Is Any Patent Safe?
Global Industrialist Sir Alfred J. DiMora Joins in the Struggle of
American Inventors and Evolutionary Intelligence
Palm Springs, California - April 18, 2017 - An interview with Sir Alfred J. DiMora, founder of DiMora Enterprises, LLC, DiMora Motorcar, and DiMora Mobile, who was recently appointed Managing Director of Evolutionary Intelligence. DiMora Enterprises is currently active in the auto industry, construction industry, telecommunications, solar energy, and city infrastructure on four continents.
Why did you join Evolutionary Intelligence, Sir Alfred?
Big tech companies are playing a game of ‘winner take all’ against American inventors using the judicial system to invalidate patents. The courts are beginning to invalidate patents by ruling the patents are invalid on the pleadings, often without claim construction, or claim analysis, even by comparing complex technical patents to such things as the behaviors of coffee servers and librarians, which is what happened in the case of Evolutionary Intelligence. No trial, no weighing of fact, no accountable method of review. Just a judge ruling, after one has spent more than four years and four million dollars even before reaching trial, that one's work of a decade has been wiped away.
This practice is destroying America's innovation economy and faith in our patent system. Now with Intellectual Ventures announcing they will no longer be buying patents, Congress and special interests have virtually succeeded in completely defeating the independent American inventor. Evolutionary Intelligence may be the last case by an American inventor to ever get so far as defeating eight Inter Partes Review (IPR) challenges before the Patent Trail and Appeal Board (PTAB), only to be defeated by a judgment on the pleadings, lacking analysis. So now we must pursue re-hearing before the Federal Circuit, and next a petition to ask the U.S. Supreme Court to take the case. Perhaps Congress does not realize the negative impact that the antipatent sentiment reflected in the new patent laws and court decisions has inflicted upon the inventors in this country.
Can't Inventors License Their Patents to Those Companies?
These days even if you send a patent licensing inquiry to one of these big tech companies, they don’t investigate your technology at all. Rather, they are just as likely to sue you for declarative relief. These companies know you probably can't sue them for infringement because it will take over a million dollars just to get through the Inter Partes Review process and 101 challenges to confirm your patent is valid. And that’s before you even start talking about infringement. The inventor doesn't really stand a chance, no matter how good the patents are, no matter how strong the infringement case is. Most investors will not back patents anymore, and in this environment, can you blame them? The current situation is directly contrary to purpose for which the power to grant patents was put into our Constitution. The patent system has been gutted by laws favoring special interests. Small innovative companies are being devastated. Not only do you have to be a large corporation to afford an infringement suit, once you do, you must run a gauntlet of laws that affect your ability to ever get to trial. And, if you lose, you can be sued for legal costs. Patents have become a broken bargain with the American inventor. A precedent is being set. Congress needs to act.
Sir Alfred J. DiMora
What originally interested you about the case?
Being an inventor and entrepreneur myself for over forty years, I realize the importance and necessity of strong patent and intellectual property laws. Here there was a historic showing before the Patent Trial and Appeal Board, without a single claim being cancelled. I do not know of an inventor or small company that has ever gotten this far. Many corporations and patent holders are protesting how tough the Patent Trial and Appeal Board is being on patents, invalidating so many patents and claims. Our company, Evolutionary Intelligence, withstood a barrage of eight Inter Partes Reviews advancing fifteen prior art patents against our technology, and the defendants were resoundingly defeated in their attempts to invalidate the patents at that stage.
Do you think Evolutionary Intelligence's patents are good software patents?
Let me clear this up. That's where the confusion starts. They are not really software patents; they are network computing device patents. That's how they have to be looked at. (Here Mr. DiMora held up one of his own smartphones.) Ever seen one of these? It's a network computing device. I would call this an innovation. So, the issues here are enormous, in terms of protecting innovation through the patent process.
Okay, so then are the Evolutionary Intelligence patents good patents in general?
I know they were procured by one of the country's three leading intellectual property firms, Fish and Richardson. I took the time to read them closely. The specification details out the invention in precise detail for 45 pages with over 700 numbered element references and 31 diagrams. The claims also are highly technical, and require serious reading. The quality is obvious when you read the serious analysis done by the expert judges of the Patent Trial and Appeal Board. Do District court judges have this expertise?
But the Court in the Northern District of California ruled the patents invalid?
In my opinion, this may be the first case in history to have such a strong win before the Patent Trial and Appeal Board, only to be then found invalid in a judgment on the pleadings before the District Court in the Ninth Circuit. The District Court concluded the patents were invalid even before the parties filed their joint claim construction documents with the court. All of this happened after the Defendants had lost all their challenges at the PTAB and 10 claim terms had been construed with neither party disputing those PTAB constructions. Prior to the PTAB action, the defendants agreed that the results of the PTAB would “inform the district court.” Instead, that non-disputed claim construction and the entire technical analysis somehow disappeared from consideration by the district judge. The ruling ignored all the work the expertly trained judges at the PTAB had accomplished, and substituted unfounded analogies presented by the Defendants, comparing the patents to coffee servers, librarians, businesses, and human enterprises. Really? Is this what the claim terms and invention are really about?
Then how is such a ruling possible?
It really isn't, or certainly should not be, in a motion for a ruling on the pleadings. Basically, the Court said the “patents 'resembled' age-old forms of information processing such as have been previously employed in libraries, business, and other human enterprises, with folders, books, time-cards, and so on.” But the law is well settled that if a judge compares things which are not part of the pleadings to the patent claims, he cannot resolve any disputed issues in favor of the movant, here the defendants. Yet, that is exactly what he did in analogizing the patent claims to “age-old forms of information processing.” Evolutionary Intelligence certainly did not agree with that and so the motion to dismiss the case on the pleadings and invalidate the patent should have ended there. Because facts related to how the claims could be compared to, e.g., age-old forms of information processing, have to first be established, which includes mapping to every step of the claims, it was improper for the judge to do this on his own at this early stage. It was improper for the judge to consider, factually, how “libraries, books, ledgers, and other human enterprises,” actually have operated since around 3000 BC, and then compare his understanding of that to his own understanding of what the patents cover. Sadly, the US Court of Appeals failed to see the error, and affirmed the District Court's ruling with just a few sentences. Instead of an analysis of what the claims are actually directed to, as required by the Supreme Court, the Court of Appeals issued a non-precedential one page opinion affirming the District Court, meaning no one is going to pay attention to the problems in the original ruling.
Can patents really be taken away like that?
They can. If we do not speak up, no one but large corporations will ever be able to enforce their patent rights. Big companies do not want inventors with patents to get in their way. An example is the story of Robert Kearns with his invention of the intermittent windshield wiper. The Supreme Court has interpreted due process to mean that the taking of life, liberty, or property requires constitutionally adequate protections, but cases such as these must first be brought to the Supreme Court in order to stop the practice. The country’s innovation environment is on a slippery slope here, and if we don't draw the line, patent protection may be gone forever for independent inventors. This is a much bigger story than just one case. Given this, should independent inventors apply for patents at all? Many patent attorneys are advising their clients that it’s not even worth the expense because any patent that is achieved can be defeated. This is something the Supreme Court and the Congress must address.
So, what next?
Our attorneys are sending out a letter requesting Amici support. Everyone should read it because the way in which this ruling occurred could invalidate any software or biotech patent, probably even any patent. Anyone who cares about our legal system or our patent system, and wants to see what is really going on in our nation, and what has happened to the American inventor, should read this letter. Because technology entrepreneurs are leaving this country, and foreign investment is staying out. This needs to change, and change now. Several intellectual property organizations and even David Kappos, the former director of the United States Patent and Trademark Office, have called for the abolishing of 101. Innovation cannot be controlled through the legal system for the benefit of the few, but that is what is happening.
Anyone interested in seeing this change should see our legal counsel's letter requesting Amici support and share it with any and all concerned.