Derivation Proceedings

Along with the switch from a “first to invent” to a “first to file” patent system, the America Invents Act (AIA) created a new proceeding to deal with disputes over the true inventor of the subject matter of a patent application – Derivation Proceedings. While this particular proceeding is new, derivation proceedings have their roots in Interference Proceedings, where rival inventors also sought to prove the true inventor of the invention. In Interference Proceedings, the true inventor is awarded the patent, regardless of which party was first to file an application.

The goal of a Derivation Proceeding, however, is to determine whether the filer of a patent application “derived” material in that application from the true inventor. This type of inquiry is consistent with the requirements of the first to file system, where the first filer must be the actual inventor of the invention. Derivation actions are often instituted when two parties jointly working on an invention had a falling out, with one party filing an application that derives material from the other party’s previously filed application.

Background

Catapult Innovations Pty Ltd., filed three derivation petitions under 35 U.S.C. § 135(a) with the Patent Trial and Appeal Board (PTAB) against adidas AG regarding three of adidas AG’s filed applications: U.S. Pat. App. 13/077, 494; U.S. Pat. App.13/077, 510; and U.S. Pat. App. 13/543,428. On July18, 2014, the Patent Trial and Appeal Board (PTAB) released decisions on two of Catapult’s three petitions.  

DER2014-0002 Application 13/077, 494 - Petition Denied

In derivation proceeding DER2014-00002, Catapult filed a Petition for Derivation against claims in adidas AG’s Application 13/077, 494 for a system meant to monitor athletic activity in a plurality of individuals.

Catapult argued that adidas AG derived claims in its application from a technical disclosure made by Catapult’s CEO during a two-day presentation and demonstration to a wholly owned subsidiary of adidas, AWSE (adidas Wearable Sports Electronics). The information disclosed during the presentation and demonstration is what Catapult claims as its invention, from which claims in the adidas AG application were derived.

To prove derivation has occurred, the party filing the petition must establish (1) prior concept of the claimed subject matter, and (2) communication of that conception to the respondent. See, e.g., Cooper v. Goldfarb, 154 F.3d 1321, 1332 (Fed. Cir. 1998).

In addition, there must exist at least one “qualifying claim” that is substantially similar to the invention claimed by respondent and the invention disclosed by petitioner. See 37 C.F.R. § 42.405(a)(2). This analysis is actually threefold: petitioner must establish substantial similarity between (1) the claims in its patent application and the disclosed information, (2) between the disclosed information and the alleged derived claims in respondent’s application, and (3) between the petitioner’s claims and the respondent’s alleged derived claims.

The PTAB denied Catapult’s petition on the grounds that the petition only contains evidence of “prior possession” of the information in question, not evidence of prior conception, as required by the two-part test laid out by the court in Cooper. Catapult failed to assert in its petition that it “conceived” of any of the features or functionalities disclosed to adidas AG, instead referring to its “prior possession” of the information in question throughout its petition. The PTAB stated that “possession” is indicative of title of ownership, not originality, which is what is required by “prior conception”.

The PTAB also denied Catapult’s petition because Catapult failed to specifically define an invention from a subset of the technical information it disclosed to adidas AG. The PTAB held that not one of the challenged claims in adidas AG’s application constitutes a derived invention, because Petitioner Catapult could not maintain a consistent link between the information it communicated to adidas AG and that information’s substantial similarity to Catapult’s own claims in its application.  

DER2014-006 Application 13/077, 510 - Petition Denied

In DER2014-00006, the same Catapult application, U.S. Pat. App. 14/045,954, serves as the basis for filing the derivation petition against another adidas AG application, U.S. Pat. App. 13/077,510.

The disclosure, for purposes of proving derivation in this petition, is the same disclosure referred to in Case DER2014-00002— a two-day presentation and demonstration given by Catapult’s CEO to adidas AG subsidiary AWSE, during which technical information regarding the subject matter of Catapult’s application was disclosed.

The PTAB’s basis for denial of Catapult’s petition for derivation was much the same as it had been for DER2014-00002. Catapult again failed to establish that it had prior conception of the invention, instead referring to “prior possession” of the information in question throughout its petition. Moreover, Catapult failed to establish a specifically defined invention in the technical information disclosed to adidas AG during the two-day presentation and demonstration, and also failed to consistently establish the information it disclosed to adidas AG was substantially similar to claims in its own application.

DER2014-0005 Application 13/543,428 - Pending

In DER2014-0005, a decision is anticipated to be released on July 29, 2014. Check back for a follow up post discussing this decision.

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