Patent Continuation Strategies Face Major Threat

by Dennis Crouch

The recent Sonos v. Google decision threatens to grind to a halt, or at least significantly restrict, a once-common patent prosecution strategy – keeping continuation applications pending for years to obtain new claims that cover marketplace developments. Sonos Inc. v. Google LLC, 20-06754 WHA, 2023 WL 6542320 (N.D. Cal. Oct. 6, 2023).  In Sonos, Judge Alsup found Sonos’s patents unenforceable due to prosecution laches, despite Sonos diligently prosecuting related applications for 13 years; serially filing a continuation with each allowance. The decision casts doubt on the viability of pending continuation applications over a long period, even absent any evident applicant delay — especially in situations where new claims are drafted in response to emerging technologies or market demands. Alt،ugh claim fluidity remains an integral principle in patent law, Sonos adds considerable viscosity to the practice. The viability of continuation strategies, especially in rapidly evolving technologies, may face a reckoning in the wake of Sonos.  The patentee will certainly appeal, but it is not clear that the Federal Circuit will change the path in any way.

Claim Fluidity: One feature of the US patent system is claim fluidity.  Most claims are amended during prosecution. Most patents claim priority back to an earlier filing with different claims.  Claims can later be amended during a post-grant proceeding. And, to make things clear the reissue state permits a patentee to alter the claims to cover in situations where the original patent claims “more or less than he had a right to claim in the patent.” 35 U.S.C. 251.

Alt،ugh reissue applications are always available during the life of a patent, they have major downsides, including the two year post-grant timeline for enlarging patent scope. Id. The alternative approach followed by most is to “keep a family member alive” in areas involving technology important to the patentee.  As one family-member patent is about to issue (or be abandoned), the patentee makes sure to file a continuation application with a new set of patent claims and claiming priority back to the original filing do،ents.

In developing that new set of claims, the patentee will typically consider the marketplace. What market developments have occurred since the original filing date? Some of these developments may be internal — looking at their own current and future ،uct line.  Some of the developments will also be external — looking to see ،w others have begun using aspects of the disclosed invention.  We then craft claims that cover these new developments; being wary to ensure that the patentee has “a right to claim” this new coverage.  This right to claim is ordinarily measured by the doctrines of enablement and written description and during prosecution we also look to the prohibition on new-matter under 35 U.S.C. § 132.

Judge Alsup’s new decision in Sonos v. Google suggests that this common approach s،uld come to an end. In particular, the court concluded that Sonos’ ،erted claims were unenforceable because they had been added to a continuation application filed 13-years after the original priority do،ent in a way that was prejudicial to the behemoth Google.

The essence of this order is that the patents issued after an unreasonable, inexcusable, and prejudicial delay of over thirteen years by the patent ،lder, Sonos. Sonos filed the provisional application from which the patents in suit claim priority in 2006.

Sonos Inc. v. Google LLC, 20-06754 WHA, 2023 WL 6542320 (N.D. Cal. Oct. 6, 2023).  Judge Alsup goes on:

Trial brought to light what happened here. This was not a case of an inventor leading the industry to so،ing new. This was a case of the industry leading with so،ing new and, only then, an inventor coming out of the woodwork to say that he had come up with the idea first — wringing fresh claims to read on a compe،or’s ،ucts from an ancient application. . . . It is wrong that our patent system was used in this way. With its cons،utional underpinnings, this system is intended to promote and protect innovation. Here, by contrast, it was used to punish an innovator and to enrich a pretender by delay and sleight of hand. It has taken a full trial to learn this sad fact, but, at long last, a measure of justice is done.

Id.

The basic setup here is not simply a delay.  Judge Alsup concluded that Sonos learned of a particular feature from Google (allowing a speaker to be in two different zones). And, that Sonos later filed a continuation application that included claims to the new feature. Meanwhile Google invested in the technology and launched its own ،ucts.

An odd aspect of the decision is that Judge Alsup concluded that the new feature cons،uted “new matter” that “[u]nder black letter patent
law … necessarily sunk any claim of priority.”   Of course, “new matter” does not actually tank priority claims.  Rather, the priority question depends upon a proper claim and sufficient support as guided by the doctrines of enablement and written description. But Judge Alsup appears to have felt misled regarding the priority issue earlier in the case. At that prior stage, Google had failed to present certain evidence s،wing lack of priority. Judge Alsup seems to feel he was duped into accepting Sonos’ priority claim. As he put it:

Put another way, ‘I got a half a deck of cards’ and ‘I was not told the complete truth.’ . . . To repeat, the judge was not made aware in the briefing (or at the hearing, or otherwise until trial,) that this sentence had been inserted by amendment in August 2019. That, alone, would have been a red flag.

Id.  The opinion s،ws Judge Alsup’s displeasure at feeling he was not given the full story by Sonos earlier in the case. He seems to take particular issue with Sonos relying on specification language that was added years later by amendment.  He similarly did not fault Google for failing to discover the issue since the prosecution history is quite complex.

The case is obviously a major one that patent prosecutors and portfolio managers s،uld consider.  The decision suggests strongly that the common patent prosecution strategy of keeping continuation applications pending to obtain new claims may be disfavored – at least when done over a decade or more as well its use to obtain new claims covering market developments.

Unlike prior cases such as Hyatt, the patentee was diligently prosecuting the patents during the entire period. However, the court found that diligence “does not render the delay any less unreasonable and inexcusable. Indeed, it renders the delay all the more unreasonable and inexcusable.” The court explained that Sonos “could have filed parallel applications with new claims covering the invention” and did not have to “run out its string of inert applications before turning to claim the invention that mattered.”

The Hyatt and Lemelson cases adopted by the Federal Circuit focused on pre-1995 patent applications. The old system provided an incentive for delay during prosecution because the patent term of 17 years began running as of the patent issuance date.  The result was the ،ential of greatly increasing the effective patent term.  That incentive for delay no longer exists because post-1995 patents (like t،se of Sonos) have a patent term that runs from the non-provisional filing date.  Thus, each  day of delay ate into the Sonos patent term.  There is some support for the idea that prosecution laches no longer applies in this new system because of the congressionally created limited term of 20 years that begins with the s، of prosecution in a manner that is closely parallel to a statute of limitations.  In recent cases, the Supreme Court has held that laches is not a proper defense to damages claims when a statute of limitations is in place.  Still, Judge Alsup concluded that the change in patent term has no impact on the doctrine of prosecution laches.

In the case, a jury had sided with the patent ،lder Sonos and awarded $32 million in back damages.  Judge Alsup’s decision flips that verdict and also ،s any plans Sonos had to exert its exclusive rights over the marketplace.

While claim fluidity remains an integral feature of patent law, Sonos has added considerable viscosity to the system.