit in which the case was tried, the standard of review for the JMOL denial was governed by 3rd Circuit law, which reviews JMOL denials de novo. Under de novo review, the appellate court examines the record anew and asks whether the evidence, viewed in the light most favorable to the verdict winner, permits only one reasonable conclusion — the one favoring the movant. This procedural posture proved critical: De novo review gave the Federal Circuit substantially more latitude to reexamine and ultimately reject the evidentiary basis for both the anticipation and noninfringement findings than it would have had under substantial evidence review.

The result here is a clean sweep for Boston Scientific. In the end, the fiber in the polymer composition claimed in the ʼ296 patent could not hold the verdict together any better than it could hold its shape off the stent. 

Takeaways

This case serves as a stark reminder that even multimillion-dollar jury verdicts can unravel on appeal — and that the procedural vehicle chosen for the appeal can be outcome-determinative. The Federal Circuit’s decision offers important guidance on the strategic significance of the standard of review, anticipation analysis, the scope of expert testimony in invalidity disputes, and the limits of infringement theories built on artificial claim-element constructions:

  • The procedural vehicle for appeal can be outcome-determinative. Boston Scientific appealed the district court’s denial of its renewed JMOL motion rather than directly challenging the jury’s factual findings. Because the Federal Circuit applies regional circuit procedural law, this meant the appeal was reviewed under the 3rd Circuit’s de novo standard for JMOL denials — not the more deferential substantial evidence standard that would have applied to a direct challenge to the jury’s verdict. Under substantial evidence review, the jury’s findings on anticipation and noninfringement — which were supported by UT’s expert testimony — might well have survived. The de novo posture gave the Federal Circuit the latitude to independently assess the sufficiency of the evidence and conclude that no reasonable jury could have found in UT’s favor. Appellate practitioners should carefully consider whether the procedural framing of an appeal can unlock a more favorable standard of review.
  • Expert testimony that misses the claim requirement cannot rescue a verdict. UT’s expert testified extensively about how Song’s manner of drug release differed from the ʼ296 patent, but claim construction imposed no limitation on the mechanism of release. The Federal Circuit was unsparing: Testimony about an unclaimed aspect of the invention provides no legally sufficient evidentiary basis to support the verdict. Before trial, patent owners must carefully map every element of expert testimony to the actual construed claim language, not just to the broader inventive concept.
  • Prior art is what it says, not how it’s used. UT tried to pigeonhole Song as a “chewing gum” patent with a narrow field of application. The Federal Circuit rejected this framing because Song itself expressly discloses “drugs” as an active agent and clearly is not limited to gum or saliva as a solvent. When a prior art reference expressly discloses broader uses — here, drugs as well as flavorants — courts will not artificially narrow its teachings based on certain embodiments. Patent owners should not optimistically rely on a narrow characterization of the purpose of a prior art reference to avoid anticipation.
  • Uncontradicted expert testimony on anticipation creates real risk. On the “varying rates” limitation of claim 26, Boston Scientific presented expert testimony that went entirely unrebutted by UT. The one-sided record proved fatal to UT’s attempt to avoid anticipation. When faced with credible expert testimony on a specific invalidity ground, patent owners should ensure they put forward affirmative counterevidence at trial, not just legal argument on appeal.
  • Infringement theories must rest on the accused product as it actually exists. UT’s infringement case required the jury to imagine a portion of a stent coating stripped from its metal frame and treated as an independent thread-like structure. The Federal Circuit made clear that this kind of artificial reconstruction, which relied on a hypothetically detached section of a product that was never meant to exist independently, is not sufficient. Infringement theories must be grounded in the accused product’s actual structure and function, not in what a component might look like if removed and reimagined. Patent owners must make sure that the infringement theory matches reality.
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A new rule from the USPTO took effect July 20, effectively ending foreign pro se patent prosecution: Patent applicants and patent owners whose domicile is outside the United States or its territories must now be represented by a registered patent practitioner — and, as we’ll see, even some U.S. citizens are caught by it.

Here is a breakdown of who the rule affects, how it applies, and why the USPTO adopted it.

Who the Rule Affects

The rule applies to both patent applicants and patent owners. Per the USPTO, a patent applicant includes any inventor, joint inventor, legal representative, person to whom the inventor has assigned (or is obligated to assign) their rights, or anyone else who shows sufficient proprietary interest to be named as an applicant. A patent owner is the person or entity that holds title to an issued patent, as reflected in USPTO assignment records.

The rule turns on domicile — in other words, an individual’s permanent legal place of residence or a juristic entity’s principal place of business. For an inventor-applicant, domicile is normally determined by the residence information in the application data sheet (ADS) and/or the inventor’s oath or declaration. For a non-inventor applicant, it’s normally based on the mailing address in the ADS’s applicant information section. Where an application has multiple applicants or owners with different domiciles, the representation requirement applies to the group as a whole if any one of them is domiciled outside the United States.

This is not a citizenship test. The USPTO has confirmed it does not collect citizenship information, since doing so would create a significant risk and administrative burden. That means a U.S. citizen who is permanently domiciled abroad is still treated as a foreign pro se applicant and remains subject to the new requirement. That also means that a non-U.S. citizen permanently domiciled in the U.S. can file pro se.

It’s worth noting that juristic entities (corporations, partnerships, government agencies, trusts, and the like) were already required to be represented by a registered patent practitioner, regardless of domicile, when acting as an applicant. This rule extends that same requirement to juristic entities acting as patent owners.

What the Rule Requires

Those who qualify must be represented by a registered patent practitioner: a patent attorney or patent agent registered under 37 CFR 11.6, or an individual granted limited recognition under § 11.9(a), § 11.9(b), or § 11.16.

This requirement applies to all filings, including new applications, amendments, replies, and other papers received on or after the effective date, regardless of when the underlying application was originally filed. In practice, that means a foreign pro se applicant who filed before the rule took effect will still need a registered practitioner to respond to the office going forward in that same application. A reply filed without one may require corrective action, but new applications will still be accorded a filing date under the conditions set forth in 37 CFR 1.53.

The rule does not require practitioner representation for paying maintenance fees or the basic filing fee. It does, however, still require a practitioner’s signature to certify micro entity status for a reduced fee.

Why the USPTO Adopted It

According to the USPTO, requiring foreign applicants/inventors and patent owners to be represented by a registered patent practitioner:

  1. Treats foreign applicants/inventors and patent owners the same way U.S. applicants/inventors and patent owners are treated in other countries;
  2. Increases efficiency, since the USPTO spends significant resources assisting pro se applicants;
  3. Enables the USPTO to more effectively enforce compliance with statutory and regulatory requirements in patent matters; and
  4. Enhances the USPTO’s ability to respond to false certifications, misrepresentations, and fraud.

Consistent with other recent rule changes under Director John Squires, the final rule is also aimed at reducing patent application pendency: Pro se applications generally require additional processing by the Office of Patent Application Processing (OPAP) and additional examination time from patent examiners on procedural matters.

The Bottom Line

Any applicant or patent owner domiciled outside the U.S. will need a registered patent practitioner to file and respond to the USPTO. If the new rule affects you, Bradley has a number of experienced attorneys registered to practice before the USPTO who can step in on patent drafting, filing, and prosecution.

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On Monday of last week, the Supreme Court of the United States granted a writ of certiorari to review the U.S. Court of Appeals for the Second Circuit’s decision in RiseandShine Corporation v. PepsiCo, Inc. At the center of the case: whether trademark strength is a question of fact in a likelihood-of-confusion analysis under 15 U.S.C. § 1114.

Before the Supreme Court hears oral arguments, it’s worth tracing this dispute’s path to the high court, starting at the district court.

At the District Court

RiseandShine launched a canned nitro-brew coffee in 2016 that uses “RISE” as a mark. It also registered RISE BREWING CO. as a word mark, Reg. No. 5,168,377, and its RISE BREWING CO. logo as a design mark, Reg. No. 5,333,635. In March 2021, Pepsi launched MTN DEW RISE ENERGY, with “RISE” across the top of the can in a large, jagged font.

When RiseandShine filed suit against Pepsi in the U.S. District Court for the Southern District of New York, it moved for and was granted a preliminary injunction. The preliminary injunction blocked PepsiCo from using or displaying the mark, pending trial. RiseandShine’s primary winning argument at the district court level was that Pepsi’s use of “RISE” was likely to cause confusion with its own mark. Pepsi appealed to the 2nd Circuit U.S. Court of Appeals.

In the Second Circuit Court of Appeals

In its decision on likelihood-of-confusion, the appellate court focused on the strength-of-the-mark factor, which is one of the most important factors a court must weigh (as discussed in a June 22 blog post).

In the second circuit, the strength of a trademark is assessed based on either or both of two components: (1) the degree to which it is inherently distinctive and (2) the degree to which it has achieved public recognition in the marketplace. The more inherently distinctive and recognizable, the stronger the mark. Trademark law utilizes four categories to describe different degrees of inherent distinctiveness: (1) generic, (2) descriptive, (3) suggestive, and (4) arbitrary or fanciful. Suggestive marks hint at the product without naming it outright, sometimes requiring a bit of imagination to make the connection.

The 2nd Circuit agreed with the district court that Rise Brewing’s mark is “suggestive.” But instead of treating that as a strength, the court found that the close association between “Rise” and coffee actually made the mark weaker. The court also found that RiseandShine hadn’t shown enough acquired strength to offset that weakness, partly because other brands were already using “Rise” on coffee and similar products before RiseandShine adopted its mark. With that, the 2nd Circuit sent the case back down to the district court.

On Remand in District Court

After discovery on remand, Pepsi moved for summary judgment, arguing there was no trademark infringement. The district court agreed, holding that the RISE marks are “inherently weak as a matter of law” under the 2nd Circuit’s binding conclusion. RiseandShine appealed.

Second Circuit Summary Order

Back at the 2nd Circuit, RiseandShine argued that the district court arrived at its conclusion by impermissibly analyzing the strength-of-mark factor as a question of law and disregarding material facts regarding the mark’s acquired strength. The 2nd Circuit found both arguments unpersuasive, as it has long held that the balancing of the likelihood-of-confusion factors is a question of law.

Writ of Certiorari Arguments

That sets up the fight now before the high court. RiseandShine petitioned for cert, arguing that the 2nd Circuit’s decision rested on what it viewed as a legal conclusion, but analyzing how strong or weak the association is between a trademark (“RISE”) and a product (coffee) is the type of fact-intensive issue involving consumer perception reserved for the trier of fact. RiseandShine further argues that the common theme of all circuits, aside from the 2nd Circuit, is that the entire analysis of a mark’s conceptual strength is a question of fact.

Pepsi argues in opposition that trademark strength consists of two subcomponents, acquired strength and conceptual strength, and there is no circuit split on acquired strength, which all courts treat as factual. Regarding conceptual strength, Pepsi argues that, as in other circuits, a mark’s level of distinctiveness is only the starting point for the 2nd Circuit’s conceptual-strength analysis. That further analysis requires legal judgment, and Pepsi argues no circuit treats that further inquiry as a question of fact.

Beyond the Bench

It is difficult to predict the Supreme Court’s leanings either way, but a decision will impact almost all trademark cases going forward. A ruling for RiseandShine may require a fact finder in each infringement analysis. This could result in more lengthy and expensive trials but may give more weight to the judge or a jury in district court who makes the determination based on presented evidence. A ruling for Pepsi could change how other federal courts approach trademark cases, leading to more uncertainty as judges across the circuits enact new infringement analyses.

The schedule for oral arguments has not been announced, but we will update you when they occur.

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As drag has risen in pop culture, trademark law has become an unlikely topic of conversation. Most recently, on May 27, Pattie Gonia, an internet-famous drag queen and environmental activist, urged her more than 1.8 million social-media followers to ask Patagonia to drop its lawsuit.

Patagonia is a California-based company that makes climbing apparel and sportswear. The brand has used the Patagonia name on its clothing since the early 1970s, taking its name from the Patagonia region of southern Argentina and Chile. The company owns a series of trademarks at issue, including PATAGONIA in Registration Number 1189402 for certain clothing and in Registration Number 6665425 for education and entertainment services related to events on environmental issues.

Pattie Gonia is the drag queen alter ego of Nebraska-born Wyn Wiley, owner of Entrepreneur Enterprises Inc. (d/b/a Pattie Gonia Productions). Wiley first adopted the Pattie Gonia persona in October 2018 in a video promoting outdoor activism, and the character has since risen to international fame. In 2024, Wiley began selling Pattie Gonia merchandise, including t-shirts and stickers, through his website, and he has completed several tours under the Pattie Gonia name. Entrepreneur Enterprises filed an application, Serial Number 99404728, in 2025 to register PATTIE GONIA as a trademark for goods and services, including clothing and entertainment services.

The Dispute

In January 2026, Patagonia filed a complaint against Entrepreneur Enterprises, Inc. and Wyn Wiley, alleging, among other claims, federal trademark infringement under 15 U.S.C. §§ 1114-1117. The complaint asserts that the use of PATTIE GONIA is likely to cause consumer confusion with Patagonia’s registered marks. Across all claims, Patagonia seeks nominal damages of $1, attorneys’ fees, an injunction barring further use of the PATTIE GONIA mark and similar designs, and an order blocking the trademark application.

In April, Wiley answered the complaint, denying the allegations and asserting 12 affirmative defenses, including protection under the First Amendment and the Rogers v. Grimaldi doctrine covering expressive works.

Considerations for the Court

Under Rogers v. Grimaldi, a trademark infringement claim targeting an expressive work must be dismissed unless the complainant (here, Patagonia) can show either (1) that the challenged use of a mark “has no artistic relevance to the underlying work” or (2) that it “explicitly misleads as to the source or the content of the work.” This test, however, as the Supreme Court held in Jack Daniel’s Properties v. VIP Products LLC and as we discussed in our blog post on June 9, 2023, does not protect using a parody as a brand name.

Some facts place Wiley under the protection of Rogers. For instance, Wiley’s cheeky clothing accoutrements or fan-made apparel that mimic Patagonia’s logo have never been for sale. However, Wiley’s intent to register PATTIE GONIA as a trademark and to use the mark as a source indicator for stickers, shirts, and tours likely prevent protection under Rogers.

Should Rogers not apply, a likelihood-of-confusion analysis follows. Ninth Circuit courts weigh likelihood-of-confusion through eight Sleekcraft factors, but three tend to drive the result: (1) the strength of the plaintiff’s mark; (2) the degree of similarity between the marks; and (3) the proximity of the products. As in Jack Daniel’s, parody is not a separate consideration; rather, a successful parody is one that, under these factors, would not be confused with the original. No side needs all of the factors in their favor, but the court must weigh them to arrive at its judgment. The parties’ initial filings suggest the following considerations with respect to three key factors:

  1. Strength of the plaintiff’s mark – favors Patagonia. Although the Patagonia mark references a widely known South American region, it is distinctive and long-standing in the U.S. apparel market with few similar marks crowding the field.
  2. Degree of similarity between the marks – favors Patagonia. Patagonia owns a word mark, so use of the word, however it is styled, could constitute infringement, and in sight and sound, PATAGONIA and PATTIE GONIA are similar.
  3. Proximity of the products – close call. Both parties sell shirts and stickers and stage environmental-themed events, so the products overlap on their face. However, Wiley’s apparel line has been discontinued, and his drag performances overlap with Patagonia’s environmental events in theme alone since the brand has never taken the stage in heels and a wig.

Based on the initial filings, the factors appear to favor Patagonia. However, as Wiley argues, who would confuse a drag queen with a global brand? On the current scheduling order, the court likely won’t get to this question until at least mid-2027.  

Beyond the Bench

Patagonia risks losing its trademark. A single lookalike may not seem destructive, but every unchallenged use chips away at what the brand stands for. To protect their rights, companies must police infringement.

Pattie Gonia stands to lose earnings. If the court limits commercial use of the Pattie Gonia name, the loss of revenue could threaten Wiley’s ability to make a living and fund environmental work.  

Drag culture could shift. As the art form goes mainstream, more performers are expanding into merchandise sales, so a ruling for Patagonia would change the ways in which many of them name and market themselves.

Whatever the outcome, the decision could reshape how brands and drag performers across the country protect and present their names.

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In Ollnova Technologies Ltd. v. ecobee Technologies ULC, the Federal Circuit handed Ollnova a string of doctrinal wins — three of its four patents cleared the patent eligibility hurdle under 35 U.S.C. § 101 — only to throw out the entire $11.5 million verdict over a single defect in the verdict form. This decision serves a sharp reminder that in a multi-patent jury trial, how you ask the question can matter as much as the answer.

The Background

Ollnova sued ecobee in the Eastern District of Texas (before Judge Rodney Gilstrap) on four patents covering wireless building automation systems (BAS)— U.S. Patent Nos. 7,860,495 (’495 patent), 8,264,371 (’371 patent), 7,746,887 (’887 patent), and 8,224,282 (’282 patent). The patents-in-suit address familiar challenges in wireless control networks: noisy channels, limited bandwidth, and the power drain that comes from devices constantly monitoring and broadcasting data. The asserted claims describe techniques for cutting down on unnecessary communications — transmitting only when a monitored value changes or crosses a threshold, and aggregating updates rather than streaming them continuously.

At trial, the jury returned a verdict of infringement as to at least one of the asserted patents and invalidity of the ʼ282 patent and awarded Ollnova a single $11.5 million lump-sum reasonable royalty.

The Appeal

Both sides appealed with ecobee challenging the verdict form, the Section 101 rulings, and the denial of its non-infringement judgment as a matter of law and Ollnova challenging the prejudgment interest. The panel — Judges Raymond Chen (who authored the opinion), Tiffany Cunningham, and Leonard Stark — split the difference in a way that left Ollnova with nothing to collect, let alone any extra prejudgment interest.

The decision that unraveled the trial had nothing to do with the technology. The verdict form asked the jury a single, combined question — whether ecobee infringed “any of the Asserted Patents” — rather than asking about each patent separately. The Federal Circuit held that this was an abuse of discretion under its 2025 decision in Optis Cellular Technology v. Apple (vacating an infringement judgment finding that the verdict form, which used a single combined infringement question even though multiple patents were asserted, created an unacceptable risk of a non-unanimous general verdict).

Similar to Optis, the problem here is that, with a single combined question on the verdict form, there is no way to tell whether all the jurors agreed on the same patent. Indeed, some jurors might have found infringement of the ʼ495 patent, others the ʼ887 patent, and still others the ʼ371 patent. Yet, the verdict form would reflect a unanimous “yes” even though no single patent actually would have commanded a unanimous vote. This implicates the Seventh Amendment right to a unanimous civil verdict, and general instructions telling the jury to be unanimous do not cure a form that makes non-unanimity invisible. Because ecobee had preserved the objection, the appellate panel vacated the infringement judgment — and with it, the entire $11.5 million damages award, which had been entered as a single lump sum that could not be tied to any particular patent.

On eligibility, the panel’s treatment split along patent lines. The ʼ495 patent — directed to a wireless building control architecture — drew the most scrutiny. The district court had found at Alice step one that the claims were directed to an abstract idea: “controlling generic components using information from two separate sources (two separate networks).” The eligibility question then went to the jury at step two, and that is where things went wrong.

The Federal Circuit held that the jury instruction and verdict form on Section 101 were erroneous and not harmless. The instruction asked the jury to decide whether the claim elements were “well-understood, routine, and conventional” — the classic step-two inquiry — but never told the jury what the abstract idea was, nor that an abstract idea cannot itself supply the “inventive concept” that saves a claim. The appellate panel explained that the error in the jury instruction was not harmless because Ollnova’s expert had built his “inventive concept” testimony around the very “two modes of control” that the district court had identified as the abstract idea. As a result, the jury may well have credited the abstract idea itself as the inventive concept. The panel vacated and remanded for a proper step-two analysis on the ʼ495 patent. It also affirmed the denial of ecobee’s JMOL of ineligibility of the ʼ495 patent. So, the ʼ495 patent lives to fight another day on remand.

The ʼ887 and ʼ371 patents fared far better under appellate § 101 scrutiny. The panel affirmed that the claims of both patents are not directed to an abstract idea at Alice step one, never needing to reach step two. The throughline was the court’s long-running distinction between claims that merely recite a result and claims that recite “a technological solution to a technological problem.”

For the ʼ887 patent, representative claim 1 recites a controller that monitors a sensor parameter only during a polling interval and transmits that parameter only during a transmission interval and only when the value falls outside a predetermined range. Those timing constraints and the conditional transmission trigger, the panel explained, are a specific technique for reducing communications in noisy, bandwidth-limited BAS networks — not a generic data-handling concept. The court distinguished these claims from other precedential decisions where the claims changed nothing about how data was collected or transmitted or a “predetermined threshold” did not alter the abstract focus of a human-mind matching process.

The claims of the ʼ371 patent recite aggregating change-of-value (COV) messages from multiple devices into a single push “update” and then repeating that communication until a change-of-value acknowledgement is received. The panel was notably unimpressed by ecobee’s “human-driven analogies” (a friend who calls when the temperature drops below 70°, a landlord who relays temperature complaints), faulting ecobee for characterizing the claims at a high level of abstraction “untethered from the language of the claims.” It explained that the claims of the ʼ371 patent were eligible under § 101 because a specific operational change yielded a functional improvement — reduced bandwidth and resilience against communication failures. In addition, the panel affirmed the denial of ecobee’s non-infringement JMOL on the ʼ371 patent. Even under ecobee’s narrower reading — that the claims require repeating the exact same message — substantial evidence supported the jury’s verdict. In sum, the ʼ887 and ʼ371 patents keep their eligibility, and the ʼ371 patent keeps its infringement verdict.

The panel also dismissed Ollnova’s prejudgment-interest cross-appeal and ecobee’s remaining Daubert challenges. Tallied up, even though Ollnova won most of the doctrinal battles, with the overall infringement and damages judgments both vacated, it still lost the war — at least for now. The net result: a $11.5 million verdict reduced to zero and a return trip to Texas.

The Takeaways

This decision is more about trial mechanics than patent eligibility doctrine, though there is still room for a few practical lessons on both fronts:

  • In a multi-patent case, give the jury a separate verdict question for each patent. A single combined infringement question invites a non-unanimous verdict that no instruction can fix. The same logic counsels against a single, undifferentiated lump-sum damages award that cannot be allocated among patents if one falls away.
  • If Section 101 goes to the jury, the instruction has to do step two correctly. Telling the jury to ask whether elements are “well-understood, routine, and conventional” is not enough; the instruction must identify the abstract idea and make clear that the abstract idea cannot itself be the inventive concept.
  • To survive Alice step one, claim a specific technique, not a result. The ʼ887 and ʼ371 patents cleared eligibility because they recited concrete operational constraints — polling and transmission intervals, conditional transmission, aggregated push updates, repeat-until-acknowledged — that changed how the network communicated. Result-oriented claims and tidy human-world analogies tend to lose; particularized technical limitations tend to win.

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On October 17, 2025, USPTO Director John Squires issued a memorandum announcing that he would be sole decision-maker for institution of inter partes review (IPR) and post-grant review (PGR) proceedings. In this same memo, Squires stated those decisions would be determined “based on discretionary considerations.” In the time since, Squires has used a series of decisions to articulate his view of the purpose of these types of proceedings and how it shapes his discretionary analysis. Most recently, in Magnolia Medical Technologies, Inc. v. Kurin, Inc., IPR2026-00097, Squires reiterated his stance that discretionary authority will be used to narrow AIA review to its regulatory purpose.

Squires’s previous decisions, taken together with Magnolia Medical, offer a prescreening checklist for practitioners considering whether to file an IPR petition. As discussed in our May 6th blog post, this discretion is generally nonreviewable. Therefore, failing to work through this checklist before investing in a petition may be costly.

  1. Was the patent previously litigated?
    Squires has repeatedly emphasized that the primary purpose of AIA proceedings is “to provide a quick and cost-effective alternative to district court patent litigation for resolving disputes over patent validity.” Petitioners looking to relitigate or to attempt a different strategy at the USPTO are likely out of luck, as the director sees this as “a second bite at the apple.”

    In Magnolia Medical, the patent at issue (U.S. Patent No. 12,138,052) was previously challenged in district court, where a jury found it not invalid. Magnolia’s subsequent IPR petition again challenged the patent’s validity, arguing that the grounds being presented in the petition were not presented to the jury because the court had excluded the proffered expert testimony concerning those references. Squires declined institution in the face of a jury finding upholding validity, regardless of whether the petitioner was precluded from litigating obviousness and anticipation in the district court.

  2. Can multiple petitions be combined into a single petition?
    Squires is of the view that parallel petitions on the same claims should be rare.

    In PacifiCorp v. Birchtech Corp., IPR2025-00687, -00688, -00717, -00718, PacifiCorp filed four petitions, two for each asserted patent premised on different possible priority dates. Squires vacated institution and remanded for each of the four decisions because he believed the multiple petitions created “a substantial and unnecessary burden on the Board and the patent owner[,] and could raise fairness, timing, and efficiency concerns.”

  3. Is the litigation interpretation different from the AIA review interpretation?
    To conserve the USPTO’s resources and avoid duplicative litigation, Squires has limited the use of IPR proceedings to advance positions inconsistent with those taken in parallel forums.

    In Revvo Techs., Inc. v. Cerebrum Sensor Techs., Inc., IPR2025-00632, the petitioner advanced a claim construction inconsistent with its district court position and offered no explanation, prompting the director to vacate institution.

  4. Are you a proper real-party-in-interest?
    As the Supreme Court held in Return Mail Inc. v. United States Postal Serv., 587 U.S. 618 (2019), the U.S. government cannot seek IPR. Squires extended that holding to reach foreign governments in Tianma Microelectronics Co. v. LG Display Co., IPR2025-01579, including cases where a foreign government is a real-party-in-interest.

  5. Has the patented device been in commerce for many years?
    Building on a position first articulated by former Acting Director Coke Morgan Stewart, Squires has held that the length of time a patent has been in force weighs against institution of an IPR.

    In cases such as Dabico Airport Sols. Inc. v. AXA Power ApS, IPR2025-00408, where the patent had been in force for many years, Squires declined to institute. By contrast, in Home Depot U.S.A., Inc. v. H2 Intellect LLC, IPR2025-00480, where the patent had not been commercialized, asserted, licensed, or otherwise applied in the petitioner’s technology space, Squires allowed the petition to proceed.

    If the answer to any of the above is yes, the petitioner should seriously reconsider investing time and money in an AIA review — unless the answer to the following is also yes.

  6. Was there USPTO error?
    The trump card is USPTO error, i.e., a substantial showing of error by the office during examination that overcomes other factors weighing in favor of discretionary denial.

    In Padagis US LLC v. Neurelis, Inc., IPR2025-00464, despite parallel litigation in district court, Squires declined to exercise discretionary denial. Because the examiner’s priority-date determination contradicted an earlier PTAB ruling, raising concerns of material error, the director found that “it is an appropriate use of Office resources to review the potential [material] error” by the office.

While no factor is dispositive, the director can terminate a proceeding even after a final written decision, as in Verizon Connect Inc. v. Omega Patents, LLC, IPR2023-01162, Paper 40 (June 3, 2025), so working through these questions before investment is made is a must.

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In Hikma Pharmaceuticals USA Inc. v. Amarin Pharma, Inc. (June 4, 2026), a unanimous Supreme Court has further clarified what it takes to plead — and ultimately prove — that a defendant induced another party to infringe a patent, setting a high bar for induced infringement claims. While the case arose in the context of generic pharmaceutical medications, the decision is framed around the general induced infringement statute, 35 U.S.C. § 271(b), and the impact of the Court’s reasoning will be felt well beyond pharmaceutical patents.

Induced Infringement: A Brief Primer

Understanding what induced infringement is (as opposed to direct infringement) is important to understanding the case.

A party directly infringes a patent by practicing the patented invention — “whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.” 35 U.S.C. § 271(a). Section 271(b) extends patent liability one step further:

“Whoever actively induces infringement of a patent shall be liable as an infringer[,]” specifically designed to catch defendants who don’t directly infringe themselves but who encourage, instruct, or facilitate direct infringement by others.

What does inducing infringement look like?

  • A software vendor whose documentation walks users through steps that, taken together, practice all the steps of a patented process.
  • A widget manufacturer who advertises a product’s features by specifically highlighting the functionality covered by a competitor’s patent.

In these situations, the defendant isn’t the one doing the (direct) infringing — a third party (the customer, the user, some downstream actor) is — but it is the defendant who is inducing the ultimate act of infringement.

Induced infringement has a specific intent requirement. The Supreme Court made clear in Global-Tech Appliances, Inc. v. SEB S.A. (2011) that inducement requires not just knowledge of the patent but also the defendant’s knowledge that it was encouraging infringement — i.e., that it had the specific intent to cause infringing acts. (To be clear, the “specific” intent requirement may also be met by showing “willful blindness” — proof that the defendant subjectively believed there was a high probability that the patent existed and that their acts constituted infringement or that the defendant took deliberate actions to avoid learning of the patent’s existence.”)

The question the Court answered in Hikma v. Amarin is what an inducement plaintiff must actually allege to get its inducement claim past a motion to dismiss.

The Case That Raised the Question

While this decision isn’t limited to the inducement of pharmaceutical-related patents, some understanding of the facts of the case are helpful even if your primary interest is outside the pharmaceutical space.

Amarin markets Vascepa®, a medication with two FDA-approved uses. The first, approved in 2012, was treating severe hypertriglyceridemia — dangerously high blood triglyceride levels. Amarin originally patented this use of its medication, but Hikma had these patents invalidated in separate litigation. The second use, approved later (but prior to the Hikma invalidation of the original Vascepa patents), was for reducing the risk of heart attack and stroke in patients with elevated cardiovascular risk, a use covered by a later set of Amarin patents (the ones at issue in the litigation), and that use generated billions of dollars in annual sales of Vascepa for Amarin.

When Hikma sought FDA approval to sell a generic version of Vascepa, it used a mechanism permitted under the Hatch-Waxman Act: It carved the patented cardiovascular indication out of its proposed label, seeking approval only for the older, now-unpatented use of treating severe hypertriglyceridemia. This is called a “skinny label.” The logic is that a manufacturer selling a generic product only for a non-patented purpose shouldn’t be liable for a patent covering a different purpose or method of use.

Hikma’s skinny label was legally compliant. But Amarin sued anyway, arguing that Hikma’s marketing and communications — outside the label itself — amounted to inducing infringement of its cardiovascular method-of-use patents. Hikma’s conduct that was the subject of the inducement complaint (and undisputed)  fell into three categories: (1) Hikma’s label, while not naming the cardiovascular indication, included clinical data from studies involving cardiovascular patients and noted cardiovascular risk factors, which Amarin argued would signal physicians that the drug could be used for cardiovascular purposes; (2) Hikma’s press releases and website describing its product as a “generic version” of Vascepa, a brand whose dominant use was the patented cardiovascular indication; and (3) Hikma cited Vascepa’s total sales figures, including sales driven by the patented cardiovascular use.

The District of Delaware dismissed the complaint for failure to state an induced infringement claim. The Federal Circuit reversed the dismissal, finding it “at least plausible that a physician could read” the totality of Hikma’s statements “as an instruction or encouragement to infringe.”

What the Supreme Court Held

The Supreme Court reversed the Federal Circuit and remanded the case.

Writing for the Court, Justice Ketanji Brown Jackson applied the pleading standard from Bell Atlantic Corp. v. Twombly (2007) and Ashcroft v. Iqbal (2009) and drew a sharp distinction at the core of § 271(b): The question is not whether a plaintiff can construct a reading of the defendant’s statements under which they might be understood by the direct infringer as instructions to infringe. The question is whether the complaint plausibly alleges that the defendant actively encouraged the infringing use — that it affirmatively promoted conduct it knew to be infringing.

In finding error by the Federal Circuit, the Court framed “the central question” as “whether Amarin plausibly alleged that Hikma actively encouraged infringing uses, not merely whether doctors could plausibly read the alleged statements as instructions to infringe.” Amarin argued “that it need not do more than allege . . . a plausible chain of events through which statements made by [Hikma] could lead a healthcare provider . . . to prescribe or dispense Hikma’s drug to reduce a patient’s cardiovascular risk” — an infringing use. The Court acknowledged that this argument “reflects the recent approach of the Federal Circuit, which has increasingly trained its focus on whether the relevant statements could be read by medical providers as instructions to infringe.” However, in the strongest of terms, the Court rejected this reasoning: “We reject that trend today, and hereby emphasize that the key question is whether a defendant actively encouraged infringement through its statements, not merely how others may understand those statements.”

This is a meaningful distinction. The Federal Circuit’s “trend” towards a totality-of-conduct approach had allowed courts to aggregate ambiguous statements, industry context, and downstream market behavior to construct a cumulative picture of inducement. The Supreme Court has now rejected that framework as fundamentally inconsistent with the specific intent required by § 271(b). Because of this decision, it is now seemingly very clear that passive awareness that one’s product may or even will be used in an infringing manner — even widespread, predictable infringing use — is not enough. Instead, what is required is affirmative, active encouragement of the infringing act itself.

The Court’s Broader Framework for § 271(b)

Because the Court chose to ground its analysis in § 271(b) rather than in the Hatch-Waxman Act’s specific provisions, the opinion amounts to a statement about induced infringement law generally. Several aspects of the analysis are significant for all induced infringement cases, not just pharmaceutical ones.

Pleading specificity matters. The Court held that a complaint alleging induced infringement must identify specific conduct by the defendant that affirmatively encourages the infringing use — not merely conduct that is consistent with encouraging infringement among a set of plausible explanations. This raises the bar at the motion-to-dismiss stage meaningfully above where the Federal Circuit would have allowed the allegations of the complaint to succeed.

Context cannot substitute for affirmative content. Amarin had argued that Hikma’s statements, read against the backdrop of Vascepa’s market (dominated by the patented cardiovascular use), were effectively communications about the patented indication even if they didn’t say so explicitly. The Court rejected this argument. The relevant question is what the defendant said and did, not how an industry-sophisticated observer might decode it given surrounding market conditions. Allowing ambient context to supply the missing element of active encouragement would, the Court warned, make induced infringement liability unpredictable and overbroad. However, it bears noting that the Court also rejected Hikma’s argument that active inducement must be “express” — “[a] defendant can achieve active inducement through implicit encouragement … [.] But implicit or explicit, the necessary inducement must be ‘clear’ to the relevant audience and ‘affirmative.’” Statements that have an “obvious alternative explanation” — such as compliance with the law or with standard industry practice — may not rise to the level of active inducement.

The Bottom Line

The Court’s holding in Hikma v. Amarin — that a complaint must plausibly allege affirmative, active encouragement of infringing use, not merely conduct from which encouragement could be inferred in context — at minimum raises the pleading bar for induced infringement cases across the entire patent system. While the case happened to arise from a pharmaceutical dispute over a skinny label, the Court’s analysis is not about pharmaceuticals or FDA labels or the Hatch-Waxman Act. It is about what it means to induce patent infringement, and the answer it gives — you must affirmatively promote the infringing act, not merely sell a product knowing others may infringe with it — is further clarification of the boundaries of indirect infringement claims in IP cases consistent with  the Court’s recent decisions clarifying the boundaries of contributory copyright infringement, discussed here and here.

Hikma Pharmaceuticals USA Inc., et al. v. Amarin Pharma, Inc., et al., No. 24-889. Decided June 4. Opinion by Justice Ketanji Brown Jackson for a unanimous Court.

This post is for informational purposes only and does not constitute legal advice.

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On June 2, 2026, the Federal Circuit issued a precedential decision in AGI SureTrack LLC v. Farmers Edge Inc. that delivered a split result — and a reminder that winning a patent case is not the same thing as collecting fees for it. The panel (Judge Haldane Robert Mayer, writing, joined by Chief Judge Kimberly Moore and Judge Alan Lourie) affirmed the District of Nebraska’s summary judgment that AGI’s asserted patents claim ineligible subject matter under 35 U.S.C. § 101. But the court vacated and remanded the district court’s separate determination that the case was not “exceptional” under 35 U.S.C. § 285, faulting the lower court for entering that ruling sua sponte and without any explanation. In short, Farmers Edge won the patent challenge but, for now, walks away with only its costs. The harvest, it turns out, is not yet in. Let’s dig into the dirt.

Background

AGI SureTrack LLC owns a family of patents — including U.S. Patent No. 11,126,937 — directed to automated systems for capturing, processing, and sharing farming data in real time. The technology centers on a “relay device” that attaches to farming equipment and pulls operational data off the machine’s message bus while the equipment works the field. Claim 1 of the ’937 patent, treated as representative, features a relay device that includes familiar parts — a microprocessor, a bus connector, a GPS receiver, and a memory storage area — along with software that matches the equipment to a stored “implement profile,” decodes its messages, and records the farming operation in an electronic farm record.

AGI sued Farmers Edge Inc. and Farmers Edge (US) Inc. in the District of Nebraska for infringing claims of the ʼ937 patent, as well as claims of U.S. Patent Nos. 10,963,825, 11,164,116, 11,361,261, and 11,507,899. In April 2024, the district court granted Farmers Edge summary judgment, holding the asserted patents directed to patent-ineligible subject matter under § 101. The court described the claims as using “generic (‘off the shelf’) computers and sensors to collect data from standard farm implements” and found nothing in the elements — alone or in combination — that transformed the abstract idea into an inventive concept as required under § 101. In the same summary judgment order, the court also determined that the case was not exceptional for purposes of an attorneys’ fees award under § 285. AGI appealed the eligibility ruling; Farmers Edge cross-appealed the no-exceptionality determination.

The Federal Circuit’s Analysis

Eligibility: An old idea even when narrowed to a farm is still abstract

Applying the two-step Alice framework, the panel agreed with the district court at both steps. At step one, AGI argued its claims solved a real-world “interoperability” problem among different brands of farm equipment that encode data differently. The court was not persuaded — noting first that nothing in the claims actually mentions interoperability and, second, that even crediting AGI’s framing, claims reciting “generalized steps of collecting, analyzing, and presenting information, using nothing other than the conventional operations of generic computer components, are directed to abstract ideas.” Limiting the data to a particular variety (here, farming data) does not save them: “an abstract idea remains an abstract idea even when narrowed — e.g., by subject matter — to a particular use or environment.” Replanting an old idea in a new field, in other words, does not make it a new crop. The “implement profiles” AGI leaned on were, in the court’s view, just one set of data used to decode another set of data, which “merely adds one abstract concept to another.”

At step two, the panel’s search for an inventive concept came up empty — a field plowed with nothing left to reap. The claims relied on generic components — microprocessor, bus connector, GPS receiver, memory — used in a conventional way, and the only real advantage AGI could point to was speed. But “the improved speed inherent with applying [an] abstract idea using a computer” does not supply an inventive concept. With no specific improvement to computer functionality disclosed, the court affirmed the ineligibility ruling.

Exceptionality: The appellate panel can’t review a ruling that explains nothing

This is where the decision earns its keep for fee-motion watchers. On the cross-appeal, Farmers Edge argued the case was exceptional under § 285 for a litany of reasons — alleged inequitable conduct during prosecution, misleading statements about abandoned claims, improper litigation tactics, and violations of court-issued protective orders. The problem was not the merits of those arguments; it was that the district court never reached them on the record. It entered the no-exceptionality ruling sua sponte, in terse fashion, without giving Farmers Edge an opportunity to present argument and evidence — and without explaining its reasoning. The lower court, in effect, harvested the conclusion without ever tilling the ground beneath it.

Citing Octane Fitness, the panel reaffirmed that an exceptional case is “one that stands out from others” on the substantive strength of a party’s position or the unreasonable manner of litigation, judged on the totality of the circumstances. While the court acknowledged it does not always require a district court to spell out why a case is not exceptional — sometimes the record speaks for itself — here there was “nothing in the district court’s terse no exceptionality ruling or the record on appeal” that would allow meaningful appellate review for abuse of discretion. Following Superior Fireplace, Energy Heating, and Innovation Technologies, the court vacated and remanded with instructions that the district court reassess exceptionality after giving both sides an adequate opportunity to be heard — sending the question back to be properly cultivated before any fee award is reaped.

The court also handed Farmers Edge a procedural lifeline. AGI argued that Farmers Edge had forfeited any fees claim by not moving within 14 days of the original judgment under Rule 54(d)(2)(B). The appellate panel disagreed and explained that under the Rule’s 1993 Advisory Committee Note, a new 14-day filing period “will automatically begin if a new judgment is entered following a reversal or remand by [an] appellate court.” Because the panel was vacating and remanding, a fresh 14-day window for a fee motion will open for Farmers Edge once the district court enters judgment on remand — a second season to sow its fees claim.

Key Takeaways

  • New ground does not always make an old idea bloom. Limiting data-collection-and-analysis claims to a particular field — here, farming — does not automatically transform an abstract idea into eligible subject matter.
  • A faster tractor moving over the same field harvests nothing new. Having a computer perform routine tasks more quickly or more accurately is not enough to make a claim patent eligible — speed alone is not an inventive concept at Alice step two.
  • Clearing the back forty does not necessarily mean the barn gets built. An Alice-based summary judgment is a merits victory, but it does not by itself make a case “exceptional.” The § 285 inquiry is separate and turns on the totality of the circumstances under Octane Fitness — clearing the back forty does not necessarily mean the barn gets built.
  • You cannot expect a prize at the county fair for a pie when no one can see the recipe. A district court that finds a case unexceptional under § 285 must give “some indication of the reasoning underlying its decision.”

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Determining the amount of disclosure sufficient to satisfy the written description and enablement requirements of 35 U.S.C. § 112(a) can be difficult, especially in the fields of biotechnology, pharmaceuticals, and other unpredictable arts. In a recent precedential decision from the Federal Circuit (Teva Pharms. Int’l GmbH v. Eli Lilly & Co.), the appellate court identified circumstances where disclosing a single species satisfied the written description and enablement requirements for a genus of humanized antibodies in a patent claim directed toward a method of treatment for headaches.

Background

Teva Pharmaceuticals owns three patents (the “headache patents”) directed to methods for treating headaches in humans using mouse antibodies that have been converted into a form the human immune system will not reject (a process called humanization). The specifications of the headache patents observed that the specific mouse antibodies, and how to make them, were “known in the art” and cited examples of mouse antibodies being sold. The specifications also disclosed prior-art methods of humanization but disclosed just one humanized antibody (“G1”) that was the active ingredient in Teva’s product.

Teva sued Eli Lilly & Co in the U.S. District Court for the District of Massachusetts for infringement of the headache patents, and a jury found Lilly willfully infringed the headache patents and awarded Teva damages. However, the district court overturned the jury’s verdict concluding that, as a matter of law, the asserted headache patent claims were invalid for failing to satisfy the written description and enablement requirements. Teva appealed to the Federal Circuit.

The Federal Circuit’s Analysis

The Federal Circuit addressed the written description requirement first, acknowledging that “what it takes to satisfy that requirement varies depending on the context, including the nature and scope of the claims.” Adequate written description to support claims involving a genus require disclosure of “a representative number of species” within the genus, but there are no bright-line rules governing how many species constitute a “representative number.” Lilly argued that the disclosure of only one species, G1, of the claimed genus of humanized antibodies in the headache patents could not be sufficient disclosure.

The court rejected Lilly’s argument, highlighting that the claim was directed at using the genus to treat headaches, instead of claiming the genus itself. In this context, disclosure of a single species satisfied the written description requirement where a claim pertains to a well-known genus that is not, itself, the invention, and the specification disclosed (1) examples of the mouse antibodies were well-known, (2) the methods of making those mouse antibodies were well-known, and (3) the process for humanizing those mouse antibodies to species under the claimed genus was routine.

The court next addressed the enablement requirement of 35 U.S.C. § 112: A patent specification “must teach those skilled in the art how to make and use the full scope of the claimed invention without undue experimentation.” Lilly argued that only disclosing one species out of a very large number of mouse antibodies that could fit in the genus, without disclosing how to determine in advance which ones would have the effect to treat a headache, required undue experimentation by others.

The court again rejected Lilly’s argument explaining that (1) the mouse antibodies and methods of making them were already well known, (2) the humanizing process was routine, (3) the species themselves were not claimed, and (4) all species of the genus work in the claimed method. Hence, the Federal Circuit deemed an undertaking to find or make all species to determine the scope of the genus to not be undue experimentation, but rather “extra credit.” The screening process argued by Lilly was not necessary in light of the information disclosed in the specification. The Federal Circuit remanded the case to the district court for further proceedings.

Takeaways

  • Greater disclosure is required when the genus itself is the invention. When analyzing the adequacy of a written description for a patent claim dealing with a genus, practitioners should distinguish whether the invention is the genus itself or the genus is simply used as a part of a different invention.
  • Undue experimentation is not required to determine the bounds of a claimed genus where all precursors and processes for converting the precursors to species are well known in the art, if all species of the genus provide the claimed function of the genus.
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In mCom IP, LLC v. City National Bank of Florida, the Federal Circuit reversed an award of attorneys’ fees under 35 U.S.C. § 285 against the patent owner and sanctions under 28 U.S.C. § 1927 against its counsel, holding that neither the patent owner’s decision to litigate patent claims surviving inter partes review (IPR) nor counsel’s alleged lack of diligence cleared the high bars those statutes impose. The decision captures the distinction between correctness and substantive strength in the context of § 285’s “exceptional case” standard set forth by the U.S. Supreme Court in Octane Fitness, LLC v. ICON Health & Fitness, Inc.

Background

The ʼ508 patent generally relates to a system and method for delivering a retail banking multi-channel solution that unifies interactive electronic banking touch points. In other words, the ʼ508 patent is about software that ties together all the different ways a customer interacts with their bank — branch visits, ATMs, phone, online banking, mobile apps, even kiosks — so they look and behave like one consistent experience instead of separate disconnected systems with different menus and separate logins or workflows.

In 2023, the Patent Trial and Appeal Board (PTAB) of the USPTO held that all but four claims (2, 8, 14, and 17) of mCom’s U.S. Patent No. 8,862,508 unpatentable (IPR2022-00055). After the PTAB’s ruling, mCom brought an action against City National alleging infringement of the four remaining claims. At the same time, City National and mCom were debating City National’s claim that it was licensed to practice the ʼ508 patent under an mCom agreement with NCR Corporation. The district court struck mCom’s first complaint but allowed mCom to amend. The district court then dismissed mCom’s amended complaint with prejudice finding that each of the four asserted claims were invalid for failing to add any substance or non-obvious content to the claims held unpatentable in the IPR. The court also noted that infringement had not been adequately pleaded because mCom’s “claim chart is difficult (if not impossible) to parse,” and mCom otherwise offered only “bare assertions . . . that the screenshots in the claim chart ‘literally specify the claimed functions.’”

Attorneys’ fees and costs were subsequently awarded to City National under the exceptional-case authority of 35 U.S.C. § 285 (against mCom) and the attorney-sanction authority of 28 U.S.C. § 1927 (against mCom’s counsel, Victoria Brieant).

The Federal Circuit’s Analysis

The appellate panel left undisturbed the lower court’s dismissal of the complaint with prejudice, which affirmed the finding that the asserted claims are invalid. The remaining issues on appeal were (1) whether the case was exceptional under § 285 and/or (2) litigated in bad faith under § 1927.

35 U.S.C. § 285 permits a district court, in its discretion, to award fees to the prevailing party in an “exceptional” case. As explained in Octane Fitness and as previously discussed in IP IQ posts on September 17, 2025, May 30, 2023, and May 18, 2023, the case must “stand out from others with respect to the substantive strength of a party’s litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated.” The Federal Circuit addressed each of the district court’s four grounds used to support the § 285 award.

First, the district court reasoned that mCom’s case was unusually, substantively weak because the asserted patent claims were invalid. The Federal Circuit was not persuaded, again relying on Octane Fitness, which clarified that “[I]t is the ‘substantive strength of the party’s litigating position’ that is relevant . . ., not the correctness. . . of that position.” Further, the panel noted that the standard of a district court challenge has a higher burden of persuasion compared to an IPR, so mCom could reasonably have believed that the district court could not simply take the IPR result for the other claims as a starting point (via issue preclusion) and address only patentable distinctness — because district-court obviousness faces a higher burden. Therefore, there was no warrant for a determination that the case was unreasonably weak or unreasonably maintained.

Second, the district court treated the strike of mCom’s first complaint and the dismissal of its amended complaint as evidence of an exceptionally weak or unreasonably litigated case. The appellate panel again disagreed, finding these procedural events neither legally sufficient on their own nor responsive to whether mCom’s allegations themselves were exceptionally weak.

Third, the district court faulted mCom for failing to investigate “whether a license . . . would cover the purported infringing activity,” “even after being put on actual notice” of such a license and treated that lack of diligence as evidence of an unreasonable suit. The appellate panel disagreed, explaining that, absent a finding that a license or related agreement actually existed, mCom’s decision not to consider a license before initiating litigation could not support a § 285 award.

Fourth, the district court inferred from mCom’s history of filing many patent suits without taking any to trial an improper goal of “quickly settling . . . for nuisance value.” The appellate panel rejected this ground as unsupported by the record because there was no showing of the values of the settlements or even which involved the ’508 patent.

With respect to the § 1927 sanction, under Eleventh Circuit law, imposing liability for excess costs requires that the attorney have engaged in “egregious” and “objectively reckless” conduct, that is, behavior “tantamount to bad faith.” To meet this standard, the attorney must have knowingly or recklessly pursued a frivolous claim or needlessly obstructed the litigation of a non-frivolous claim. The district court made no express determination that mCom’s case was frivolous, and the appellate panel found no basis for such a determination on the record. Instead, the district court had faulted Ms. Brieant for insufficient diligence in investigating the case and the material produced during discovery. The Federal Circuit, however, held that the lack of diligence does not rise to the level of needless obstruction of a non-frivolous suit.

Key Takeaways

  • An IPR ruling is not always the end of the story. Losing claims at the USPTO does not foreclose a patent owner from litigating the surviving claims in district court, and asserting them is not, without more, “exceptional” under § 285.
  • An “exceptional” case must actually be exceptional. Under Octane Fitness, what matters is the substantive strength of the litigating position, not its ultimate correctness, and a string of procedural setbacks is not a substitute for that showing. In other words, the movant must articulate why the patentee’s position was unusually weak, not merely wrong.
  • A lack of diligence alone is not sanctionable. § 1927 sanctions under Eleventh Circuit law requires conduct “tantamount to bad faith.” Absent a finding of frivolousness or needless obstruction, an insufficiently diligent investigation does not meet that bar.