Patent Owner Tells SCOTUS Avery Dennison Petition is Not the Eligibility Case the U.S. Patent System Needs

In late February, Avery Dennison corporation petitioned the U.S. Supreme Court to grant certiorari in its appeal of a decision upholding ADASA, Inc.’s patent for Radio Frequency Identification Device (RFID) technology as patent eligible. ADASA has now responded, telling the High Court that the U.S. Court of Appeals for the Federal Circuit’s (CAFC’s) decision in the case “is a beacon of clarity and oasis of correct legal analysis, not a plea for this Court’s intervention.”

Avery Dennison said the CAFC’s decision “illustrates the depths of the Federal Circuit’s division” and represents “the other side of the coin” in the eligibility debate. While SCOTUS petitions on eligibility have traditionally focused on uncertainty due to the CAFC’s too-narrow view of the law and tendency to invalidate patents under Section 101, Avery Dennison’s petition takes the position that the Federal Circuit’s reading of 101 is too broad.

Pending Petitions Are Irrelevant

But ADASA said in its brief in opposition filed yesterday that claim 1 of its U.S. Patent No. 9,798,967 “’does not merely claim a principle, but a machine embodying a principle,’ like all eligible machine/manufacture inventions do.” ADASA also characterized Avery Dennison as “a party severely sanctioned for litigation and discovery misconduct in proceedings below” and distinguished the case from Tropp v. Travel Sentry, Inc. and Interactive Wearables v. Polar Electric Oy; Avery Dennison has asked the Court to, at a minimum, hold its petition pending review of those cases, should either petition be granted. But ADASA said the there is no way those cases could affect the outcome here because the Solicitor General’s examples of eligible versus ineligible inventions in its amicus brief for both cases make it clear that ADASA’s patent would fall on the eligible side of the line. ADASA added:

“The United States’ proposed framework amplifies how no party in either other case urges this Court to adopt a legal standard that could possibly benefit Petitioner here. The patentees in both cases urge the Court to broaden eligibility, while the accused infringers urge the Court to leave the Federal Circuit’s legal standard intact. No party suggests eligibility should be radically narrowed in a way that would affect the result here.”

Avery Dennison said in its petition that the CAFC’s decision “markedly departs” from the Supreme Court’s teaching that “abstract ideas are not patentable.” The claim at issue “sought a patent monopoly over the simple concept of treating one long serial number as the combination of two shorter numbers, and then directing that blocks of RFID tags all start with the same shorter number,” it added.

But ADASA’s brief countered that “[s]ince claim 1 covers an ‘RFID transponder’ with a number of physical parts, it qualifies as either or both of a ‘machine’ and a ‘manufacture’ under statutory language.”

The Federal Circuit’s decision held that claim 1 of the patent is “directed to a specific, hardware-based RFID serial number data structure designed to enable technological improvements to the commissioning process” and rejected Avery Dennison’s arguments that the claim merely mentally ascribes meaning to a pre-existing data field. The court cited prior cases, such as Enfish, LLC v. Microsoft Corp and Uniloc USA, Inc. v. LG Elecs. USA, Inc., maintaining that those cases held similar claims eligible. The CAFC did, however, reverse the district court’s finding that the claim was valid under sections 102 and 103 and remanded for further proceedings.

The ADASA brief said that Parker v. Flook and Diamond v. Diehr guide the analysis in this case, and that the invention at issue falls clearly on the Diehr side of the line. “The patent is on an ‘RFID transponder’—clearly a technological structure, not a mathematical formula, and certainly not a non-structural “particular technological environment,” said the ADASA brief.  As for Bilski v. Kappos and Alice v. CLS Bank, they could not be more different than the present case, as both of those cases “involved broad patents on fundamental economic concepts.”

Not the Case We Need

ADASA also argued that the case is a poor vehicle for a number of reasons. First, Avery Dennison’s argument is convoluted, as it has proposed that whether the claims at issue were abstract turns on a fact-bound question of claim construction, said ADASA. “Taking Petitioner at its word, Petitioner evidently believes that eligibility turns on a predicate question of claim construction that the Court will have to resolve in order to even reach the eligibility questions in this case—a classic vehicle problem that will impede resolution of the question presented,” said the brief.

Additionally, ongoing district court litigation could make the eligibility question moot; and, most importantly, reviewing a case where the patent claims were actually upheld as eligible is not in the patent system’s best interests. The brief explained:

“The patent system’s greatest need now is for review of decisions finding claims ineligible, not eligible. The destabilizing impact of uncertainty in this area cited at length in the Petition (Pet. 28-31) falls squarely on patent owners, not accused infringers. It is patent owners who need review of errant Federal Circuit decisions that (unlike the present one) overexpand the judicial exceptions to eligibility, and use it to swallow all of patent law. Accused infringers already benefit from this uncertainty, by obtaining questionable dismissals in case after case. This case falls on the wrong side of that divide for review to be appropriate.”

While Avery Dennison’s bid to get the Court to review the case in the interest of having a balance between eligibility decisions favoring patentees and those adverse to them, ADASA said “this viewpoint is facile and wrong.”

The National Retail Federation and the Alliance for Automotive Innovation have filed a joint amicus brief in support of Avery Dennison, as has Impinj, Inc.

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